(Reuters) - Chemical firm Dow and X-energy Reactor Company have submitted a construction permit application to the Nuclear Regulatory Commission (NRC) for a proposed nuclear project in Seadrift, Texas, the companies said on Monday.

WHY IS IT IMPORTANT

The U.S. nuclear industry, which has faced expansion challenges in recent decades, is witnessing a surge in demand on the back of power-intensive data centers and the growing shift towards alternative, low-emission energy sources.

Companies have started adopting small modular reactors (SMR) which are more compact and cost-effective compared to full-sized reactors that often take decades to build.

The companies said the project is supported by the U.S. Department of Energy's (DOE) Advanced Reactor Demonstration Program (ARDP), which aims to accelerate the deployment of advanced reactors through cost-shared partnerships with U.S. industry.

CONTEXT

Dow's proposed advanced SMR project, developed by its unit Long Mott Energy, aims to provide clean power and industrial steam to Dow's UCC1 Seadrift operations manufacturing, replacing its existing energy and steam assets.

Dow's Seadrift site manufactures more than 4 billion pounds of materials per year used across a wide variety of applications including food packaging, preservation and footwear, among others.

The companies said the project could begin construction later this decade and start up early next decade, with the permit approval taking up to 30 months.