DE-FOA-0003485 - GenIII+SMR Working BAA - Final - For Release.pdf

1. REVIEW 2. GET READY 3. SUBMIT 4. SELECTION 5. REQUIREMENTS 6. CONTACTS

U.S. Department of Energy

Office of Clean Energy Demonstrations & Office of Nuclear Energy with support from the National Nuclear Security Administration

Generation III+ Small Modular

Reactor Pathway to Deployment

Broad Agency Announcement (BAA) Solicitation Number: DE-FOA-0003485

Applications Due: January 17, 2025

Questions about this solicitation? Email Gen3PlusSMR@hq.doe.gov.

Problems with OCED eXCHANGE? Email OCED-ExchangeSupport@hq.doe.gov

Include Solicitation name and number in subject line.

mailto:Gen3PlusSMR@hq.doe.gov mailto:OCED-ExchangeSupport@hq.doe.gov

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Step 1: Review the Solicitation Basic Information

Eligibility

Program Description

Step 2: Get Ready to Apply Application Contents and Format

Step 3: Submit Your Application Submission Requirements and Deadlines

Application Responses

Step 4: Learn About Review and Selection Application Review Information

Application Responses

Step 5: Learn about Post-Selection and Post-Award Requirements Post-Selection Information Requests and Submissions

Post-Award Requirements and Administration

Reporting

Step 6: Contacts and Support Agency Contacts

Helpful Websites

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Before you begin If you believe you are a good candidate for this funding opportunity, secure your SAM.gov and other registrations now. If you are already registered, make sure your registration is active and up to date.

All registrations are free.

SAM.gov registration (this can take 1-2 months) You must have an active account with SAM.gov. This includes having a Unique Entity Identifier (UEI).

OCED eXCHANGE (this can take 48-72 hours) Register with OCED eXCHANGE using Login.gov or ID.me.

FedConnect (this can take 48-72 hours) Registering with FedConnect® is fast and easy. Only individuals who are designated as Points of Contact in SAM.gov can create a new company account.

Apply by January 17, 2025 Applications are due by 5:00 p.m. Eastern Time.

For additional details on submitting your application see Step 3: Submit Your Application.

https://sam.gov/content/home https://oced-exchange.energy.gov/ https://www.fedconnect.net/FedConnect/Default.htm

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

STEP 1:

REVIEW THE FUNDING

OPPORTUNITY

IN THIS STEP

Basic Information

Eligibility

Program Description

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Basic Information

Funding Detail Expected total available funding: $900 million total

• Tier 1: Up to $800 million for first mover team support (see Executive Summary for tier description)

• Tier 2: Up to $100 million for fast follower deployment support (see Executive Summary for tier description)

Expected number and type of awards:

• Tier 1: Up to two awards through the Department of Energy’s (DOE) Other Transactions (OT) authority

• Tier 2: Multiple OT awards

Expected award project period: The maximum expected project period is approximately up to 10 years for grid scale Generation III+ (Gen III+) small modular reactor (SMR) deployments and up to 5 years for Tier 2 activities.

Depending on the number and quality of Applications received, DOE may not award the full funding amount available and may issue other solicitations, subject to the availability of appropriations, to support additional strategies and approaches or incorporate lessons learned from the first round of Applications.

Statutory Authority Consolidated Appropriations Act, 2024 (CAA 2024, Public Law 118-42)1 and the Chips and Science Act (Chips Act, Public Law 117 – 167)2. Section 311 of the CAA 2024 made up to $800,000,000 of unobligated Infrastructure Investment and Jobs Act (IIJA, Public Law 117-58) funds available for not more than two commercial utility deployment projects for grid scale Gen III+ SMR designs ($200,000,000 in fiscal year 2024, $300,000,000 in fiscal year 2025, and up to $300,000,000 in fiscal year 2026) pursuant to section 959A of the Energy Policy Act of 2005 (42 U.S.C. 16279a). Section 959A of the Energy Policy Act of 2005 allows for the use of DOE’s authority to issue milestone-based Other Transaction Agreements pursuant to 42 U.S.C 7256c.

The CAA 2024 also made available an additional $100,000,000 for one or more competitive awards supporting design, licensing, supplier development, and site preparation of a grid-scale Gen III+ reactor design. Subtitle P of the Chips Act (Sec. 10781), titled ‘Fission for the Future,’ authorizes the Secretary of Energy to establish a program to provide federal financial assistance to eligible entities to support the research, development, and demonstration of advanced nuclear concepts. Awards under this program will be milestone-based Other Transaction Agreements pursuant to 42 U.S.C. 7256(a).

