• A  nine-member association of companies have pledged to build 16 small nuclear power stations by 2050
  • Each mini reactor would be in operation for up to 60 years and provide 440 megawatts of electricity per year
  • The program is expected to create 40,000 jobs.

The British government is considering investing 2 billion pounds sterling ($2.6 billion) to help build small nuclear reactors as part of London’s overall strategy of developing cleaner energy and achieving net-zero carbon emissions by 2050.

The financing program – details of which have yet to be finalized, Bloomberg reported – would involve the government buying an equity stake in various new small nuclear stations across the country. Smaller reactors, as the government envisions, may be a more economical strategy to build up nuclear power in the country.

Indeed, a nine-member consortium of companies, including Rolls-Royce Holdings Plc and construction giant Laing O’Rourke Plc, have pledged to build 16 small nuclear power stations by 2050 on existing nuclear sites. This program is expected to create 40,000 jobs.

Each mini reactor would be in operation for up to 60 years and provide 440 megawatts of electricity per year — enough to power the city of Leeds (a city of 480,000 people), Financial Times reported.

The government's funds “should deliver sufficient cash to get the consortium through building the factories and well on the way to construction of power stations prior to finding more money from other sources,” a source told FT.

“Nuclear power will play a key role in the U.K.’s future energy mix as we transition to a low-carbon economy, including through our investments in small and advanced modular reactors,” a spokesperson for the Prime Minister said.

The government’s initial investment would be part of the first tranche to construct five such small nuclear stations.

“There is a broad strategic commitment and the way in which the finance is arrived at and categorized are questions for further debate,” Energy Minister Kwsai Kwarteng said at the Conservative Party conference on Tuesday.

Prime Minister Boris Johnson is a big supporter of nuclear power and renewable energy. At the Conservative Party conference on Tuesday, he vowed the U.K. will become a “world leader in low-cost clean power generation.”

“Imagine that future – with high-skilled, green-collar jobs in wind, in solar, in nuclear, in hydrogen and in carbon capture and storage,” Johnson said.

The U.K. currently has just one large-scale new nuclear project in the pipeline – the Sizewell C plant in Suffolk, which is expected to be built by French utility Electricite de France SA, or EDF.

While the U.K. government said it is committed to nuclear energy, further plant construction will depend upon financing and eager investors.

“In Sizewell C we think we have the design, a supply chain and industry and what we need now is a funding model,” said Simone Rossi, chief executive officer of EDF’s U.K. subsidiary.

If EDF can secure a mix of government and private funding, it hopes to begin construction of Sizewell in 2021. The plant is expected to cost 20 billion pounds ($25.8 billion) to build.

The large Hinkley Point C nuclear power station is under construction in Somerset, England. It is expected to start generating electricity in 2025, EDF is financing its construction. However, that huge project is late and overbudget.

Meanwhile, the government is scheduled to release a much anticipated white paper on its nuclear power strategy in a few weeks. Tom Greatrex, chief executive officer of the Nuclear Industry Association trade group, said if the government purchased an equity stake, that would “cut the cost of capital for new nuclear power stations.”

“Setting out a new financing model is vital to progress the new nuclear projects we need to create jobs and hit net zero,” Greatrex added.