Part 2 of 2 Parts (Please read Part 1 first)
Despite the ambitious aims of data center operators in the U.S. and elsewhere, there is a significant drawback to the employment of SMRs. They are not ready for commercial use, at least for the most part. There are so far only two SMRs operating worldwide. While SMR developers describe their systems in the present tense, most are at least several years away from being ready.
Ed McGinnis is also president and CEO of nuclear fuel recycling company Curio. He said that challenges include high costs and regulatory delays. Most SMR designs are in the early stages with “first-of-a-kind” risks and uncertainties involved. Planning and participation will be required from the federal government to realize the White House’s ambitions.
Joshua Loughman is a systems engineer and Arizona State University data scientist. He said, “SMRs face many of the same challenges that conventional nuclear power faces. SMRs have mostly the same regulatory and permitting challenges, similar supply chain and fuel cycle challenges, challenges with community support and waste management problems. If new advanced nuclear technologies like SMRs are also going to take decades to develop, it may be too little, too late to meet the immediate demands for electricity being forecast.”
Published in January this year, a Goldman Sachs Research report projected a one hundred and sixty percent increase in data center power demand by 2030. Up to eighty-five to ninety gigawatts of new nuclear capacity would be needed to meet that demand – but “well less than ten percent is likely to be available, it continued, and natural gas, renewables and batteries will all have a significant role to play.
Loughman said, “If we could count on many SMRs being ordered, prices could come down; if prices could come down, demand for more orders would go up. This reinforcing feedback loop, supported by a combination of aggressive policy changes (executive orders supporting the nuclear industry, the removal of renewable energy subsidies, and local support), could breathe new life into a mostly lethargic nuclear industry. However, the appetite for electricity is right now, and even the shortened delays in this technology’s development could have electricity customers looking for more immediate solutions in the form of renewables, energy storage, energy efficiency and natural gas generation.”
SMR developers are well aware of the short timeframes required, and intend to deploy quickly. Aalo’s pilot factory is already operating in Austin, producing XMRs designed for rapid deployment. A larger, gigawatt-scale factory could be deployed in two to three years.
Arafat points out that ss the negative effects of climate change accelerate, AI supremacy should not be the only target of expansion plans. With widespread concerns about the technology’s environmental impact, growth of the sector should be as carbon free as possible. A one-hundred-megawatt data center running on natural gas can emit over four hundred thousand tons of CO2 each year.
However, Loughman said that, as the competition heats up, SMR’s other advantages could push them to the front of the pack. He continued, “The case for large corporations… to explore operating their own SMRs comes from their desire for a stable, carbon-free electricity source to power data centers that wouldn’t be at risk of competition with other customers.”