In quotes: Simon Bowen on UK's 24GW plan and SMR contest
The interview with GBN chairman Simon Bowen took place shortly after the UK government unveiled a roadmap to achieving 24GW of nuclear capacity by 2050, and as the six shortlisted companies (EDF, GE Hitachi, Holtec, NuScale, Rolls-Royce SMR and Westinghouse) await the next stage of the GBN-led selection process for the UK's small modular reactor programme. Here is an edited selection of key quotes:
How significant is the UK government's roadmap for GBN?
I think it's an overwhelmingly positive document, the next stage in the creation of the nuclear programme for the UK. It gives GBN three roles - it talks about GBN running the SMR selection process. It then talks about us taking on broader nuclear delivery, which means that if we do another gigawatt unit it is likely we'll run the selection process and then run the project and also, when advanced modular reactors (AMRs) come to fruition, it is highly likely that we would run that as well. The third role, which is really important, is that we advise government on the development of policy.
What about the Roadmap more generally?
The important thing is the reiteration of the target of up to 24GW with three to seven gigawatts every five years between 2030 and 2044, which I think is very important because it signals the range that we're aiming at. And then the reiteration that we are going to explore another gigawatt reactor after Sizewell, which for me is very, very important, because there is no way that we're going to get to 2050 and 24GW without the whole range and scales of reactors. Some big announcements on HALEU ... it also talks about the importance of regulation and skills and supply chains. Some people may say there's not a huge amount new in there - well there is, and there is the commitment of government to go on and deliver the programme. And it starts to spell out what the heart of that might be. It's a great step forward and a step in the right direction for forming the UK's new nuclear programme, which we will be accountable for delivering alongside our colleagues in Sizewell and Hinkley.
On siting and regulation:
The short-term focus of SMRs on the eight sites declared in the existing national policy statement is an important set of criteria that we are applying, but I think everybody recognises that if you're going to go after 24GW then those sites are simply not going to be enough, because we live on a small island and and we've got to have much more flexibility about the sites that we have access to. We have to allow the market to have access to the sites we are no longer looking at, or, the consultation is suggesting, that we should no longer be looking at the designation of sites, we should be looking at a criteria-based model which allows the developers to identify the sites and the usages they think they need, and then the criteria that they think should be applied, which should give an awful lot more flexibility to the market to deliver market-led projects. The second part is all about how you enable all of that and the whole role of planning, of environmental consenting, smarter regulation and the documentation - there's some really important consultation on those elements because if we don't get those more efficient, we will not be able to deliver on the target of 24GW. So a combination of more sites, simpler processes and more enabling regulation are really, really important.
On prospects of new sites for nuclear in the UK
We are looking at acquiring access to the existing sites for the SMR programme, sites like Oldbury, Wylfa, Heysham, Hartlepool and the others within the existing policy statement. Those are recognised nuclear sites which we can build on at scale - the SMR programme is all about scale and getting as quickly as we can to deliver on energy security and on the journey to net-zero. The views of the wider nuclear population are really important though, because when you look at AMRs, then if you get things like passive safety approved - walk-away safe - on a number of the AMR technologies, the sites that gives you access to is so much broader. And therefore things like the old industrial sites become more readily accessible because they will very likely be in a different regulatory regime, or modified regulatory regime, because the planning zones are going to be so much smaller. So a more flexible approach to allow the private sector to identify these sites where they know they've got the demand that will justify their business case, and a combination of that plus an enhanced regulatory regime, or a modified regulatory regime, for the different types of plants, all of that will start to open up more sites and therefore more output.
Will GBN be involved in the private-sector led initiatives?
When we did the scoping work for GBN, the very clear advice from all of the nuclear systems around the UK, around the world, was that you really do need a government programme, a government-led programme, an underwritten programme to rejuvenate the nuclear industry and get it started again. And that's exactly why GBN has been set up. What that doesn't do for one minute is preclude private developers developing their own projects, and we would want to encourage it. The only reason we haven't done that so far, is just bandwidth. Let's get set up on the journey to energy security and net-zero through the SMR programme, and now we're in a place where we want to really understand when developers tell us that they don't need any support from government, they don't need any money from the government, well tell us more about that, because we really want to understand it. Having market-led projects will absolutely allow the government to fulfill one of its aims, which is to get as much of this off the government balance sheet and out of the public finances as possible. So the sooner we can do that the better and therefore alternative routes to market and market-led projects are one of the major routes through which you'll deliver that. Our level of support would depend on the level of support they suggest - in the short term I think it is highly likely that we would be, as a very minimum, providing a supporting role.On the current state of the SMR contest
I prefer to refer to it as a selection process because although they might be competing, we're selecting what we need. The first thing to say is that we're delighted that we got six highly credible technologies that have come forward and want to be part of our process, which is great. We are at the final stages now (11 January, 2024) of preparing and getting the approvals for the invitation to submit an initial tender document. This is the next stage where all six companies will engage with our contractual documentation in terms of how we think it should be structured. They'll submit the responses in their initial tender, we will then go through a process to down-select to around about four with the aim to be placing contracts later in the year. That process is ongoing, I think the main thing that we are very focused on is absolutely on pace, because we need to move quickly from an energy security point of view and from an international market point of view, but what I'm not prepared to do from the GBN board perspective, is trade pace for rigour. Because rigour in the procurement process can be very, very important. So we are in continual conversations at a board level to say, ‘right, ok, are we really ready to go, do we really have a good understanding of the documents, how they fit together’ because at a point where that's the case then we'll release them. I'm delighted about where we've got to, we've got a great team of people ... we’ve got the right people around the table in terms of the vendors and we have got a mass of stuff to do this year because once we've got the tenders out, we've then got to start pulling together what the development companies might look like.
