6 Questions for Michael McGough, Chief Commercial Officer of NuScale Power, LLC

Cross-sectional view of Reactor BuildingNuScale Power, LLC is developing a new kind of nuclear plant: a safer, smaller, scalable version of pressurized water reactor technology, designed with natural safety features. Fluor Corporation (NYSE: FLR), a global engineering, procurement and construction company with a 60-year history in commercial nuclear power, is the majority investor in NuScale. 

As the sole winner of the second round of the U.S. Department of Energy’s (DOE) competitively-bid, cost-sharing program to develop nuclear small modular reactor (SMR) technology, NuScale’s design offers the benefits of carbon-free nuclear power but takes away the issues presented by the cost of installing large capacity. A nuclear power plant using NuScale’s technology is comprised of individual NuScale Power Modules™, each producing 50 megawatts of electricity (gross) with its own factory-built combined containment vessel and reactor vessel, and its own packaged turbine-generator set. A power plant can include as many as 12 NuScale Power Modules to produce as much as 600 MWe, gross. The reactor coolant is driven by natural circulation and can be shut down safely with no operator action, no AC or DC power, and no external water. NuScale’s technology also is ideally suited to supply energy for district heating, desalination and other applications.

NuScale is headquartered in Portland, Oregon and has offices in Corvallis, OR; Rockville, MD; Atlanta, GA; Charlotte, NC; and Chattanooga, TN.

Forum on Energy recently spoke with Michael McGough, NuScale’s Chief Commercial Officer.

1. NuScale cites safety as both its foremost priority and its biggest advantage over other small modular reactor designs. The “Triple Crown” of safety distills three of NuScale’s most important safety principles, elimination of the need for (1) operator action, (2) AC or DC power, or (3) the resupply of cooling water. How have lessons learned from the Fukushima disaster impacted NuScale’s emphasis and technical decision-making with regard to reactor safety? Could a seismic event and tsunami cause similar problems for NuScale’s reactors?

As noted, the NuScale plant, with its innovative design, has achieved the Triple Crown for nuclear plant safety: to safely shut down and self-cool, indefinitely, with no operator action, no AC or DC power, and no additional water supplied. The basic design features that enable this were already in place prior to the Fukushima accident in Japan, but NuScale did improve the design based on Fukushima lessons learned. The design at that time could sustain the loss of all AC power (station blackout) without additional water, indefinitely, but still relied at times on DC power. An evaluation of longer coping times resulted in design enhancements that eliminated the need for DC power to reposition valves into their safe position and resulted in the ability to withstand a loss of all AC and DC power.

NuScale uses design-specific probabilistic risk assessment (PRA) tools to improve the safety of the design, including external events assessments such as seismic and flooding. In addition, the USNRC has implemented various enhanced regulations to deal with lessons learned from Fukushima with regard to seismic and flooding risk, and NuScale will meet these new regulatory requirements.

The NuScale design will withstand an event similar to that encountered at Fukushima while meeting all safety requirements.

2. NuScale is actively pursuing opportunities to license and build their reactor in international markets. What are the various advantages of NuScale’s design when applied to different markets – specifically East Asia, Eastern Europe, and the Middle East?

The NuScale Power Module is a scalable modular reactor design that is suited for both small and large markets. It is installed in 50-MWe modules, in groups of up to twelve modules in a single plant. The simplicity of the design and factory fabrication of the NuScale Power Module will make construction more predictable and efficient compared to large reactors. Operations and maintenance will also be simpler based on fewer plant systems and the smaller size of components.

The safety features of the plant will allow its location to be closer to electricity load centers, which can substantially reduce the need to rely on extensive transmission systems. The 50 MWe gross output of each module will more closely match the incremenåtal generation needs to many of the markets. NuScale is designed to load follow and can be used on transmission grids that include renewable energy with variable electrical output. NuScale also has the ability to be used as a heat source for desalination projects or chemical production as deployment expands into some of these regions.

