Nuclear Minister Andrew Bowie said: “As the Government that revitalised the UK nuclear industry, committing public funds to nuclear for the first time in a generation, we’re rapidly expanding our nuclear power capacity to move towards a cleaner energy mix and help deliver net zero.”

Holtec and Rolls-Royce are up against French state-owned power producer EDF, US designer NuScale Power, Westinghouse Electric Company and GE-Hitachi in bidding for SMR orders from the UK.

NuScale, which already has design approval in the US for its model, was dealt a blow last month when its maiden deal to build six plants in Utah collapsed.

Depending on its size and design, the price of an SMR could start at $100m, rather than the tens of billions that traditional nuclear power stations cost.

Hinkley Point C in Somerset was estimated to cost around £26bn in 2015, for example, but could now end up costing £33bn, according to latest estimates.

Tom Greatrex, chief executive of the Nuclear Industry Association, said: “This funding shows the UK is committed to its new nuclear programme which needs to be rolled out at pace and at scale to ensure we ramp up nuclear so we can deliver clean power for net zero and good, green jobs for our communities.