US nuclear company Holtec has chosen South Yorkshire as the planned location for a £1.5bn (€1.7bn, $1.9bn) small modular reactor factory that will also serve potential export markets in Europe and the Middle East.

Holtec said the factory will create thousands of highly skilled and high-paying jobs.

The South Yorkshire site was chosen from 13 potential locations around the UK following “a robust and highly competitive process”. Four locations – West Midlands, Cumbria, Tees Valley and South Yorkshire – were shortlisted

Holtec Britain – a subsidiary of Holtec International – has been working at Sizewell B nuclear power station in Suffolk, southeast England, for more than 15 years and has been in the UK for nearly 30 years.

The company said the SMR factory in South Yorkshire would see at least 70% of materials, components and work carried out in the UK.

It added that £50m would be invested in UK skills and training through its SMR Learning Academy.

Holtec said it was working to finalise its factory business plan to support its final investment decision, which will be based on its UK and international order book.

Holtec has been developing its SMR-300 unit at its technology campus in Camden, New Jersey, since 2011.

The plant is a pressurised water reactor producing around 300 MW of carbon-free power. It can also provide thermal energy for use in industrial processes, residential and commercial heating, desalination, or clean hydrogen generation.

The reactor itself will be placed underground, protecting it from extreme weather events and other threats, and will be designed to passively cool during shutdown without the need of external power or human intervention for enhanced safety.

The SMR-300, which recently completed Step 1 of the UK’s generic design assessment process, is one of six SMR designs shortlisted in October last year by state body Great British Nuclear for the UK’s SMR selection competition and one of the five vendors to submit a bid by the 8 July deadline.

The aim is for a final investment decision on two or three of the designs to be taken in 2029.

Holtec proposes to deploy around 5 GW of SMRs in serial production in the UK by 2050.

Earlier this year Rolls-Royce SMR chose Sheffield in South Yorkshire as the home for a facility to manufacture and test prototype modules for its SMRs.