Small Modular Reactor Market Size, Share, and Growth Forecast for 2024 - 2031

Small Modular Reactor Market Size and Share Analysis

The small modular reactor market is estimated to increase from US$ 5.1 Bn in 2024 to US$ 9.5 Bn by 2031. The market is projected to record a CAGR of 9.1% during the forecast period from 2024 to 2031.

Reducing greenhouse gas emissions is becoming increasingly important as global efforts to address climate change intensify. SMRs offer a steady and dependable supply of low-carbon electricity, making these an essential part of this shift.

SMRs are a desirable alternative for grid stability in areas with varying renewable energy output. They help provide continuous power supply, in contrast to intermittent renewable sources like wind or solar. Rising cases of power outages across the globe, especially in developing countries, are projected to create new opportunities.

In certain areas, outages might happen every week or even every day, lasting anywhere from a few minutes to various hours each time. During seasons of high demand, several areas in countries like Nigeria or India endure outages that last four to twelve hours per day.

Key Highlights of the Market

• The small modular reactor market is set to rise steadily over the next ten years, driven by increasing demand for clean, reliable, and low-carbon energy sources.
• Global energy transition and the need for decarbonization are key factors fueling the market, particularly in regions aiming to reduce reliance on fossil fuels.
• Pressurized Water Reactor (PWR) segment continues to maintain its dominance in the market with a share of 63.6% in 2024 due to adaptability to several energy needs.
• Asia Pacific is likely to hold a share of 80.4% in 2024 backed by rising focus on clean energy across emerging markets.
• Governments worldwide, particularly in the U.S., Europe, and Asia, are increasingly supporting SMR development with favorable policies, funding, and regulatory frameworks.
• Development of unique reactor designs, such as the Natrium, Holtec’s SMR-160, and the NuScale Power Module, is pushing the market forward.

Market Attributes	Key Insights
Small Modular Reactor Market Size (2024E)	US$ 5.1 Bn
Projected Market Value (2031F)	US$ 9.5 Bn
Global Market Growth Rate (CAGR 2024 to 2031)	9.1%
Historical Market Growth Rate (CAGR 2019 to 2023)	6.1%

Asia Pacific Sees Steady Growth Amid Focus on Clean Energy Transition

Asia Pacific small modular reactor market will likely dominate with a share of 80.4% in 2024. This is due to the region's increasing focus on clean energy transition, technological developments, and energy security needs.

Countries like China and India are experiencing rapid industrialization and urbanization, leading to a surging energy demand. Governments are prioritizing low-carbon energy sources to meet decarbonization goals and commitments under the Paris Agreement. For instance,

• China has heavily invested in nuclear technology as part of its strategy to peak carbon emissions by 2030 and achieve carbon neutrality by 2060. SMRs play a vital role in this roadmap as they are cost-effective, deployable in remote areas, and capable of complementing intermittent renewable sources like solar and wind.

SMRs incorporate novel reactor technologies such as molten salt reactors and gas-cooled reactors, which offer improved safety features and scalability compared to traditional large reactors. For example,

• South Korea’s SMART (System-integrated Modular Advanced Reactor) is gaining international attention for its potential to provide safe and efficient power and desalination solutions. These modular units reduce construction times and costs due to factory fabrication. It makes them attractive for countries with small grids or limited financial resources.

Key Decarbonization Goals across Europe to Drive SMR Adoption

Europe is poised to lead the global market due to its strong commitment to decarbonization, robust regulatory framework, and substantial investments in nuclear innovation. Several countries in the region have adopted stringent climate policies aiming for net-zero emissions by 2050, which necessitate reliable, low-carbon energy solutions. Europe is hence anticipated to hold a key share of 16.5% in 2024.

SMRs, with their ability to provide scalable and flexible nuclear energy, align perfectly with these goals. For instance,

• The European Union's (EU) Green Deal emphasizes diversifying energy sources and reducing reliance on fossil fuels, making SMRs a key component of the energy transition.
• Countries like France, which generates over 70% of its electricity from nuclear energy, and the U.K., with its recent investments in unique nuclear technologies, are spearheading SMR development.
• By leveraging these advantages, countries in Europe are well-positioned to set a global benchmark for SMR deployment and integration into sustainable energy systems.

