The global energy market faces the simultaneous challenges of carbon neutrality, energy security and rising electricity demand. Expanding renewable energy alone cannot readily meet both reliable power supply needs and industrial heat demand. Large nuclear plants, with high initial capital costs and long construction periods, are also difficult to deploy uniformly across all regions and customers. In this context, small modular reactors (SMRs) are attracting attention as next-generation energy platforms that can supply electricity and heat tailored to customer needs and integrate with diverse industries.
This report provides a comprehensive analysis of the conditions required
for an SMR market to develop and the strategic opportunities available to
Korea, going beyond an introduction to the technology’s potential. It examines
SMR definitions and major reactor types, differences from large nuclear plants,
core value and structural constraints, then compares policies, technology
development and project progress in major countries. The analysis indicates
that the SMR market is likely to grow in stages as licensing, first-of-a-kind
(FOAK) demonstrations, supply chains, financing and offtake agreements develop,
rather than expand rapidly across all markets at once.
The economic analysis focuses on the differences between FOAK and
nth-of-a-kind (NOAK) plants. Although SMRs initially face substantial costs for
design, licensing and supply chain development, repeat application of standard
designs, factory fabrication and accumulated construction experience can reduce
construction costs and project risks. Competitiveness is therefore likely to
depend less on the absolute cost of initial projects than on how quickly a
repeat construction system can be established and reliable follow-on demand
secured.
The report also assesses technology suitability and growth potential
across key applications beyond electricity generation, including marine and
shipping, repurposing aging coal power plant sites, power for AI data centers
and advanced industries, industrial heat, hydrogen production and desalination.
It further examines the potential for integration with energy storage systems
to enhance output flexibility, grid stability, island operation and resilience.
Korea has a favorable starting position in the SMR industry, with
experience spanning nuclear plant design, equipment manufacturing,
construction, operation and overseas project delivery. If domestic
demonstration, standard design approval and initial reference projects progress
as planned, Korea can expand into overseas markets by drawing on its existing
nuclear, shipbuilding and plant engineering industries. Technology alone,
however, does not guarantee commercialization. It must be supported by
customer-linked business models, long-term electricity and heat purchase
agreements, project financing, regulatory frameworks and supply chains capable
of repeat manufacturing.
This report proposes that Korean SMRs should complement large nuclear
plants and renewables as selectively deployed, distributed carbon-free power
sources tailored to industrial demand and regional conditions, rather than
replace all power sources uniformly. Future market success will depend on the
ability to deliver initial projects successfully and turn them into repeatable
business and export models, alongside reactor technology.
<Contents>
1. Introduction
1.1 Summary
1.2 Nuclear Energy Overview
1.2.1 Nuclear Energy and the Principles of Nuclear Power Generation
1.2.2 Reactor Components
1.2.3 Evolution of Nuclear Energy Systems
1.3 From Large Nuclear Power Plants to Small Reactors
1.3.1 Limitations of Large Nuclear Power Plants
1.3.2 From Large Nuclear Power Plants to Small Reactors
2. SMR Overview
2.1 SMR Overview
2.1.1 Definition of SMRs
2.1.2 Advantages and Disadvantages
2.1.3 Differences from Large Nuclear Power Plants
2.2 Key Technology Types
2.2.1 Light-Water Reactors
2.2.2 High-Temperature Gas-Cooled Reactors
2.2.3 Molten Salt Reactors
2.2.4 Fast Reactors
2.2.5 Next-Generation Reactors
2.2.6 SMR Miniaturization Technology: Microreactors
2.3 Core Value of SMRs
2.4 Limitations and Structural Constraints
3. SMR Policy and Technology Trends
3.1 Global Policy and Technology Trends
3.1.1 United States
3.1.2 Canada
3.1.3 Europe
3.1.4 Russia
3.1.5 China
3.1.6 Japan
3.1.7 Korea
3.2 Key Projects
3.2.1 Construction and Licensing Progress
3.2.2 Key Projects by Country
3.3 Recent Technology Trends
3.3.1 Objectives of Next-Generation Reactors
3.3.2 Enhanced Passive Safety
3.3.3 Expanded Factory Fabrication and Modularization
3.3.4 Multipurpose Applications
3.3.5 Hybrid Energy Systems
4. Market Trends and Industry Ecosystem Analysis
4.1 Current Status of the Global SMR Industry
4.2 Key Drivers of Market Growth
4.2.1 Carbon Neutrality Policies
4.2.2 Rising Power Demand from Data Centers and Industrial Complexes
4.2.3 Demand for Coal Power Replacement
4.2.4 Demand for Grid Stability
4.3 Constraints on Market Growth
4.3.1 Technical Constraints
4.3.2 Economic Constraints
4.3.3 Policy and Institutional Constraints
4.3.4 Industry Ecosystem and Supply Chain Constraints
4.4 Supply Chain Analysis
4.4.1 Nuclear Industry Supply Chain Ecosystem
4.4.2 SMR Supply Chain Characteristics
