The CEO of Rolls-Royce, Tufan Erginbilgiç, has recently cautioned that the UK government could risk having vital supply chains for small nuclear reactors established outside the country. This situation might occur if the government does not select the companies to develop these reactors by the end of June.
Erginbilgiç pointed out that the UK could face a scenario similar to what happened during the offshore wind energy boom over the past decade, where it fell behind other European nations in producing key components for turbines. Rolls-Royce was one of four companies shortlisted by the government last year to create small modular reactors (SMRs), but the competition has faced delays. The state-owned energy company, Great British Energy, may announce two winners by spring.
While any further delays could hinder Rolls-Royce’s plans, the bigger concern lies with the supply chain for the UK, as stated by Erginbilgiç. He emphasized the importance of not delaying the decision any longer and urged for the selection to occur by June.
SMRs, which are smaller than traditional nuclear power plants, hold potential for providing a stable supply of electricity to meet increasing demand without carbon emissions. The UK government is keen on these reactors for this reason.
Officials believe the scale and modular nature of SMRs could lead to avoiding the budget overruns and delays that have plagued large-scale nuclear projects in recent years. SMRs’ significance has grown, particularly as tech giants like Amazon and Google have sought power supply agreements for their energy-intensive operations.
Rolls-Royce’s SMR has a generating capacity of 470 megawatts, which is on the higher end for this type of reactor, as most have capacities of 300MW or less. The company has also been chosen as the preferred supplier in the Czech Republic, having sold a minority stake in its SMR division to the Czech utility ČEZ. The first reactor is planned to be located near the Temelín nuclear power plant in Southern Bohemia, with construction anticipated in the mid-2030s.
Should Rolls-Royce be chosen for the UK project, Erginbilgiç indicated that the company would aim to work on projects both in the UK and Czech Republic simultaneously. He mentioned that if the UK government continues with its SMR strategy, up to 70% of the supply chain could be sourced domestically. Despite initial speculation about potentially shutting down the SMR division, Erginbilgiç has shown ongoing support for it since taking the helm of Rolls-Royce in January 2023.