Rolls-Royce is poised to land ‘billions of pounds’ worth of orders for mini nuclear power stations from Eastern European nations, the boss of a major investor has said.
A consortium led by the engineering giant has secured £210million of funding from private investors for its small modular reactors (SMRs) programme in the UK.
That is set to unlock the same amount of funding from the Government, allowing Rolls-Royce to kick-start the project. An announcement is expected imminently and green investment fund IP3 said an endorsement by the Government should pave the way for the technology to be exported to other countries.
IP3 has been sounding out pension funds and institutional investors about pouring cash into a multi-billion pound fund to invest in small nuclear infrastructure.
It is also advising energy providers and governments on developing nuclear power projects.
IP3 chief executive Mike Hewitt, a retired US Navy rear admiral, told The Mail on Sunday that eastern European nations – including Poland, the Czech Republic, Latvia, Hungary, Estonia and Bulgaria – are developing ‘aggressive plans’ for nuclear.
He said Rolls-Royce’s project was ‘among the frontrunners’, adding: ‘Rolls-Royce is uniquely positioned as a British brand-named company which is used to a factory approach in stamping out aircraft engines. If the UK commits to allow the build of the first three or four reactors, you can move into production, then it is in prime position to be the reactor of choice for other countries.’
IP3 is advising large Polish energy supplier ZE PAK on the development of a plan for nuclear plants.
Rolls-Royce said it was in discussions with interested parties over ‘export opportunities around the world, including in Europe’.
Its investment consortium is aiming to build a fleet of 16 factory-built reactors by 2035 to complement larger power plants. IP3 hopes the consortium can land hundreds of millions of pounds more in taxpayer funds to move the project through the design and regulatory assessment phase and into production.
The gas bills crisis has sharpened the focus on investment in nuclear to build up the UK’s energy supplies and complement renewable energy sources as Britain tries to hit net zero carbon by 2050. Britain is already facing a hole in its nuclear supplies with six large plants due to be taken offline by 2030.
Nuclear industry sources warned that Rolls’ programme is in its infancy compared with technology being developed in North and South America and China. Several UK sites have been mooted for the SMRs, including Copeland in Cumbria.
Hewitt said: ‘We are extremely confident we can come in and bring in outside capital to invest in these projects if the Government puts in the requisite equity to start the project and reduce the risk.
‘The Prime Minister has a plan to boost Britain’s green energy and nuclear SMRs are a significant part of that. There are a lot of pension funds, institutional investors and sovereign wealth funds keen to back nuclear hybrid systems.’
Government backing for the SMR programme would be a further boost for Rolls-Royce, which has finally sold its Spanish business, ITP Aero, for £1.5billion as it attempts to slim down. It also clinched a £1.9billion deal to supply parts for the US Air Force’s fleet of B-52 bombers into the 2050s.
Shares have jumped 35 per cent to £1.42 in the past two weeks, spurred in part by optimism that long-haul travel is returning – a key income stream for Rolls-Royce.
Meanwhile, new chairman Anita Frew took charge last week and is under pressure from US activist investor Causeway Capital to refresh its board.