Rolls-Royce secures funding for SMR deployment

Rolls-Royce Group, BNF Resources UK Limited and Exelon Generation Limited will invest GBP195 million over about three years in the new business. This funding will enable the business to secure grant funding of GBP210 million of UK Research and Innovation funding, first announced in Prime Minister Boris Johnson's Ten Point Plan for a Green Industrial Revolution, released in November 2020. Rolls-Royce Group will own approximately 80% of Rolls-Royce SMR on the completion of this equity raise.

Rolls-Royce said the SMR business, which will continue to seek further investment, will now "proceed rapidly with a range of parallel delivery activities, including entry to the UK Generic Design Assessment (GDA) process and identifying sites for the factories which will manufacture the modules that enable on-site assembly of the power plants."

In May, the UK's Department for Business, Energy and Industrial Strategy opened the GDA process to advanced nuclear technologies, including SMRs. GDA is a process carried out by the Office for Nuclear Regulation and the Environment Agency to assess the safety, security, and environmental protection aspects of a nuclear power plant design that is intended to be deployed in Great Britain.

"Discussions will also continue with the UK government on identifying the delivery models that will enable long-term investment in this vital, net-zero enabling technology," Rolls-Royce added. "Rolls-Royce SMR is engaging with export customers across many continents who need this technology to meet their own net zero commitments."

'Once in a lifetime' opportunity

"The SMR programme is one of the ways that Rolls-Royce is meeting the need to ensure the UK continues to develop innovative ways to tackle the global threat of climate change," said Rolls-Royce CEO Warren East. "With the Rolls-Royce SMR technology, we have developed a clean energy solution which can deliver cost-competitive and scalable net-zero power for multiple applications from grid and industrial electricity production to hydrogen and synthetic fuel manufacturing. The business could create up to 40,000 jobs, through UK deployment and export enabled growth."

Announcing the government funding, Business and Energy Secretary Kwasi Kwarteng said: "This is a once in a lifetime opportunity for the UK to deploy more low-carbon energy than ever before and ensure greater energy independence." He added, "In working with Rolls-Royce, we are proud to back the largest engineering collaboration the UK has ever seen - uniting some of the most respected and innovating organisations on the planet. Not only can we maximise British content, create new intellectual property and reinvigorate supply chains, but also position our country as a global leader in innovative nuclear technologies we can potentially export elsewhere."

Rolls-Royce SMR CEO Tom Samson said the new business has been established to deliver a low-cost, deployable, scalable and investable programme of new nuclear power plants. "The capitalisation of Rolls-Royce SMR takes us a step closer to achieving a unique, and most importantly investable, proposition in nuclear energy. It is a major vote of confidence in British nuclear technology and the potential for building a world-leading domestic supply chain," he said.

Demo unit in early 2030s

A Rolls-Royce led UK SMR consortium aims to build 16 SMRs - based on small pressurised water reactors - each with a generation capacity of 470 MWe. The consortium - which includes Assystem, Atkins, BAM Nuttall, Jacobs, Laing O'Rourke, National Nuclear Laboratory, the Nuclear Advanced Manufacturing Research Centre (Nuclear AMRC) and TWI - aims to complete its first unit in the early 2030s and build up to 10 by 2035. To minimise the construction phase of the programme, the UK SMR is fully modularised to enable the plant to be transported by road, rail or sea. Targeting a 500-day modular build, they say this concept minimises the onsite time and effort required to construct and build the plant. About 80% of the plant's components will be sourced from the UK. The target cost for each station is GBP1.8 billion (USD2.4 billion) by the time five have been built, with further savings possible. The power stations will be built by the consortium, before being handed over to be operated by power generation companies.

Rolls-Royce said much of the venture's investment is expected to be focused in the north of the UK, where there is significant existing nuclear expertise.

Nuclear AMRC said it will work with Rolls-Royce on the next phase of its SMR development programme and help prepare critical components for commercial production in the UK. The University of Sheffield's Nuclear AMRC will work with Rolls-Royce SMR to develop the manufacturing capability for a variety of advanced processes, using the state-of-the-art machining, joining and testing facilities of the Nuclear AMRC's research factory in Rotherham. The centre will also support the design of a new UK factory for large SMR components. Following this process development, the Nuclear AMRC will continue to work with Rolls-Royce to create a fully integrated pre-production proving facility for SMR manufacturing. The proving facility will be used to manufacture large-scale prototypes of the reactor pressure vessel and its closure head.

The announcement that funding has been secured to enable the SMR project to move to the next phase was welcomed by Nuclear Industry Association Chief Executive Tom Greatrex. "Match funding for Rolls-Royce SMR sends a huge signal to private investors that the government wants SMRs alongside new large-scale stations to hit net-zero. It also shows investors that the government believes in nuclear as a green technology.

"Britain is leading the way in developing this technology, and as we move towards a low-carbon world, there is real opportunity to export to international markets."