4.4.3 SMR Supply Chain Development Status
4.4.4 SMR Nuclear Fuel Supply Chain Development
4.4.5 Supply Chain Bottlenecks and Solutions
4.5 Investment and Policy Support Trends
4.5.1 Global Investment Growth Trends
4.5.2 Global Investment, Partnership and Policy Support Trends
4.5.3 SMR Special Act
5. Economic Viability and Business Feasibility
5.1 Comparison of Large Nuclear Plants, SMRs and Renewables with ESS
5.1.1 Large Nuclear Plants, SMRs and Renewables + ESS
5.1.2 Integration of SMRs and Renewable Energy
5.1.3 Economic Value of SMR Load-Following Operation
5.2 Key Variables in SMR Economics
5.2.1 Construction Time, Capital, Capacity Factor and Other Variables
5.3 Differences Between FOAK and NOAK
5.3.1 Differences Between FOAK and NOAK
5.3.2 Accelerating Learning Effects
5.4 SMR Electricity Pricing and Business Models
5.5 Revenue Models Beyond Electricity Sales
5.5.1 Potential Non-Power Applications
5.5.2 Industrial Heat and District Heating
5.5.3 Desalination and Hydrogen Production
6. SMRs in Korea
6.1 Background to Korea’s SMR
Initiatives
6.2 Korean SMR Development Status
6.2.1 Direction of Korean SMR Development
6.2.2 Overview of Major Korean SMRs
6.2.3 Korean SMR Development Status and Expected Benefits
6.2.4 Korean SMR Commercialization Strategy
6.3 Korea’s Nuclear Industry Base and
Potential for SMR Transition
6.3.1 Potential for Korea’s Nuclear
Industry to Transition to SMRs
6.3.2 SMR Transition Prospects for Korean Nuclear Companies
6.4 Government Policy, R&D and Commercialization Roadmap
6.5 Regulatory Framework and Licensing Conditions
6.6 SMR Export Industry Potential
6.7 Korea’s Electricity Market Structure
and SMR Suitability
6.8 Korea’s SMR Strategy
7. Applications and Feasibility Analysis
7.1 Overview of Key SMR Applications
7.1.1 Applications and Requirements
7.2 Marine and Shipping Applications
7.2.1 Overview of Nuclear-Powered Ships
7.2.2 Global Development Trends
7.2.3 Progress and Application Potential in Korea
7.2.4 Challenges to Commercializing SMR-Powered Ships
7.3 Power System Applications
7.3.1 Replacement of Aging Coal Power Plants
7.3.2 Distributed Generation and Grid Stabilization
7.4 AI Data Centers and Next-Generation Power Demand
7.4.1 Rising Power Demand in the AI Era
7.4.2 The Need for SMR Deployment
7.5 Industrial Processes and Energy Applications
7.5.1 Industrial Heat Supply and District Heating
7.5.2 Hydrogen Production and Desalination
7.6 Technology Suitability by Application
7.7 Deployment Scenarios for Korea
8. Challenges to SMR Deployment in Korea
8.1 Technology Development for SMR Commercialization
8.1.1 Korean SMR Technology Development Priorities
8.1.2 Completing Standard Designs and Securing Demonstration Reactors
8.1.3 Developing Key Equipment and Supply Chains
8.1.4 Modularization and Construction Innovation
8.2 Policy Challenges
8.2.1 Overview of Korea’s SMR Institutional Framework
in 2026
8.2.2 Establishing a Regulatory Framework
8.2.3 Improving Licensing Procedures
8.2.4 Improving Site Selection and Siting Rules
8.2.5 Incorporating SMRs into Power Supply Plans
8.3 Financing and Market Framework Challenges
8.3.1 Financial Support for Initial Projects
8.3.2 Cost Recovery Mechanisms
8.4 Public Acceptance Challenges
8.5 Industrial Policy Challenges
8.5.1 Strengthening Competitiveness through Ecosystem Integration
8.5.2 Building an Export-Oriented SMR Ecosystem
9. SMR-Based Hybrid Energy Systems
9.1 SMR Operating Characteristics and the Value of Energy Storage
Integration
9.2 Hybrid Energy Systems (HES)
9.2.1 Overview of Hybrid Energy Systems
9.2.2 SMR + Battery ESS
9.2.3 SMR-Thermal Energy Storage
9.2.4 Potential for SMR + Renewables + ESS Integration
9.3 Expected Benefits and Conditions for Energy Storage Integration
9.3.1 Improved Grid Flexibility
9.3.2 Optimized Energy and Equipment Operation
9.3.3 Improved Supply Reliability and Resilience
9.4 Economic Feasibility of SMR–Energy Storage Integration
9.4.1 Economic Feasibility of SMR–ESS
Integration
9.4.2 Economic Assessment of Second-Life Battery
Applications
9.5 Research and Demonstration Cases in Korea and Abroad
9.5.1 Overseas Commercial and Licensing Cases
9.5.2 Overseas Research and Experimental
Platforms
9.5.3 ESS Integration with Korea’s i-SMR
9.6 Deployment Models for Korea
9.6.1 Domestic Deployment Priorities
9.6.2 Phased Demonstration and Commercialization Strategy
10. Market Outlook and Strategic Opportunities for Korea
10.1 Global SMR Market Size Outlook
10.1.1 Near-Term Deployment Outlook
10.1.2 Deployment Outlook by Scenario to 2050
10.1.3 SMR Deployment Outlook by Year
10.1.4 SMR Deployment Outlook by Region
10.1.5 SMR Deployment Outlook by Reactor Type
10.2 Key Demand Drivers of Market Growth
10.3 Market Development Outlook by Application
10.4 Potential Market for SMR-Integrated ESS
10.5 Strategic Priority Markets for Korean SMRs
10.5.1 Criteria for Assessing Priority Markets for Korean SMRs
10.5.2 Competitiveness and Entry Requirements by Market
10.5.3 Priorities and Phased Market Entry Strategy
10.6 Phased Development Outlook for the Global SMR Market
10.7 Overall Conclusions and Strategic Implications
11. Conclusion
11.1 Overall Conclusions
11.2 Positioning SMRs in Korea
11.3 SMRs as a Next-Generation Alternative Power Source
Appendix.
1. Glossary
2. Methodology