Small Modular Reactors: Britain's £2.5 Billion Gamble on Nuclear Revival

In June 2025, the UK government selected Rolls-Royce SMR as its preferred partner to build Britain’s first small modular reactors. In November, it announced Wylfa in North Wales as the site for three initial reactors.

The government is committing over £2.5 billion to this programme. Energy Secretary Ed Miliband called it the start of “a golden age of nuclear.” Chancellor Rachel Reeves said it puts the UK “at the lead in the technologies of tomorrow.”

The stakes are high. Britain imports 40% of its energy at a cost of £24.3 billion annually. Nuclear output has collapsed from 100 TWh to 41 TWh over two decades. If SMRs work as promised, they could reverse this decline, providing reliable baseload power with a 258× smaller land footprint than wind.

If they don’t, Britain will have repeated the mistakes of Hinkley Point C on a smaller scale, multiple times over.

What Is an SMR?

Small modular reactors are nuclear power plants designed to be smaller, simpler, and faster to build than conventional reactors. The “modular” part is key: instead of constructing a bespoke power station on site, components are manufactured in factories and assembled like large industrial equipment.

Rolls-Royce SMR specifications:

Power output: 470 MWe (megawatts electrical)
Thermal capacity: 1,358 MWt
Technology: Pressurised water reactor (PWR), the same proven technology used in most of the world’s nuclear fleet
Land footprint: Approximately 4 hectares (10 acres) total site, with a 1.5-acre reactor building footprint
Design life: 60 years

For context, Hinkley Point C’s two reactors will produce 3.26 GW combined. You would need seven Rolls-Royce SMRs to match that output, but each SMR could be built faster and at a different location.

The theoretical advantages are compelling:

Factory manufacturing reduces on-site construction complexity
Standardised design means learning from each build
Smaller units allow deployment at more sites
Shorter construction times reduce financing costs
Modular expansion lets capacity grow with demand

The question is whether these advantages survive contact with reality.

The UK’s SMR Programme: Timeline and Funding

The path to the November 2025 announcement has been long and uncertain.

Key milestones:

Date	Event
November 2021	Government provides £210 million to Rolls-Royce SMR for design development
July 2023	Great British Nuclear launches SMR competition with six vendors
January 2024	Civil Nuclear Roadmap published, targeting 24 GW nuclear capacity by 2050
March 2024	Great British Nuclear acquires Wylfa and Oldbury sites from Hitachi for £160 million
April 2022	Rolls-Royce SMR enters Generic Design Assessment with ONR
July 2024	Rolls-Royce SMR progresses to Step 3 (final phase) of GDA
June 2025	Rolls-Royce selected as preferred technology partner
November 2025	Wylfa announced as first SMR site

Funding committed:

£210 million: Initial government grant for design development (2021)
£195 million: Private investment from Rolls-Royce Group, BNF Resources UK Limited, and Exelon Generation Limited
£160 million: Site acquisition (Wylfa and Oldbury)
£2.5 billion+: Programme commitment in current Spending Review period

Projected timeline:

August 2026: GDA completion expected
2026: Site activity begins at Wylfa
Mid-2030s: First power to grid
2030s: All three initial SMRs operational

This timeline is ambitious. The Generic Design Assessment alone takes 53 months. Site licensing, construction permits, and actual building will take years more. The “mid-2030s” target for first power is a decade away.

The Cost Question

Rolls-Royce’s cost projections have evolved:

Initial estimate: £1.8 billion per 470 MW unit once in full production
First-of-a-kind cost: £2.2 billion per unit
Learning curve target: £1.8 billion by the fifth unit built

To put these numbers in context:

Cost per GW of capacity:

Rolls-Royce SMR (target): £3.8 billion/GW
Hinkley Point C (current estimate): £10.7-14.7 billion/GW (based on £35-48 billion for 3.26 GW)
Offshore wind: £1.5-2.5 billion/GW (but requires backup capacity)

On paper, SMRs look competitive. But these are projections, not proven costs.

The Hinkley Point C warning:

Britain’s only nuclear plant currently under construction provides a cautionary tale. When approved in 2016, Hinkley Point C was expected to cost £18 billion and begin operations in 2025.