On development companies
The tender is for the technology all the way through to completion of the regulatory process and final design and completion of design, with then the potential to place a contract. We need an entity that is going to develop the site, a development company, and because we're looking at hopefully more than one technology that we'll be developing, we will be highly likely to be having to pull together more than one development company who will characterise the site, apply for the the consent and the environmental permit, and the nuclear site licence, and then manage the construction and move into operation - and the scale of those is probably about the size of a FTSE 100 company, each one. So these are massive undertakings and we've got all of that to do. It is a hugely exciting time, but actually pretty daunting as well at the same time.
How many of the contenders are likely to be selected?
The initial down-select will be from six to around about four, depending on how things go, and then the documentation says between one and four will be awarded a contract. I think the optimum number is somewhere between two and three, but we will be retaining our optionality and there are some important conversations for us to have with government and the Treasury to determine what, in the policy space, they they are prepared to support.
Will each one chosen be tied to a specific site
At the point where we place the contracts, we will have identified and acquired access to the site. And we will match sites to technology and those sites will have the scale to be able to build multiple SMRs of that technology at that site. So the likelihood is it will be one, two or three in the first stage but then being very clear that if these are successful, as we hope they will be, and they can demonstrate that their costs are going to come down with the second, third and fourth units, and we can convince ourselves it's value for money, then we want to just continue building on those sites. As we've learned internationally, that is the right thing to do ... again subject to the final stages approval, our current view is that we will be placing contracts for more than one (reactor) because what we have to demonstrate is that modularisation works and therefore the investment that is required to build the modular factories.
Will Wylfa be available for SMRs?
I think there is a quite a big policy decision for us to make, which has not been yet made, which is, with the announcement that we are going to explore building another gigawatt scale plant after Sizewell, we've got to be clear about whether we are going to look to identify another site for that, or whether that site should be Wylfa. So there is a debate about whether Wylfa is used for SMRs or gigawatt. Therefore that will drive when we look to acquire access to it.
Is Final Investment Decision still targeted for 2029?
Yes, at the latest 2029. If we could do it before that, then, of course we will.
There's an election coming in the UK, will politics derail plans?
I am very confident that the UK political parties are committed to nuclear being a critical part of baseload power, because every nation that has nuclear capabilities worldwide thinks the same. And the COP28 declaration where 20+ countries have said we’ll triple nuclear by 2050 is massively important for us, so from a macro sense, I think we are in great shape. We've never been in better shape for nuclear, cross-party, I don't think that we will skip a beat in intent. Of course, when there is a change of party, then there is bound to be a little bit of a hiatus as the new team get their feet under the desk and determine how they want to apply their fiscal priorities. Therefore I think the risk is more of scale and pace than whether we do or don't have a nuclear programme. If I was asked to bet money on it I would say that we'll continue with the scale and the pace that we've set out so far, because actually there is no alternative.
General global outlook for nuclear
I think it mirrors what I've just said about the UK - that COP28 declaration was a very important moment in the international nuclear industry and it is one industry, you know, this is not a national industry where you can draw boundaries. Everything we do is international. Now what does that mean? Well, it's a good news/bad news story.The brilliant news is that we will, as an industry, have the opportunity to grow multiple technologies at multiple scales. And all learn from each other. Having moved out of the nuclear industry and come back into it, the thing I love about the industry is everybody wants to learn from everybody else. I've never seen an industry where people have the thirst for learning off each other and are prepared to share. It is almost unique in that sense, so the opportunity to learn and therefore all accelerate and therefore all contribute to combating climate change and net-zero is just hugely compelling and a great opportunity. So on one hand, I'm just very, very proud to be part of that because I think it's got huge potential. The bad side is there's a global demand for capability. And everywhere you look, we all want very similar skills, so although, the nuclear specialist skills are somewhere between 10 and 20% of what we need, the 70/80/90% of the skills we need are skills that can be employed in infrastructure, in carbon capture usage and storage, hydrogen and petrochem. It is a massive market that we're competing with and it’s a global market. So that's the challenge. It is hugely compelling and with massive opportunities, we have really got to get our act together in terms of skills and capability to understand how we're going to deliver on our ambitions globally, and critically, nationally.
What industry can do to help with nuclear's expansion plans
I think the first thing is we've got to act as one industry - unless we share skills and we find mechanisms for sharing skills across the nuclear sector, both in defence and civil and across the boundaries then it's going to be very, very difficult to succeed. I think the other thing is that the private sector, and I can say this because I'm still part of it, we have got as many signals as we need now to invest. We've got to get on with raising the cash to invest in the infrastructure and the skills and the capability that are required. So waiting for a starting gun any longer isn't going to work. That starting gun's been fired. And these announcements are part of that, so, I think we've all just got to trust in the fact that absolutely, this is going to happen, it's got to happen, and we need to be prepared with the right capability and the right capacity ... it's now up to us to deliver.
