The U.S. Nuclear Regulatory Commission accepted TerraPower’s construction permit application for a commercial non-light-water reactor in Kemmerer, Wyoming, the first such filing in more than 40 years. That milestone, paired with federal financing moves supporting nuclear energy and a new NRC licensing framework slated to take effect on April 27, 2026, signals that small modular reactors are moving from concept to early-stage commercialization. Whether these compact plants can deliver on their promise depends on clearing regulatory, financial, and social hurdles that have already claimed at least one high-profile project.
Why Smaller Reactors Carry Bigger Advantages
Conventional nuclear plants require massive site preparation, custom engineering, and decade-long construction timelines that drive costs into the tens of billions. Small modular reactors flip that model. They use factory-built components that can be assembled on-site with less civil work, cutting both lead times and upfront capital risk. The U.S. Department of Energy has highlighted that advanced designs can reduce site work, rely on modular fabrication, incorporate passive safety systems, and coordinate with renewables on the same grid, allowing operators to balance variable wind and solar output with steady nuclear generation.
Because each unit is smaller, utilities can add capacity incrementally rather than committing to a single multi-gigawatt plant. That flexibility matters for rural grids and industrial sites where demand does not justify a full-scale reactor but where coal or gas plants are retiring. SMRs, like their larger counterparts, can produce low-carbon electricity, and analysts at Stanford University’s Understand Energy program have noted that these reactors could play an increasingly important role in a low-carbon future. Educational efforts, such as a Penn State Extension overview that frames SMRs as a tool for expanding clean energy access, emphasize that one central objective is to support decarbonization while maintaining reliability, but they also stress the need for public engagement around safety and waste.
Two Flagship Projects Test the Model
The federal government is backing its rhetoric with money and regulatory action through the Advanced Reactor Demonstration Program. The program’s two lead awardees illustrate different paths. TerraPower’s Natrium reactor, a sodium-cooled fast reactor with 345 MWe-net capacity, is sited near a retiring coal plant in Wyoming, aiming to replace retiring fossil generation with low-carbon electricity and adding thermal storage to shift output to peak hours. X-energy’s Xe-100, a high-temperature gas-cooled design, plans four units totaling 320 MWe-net at Dow’s Seadrift, Texas facility, where industrial process heat can displace natural gas alongside electricity production, testing whether SMRs can serve both grid and industrial customers.
The Natrium application’s acceptance by the NRC was the first non-light-water docket for a commercial reactor in more than 40 years, underscoring how long the U.S. fleet has depended on a single technology. Meanwhile, the NRC approved NuScale Power’s uprated SMR design at 77 MWe per unit, giving the company a certified product even as its first deployment stumbled. In parallel, the Department of Energy has demonstrated willingness to support existing plants through financing tools, such as a recent decision to approve an initial loan disbursement that will help restart the Palisades facility, signaling that federal backing spans both advanced reactors and legacy assets as policymakers try to keep nuclear in the decarbonized mix.
NuScale’s Cancellation Exposes Real Risks
Optimism about SMRs has to contend with NuScale’s Carbon Free Power Project, which was terminated after costs escalated beyond what its utility consortium could absorb. NuScale and the Utah Associated Municipal Power Systems notified the NRC in November 2023, and the commission suspended its review effective November 13, 2023. The project had been the closest any SMR came to actual U.S. deployment, and its collapse raised hard questions about whether modular construction savings can actually offset the first-of-a-kind engineering and supply chain costs that plague every new reactor type, especially when inflation and interest rates increase financing burdens.
NuScale’s annual filing with the SEC for the year ended December 31, 2024, disclosed ongoing commercialization risks, including dependence on future customer agreements and regulatory milestones. An energy justice study published in a peer-reviewed journal has also raised concerns that SMR siting decisions could disproportionately affect communities of color and low-income populations, a dimension largely absent from federal promotional materials that focus on climate and reliability. These financial and social risks do not invalidate the technology, but they complicate the narrative that factory-built reactors will simply slot into the grid without friction, underscoring the need for transparent cost data, community benefits agreements, and clear decommissioning plans before investors, regulators, and host communities commit at scale.
A New Regulatory Framework Arrives in 2026
One structural barrier to advanced reactors has been a licensing system designed around large light-water plants built in the 1970s and 1980s. The NRC’s Part 53 rulemaking aims to fix that. The commission published a proposed rule on October 31, 2024, closed public comments on February 28, 2025, and estimates the final framework will be published by March 27, 2026, with an effective date of April 27, 2026. Part 53 is designed as a risk-informed, technology-inclusive framework, meaning it would evaluate reactors based on their actual safety profile rather than forcing every design through requirements tailored to gigawatt-scale light-water units, and it is intended to reduce regulatory uncertainty for developers that do not fit legacy categories.
In practice, that shift could shorten licensing timelines for designs that demonstrate strong inherent or passive safety, while still preserving strict oversight of radiological risks. The NRC is also updating its guidance for very small systems, with a dedicated page outlining microreactor activities that cover siting, security, and emergency planning for reactors that might serve remote communities, military bases, or industrial campuses. Together, these regulatory reforms are meant to create a clearer pathway from pilot projects to commercial fleets, but they will only accelerate deployment if developers can pair streamlined licensing with credible cost control and community trust.
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*This article was researched with the help of AI, with human editors creating the final content.
