Small modular reactors (SMRs) explained: technology, economics, and deployment timeline

The global small modular reactor pipeline surpassed 100 design concepts across 20+ countries by late 2025, with the International Atomic Energy Agency (IAEA) tracking more than 80 SMR designs in various stages of development. Total announced investment in SMR technology exceeded $30 billion between 2020 and 2025, yet only four SMR units were operating commercially worldwide as of early 2026, all at Russia's Akademik Lomonosov floating plant and China's Linglong One demonstration reactor (World Nuclear Association, 2025). This gap between ambition and deployment defines the central tension of the SMR sector: the technology promises cheaper, faster, and safer nuclear energy, but first-of-a-kind builds continue to face cost overruns, regulatory delays, and financing uncertainty that have historically plagued large nuclear projects.

Why It Matters

Global electricity demand is projected to increase 75% by 2050 according to the International Energy Agency's World Energy Outlook 2024, driven by electrification of transport, heating, and the explosive growth of data centers. Renewables alone cannot fill this gap without firm, dispatchable baseload power that operates regardless of weather conditions. Nuclear energy currently provides roughly 10% of global electricity and remains the largest source of low-carbon baseload generation in advanced economies (IEA, 2024).

Conventional large reactors (1,000+ MWe) take 10 to 15 years to build and frequently exceed budgets by billions of dollars. The Vogtle Units 3 and 4 expansion in Georgia, completed in 2024, came in at $35 billion, more than double its original estimate. SMRs, defined as reactors producing up to 300 MWe, aim to solve these problems through factory fabrication, modular construction, and passive safety systems that eliminate the need for large containment structures and emergency cooling pumps.

The decarbonization case is straightforward. A single 300 MWe SMR operating at 90% capacity factor generates roughly 2.4 TWh of carbon-free electricity annually, enough to power approximately 200,000 homes while avoiding over 1 million tonnes of CO2 compared to natural gas generation (Nuclear Energy Institute, 2025). For hard-to-abate industrial sectors, data centers requiring 24/7 power, and remote communities dependent on diesel generation, SMRs offer a compact, reliable zero-carbon energy source that neither solar nor wind can replicate alone.

Key Concepts

What Defines an SMR

The IAEA defines small modular reactors as nuclear fission reactors with electrical output up to 300 MWe, designed for factory manufacturing and modular assembly at the deployment site. The "modular" component is critical: rather than constructing massive concrete containment buildings on-site over a decade, SMR components are fabricated in controlled factory environments, transported by truck or rail, and assembled on a prepared foundation. This approach aims to shift nuclear construction from bespoke megaprojects to repeatable manufacturing.

Reactor Technologies

SMR designs span multiple coolant technologies, each with distinct trade-offs:

Light-water reactors (LWRs) use the same proven water-cooled technology as existing nuclear plants, scaled down. NuScale Power's VOYGR design and GE Hitachi's BWRX-300 fall in this category. LWR-based SMRs benefit from decades of regulatory experience and operational data but offer fewer efficiency gains compared to advanced coolant types.

High-temperature gas-cooled reactors (HTGRs) use helium as coolant and graphite as moderator, operating at temperatures above 750 degrees Celsius. China's HTR-PM, which achieved grid connection in 2023, demonstrates this technology at scale. HTGRs can supply industrial process heat alongside electricity, opening applications in hydrogen production, desalination, and chemical manufacturing.

Molten salt reactors (MSRs) dissolve nuclear fuel directly in liquid salt, enabling continuous fuel processing and inherently safe operation since the fuel drains into a passively cooled tank if temperatures exceed design limits. Terrestrial Energy's Integral Molten Salt Reactor (IMSR) targets deployment in the early 2030s.

Sodium-cooled fast reactors use liquid sodium as coolant and can operate on spent nuclear fuel from conventional reactors, potentially reducing waste volumes by 90%. TerraPower's Natrium reactor, backed by Bill Gates, broke ground in Kemmerer, Wyoming in June 2024 with a planned 345 MWe output.