Pressurized Water Reactors Lead due to Superior Safety Features

Pressurized Water Reactors (PWRs) dominate the small modular reactor market with a share of 63.6% in 2024. This is due to their proven technology, safety features, and adaptability to various energy needs. PWR technology has been a cornerstone of nuclear power generation for decades, giving it a strong foundation of reliability and operational expertise. This extensive experience translates into reduced risk for developers and investors, making PWRs an attractive choice for SMRs.

PWRs also utilize water as both a coolant and a moderator, which inherently stabilizes the nuclear reaction. In SMRs, novel safety systems like passive cooling mechanisms further enhance this safety, reducing the need for external intervention in emergencies. For instance,

• NuScale Power’s SMR design, based on PWR technology, includes self-contained modules with natural circulation for cooling. It hence eliminates the need for pumps and external power in certain scenarios.

On the other hand, the Pressurized Heavy Water Reactor (PHWR) segment will likely account for a share of 27.4% in 2024. This is attributed to their ability to utilize natural uranium as fuel, making these highly sustainable and cost-effective.

Market Introduction and Trend Analysis

Small Modular Reactor (SMR) is a unique type of nuclear reactor designed to produce electrical power or heat on a smaller scale compared to conventional nuclear reactors. These reactors are engineered with novel safety features, including passive safety systems that rely on natural phenomena like gravity and convection for cooling, reducing the risk of accidents.

Their compact design and flexibility make them suitable for a range of applications. These include powering remote or off-grid locations, supporting industrial processes, and integrating with renewable energy systems to ensure grid stability. SMRs are considered a pivotal technology in addressing global energy challenges, particularly in the transition to low-carbon and sustainable energy systems.

Governments and international bodies are increasing funding and regulatory support for SMRs. Incentives include streamlining licensing processes and public-private partnerships to accelerate deployment. For instance,

• The U.S. Department of Energy (DOE) has granted funding for SMR projects under the Advanced Reactor Demonstration Program.

SMRs are increasingly being used for applications beyond electricity generation, such as industrial heat supply, desalination, and hydrogen production through high-temperature electrolysis. These applications extend the utility of SMRs, making them attractive for diverse industries and enhancing economic viability.

Historical Growth and Course Ahead

Small modular reactors gained prominence during the historical period due to their unique advantages. These included high scalability, cost-effectiveness, and enhanced safety features compared to traditional nuclear reactors. The focus shifted from research and development to pilot deployments and commercialization.

Countries such as Canada, the U.K., and Russia led initiatives to integrate SMRs into their energy grids. For example,

• Canada launched the Canadian SMR Roadmap, while Russia deployed the Akademik Lomonosov, the world’s first floating SMR. These projects demonstrated the practical viability of SMRs and showcased their potential applications in remote and off-grid regions.

The market recorded a CAGR of 6.1% from 2019 to 2023, indicating steady growth during the historical period.

Organizations such as the International Atomic Energy Agency (IAEA) and the Organization for Economic Cooperation and Development’s Nuclear Energy Agency (OECD-NEA) supported knowledge-sharing initiatives to accelerate SMR adoption globally. Bilateral agreements between countries facilitated technology transfer and collaborative projects. These contributed to the broader acceptance and deployment of SMRs.

Increasing number of projects entering novel development stages is pushing demand for SMRs as these are playing an important role in the energy transition. At the same time, these are offering solutions to decarbonize hard-to-abate sectors, support industrial applications, and provide energy resilience. In the forecast period, the market is projected to witness a CAGR of 9.1% from 2024 to 2031.

Market Growth Drivers

Rising Investments in Design and Near-term Deployment Projects Spur Demand

There is a rising interest in small and simple units for generating electricity from nuclear power, and for processing heat. This demand is primarily motivated by the desire to reduce capital costs and provide energy solutions for areas not connected to large grid systems. The development of SMR technologies is highly diverse, with significant progress being made in Western countries. These are set to be fueled by private investments and involvement of small-scale companies.

A key factor pushing the market's growth is the shift from government-led nuclear research to private sector-driven innovations. Entrepreneurs with a strong focus on social purpose are leading this transformation, with a primary goal of deploying affordable, clean, and carbon-free energy solutions.

