Speaker 1: This is Tom Rowland's Reese and you're listening to Switched
Speaker 1: on the BNF podcast. Today we're discussing the revival of
Speaker 1: nuclear power in the United States, driven by the demand
Speaker 1: of hyperscaling tech giants led by the boom in AI.
Speaker 1: The rapid growth of energy hungry data centers has resulted
Speaker 1: in an ever increasing outlook for electricity demand, which the
Speaker 1: US Energy Information Administration forecasts at three percent growth for
Speaker 1: twenty twenty four alone. With the need for a secure
Speaker 1: twenty four hour energy supply, nuclear power fits the bill.
Speaker 1: The nuclear path isn't as straightforward as it would seem, however,
Speaker 1: Small modular reactors or SMRs are still in a development phase,
Speaker 1: Regulatory hurdles remain in place, and cost concerns coupled with
Speaker 1: project overruns have been a persistent problem. Regardless, the need
Speaker 1: to secure energy to power their ever expanding data center
Speaker 1: fleet has led to companies such as Amazon, Google, and
Speaker 1: Microsoft to announce a flurry of deals with nuclear energy companies.
Speaker 1: To discuss the details of this nuclear revival further, Today,
Speaker 1: I'm joined by BNFEED nuclear analyst Kris Kodomski to review
Speaker 1: findings from his recent report Hyperscaler's Energy Appetite boosts Nuclear Prospects.
Speaker 1: Bn F clients were able to access this and other
Speaker 1: related research at BNF go on the Bloomberg Terminal and
Speaker 1: at BF dot com. Now let's talk to Chris about
Speaker 1: data centers and nuclear energy. Chris, lovely to have you here.
Speaker 1: Thank you for joining us. It's great to be back.
Speaker 1: You have been covering the nuclear industry at BNF for
Speaker 1: a number of years. Were you covering it before BNF
Speaker 1: as well? You've been at the company longer than I have, so.
Speaker 2: Yes, I was. As a matter of fact, I was
Speaker 2: first intrigued by the nuclear industry by doing studies following
Speaker 2: the collapse of the former Soviet Union and understanding what
Speaker 2: market opportunities existed in the power sector in those countries
Speaker 2: that were affected, Poland, Slovakia, Czech Republic and in Hungary.
Speaker 2: And then I went into the yucka mountain repositor that
Speaker 2: was being built or had been built in Nevada, and
Speaker 2: we had spent six billion dollars to do that and
Speaker 2: we weren't going to use it. So I kind of intrigued,
Speaker 2: why would we spend six billion dollars being in nuclear
Speaker 2: repository and not use it. So that's what really got
Speaker 2: me intrigued.
Speaker 1: I mean, the reason I asked this question, you know,
Speaker 1: how long you've been covering nuclear is I am imagining
Speaker 1: that you have seen nuclear come in and out of
Speaker 1: fashion in the sort of both the public and government
Speaker 1: and private domain. You know, kind of being cool and uncool,
Speaker 1: and then maybe cool again and then sort of in
Speaker 1: some form uncool. In terms of the sort of that cycle,
Speaker 1: where do you see nuclear right now? You know, both
Speaker 1: in terms of how it's perceived and in terms of
Speaker 1: what the state of the actual global nuclear fleet is
Speaker 1: right now.
Speaker 2: First of all, we need to understand that the nuclear
Speaker 2: industry moves like molasses, and it's that quick moving. It
Speaker 2: just goes very very steadily forward or backwards. What has
Speaker 2: happened in the last twenty four months or so is
Speaker 2: that there is a tremendous interest in nuclear power for
Speaker 2: two reasons. The first reason is for trying to address
Speaker 2: unresolved issues with regards to climate change. It's a very
Speaker 2: strong and powerful technology, and I think the world is
Speaker 2: starting to recognize that it is something that we need
Speaker 2: as part of a portfolio of technologies to solve climate change.
Speaker 2: But what really pushed nuclear forward recently has been the
Speaker 2: Russian event in the Ukraine, when all of a sudden
Speaker 2: energy security has become a very very high priority for
Speaker 2: countries in Europe, in the United States, and realizing that
Speaker 2: nuclear does provide a tremendous sense of security and it's
Speaker 2: not intermittent, and it's a very very powerful technology that
Speaker 2: should be part of the equation for climate change and
Speaker 2: for national security. Got it.
