Three Arizona utilities have teamed up to apply for a federal grant to explore building small modular reactors, or SMRs, in the state. Arizona Public Service, Salt River Project, and Tucson Electric Power submitted a joint application to the U.S. Department of Energy. The grant would fund a three-year process to find possible sites and begin early planning.
Three Arizona utilities are joining forces to pursue federal funding for small modular reactor development in the state.
The DOE grant is part of a broader federal program to speed up SMR development across the country. Similar awards have already gone to TVA and Holtec for projects in Tennessee and Michigan, with funding reaching hundreds of millions for those efforts. Arizona’s utilities aren’t trying to be first in the nation. They’re targeting deployment in the 2040s.
SMRs are smaller than traditional nuclear plants. They produce between 50 and 300 megawatts of power. A 300-megawatt SMR can power approximately 300,000 homes. Their smaller size makes them cheaper and faster to build than full-scale nuclear plants. There are reportedly 74 SMR projects in development worldwide, with two already operating in Russia and China.
APS serves 1.4 million homes and businesses across 11 Arizona counties. All three utilities have committed to 100% clean power by 2050. Nuclear already plays a role in that goal. Arizona’s Palo Verde Generating Station is the largest nuclear plant in the U.S. and has been running since the late 1980s. It’s part of the current energy mix, which is 54% clean. Unlike wind and solar, nuclear energy provides continuous zero-carbon electricity regardless of weather conditions, making it a critical component of a reliable clean energy grid.
Arizona lawmakers have also shown interest in SMRs. Six Republican bills have been introduced to make it easier to build them. The bills would prevent counties from banning SMRs and allow them to be built near data centers. They’d also let SMRs replace coal or gas plants without extra regulatory review. Rep. Justin Wilmeth introduced two of those bills specifically aimed at accelerating SMR construction in the state.
Not everyone supports the push. Critics point to high costs, the experimental nature of the technology, and environmental risks. The County Supervisors Association opposes bills that would limit local authority over siting decisions. The Arizona Corporation Commission held a workshop last week to better understand what it takes to finance nuclear generation projects. No specific locations or manufacturers have been chosen yet, and actual deployment is still likely many years away.
References
- https://shalemag.com/small-modular-reactor-funding/
- https://azcapitoltimes.com/news/2026/02/19/republicans-look-to-speed-up-small-modular-nuclear-reactor-construction-in-arizona/
- https://www.kjzz.org/business/2026-03-02/arizona-utilities-say-they-wont-be-1st-in-the-u-s-to-build-new-nuclear-power-plants
- https://sightlineu3o8.com/2026/02/new-nuclear-projects-see-bipartisan-support-in-arizona/
- https://nucleationcapital.com/us-states-nuclear-initiatives
- https://www.youtube.com/watch?v=s1OD1xxaWl8
- https://www.aps.com/en/About/Our-Company/Newsroom/Articles/AZ_Electric_Utilities_Team_Up_To_Explore_Adding_Nuclear_Generation
- https://www.energy.gov/ne/generation-iii-small-modular-reactor-program
