In the early 2020s, there was great enthusiasm around the development of the small modular reactor (SMR), which was expected to support a nuclear renaissance. However, after supply chain disruptions, technical difficulties, and other challenges, it is unclear whether SMR development is progressing as expected. Nevertheless, some companies continue to invest heavily in the technology, hoping it will help drive innovation and expansion in the nuclear power sector.
SMRs are advanced nuclear reactors with a power capacity of up to 300 MW(e) per unit, equivalent to around one-third of the generating capacity of a conventional nuclear reactor. SMRs are much smaller than conventional reactors and are modular, making them easier to assemble in factories and transport to the site. Thanks to their smaller size, SMRs can be installed on sites not suitable for larger reactors. SMRs are also much cheaper and faster to build than traditional nuclear reactors and can be constructed incrementally to meet a site’s growing energy demand.
Several countries are pursuing SMR development, including the United States, China, and Russia, as well as Canada, France, Japan, South Korea, and the United Kingdom. Russia and China are currently the only two countries with grid-connected, operational SMRs. Russia’s floating Akademik Lomonosov plant produces electricity and heat, while China’s HTR-PM, a high-temperature gas-cooled pebble-bed reactor, generates just electricity. Japan also has an operational high-temperature engineering test reactor, but this is categorised as a research and test reactor rather than a commercial reactor.
In the United States, the government has supported private SMR innovation through favourable federal policies and regulations. TerraPower, X-energy, and NuScale are among the leading companies advancing SMR development. In May 2025, President Trump issued four executive orders aimed at revitalising U.S. nuclear power. While Trump has generally pushed for more fossil fuel expansion and restricted renewable energy development, he has been vocal in his support for nuclear power since coming into office.
Trump aims to support the deployment of new nuclear reactor technologies and expand American nuclear energy capacity from around 100 GW today to 400 GW by 2050. In December 2025, the Department of Energy selected the Tennessee Valley Authority and Holtec Government Services to support early deployments of advanced light-water SMRs in the United States, with the teams expected to receive a combined total of $800 million in federal funding for initial projects in Tennessee and Michigan.
The United States is also collaborating with other countries to advance SMR technology. In March 2026, the U.S. Department of Commerce announced a $40 billion energy partnership with Japan to deploy GE Vernova Hitachi (GVH) BWRX-300 SMRs in Tennessee and Alabama as part of the U.S.-Japan Strategic Investment initiative.
Meanwhile, in the U.K., in 2025, the government selected aerospace company Rolls-Royce as the preferred developer of SMR technology, with over $800 million in financing from Britain’s national wealth fund. Rolls-Royce will develop its first SMR project at Wylfa on the island of Anglesey, where plans for a conventional nuclear plant were scrapped in 2020. In June, Rolls-Royce SMR was chosen by the Swedish development company Videberg Kraft to build SMRs in Sweden, marking a major multibillion-pound export deal between the U.K. and Sweden.
While there has been widespread government support for SMR development, many hurdles have stood in the way of commercial deployment. Several companies have already presented compelling prototypes and positive laboratory results, but translating this into repeatable commercial deployment is a complex task. Over 120 distinct SMR designs have been recorded globally, compared to 83 in 2022. However, many have not achieved licensing, and most are still on the long road to commercial deployment.
In Europe, one of the main hurdles is the fragmented national regulators, differing political positions among member states, and the limited ability to deploy large-scale public capital rapidly. Meanwhile, in the United States, the deployment-oriented approach, which focuses on accelerating advanced nuclear licensing, has spurred private SMR development, but has not prioritised long-term coordination and industrial harmonisation.
A funding gap persists for SMR development in several regions of the world, although greater federal and private financing has helped the U.S. advance SMR development, with the first U.S. SMR commercial deployment expected in 2028.
Meanwhile, many advanced SMRs are powered using HALEU fuel, which has between 5 and 20 per cent enriched uranium, and is produced almost exclusively in Russia. The United States and some other countries are gradually producing their own HALEU supplies, although strict sanctions on Russian energy have delayed SMR deployment in several places.
While SMRs are likely to play a major role in the nuclear industry’s future, severe delays and funding gaps have slowed deployment. The United States is currently playing catch-up with China and Russia, while Europe and other regions of the world could still be several years behind in commercial SMR deployment
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