Speaker 1: And then I suppose to that point about climate that
Speaker 1: manifested itself twenty eight, which was in Dubai with this
Speaker 1: tripling nuclear pledge, which I mean, I know you've written about,
Speaker 1: and I think that your view is that it's going
Speaker 1: to be very difficult to achieve, if that's a polite
Speaker 1: way of putting it. But at least it shows like
Speaker 1: everything you're saying is sort of again this technology that
Speaker 1: maybe at some point, you know, if we go back
Speaker 1: to Fukushima and what happened there with the earthquake and
Speaker 1: then the tsunami, and then you know what we saw
Speaker 1: then the reaction in Germany that was very much a
Speaker 1: technology that was out of fashion to an extent one
Speaker 1: could even describe as irrationally so and it seems like
Speaker 1: now that you know from everything you've described, nuclear is
Speaker 1: beginning to have a bit of a moment again because
Speaker 1: of again of global events.
Speaker 2: Nuclear is having a moment if you rely on politicians, statements,
Speaker 2: NGOs who are freaking out that we're not really resolving
Speaker 2: addressing net zero aspirations in climate change. But when you
Speaker 2: look into the nuts and bolts and you realize how
Speaker 2: difficult and challenging it is to build these nuclear power plants,
Speaker 2: at least in the West, now that it becomes a
Speaker 2: much harder and more difficult slog than there are in
Speaker 2: other places in the world. We've lost the ability in
Speaker 2: the West to build nuclear power plants on time and
Speaker 2: on budget. And that's manifested by the fact that the
Speaker 2: Chinese can build a nuclear power plant, a large one,
Speaker 2: for maybe one fifth of the court that we can
Speaker 2: do it in the United States. So it's understandable that
Speaker 2: the Chinese are building twenty nine nuclear power plants right
Speaker 2: now and the US is not building any simply because
Speaker 2: every utility in the country is freaking out by the
Speaker 2: realization that the next nuclear reactor may be slightly cheaper
Speaker 2: or maybe not got it.
Speaker 1: It's sort of like even if maybe nuclear is becoming
Speaker 1: a little bit more popular again, it doesn't magically make
Speaker 1: it easier to do or solve the fact that, you know,
Speaker 1: in the US, at least, the skilled workforce required to
Speaker 1: build these reactors isn't there.
Speaker 2: We assembled a skilled workforce for building the Vogel three,
Speaker 2: for the last two reactors that were completed, that was
Speaker 2: completed several months ago. Finally, what has happened to that workforce?
Speaker 2: There is no second large nuclear project for them to
Speaker 2: go to. In China, you'll have six reactors built on
Speaker 2: the same site, and the workforce will go from one
Speaker 2: to the next, to next to next. Where are all
Speaker 2: those workers that built the Vogel three and four. There's
Speaker 2: no new nuclear project being proposed or actually constructed now,
Speaker 2: so they're being dispersed and pursuing other opportunities.
Speaker 1: Seems like a missed opportunity because a lot of maybe
Speaker 1: you could characterize the cost overruns with that project, is
Speaker 1: the cost of learning again, training up those workers, you know,
Speaker 1: developing those skills in the country. And then the US
Speaker 1: is not taking advantage of that. Right.
Speaker 2: The US government is suggesting that the next ap one thousand,
Speaker 2: the reactor or the next large reactor that theoretically would
Speaker 2: be built in this country will come in at a
Speaker 2: cost advantage of say thirty percent. I'm not exactly sure
Speaker 2: that will happen. I'd love to see it happen, but
Speaker 2: I'm questioning whether or not that can happen in an
Speaker 2: environment where we have persistent inflation and higher interest rates
Speaker 2: than we had over the last couple of years.
Speaker 1: So this is kind of, you know, tease up the
Speaker 1: sort of getting onto the main topic today. So, as
Speaker 1: I mentioned, we have maybe a more favorable view developing
Speaker 1: globally for nuclear and in the US, but maybe an
Speaker 1: industry that is not in a state to step up
Speaker 1: to where it needs to be to kind of ride
Speaker 1: that wave. Mixing my metaphors. And then suddenly there's this
Speaker 1: new factor you mentioned climate, you mentioned Russia and energy security.
Speaker 1: And then there's this third thing that everyone is talking about,
Speaker 1: which is demand growth for electricity coming from data centers.
