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UK's first small nuclear reactor deal 'poised' for signing but not with Rolls-Royce

Rolls-Royce Holdings PLC - F

The mouth of the Tees

Small modular nuclear reactors (SMRs) could be built in the north-east of England but not by Rolls-Royce Holdings PLC (LSE:RR.), Britain’s leading candidate to develop the technology.

In the same week that shockwaves were felt around the industry as an expected first SMR project in the US was cancelled due to a lack of interest from local utilities, US-based Westinghouse Electric was today reported to be close to agreeing a deal to build four SMRs near Hartlepool.

Looking to bring the mini nuclear power plants to the banks of the river Tees is Tees Valley, Ben (Lord) Houchen, according to a Telegraph report, is "poised" to sign an agreement as he looks to develop the brownfield land of the former Teesside steel industry.

Through their modularised designs, which will allow facilities to be largely assembled in factories rather than on-site, SMRs aim to offer a cheaper and quicker way of providing carbon-free energy.

Rolls-Royce is seen as one of the frontrunners to develop the first UK SMR projects, with its £1.8 billion-per-site design using tech similar to that in nuclear submarines to power up to a million homes.

It was shortlisted in the government-run SMR competition in October, along with Westinghouse’s UK arm, EDF, GE-Hitachi, Holtec Britain, and NuScale Power, the operator with the cancelled US project earlier this week.

But of those names, only Rolls was thought to be currently undergoing assessment from the Office for Nuclear Regulation (ONR) and Environment Agency for the first order, which it insisted put it almost two years ahead of its competitors in bringing an SMR on-stream and receiving funding from the UK government to build the reactors, though others have also applied for regulatory approval.

Rolls chief executive Tufan Erginbilgic has previously said the winner of the UK’s ongoing government-run SMR competition will need “tangible commitments in terms of projects - multiple projects”.

Earlier this week at its much-trumpeted investor event, Rolls said is planning to work with a “broad set of partners” to develop SMRs.

The government is close to publishing its long-awaited nuclear roadmap, which will set out plans to build a new generation of small and large nuclear reactors around Britain.

Westinghouse was bought last year by secretive Canadian infrastructure investor Brookfield.

UK's first small nuclear reactor deal 'poised' for signing but not with Rolls-Royce | LSE:RR. (