Passive Safety Systems

Unlike conventional reactors that rely on active pumps, backup generators, and operator intervention to prevent meltdowns, SMRs incorporate passive safety features that function through natural physical processes. Gravity-driven cooling, natural convection circulation, and negative temperature coefficients (where rising temperatures automatically slow the nuclear reaction) mean that in the event of a complete power loss, these reactors shut down and cool themselves without human action. NuScale's design, for example, demonstrated in testing that the reactor can safely shut down and cool indefinitely with no operator intervention, no AC or DC power, and no additional water (NuScale Power, 2024).

How It Works

The SMR deployment model differs fundamentally from traditional nuclear construction. A typical project follows this sequence:

Factory fabrication of reactor modules, steam generators, and containment vessels occurs at centralized manufacturing facilities. NuScale's modules weigh approximately 700 tonnes each and measure 23 meters tall by 4.6 meters in diameter, sized for transport by heavy-haul truck or barge.

Site preparation involves pouring a reinforced concrete foundation and constructing balance-of-plant facilities (turbine halls, cooling systems, grid connections). Because the nuclear island is smaller than conventional plants, site footprints range from 13 to 35 acres compared to 500+ acres for a traditional reactor complex.

Module installation uses heavy-lift cranes to place factory-built components onto the prepared foundation. Multiple modules can be installed sequentially, allowing phased capacity additions. A site might begin with one 77 MWe module and add up to 12 over time as demand grows.

Commissioning and fuel loading follows regulatory inspection. Once operational, SMRs are designed for 18 to 24 month refueling cycles with operational lifetimes of 60+ years.

The economics hinge on the "Nth-of-a-kind" (NOAK) cost reduction curve. First-of-a-kind (FOAK) SMRs will inevitably cost more per MWe than mature designs, just as early solar panels cost far more than today's mass-produced modules. The U.S. Department of Energy estimates NOAK levelized costs for SMRs at $60 to $90 per MWh, competitive with natural gas combined cycle plants when carbon costs are factored in (DOE, 2024). However, reaching NOAK costs requires building dozens of units to achieve manufacturing learning rates, creating a classic chicken-and-egg financing problem.

What's Working

Regulatory milestones are accelerating. NuScale Power received the first-ever SMR Standard Design Approval from the U.S. Nuclear Regulatory Commission (NRC) in 2023 for its 50 MWe module, later uprated to 77 MWe. GE Hitachi's BWRX-300 entered the NRC licensing process in 2024, with Canada's CNSC completing its Phase 2 pre-licensing vendor design review the same year. The Canadian Nuclear Safety Commission and the U.K.'s Office for Nuclear Regulation have introduced streamlined SMR licensing pathways that reduce review timelines from 10+ years to approximately 4 to 5 years (World Nuclear Association, 2025).

Government funding is substantial. The U.S. allocated $2.7 billion through the Bipartisan Infrastructure Law and Inflation Reduction Act for advanced reactor demonstrations, including production tax credits of up to $15/MWh for new nuclear. The U.K. committed £385 million to its SMR competition, selecting GE Hitachi's BWRX-300 in 2024. Canada invested C$970 million in Ontario Power Generation's Darlington New Nuclear Project, which will host the first grid-scale SMR in North America.

Data center demand is creating a new customer base. In 2024 and 2025, major technology companies signed agreements or announced intentions to procure SMR-generated electricity. Amazon Web Services invested $500 million in a partnership with Energy Northwest to develop SMRs near its data center campuses. Microsoft signed a 20-year power purchase agreement with Constellation Energy to restart the Three Mile Island Unit 1 reactor, signaling appetite for nuclear power among hyperscalers (Reuters, 2024). Google and Oracle have also disclosed advanced nuclear procurement strategies for their data center operations.

What Isn't Working

Cost overruns remain the sector's Achilles' heel. NuScale's Carbon Free Power Project (CFPP) with the Utah Associated Municipal Power Systems was canceled in November 2023 after cost estimates escalated from $5.3 billion to $9.3 billion, pushing the projected electricity price from $58/MWh to $89/MWh. The cancellation shook investor confidence and demonstrated that SMR cost advantages remain theoretical until factory production reaches scale.