Speaker 1: So do you think that's going to shake things up
Speaker 1: in any way?
Speaker 2: I certainly think it will, and we're seeing evidence of
Speaker 2: that where the large Hyperscalers, the Amazons, the Googles, the Microsofts,
Speaker 2: the meta are all negotiating contracts with advanced reactor companies
Speaker 2: and also suggest that we bring back some of the
Speaker 2: older reactors that have been prematurely retired because of inexpensive
Speaker 2: natural gas or intermittent renewables. And these are very valuable
Speaker 2: assets that I will continue to serve for for several
Speaker 2: more years. So it is a combination of we need
Speaker 2: reliable twenty four to seven electricity that is carbon free,
Speaker 2: and nuclear power is a great source of that.
Speaker 1: And it's interesting because you mentioned both the advanced reactors
Speaker 1: and then this idea of bringing back some of the
Speaker 1: older reactors. So let's focus for a second on the
Speaker 1: advanced reactors. Why are they being spoken about? You know,
Speaker 1: why is there so much interest in those parsically because
Speaker 1: unlike the conventional reactors, they're not proven. So there's this
Speaker 1: new challenge and we're looking to a new solution rather
Speaker 1: than an existing solution.
Speaker 2: So one has to realize that there's five pathways to
Speaker 2: nuclear power. There are large reactors, small modulear reactors, advanced
Speaker 2: reactors now explain the difference, microreactors less than fifty magua,
Speaker 2: and finally fusion. Each one of these technologies have different
Speaker 2: risk profiles, cost uncertainty, and timelines to commercialization. So when
Speaker 2: you look at a large reactor, it took fifteen years
Speaker 2: from filing of the initial application license until electrons are
Speaker 2: flowing onto the grid. For many of these hyperscalers waiting
Speaker 2: for fifteen years, we've missed the opportunity. But will the
Speaker 2: SMRs or the advanced reactors cross the finish line sooner
Speaker 2: and be able to deliver electrons to the grid before that,
Speaker 2: And the vendor suggests yes, they will, they're looking at
Speaker 2: the end of this decade. I suggest that's probably more
Speaker 2: likely after twenty thirty, given the molasses movement historically of
Speaker 2: the nuclear power industry, so that we're looking at twenty thirty.
Speaker 2: But there are several other reasons why you'd like to
Speaker 2: look at a SOMR. There's a smaller emergency planning zone,
Speaker 2: so you don't have more area that needs to be
Speaker 2: excluded unpopulated around these nuclear power pl Allegedly, there's a
Speaker 2: quicker time to market, as we've talked about, there's lower
Speaker 2: upfront capital costs, so you're talking thirty four billion dollars
Speaker 2: for two large reactors. You can get a three hundred
Speaker 2: megawote reactor an unspecified cost, but it's going to be
Speaker 2: less than the costs of the large reactors hypothetically. And
Speaker 2: then there's also the ability to add capacity as you
Speaker 2: need it. As the data center demands grow, you can
Speaker 2: add incrementally to the power supply. And finally, you avoid
Speaker 2: the problem of single shaft risk if the reactor. If
Speaker 2: you lose a thousand megawatts of capacity, if something goes on,
Speaker 2: it's a problem. If you have three three hundred megawatt
Speaker 2: reactors operating, if you lose three hundred megawats, you may
Speaker 2: be able to find a work around that's not going
Speaker 2: to be so catastrophic.
Speaker 1: So there's various facts. I think the one that's really
Speaker 1: interesting is this kind of time to market that you mentioned.
Speaker 1: You know, because this demand growth in relations data sensors
Speaker 1: is so pressing. So are you saying that we know
Speaker 1: that conventional nuclear takes a long time. Even though there's
Speaker 1: all the issues we mentioned with the workforce in the US,
Speaker 1: it is still a known quantity to some extent. And
Speaker 1: what we know is that from a regulatory perspective, it's
Speaker 1: going to be working through molasses. And so some of
Speaker 1: these small modular reactors they're kind of what they're banking
Speaker 1: on is that that process is so slow. If they
Speaker 1: have a technology that does not need to have such
Speaker 1: tight regulatory oversight, they can maybe commercialize that technology and
Speaker 1: get it through the regulatory process in the same kind
Speaker 1: of time frame that it would take for conventional nuclear
Speaker 1: to just get through the regulatory process. Is that what
Speaker 1: their their role of the dice is.