3. Cost has been cited as a major barrier in the commercialization of many different small modular reactor designs. How will NuScale overcome the high fixed and capital costs associated with commercialization? What are the costs per MWhr after commercialization?

NuScale replaces the economy of size with the economy of factory fabrication of the NuScale Power Module and fewer, less complex plant systems, with the result being a more predictable and affordable capital cost. Construction time to completion of the first unit is shorter than the time to construct larger units, also reducing capital costs. Individual units can be added as needed so that investment can be timed to optimally match the energy supply need. Electricity generation can be obtained from the first units as additional units are still being completed producing cash flow earlier compared to large units.

NuScale has determined the total plant levelized cost of electricity (LCOE) based on a detailed estimate of total engineering procurement and construction (EPC) costs and estimates of other costs, including owners’ costs. Using 2015 dollars, the LCOE range for a first-of-a-kind 12-unit plant is $77-$111/MWh depending on cost-of-capital and U.S. taxable status of the project. The LCOE is estimated to be $5-12/MWh lower for nth-of-a-kind deployments in the U.S.

4. How will the size and modularity of NuScale’s design impact refueling? How does the fuel cycle differ from commercial light water reactor technologies? What are the advantages?

Each reactor is designed to operate on a two-year refueling cycle. If a 12-unit plant is built, there would be a refueling outage approximately every 2 months on one of the units. However, due to the NuScale plant having fewer and simpler systems, each outage is expected to last only 10 days. Only a small percentage of overall plant capacity is lost during a refueling because the units that are not involved in the refueling outage can continue to operate at maximum allowable output which results in up to 91.7% plant capacity during refueling outages. Also, refueling outage work will be performed by indigenous plant personnel, as opposed to the current practice of hiring 1000+ temporary outage workers to perform outage services. Similar to current experience with pressurized water reactors (PWRs), NuScale is expected to use a multiple cycle core design where only a portion of the fuel is replaced each outage. There will be fewer fuel bundles(37) and each bundle is half the height of current large PWR reactors.

5. NuScale is hosting an invitation-only event called NuEx this August to showcase their facilities and meet potential investors and stakeholders. This is a new concept for introducing a reactor to potential stakeholders. What can attendees expect to see at NuEx?

The NuScale Power Exposition is designed to showcase NuScale’s industry leading Small Modular Reactor design. Speakers include Dr. Lynn Orr from the US Department of Energy, Dr. Scott Tinker from the critically acclaimed documentary Switch, the CEOs of Utah Associated Municipal Utilities (UAMPS) and Energy Northwest (who will be the owners and operators of the first NuScale plant being developed in Idaho), and world-renowned climate change expert Sir David King. Attendees will have the chance to network with leaders from the utility, investment, political, regulatory and supply chain communities as well as senior NuScale executives. Those attending the NuScale Power Exposition will be given the opportunity to view NuScale facilities- including the advanced control room simulator, a full scale mock-up of the power module upper assembly and the purpose-built NuScale Integral Systems Test facility- and to interface with engineers on the front lines of developing this leading edge SMR design.

6. What are the next steps, aside from licensing, in NuScale’s reactor commercialization?

NuScale has a U.S. customer (UAMPS) that is planning a commercial operation date of their first module by the end of 2023 with the remaining 11 units of a 12-unit plant reaching commercial operation by early 2025. The customer has notified the U.S. NRC that they intend to submit a combined license application (COLA) in the first half of 2017. NuScale will begin final plant design engineering in 2016 and progress in parallel with the customer’s site licensing activities through the first half of 2020. Orders for nuclear plant modules are expected in 2017 and fabrication will begin by the end of 2019. Between now and 2017, NuScale will continue to line up suppliers and make final plans on manufacturing.

NuScale is also engaged with other potential North American customers that are interested in commercial deployment in the 2025-2030 timeframe.