The “Ultimate Solution” for Powering AI? An In-depth Look at SMR (Small Modular Reactor Technology)

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Author: Dong Jing

Source: Hard AI

Against the backdrop of accelerating global electricity demand, Small Modular Reactors (SMRs) are becoming the key solution to meeting the needs of data centers, industrial manufacturing, and electrification.

On October 18, JPMorgan stated in its latest research report that this technology, through design simplification, standardization, and factory manufacturing, attempts to break through the economic and construction bottlenecks of traditional large-scale nuclear power plants, paving a new way for clean baseload power supply.

According to JPMorgan, there are currently 99 SMRs under active development worldwide, but only 7 are under construction or operational. Gas-cooled and water-cooled SMR concepts are leading in recent deployments. The International Energy Agency (IEA) predicts that, if deployment goes smoothly, by 2040, SMRs could account for 10% of global nuclear installed capacity, with the United States contributing 20% of that growth.

The research report points out that executive orders during the Trump administration injected strong momentum into SMR development. New policies list civilian nuclear energy as a national and economic security priority, require federal agencies to speed up advanced reactor deployment, streamline regulatory review, and open up government fuel reserves. Regulatory reforms will compress permit review times to 18 months, with a goal of commissioning three advanced reactors by July 2026, while expanding investment and production tax credits, significantly improving project economics and reducing permitting risks.

However, JPMorgan believes that the successful deployment of SMRs still depends on various factors such as government support, technological iteration, supply chain construction, and regulatory approval. Next, we will analyze in detail the SMR technology that may become the ultimate solution for AI power supply through JPMorgan's research report.

Core Advantages and Market Positioning of SMR Technology

According to the research report, SMRs redefine the scope of nuclear energy applications through five core characteristics:

Miniaturized design allows flexible deployment in a variety of settings; modular construction supports onsite assembly to lower costs; can be installed both off-grid and on-grid; fuel cycles as long as 30 years; built-in passive cooling mechanisms to simplify design and reduce costs.

According to the Nuclear Energy Agency (NEA), SMR developers are mainly headquartered in the US, Canada, and Europe. By reactor concept, the recent market is dominated by water-cooled reactors, holding the largest market share, followed by gas-cooled and molten salt-cooled designs. From the perspective of site owners, utility companies, industrial users, and government agencies are the main customer groups, and demand from data centers is rapidly increasing.

The unique value of SMRs lies in meeting diversified energy needs. High-temperature gas-cooled reactors can provide process heat above 750°C, suitable for hydrogen production, district heating, and industrial applications—markets that traditional large reactors cannot easily cover. Fast-spectrum SMR designs, though regulatory progress is limited, have significant technical advantages in fuel efficiency and cost control, covering concepts such as gas cooling, heat pipe cooling, metal cooling, and molten salt cooling.

Main Technology Routes and Development Progress

SMR technology is divided by coolant type into five main concepts: water-cooled, molten salt-cooled, gas-cooled, heat pipe-cooled, and metal-cooled. Water-cooled reactors represent most recent concepts, among which Light Water Reactors (LWRs) are closest to near-term deployment. Heat pipe and metal-cooled reactors are at the leading edge of technological development.

Light Water Reactors use mature technologies, including Boiling Water Reactors (BWR) and Pressurized Water Reactors (PWR). NuScale’s 50 MW and 77 MW PWR designs are the only SMRs to obtain standard design approval from the US Nuclear Regulatory Commission (NRC), leading in the regulatory process. GE Hitachi Nuclear Energy’s BWRX-300 has been submitted by the Tennessee Valley Authority (TVA) for a construction permit application, becoming the first US utility to submit an SMR construction permit.

High-temperature Gas-cooled Reactors (HTGR) use helium gas as a coolant. Ceramic-coated fuel can generate high temperatures of around 750°C. The main developers in this field are X-Energy’s Xe-100 (80 MW), Ultra Safe Nuclear’s MMR (5 MW), and Radiant’s 1 MW design. These reactors perform excellently in industrial applications but are limited by a shortage of high-assay low-enriched uranium (HALEU) fuel.

Molten Salt Reactors (MSR) use a fluoride salt mixture as both fuel and coolant, which can operate at high temperatures and achieve efficient heat transfer. Key projects in this area include Kairos Power’s 140 MW FHR, Natura Resources’ MSR-100, Terrestrial Energy’s 195 MW integrated molten salt reactor, and TerraPower’s 345 MW thermal reactor. Kairos has received an NRC construction permit, becoming the first US company to receive a fourth-generation SMR construction permit.

