Platts Small Modular Reactor Meeting – First Day Observations

The Platts Small Modular Reactor meeting attracted about 250 registered attendees. That might seem like a rather small number to people who are used to industry gatherings where the attendee list can be measured in the thousands, but this meeting was taking place at one of the newer and more expensive hotels in Washington and the registration for the day and half long meeting cost $1495. Even the most interested companies were careful about who they picked to send to the meeting and there were not too many casual observers. The crowd was focused on learning as much as possible about the seriousness of the developers, the interest level of the potential customers, and perhaps most importantly, about the obstacles that stood between good ideas on paper and operating systems actually producing marketable electricity and process heat.

Don Hoffman, President and CEO of Excel Services, provided the introduction and kick-off remarks. Don and his company are celebrating their 25th year in business. They are the platinum sponsor of the Small Modular Reactor meeting and will be active in the rejuvenation of the technology through their numerous services – especially those services that help people with solid engineering designs work their way through the detailed processes involved in preparing license applications and effectively answering the hard questions posed by independent regulators.

Richard Black, Director, Office of Advanced Reactor Concepts, Office on Nuclear Energy, US Department of Energy talked about his new organization’s plans to assist with necessary research and development and the potential of engaging in a cost sharing effort with a couple of selected projects to demonstrate the licensing process. That effort would be modeled after the Nuclear Power 2010 program that provided a 50/50 cost share for a portion of the design certification efforts for the Westinghouse AP1000 and the GE ESBWR. The presentation was encouraging, though at least one person in the audience pointed out that the proposed 2011 funding level approximately $60 million for all of the activities of the Office of Advanced Reactor Concepts would not go very far in meeting the cost of applying for an NRC license.

Mike Mayfield, Director, Advanced Reactor Program, US Nuclear Regulatory Commission talked about his organization’s responsibility for independent reviews of license applications, the need for concrete projects and close coordination with the regulator during the early design phases. He emphasized several times the need for specific details and early engagements. His organization is not interested in hearing marketing pitches or debating licensing concepts and policies through press releases and marketing materials.

Unfortunately, new license applicants have a good reason for being reluctant to get too specific too early with the NRC – as soon as discussions move past general questions, the NRC requires the project to be docketed. That starts the billing clock and puts the applicant on the hook for paying the government $259 for every regulator hour – with no ability to control the number of hours expended. Unlike a commercial interaction, willingness and ability to pay for the government service does not necessarily result in any additional resources for a given project – the money that the NRC receives from its licensees and docketed applicants gets deposited into the US Treasury. The agency can only spend the money that has been appropriated through the normal budgeting process.

If the NRC got deluged with new applicants and started billing those applicants today, the commission would not get an increase in its appropriated budget until at least 2012 and perhaps until 2013. Few new government employees or contractors could be added to improve services until the newly budgeted money actually arrived. This system is a gift of the Reagan Administration, which implemented it for the NRC during an era when there was little expectation of a large influx of new reactor applications and when David Stockman was tasked with devising creative user fees to replace the need for new taxes. The system has another weakness – the general lack of accounting standards and practices within the US Government. Investors and businessmen have a natural reluctance to pay for services that they are not sure they are getting.

Don Ingersoll, Senior Program Manager, Oak Ridge National Laboratory provided a fascinating journey through the history of small reactor development that reminded everyone that the ideas being discussed were not new and that there have been periods of enthusiasm for the concepts in the past without much in the way of actual development – outside of the nuclear submarine force.

Three vendors – NuScale, B&W, and Westinghouse Electric Company – each with a variation of integral Pressurized Water Reactors (iPWR), provided some details about their design concepts and the maturity of their technology. There is a general agreement that these three designs – the 45 MWe NuScale, the 125 MWe mPower^TM, and the 300 MWe IRIS – are the ones that are closest to being ready to move through an NRC licensing process.

They each use standard fuel forms with low enriched uranium dioxide pellets inside zirconium alloy cladding tubes. The fuel reloading schemes assume similar fuel utilization to current commercial reactors – approximately 45 GW-days/tonne of heavy metal. The temperatures and pressures are within the normally used range and the steam pressures in the secondary are well within the bounds of commercial nuclear steam turbine systems. There are design refinements that avoid the possibility of large piping breaks, that provide large volumes of water for passive cooling, that provide seismic resilience, and that reduce the required number of pumps and valves. In the case of the mPower^TM and the IRIS, one of the target markets is replacing the boiler heat systems in existing coal fired power plants.

By the time that the third presenter was up, he started his talk with “me three” to follow the “me, too” of the second presenter. During one of the breaks, I took the advice of the Michael Shepherd, Vice President of Business Development at B&W and watched the computer animation of the refueling operation that his company has designed for the mPower^TM. I was standing close to the big screen; about half way through the animation, I turned around and realized that about 50 people were arrayed around the screen watching the carefully designed concept play out.

During the networking luncheon, I picked a table that happened to have a number of utility company employees. They worked for companies that are interested in SMRs because they fit system needs that cannot accommodate the much larger offerings traditionally offered by established nuclear plant vendors. The utilities are also interested because of the smaller initial financial hurdle. Most utilities in the US are relatively small companies compared to a two unit reactor project for 2200-3200 MWe that might cost $12 – 16 billion. They are much more comfortable with a twelve unit NuScale system producing 540 MWe that might cost $2-3 billion.

I had an opportunity during lunch to stump one of the new NRC commissioners with a question about how they would go about licensing small reactors that float on barges or power ships and thus do not have any site to review. That particular commissioner, William Ostendorff, has deep experience with small reactors that go t
o sea; he has served on six submarines and is a retired Navy Captain. We served together at the US Naval Academy in 1999-2001; he got a chuckle out of the audience when he told them that he would never expect an easy question from me and then took my question as a “look-up”. I’ll report back when I get the answer.

The afternoon session focused on commercial opportunities, the importance of the technology in terms of restoring US leadership in nuclear manufacturing, the opportunities for suppliers to become involved, lessons learned by nuclear shipbuilders using modular construction techniques, and the financial challenges and opportunities that smaller reactor designs will face. Several audience members asked about international markets; most of the discussions from the podium had been focused on actions to license the technology for domestic application and on the US markets that were interested in deploying smaller reactors. The vendors are definitely interested in world wide markets, but they indicated that they were following a first things first approach and did not want to diffuse their efforts before they achieved some initial success here.

Though I briefly chatted with Irfan Ali, CEO of Advanced Reactor Concepts and Mark Campagna, COO and Chief Nuclear Officer of Hyperion Power Generation, in the hallway, yesterday’s sessions were almost completely focused on technologies that are refined light water reactors that can be characterized as Gen III or Gen III+ designs. Conservative minded people – like regulators and utilities – tend to be more comfortable with technologies that they know a lot about.

I am looking forward to more sessions this morning that will focus on international opportunities and the interest of the US Department of Defense for smaller systems that can provide power and heat to large bases and perhaps even smaller forward operating bases. Following the end of the Platts meeting there will be a Department of Energy sponsored workshop on small reactors that is open to the public – with prior registration.