Small Modular Nuclear Reactors and Virginia’s “All of the Above” Energy Strategy
In Virginia, as the demand for data centers continues to surge, the Commonwealth finds itself at a crossroads of innovation and necessity. Governor Glenn Youngkin’s “all of the above” energy strategy includes the potential integration of small modular nuclear reactors (SMRs) into Virginia’s energy landscape.
 
Governor Youngkin has described the race to establish SMRs as “Virginia’s version of the moonshot.” This ambitious goal is driven by a position that building wind farms and solar facilities will not be enough to meet the growing energy demands, driven by data centers. “We can’t build enough wind. We can’t build enough solar, in order to power the Virginia of the future,” Youngkin stated. To support this initiative, new legislation was passed in the last General Assembly session to encourage SMR development. The law allows Dominion Energy to petition the State Corporation Commission at any time for the approval of a rate adjustment clause for the recovery of SMR project development costs for up to one SMR facility, with a potential monthly rider capped at $1.40. The bill has an expiration date of December 31, 2029.
 
However, it’s important to note that while the push for SMRs seems to be gaining momentum—and generates significant press coverage—significant challenges lie ahead. The technology is still in its nascent stages, with only China and Russia currently operating commercial SMR facilities. The recent scrapping of a planned SMR facility in Utah due to soaring costs serves as a reminder of the potential hurdles in bringing this technology to fruition. If Virginia continues to push in this direction, careful consideration of costs, regulatory approval processes, and technological readiness will be crucial to turning this “moonshot” into reality.
 
The Surry Green Energy Center Project
Dominion Energy recently announced plans to explore the feasibility of building an SMR at its North Anna Power Station, and another project is taking shape in Surry County: the Surry Green Energy Center, proposed by Middleburg-based Green Energy Partners (GEP).
 
This project, which obtained land use approvals from Surry County in February 2023, aims to create a unique synergy between data centers and advanced energy production. The plan calls for the development of 19 data centers spread across a 3-million-square-foot campus on a 641-acre site adjacent to the existing Surry Nuclear Power Plant. The long-term vision is to power these data centers with a combination of SMRs and hydrogen fuel.
 
Initially, as proposed, the data centers in the Surry Green Energy Center will draw power from existing grid resources. The plan is for the revenue generated from these operations will then be reinvested to develop the SMRs on site. GEP envisions installing four to six SMRs, each capable of generating up to 250MW of power (the equivalent of two large solar farms). These reactors, along with the proposed hydrogen production facilities, are intended to not only power the data centers but also provide a backup energy source for Virginia’s grid.
 
However, the SMR aspect of this project is speculative, and could be described as a long-term goal rather than a certain reality. The development of these reactors is not expected to materialize for 10 to 15 years, highlighting the fact that a large gap exists between immediate data center needs and energy production that may occur using as-yet unproven technologies.
 
GEP’s Surry Green Energy Center plan swings for the fences in seeking to inject 1.5 GW of electrical energy into the grid while at the same time responsibly developing data centers. In a way, it is the embodiment of what Governor Youngkin has proposed – an ambitious plan to align immediate economic development with long-term energy innovation. As this project moves forward, it will undoubtedly serve as a closely watched case study for similar initiatives across the state and beyond.
 
A Balanced Approach for Virginia’s Energy Future
Regardless of how many speculative SMR projects get highlighted in media headlines over the next several years, the path forward for Virginia’s energy landscape involves a delicate balance of innovation, practicality, and sustainability. As highlighted in a piece I recently wrote for the Virginia Mercury, a holistic approach that embraces diverse energy sources is crucial for meeting the state’s growing energy demands, particularly from the burgeoning data center industry.
 
Here are some key points:
 

1. Diversified Energy Mix: Virginia’s future lies in a combination of solar energy, wind, hydropower, and fossil fuels in the near term—and, yes, SMRs. This “all of the above” strategy—to borrow Governor Youngkin’s term— recognizes that no single solution can address all of the state’s energy needs.
2. Cost Considerations: While SMRs show promise, their high costs compared to solar energy cannot be ignored. According to a Lazard analysis, solar energy with storage is projected to be less than half the cost of electricity from new nuclear plants.
3. Timeline Challenges: The deployment of SMRs faces significant regulatory hurdles and could take longer than anticipated, potentially extending beyond a 20-year timeframe. This delay underscores the need for immediate investment in more readily available clean energy sources like solar.
4. Gradual Transition: While the goal is to reduce reliance on fossil fuels and decrease the state’s carbon footprint, this transition will necessarily be gradual given Virginia’s immense energy needs.

 
In essence, Virginia’s energy future doesn’t hinge on an either/or choice between SMRs and solar—or any other energy source—but rather on a comprehensive approach that leverages the strengths of various sources. This balanced strategy will help ensure energy security, promote economic growth, and gradually transition towards a more sustainable energy landscape.