The shift is also supported by the International Atomic Energy Agency (IAEA), which, in 2020, published an update on SMR technology developments, showcasing over 70 designs from various developers. Additionally, several SMRs are emerging that require fuel enrichment at the higher end of Low-Enriched Uranium (LEU), specifically up to 20% U-235, further driving technological developments in the industry.

Surging Demand for Safe and Low-carbon Footprint Reactors to Push Growth

The world faces increasing pressure to transition away from fossil fuels, and SMRs offer a promising alternative by delivering nuclear power in a more compact and flexible design. These reactors are not only seen as a solution to the need for clean energy sources but also as a means of reducing greenhouse gas emissions, which is essential for meeting international climate targets.

Modern reactor designs incorporate passive safety systems that require minimal human intervention and can automatically shut down in case of an emergency, reducing the risk of accidents. This is crucial in addressing public concerns about nuclear safety and improving the perception of nuclear energy.

SMRs are also designed to be more resilient to natural disasters and external threats, making them ideal for locations that have previously been unsuitable for conventional nuclear power plants. As such, governments and energy companies are increasingly looking to SMRs as a safer and more reliable energy solution for both developed and emerging markets.

Market Restraining Factors

Licensing and Commissioning Challenges to Limit Demand

Governments across various nations closely monitor the development of SMRs, conducting extensive safety and environmental assessments before granting the necessary approvals. Licensing presents a considerable challenge for SMRs. The costs associated with design certification, construction, and operational licenses do not necessarily differ significantly from those of large reactors. For example,

• Several developers have engaged with the Canadian Nuclear Safety Commission’s (CNSC) pre-licensing vendor design review process. This process identifies key barriers to obtaining licensing for new reactor designs in Canada and ensures that clear resolution pathways are available.
• The pre-licensing review consists of two phases. Phase 1, which involves approximately 5,000 hours of staff time, focuses on evaluating the conceptual design and is charged to the developer.
• Phase 2, which requires nearly twice the amount of time, addresses the system-level design of the reactor.

Competition from Alternative Energy Sources to Hamper Adoption

As an emerging technology, SMRs must contend with both established and rapidly evolving energy alternatives. These include renewable energy sources such as solar, wind, and hydroelectric power, as well as conventional fossil fuels like coal, natural gas, and oil.

The competitiveness of SMRs depends on their ability to provide cost-effective, reliable, and efficient energy production in comparison to these alternatives. Key factors influencing this competitiveness include energy storage capabilities, grid integration, and the environmental impact of SMRs.

Renewable energy sources, in particular, have gained considerable momentum due to their low operating costs, minimal greenhouse gas emissions, and reduced reliance on finite resources. However, these technologies face their own set of challenges, such as intermittency in power generation and the requirement for substantial land areas. Conversely, fossil fuels continue to dominate the energy landscape due to their well-established infrastructure and relatively low initial capital costs.

Key Market Opportunities

Increasing Focus on Grid Flexibility and Integration to Create Avenues

SMRs, with their scalable design and adaptable output, offer a unique solution to modern grid demands. By integrating with renewable energy sources, SMRs can provide consistent baseload power while accommodating the intermittent nature of solar and wind energy. These help in ensuring grid stability even during peak or fluctuating demand periods. For instance,

• In countries with aggressive renewable energy targets, such as Canada and Finland, SMRs are being considered as a key component of hybrid energy systems. These reactors can complement renewable energy by ramping their output up or down to balance the grid when renewable sources are unavailable.

Grid flexibility has further enabled SMRs to participate in demand-side management initiatives. For example,

• NuScale Power’s VOYGR SMR design allows utilities to scale power generation in increments as small as 77 MW, enabling rapid response to dynamic grid requirements.

The capability supports the integration of Distributed Energy Resources (DERs), such as energy storage systems and Electric Vehicle (EV) charging networks. These are set to help in making SMRs a critical component in modernizing energy infrastructure.

