Small modular reactors: France faces a major challenge

A Market in the Making, with dual-speed technologies 

The nuclear sector is currently experiencing unprecedented excitement around Small Modular Reactors (SMR) and Advanced Modular Reactors (AMR). While these terms are often used interchangeably in public debate, they actually refer to distinct technological realities. 

SMRs are based on Generation III reactors, proven technologies in a miniaturised form, whereas AMRs explore Generation IV concepts such as molten salts, liquid lead or fast neutron reactors. These innovations, studied as far back as the 1970s and 1980s, have now become feasible thanks to advances in metallurgy and materials chemistry. 

Two main approaches structure this emerging market. On one side stand the traditional industrial giants such as Rolls-Royce, Westinghouse, Hitachi, Rosatom, and EDF through its Nuward project, leveraging their mastery of the nuclear cycle and their ability to adapt existing solutions. On the other, around one hundred start-ups including Newcleo, Jimmy and Naarea are seeking to disrupt the sector with bold, unconventional designs. 

This duality raises a fundamental question: who will reach the regulatory finish line first, the experienced incumbents accustomed to strict safety regimes, or the agile newcomers driven by innovation? 

Major Challenges to Realising the Ambition 

Despite these promising prospects, several structural barriers remain. The first is Europe’s regulatory mosaic. Each national safety authority enforces its own rules, making the much-vaunted SMR economies of scale unrealistic unless requirements are harmonised. 

Nuward has initiated talks with six European regulators to align certification processes, a first step towards gradual convergence. Without regulatory alignment, achieving production volumes of 50 to 200 units, the threshold for economic viability, will remain impossible. 

Financing is the second major bottleneck. Before benefiting from economies of scale, a first reactor must be certified. Developing and certifying this First of a Kind (FOAK) unit costs 5 to 8 billion euros, far beyond the reach of even the best-funded start-ups. Yet this initial step is essential to unlock future serial production and cost reduction. 

Europe has invested around 12 billion euros over the decade, but this funding is spread across some thirty projects. In contrast, China and Russia, with more centralised models, concentrate resources on a handful of national champions. Europe’s fragmented approach struggles to produce credible leaders. The European SMR Alliance is now calling for massive political-level support to bring one or two viable concepts to fruition. 

Finally, operational questions remain unresolved. Who will operate these private nuclear installations? In France, only EDF currently holds a nuclear operating licence, which entails obligations for long-term safety, decommissioning and waste management. It is hard to imagine another industrial player assuming such responsibilities without state backing. The business model is yet to be invented. 

A Decisive Decade for Modular Nuclear 

The SMR and AMR market is entering an inevitable consolidation phase. The gap between spectacular announcements and industrial reality remains vast. Only a few projects have reached contractual maturity, in Canada with Hitachi, and in China and Russia, while American partnerships with AI giants remain at the memorandum stage. 

The coming years will determine which players survive the test of financing and certification. 

For France, the issue goes well beyond power generation. It is about preserving industrial excellence, decarbonising heavy industry, and maintaining technological sovereignty in a strategic sector. 

SMRs and AMRs will not replace large reactors in the short term, but they can occupy high-value niches: industrial heat, gradual fleet renewal, or electrification of isolated areas. 

That will only happen if European policymakers finally choose between spreading subsidies thinly and focusing resources on a handful of credible champions. The time for lofty ambitions must now give way to decisive structural choices.