Supply chain readiness is insufficient. Decades of limited nuclear construction have eroded the specialized workforce and manufacturing base. Nuclear-grade steel forgings, reactor-grade graphite, and HALEU (high-assay low-enriched uranium) fuel remain bottlenecked. As of 2025, only Russia's TENEX and the U.S. Centrus Energy (with DOE support) produce HALEU commercially, creating both supply chain and geopolitical risks (Centrus Energy, 2025).

Public perception and siting challenges persist. Despite improved safety profiles, nuclear projects face significant local opposition during siting processes. The "not in my backyard" dynamic has slowed or blocked projects in multiple jurisdictions. Long-term waste storage remains politically unresolved in most countries, with no permanent geological repository operational outside Finland's Onkalo facility.

Licensing timelines still lag deployment ambitions. While regulators have introduced expedited pathways, the average time from application to construction license for a novel reactor design remains 5 to 8 years in most jurisdictions. Developers targeting commercial operation before 2030 face extremely tight schedules.

Key Players

Established Leaders

• NuScale Power — First SMR to receive NRC Standard Design Approval; 77 MWe light-water modules targeting North American and international markets.
• GE Hitachi Nuclear Energy — BWRX-300 (300 MWe boiling water reactor) selected for projects in Canada, the U.K., and Poland.
• China National Nuclear Corporation (CNNC) — Operates the HTR-PM high-temperature reactor and the ACP100 (Linglong One), China's first commercial SMR that achieved first criticality in 2025.
• Rosatom — Russian state nuclear corporation operating the Akademik Lomonosov floating SMR and developing the RITM-200 for icebreakers and land-based applications.

Emerging Startups

• TerraPower — Bill Gates-backed sodium-cooled fast reactor (Natrium, 345 MWe) under construction in Kemmerer, Wyoming with DOE cost-share funding.
• Terrestrial Energy — Developing the Integral Molten Salt Reactor (IMSR) for combined heat and power applications in Canada.
• X-energy — Xe-100 high-temperature gas reactor (80 MWe per module) targeting industrial heat and power; secured $1.2 billion in DOE funding.
• Kairos Power — Fluoride salt-cooled reactor using TRISO fuel; began construction of the Hermes test reactor in Oak Ridge, Tennessee in 2024.

Key Investors and Funders

• U.S. Department of Energy — Over $3 billion allocated for advanced reactor development and demonstration through 2030.
• Breakthrough Energy Ventures — Backed TerraPower, Commonwealth Fusion Systems, and other advanced nuclear ventures.
• Ontario Power Generation — Investing C$970 million in the Darlington BWRX-300 project, expected online by 2029.

Sector-Specific KPI Benchmarks

KPI	Current Range (FOAK)	Target Range (NOAK)	Conventional Large Reactor
Overnight capital cost ($/kWe)	$6,500 to $12,000	$3,500 to $5,500	$6,000 to $12,000
Levelized cost of electricity ($/MWh)	$80 to $130	$60 to $90	$65 to $150
Construction timeline (years)	5 to 8	3 to 4	10 to 15
Capacity factor (%)	85 to 90	90 to 95	88 to 93
Plant lifetime (years)	40 to 60	60+	40 to 60
Module fabrication time (months)	24 to 36	12 to 18	N/A (site-built)
Site footprint (acres)	13 to 35	10 to 25	500+
CO2 emissions (gCO2/kWh lifecycle)	5 to 12	5 to 12	5 to 12

