Key Takeaways

• Nuclear power is one of the few technologies that can economically and technologically meet the thermal needs of industrial process heat applications up to 950 degrees C (1,742 degrees F).
• Retrofitting facilities (e.g., manufacturing, universities, hospitals) currently utilizing natural gas-fired combined heat and power systems would reduce U.S. annual carbon dioxide emissions by at least 75 million metric tons per year.
• Small modular reactors can scale to fit a wide range of industrial needs; given their modularity and geographic independence, they will be capable of supplying safe, reliable thermal energy and electricity.
• Early projects, such as the X-energy and Dow partnership, have encouraged other companies to consider nuclear technology for their own facility needs.
• A thriving hydrogen market could help drive demand for nuclear combined heat and power applications, as production of hydrogen from nuclear plants becomes more cost-effective and usable due to increased hydrogen infrastructure.
• Continued public investments in development, deployment, and licensing of nuclear reactor technologies and fuel supply is essential to encourage private investments.
• Highly-scalable, zero-emission technologies like nuclear energy will be necessary to meet growing demand from electrification, artificial intelligence, and other new sources of electricity and heating demand. Encouraging advanced nuclear for process heat in these and similar applications could help (e.g., develop, scale, reduce costs) the technology, making nuclear more accessible for electricity generation.

Executive Summary

The industrial sector is responsible for about 30 percent of U.S. greenhouse gas emissions. Many of these emissions come from the heat needed for industrial processes in subsectors such as steel, concrete, chemicals, and glass production, since these subsectors typically rely on low-cost, high-emitting fossil fuels as their primary source for uninterrupted thermal energy. To reduce dependence on fossil fuels and achieve decarbonization targets, non-emitting heat sources that meet the unique challenges of powering the industrial sector must be further developed and deployed in the near future. Advanced nuclear technologies could play both direct and indirect roles in providing such heat, and their inherent safety, siting flexibility, modularity, and small land footprint could enable cost-effective deployment at a wide range of locations.

Existing nuclear power plants and new advanced nuclear reactors could directly provide heat at a range of temperatures and at the high capacity factors (i.e., almost always on availability) needed by many industrial users, which means nuclear reactors could effectively replace much of the heat currently generated by fossil fuels. In addition, electricity from advanced reactors could power electrified heat options (e.g., industrial heat pumps) and production of zero-carbon hydrogen, as well as carbon capture technology that could further decarbonize industry.

Accelerating the deployment of advanced nuclear reactors faces a range of challenges, including cost concerns, regulatory delays, supply chain risks, inadequate workforce, lack of a long-term plan for storage of nuclear waste, non-proliferation concerns, and opposition from some states and communities. Recent policy actions in Congress, the U.S. Department of Energy (DOE), and the Nuclear Regulatory Commission (NRC) have sought to mitigate some of these challenges, including through robust funding for nuclear deployments, support for boosting domestic nuclear fuel production, and development of new regulatory review pathways.

More is needed, however, to drive technological advancements and widespread deployment. Necessary policies include:

Additional financial and technical support: Additional public dollars for research, development, and deployment of advanced nuclear reactor technologies (inclusive of fuel and other supplies) and for workforce development, along with expanded technical support for industrial facilities looking to adopt advanced nuclear technologies, could help spur further private investment and develop an advanced nuclear market in the United States.

NRC action and support: Efforts to finalize new, more efficient licensing procedures for advanced nuclear reactors must continue, and the NRC needs additional staff and resources to handle the anticipated volume of applications for new reactors in the near future.

Carbon pricing: Market-based solutions to incentivize emissions reductions would encourage and improve the cost-competitiveness of industrial decarbonization efforts. A price on greenhouse gas emissions would reflect the true cost of emitting carbon (e.g., costs to society such as damage from more extreme weather); with a market-based incentive, businesses and consumers will take steps to decarbonize, including deploying innovative advanced nuclear technologies and fuels, to avoid increased costs and remain economically viable.

Industrial decarbonization is key to the United States achieving its 2050 net-zero climate target. Advanced nuclear technologies, if adequately supported and developed, could complement an array of other clean energy technologies in making such decarbonization a reality while supporting increased U.S. energy security and economic growth.

About Our Closer Looks

Achieving net-zero emissions will require large-scale change across all sectors of the economy, and efforts to drive this transition are intensifying. Over the past several years, through the Climate Innovation 2050 initiative, the Center for Climate and Energy Solutions (C2ES) has engaged closely with leading companies across diverse sectors to examine challenges and solutions to decarbonizing the U.S. economy by 2050. As we lay out in Getting to Zero: A U.S. Climate Agenda, reaching net zero will require large-scale change, but it will also require us to address a number of discrete and urgent challenges. To inform policymakers considering these near- and long-term questions, C2ES launched a series of “Closer Look” briefs to investigate important facets of the decarbonization challenge, focusing on key technologies, critical policy instruments, and cross-sectoral challenges. These briefs explore policy implications and outline key steps needed to reach net zero by mid-century.