A few days ago, Dan Yurman at Neutron Bytes published a blog post that is now titled Flash: NuScale executive says firm may build SMRs at Idaho lab. It was a follow-up to an earlier post in which Dan speculated about the Idaho National Lab’s potential as a good site for a new nuclear power plant.
One statement that Dan made in that original post, titled New life for Idaho test reactor, are SMR’s next?, stimulated Mike McGough, NuScale’s Chief Commercial Officer, to provide a gently worded correction.
Hey Dan. I read your post and you may not have seen that NuScale has long-ago announced that UAMPS will be the owner and ENW the operator of our first plant in Idaho and that we are in site selection activities as we speak. While we do not yet know exactly where the best site will reside, we do know that the DOE INL site has been well-characterized and that we expect to find possible choices there, once the screening of the state is competed.
That comment stimulated some additional discussion and clarification. Here is the sentence that attracted McGough’s response.
However, despite obvious speculation that emerges from time-to-time in Idaho Falls, none of the vendors has said so much as “boo” about these prospects, and at least so far none of the chatter would cause an investor to open publically (sic) their checkbook.
Over the past year or so, I have seen and heard McGough speak at conferences in Idaho, North Carolina and Northern Virginia. I travel far less frequently than he does; I think he lives out of a suitcase. It was not surprising to me that McGough would respond to someone saying that his company has not said “boo” about its project development efforts; he’s spent a lot of time giving talks all over the world to the kinds of audiences that can and will make things happen. I have no doubt that there are many developments that have not been announced yet, but even those that have been made public amount to more than mere hints.
For example, on July 1, 2013, NuScale issued a press release titled NuScale Power’s Small Modular Reactor Chosen as Preferred Technology by Western Initiative for Nuclear which provided a reasonably detailed description of a well resourced program of regional development. It mentioned a demonstration project and additional interest in follow-on units. It included quotes from three governors of states that are interested in reliable, carbon-free generation and statements by two public utilities interested in deploying and operating NuScale power plants.
As I reread that press release, the date jumped out at me. I contacted Mike McGough and confirmed my suspicions. That press release was purposely issued on the day the submission window closed for the second round of funding under the Department of Energy’s small modular reactor program. NuScale obviously knew the details of its strong support earlier than that and included evidence of that support to reinforce the strength of its submission package.
NuScale, even though it is a startup, is apparently led by people who were wise enough to protect that critical information until after its competitors for the funding opportunity could not respond or attempt to steal its potential business partners.
When I spoke to McGough, he was in Paris at the World Nuclear Exhibition. After telling me that I had no reason to be jealous because he rarely gets a chance to do any sightseeing when he attends such events, McGough told me how busy his company’s phones have been with contacts from interested potential customers and suppliers. He attributed the recent increased rate of calls to recognition of the substantial advantages of his company’s product, the DOE selection of NuScale as the sole recipient in the second round of SMR funding, and the virtual disappearance of B&W mPower, Inc. as a strong competitor.
McGough shared the presentation that he was scheduled to give in Paris and gave me permission to use some of the material since it was being provided in a public forum. One of the new items to me was a bullet that said that NuScale now has a “line of sight” to its first 12 power plants, each of which would include 12 NuScale power modules for a total of 144 modules. Several months ago, I heard a NuScale presentation claiming that the company reaches ‘N’, as in the “Nth of a kind” economics after it has produced between 19-20 modules.
The demonstration project will be known as UAMPS Carbon-Free Power Project (CFPP). It will be owned by UAMPS (Utah Associated Municipal Power Systems), a consortium of 45 member utilities located in six states including UT, AZ, NM, ID, CA, and WY and operated by Energy Northwest, an experienced nuclear plant operator.
The plant will include 12 modules each rated at 50 MWe (gross) for a total plant output of 600 MWe (gross). After accounting for house loads of approximately 30 MWe, the plant will supply 570 MWe to the grid when all modules are operating. (Note: NuScale used to state that its modules would produce 45 MWe each, but has recently refined its estimates. The new number does not represent any design changes, but does show that its engineers tend towards conservatism and “underpromising.”)
There is obviously a major hurdle that must be overcome between now and firm contracts for actual construction. NuScale has not yet submitted its design certification application and there is no guarantees for how long it will take the NRC to review and approve that document. There are not even any guarantees that the NRC will accept the application as complete when it is first submitted or that it will eventually grant the license.
However, I believe the risk of non-approval has been carefully addressed and that the review period after submission should be reasonably close to the predicted 38-42 months. Jose Reyes, NuScale’s Chief Technology Officer, was an NRC regulator early in his career and several other leading engineers at the company are experienced regulators. I have little doubt that the company will submit a high quality application and will be able to provide excellent answers in response to Requests for Additional Information (RAIs).
Once the company achieves its design certification, there will be a line of customers that may not be as impressively long as those outside an Apple store when a new iPhone is released. However, each entity in that line would represent a possible $2-$3 billion sale. There is no reason for complacency or early celebrations, but cautious optimism is not unwarranted.