1 https://www.congress.gov/118/bills/hr4366/BILLS-118hr4366enr.pdf 2 https://www.congress.gov/117/plaws/publ167/PLAW-117publ167.pdf https://www.federalregister.gov/documents/2006/05/09/06-4119/assistance-regulations https://www.congress.gov/118/bills/hr4366/BILLS-118hr4366enr.pdf https://www.congress.gov/117/plaws/publ167/PLAW-117publ167.pdf

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Agency Contact Information Office of Clean Energy Demonstrations Office of Nuclear Energy U.S. Department of Energy 1000 Independence Ave SW Washington, D.C. 20585 Email: Gen3PlusSMR@hq.doe.gov mailto:Gen3PlusSMR@hq.doe.gov

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Executive Summary Nuclear energy is the nation’s largest source of carbon-free power, and it provided 48 percent of America’s carbon-free electricity in 2023. The nuclear industry today is building new commercialization momentum as utilities and other potential customers see the successful operation of Vogtle Units 3 and 4, anticipate sustained load growth, and begin to take advantage of tax credits and other financial support made available by the Inflation Reduction Act. Utilities are seeking and receiving Nuclear Regulatory Commission (NRC) licensees to extend reactor operations to 80 years, planning to uprate reactor capacity, reversing plans to close reactors, and restarting formerly shuttered reactors. However, the industry must still overcome barriers to achieve commercial liftoff by securing committed investments in an orderbook of new nuclear projects and standing up the industrial base needed for fleet-level deployment.

Accelerating Generation III+ small modular reactor (Gen III+ SMR) deployments and creating a sustainable infrastructure for future fleet-level deployments offers a way to break this stalemate. Gen III+ SMR designs are expected to provide the same or improved safety, security, and environmental benefits compared to current large nuclear power plant designs while allowing for deployment of clean, firm power where large gigawatt-size reactors may not be optimal.

This solicitation offers critical opportunities to spur “first mover” teams to deploy the first Gen III+ SMRs in the United States (U.S.) and to provide funding for “fast follower” deployment support, which will address key gaps that have hindered the domestic nuclear industry. Activities funded under this solicitation are expected to create high-paying jobs for American workers, offer opportunities for broadly shared prosperity in the communities which the reactors are located, and enable a cleaner, more equitable future for all Americans.

Demonstrating the technical and commercial viability of Gen III+ SMRs with a potential for fleet level deployment will promote widespread technology implementation while supporting the Administration’s objectives of (1) putting the U.S. on a path to a 100 percent clean power sector by 2035; (2) reaching net-zero emissions, economy-wide, by no later than 2050; (3) maintaining the Nation’s technological leadership position in the global nuclear industry; and (4) ensuring national energy security.

To maximize the potential of these funds, DOE will offer project funding under this solicitation through two tiers:

• Tier 1 will provide up to $800M to support up to two first mover teams of utility, reactor vendor, constructor, and end-users/off-takers committed to deploying a first plant while facilitating a multi-reactor, Gen III+ SMR orderbook and the opportunity to work with the National Nuclear Security Administration (NNSA) to incorporate safeguards and security by design into the projects.

• Tier 2 will provide up to $100M to spur additional Gen III+ SMR deployments by addressing key gaps that have hindered the domestic nuclear industry in areas such as design, licensing, supplier development, and site preparation.

This solicitation leverages DOE’s OT authority3 (pursuant to 42 U.S.C. 7256(a) and (g)).4 Milestone-based OT agreements will be used as the structure for the awards between the Department and the awardee(s) to provide flexibility around activities that will receive federal funds in the overall project structure. DOE will work with

3 Other Transaction Authority | Department of Energy, https://www.energy.gov/management/other-transaction-authority 4 Other Transaction Authority | Department of Energy, https://www.energy.gov/management/other-transaction-authority https://www.govinfo.gov/content/pkg/USCODE-2023-title42/pdf/USCODE-2023-title42-chap84-subchapVI-partC-sec7256.pdf https://www.energy.gov/management/other-transaction-authority https://www.energy.gov/management/other-transaction-authority https://www.energy.gov/management/other-transaction-authority https://www.energy.gov/management/other-transaction-authority

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov project performers to tailor their specific approach after selections and anticipates that implementation approaches will vary between projects.

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Table 1. Program overview. All values anticipated. Details to be determined through merit reviews and project negotiations.

Tier Description* Funding Provision

Anticipated # of

Awards**

Anticipated Award

Duration*

Anticipated Federal Funding per Award***

1. First Mover Team Support

Near-term grid-scale deployment of domestic Gen III+ SMR technologies that are reliable, licensable, commercially viable, and have a demonstrated path towards a multi-reactor orderbook.

CAA 2024

Section 311(a)(1)(A)

Up to 2 Up to 10 years

Up to $800M total ($200M in FY24, $300M FY25, up to $300M in FY26 based on milestones and funding split between awards)

Opportunity to engage with NNSA on safeguards and security by design efforts in support of international orderbook development.

Up to 2;

available after award to Tier 1 recipients and teaming partners

Up to 3 years

$1.0M – 3M in FY25- 27, plus possible in-kind support, based on milestones and funding splits between awards.

Outyears subject to appropriations.

