As oil prices climb due to geopolitical strife, sending the cost of operating containerships soaring, a recent industry report is touting the benefits of nuclear-powered vessels.

Nuclear propulsion could save up to $68 million in annual operating costs per container vessel, while eliminating a significant amount of greenhouse gas emissions, according to the report by Lloyd’s Register and LucidCatalyst, issued late last year by Seaspan Corporation Pte. Ltd., an independent containership operator and charter owner.

Savings estimated by the report include $50 million in bunker fuel costs and $18 million of avoided carbon penalties. In addition, the report’s authors assert, a nuclear-powered containership of 15,000 twenty-foot equivalent units (TEUs) would be 39% faster and provide up to 38% more capacity than conventional vessels, due to the removal of oil-based fuel tanks and systems.

Key to the success of such a model would be adoption of small modular reactors (SMRs), which proponents say are quicker and cheaper to build than traditional nuclear plants. Peter Jackson, chief technology officer at Seaspan, called SMRs “a very exciting technology offering several desirable benefits for shipowners and operators.”

James Walker, chief executive officer of NANO Nuclear Energy, Inc., says the design work for SMRs is done, and that the technology is ready to proceed to the demonstration phase. NANO plans to build what Walker says will be the United States’ first small-scale microreactor system, on the campus of the University of Illinois Urbana-Champaign.

A second SMR is slated for construction in Canada, at Chalk River Laboratories in Ontario, although that project was delayed when the parent of project sponsor Global First Power filed for Chapter 11 bankruptcy protection in October of 2024. NANO subsequently acquired the company.

Yet another SMR initiative is underway by Kairos Power LLC, which plans construction of a demonstration reactor in Oak Ridge, Tennessee (notably, one of the key sites of the Manhattan Project), targeting completion in 2028.

NANO’s design is for a high-temperature gas reactor running on tri-structural isotropic particle (TRISO) fuel, which consists of enriched uranium kernels that can tolerate extreme heat without melting. That rules out the possibility of the worst accident scenario envisioned with conventional reactors, Walker says.

“You don’t want to do a scaled-down conventional [light-water] reactor system,” he says, adding that the necessary safety measures for a large reactor “would kill the economics.”

What’s more, Walker says, traditional reactors are hampered by long construction delays, cost overruns and the inability to mass-manufacture components.

NANO’s timeline for its land-based SMRs calls for completion of initial construction in 2028-2029, and licensing in 2030. Due to the need to modify the reactors for maritime use, they wouldn’t become commercially available for installation in containerships until 2032 or 2033 at the earliest.

NANO is currently in discussions with shipping companies about adopting the technology. “They’re very happy to work with us,” Walker says, citing the benefits of reduced weight and energy consumption, and elimination of the need to dock for fuel. According to the Seaspan report, a nuclear-propelled ship could operate for approximately five years between refuelings.

In theory, today’s oil-burning containerships could be modified to accommodate nuclear propulsion, but Walker suspects it will be easier to incorporate the reactors into newbuilds, because existing vessels wouldn’t have to be taken out of service for the refit.

For all of its vaunted advantages, nuclear propulsion for container shipping won’t succeed without a cross-industry consortium that develops “a rigorous, requirements-led supply chain and procurement strategy,” the Seaspan report says. With industry pledging to purchase more than 1,000 units in 10-15 years, it adds, modular reactors could be produced at the cost of $750 to $1,000 per kilowatt, “significantly cheaper than conventional nuclear power plants, and maintained within standard vessel drydock cycles.”

Additional obstacles include the need to revamp port infrastructure, obtain adequate supplies of uranium, compete with tech companies and public utilities for limited reactor production capacity, and meet extensive regulatory requirements imposed by multiple countries. A research report published last fall by Lloyd’s Register offers guidance on how to surmount at least some of those hurdles, especially in the areas of safety, security and commercial liability.

“Naturally, there are challenges to overcome,” Jackson said at the release of the Seaspan report, “but I am confident that ongoing work in this area and studies like this will soon allow nuclear-powered containerships to be operating safely, economically and emission-free.”