Purdue officials announced in May that the university was selected to study small nuclear technology and how it can potentially be used to power Indiana in the future. The university previously released a separate study on nuclear energy feasibility at its West Lafayette campus.
In the state-funded report, released by the Indiana Office of Energy Development in November, researchers lauded small modular reactors, or SMRs, as “24/7 dispatchable sources” of carbon-free electricity that have the capacity to meet the state’s growing energy needs. The state office granted Purdue’s team $300,000 to complete the report, according to Indiana’s Transparency Portal.
The study described SMRs as compact nuclear reactors — smaller than traditional nuclear power plants — that can generate up to 500 megawatts of electrical power. The International Atomic Energy Agency cites a lower range, qualifying SMRs as producing under 300 megawatts. Indiana law defines SMR power capacity up to 470 megawatts. The federal government hasn’t settled on a firm definition.
The smaller reactors are designed to offer “scalable energy solutions” with “enhanced safety features” compared to traditional nuclear plants, researchers said.
Currently, no electricity-generating nuclear power plants exist in the state, though there is one major nuclear manufacturing facility located in Mount Vernon, in southwestern Indiana. And of the few projected SMR sites across the United States — and the world — none are currently operational. Major Indiana employer Rolls Royce is developing an SMR.
Much of Indiana’s electricity continues to come from coal, and state lawmakers have been slow to commit to other energy options.
Proponents say the new technology is cheaper and safer than larger nuclear reactors currently in use today. But upfront adoption costs can balloon, and some scientists and environmental groups are concerned that operating expenses are actually much higher, and worry that SMR plants are more dangerous than developers let on.
Even so, Purdue researchers said SMRs are a missed opportunity, and that coal-to-nuclear could help Indiana tap into an energy supply — with the benefit of net-zero carbon emissions.
“SMRs present a viable opportunity for Indiana to transition to a cleaner, resilient, and diversified energy future,” researchers said within the study. “By addressing the outlined challenges — construction costs, supply chain constraints, regulatory compliance, workforce training, and community engagement — Indiana could position itself as a leader in next-generation nuclear technology while creating economic opportunities and ensuring energy security.”
Transitioning from coal
The total amount of electricity generated within Indiana has fallen by 26% over the past two decades, the study noted. Electricity consumption, however, has only decreased by 3% over the same time period.
In 2023, Indiana was the nation’s second-largest coal consumer, after Texas, according to the U.S. Energy Information Administration. Coal fueled 45% of Indiana’s electricity net generation that year, the seventh-highest share of any state.
Purdue researchers noted that Indiana’s energy demands are expected to increase by up to 3% from 2022 to 2030, “a big change compared to the 0.2% annual growth rate over the prior decade.”
Over the long term, SMRs can “mitigate the economic impacts of closing a coal plant,” and open the door to “significantly cheaper” energy, they said.
Researchers pointed, too, to high-paying jobs during both the construction and operation of the facility, an increase of the tax base in the state, and the potential to boost employment throughout Indiana by various supply chain providers, including in nuclear manufacturing.
The study cited just two projects currently in the planning phases for coal-to-nuclear conversion: one sought by Duke Energy in North Carolina, and another planned by TerraPower in Wyoming.
In Mount Vernon, BWX Technologies currently makes the large components of naval nuclear reactors, including the reactor vessels and parts of the steam generator. They also complete the final assembly of the naval nuclear reactors on site before shipping them out to customers.
The Virginia-based company recently conducted a study to explore development of SMR reactor vessels in their Indiana plant. They’ve so far determined that manufacturing those reactor vessels would require construction of an entirely new, $80 million, 120,000-square-foot facility. It’s not clear whether the company will seek out any SMR projects in Indiana.
Separately, officials at Rolls Royce, which has a major manufacturing footprint in Indiana, said they’re exploring construction of an SMR with a capacity of up to 470 megawatts. The British engine maker was the driving force behind a 2023 amendment to state law that increased permitted SMR electric generating capacity from 350 to 470 megawatts.
The Rolls Royce project is also early-stage and could take nearly a decade to come to fruition.
Potential Indiana nuclear sites
A U.S. Department of Energy report published in 2022 found that Indiana has 8 to 10 coal plants suitable for the development of nuclear plants. Only Texas has more, with up to 15 suitable coal power plant sites.
The Purdue study made similar findings, identifying eight coal sites to be suitable for SMR development, including six existing and two recently retired coal plant sites.
An additional eight sites within Indiana passed the researchers’ highest level of technical screening but have one or more factors — like high population density within a four-mile radius of a site, increased potential for earthquakes, location within a 100-year floodplain, nearby hazardous facilities, too few available tax incentives and a lack of water resources — that would make the locations less ideal.
Cost-wise, researchers said that operating a nuclear power plant tends to be “about half” of the operating cost of a gas turbine plant or coal plant of the same size.
A nuclear plant typically creates twice the number of local jobs compared to a similarly sized coal plant, with SMR workers earning 18% more than coal plant workers on average, researchers said. A nuclear power plant’s revenue is also estimated to be about 78% higher than a coal plant “because nuclear plants have a higher capacity factor.”
In total, the economic output of a 300-500 megawatt nuclear power plant was typically two times higher than the economic output of a coal plant of the same size in communities with more than 90,000 people, according to the study.
Among other benefits, using existing coal sites minimizes environmental impacts and allows SMR projects to take advantage of infrastructure that’s already there — such as roads, water, grid interconnection equipment, office buildings, fencing and security, according to the report. Additionally possible is the reuse of coal plant components like heat sinks and electric plant equipment.
Plus, when a coal plant is replaced with nuclear, “it is replacing a baseload power resource directly and can serve the same load as the coal plant served previously,” researchers said.
Possible challenges ahead
Although the study found that small nuclear reactors “show promise,” their deployment is not without challenges.
Construction costs remain high, especially for first-of-a-kind units, which have unique challenges and higher upfront costs, researchers said.
Around 50% of total SMR costs are attributed to reactor plant equipment. Because that equipment is “the most novel,” it can also be challenging to procure.
Still, the study highlighted that subsequent “nth-of-a-kind” units are expected to be “significantly cheaper as experience and efficiencies improve.”
Supply chain stability is another major challenge. High-cost components, like reactor vessels and turbines, require reliable supply networks — which is likely to necessitate multi-state or multi-company orders to be cost-effective.
Careful planning will additionally be required to navigate federal and state regulatory frameworks, researchers emphasized. Currently, each SMR installation must meet “stringent safety and environmental standards.”
SMR deployment will require “comprehensive feasibility studies, regulatory alignment, workforce development, and robust community engagement” for the technology to be “safely and successfully integrated into Indiana’s energy portfolio,” researchers continued.
The study recommended that Indiana leaders create a “broad-based program or incentive” that drives nuclear component manufacturing in-state, where possible, “and when the opportunity is significant and justified.”
Hoosier energy stakeholders should proceed with feasibility studies, build partnerships for SMR development and prioritize stakeholder engagement, researchers advised.
More specific recommendations include the development of educational resources to help explain the benefits of nuclear energy and minimize “perceived” safety and environmental concerns; updates to existing state requirements to help bolster SMR construction, especially at existing or retired coal plants; and taking advantage of existing supply chain resources within the state “to ensure Indiana’s economy benefits from SMR construction anywhere in the nation.”