2. Fast Follower Deployment Support

Spur additional Gen III+ SMR deployments by addressing key gaps that have hindered the domestic nuclear industry in areas such as design, licensing, supplier development, and site preparation.

CAA 2024

Section 311(a)(2)

Multiple Awards

Up to 5 years

$100M total (FY24) split between multiple awards

*For more details, see Tier Descriptions.

**Depending on the number and quality of applications.

***Federal share of funds for all awards is less than or equal to 50 percent total project costs.

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Eligibility

Eligible Applicants To be considered for substantive evaluation, an applicant's submission must meet the criteria set forth below. If the application does not meet all these eligibility requirements, it will be considered ineligible and removed from further evaluation.

DOE will not make eligibility determinations for potential applicants prior to the date on which applications to this solicitation must be submitted. The decision whether to submit an application in response to this solicitation lies solely with the applicant.

Eligible Applicants

The proposed prime awardee must meet the applicable eligibility requirements as defined for each tier below.

Tier 1: First Mover Team Support

Eligible entities will consist of a lead applicant who must be a U.S. commercial electric utility (utility), a U.S.

end-user/off-taker who has teamed with a utility, a U.S. project development company who has teamed with a utility, or an incorporated consortium that includes a utility.5 The lead applicant’s team must include a U.S.

Gen III+ SMR technology vendor and a U.S. engineering, procurement, and construction (EPC) contractor. If these entities are still being finalized during selection, DOE will prioritize team finalization as early as possible and will tailor milestones as appropriate.

Gen III+ SMR technology vendors, fuel manufacturers, supply chain vendors, EPC contractors, and other domestic nuclear industry entities are eligible to participate in multiple applications under this solicitation.

The reactor technology vendor and proposed U.S. Nuclear Regulatory Commission (NRC) licensee, when determined, should also submit information to show that they are not owned, controlled, or dominated by an alien, a foreign corporation, or a foreign government as set forth in the NRC’s regulations at 10 CFR 50.38, and that their application would not be inimical to the common defense and security or public health and safety as required by 10 CFR 50.40. Foreign team members and vendors may be proposed as part of an applicant team.

Tier 2.1: SMR Site Selection and Preparation

Eligible entities under Tier 2.1 are limited to planned U.S. owners or utilities for domestic Gen III+ SMR deployment projects. Reactor technology vendors, fuel manufacturers, supply chain vendors, EPC contractors or other domestic nuclear industry entities are allowed to support the eligible entities for this tier.

Tier 2.2: SMR Supply Chain Development

Eligible entities under Tier 2.2 are limited to domestic entities looking to improve the capability, capacity, or cost competitiveness of the domestic supply chain needed for the near-term deployment of Gen III+ SMRs.

5 Commercial utility includes municipal, Tribal, and other government utilities, including the Tennessee Valley Authority, but does not include DOE’s Power Marketing Administrations.

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Tier 2.3: SMR Project Improvement

Eligible entities under Tier 2.3 are limited to planned U.S. owners or utilities for domestic Gen III+ SMR deployment projects. Reactor technology vendors, fuel manufacturers, supply chain vendors, EPC contractors or other domestic nuclear industry entities are allowed to support the eligible entities for this tier.

Other Eligibility Criteria

Domestic and Foreign Entities For all Topic Areas, the proposed prime awardee must be domestic entities. To qualify as a domestic entity, the entity must be organized, chartered, or incorporated (or otherwise formed) under the laws of the U.S. or of a particular state or territory of the U.S.; have majority domestic ownership and control; and have a physical place of business in the U.S.

Entities that are eligible as team members or that can be contracted under this solicitation include, but are not limited to:

• Scientist or other individual with knowledge and expertise in Gen III+ SMRs;

• An institution of higher education;

• Nongovernmental organization, including Tribal entities;

• National Laboratory;

• Tribal or governmental entities;

• Private entity; and

• Partnership or consortium of two or more entities described in this list.

Federal agencies and instrumentalities (other than DOE and TVA), Federally Funded Research and Development Centers (FFRDC), and Non-DOE/NNSA FFRDCs, are eligible to participate only as a team member.

Entities banned from doing business with the U.S. government such as entities debarred, suspended, or otherwise excluded from or ineligible for participating in Federal programs are not eligible.

Entities identified on Department of the Treasury Office of Foreign Assets Control Treasury ’s Sanctions Program Specially Designated Nationals list are prohibited from doing business with the Unites States government and are not eligible. See OFAC - Sanctions List Service (treas.gov).

Entities of Concern are prohibited from participating in projects selected under this solicitation (see the Entity of Concern Prohibition section for additional details and definitions).

