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AUSTIN — A new study by the Bureau of Business Research (BBR) at the IC² Institute predicts significant economic impacts over the next 30 years across the State of Texas with the development of a small modular nuclear reactor (SMR) industry.
The BBR study evaluates the impact of both the manufacture and deployment of SMRs in Texas and shows significant economic impacts to the state — including an annual average of 148,000 people employed directly and indirectly by a new SMR industry; $50.6 billion in new economic output in Texas; and $27.3 billion in income to Texas workers.
To date, there are no SMRs in use in the U.S.; however, several states are giving SMRs serious consideration as the need for diversity in power generation and reduced carbon emissions intensifies. Texas is one of the first states to conduct such a detailed economic impact study of a potential SMR industry, according to BBR Director Bruce Kellison.
Unlike traditional large nuclear reactors, SMRs can be bundled together to generate large amounts of low-carbon, baseload electricity on much smaller sites. These smaller-scaled reactors can even be located “behind the meter” to generate power and heat for a single large industrial customer. Additionally, SMR components can be factory-assembled and transported off-site, creating the possibility that a given location could become a manufacturing center and exporter of components to other states.
Could Texas build on its energy and chemical manufacturing strength to develop an SMR industry? The BBR study found the state’s large construction and engineering workforce would make Texas a national leader in establishing and maintaining a strong SMR supply chain.
As part of its analysis, the BBR surveyed manufacturing businesses and economic development officials across the state. Kellison said that respondents consistently cited the need for new sources of steady, reliable power, and, even at this early stage, there is some excitement around participating in a fledgling SMR supply chain.
“Our findings confirmed our hunch that Texas could build on its existing manufacturing strengths to develop this industry, and that despite plenty of unknowns, there seems to be a lot of interest in making this happen.” – Bruce Kellison
Whether or not Texas officials would opt to deploy SMRs to meet any part of the state’s energy demand is a separate issue. The Texas electricity market will require that SMR nuclear power be priced competitively relative to existing technologies.
Estimates of capital and operational expenditures necessary to produce power from SMRs show that, until 2040, and under current forecasted energy supply and demand, there remains a sizable gap between the cost to produce SMR-generated power and the market price for power. This gap suggests that incentives may be needed to encourage investment in the first set of reactors.
The Bureau of Business Research, a research unit at the IC² Institute at The University of Texas at Austin, has been conducting nonpartisan, critical analysis of economic and social trends since 1926. The economic impact study is part of a larger exploration undertaken by the Public Utility Commission’s Advanced Nuclear Working Group. The impact study is an initial offering; report authors will follow up with an updated report later this year.
Report authors include Bruce Kellison, Matt Kammer-Kerwick and Jim Jarrett (all of the Bureau of Business Research at the IC² Institute); Brian Lewandowski (Leeds School of Business, University of Colorado at Boulder); Michael E. Webber, Rob Kasten and Joshua Rhodes (all of Webber Energy Group at the University of Texas at Austin), Brian Bloom; Jackson Edgar.
MEDIA CONTACT
Bruce Kellison
Director, Bureau of Business Research at the IC² Institute
512-475-7813