Federal incentives to encourage private sector investment in the deployment of small modular reactors could generate a higher payoff than the government effort over the past decade to promote the use of renewable energy, according to a new Department of Energy report. Examination of Federal Financial Assistance in the Renewable Energy Market, co-authored by Kutak Rock and Scully Capital, estimates that $10 billion in incentives would be needed to deploy 6 gigawatts of small modular reactor capacity by 2035. The cost of such an investment on a per kilowatt hour basis would be only one-third as expensive as the federal government’s initiative to stimulate the development of solar plants and wind farms. From 2005-2015 the government provided $51.2 billion in mandates, tax incentives, loans and research grants to stimulate solar and wind production. About 90 percent of that investment came in the form of subsidies, which included investment and production tax credits. As a result, solar capacity grew by nearly 78,000 megawatts and wind capacity added more than 446,000 megawatts over that period.
Photo by Idaho National Laboratory