The government’s failure to deliver on a multimillion-pound competition to develop mini atomic power stations has hurt the nuclear sector and risks international companies walking away from the UK, a Lords committee has warned.

In 2015 the then chancellor George Osborne promised £250m over five years for a nuclear research and development programme, an undisclosed sum of which was for a competition to pave the way for small modular reactors.

These reactors are much smaller than conventional nuclear plants with a capacity of less than 300MW – or a 10th of what Hinkley Point C should provide.

But the government has failed to even publish results of the first phase of the competition, expected last autumn, which the Lords science and technology committee said was “particularly alarming”.

“This has had a negative effect on the nuclear sector in the UK and if the government does not act soon the necessary high level of industrial interest will not be maintained,” they said in a report on Tuesday.

The peers urged ministers to publish their plans for small modular reactors (SMRs) without delay, and scolded the government for not showing any urgency to make a decision.

The UK and US are vying to attract the companies and supply chains to research, develop and build small modular reactors. The industry argues they could be quicker and cheaper to build than normal nuclear power stations, partly by being prefabricated in factories.

Rolls-Royce, which is bidding for a slice of the competition funding, told the Lords it hoped to deploy a small modular reactor in the UK by 2028 if it had government backing.

The company is competing with Chinese state firm CNNC, US firm NuScale and the US-Japanese partnership GE-Hitachi. Toshiba’s US nuclear arm Westinghouse was also among the bidders but is now unlikely to proceed after filing for bankruptcy in March.

Newcastle-based Penultimate Power UK, which hopes to capitalise on the market, told the committee that a lack of clarity from government had paralysed development of nuclear power generation technology. “Without urgent action the window of opportunity for meaningful participation will soon close,” the company said.

Tom Greatrex, chief executive of the Nuclear Industry Association (NIA), said he shared the committee’s frustration and the competition had been “left hanging in the air”, with the roadmap for the reactors “lost somewhere in Whitehall”.

Trawsfynydd in Wales, the site of a former nuclear power station, has been pitched by the Welsh government as a potential site for the UK’s first SMR, because of its transport and power links, and skilled former nuclear workers.

A spokeswoman for the Department for Business, Energy and Industrial Strategy said: “The government recognises the potential of small modular reactors to help meet our energy and climate change challenges at a lower cost.”

Government officials said earlier this year that one of the attractions of mini nuclear power stations was they fitted with the industrial strategy launched by Theresa May. But Tom Wintle, deputy director at the business department, said they had to provide affordable power.



“SMRs will need to deliver energy cost-competitively if they are to play a part in the UK’s future energy mix. As well as securing low-carbon energy, government is also committed to keeping down the cost of that energy for consumers, so there is a key challenge there for the nuclear industry as a whole and for SMRs,” he told an industry conference.