Speaker 2: Well, the role of the dice is that we will
Speaker 2: go through the regulatory process and then we will be
Speaker 2: able to deliver and build these reactors in a faster timeframe.
Speaker 2: They're sorter timeframe than the larger reactors. And very, very importantly,
Speaker 2: we talk about the difference between the first of a
Speaker 2: kind cost and the nth of a kind cost. How
Speaker 2: fast can a reactor or vendor proceed down the learning curve.
Speaker 2: If you're making small reactors and you have a long
Speaker 2: pipeline of potential customers, you can invest in the manufacturing
Speaker 2: infrastructure with which to make these reactors, build these reactors
Speaker 2: more efficiently, and then get down the learning curve. Think
Speaker 2: what it's like to sort of manufacture reactors in something
Speaker 2: similar to a commercial Boeing jet manufacturing facility.
Speaker 1: And what's interesting there as well? I mean you mentioned, yeah,
Speaker 1: they're smaller so you can come down the cost curve
Speaker 1: faster to get to end of a kind. And the
Speaker 1: other thing that is essential to doing that is having
Speaker 1: a kind of a pipeline of customers. And if I
Speaker 1: think about wind and solar, the tech industry has been
Speaker 1: really essential in various different ways in developing the market
Speaker 1: in the US for those technologies. And so it's interesting
Speaker 1: then that you know, now we're talking about data centers
Speaker 1: creating this new demand, this new interest from the tech
Speaker 1: industry in new nuclear technologies. I would characterize that nuclear
Speaker 1: probably can't succeed without the interest of that particular sector.
Speaker 1: Maybe I'm wrong. I mean, you can push back on
Speaker 1: that if you don't agree. But to that point, which
Speaker 1: companies have we seen engaging with nuclear and in what
Speaker 1: particular technologies?
Speaker 2: So the four major hyperscalers are all very much involved.
Speaker 2: We have Amazon has invested in one of the advanced
Speaker 2: reactor companies and now it's ex Energy. They can participate
Speaker 2: in the Series C five hundred million dollar financing, and
Speaker 2: that was there. Google has committed to buy a certain
Speaker 2: amount of energy from several chiros multen salt reactors technologies
Speaker 2: that they're developing. And Microsoft has contracted to buy electricity
Speaker 2: from some of the large reactors that are being brought
Speaker 2: back to life, specifically the Three Mile Island in Pennsylvania.
Speaker 2: And just the other day Meta got into the act
Speaker 2: and asked for a request for prosals for between one
Speaker 2: to four gigawatts of nuclear power to power their data centers.
Speaker 1: That's so interesting, and I remember in your the note
Speaker 1: that you wrote about this topic. The thing that was
Speaker 1: also interesting. I think it was even companies that were
Speaker 1: not necessarily engaged with the tech companies directly saw their
Speaker 1: share prices increase with each of these announcements. I suppose
Speaker 1: it's not just reflecting how much influence these tech companies
Speaker 1: interest has on the sector's prospects as a whole.
Speaker 2: The two companies that you're talking about Oklo trades on
Speaker 2: the New York Stock Exchange Oklo and New Scale trades,
Speaker 2: I think it's over the counter. SMR is the symbol.
Speaker 2: New Scale suffered a setback at the end of twenty
Speaker 2: twenty three when their principal project selling four hundred and
Speaker 2: seventy two megawate plant to uamps based on the Idaho
Speaker 2: National That project was canceled because of allegedly high costs
Speaker 2: that stock try to below two dollars or close to
Speaker 2: two dollars. I checked today that stock is up to
Speaker 2: twenty six dollars. New Scale has the only company so
Speaker 2: far that has gone through the licensing gauntlet of the
Speaker 2: NRC with their fifty megawatt reactor. They're upgrading they're designed
Speaker 2: to seventy seven megawatts and they hope that they will
Speaker 2: be out of the gate with that sometime in the
Speaker 2: middle of twenty twenty five. And they have many negotiations
Speaker 2: with potential data center companies, and so there's a tremendous
Speaker 2: amount of interest for them. They seem to be ahead
Speaker 2: of the market. Olklow as well has signed various different
Speaker 2: contracts with data center companies. They're having an approach which
Speaker 2: are much smaller up to fifty megawatch reactor which can
Speaker 2: be deployed very quickly, very easily. They're in the process
Speaker 2: of talking with the US Air Force for building a
Speaker 2: reactor that will sell electricity to an Air Force base
Speaker 2: in Alaska, and that's a very interesting project. Their technology
Speaker 2: is also well suited to providing and displacing electricity from
Speaker 2: diesel generators in the far north of Canada.
