GE Vernova plans small nuclear plants in the developed world

GE Vernova aims to deploy small nuclear reactors across the developed world over the next decade, taking a leading position in an emerging technology that could play a central role in meeting growing electricity demand and reducing carbon dioxide emissions. carbon.

The company’s small modular reactor, or SMR, is designed to reduce the cost of building new nuclear power plants, said Nicole Holmes, commercial director of GE Vernova’s GE Hitachi nuclear unit.

GE Vernova is the spin-off of General Electric’s former energy business. The company’s shares have more than doubled since listing on the New York Stock Exchange last April, as investors see the Cambridge, Mass.-based company as playing a key role in the future of the energy sector through a portfolio of divisions covering nuclear, natural energy. gas, wind and carbon capture.

The U.S. government wants to triple nuclear power by 2050 to strengthen a power grid under increasing pressure from growing demand for electricity. But large nuclear projects, at least in the United States, are notoriously plagued by multibillion-dollar budgets, cost overruns, delayed construction deadlines and, sometimes, cancellations.

“Affordability has been the real challenge with nuclear over the years,” Holmes told CNBC. “We’re starting to figure that out at this point.”

Simpler design

GE Vernova’s SMR, the BWRX-300, has a simpler design with fewer components and less concrete and steel compared to a larger nuclear plant, Holmes said. Building the reactor could cost $2 billion to $4 billion, compared to $10 billion to $15 billion for a large nuclear power plant, Holmes said.

The plant produces 300 megawatts of electricity, enough to power more than 200,000 American homes. The average reactor in the US fleet has a power of around 1,000 megawatts, enough to power more than 700,000 homes. The smaller size provides more flexibility in terms of location, she said.

“You could put four of them on a site and get the same output as you would with one big reactor,” the official said. “You can start one, put some energy in, make money while building others. It gives you a lot of options,” she said.

GE Vernova is targeting annual revenue of more than $2 billion from its small reactor business by the mid-2030s. This compares to the company’s total revenue of $33.2 billion. dollars last year. GE Vernova forecasts demand for up to 57 total small reactors in its target markets in the United States, Canada, United Kingdom and Europe by 2035.

To meet that revenue target, GE Vernova would need to ship between three and four reactors per year, according to an October research note from Bank of America. The company could capture a market share of 33% in its target markets, according to the bank.

“We are building a strong order book in these target markets,” Holmes said. “In these early stages, many of the buyers will be utilities.”

GE Vernova is also in talks with large technology companies, which Holmes declined to name, that are showing growing interest in nuclear power to meet electricity demand for their artificial intelligence data centers.

“We are in talks with a lot of big tech companies,” Holmes said. “I see a lot of interest from them in new nuclear and what it could do to meet some of their energy demands.”

Deployments in North America

GE Vernova signed a collaboration agreement in March 2023 with Ontario Power Generation, the Tennessee Valley Authority and Synthos Green Energy in Poland to invest $500 million to launch the BWRX-300 and launch the reactor on a commercial scale.

The goal is to create a standardized reactor design that can be deployed in GE Vernova’s target markets rather than building different nuclear plants at each site, Holmes said.

“We’re working on a power plant that can be deployed in many, many places, in many, many regulatory regimes, and still be the same fundamental power plant,” Holmes said. “They help us meet those requirements to make it the same,” she said of the collaborative partners.

GE Vernova is also seeing growing interest in increasing the capacity of existing nuclear power plants by adding small modular reactors, Chief Financial Officer Kenneth Parks said during the company’s Oct. 23 earnings conference call.

GE Vernova won the first commercial contract in North America to deploy a small modular reactor for Ontario Power in January 2023. Holmes described the project as the first commercial deployment of an SMR not only in North America, but also in the developed world.

The reactor is expected to come online in 2029 in Darlington on Lake Ontario, about 60 miles east of Toronto. Ontario Power is considering potentially deploy three more BWRX-300s Darlington reactors.

In the United States, the Tennessee Valley Authority (TVA) plans to build a BWRX-300 at its Clinch River site, a few kilometers from Oak Ridge National Laboratory.

TVA received the nation’s first early site permit from the Nuclear Regulatory Commission in 2019 for a small modular reactor at Clinch River. The power company has so far approved $350 million for the project, although its board has yet to make a final decision on whether to build a reactor.

TVA is interested in small reactors because they carry less financial risk than large 1,000 megawatt, or 1 gigawatt, reactors, said Scott Hunnewell, TVA vice president. new nuclear program.

“If you have a gigawatt-scale plant where the construction schedule starts at eight years and then extends, your interest charges really start to pile up and drive up your costs,” said Hunnewell at CNBC. “SMR overall, it’s a smaller bite of the apple, a lot less risk associated with it.”

And TVA is already familiar with the BWRX-300’s boiling water technology, Hunnewell said. The power company operates three large GE boiling water reactors at its facilities. Ferry Bruns site that uses the same fuel that would power the BWRX-300.

“GE Hitachi is a known quantity,” Hunnewell said.

GE Vernova, Ontario Power, TVA and Synthos Green Energy will share lessons learned during reactor deployment to further streamline the construction process, Holmes said.

The collaboration will also potentially benefit businesses that are not part of the team. TVA plans to share information with any utility interested in leveraging the power company’s experience deploying small reactors, Hunnewell said.

Interest from the technology sector

While the BWRX-300’s primary customers are utilities, the technology sector is playing an increasingly influential role in reviving nuclear power after a long period of reactor shutdowns in the United States due to a poor economic situation in the face of cheap and abundant natural gas.

Microsoft signed a 20-year power purchase contract with Constellation Energywhich will provide long-term financial support to revive the Three Mile Island nuclear power plant outside Harrisburg, Pennsylvania. Alphabet’s Amazon and Google invested in small nuclear reactors in October.

Holmes doesn’t see tech companies actually building and operating their own nuclear power plants, but rather supporting the deployment of new reactors by purchasing dedicated power from utilities.

“As utilities consider deploying additional capacity, these large technology companies could become buyers and agree to electricity purchase prices that support the deployment of these first units and technologies,” Holmes said.

The growing power needs of tech companies’ artificial intelligence data centers will be a “huge demand driver” for small nuclear reactors, the executive added.