Non-profit organizations described in Section 501(c)(4) of the Internal Revenue Code of 1986 that engaged in lobbying activities after December 31, 1995, are not eligible to apply for funding. Non-profit organizations described in Section 501(c)(5) of the Internal Revenue Code are eligible to apply for funding.

https://sanctionslist.ofac.treas.gov/Home/SdnList

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Entity of Concern Prohibition

Prohibition Entities of Concern are not eligible. DOE is prohibited by law from funding any award, grant, contract, cooperative agreement, loan, program, support, or other activity of $10 million or more in DOE funds to Entities of Concern. In addition, such entities (including an individual that owns or controls, is owned or controlled by, or is under common ownership or control with an entity of concern) are prohibited from receiving any funds or performing work under any award involving Department activities authorized under Division A or B of Public Law 117-167, subject to certain penalties. See section 10114 of Public Law 117-167 (42 USC 18912) and section 310 of Public Law 118-42 and other applicable law for additional information.

By submitting an application to this solicitation, the prime applicant is certifying that neither the prime applicant nor any of the project participants qualify as Entities of Concern.

Definitions Entity of Concern is defined as in section 10114 of Public Law 117-167 (42 USC 18912), also known as the CHIPS and Science Act, as any entity, including a national, that is—

(A) identified under section 1237(b) of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 (50 U.S.C. 1701 note; Public Law 105–261);

(B) identified under section 1260H of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021 (10 U.S.C. 113 note; Public Law 116– 283);

(C) on the Entity List maintained by the Bureau of Industry and Security of the Department of Commerce and set forth in Supplement No. 4 to part 744 of title 15, Code of Federal Regulations;

(D) included in the list required by section 9(b)(3) of the Uyghur Human Rights Policy Act of 2020 (Public Law 116–145; 134 Stat. 656); or

(E) identified by the Secretary, in coordination with the Director of the Office of Intelligence and Counterintelligence and the applicable office that would provide, or is providing, covered support, as posing an unmanageable threat—

(i) to the national security of the U.S.; or

(ii) of theft or loss of U.S. intellectual property.

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Milestones and Costs The DOE award contribution can never exceed 50 percent of total project cost. At every point in time from the initiation of the award, the applicant must have contributed at least 50 percent of the total project costs incurred from the time of award. DOE requires applications to include proposed milestones with defined work scope and related milestone payments and to include in their application a project spend plan which shows the total anticipated project cost at the time of each milestone completion. DOE will review and evaluate the applications to ensure that the requested milestone payments adhere to this requirement. DOE may give preference to applications where the applicant team proposed substantially more applicant project cost share as part of the program policy factors. Applicant project cost share must come from non-federal sources, such as private investment from project participants, state or local governments, or third-party financing, unless otherwise allowed by law.6

Eligible applicant teams will be paid upon the successful completion of pre-negotiated milestones. The integral amount of federal payments made to the applicant team upon each milestone completion cannot be more than 50 percent of the costs incurred from the time of award to that milestone payment. For example, at the completion of the third milestone, if all three milestone payments amount to $100 million, then the applicant must ensure minimum total project cost incurred through completion of the third milestone is equal to or exceeds $200 million. DOE expects the project teams to propose milestone timing and amounts that account for this cost share constraint and to include in their application a project spend plan which shows the total anticipated project cost at the time of each milestone completion.

Federal financing, such as DOE Loan Guarantees, cannot be leveraged concurrently with this award by applicants to pay project costs. Generally, realized tax credits may be used for project costs.7

Each project team is free to determine how to best allocate project costs among the team members. The amount contributed by individual project team members for each milestone may vary.

The prime awardee is responsible for costs relating to each milestone and the project overall. DOE encourages the prime awardee to achieve cost savings throughout the project life cycle. However, should cost savings be realized such that the agreed upon DOE share would exceed 50 percent of the project at any point during the award, the prime awardee will be responsible for notifying DOE and agreeing to a reduced milestone payment. In this event, subsequent milestone payments could be renegotiated to account for a reduced milestone payment provided overall spending allows for at least 50 percent non-federal contribution. If the funding agreement is terminated prior to the successful completion of a milestone, the prime awardee will be responsible for the total expenditures incurred.

Limitation of Number of Applications Eligible for Review An entity may submit more than one application to this solicitation and to more than one tier provided each application describes a uniquely distinct project.

6 EPAct05 Section 988 (d)(1)(E) provides that any funds received under the power program of the Tennessee Valley Authority (except to the extent that such funds are made available under an annual appropriation Act) is allowable as non-Federal cost share for TVA.

7 Tax credits authorized by the Inflation Reduction Act of 2022 (P.L. 117-169) are considered a non-federal source and are not a federal award.

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Program Description

Purpose This solicitation makes available approximately $900 million in federal funds for projects that will create a credible and sustainable pathway to fleet-level deployment of Gen III+ SMRs. Gen III+ SMRs can provide around-the-clock electricity or process heat to meet the increasing demand for clean, reliable, firm electricity generation or process heat required by U.S. industries.

In particular, SMRs offer the potential for modularity, factory construction, and scalability to meet demand.