Speaker 1: For example, when you're talking about New Scale. You mentioned
Speaker 1: the NRC, which I presume is an abbreviation for Nuclear
Speaker 1: Regulatory Commission.
Speaker 2: Exactly.
Speaker 1: Amazing, So, apart from clarifying what that abbreviation means, I'm
Speaker 1: kind of curious because it sounds to me like from
Speaker 1: the way you're describing it is that if we're looking
Speaker 1: at the progress these companies are making in getting real
Speaker 1: credible projects close to commercialization, we should be looking at
Speaker 1: how they're getting through the NRC's process. The NRC is
Speaker 1: a US agency, Is that correct?
Speaker 2: Is yes, But there is the Generic Design Assessment in
Speaker 2: the UK, the Canadian Regulatory They all have very rigorous
Speaker 2: processes to make sure that the nuclear technology that's being
Speaker 2: developed is going to be safe opera R correctly, and
Speaker 2: it's in our interest that we have a very rigorous
Speaker 2: process for that. The Biden administration passed the Advanced Act,
Speaker 2: which is going to suggest to the NRC to streamline
Speaker 2: the process so instead of taking three to four years
Speaker 2: to license, it should be done in twenty four miles.
Speaker 2: And also, New Scale spent five hundred million dollars on
Speaker 2: its own staff preparing a license application and paying the
Speaker 2: fees that the NRC would charge for reviewing all of
Speaker 2: these applications. That's a pretty formidable obstacle for many of
Speaker 2: the upcoming startups in the nuclear power industry, and so
Speaker 2: there is some provisions in the Advanced Act to sort
Speaker 2: of lessen that financial burden.
Speaker 1: So it sounds like there's a lot of tailwinds to
Speaker 1: brewing for particularly SMRs, Advanced Nuclear, all of these companies
Speaker 1: that we're talking about. You know, for all the reasons
Speaker 1: we discussed this on nuclears back in fashion, there's also
Speaker 1: this new need of meeting data sent some demand and
Speaker 1: very specifically the tech industry that can really make things
Speaker 1: happen are showing so much interest. So with that sort
Speaker 1: of very optimistic picture in mind, I suppose it's also
Speaker 1: your job as an analyst to pour cold water all
Speaker 1: over every time someone gets too excited about any new technology.
Speaker 1: That's that's kind of what we do. So what are
Speaker 1: the potential stumbling blocks for this upscaling?
Speaker 2: When I look at the opportunities presented to the nuclear
Speaker 2: power industry and all the vendors associated with it, I
Speaker 2: look at where they sit in the licensing process. Have
Speaker 2: they engaged with the NRC. There's twelve companies that are
Speaker 2: out in pre application discussions with the NRC, so they're
Speaker 2: having conversations as we're having conversations, say this is what
Speaker 2: we're proposing to do. Does this make sense? Yes, back
Speaker 2: and forth. So if you're not in the NRC engagement
Speaker 2: process already, I don't consider you a serious company that's
Speaker 2: going to come to the finish line sometime in the
Speaker 2: next few years. The second thing that is very very
Speaker 2: important is that you have the financial backing that it
Speaker 2: takes to go ahead and cross the finish line. We've
Speaker 2: seen the first company who was trying to build a
Speaker 2: small microreactor. The first project was going to be in Canada.
Speaker 2: They went bankrupt because they didn't sort of succeed in
Speaker 2: raising the cash that was necessary to go forward. That's
Speaker 2: very very important, and do they have a technology that
Speaker 2: seems to be responsive to the needs of the utility
Speaker 2: marketplace and also the hyperscale opportunity. There are big distinctions
Speaker 2: between small module reactors, which are light water reactors, which
Speaker 2: are just innovations of just shrinking the size to the reactor,
Speaker 2: but the same type of technology, and the idea is
Speaker 2: we can build them smaller for less money and quicker.
