A Small Modular Reactors deployment roadmap for the decarbonization of the U.S. power and industrial sectors

Small Modular Reactors (SMRs) are part of the next generation of nuclear reactors, but have yet to be deployed. While applications for those reactors have been qualitatively discussed, no national quantitative analysis of the techno-economic potential of SMRs exists. We construct deployment roadmaps for SMRs across the United States in three applications: electricity generation, industrial hydrogen, and industrial process heat. For each state and industrial facility, we optimize SMR deployment and evaluate their economic and decarbonization potential, and robustly test the sensitivity of our results to SMR capital cost uncertainty. A viable deployment roadmap for SMRs in the U.S. would first target the most profitable industrial applications (process hydrogen for ammonia, steel, and refining) before the H2 PTC expires in 2033. At First-Of-A-Kind (FOAK) capital costs and with the support of the Hydrogen Production Tax Credit, 91 GWe of SMR could be deployed for industrial hydrogen production at high internal rates of return. SMRs deployment for dedicated power production is not economically viable. This first wave of industrial deployment could help bring SMR capital costs down and unlock further profitable deployment for industrial process heat with up to 263 GWe financially viable across the U.S. Deployment is highly contingent on the H2 PTC, without which only 12 GWe of profitable SMR deployment would occur, for process heat. FOAK capital cost escalations above vendor expectations as seen in other pioneer plants could significantly reduce profitable deployment opportunities. At roughly 100\% cost increases, consistent with recent large nuclear reactor experience and electricity generation projects, only 27.5 GWe of SMRs are profitable with the H2 PTC and none without this incentive. Our findings challenge the SMR industry's current emphasis on electricity generation. With the H2 PTC, industrial hydrogen presents a substantial and highly profitable potential for early SMR deployment even with a doubling of capital costs relative to vendor expectations, highlighting the urgency to explore these opportunities