Sodium-cooled Fast Reactors (SFR) use liquid sodium as a coolant, operate in a fast neutron spectrum, enabling fuel reuse and reduced nuclear waste. Major projects include Arc’s ARC-100 (100 MW), Oklo’s Aurora-INL (75 MW), and TerraPower’s Natrium (345 MW). TerraPower’s Natrium project is expected to be commissioned in 2032.

Heat Pipe Microreactors use heat pipes to achieve high thermal conductivity, with effective heat transfer rates between 5,000 and 200,000 W/m. Westinghouse’s eVinci microreactor (5 MW), Oklo’s Aurora Powerhouse, Antares Nuclear’s R1 microreactor, and Radiant Industries’ Kaleidos microreactor (1.2 MW) are under development.

Regulatory Environment and Deployment Timeline

According to JPMorgan, US nuclear plants must undergo NRC safety, environmental, and antitrust reviews, receiving early site, design, construction, and operating permits. The traditional Part 50 path uses a stepwise licensing process—first construction, then operation. The Part 52 path, introduced in 1989, allows applicants to obtain a combined construction and operating license (COL) under certain conditions, reducing default risk and improving certainty.

Regulatory reforms under the Trump administration significantly accelerated approval processes. Executive orders require the Department of Energy and NRC to set 18-month review windows; after successful completion of the pre-application phase, some new designs could complete approvals within 12 months. The NRC's combined license method further shortens approval time by reviewing only "increments" between newly submitted and already approved designs.

According to the JPMorgan report, currently, NuScale’s 50 MW and 77 MW light water PWR designs are the only SMRs with NRC standard design certification.

Kairos Power received a fourth-generation SMR construction license in December 2023, will start construction in July 2024, and aims to be operational by 2027.

TVA became the first US utility to submit a construction permit application for GE Vernova-Hitachi’s BWRX-300 SMR technology.

Most competitors are still at the pre-application or pre-design license application stage.

Surging Data Center Power Demand Creates Market Opportunities

JPMorgan believes that hyperscale cloud service providers (Amazon, Google, Meta) may directly support SMR projects to meet clean energy data center demand. Google has already signed with Kairos Power to ensure SMR will go online by 2030 and reach 500 MW installed capacity by 2035.

The Department of Energy has listed sodium-cooled fast reactors, high-temperature reactors, and molten salt reactors on its 2030 deployment watchlist. Among 25 SMR projects tracked by the World Nuclear Association, stages include pre-investment, cooperation agreements, project links, final investment decisions, or under construction. Kairos Power's Hermes molten salt-cooled reactor is the only project currently "under construction".

NuScale, Oklo, Westinghouse, TerraPower, and X-Energy are the most active developers. These companies are advancing project financing and site selection by partnering with major utilities, industrial users, and government agencies. Some projects have obtained loan approval and technical investment agreement support from the US Department of Energy.

Commercialization Still Faces Multiple Challenges

JPMorgan points out that the numerous technology routes result in intense competition, potentially hindering any single technology from reaching commercial critical mass. While regulatory frameworks are evolving, they often lag SMR technology diversity and novelty, especially for non-water-cooled and advanced designs, which face licensing uncertainty and delays.

Uneven supply chain readiness is a major bottleneck. Many new fuel forms and reactor components have not yet achieved commercial-scale production. Limited HALEU fuel supply poses a major obstacle for many advanced SMR concepts. According to the Nuclear Energy Institute (NEI), North American demand for HALEU will grow rapidly, but building supply capacity takes time.

Economic viability is yet to be proven. Although SMRs seek economic advantages through factory manufacturing and modular design, first-unit costs and scale economies remain key challenges. BloombergNEF analysis shows significant differences among developers in financing, regulation, project, and schedule progress. NuScale leads in regulatory approval, while X-Energy and Oklo perform strongly in project pipeline and customer numbers.

International cooperation is crucial for accelerating SMR adoption and scalability. Most global SMR projects are concentrated in North America, with over 30 projects in various development stages in Canada and the US. Ontario Power Generation’s 1.2 GW Darlington Nuclear facility, in cooperation with GE Hitachi, is scheduled to start operation in 2029 and will be the first SMR project launched in the Western world.

This article is from WeChat official account “Hard AI”. For more cutting-edge AI news, go here

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