- Texas aims to lead in advanced nuclear energy, creating initiatives and a $2 billion fund for Small Modular Reactor (SMR) development and deployment.
- Rising energy needs attract SMR investment to Texas, leveraging its infrastructure and policies.
Governor Greg Abbott laid out his nuclear ambitions for Texas in 2023 when he launched the Texas Advanced Nuclear Reactor Working Group to “position Texas as the national leader on advanced nuclear energy.” The group brought together advanced nuclear investors, manufacturing companies, the state grid operator ERCOT, local policymakers, and academic institutions.
Their collaboration produced a blueprint unveiled last November, which proposed the creation of the Texas Advanced Nuclear Energy Authority, a non-regulatory state entity tasked with coordinating the state’s strategic vision for advanced nuclear energy and the Texas Nuclear Energy Fund, which could allocate $2 billion to support the development of small modular reactors (SMRs).
X-energy CEO Clay Sell said the working group enabled SMR developers to forge stronger relationships with stakeholders in government, manufacturing, utilities, and education, which will accelerate deployment. “X-energy believes that building and deploying advanced nuclear facilities in Texas will help push the industry towards scale, reducing costs and timelines for future deployments by building a robust supply chain and a supportive policy framework for new nuclear technologies.”
SMR developers began focusing on Texas in 2022 when they helped establish the Texas Nuclear Alliance industry association to transform the Lone Star State into the “nuclear capital of the world.” Several alliance members, including X-energy, TerraPower and Last Energy, have announced recent investments in Texas.
In March, X-energy, in partnership with chemical manufacturer Dow, announced that it had filed a construction permit application with the Nuclear Regulatory Commission to build a nuclear project in Seadrift, Texas.
X-energy’s Xe-100 advanced SMR will supply power and steam to a Dow site that produces over 4 billion pounds of chemicals and plastics annually for various applications, including food packaging. This project could become the first co-location of a grid-scale advanced nuclear reactor at an industrial site in North America.
“Seadrift’s power and steam demand aligns well with the expected generation from an X-energy build, allowing Dow’s reliability requirements to be met while also leaving a portion of the off-take available to the market,” said Edward Stones, Business Vice President, Energy and Climate, Dow.
“With additional growth at the site and existing energy and steam assets nearing end-of-life, Dow saw the opportunity to replace them with safe, reliable, lower carbon emissions technology,” Stones told Reuters Events.
In January, TerraPower, an advanced nuclear power company backed by Bill Gates and Sabey Data Centres, a U.S. data centre operator, announced a partnership to co-locate SMRs and data centres in the Rocky Mountain states and Texas.
“Texas is a key market for future Natrium plant deployments, and TerraPower is actively exploring multiple siting opportunities across the state,” said Jeff Miller, VP of Business Development at TerraPower.
Texas offers several energy sites with potential synergies and existing grid connections for SMR developers. These include two operational nuclear power plant sites, Comanche Peak and South Texas Project, each with two AP-1000 reactors and retired coal plants. Between 2018 and 2020, Texas closed six coal-burning power plants, totalling 6.4 GW.
Existing nuclear sites provide significant advantages for SMR siting. The U.S. Department of Energy’s Advanced Nuclear Commercial Liftoff report stated last year that there may be space for 60 to 95 GW of new nuclear capacity at existing sites nationwide. According to the report, generating costs at multi-unit nuclear plants are 30% lower per MWh than at single-unit plants.
“I’m certain that developers are examining existing sites and that utilities operating these sites are assessing their capabilities,” Elina Teplinsky, Partner at Pillsbury Winthrop Shaw Pittman LLP, told Reuters Events.
Kairos Power, Natura Resources, Terrestrial Energy and Aalo Atomics have also agreed to develop SMRs at the Texas A&M University System’s RELLIS technology campus. Kairos Power and Natura Resources have already begun deploying test reactors at the site.
“All the universities in Texas have state-of-the-art facilities, strong engineering programmes, ample space for demonstrations, and the right departments and students to support these projects,” Teplinsky said. States such as New York, Tennessee, Utah, Wyoming, Michigan and Virginia have recently introduced policies and strategies to attract SMR investment. Still, Texas holds an early lead due to its size.
Texas consumes more energy as a net energy exporter than any other U.S. state. This is mainly due to its industrial sector, which accounts for more than half of its energy use, and its large population.
ERCOT projects that electricity demand will nearly double by 2030, driven by data centres seeking 24/7 low-carbon power. This demand has positioned Texas as a hotspot for SMR investors. North Central Texas’s Dallas–Fort Worth metroplex is home to over 150 data centres from companies such as Google, Facebook, and Verizon, making it the second-largest U.S. data centre hub after Virginia.
In February, Last Energy announced plans to build 30 microreactors in Haskell County, northwest Texas, to serve data centre clients nationwide. The company will deploy the 20-MW microreactors in phases, supplying power to data centres and the ERCOT grid.
“Last Energy chose to develop in Texas in response to the surge in demand from Texas-based data centre developers over the past year,” a spokesperson told Reuters.
ERCOT also expects population growth, investment from energy-intensive industries such as petrochemical plants and refineries, and the need for more heating and cooling during extreme weather to drive further demand.
Reed Clay, President of the Texas Nuclear Alliance, added, “Texas is the fastest-growing state in the country in population and industry. More people, more jobs and more innovation will demand more power.”