Small nuclear-powered modular reactors could be “crucial” in decarbonising the energy system, according to the latest report from the Policy Exchange think tank.

The paper said that solar and wind alone could not be used to meet the increased demand from electric vehicles and increased electrification of the heat and transport sectors.

Building battery storage to support renewables could cost as much as £1 trillion, the report said.

It added that importing electricity through interconnectors would become impractical because countries in Western Europe would also be switching to solar and wind.

‘Unthinkable levels’

Matt Rooney, Policy Exchange’s Energy and Environment Research Fellow, who wrote the report, said: “In the next decades, we are going to need previously unthinkable levels of new low-carbon electricity capacity for charging electric vehicles and to replace coal and gas.

“There is no other low carbon energy which can match nuclear power for scale and reliability, as well as the potential to use it for other services like district heat and hydrogen production.

“The failure of the nuclear industry to prove that it can finance and build large reactors on time and to budget means that the development of small modular reactors must be one of the central goals of government energy policy.”

> Download the report