Technoeconomic competitiveness of small modular reactors across U.S. power and industrial sectors

Small Modular Reactors (SMRs) are next-generation nuclear reactors proposed for United States deployment, but pathways for early scale-up remain uncertain. We present a large-scale, site-level quantitative assessment of SMR deployment potential across electricity, industrial heat, and hydrogen applications, evaluating economic performance, decarbonization potential, and sensitivity to capital-cost uncertainty. Deployment before the Inflation Reduction Act Hydrogen Production Tax Credit expires in 2033 is most attractive for industrial hydrogen production in ammonia, steel, and refining. At first-of-a-kind capital costs with the credit, 91 gigawatts electric of SMRs could be deployed at high internal rates of return, whereas dedicated power production is uneconomic. Profitable deployment is highly dependent on the credit which could expand future industrial process heat opportunities and maintain viability under doubled capital costs, consistent with recent large nuclear generation projects. These findings challenge the industry’s wholesale-electricity focus and underscore the urgency of evaluating these opportunities. U.S. Small Modular Reactor deployment is highly profitable for industrial hydrogen applications thanks to the hydrogen production tax credit from the Inflation Reduction Act which ensures high profitability under high and uncertain capital costs.