Rolls Royce aims for 2029 UK nuclear generation at sub-GBP60/MWh

London — Rolls Royce believes it can get the cost of new nuclear generation down below GBP60/MWh ($78.60/MWh) with first energy in 2029, the company's chief technology officer Paul Stein said Friday.

An industrial consortium led by Rolls Royce has developed a small modular reactor design with the aim of installing between 10 to 15 units in the UK, using advanced manufacturing processes to pre-fabricate parts.

"We think we can get the cost of a 440 MW SMR down to about GBP1.75 billion," Stein told BBC Radio 4's Today program.

"If you go through the maths on the cost of capital we'll be selling power at below GBP60/MWh, which puts it into the territory of many of the renewables," he said.

Rolls Royce planned to have energy on the UK grid by 2029, a year ahead of previous projections.

"Within the UK, the obvious sites are where we have elderly or decommissioned nuclear power stations, there are two in Wales [Wylfa on Anglesey, Trawsfynydd in Snowdonia], and one in northwest England [Moorside, Cumbria]," he said.

"We are also looking to a significant export market, estimated at GBP250 billion -- this could be a huge industry," he said.

"We're in discussion with a number of foreign governments who have written letters of intent to us, but don't want to go public yet. We're pretty certain that once we get going with this in the UK, foreign orders will come along," Stein said.

Cost-cutting had focused on production of pre-fabricated parts using digital welding and robotic assembly. Parts would be shipped to site and bolted together.

"That hugely reduces capital cost and results in a much cheaper net zero carbon form of generation," Stein said.

In November, the government signed off on GBP18 million of initial support towards RR's GBP500 million SMR program.

"The government has indicated it will put in some money -- less than half," Stein said, adding private equity was now taking an interest alongside consortium member own-funding of the program.

Asked what was different in RR's approach to an old idea that had been dropped by competitors like Westinghouse, Stein said the consortium had focused on whole-project cost and time to delivery, not new design.

"Our desire has not been to create a new nuclear reactor. The design is one we've been running in many power stations around the world," he said.

The government is yet to pronounce on its July-October 2019 consultation on a Regulated Asset Base financing model for new nuclear, similar to that used for large transmission infrastructure.

The Confederation of British Industry has called on the government to adopt a RAB model for new nuclear, including for SMRs.