Speaker 2: Then the advanced react to technologies, the terror Powers which
Speaker 2: is developing a sodium cooled fast reactor, x Energy which
Speaker 2: is developing a helium cooled high temperature gas reactor, and
Speaker 2: Chiros which is developing a molten salt reactor hybrid type
Speaker 2: of technology. All of these represents innovations in the nuclear space.
Speaker 2: That's a departure from historical technology that has been deployed.
Speaker 2: If you think about the oil and gas industry, the
Speaker 2: renewable energy industry, we have seen a tremendous amount of
Speaker 2: innovation in all of those industries come to the marketplace
Speaker 2: and the result has been significantly reduced costs for the
Speaker 2: production of gas, oil and renewable wind power and solar power.
Speaker 2: Where has the innovation come in the nuclear space. We
Speaker 2: are now seeing it come in the form of a
Speaker 2: fast reactor, a high temperature gas reactor, and a molten
Speaker 2: salt reactor. These are new technologies that afford the promise
Speaker 2: of being a safer they promise to be more efficient,
Speaker 2: they promise to have less spent fuel, which is a problem,
Speaker 2: and they're very very exciting to see all of these
Speaker 2: moving forward. And it's a decision that utilities and hyperscalers
Speaker 2: need to sort of make a decision large reactors, small reactors,
Speaker 2: advanced reactors, and there's different risk and challenges that each
Speaker 2: of these face. And then if you even take it
Speaker 2: a step further, you have microreactors if we talked Oakloh
Speaker 2: And also we have fusion technology, which is something that
Speaker 2: we cannot ignore because a fusion industry has raised seven
Speaker 2: point one billion dollars for private sector investment among thirty
Speaker 2: or so companies, and having been to many fusion facilities
Speaker 2: in the US and Europe, I can say that there's
Speaker 2: something that about that technology that presents some very interesting
Speaker 2: possibilities for starters. The prototype that's being built in Devon's,
Speaker 2: Massachusetts by Commonwealth Fusion, it's located within three hundred meters
Speaker 2: of residential housing. You couldn't put a large reactor within
Speaker 2: three hundred meters or a small fission reactor. And this
Speaker 2: technology is safer, it will follow a different regulatory path,
Speaker 2: and so the path way to commercialization once they prove
Speaker 2: their technology, once they can commercialize their technology, will be
Speaker 2: much simpler and easier and faster.
Speaker 1: This kind of raises an interesting question to me. So
Speaker 1: we've got these five different pathways, including conventional nuclear and
Speaker 1: there is this kind of need to be met, and
Speaker 1: we talked about you knows so challenging in different ways.
Speaker 1: But the fact that there's five different ways to get there.
Speaker 1: On the optimistic side, does that multiply the chances is
Speaker 1: that something will be able to meet the moment by
Speaker 1: five because there's five different, quite independent pathways to get there.
Speaker 1: But on the flip side, does that mean that if
Speaker 1: one of these technologies can get their first to meet
Speaker 1: the moment, does it massively squash the chances of relevance
Speaker 1: for the other four.
Speaker 2: I certainly would not want to be a utility right
Speaker 2: now trying to decide which horse to bet on in
Speaker 2: those five technology options. There's not going to be a
Speaker 2: winner take all situation. I think that the larger reactors
Speaker 2: have certain applications in the in the US market and
Speaker 2: North American market, and they're being looked at by a
Speaker 2: variety of utilities and hyperscale developers. And however, the SMRs
Speaker 2: seem to offer certain attractions, certain advantages, and certainly do
Speaker 2: the advanced reactors. So it's a very very difficult situation.
Speaker 2: I think that you will see, you know, niche markets
Speaker 2: develop and there'll be opportunities for all of these technologies
Speaker 2: going forward.
Speaker 1: So kind of last question from me, you know, talking
Speaker 1: about all these new technologies that could meet the moment,
Speaker 1: including also building out of the conventional technologies. But then
Speaker 1: the other thing, and you alluded to it earlier, is,
Speaker 1: for example, the deal between Microsoft and Three Mile Island
Speaker 1: to bring back existing nuclear plants that have been shut
Speaker 1: down but can be reopened and you know, still have
Speaker 1: potentially life in them with a little bit of investment.
Speaker 1: Do you see that as a near term solution? And
Speaker 1: you know how significant could that be? Is a three
Speaker 1: Mile Island for example, is that a one off? Or
Speaker 1: is this it's not going to become a thing.