Current estimates: £35-48 billion, with first power between 2029 and 2031.

That is a 94-167% cost overrun and a 4-6 year delay, and it isn’t finished yet.

EDF’s site managing director cited “civil construction slower than we hoped and faced inflation, labour and material shortages, on top of Covid and Brexit disruption”.

SMR proponents argue their technology avoids these problems through factory manufacturing and standardised design. But no Rolls-Royce SMR has been built anywhere. The claimed efficiencies are theoretical.

International Context: No Commercial SMR Fleet Exists

The UK is betting on technology that has not been commercially deployed anywhere in the world.

Global SMR status (November 2025):

Country	Project	Status
USA	NuScale VOYGR (Idaho)	Cancelled November 2023 - costs rose from $3.6bn to $9.3bn
Russia	Akademik Lomonosov	Operational (floating, 70 MW total) - significant delays and cost overruns
China	HTR-PM	Operational (210 MW) - 7+ years late, costs undisclosed
Canada	Multiple projects	In development, no construction started
Romania	NuScale project	FEED stage (planning only)

The only operational SMRs are in Russia and China, both with government backing that obscures true costs. Both projects experienced significant delays.

The NuScale cancellation is particularly relevant. NuScale was the first SMR design to receive US Nuclear Regulatory Commission certification. Its Utah project was the most advanced Western SMR development. It was cancelled because costs more than doubled from original estimates, from $3.6 billion to $9.3 billion.

NuScale was also a finalist in the UK’s SMR competition before being eliminated in September 2024.

This does not mean Rolls-Royce SMR will fail. But it means there is no proven cost or timeline data for commercial SMR deployment anywhere. Every projection is theoretical.

Why Wylfa?

The choice of Wylfa in Anglesey, North Wales, is significant.

Site history:

Wylfa housed two Magnox reactors from 1971 until 2015
Wylfa Newydd, a proposed large reactor project, was abandoned by Hitachi in 2020 after costs escalated
Great British Nuclear acquired the site in March 2024

Advantages:

Existing grid connections
Nuclear-experienced local workforce
Community familiar with nuclear operations
Coastal location for water cooling
Previous environmental assessments completed

Capacity potential: The government says Wylfa could eventually host up to eight SMRs, producing approximately 3.76 GW, more than Hinkley Point C.

The Oldbury site in Gloucestershire remains available for future expansion, potentially for “privately-led projects.”

Jobs and Supply Chain

The government projects significant employment benefits:

3,000 skilled jobs at peak construction
70% supply chain targeted to be British-built
40,000 jobs across the supply chain once a fleet is operational (Rolls-Royce projection)

Current UK nuclear employment:

87,000 direct jobs in the civil nuclear supply chain
256,000 total jobs supported by the sector
Average GVA per employee: £92,000, nearly twice the UK average

Supply chain challenges:

The UK’s nuclear supply chain has atrophied during two decades without new construction. Industry reports note significant skills gaps, particularly in:

Nuclear welding and fabrication
Reactor component manufacturing
Project management for nuclear-grade construction

The government’s Nuclear Skills Taskforce is attempting to address this, but rebuilding expertise takes years. Meanwhile, Hinkley Point C has relied heavily on imported expertise and components.

SMR proponents argue factory manufacturing could be done domestically, but the factories don’t exist yet. Rolls-Royce SMR partnered with the University of Sheffield in 2024 to create manufacturing and testing facilities, but these are years from production scale.

The Regulatory Hurdle

Before any SMR can be built, it must complete the Generic Design Assessment (GDA), a rigorous safety review by the Office for Nuclear Regulation (ONR) and Environment Agency.

Rolls-Royce SMR GDA timeline:

Step 1 (April 2022 - March 2023): Initial assessment, 12 months
Step 2 (April 2023 - July 2024): Fundamental assessment, 16 months
Step 3 (July 2024 - August 2026): Detailed assessment, ~25 months expected

Total duration: 53 months (4.4 years)

No other SMR design is as far advanced in UK regulatory approval. Holtec, GE-Hitachi, and Westinghouse (the other competition finalists) would need to start their own GDA processes from scratch if they wished to build in the UK.

