Could small modular reactors (SMRs) be the answer to the nuclear question?

Australia has about a third of the world’s uranium resources – and a ban on nuclear energy. Is it time to revisit making nuclear power a part of the mix for energy generation?

Modern nuclear generators are much safer now than in the past. There is the option of small modular reactors (SMRs), which allow faster construction and lower capital costs. 

But there are also significant barriers to overcome, and questions about whether it’s even possible for Australia to build a nuclear industry from nothing.

Why nuclear, and why SMRs?

Nuclear energy has zero emissions and is a reliable source of power, unlike solar and wind, which are intermittent. 

The benefits of SMRs over larger reactors include scalability, lower capital investment, faster installation, and higher safety and security. 

SMRs could be installed in decommissioned coal plants according to Tony Irwin, Technical Director of SMR Nuclear Technology.

“The best place to build SMRs is in retired coal plants, with the infrastructure and transmission already there,” Irwin says. 

“Existing staff could be retrained as most of the plant is just the same – only the reactor itself is different. We should be getting ourselves in a position where we are ready to follow this technology.” 

What about the economic case for SMRs? 

According to the latest CSIRO/AEMO GenCost Report, wind and solar continue to remain the lowest-cost options for renewable energy, and nuclear is unviable at $18,000 per kWh. 

But not everyone agrees with this assessment. According to Irwin, the report focuses on capital costs and leaves out some important factors in its calculations. 

This includes capacity factor, which is around 20% for solar compared to 95% for nuclear, and lifecycle – 30 years for solar and 25 years for wind compared to 60-80 years for nuclear. 

“Then there are the costs of storage as well as the huge amounts of materials required for wind and solar,” Irwin says.

The real estate footprint is considerably higher for solar (500 times SMR) and wind (3,000 times SMR), says Irwin, as is the need for transmission lines. 

“The fact that SMRs could be installed in retired coal plants enables the use of existing transmission, cooling towers and other resources,” he says. 

Irwin says when you take all these other factors into account, the true costs per kWh are $12,492 for wind, $10,378 for solar, and $5,596 for installed SMRs – and that’s not even including interstate transmission lines of up to 10,000 km. 

Why not nuclear and SMRs?

On the flip side, there are challenges. 

Anthony Siepolt, Director of Cadency Consulting, says these include the high costs to build reactors (especially compared to sources already in place), the time they take to ramp up to meet higher demand, and their incompatibility with renewables.

“Nuclear is a baseload power – which we are moving away from – and as such is a mismatch with flexible renewables such as wind and solar, backed up by storage,” he says. 

Siepolt says that we can reduce the need for flexibility on the demand side and storage by overbuilding solar and wind. 

“Overbuilding is becoming ridiculously cheap,” he says. 

“And once batteries become cheaper, we will no longer need to overbuild.” 

Another challenge is that SMRs are new and untested, currently only operating in China and Russia. This also means of course that the costs to build them are estimates only.  

Then there is the time factor. Even with SMRs it will likely take Australia about 15 years to get there, Siepolt says, and we need to consider what do we do in the interim.  

Siepolt points out we lack a nuclear industry in Australia and will need time – possibly years – to train people in design, operations, engineering, construction and so on. 

“For nuclear to be viable, we would need to overcome not just one or two of these roadblocks, but all of them – and that’s going to be challenging.” 

Divided viewpoints

Opinions are certainly divided when it comes to nuclear energy and SMRs in Australia.

While some think we should remove the ban on nuclear and allow the industry to under regulatory frameworks, others are not so sure.

Former Chief Scientific Officer Alan Finkel, for example, says Australia has the capacity for 90% renewables in the form of solar and wind plus storage. 

The remaining 10% would be best served with gas-fired power for peaking generation, which would prevent the need to acquire more land to overbuild solar and wind or to build long transmission lines. 

This approach would make our emissions intensity lower than that of nuclear-powered France, Finkel says in the AFR.  

So clearly, there is no consensus or easy answer around the nuclear question in Australia at this point in time!