Speaker 2: We've closed eleven reactors in the US in the last
Speaker 2: fifteen years since Fukushima, and of the eleven, I look
Speaker 2: and suggests that perhaps we can bring back three of them.
Speaker 2: The Palisades Nuclear Reactor is the first out of the
Speaker 2: gate that's trying to be developed by Holtech, the owner.
Speaker 2: That could be in NRC approval in the third quarter
Speaker 2: of twenty twenty five and starting to operate in twenty
Speaker 2: twenty six. Three Mile Island may be the second one
Speaker 2: a year or two later, and there's another reactor out west.
Speaker 2: There's also a possibility that has been recently closed. But
Speaker 2: of the eleven reactors we see, three of them are
Speaker 2: possible candidates. However, what is going to happen at Pallisades.
Speaker 2: The plan is for the existing reactor and we come
Speaker 2: back online, and then Haltech, which is developing a three
Speaker 2: hundred megawatt lightwater reactor, they will build two of those
Speaker 2: reactors on that site. It makes it a much easier
Speaker 2: commercialization pathway if you can build a new reactor at
Speaker 2: an existing site. Some of these other sites that have
Speaker 2: been closed may be opportunities for SMRs to be on
Speaker 2: the same site. Hall Take owns Oyster Creek facility in
Speaker 2: New Jersey that is a logical candidate for an SMR.
Speaker 2: There's discussions about bringing back nuclear to Indian Point, twenty
Speaker 2: five miles north of New York City. They have an
Speaker 2: interesting opportunity there. However, in all of these situations, you
Speaker 2: have nimbiism going on, local opposition and people are starting
Speaker 2: to complain, well, we don't really want to bring these
Speaker 2: reactors back. And that's a very very important thing that
Speaker 2: has to be looked at. Is that's one thing to
Speaker 2: talk about bringing a reactor back. As soon as you
Speaker 2: start the process that people come out of the woodwork
Speaker 2: and suggest, well, maybe we don't really want to do that,
Speaker 2: and that's something that has to be carefully managed and
Speaker 2: a lot of communications and cultivation of the local surroundings
Speaker 2: to go ahead and let them move forward with the
Speaker 2: project with local buy.
Speaker 1: It sounds to me like even with these challenges, there
Speaker 1: has been a period of not much happening in the
Speaker 1: nuclear industry, particularly in the US, and then suddenly lots
Speaker 1: is happening all at once, even if the plants haven't
Speaker 1: yet arrived. It reminds me of there's a British poet
Speaker 1: called Wendy Cope who has a poem called Bloody Men,
Speaker 1: and I can't remember the entire poem, but the first
Speaker 1: line is bloody men are like bloody busses, and the
Speaker 1: point is is that you wait for one to come
Speaker 1: along and then to arrive at once. I sort of
Speaker 1: feel talking to you, like, this is what you're experiencing.
Speaker 1: We've waited for some activity on the nuclear front for
Speaker 1: a good amount of time, and we've had a bit
Speaker 1: of promise, and then now suddenly there's a lot happening
Speaker 1: all at the same time. We've got these five different pathways,
Speaker 1: and as you said, it's a nuclear so if you're
Speaker 1: a utility, you don't even know which one to back,
Speaker 1: which is the right bus to get onto. I don't know.
Speaker 1: Would you say that's a fair characterization of the situation now.
Speaker 2: I think there's a lot of innovation, there's a lot
Speaker 2: of enthusiasm. There's a huge need for baseload, non intermittent
Speaker 2: and carbon free electricity, and so the stage is set.
Speaker 2: What we really need to see is regulatory approval, licensing,
Speaker 2: and construction to start. Once the first reactor is under construction, working,
Speaker 2: starting to work and move forward, then I think we'll
Speaker 2: see a lot of utilities and hyperskilles. I want the
Speaker 2: same thing, and we'll follow. So it's just a matter
Speaker 2: of breaking the ice, getting the first reactor licensed and operating.
Speaker 2: And it's the first time in the US since two
Speaker 2: thousand and seven that we haven't had a nuclear power
Speaker 2: plant under construction, and that's pretty sad.
Speaker 1: Chris, this has been really fascinating. As always, Thank you
Speaker 1: very much for stimulating conversation.
Speaker 2: Thank you, Tom.
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