As Appalachian Power continues to look at a Campbell County location for a potential small modular nuclear reactor, state regulators have approved the utility’s decision to incur costs associated with evaluating and developing the site, a step toward eventually charging customers for at least some of those costs.
Appalachian Power has not decided whether it plans to pursue building a small modular reactor, or SMR. If it chooses to do so and secures the necessary approvals, the reactor likely would not come online until the mid- to late 2030s, the company has said.
Appalachian has not asked regulators to begin recovering site development costs. The State Corporation Commission’s order Wednesday approves Appalachian’s decision to spend money on site development, which allows the utility to seek cost recovery later. The utility has said it anticipates making that request in mid-2026.
Appalachian Power anticipates site development costs will total $122 million. A state law passed in 2024 allows the utility to seek regulatory permission to charge customers for those costs and caps the amount that the utility could recover at $125 million total over five years.
If Appalachian Power ultimately recovers the maximum amount allowed by state law and amortizes it over five years, the average residential customer would pay an estimated additional $2.10 per month, according to testimony filed in the regulatory proceeding. Lower costs or a different amortization schedule would change that monthly amount.
Appalachian Power has said it is seeking support from the U.S. Department of Energy to reduce how much expense it would pass on to customers.
Appalachian Power said in a statement to Cardinal News that the SCC’s decision marks “a significant step forward in our commitment to bringing innovative energy solutions that align with our sustainability goals to Virginia.”
“We are dedicated to engaging with our stakeholders throughout this process and will continue to prioritize safety, environmental stewardship, and community input as we move forward,” the company said.
Small modular reactors, or SMRs, are designed to provide 24/7 power while being smaller than traditional nuclear reactors — for example, rated at 300 megawatts of power generation compared to around 1,000 for a larger reactor such as those at Dominion Energy’s North Anna nuclear plant.
[Disclosure: Dominion is one of our donors, but donors have no say in news decisions; see our policy.]
Commercial development of SMR technology is relatively new. No U.S. electric utility has deployed an SMR, but some utilities, including the Tennessee Valley Authority, plan to. Dominion has expressed interest in possibly building an SMR at its North Anna plant.
It’s possible that Appalachian Power customers end up paying site development costs for an SMR that is never built, a point raised by SCC staff during the regulatory proceeding.
Appalachian’s steps toward possibly developing an SMR come as it faces a state-mandated deadline to achieve a carbon-free energy portfolio by 2050 under the Virginia Clean Economy Act.
Appalachian Power has about 540,000 customers in Western Virginia.
The utility’s electricity demand has been generally flat in recent years, but it anticipates that future load growth from large industrial or commercial customers such as data centers could require more power, according to testimony at an Oct. 9 hearing before the SCC.
Appalachian Power has said its Campbell County property at Joshua Falls, along the James River, a few miles outside Lynchburg, has the necessary existing infrastructure to support an SMR, including a 765-kilovolt electric substation and roads that can handle moving equipment.
The company had spent $13.5 million as of the end of August and anticipates spending $34 million altogether by the end of this year on site development and evaluation activities, according to testimony at the Oct. 9 hearing.
Such activities include analyzing the property for its suitability for an SMR, applying for permitting and licensing from the federal Nuclear Regulatory Commission and public outreach, such as an open house information session held in December at the Lynchburg Regional Business Alliance.
Correction, Nov. 14: A previous version of this story’s headline incorrectly stated that Appalachian Power received approval to recover SMR site costs. The utility has received approval to incur those costs and plans to seek permission to recover them later.