Additionally, Gen III+ SMRs may be able to revitalize and leverage the service and supply chain infrastructure supporting the existing fleet of light water reactor designs, thus providing a near-term path for new nuclear deployments. However, a demonstration project is critical to overcoming the first-of-a-kind commercial adoption challenges for Gen III+ SMR technology, including:

• Cost Reliability – Delivered cost of recent reactor projects, including cost-overruns and project non-completion, has constrained nuclear energy relative to competing baseload technologies, such as natural gas.

• Resource Maturity – Multiple factors have hindered adoption including:

o Capital Flow – Delays and non-completion of past nuclear projects has resulted in capital flow constraints, where the return of capital and return on capital are on time horizons that inhibit investors and significantly impact an owner’s credit rating.

o Project Development, Integration, and Management – There is no leading constructor for new nuclear projects and the lack of integrated project delivery models has constrained prior projects.

o Manufacturing and Supply Chain – The current domestic nuclear supply chain faces severe bottlenecks on long-lead procurements for major project components. This lack of resilience in capacity, capability, and cost competitiveness is forcing procurements overseas.

o Workforce – The limited number of nuclear-qualified workers, such as welders and plant operators, presents a challenge to scaling nuclear deployments.

• Licensing Uncertainty – The risk of licensing new technologies, including the timeframe and cost associated with receiving NRC approval of new nuclear designs, drives hesitancy for potential adopters.

Funding applications will be selected based on the expectations and details described throughout this solicitation. Priority will be given to projects with (1) the highest probability of a successful deployment,

(2) the greatest potential to develop a Gen III+ SMR orderbook, and (3) the greatest potential contribution to the resilience of the domestic nuclear industry.

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Terminology Projects funded through this solicitation will be near-term commercial deployments of a Gen III+ SMR technology in the U.S. and efforts that address key gaps which have hindered the domestic nuclear industry in areas such as design, licensing, supplier development, and site preparation.

For the purposes of this program, the following terms are defined:

An Early Site Permit (ESP) is defined by the NRC as a permit granted by the NRC to approve one or more proposed sites for a nuclear power facility, independent of a specific nuclear plant design or an application for a construction permit or combined license. An ESP is valid for 10 to 20 years but can be renewed for an additional 10 to 20 years.

An end-user/off-taker is defined as any entity that will use the electrical energy or heat generated by the plant either through an established electrical distribution grid or directly from the plant, or a load-serving entity that directly serves ratepayers.

A Gen III+ SMR is defined as a nuclear fission reactor that: (1) uses light water as a coolant and low-enriched uranium (LEU) as a fuel; (2) has a single-unit net electrical power output between 50 – 350 mega-watts electric (MWe) as part of a single-unit or multi-unit plant with no restriction on the total plant power output;

(3) maximizes factory fabrication approaches: and, (4) includes significant improvements compared to reactors operating on December 27, 2020, including improvements such as--

(i) additional inherent safety features;

(ii) lower waste yields;

(iii) improved fuel and material performance;

(iv) increased tolerance to loss of fuel cooling;

(v) enhanced reliability or improved resilience;

(vi) increased proliferation resistance;

(vii) increased thermal efficiency;

(viii) reduced consumption of cooling water and other environmental impacts;

(ix) the ability to integrate into electric applications and non-electric applications;

(x) modular sizes to allow for deployment that corresponds with the demand for electricity or process heat; and

(xi) operational flexibility to respond to changes in demand for electricity or process heat and to complement integration with intermittent renewable energy or energy storage.

An incorporated consortium is defined as an independently governed group of two or more entities with the shared objective of achieving fleet-level domestic commercial deployments of Gen III+ SMRs.

Incorporated consortia must establish an internal governance structure and a written set of internal rules that will be shared with the Department. For the purposes of this solicitation, the incorporated consortium must include a U.S. commercial utility, and must be incorporated at the time of award.

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

A project development company is defined as a corporation, limited liability company, or partnership that develops, constructs, and owns power generation or other energy infrastructure projects. Example responsibilities of a project development company include strategic site assessment, land origination, project financing, permitting, interconnection, offtake contracting, equipment purchasing, and/or EPC contractor selection.

A reactor technology vendor is defined as a company or organization that designs nuclear reactor power plant systems to be sold or operated as part of a nuclear power plant installation project. Example responsibilities of a reactor technology vendor include designing nuclear reactor components (nuclear island) and/or balance of plant systems.

A U.S. commercial utility (utility) is defined as a person, individual or a corporation, or federal, Tribal, state, local/municipal agency or corporation, including the Tennessee Valley Authority (TVA), that sells electric energy.

General Expectations for Both Tiers The primary objective of the Gen III+ SMR Pathway to Deployment program is to focus DOE and non-federal resources on a credible and sustainable pathway to fleet level deployment of Gen III+ SMRs by both accelerating the deployment of the first Gen III+ SMRs in the U.S. and enabling “fast follower” deployments by addressing key gaps that have hindered the domestic nuclear industry in areas such as design, licensing, supplier development, and site preparation. Applications made under this solicitation must describe how they will accelerate Gen III+ SMR deployments and support the development of the initial Gen III+ SMR orderbooks.

