Texas could become a global leader in advanced nuclear development and deployment, but getting there will require a new approach to regulating and siting reactors, as well as financial support from the state, according to a report published Monday by the Public Utility Commission of Texas.
“Texas has the industrial and developmental needs — from oil & gas production to data centers and a burgeoning Artificial Intelligence sector — with demand growth projected at 8% a year for the next decade,” PUCT Commissioner Jimmy Glotfelty wrote in a letter to Gov. Greg Abbott, R. “Advanced nuclear is a viable solution to lead the way.”
The report includes seven recommendations for state lawmakers, including establishment of a nuclear authority and permitting officer within an existing state agency and a Texas Nuclear Energy Fund to provide development incentives similar to the state’s support for natural gas-fired generation.
Abbott in 2023 directed the PUCT to establish a working group to study advanced nuclear reactors, or ANRs, and tapped Glotfelty to lead the initiative. The state has been seeking to develop more generating resources in order to meet rapidly growing electricity demand.
The Electric Reliability Council of Texas projects that by 2030 summer peak demand will nearly double the current all-time record of 85 GW set on Aug. 10, 2023, according to the report.
However, “despite the growing need for reliable and firm energy capacity, there are still significant barriers to unlocking private capital,” the report said. “The lynchpin of a flourishing ANR industry is an investor-friendly environment, one in which developers can accurately assess an ANR project’s risk and plan on a specific return prior to deploying capital.”
“Regulatory, construction, and manufacturing hurdles must be clear” in order to bridge initial development to bankable commercial products, according to the report.
There are already three ANR development initiatives in the Lone Star State, the PUCT said:
- Natura Resources and Abilene Christian University are building a molten salt advanced nuclear research reactor;
- Dow Chemical and X-Energy are working with the Advanced Reactor Demonstration Program to build a series of XE-100 advanced reactors at a Dow petrochemical plant in Seadrift, Texas; and,
- Shepherd Power plans to own and operate microreactors supplying clean heat and power to support the oil and gas industry.
But advancing projects to commercial viability and utilizing advanced nuclear to meet growing electricity demand will require a new regulatory approach, the report said.
The report recommends the legislature create the Texas Advanced Nuclear Energy Authority, with the ability administer funds that lawmakers appropriate to support advanced nuclear capital projects, supply chain development, and other initiatives.
A nuclear permitting officer, working within the state’s new nuclear authority, “would facilitate smooth navigation of bureaucratic procedures and provide tailored assistance to companies seeking to build advanced nuclear reactor operations in the state,” according to the report. The role could also serve as a point of contact to share information of Texas' economic incentive programs, it suggested.
Because capital costs associated with advanced nuclear energy “can be prohibitive,” the report recommends the Texas legislature create a funding pathway, modeled after the Texas Energy Fund, specifically to bring advanced nuclear reactor projects online by 2035.
The model has shown success with fossil fuel generation. Texas voters last year approved the TEF, and the state’s legislature appropriated $5 billion to provide 3% state-backed loans to developers of new gas-fired capacity. In August, the PUCT said it received 72 applications representing more than 38 GW seeking TEF loans.
Nuclear stakeholders welcomed the report, and said it helped illuminate a path forward for the industry.
“One thing Governor Abbott has fostered in Texas is a regulatory environment that supports the building of large necessary infrastructure,” Reed Clay, president of the Texas Nuclear Alliance, said in a statement. The group includes NuScale Power, Dow, Google, Paragon Energy Solutions and others.
“We believe a streamlined, efficient nuclear regulatory framework is key to Texas becoming the Nuclear Capital of the world,” Clay said.
Other recommendations in the report include the creation of:
- A workforce development program to improve coordination between community colleges, universities and industry;
- The Texas Advanced Manufacturing Institute to nurture a nuclear ecosystem in Texas, bringing together advanced nuclear developers, equipment manufacturers and service providers;
- A statewide public outreach program to communicate the benefits of advanced nuclear power and reactor development; and,
- A direct grant cost-sharing program to incentivize early development and siting of reactors, and support supply chain and manufacturing capacity readiness. The program could be managed by the state’s new nuclear authority.
“This report is just the beginning,” Glotfelty said in a statement. “Now, Texas and our leaders are equipped with the information they need to take swift action and ensure advanced nuclear power delivers safe, reliable, and affordable energy for generations of Texans to come.”
