TVA-led team applies for $800M federal grant for Clinch River small nuclear reactors

The Tennessee Valley Authority is leading a team of nuclear companies and utilities applying for an $800 million federal grant to help finance small modular nuclear reactors at its Clinch River Nuclear Site in Oak Ridge.

The grant could cut the timeline for building the reactors by two years, with a plan for commercial operation by 2033.

TVA, a public utility owned by the federal government, may build up to four 300-megawatt reactors at the site but is focused on bringing the nation's first small modular reactor online.

The all-star team of nuclear companies applying together includes metal forgers and parts suppliers that could return the ability to cast the largest metal components of reactors to the U.S., said TVA CEO Jeff Lyash in an interview.

"It's not about building one reactor, it's about building a fleet of reactors in TVA's footprint, in the U.S. and globally," Lyash told Knox News. "This technology takes federal support to develop and deploy, and that's what this grant is about."

Small modular reactors are not just smaller than large traditional nuclear power plants, but could be built faster and in more places. Nuclear energy is the largest single source of clean energy in the U.S., at around 20% of the electricity supply.

TVA began exploring options for advanced reactors in 2010 and submitted an early site permit in 2016. The project was the first of its kind to receive an early site permit from the U.S. Nuclear Regulatory Commission in 2019, and the TVA Board of Directors has approved $350 million to fund early development.

Here's what else to know about the effort to develop a technology that could help achieve climate goals with reliable electricity.

What makes this nuclear push different?

This isn't the first time a big nuclear project has been planned for the Clinch River Site, a 1,200-acre tract at the far south end of Oak Ridge. It was once home to the Clinch River Breeder Reactor and Babcock & Wilcox and Bechtel's mPower small modular reactors. Both projects were terminated before they were built.

What's different this time? There are multiple factors converging to make this new nuclear renaissance more economically viable, Lyash said:

• The nuclear energy industry enjoys more bipartisan support in Congress than ever
• Electrification of cars and manufacturing, as well as large-scale data centers for AI, are pushing up demand
• The Russian invasion of Ukraine upended the global energy market, proving that reliable energy is part of national security
• Breakthroughs in supercomputing allow utilities to model reactor designs more efficiently
• Ambitious clean energy goals adopted by governments and companies have made nuclear financing a secondary concern
• New large-scale nuclear reactors at Georgia Power's Vogtle plant showed possibilities and pitfalls of new nuclear

“There will be no wishful thinking here, no rose-colored glasses,” Lyash said. “We know that you must be disciplined."

Where will grant money come from?

The $800 million grant is part of the U.S. Department of Energy's Generation III+ Small Modular Reactor Program and will go to one or two teams of utilities and construction partners. TVA does not receive taxpayer dollars to fund its operations, but can access certain grants.

The program's money comes from the Biden administration's Bipartisan Infrastructure Law, though President-elect Donald Trump and his nominee for secretary of energy, oil executive Chris Wright, have signaled support for new nuclear energy.

When will the reactors come online?

TVA has not fully committed to constructing and operating small modular reactors because there's a long permitting road ahead. Here's a possible timeline, according to the utility:

• January/February 2025: TVA will issue an environmental impact statement for public comment
• First half of 2025: TVA will submit a construction permit application to the U.S. Nuclear Regulatory Committee
• August 2025: TVA will ask its board to approve procuring materials, detailed design engineering and construction planning
• January 2026: TVA could begin early site preparations
• July 2026: TVA could begin excavation
• August 2028: TVA could begin nuclear construction
• December 2033: First U.S. small modular reactors at Clinch River Site could begin commercial operation

Who are TVA's partners on small nuclear reactors?

TVA listed 11 partners applying for the grant money, including Bechtel, BWX Technologies, Duke Energy, GE Hitachi Nuclear Energy, Oak Ridge Associated Universities and the state of Tennessee. Private utilities like Duke Energy could become "fast followers," building their own small modular reactors if TVA is successful, Lyash said.

Another key partner for TVA is Ontario Power Generation in Canada, which plans to bring the same design of small modular reactors online by 2029. Both utilities plan to deploy the GE Hitachi BWRX-300.

Why does TVA want new nuclear reactors?

There are four parts to TVA's nuclear strategy:

• Maintaining its existing nuclear power plants: TVA's three power plants supply around 40% of its electricity. The utility will spend around $6 billion to extend the life of its plants.
• Developing BWRX-300 at Clinch River: TVA and its partners want the design to become a global standard.
• Supporting Kairos Power's salt-cooled reactor: TVA is a partner with California-based Kairos, which is building several demonstration reactors in Oak Ridge.
• Keeping the door open at Bellefonte: TVA owns an unfinished nuclear plant at the Alabama site, which was once slated for large-scale Westinghouse AP1000 reactors. Champions of nuclear energy would like to see some built there.

How much will TVA's new reactors cost?

The first reactor at the Clinch River Site could cost $17,949 per kilowatt, or around $5.4 billion for a 300-megawatt plant, according to an estimate in a draft of TVA's long-term energy plan. The cost would sharply decline after the first reactor is built.

TVA can go into debt to finance construction of power plants, but Congress has capped TVA's debt limit at $30 billion. The utility has not issued debt for its small modular reactors yet, but it will when the project moves to a construction phase. Over several years, TVA has driven its debt down to the lowest level in 30 years to prepare for new builds.

Still, Congress may have to raise its debt limit for the first time since 1979 to fund new nuclear plants.

“Because of demand growth and expansion, ultimately, TVA will need access to capital beyond the current debt cap,” Lyash said.

Bonus: Would TVA work with big tech? 'Absolutely'

Tech giants like Amazon and Google have signed partnerships with nuclear reactor developers to power their data centers for AI with clean energy. Would TVA, as a public utility owned by the federal government, enter into an agreement with a big tech company?

"Absolutely," Lyash said. “There's nothing inherent in TVA’s model that prevents it or even discourages it…There is no reason why TVA couldn’t co-own facilities with those partners or others if that’s the best way to build out the system that our 10 million customers need."

Daniel Dassow is a growth and development reporter focused on technology and energy. Phone 423-637-0878. Email daniel.dassow@knoxnews.com.

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