Action Checklist

• Evaluate whether SMR characteristics (dispatchable baseload, compact footprint, process heat capability) align with your organization's energy needs and decarbonization targets
• Identify potential sites by assessing grid connection capacity, cooling water availability, seismic suitability, and community receptiveness
• Engage early with national nuclear regulators to understand licensing timelines, design certification status, and site permit requirements for your target jurisdiction
• Assess HALEU fuel supply chain risks and establish procurement pathways, particularly given current production concentration in Russia and limited U.S. capacity
• Model project economics under multiple scenarios including FOAK versus NOAK cost assumptions, carbon pricing trajectories, and government incentive availability
• Explore power purchase agreements with technology companies, data center operators, or industrial off-takers that value 24/7 carbon-free electricity
• Monitor vendor milestone progress, particularly for GE Hitachi (Darlington), TerraPower (Natrium), and X-energy (Xe-100), as these projects will set benchmark costs and timelines for the industry

FAQ

Q: How do SMRs differ from conventional nuclear reactors? A: SMRs produce up to 300 MWe compared to 1,000+ MWe for conventional reactors. They are designed for factory fabrication and modular on-site assembly rather than bespoke on-site construction. Most incorporate passive safety systems that cool the reactor through natural physical processes without operator intervention or external power. Their smaller footprint (13 to 35 acres versus 500+ acres) enables deployment at sites unsuitable for large plants.

Q: When will the first SMRs be commercially operational in North America? A: Ontario Power Generation's BWRX-300 at the Darlington site in Ontario, Canada is targeting commercial operation by 2029, making it the likely first grid-scale SMR in North America. TerraPower's Natrium reactor in Wyoming targets the early 2030s. In the United States, no SMR construction license has been issued as of early 2026, though GE Hitachi and X-energy applications are progressing through NRC review.

Q: What fuel do SMRs use? A: Light-water SMRs (NuScale, GE Hitachi BWRX-300) use standard low-enriched uranium (LEU) fuel similar to existing reactors. Advanced designs from TerraPower, X-energy, and Kairos Power require high-assay low-enriched uranium (HALEU), enriched to between 5% and 20% U-235. HALEU supply is currently limited, with the U.S. DOE funding Centrus Energy to scale domestic production and reduce dependence on Russian supply.

Q: Are SMRs safe? A: SMRs incorporate passive safety features that represent a significant advancement over earlier reactor generations. In loss-of-coolant or station-blackout scenarios, these designs shut down and cool through natural convection, gravity, and negative reactivity coefficients without human intervention. The NRC's design certification process for NuScale included extensive analysis of beyond-design-basis accidents and confirmed that the reactor can reach a safe stable state without any operator action or external power.

Q: What happens to the spent fuel? A: SMRs produce spent nuclear fuel that requires the same long-term management as conventional reactor waste. Some advanced designs, particularly sodium-cooled fast reactors like TerraPower's Natrium, can utilize spent fuel from existing reactors, potentially reducing total waste volume by up to 90%. Permanent geological disposal remains the international scientific consensus for long-term management, with Finland's Onkalo repository becoming the world's first operational deep geological facility in 2024.

Sources

• International Atomic Energy Agency. (2024). "Advances in Small Modular Reactor Technology Developments." https://aris.iaea.org/Publications/SMR_booklet_2024.pdf
• World Nuclear Association. (2025). "Small Nuclear Power Reactors." https://www.world-nuclear.org/information-library/nuclear-fuel-cycle/nuclear-power-reactors/small-nuclear-power-reactors.aspx
• International Energy Agency. (2024). "World Energy Outlook 2024." https://www.iea.org/reports/world-energy-outlook-2024
• U.S. Department of Energy. (2024). "Pathways to Commercial Liftoff: Advanced Nuclear." https://liftoff.energy.gov/advanced-nuclear/
• Nuclear Energy Institute. (2025). "SMR Factsheet: Benefits and Applications." https://www.nei.org/resources/fact-sheets/small-modular-reactors
• NuScale Power. (2024). "Technology Overview and Safety Features." https://www.nuscalepower.com/en/technology
• Reuters. (2024). "Microsoft signs deal to restart Three Mile Island nuclear plant to power AI." https://www.reuters.com/technology/microsoft-signs-deal-restart-three-mile-island-nuclear-plant-power-ai-2024-09-20/
• Centrus Energy. (2025). "HALEU Production and Demonstration." https://www.centrusenergy.com/what-we-do/haleu/