Part 2 of 2 Parts (Please read Part 1 first)
Rising costs should be eased by the tax incentives in the Inflation Reduction Act according to Colbert. The new law allows new reactor owners to claim a twenty-five dollars per megawatt hour production tax credit for a plant’s first ten years of operation. Another option is a thirty percent investment tax credit on plants that begin operations in 2025 of later. There are other credits being offered for plants that meet labor, location, or domestic sourcing goals.
NuScale informed an investor conference last month that federal tax incentives could reduce construction costs of its reactor by as much as fifty percent, if located at a shutdown U.S. coal plant site.
Colbert said that “The IRS has issued dozens of circulars asking for input” on the tax provisions for new nuclear plants. “The devil is in the details. It’s going to take a while for [UAMPS members] to digest what it all means. But we think it will be hugely beneficial.”
In order to keep the UAMPS project on track, developers will not only have to keep existing utility sponsors. They will also have to sign up new sponsors. Twenty-seven of UAMPS fifty member utilities are sponsors of the project. They have agreed to buy one hundred and sixteen megawatts of power. However, Webb said that the entire four hundred and sixty-two megawatts of capacity must be fully subscribed for the project to go forward.
Mason Baker is the CEO of UAMPS. Last month, he said, “We’re going to have to see measured improvement off the current subscription to keep moving forward with the project. We’re very actively doing that.”
NuScale said that it is also in discussions for projects elsewhere in the U.S. as well as in Bulgaria, Canada, Estonia, Jordan, Poland, Romania and Ukraine.
KGHM is a large copper and silver producer in Poland. In February of this year, they agreed to work with NuScale toward deployment of a NuScale reactor as early as 2029. However, the company also lost a potential U.S. customer recently when Washington state’s Grant County Public Utility District decided to instead consider a SMR from X-energy based in Rockville, Maryland.
NuScale will also need to gain design approval from the Nuclear Regulatory Commission for a new SMR design. Its fifty-megawatt design was approved by the NRC two years ago. It will be replaced by a seventy-seven megawatt SMR that it plans to use for the UAMPS and other projects.
Diane Hughes is the NuScale vice president for marketing and communication. She said that the company remains on track to submit the new design application this month. However, NRC staff has raised concerns about the design. They wrote a letter to NuScale that its proposed module raised “several challenging and/or significant issues.” The letter is a response to a draft application NuScale submitted to the NRC seeking feedback on its final application. The letter includes eighteen pages of questions and concerns. NRC staff say that NuScale’s draft application is missing information needed to determine whether the design provides “reasonable assurance of public health and safety.”
Edwin Lyman is the director of nuclear power safety with the Union of Concerned Scientists. He said that the issues raised by the NRC “will take substantial analytical work to fix.” Lyman went on to say that “Although NuScale claims that it is still on track to submit the application by Dec. 31, it is hard to see how that can happen unless the company does a rush job — which will only lead to more revisions and delays down the road. NuScale should take all the time necessary to do a comprehensive and accurate rewrite of the application instead of trying to stick to an arbitrary timeline.”