Large-scale nuclear for heat in China, and an American SMR project fights rising costs.
Nuclear energy for electricity generation has been the standard application for civilian nuclear power since the industry began seven decades ago. Heat produces steam, which spins a turbine—technology which uses readily available processes developed in coal, oil and gas burning power plants for over a century. Space and process heat, however, are major energy demands for cities and in industry, and a demonstration nuclear district heat plant has powered up in Dalian City, China. In the United States, a development program for scalable, truck-transportable small modular reactors may have encountered a restraining force more powerful than physics: inflation.
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The fortunes of the civilian nuclear industry have ebbed and flowed with the political tides for 60 years now. Touted in the 1960s as a power source that would create electricity that was too cheap to meter, the industry was excoriated by the environmental movement in the 1970s and 1980s, and suffered the worst possible press in the wake of the Chernobyl and Fukushima disasters.
In the 2020s, however, nuclear is re-emerging with the need to create large-scale dispatchable power to replace fossil fuels. Environmental concerns expressed by detractors 30 years ago are being addressed with new reactor technologies, and both governments and private enterprise are working on clean, safe nuclear solutions with urgency.
Two important developments are happening right now, one in China and one in the United States.
In China’s Shandong province, the Shandong Nuclear Power Company has started supplying district heat to buildings in Haiyang City, with supply increasing by the end of the year to 100 percent of the city’s heating needs. The system uses two Westinghouse AP 1000 reactors, extracting nonradioactive steam from the reactors’ secondary cooling loop, which is then fed into a multistage heat exchanger, where heated water is pumped through municipal supply piping to consumers.
According to World Nuclear News, the project is expected to replace 23,000 tons of coal annually, reducing carbon dioxide emissions by 60,000 tons per year. The system also generates power, taking advantage of waste heat rejected from the two Haiyang units, which provide about 20 terawatt hours of electricity to the grid annually—about one third of demand in Shandong province. Six reactors are planned for the site in total.
In America, a different kind of nuclear project faces a new challenge, one that is neither technical nor environmental. Utah’s Carbon Free Power Project is a consortium of municipal power systems who intend to purchase carbon free energy generated by a new small modular reactor design built by NuScale, which is currently under development at the Idaho National Laboratory.
Demonstration NuScale reactors are developed with a Department of Energy multiyear cost-sharing grant of 1.4 billion dollars, subject to an annual appropriations process in Congress. And Congressional support is key to the project. As reported by Utility Dive, inflationary price increases on steel, combined with higher interest rates, are increasing the cost of the project, which is expected to use half a dozen 77 megawatt reactors, with the first coming online in 2029.
Previous cost estimates for the project predicted power priced at 58 dollars per megawatt hour, but some estimates now run as high as 100 dollars per megawatt hour as costs escalate. The 58 dollar per megawatt hour price is a key benchmark, and participating utilities have the option to abandon the project or renegotiate terms if costs exceed this amount.
It appears likely that the costs will exceed this limit, even with billions in tax credits for clean energy through federal legislation. Participating utilities will have until 2024 to leave the project, after which utilities are locked in contractually. The 2024 timeline is dependent on the Nuclear Regulatory Commission’s review of the project. If utilities begin to drop out of the project due to cost escalation, NuScale’s development program will likely depend on increased federal funding, something which is uncertain with Republican control of the House of Representatives.
From an engineering perspective, the reactors look very promising. NuScale’s technology promises to deliver carbon free power with none of the traditional complexity, high operating cost and safety issues of conventional large-scale reactor designs, in a truck-transportable, modular system.
Carbon free, dispatchable power may still be attractive at pricing higher than 58 dollars per megawatt hour, but no one knows what the energy market will look like by 2029. Will Congress fund the project to get these small modular reactors up and running? Time, and inflation, will tell.
