Shutterstock Save for later Print Download Share LinkedIn Twitter NuScale's imminent debut as a publicly traded company comes amid increasing questions over the economic competitiveness of small modular reactors (SMRs), and their suitability for integration with renewables. By going public, the Fluor subsidiary will face wider and more immediate scrutiny as it seeks to convince investors it can deliver on claims regarding its inaugural US SMR project that critics say are unachievable. As one of the early SMRs planned for deployment this decade, its success or failure could prove a bellwether for the SMR movement.Next week, on Apr. 28, Spring Valley Acquisition Corp. shareholders are expected to approve a proposed "business combination" with NuScale Power, under which Spring Valley would become NuScale Power Corp., allowing NuScale shares and warrants to be listed on the New York Stock Exchange. This transaction will result in NuScale "being the first publicly traded company focused on SMR technology," according to an Apr. 8 release. NuScale's success as a publicly traded company largely depends on the outcome of its inaugural SMR project in the US, which as currently planned would consist of a six-module VOYGR plant with 462 megawatts of power, built at the Idaho National Laboratory. The project will be watched closely not only by NuScale's multiple corporate investors hoping for a slice of the vendor pie in this and other future SMR projects, but also by countries like Poland planning its own NuScale SMR, or Kazakhstan which is contemplating a similar plan. Like other early SMR projects — GE Hitachi's BWRX-300 SMR in Canada could be deployed in 2028, a year earlier than the first VOYGR — it will also influence thinking about other SMR and advanced reactor projects, particularly insofar as they are able to integrate with renewables or provide power in the form of heat or steam to support non-grid applications such as water desalination or chemical production. Cost Challenges Two recent reports suggest that NuScale will not be able to profitably deliver electricity at its agreed target price for Utah Associated Municipal Power Systems (Uamps) of $58 per megawatt hour, and has even less chance of doing so in load-following mode. Load-following requires complex power maneuvering in response to fluctuations in power demand and supply, and has become particularly relevant with respect to variations in supply from intermittent renewables. NuScale's target price for the so-called Carbon Free Power Project (CFPP) is the basis on which Uamps is selling its member utilities offtake agreements for the plant's power. The price assumes a 95% lifetime capacity factor, a feat which no power reactor in the US has ever achieved and one that makes load-following a challenge. NuScale's own construction cost estimates have climbed in recent years — in mid-2020 they stood at roughly $6.1 billion for a 12-module 720 MW plant, with one of the company's outside advisors cautioning that they could go anywhere from "minus 10" percent to "plus 30%" of the current estimate, and "that's not a trivial amount" given that every $100 million "equates to about $1/MWh." Since then the project has been modified to a six-unit plant with 77 MW modules. In response to questions from Energy Intelligence, NuScale said that it was sticking by its target price for the Uamps project, but that for future projects the price might differ. "Based on the overnight cost estimate of an nth-of-a kind plant built in the southeast U.S. at a generic greenfield site, the levelized cost [of electricity] estimate (LCOE) is in the range of approximately $40-$65/MWh depending on the financial profile of the customer," a spokesperson wrote in an email. But the spokesperson also said that NuScale is still fine-tuning its estimates, with several steps to go before it reaches final figures for the inaugural plant. Because of its technological complexity and first-of-its-kind status, "it is reasonable to expect that the actual construction cost could easily be far more than 50% higher than NuScale's current estimate," according to a February report by the Institute for Energy Economics and Financial Analysis (IEEFA). A report from MIT published in 2021 suggests total overnight costs for the first-of-a-kind NuScale project are above $7,000 per kilowatt, with the amount varying depending on the module capacity and number of modules. The report points out that the per-unit capacity cost decreases with each uprate—NuScale started with a 50 MW module and subsequently increased it to 60 MW and finally to 77 MW. One of the report's authors, Koroush Shirvan, told Energy Intelligence in an email that applying conventional assumptions (including 20-year financing) to NuScale's inaugural six-module plant delivers an LCOE of approximately $200/MWh. "Any new nuclear energy technology will struggle to meet $58/MWh in this decade. With low interest rates (<4%), 25% subsidy, small operating staff and taking into account the plant lifetime of 80 years then approximately $70/MWh is possible for the first-of-a-kind plant."Load-Following NuScale and other SMR and advanced reactor developers have heavily promoted load-following capability as an attribute they can offer more readily than larger conventional reactors. Load-following options for SMRs are essentially the same as what they are for conventional reactors, introducing numerous operating challenges, and putting further upward pressure on power costs. "The problem for NuScale is while its SMR technically may be able to both operate at a high capacity factor and load follow; it decidedly cannot do both at the same time," says the IEEFA report. "The target price of power from the SMR would jump to $72 per MWh if its capacity factor were 75% or to $141 per MWh if its annual capacity factor were assumed to be only 36.6% due to load following." NuScale claims its design "incorporates several design features that enhance its responsiveness to load-following" — allowing the reactor to power down to 40% using only control rod movement, according to a 2015 paper written by executives at NuScale, Energy Northwest, which had been the planned CFPP operator, and Uamps. The condenser "is designed to accommodate full steam bypass, thus allowing rapid changes to system output while maintaining full power." For lengthier periods, modules can also be powered lower or shut down altogether. Based on the results of a "hypothetical study," however, the paper noted a number of technical challenges associated with load-following, including the likelihood of faster component degradation, a need for increased staffing, and an increased waste heat load when steam is "dumped" to lower overall power levels."From an economic perspective, it is preferable to not throttle back the nuclear plant or dump steam, but rather sell the excess electricity," the paper's authors conceded. "Ultimately, it will be economics, policy mandates and regulatory requirements that will drive the decision regarding the extent of load-following by the nuclear plant in an integrated nuclear-renewable environment." For its US project, NuScale told Energy Intelligence that "we expect the CFPP to be primarily a baseload operated plant." It also stuck by its capacity factor promise, citing "a short refueling outage duration, multi-module configuration, and exceptional reliability" and "fewer and simpler systems, resulting in fewer potential failures."