In a beautiful liberty-style villa in the centre of Turin, more than 100 physicists and engineers are designing a next-generation nuclear reactor that aims to take on the industry’s critics. It’s a surprising location for a nuclear research and development (R&D) hub. Yet, from its base in northern Italy, Newcleo is leading the push towards small modular reactors as a safer, cheaper and cleaner alternative to traditional nuclear power. 

Newcleo commenced operations in September 2021, but its origins stem back to the early 1990s when its co-founder and CEO, Stefano Buono, began researching a safer version of traditional nuclear power. “The Chernobyl accident had just occurred and people were worried about the safety of nuclear reactors,” he says. 

Two key principles from his work over the past three decades are embedded in Newcleo’s technology. First, its reactors use liquid lead as coolant, rather than water like traditional reactors, as it uses fuel more efficiently and enhances safety during an accident. Second, the reactors use reprocessed nuclear waste as their fuel. Traditional reactors only burn up to 10% of their fuel. “We want to burn 100%”, says Mr Buono. “The fact that today’s reactors are not properly using the rest makes the amount of nuclear waste 200 times more than what it could be.”

Newcleo’s reactors also have cost and speed advantages over those operating today. Its 200 megawatt (MW) reactors will cost €800m to build over three years, with an installation cost equal to €4 per watt-electric (a measure of electrical output from a generator). That compares to today’s reactors that take up to a decade to be built and, according to 2020 estimates by the Nuclear Energy Agency, cost up to €6.30 per watt-electric to install.

Choosing France

Two years after it launched, the firm already straddles three countries. Its R&D activities are in Italy, it is building a 30MW test reactor in France by 2030, and it is headquartered in the UK — where it plans to deploy its first 200MW commercial unit by 2032. In recent months, however, its focus has firmly been on France, following its commitment in May to invest €3bn in the country by the end of the decade. 

This marks a change of course from its initial strategy to build its first reactors in the UK. The country’s two changes of government during 2022 “really froze … the possibility of establishing a good strategy in the UK as [the government’s nuclear policy] was delayed”, says Mr Buono. The launch of the Great British Nuclear body, announced in April 2023, continues to be pushed back.

“We preferred to develop our first reactor … in a country that was pushing to do things faster and effectively,” he says. “We were very surprised about the efficiency of the French system in supporting us.” 

To date, that support has included the national 30% research tax credit that Mr Buono describes as “an almost automatic co-investment” by the government, and €15m in grants under the France 2030 investment plan. He says the government is also considering providing land for Newcleo’s first reactor, which is “another sign of great support”.

Newcleo is already mulling its European expansion as it looks to build a regional supply chain. Mr Buono cites Belgium as a country of interest given its work with lead-cooled reactors. Italy, on the other hand, is destined to remain an R&D hub for as long as the national nuclear ban remains in place. 

The firm’s prospects received an extra boost in March thanks to Italian energy giant Enel’s commitment to provide technical support in exchange for the right to invest in its first reactors. On top of nuclear’s inclusion in the EU’s green taxonomy, Mr Buono points to the pact with Enel — the world’s biggest foreign investor in renewables according to fDi Markets — as validating Newcleo’s sustainability credentials. “The fact that a company like that analyses a new technology and decides that it supports the green transition is amazing.”

This article first appeared in the August/September 2023 print edition of fDi Intelligence