This is both a regulatory advantage for Rolls-Royce and a vulnerability for the UK programme. If Rolls-Royce encounters problems, there is no backup option with comparable regulatory progress.

The Case For SMRs

Despite uncertainties, the case for SMRs is substantial:

1. Energy security

Britain’s 40% energy import dependency leaves us vulnerable to price shocks and geopolitical disruption. Nuclear provides domestic baseload power that doesn’t depend on imported gas or Russian uranium (UK uses enriched uranium from domestic and allied sources).

2. Grid stability

Unlike wind and solar, nuclear provides dispatchable power 24/7. As Britain adds more intermittent renewables, stable baseload becomes more valuable. SMRs could complement renewables by filling gaps when wind doesn’t blow.

3. Land efficiency

A single SMR produces 470 MW from a 10-acre site. Equivalent wind capacity would require approximately 45,000 acres, with lower capacity factor. For a crowded island, land efficiency matters.

4. Decarbonisation

Nuclear produces approximately 5-12 gCO2/kWh lifecycle emissions, comparable to wind and lower than solar (when manufacturing is included). It generates zero emissions during operation.

5. Industrial strategy

A successful SMR programme could establish UK leadership in a potentially significant export market. Countries seeking to decarbonise will need nuclear options, and British-designed SMRs could compete globally.

The Case Against (Or at Least for Caution)

The risks are equally substantial:

1. No commercial track record

Not a single commercial SMR fleet operates anywhere in the world. The UK is betting billions on unproven technology. Every cost and timeline projection is theoretical.

2. Nuclear’s troubled history

British nuclear construction has a poor record. The AGR programme in the 1970s-80s was, in the words of the Central Electricity Generating Board’s former head, “a catastrophe we must not repeat”. Dungeness B was 12 years late. Most AGRs had huge cost overruns.

Hinkley Point C is following the same pattern. There is no evidence that lessons have been learned.

3. Cost escalation risk

NuScale’s cancellation after costs doubled is a warning. First-of-a-kind nuclear projects routinely exceed budgets. The £2.2 billion per unit estimate could easily become £4 billion.

4. Timeline risk

“Mid-2030s” for first power is already a decade away. If GDA takes longer than expected, or construction hits problems, the timeline could slip further. Britain’s energy crisis is now, not in 2035.

5. Opportunity cost

£2.5 billion+ invested in SMRs is £2.5 billion not invested in alternatives: offshore wind, grid storage, demand flexibility, or interconnectors. If SMRs fail or are significantly delayed, that money is lost.

What Success Would Look Like

For SMRs to justify the investment, they need to achieve:

GDA completion by August 2026 as scheduled
First power by mid-2030s as targeted
Costs at or below £2.2 billion for the first unit
Learning curve realised: subsequent units built faster and cheaper
Export orders: demonstrating commercial viability to international buyers

The government should publish transparent progress reports against these metrics. Taxpayers are entitled to know whether their investment is delivering.

Conclusion: A Calculated Risk

Britain’s SMR programme is neither obviously right nor obviously wrong. It is a calculated risk on technology that could help solve our energy security crisis, or could repeat the expensive failures of past nuclear projects.

The arguments for attempting this are strong:

Nuclear is the only proven low-carbon baseload technology
Britain’s energy import dependency is a strategic vulnerability
SMRs could complement renewables in a way large reactors cannot
The UK has site, skills, and regulatory infrastructure to attempt this

The arguments for caution are equally strong:

No commercial SMR exists anywhere
Every cost and timeline estimate is theoretical
British nuclear construction has a troubled history
The money could be spent on proven alternatives

What would be inexcusable is proceeding without transparency. The government has committed £2.5 billion of public money. It should publish quarterly progress reports, cost updates, and honest assessments of problems encountered.

If Rolls-Royce SMR works as promised, this could be the beginning of Britain’s nuclear renaissance. If it doesn’t, we need to know early enough to change course.

The £2.5 billion gamble is underway. Now we wait to see whether the bet pays off.