The case for SMRs may have taken a step forward following the USA’s recent major drought, which lasted the whole of 2012. Other smaller scale non-traditional markets could also spur SMR commercialisation. We look at the possibilities.
In the USA, desalination has been considered as an option to help avoid this kind of crisis in the future. SMRs, which are smaller and easier to establish than conventional nuclear reactors, could become the most suitable type of facility for these types of alternative industrial or civil projects in a number of countries.
By Elisabeth Jeffries
That is already true of South Korea, where KAERI, the atomic energy research institute, received approval in 2012 for a standard design for its SMART reactor. Argentina is another, due to follow suit with its CAREM plant near Buenos Aires. When built, the Korean SMART reactor will be one of the first of a new generation of SMRs in the world, and seawater desalination one of its main applications. This in turn could usher in a potential era for non-utility markets of several types. But desalination has been identified by the International Atomic Energy Agency (IAEA) as possibly the first non--electric use for nuclear reactors, and SMRs in particular.
According to the IAEA, SMRs offer the largest potential as coupling options to nuclear desalination systems in developing countries. The organisation has concluded that the costs for nuclear desalination are around the same as that of natural gas desalination and could even be better, depending on fuel costs.
Jonathan Hinze, a nuclear specialist at UXC Consulting, comments on their potential: “water desalination is what will most likely get SMRs off the block because of its dual use producing electricity and desalinating,” he says.
The dual use produces economic advantages for the technology, which in any case demands a lower upfront capital investment than larger nuclear facilities. There will be many advantages to their use, if they do develop. These include relatively quick construction periods, lower risk of cost overrun as a result of modular construction, increased flexibility to raise generating capacity by adding modules and a potential lower overall cost per kilowatt of electricity generation capacity.
Alternative SMR markets
However, desalination is not the only potential alternative market. Chris Gadomski, lead nuclear analyst for consultancy Bloomberg New Energy Finance, draws attention to the possible use of SMRs in oil sands facilities. “Talking to customers, there is a lot of interest from oil sands [companies]. They say it makes a lot of sense and is one of several options they are looking at” he says.
Reactor manufacturers have responded to this accordingly. “Vendors are developing this because they perceive the need in those [hydrocarbon] industries for all that process heat, and it’s inexpensive electricity,” he points out. Environmentally, it could help mitigate oil sector activities through emissions reduction, especially if carbon taxes were to become widespread: “It has a lot of promise and of course carbon dioxide implications,” he explains. Mining, he suggests, is another potential market, as are steel mills.
Catering to capacity
Nonetheless, major obstacles need to be overcome before this has a chance to be realised. Nothing is likely to happen before the mid-2020s, according to Jonathan Hinze. “An initial plant may have been built by then,” he suggests. However, he casts doubt on its later application for heavy industry such as steel.
For one thing, the capacities of even SMRs may be too great: “Even a 100MW plant is much more energy than a mine or steel mill requires. However, a small design in isolated places might be a possibility,” he says. Vendors, he indicates, would be likely to sell SMRs in ‘six-packs’ so that their total capacity could amount to several hundred megawatts. “At this point utilities are the most logical fit and right now I don’t see anything other than utilities as a first mover,” he argues.
Passing on power
However, Gadomski indicates capacity might not be a problem as industrial companies could sell the spare energy on. But he draws attention to management concerns that could get in the way. “In the oil sands sector the people concerned won’t operate the reactors; they’ll want the heat, but will probably defer to a local group like a utility to do that,” he states. Allocating responsibility for plant performance, he suggests, would be a major consideration in these circumstances as it is not part of the typical skill sets found within heavy industry and hydrocarbons.
Getting regulation right
Compliance is another consideration. “There are a lot of regulatory issues to be resolved, for example how to separate the nuclear power plant from the rest of the steel [mill] operations. There are a lot of institutional barriers that will need to be sorted out,” says Gadomski. He also argues that competition from gas may eventually diminish, too, because of eventual gas oversupply which could alter its economic attractiveness. Nevertheless, SMRs in non-traditional markets remain a distant, but very plausible prospect as SMR developers look at ways to get the technology commercialised.
“The future opportunity is there, but the devil’s in the detail,” says Hinze.
This article was written in conjuction with Nuclear Energy Insider's SMR report. More information can be found here: http://www.nuclearenergyinsider.com/smrreport/
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