B&W Gets More DOE Funds for Small Modular Reactor Project

The Department of Energy (DOE) has fully allocated funds to support Babcock & Wilcox’s (B&W’s) initial project period for its mPower small modular reactor (SMR) technology.

The North Carolina–based company was the only winner selected in November 2012 of the DOE’s competitively bid SMR Licensing Technical Support Program, an initiative designed to boost the accelerated development of SMRs and help deploy them before 2022. B&W formed the mPower America project team with the Tennessee Valley Authority (TVA) and Bechtel to pursue an award under the program.

The DOE had originally announced that it would award $450 million to one or two designs over five years to assist with licensing and technical support. The exact level of funding to B&W has not been disclosed, though the company has since said that the cost-share award will enable it to accelerate research and development (R&D) spending to meet program milestones and allow it to limit net spending to between $85 million and $95 million in 2013 alone.

On Wednesday, B&W announced that the DOE had allocated $20.5 million in funding in addition to the first installment of $79 million, which was allocated upon the formal signing of cooperative agreement in April 2013. The DOE has also reportedly provided about $2 million to national laboratories to perform evaluation work associated with the project, and the agency has said it will provide additional funding to the project depending on incremental appropriations from Congress. That brings the DOE’s total investment in the project to $101 million.

However, B&W officials told investors in an earnings call earlier in August that it has been “rigorously evaluating and managing spending” on the mPower program, including both R&D expenses and business development and administrative costs. “Through prudent cost management, we expect to lower the company’s net spending in mPower for the full year compared to our previous guidance by approximately $5 million without significantly impacting mPower’s ability to achieve the program’s targeted milestones.” The company said it is engaging with the DOE and with supporters in Congress to ensure the 2014 budget includes “maximum funding.”

At the same time, it is also looking for other potential sources of government funding for the fledgling technology as well as new investors and possible new partners. But negotiating a deal with new partners is complex because of issues surrounding scope, risk, and liability, as B&W CEO and president E. James Ferland admitted. “I would like to get a deal signed in 2013, if we could. I think it’s probably going to take us into 2014 to get that done,” he said.

Future milestones for the project including submittal of the design certification application to the Nuclear Regulatory Commission (NRC) in late 2014. B&W’s partner TVA, which has proposed at least two SMRs for a plant at its Clinch River site in Oak Ridge, Tenn, may also submit a combined construction and operating license application to the NRC in 2015. “In the 2017 timeframe, we expect to receive design certification. We would expect our partner to receive our combined operating license, and that’s the window in which we would expect to sign some actual contracts, perhaps earlier, but that’s probably a conservative estimate,” Ferland told investors.

The 180-MW B&W mPower SMR is based on advanced integral pressurized water reactor technology which incorporates passive safety protection systems within a fully underground containment structure.

As POWERnews has reported, at least three companies are vying for a new $452 million cost-sharing funding opportunity offered by the DOE earlier this year. The competition is heating up between three companies vying for that funding opportunity: NuScale Power, of Corvallis, Ore.; Westinghouse Electric, based in Pittsburgh, Pa.; and Holtec International, based in Marlton, N.J. Sources say the DOE’s decision could be announced as early as mid-September.

For an in-depth look at B&W’s mPower technology, see “ Small Is the New Big: The B&W Small Modular Reactor,” in POWER’s August 2012 issue.

Sources: POWERnews, B&W

—Sonal Patel, Senior Writer (@POWERmagazine, @sonalcpatel)