High Demand for Clean Energy to Forge Novel Opportunities

Countries globally strive to transition from fossil fuels to sustainable energy sources. SMRs have emerged as a viable solution to meet clean energy goals while addressing challenges like grid flexibility, scalability, and economic feasibility. These compact, factory-fabricated nuclear reactors offer a safer and cost-effective alternative to traditional nuclear power plants, making them attractive for governments and private investors alike. For example,

• Through partnerships with companies like Terrestrial Energy and GE Hitachi Nuclear Energy, the government of Canada is supporting the deployment of SMRs. It aims to replace coal-based power generation, particularly in remote and off-grid areas. This initiative demonstrates how SMRs play a pivotal role in decarbonizing the energy mix while promoting energy security.

The scalability of SMRs is attracting attention in emerging markets where large-scale nuclear power plants are not feasible. For example,

• Poland plans to integrate SMRs to reduce its dependence on coal while ensuring a stable power supply. This strategy aligns with the European Union’s (EU) climate policies and highlights the role of SMRs in enabling energy transitions in regions with constrained infrastructure.

Competitive Landscape for the Small Modular Reactor Market

Companies are investing heavily in research and development to create unique reactor designs that enhance safety, efficiency, and cost-effectiveness. For instance, various firms focus on passive safety features that reduce the need for human intervention, minimizing risks associated with traditional nuclear reactors.

Some are working on unique reactor types, such as molten salt reactors or liquid metal-cooled reactors, to offer diverse solutions tailored to different energy needs. Proprietary technologies and intellectual property portfolios are vital to establishing a competitive edge.

Recent Industry Developments

• In January 2024, Westinghouse Electric Company, based in the U.S., signed an agreement with the Czech Power Industry Alliance. The agreement plays a critical role in leveraging the Czech Republic’s highly skilled nuclear industry in support of Westinghouse and Bechtel’s proposal to deploy AP1000 reactors in country.
• In March 2023, U.S.-based BWX Technologies, Inc. bagged an engineering contract from GE Hitachi Nuclear Energy (GEH) for its BWRX-300 Small Modular Reactor (SMR) Reactor Pressure Vessel (RPV). The BWRX-300 is a 300 MWe water-cooled, natural circulation SMR with passive safety systems that leverages the design and licensing basis of GEH’s U.S. NRC-certified ESBWR. Through innovative design simplification, GEH projects the BWRX-300 will require significantly less capital cost per MW when compared to other SMR designs.
• In March 2023, Finland-based Fortum and London-based Rolls-Royce SMR entered a Memorandum of Understanding (MoU) to collaboratively assess the potential for deploying SMRs in Finland and Sweden. This agreement forms a key component of Fortum’s feasibility study on new nuclear development. It is aimed at evaluating the conditions and requirements for nuclear newbuild projects in these countries.
• In January 2023, U.S.-based GE Hitachi Nuclear Energy (GEH), signed a contract with Canada-based Ontario Power Generation (OPG), SNC-Lavalin, and Aecon for the deployment of a BWRX-300 SMR at OPG’s Darlington New Nuclear Project site. This is the first commercial contract for a grid-scale SMR in North America.

Small Modular Reactor Market Report Scope

Attributes	Details
Forecast Period	2024 to 2031
Historical Data Available for	2019 to 2023
Market Analysis	US$ Billion for Value
Key Regions Covered	North America Europe Asia Pacific Rest of the World
Key Market Segments Covered	Type   Region
Key Companies Profiled	China National Nuclear Corporation BWX Technologies Inc. GE Hitachi Nuclear Energy Mitsubishi Heavy Industries Ltd Bechtel Corporation Holtec International General Atomics Rolls-Royce plc Nuclear Power Corporation of India Limited NuScale Power, LLC Korea Electric Power Corporation Westinghouse Electric Company LLC Terrestrial Energy Inc. Moltex Energy
Report Coverage	Market Forecast Company Share Analysis Competition Intelligence DROT Analysis Market Dynamics and Challenges Strategic Growth Initiatives
Customization and Pricing	Available upon request

Small Modular Reactor Market Segmentation

By Type

• Pressurized Water Reactor (PWR)
• Pressurized Heavy Water Reactor (PHWR)
• Others (MSR, FNR, LWRG, HTR)

By Region

• North America
• Europe
• Asia Pacific
• Rest of the World

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