Disadvantages of small modular reactors
Small modular reactors attract strong claims on both sides. Supporters describe a faster, cheaper, safer route to nuclear power. Critics call much of that unproven. Anyone considering SMRs for a site should understand the disadvantages first.
For the basics, start with our guide to small modular reactors or micro modular reactors.
1. The economics are unproven
The core promise of SMRs is that factory production of many identical units will offset the loss of economies of scale. That has not yet been shown.
The Union of Concerned Scientists argues that while small reactors should have lower capital costs and construction times than large reactors of similar design, that does not make them more economical per kilowatt-hour. It says factory-learning cost reductions typically would not exceed about 30%, and that dozens of units would have to be produced before they appear. Some operating costs, such as security, do not shrink with reactor size. UCS also points out that several vendors have increased module sizes, which it reads as a response to economies of scale.
The OECD Nuclear Energy Agency makes a related point in neutral terms. The attractive features of SMRs rely on a business case that requires the development of a global SMR market to become economically viable.
2. Few projects have been completed
Over 120 SMR designs are in development, according to the European Commission, but very few have been built. China's HTR-PM entered commercial operation in December 2023. Canada's first BWRX-300 at Darlington received its licence to construct in April 2025. The first U.S. commercial SMR project, the Carbon Free Power Project in Idaho, was terminated in November 2023 because, in the words of the developers, it appears unlikely that the project will have enough subscription to continue toward deployment.
Without a track record, first-of-a-kind cost and schedule risk fall on early customers.
3. Fuel supply: the HALEU problem
Many advanced SMRs and most microreactors need high-assay low-enriched uranium, enriched to between 5% and 20% U-235. DOE says HALEU is required for most U.S. advanced reactors to achieve smaller designs, and that the majority of these designs will require a fuel that is not yet available at a commercial scale. World Nuclear Association adds that HALEU needs new transport containers and fuel-cycle infrastructure.
UCS raises a further point. HALEU needs more natural uranium fed into enrichment per unit of energy, so it does not necessarily reduce mining. We compare the fuel paths in HALEU vs natural uranium.
4. Licensing takes time
Every reactor design and every site needs regulatory approval. DOE itself says significant technology development and licensing risks remain in bringing SMR technologies to market. A standard design approval, such as the one the NRC gave NuScale's US460 in May 2025, does not authorise construction at a site. Each project still needs its own licence. Regulators are also handling more applications than before.
5. Supply chain constraints
Large reactor pressure vessels rely on heavy forgings from a small number of suppliers worldwide. New fuel forms such as TRISO need new fabrication lines. Specialised components need qualified nuclear-grade suppliers. The NEA lists technical, economic, regulatory and supply chain challenges facing large-scale SMR deployment.
6. Used fuel and waste
SMRs still produce used nuclear fuel. UCS notes that entities that hope to acquire SMRs, like data centers that lack the necessary waste infrastructure, will have to safely manage the storage of significant quantities of spent nuclear fuel on site for the long term. A buyer has to plan for used-fuel storage from day one.
7. Safety claims need scrutiny
Many SMRs rely on passive safety: natural circulation and gravity rather than pumps and operator action. The European Commission sees this as extending the time operators have to respond to incidents. UCS cautions that passive features may not always work, especially during extreme events, and that relaxed rules on containment and emergency planning could offset some gains. The claims of each design should be judged on its own safety case, not on the SMR label.
8. Off-grid reliability is not a given
Data centres and industrial sites are often told that an SMR can power them independently of the grid. UCS argues it is very unlikely that any reasonably foreseeable SMR design would be able to safely operate without reliable access to electricity from the grid for safety systems, and that users would need backup power during outages. Whatever view one takes, a site plan should include backup and a clear operating mode for grid disturbances. See nuclear power for data centers.
9. Timing
Even supporters accept that SMRs arrive later than the demand. DOE said light-water SMRs would likely be deployed in the late 2020s to early 2030s. The IEA expects the first SMRs to come online around 2030. A load that needs power sooner has to be served some other way first.
How designs respond
Some of these disadvantages are inherent to fission and can only be managed: used fuel, licensing and first-of-a-kind risk. Others are design choices.
For timing, BridgePower Nuclear starts every site with thermal power from USP&E, which brings 24+ years in power and 150+ power projects in 45+ countries. The thermal block is designed to be deployed quickly, so the load does not wait for the reactor.
To discuss these trade-offs for your site, contact our team.
Frequently asked questions
What are the main disadvantages of small modular reactors?
The most cited are unproven economics at small scale, dependence on HALEU fuel for many advanced designs, long licensing timelines, supply chain limits such as heavy forgings, used-fuel management on site, and few completed projects to learn from.
Are small modular reactors cheaper than large reactors?
Not yet proven. SMRs need less capital per project, but critics such as the Union of Concerned Scientists argue that economies of scale make smaller reactors more expensive per unit of electricity unless factory production delivers large savings.
Why was the first U.S. SMR project cancelled?
UAMPS and NuScale agreed to terminate the Carbon Free Power Project in Idaho in November 2023 because it appeared unlikely to gain enough subscription to continue toward deployment.
Do SMRs produce nuclear waste?
Yes. Like any fission reactor, SMRs produce used fuel that must be stored and managed. UCS notes that users without existing waste infrastructure would have to store used fuel on site for the long term.
Can the disadvantages of SMRs be overcome?
Some can be designed around, such as using natural uranium to avoid HALEU, or plate vessels to avoid heavy forgings. Others, such as licensing time and first-of-a-kind cost, can only be reduced by building and operating units.