Each award will be made under one of two tiers within the funding identified in Table 1. All major systems used in both tiers are expected to be at a Technology Readiness Level (TRL) of 6 or higher at the start of the project as defined in DOE Guide 413.3-4A, U.S. Department of Energy Technology Readiness Assessment Guide.

Each application to this solicitation must show how the proposed project will result in or contribute to the actual construction and operation of one or more Gen III+ SMRs through plans to:

• Demonstrate favorable technical capabilities, a deployable timeline, economic impacts, and its potential for timely replicability in other facilities or sites to support follow on deployments,

• Earn and sustain the support of the local community and any federally recognized Tribal Nations,

• Support the creation and retention of domestic high-paying, stable, industrial sector jobs that will support broadly shared prosperity in the communities in which the facilities are located, and

• Contribute to energy and national security by, for example, reducing dependence on foreign products or positioning U.S. industry for long-term competitiveness.

More details on each of these requirements are provided in subsequent sections of this solicitation.

https://www.directives.doe.gov/directives-documents/400-series/0413.3-EGuide-04a-admchg1/@@images/file

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Award and Milestones Awards selected under this solicitation will be milestone-based awards. Specific project milestones for each awardee, including number and timing, will be negotiated on a project-by-project basis to produce the best possible balance between project outcomes and DOE risk exposure. Examples of factors that may be considered as part of such negotiations include project and risk management processes, team capabilities, project cost estimates, financial contingencies, community benefits commitments, and engagement of independent monitors such as Independent Engineers and/or community benefits consultants.

All milestones must address major project events and be capable of independent verification for quality and completeness. For example, a milestone for the submission of a permit or license request to the NRC is not considered acceptable because it does not include the NRC’s verification of quality or completeness;

however, a milestone for the NRC’s docketing or issuance of a permit or license is considered acceptable.

Award payments will be scheduled to occur upon the successful completion of award milestones. Notional milestones based upon anticipated activities in each tier are discussed in the sections below.

Project Continuation Between Milestones

All projects selected under this solicitation will be eligible to continue forward in the award pending the successful execution of previous milestones. DOE is not planning a competitive down-select process among projects after awards are made. If DOE determines that the project is making insufficient progress in meeting the negotiated milestones, additional scrutiny and oversight by DOE or its representatives may be employed, and corrective measures negotiated. DOE will work with the awardee to determine what data are required to evaluate whether the project should continue. This may include data regarding technological, environmental, economic, market, workforce, community benefits, and other components of the project’s activities. DOE reserves the right to discontinue an award for failure to achieve negotiated milestones.

National Environmental Policy Act (NEPA) DOE’s decision whether and how to distribute federal funds under this program is subject to NEPA (42 U.S.C.

§§ 4321 et seq.). NEPA requires federal agencies to consider the environmental effects of their proposed actions in their decision-making processes and inform and engage the public in that process. For additional background and guidance on NEPA, refer to the DOE NEPA Website, https://www.energy.gov/nepa or https://ceq.doe.gov/index.html.

While NEPA compliance is a federal agency responsibility and the agency is responsible for the accuracy, scope, and content of any environmental documents, all selectees selected for negotiation of an award will be required to assist in the timely and effective completion of the NEPA process. For projects that require environmental assessments (EAs) or environmental impact statements (EISs), sponsors will be directed to use project funds to hire a third-party NEPA contractor to prepare EA or EIS under the supervision of DOE, and DOE will independently evaluate the EA or EIS and take responsibility for the contents.

DOE has and will continue to collaborate with the NRC on all projects where DOE's funding and NRC's jurisdiction overlap. NEPA compliance activities will be tailored to each project awarded under the forthcoming funding opportunity; NEPA compliance activities should be accounted for in the project scope, https://www.energy.gov/nepa https://ceq.doe.gov/index.html

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov schedule, and budget. For additional background and guidance on NEPA refer to the DOE NEPA Website https://www.energy.gov/nepa or https://ceq.doe.gov/index.html.

National Historic Preservation Act (NHPA) DOE must comply with the requirements of Section 106 of the National Historic Preservation Act (NHPA) prior to deciding whether or how to distribute federal funds. Section 106 requires DOE to identify and consider adverse effects to historic properties that are listed in or eligible for listing in the National Register of Historic Places. DOE will perform a NHPA review under the umbrella of its NEPA review and will require applicants to assist in this review and consider impacts to historic properties.

