Rolls-Royce Chosen Over GE Vernova as Sweden’s SMR Supplier, a Strategic Bet on Strengthening Europe’s Energy Security?

Sweden’s state-owned Vattenfall to source SMRs from the U.K.’s Rolls-Royce
GE Vernova entered the competition as an established operator with extensive experience and technological capabilities
Rolls-Royce, despite lacking commercial operating experience, benefits from Europe-first momentum

Sweden’s state-owned utility Vattenfall has selected Britain’s Rolls-Royce as the supplier for its next-generation small modular reactor (SMR) program. The decision handed the contract to Rolls-Royce despite the company’s lack of practical experience in commercial nuclear plant construction and operation, while sidelining U.S.-based GE Vernova, a proven industry player. The move is widely viewed as reflecting the growing emphasis among European nations on strengthening energy security.

Conclusion of Sweden’s SMR Competition

Bloomberg reported on June 15 that Rolls-Royce had defeated GE Vernova to become Vattenfall’s preferred supplier for its next-generation SMR project. Vattenfall had previously announced in August last year that its subsidiary Videberg Kraft was evaluating either five GE Vernova BWRX-300 reactors or three Rolls-Royce SMRs, with each option providing nearly 1,500 megawatts (MW) of total generating capacity. Videberg Kraft is a nuclear project company owned 80% by Vattenfall, with the remaining 20% held by major Swedish corporations.

Under the agreement, Rolls-Royce will undertake a major project involving the simultaneous construction of three reactors, each with a design capacity of approximately 470MW, at the existing Ringhals nuclear power site in southwestern Sweden. Explaining the selection, Vattenfall Chief Executive Officer Anna Borg stated that “the Rolls-Royce SMR proposal was superior in terms of supply chain readiness, construction schedule, and profitability.” She added, “The supply chain for key nuclear components is already well established, and most suppliers are geographically close to Sweden. This reduces the risk of transportation disruptions and lowers exposure to geopolitical shocks.”

The project marks Sweden’s first new nuclear power development in more than four decades. Sweden pursued a gradual nuclear phaseout policy following a 1980 referendum, but reversed course after the outbreak of the Ukraine war in February 2022. More recently, the Swedish government has proposed incentives including loan support worth up to approximately $47.1 billion, 40-year electricity price guarantees, and assistance with nuclear waste management as part of a broader plan to build at least 5,000MW of new nuclear generating capacity. Sweden currently operates six reactors, which supply roughly one-third of the country’s electricity.

GE Vernova’s Established Position

Markets have focused on Vattenfall’s decision to choose Rolls-Royce over GE Vernova. From the perspective of construction experience and technological capability, many viewed GE Vernova as the safer option. Although GE Vernova itself was established in 2024, it emerged from GE’s power business, which carries more than 130 years of history. The company was formed through the integration of GE Power, GE Renewable Energy, GE Digital, and GE Energy Financial Services. Today, GE Vernova is regarded as one of the world’s largest energy equipment providers, with businesses spanning gas turbines, nuclear power, hydropower, wind energy, and grid equipment. It is also recognized as a proven operator with extensive EPC capabilities and a global service network.

The company has also established a significant presence in the SMR market. A notable example came in February, when it signed a contract with Orlen Synthos Green Energy (OSGE), a joint venture between Polish state-controlled energy company Orlen and chemicals producer Synthos, to develop a European design adaptation of the BWRX-300 SMR model. Valued at more than $100 million, the contract focuses on designing a Poland-specific SMR optimized for the country’s regulatory framework and energy market conditions. The BWRX-300 simplifies conventional large-scale boiling water reactor (BWR) technology into a smaller format and is widely regarded as one of the fastest-moving SMR designs toward commercialization globally.

In addition, GE Vernova formally signed a memorandum of understanding (MOU) with Japan’s Hitachi in March to advance SMR deployment across Southeast Asia. The initiative aims to target regional markets with SMRs, which require lower upfront capital investment than conventional large-scale nuclear plants, while accounting for Southeast Asia’s geographic and economic characteristics. The Philippines and Indonesia are currently viewed as the most active prospective adopters of SMR technology in the region. The Philippines has identified SMRs as a potential game changer for addressing surging electricity prices and recurring power outages, while Indonesia is evaluating SMRs as a suitable solution for distributed power generation across its archipelago of more than 17,000 islands.

Rolls-Royce’s SMR Business Only Beginning to Gain Traction

By contrast, Rolls-Royce has never built or operated a commercial nuclear power plant. The company spent decades supplying reactors for British naval nuclear submarines before entering the civilian nuclear sector in the late 2010s. In alignment with the U.K. government’s SMR initiative, Rolls-Royce assembled a development team of roughly 150 specialists and began designing a light-water-reactor-based SMR. The project gained momentum in 2017 after securing up to approximately $75.3 million in government research and development funding. Additional rounds of support between 2019 and 2021 transformed the initiative into a full-scale commercialization effort.

Commercial deployment, however, remains unfinished. Rolls-Royce SMR entered the U.K. Office for Nuclear Regulation’s Generic Design Assessment (GDA) process in 2022 and is still progressing through licensing procedures. Not a single reactor has entered commercial operation. Nevertheless, following a national SMR competition that lasted roughly two years, the British government selected Rolls-Royce as the preferred developer last year and designated the project as “the United Kingdom’s first SMR construction program.” The proposed site is Wylfa in Wales, where up to three Rolls-Royce SMRs are expected to be built.

Most of the project’s financing comes from the government. London allocated approximately $3.37 billion to the initiative last year and committed an additional $806.7 million this year through the National Wealth Fund (NWF). This level of public support reflects the fact that Rolls-Royce SMR has yet to demonstrate independent commercial viability. Once completed, the project is expected to provide at least 1,400MW of electricity to roughly three million households for more than 60 years. However, with the final investment decision (FID) not expected until around 2029, actual construction and commercial operation remain several years away.

Industry experts point to energy security as the primary factor behind Vattenfall’s decision to choose the less experienced Rolls-Royce. One market specialist noted, “If evaluated purely on technological capability and project experience, a U.S. company such as GE Vernova might have represented the more straightforward choice. However, with European countries increasingly prioritizing energy security and supply-chain autonomy, Sweden may have assigned greater value to a European company capable of strengthening regional technology capabilities and industrial ecosystems.”