A modest increase in spending for the U.S. Department of Energy's program to promote small modular nuclear reactors found in President Barack Obama's proposed budget for fiscal year 2014 has proponents of the technology disappointed in the administration's commitment, while critics of small modular reactors argue that the budget is too generous.
The budget requested $70 million for the DOE Office of Nuclear Energy, which funds efforts to certify new designs and obtain licenses for what could be the first small modular reactors, or SMRs, to commercially operate as power plants. The centerpiece of the project is a $452 million funding opportunity for two SMR developers with the goal of deploying their designs in a decade. Generation mPower, a joint effort between Babcock & Wilcox Co. and Bechtel Corp., was selected by the DOE in November 2012 as a winner of this funding opportunity. The DOE, however, has said it will issue a second award.
But the budget is not keeping pace with what is needed to fully fund the program, according to a spokesman for the Nuclear Energy Institute, the main trade group for the nuclear industry. The DOE requested $67 million in fiscal year 2012 and $65 million in fiscal year 2013, NEI spokesman Steve Kerekes said in an email. "Level annual funding for a $452 million, five-year program is $90 million," he said. "DOE just announced that it stretched out the program for one more year, to six years. Even then, the program with level funding should be $75 million a year."
In an April 10 statement, the NEI described the spending in the proposed budget as "less than what was anticipated by industry" for small, scalable reactors.
"Given the benefits to job creation, export value, domestic clean electricity supply, and industry's willingness to contribute more than 50 percent of the cost, we encourage Congress to increase the funding to ensure that this program is effectively and expeditiously implemented," Alex Flint, NEI senior vice president for governmental affairs, said in the statement.
In addition, several utilities have rallied behind SMRs as a potential way to achieve fuel diversity in increasingly natural gas-reliant generation portfolios but without the massive capital costs of conventional nuclear plants. The Tennessee Valley Authority signed a contract with Babcock & Wilcox to apply for a construction permit to build 180-MW Generation mPower reactors at a site at TVA's Clinch River plant, while Ameren Corp. subsidiary Ameren Missouri is working with Westinghouse Electric Co. LLC on their own collaborative SMR site.
But there is evidence that SMRs will be just as politically and economically challenging to build as traditional reactors. In addition to criticism by environmental groups skeptical of any subsidies for nuclear energy, taxpayer watchdog group Taxpayers for Common Sense decried the DOE's support for SMRs. In past reports the group has singled out the DOE program as particularly risky for taxpayers due to lack of evidence that it will yield power sources cheaper than natural gas or large reactors.
Autumn Hanna, Taxpayers for Common Sense senior program director, said in an email April 11 that the $70 million budget proposal is for the most part in line with what has been spent on SMRs in the past. But that takes the budget another step down the wrong path, in the group's opinion.
"We cannot afford to pile more market-distorting subsidies to profitable companies on top of the billions of dollars in subsidies we already give to nuclear power," Taxpayers for Common Sense President Ryan Alexander said in an April 10 statement. "If the industry believes in small modular reactors and a reactor in every backyard, that's wonderful ... but don't expect the taxpayer to pick up the tab."
On top of the $70 million, the president requested $20 million for SMR research, development and demonstration, or RD&D, in the form of spending for the DOE's Reactor Concepts RD&D program. But, according to Hanna, that amount was down from $28 million enacted in fiscal year 2012.
Written by: Matthew Bandyk
Original Publication URL: http://www.snl.com/InteractiveX/ArticleAbstract.aspx?id=17455200
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