DOE Order 144.1A American Indian Tribal Government Interactions and Policy This Policy sets forth the principles to be followed by DOE to ensure an effective implementation of a government-to-government relationship with American Indian and Alaska Native Tribal governments. The Policy is based on the United States’ Constitution, treaties, Supreme Court decisions, Executive Orders, statutes and existing federal policies, Tribal laws and the dynamic relationship between Indian nations and federal government (DOE Order 144.1: Department of Energy American Indian Tribal Government Interactions and Policy (2009)).

https://www.energy.gov/nepa https://ceq.doe.gov/index.html https://www.energy.gov/sites/default/files/DOE%20O%20144.1.pdf https://www.energy.gov/sites/default/files/DOE%20O%20144.1.pdf

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Tier 1: First Mover Team Support Tier 1, funded by section 311 (a)(1), paragraphs (A) and (B), of the CAA 2024 will fund the near-term grid-scale deployment of domestic Gen III+ SMR technologies. It will provide funding for up to two Gen III+ SMR projects that are reliable, licensable, commercially viable, financeable, and have a demonstrated path towards a multi-reactor orderbook.

The reactor designs selected for Tier 1 are expected to be technologically mature and close to a final design (i.e., at a Technology Readiness Level (TRL) of 6 or higher – see TRL scale from DOE Guide 413.3-4A, U.S. Department of Energy Technology Readiness Assessment Guide). For the purposes of this award, being in a final design state indicates that the design is sufficiently mature to begin procurement or construction activities. DOE expects that the applicant will be able to clearly exhibit that by the early 2030s it would be able to complete the appropriate permitting, certification, and licensing reviews/activities with the NRC; secure community support; provide a strategy for securing financing for the reactor project; finalize design before major construction; execute long-lead procurements; develop operational programs and complete operator training; demonstrate supply chain readiness; establish an EPC contract; construct the reactor; and perform start-up and testing to assure the Gen III+ SMR is operational and producing electrical power and/or process heat at capacity (with limited and scheduled outages). With a near-term deployment schedule in the early 2030s, a potentially successful applicant would likely need to have commenced some level of pre-application engagement with the NRC by the time of application.

The applicant should highlight if any items are needed to complete the final design or mitigate licensing or operations risks, such as:

• Modeling and simulation of the design to address potential operational and safety issues;

• Development of innovative plant safety systems;

• Prototyping and/or manufacture of major components or systems to prove the ability to design and operate innovative capabilities;

• Development of plant control and protection systems, including plant simulators and operator training programs;

• Demonstration of prototypes or sub-scale reactors, or the build-out of test facilities to demonstrate a portion of the reactor as part of an overall reactor system; and/or,

• Development of schematics, diagrams, and layouts of the plant configuration.

Projects supported by Tier 1 must be licensed by the NRC, and therefore cannot be inimical to the common defense and security or public health and safety as required by 10 CFR 50.40. The applicant must describe their approach to addressing the environmental requirements in 10 CFR 51, as well as the specific NRC licensing safety process selected, such as a construction permit and operating license under 10 CFR Part 50 or a combined license under 10 CFR Part 52. The applicant should highlight the current status, if any, on the development and submittal of applications for a design certification, early site permit, construction permit, operating license, and/or combined license, depending on the preferred licensing pathway.

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U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

Projects will be reviewed and ranked based on the level to which the following attributes are demonstrated:

• Realistic and detailed timeline for deployment;

• Teams that include legally binding agreements between a utility (or utilities), reactor vendor, end-users/off-takers (if applicable), and EPC contractor, which has evaluated constructability of design, availability of a skilled workforce, and other important factors for a successful deployment;

• Documented agreement on pursuing a Gen III+ SMR technology with a replicable design for multiple reactor deployments, domestically and / or internationally;

• Portion of the electricity, steam, or other form of power to be produced by the Gen III+ SMR(s) contracted for offtake;

• Economic competitiveness analysis of the reactor project relative to existing electric generation options;

• A strategy for financing the reactor project, including the anticipated sources of funding and a breakdown between debt and equity levels at each project stage;

• Identified mechanism(s) to manage a complex project, including strategies to manage changes to team member composition, to avoid or mitigate cost and schedule overruns, and to manage changes to offtake commitments;

• Maturity of current project cost and schedule estimates;

• Significant pre-application engagement with the NRC, a regulatory engagement plan, and/or submittal of a license application to the NRC;

• A plan for ongoing, meaningful engagement with the host community, workforce, and other stakeholders, as well as with impacted or potentially impacted Tribal Nations, that will result in the delivery of benefits in line with local priorities;

• A plan for an orderbook of multiple reactor deployments, any documented agreements on offtake or follow-on orders for subsequent deployments, and a timeline for how procurements and construction – including availability of a skilled workforce– would be navigated for each subsequent project;

• A plan for how first-of-a-kind learnings will be leveraged to facilitate cost reductions in nth-of-a-kind projects;

• Use of domestic supply chains with demonstrated capacity and capability to support planned orders as well as potential future growth, to the extent possible including total amount of goods and services to be acquired domestically versus internationally; and,

• Timeliness of the proposed deployment, including mechanisms such as use of an existing nuclear site with the potential for expansion or existing engagement with the NRC including pre-application engagement, submission of a permit or license application, and/or receipt of design certification.

