Rolls-Royce & Great British Energy: Reshaping Infrastructure

Following nearly a year of negotiations, the contract has been finalised. Great British Energy and Rolls-Royce SMR have entered into a formal agreement that advances the UK's small modular reactor (SMR) programme. The initiative, supported by US$3.3bn in public funding, could reshape Britain's energy infrastructure for generations.

The contract, confirmed on 13 April 2025, follows Rolls-Royce SMR's appointment as preferred technology partner in June 2025. The agreement enables site-specific design work, regulatory engagement and planning processes to commence ahead of a future Final Investment Decision.

The agreement requires Rolls-Royce SMR to deliver three reactor units that will generate at least 1.4GW of electricity. According to the company, this capacity could power approximately 3 million homes for over 60 years. The project could support 3,000 construction jobs, with additional employment opportunities expected across the domestic supply chain.

The programme's funding structure draws from multiple sources. Great British Energy's nuclear branch is utilising the US$3.3bn allocated during the 2024 Spending Review, while the National Wealth Fund is committing up to US$760m directly to Rolls-Royce SMR to support technology development and strengthen investor confidence.

"This contract unlocks the delivery of our first three units and brings certainty to the UK SMR programme," says Chris Cholerton, CEO of Rolls-Royce SMR.

"We are transforming the way nuclear projects are delivered, to give greater cost and schedule certainty with a standardised, factory-built approach."

Factory-built nuclear technology

The potential advantage of SMRs compared to traditional large-scale nuclear plants lies in their modular construction approach. Components are factory-built and assembled on site, which could reduce both cost overruns and construction delays that have historically disrupted nuclear projects.

Whether this approach proves effective at scale remains to be demonstrated, but the government appears confident in the strategy. Great British Energy – Nuclear (GBE-N) has already awarded over US$445m in supply chain contracts in 2025, suggesting the programme could be progressing more rapidly than official communications indicate.

Simon Roddy, CEO of GBE-N, believes the project could deliver substantial benefits to the UK economy and energy sector.

"Working with Rolls-Royce SMR, we're bringing a significant long-term investment to the UK industrial supply chain," he says.

"Supporting skills, innovation and growing our industrial capability is essential to this partnership."

Energy security considerations

Energy Secretary Ed Miliband has connected the announcement to current instability in global energy markets. "At a time of global instability, this is a major milestone for Britain's energy security," he says, noting that the project would create "a generation of good jobs" and deliver "clean, homegrown power for decades to come".

GBE-N's announcement referenced the ongoing conflict in the Middle East as a reminder of the risks associated with fossil fuel dependency, reflecting the political pressure driving the clean energy agenda alongside commercial considerations.

European expansion plans

For Rolls-Royce SMR, the British contract is not the only significant project under development. Chris notes that the company already has plans for up to six further units in Czechia, making it, in his words, "the only company with multiple commitments in Europe".

This European dimension could prove significant for the programme's economics, as a larger order book makes the factory-built model more viable and helps distribute development costs across multiple projects rather than concentrating risk on a single deployment.

Whether this pipeline materialises will depend on factors beyond Whitehall's control, but the UK contract provides a commercial foundation that could give the wider programme credibility with future customers and investors.