At a very general level, SMRs could be divided into two major categories: traditional land-based nuclear power plants and transportable (e. g. barge-mounted) plants. Land-based SMRs could be assembled on-site (like large reactors) or fabricated and assembled in full at a factory. These options have very different effects on the competitiveness of each particular project.

Factors influencing capital investment costs

One of the main factors negatively affecting the investment component of LUEC for all SMRs is the economy of scale. Depending on the power level of the plant, the specific (per kWe) capital costs of SMRs are expected to be tens to hundreds of percents higher than for large reactors. While the lack of economy of scale increases the specific capital costs and, therefore, the total investment, other SMR features are put forward by the designers to improve their economic outlook:

• Construction duration. According to the vendors’ estimates the construction duration of SMRs could be significantly shorter compared to large reactors, especially in the case of factory-assembled reactors. This results in an important economy in the costs of financing, which is particularly important if the discount rate is high (the specific capital costs could be reduced by up to 20%).

• First-of-a-kind factors and economy of subsequent units on the site/multi-module plants. According to reported experience, the FOAK plants are 15-55% more expensive than the subsequent serial units. Building several reactors on the same site is usually cheaper than building a NPP with a single reactor. These factors apply both to large reactors and SMRs. However, if the overall capacity requirement for the site is limited to, say, 1-2 GWe, the effects of learning in construction and sharing of the infrastructure on the site will be stronger if building several plants. The reduction in effective (per unit) capital cost of SMRs could be 10-25%.

• Economy of subsequent factory fabricated units. In contrast to large reactors, some SMRs could be fully factory manufactured and assembled, and then transported (in the assembled form) to the deployment site. Factory fabrication is also subject to learning which could contribute positively to a reduction in capital costs of SMRs and in the investment component of the LUEC. The magnitude of the effects of learning in factory fabrication of SMRs is considered to be comparable to that of the effects for on-site built plants (up to 30-40% in capital cost reduction, on the total). [2]

• Full factory fabrication of a barge-mounted plant. According to the vendors’ data, a full factory fabricated barge-mounted NPP could be 20% less expensive compared to a land — based NPP with a SMR of the same type. The corresponding improvement of the LUEC would, however, be limited to 10% because of increased operation and maintenance costs for a barge-mounted plant.

The possible impact of the factors above and their combined action were assessed though a number of case studies presented in this report. However, even if all of the above mentioned factors are taken into account, the investment component of the LUEC for a SMR would be at least 10-40% higher than in the case of a NPP with a large reactor in the same country.

Another notable feature of SMRs is that the total overnight costs are significantly lower (in absolute value) than the costs of large NPPs. This could make them attractive for investors in liberalised energy markets and to countries willing to develop their nuclear programme but having limited financial power.

Also, SMRs allow for incremental building which reduces considerably the capital-at-risk, compared to conventional large nuclear power plants.