DOE will weigh the financial and commercial viability of the proposed projects when ranking applications, including an applicant’s ability to complete the reactor project leveraging the Department’s existing

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov appropriations and authorizations. For details about how these factors will be considered in application review, see Application Review Information section.

Awards made under this tier may be configured in such a way to allow awardees to access financing from the Loan Programs Office (LPO) for later stages in the project, such as construction and start-up testing (see Integration with LPO section for more information). Applicants should specify how they plan to complete the project using any combination of the following:

• Additional non-federal support, such as private investment and/or state and local public incentives

• Private risk-sharing mechanisms, such as agreements among team members or insurance products

• Loans*

• Tax credit revenue

*Applicants that intend to seek LPO financing should specify how they plan to complete the project both with and without LPO financing. A viable strategy to finance the project cannot be predicated on the assumed receipt of LPO financing.

Integration with LPO LPO provides attractive debt financing for high-impact, large-scale (e.g., $100M+) energy infrastructure projects in the U.S. The office has billions of dollars in loan authority available through Title 17, Section 1703, Innovative Energy and Innovative Supply Chain, and Section 1706, the Energy Infrastructure Reinvestment Program. To qualify for 1703, energy projects must either involve innovative technologies or be paired with investments from State Energy Financing Institutions. To qualify for 1706, energy projects must retool, repower, repurpose, or replace energy infrastructure; 1706 also allows for projects that enable existing energy infrastructure to be upgraded to reduce their greenhouse gas emissions. Eligible project types include constructing new reactors. Across the supply chain, eligible project types include fabrication and nuclear component manufacturing. Note that presently, authority available under Section 1706 needs to be designated for Conditional Commitment on or before September 30, 2026, after which time the authorization expires.

Loans can be direct loans from the Federal Financing Bank (FFB) backed by a 100 percent “full faith and credit” DOE guarantee with no minimum or maximum loan size and flexible structures. The loan amount may be up to 80 percent of eligible project costs. LPO debt must be senior secured or pari passu with senior secured debt, however, LPO can consider lending unsecured to investment grade utilities that do not have the ability to issue secured debt.

For details on LPO loan pricing, visit https://www.energy.gov/lpo/articles/pricing-lpo-financing-program.

LPO engages early with applicants and remains a partner for the lifetime of the loan through a six-step process, outlined as follows:

1. Pre-Application – LPO meets with the potential applicant to discuss project eligibility, application process, and applicant questions.

https://www.energy.gov/lpo/articles/pricing-lpo-financing-program

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

2. Application and Review – This step occurs in two parts. In Part I, LPO establishes project eligibility and readiness to proceed. In Part II LPO conducts programmatic, technical, and financial evaluations.

3. Due Diligence – LPO and the applicant engage third-party advisors and negotiate a term sheet.

4. Conditional Commitment – LPO offers a term sheet for the loan guarantee. The offer is contingent on the borrower satisfying certain conditions.

5. Financial Close – LPO and the borrower execute definitive financing documents, subject to additional conditions precedent to loan disbursements.

6. LPO Monitoring – LPO monitors the project and acts as a trusted partner for the life of the loan, acting in the best interest of the U.S. Government and taxpayers.

LPO Title 17 loans are subject to a “denial of double benefit” or “federal support” restriction which prohibits the same project from receiving both federal grants and loans concurrently. Since this solicitation will use milestone-based payments with discrete activities and timing, it is feasible that the award scope of work could be clearly distinguished and separable from the scope of project activities and costs financed by a potential LPO loan. For example, a project team could receive grant funding for technology development and after that has been completed, an LPO loan could finance a specific reactor plant deployment.

However, this determination will require analysis of project specific attributes and receipt of an award, or successful completion of milestones has no bearing on eligibility for, or issuance of, LPO financing.

Tier 1 Award and Potential Milestones Milestones selected for Tier 1 should be a subset of, or all of, the significant events that occur during the design, licensing, and/or construction phase of deploying a Gen III+ SMR. Applicants should define the milestones for which they seek award, which notionally may include:

• Reactor technology design selection, if necessary;

• Completion of preliminary reactor design;

• Completion of important project planning and guidance documents, such as project management plans or quality assurance plans;

• Completion of Association for the Advancement of Cost Engineering (AACE) Class Project Cost Estimates as verified for accuracy and quality by an Independent Cost Review (ICR);

• Docketing of license applications by the NRC;

• Completion of a community engagement plan with tangible outcomes, such as negotiating community benefits agreements tailored to the host community;

• Formalization of legally binding workforce agreements, such as project labor agreements8 or community workforce agreements;

• Site selection and completion of subsequent site characterization activities;

8 A project labor agreement is a pre-hire collective bargaining agreement consistent with section 8(f) of the National Labor Relations Act (29 U.S.C.

158(f)).

U.S. Department of Energy | Office of Clean Energy Demonstrations & Office of Nuclear Energy | energy.gov

• Establishment of a binding agreement among team members on how the private sector will navigate the potential for cost overrun risk;

• Completion of DOE and NRC required…