Almost three dozen firms representing $1.3 billion of investor money are pursuing technological innovations in the field of nuclear energy. A June 2015 report by the Third Way, a Washington, DC, think tank, details the mix of firms includes small startups and big-name investors like Bill Gates.  All are placing bets on a comeback for nuclear energy working to get their respective technologies to market in an increasingly carbon-constrained world.

Samuel Brinton, the report’s author, spoke by phone with this blog about the report.  Brinton, who is an MIT graduate in nuclear engineering, said that most of the startups are seeking to develop smaller and more efficient nuclear reactors. If successful, they will be the answer, collectively, to the anti-nuclear rant of now former VP Al Gore who once told a congressional committee that all reactors all come in one size – large.

Some of the most interesting characteristics of the new designs are that they are engineered to use spent nuclear fuel.  Brinton estimates that over time, if even just eight of the 33 designs listed in the report make it to market, their life cycle demand for spent nuclear fuel could add up to as much as 25% of the current US inventory. A few designs propose to use thorium as a fuel.  Another feature is that coolants run the gamut including liquid metal, high temperature gases, and molten salt.

Here’s a brief run down of the 33 firms profiled in the Third Way report by type. Readers will note there is overlap among the types. This is the classification used in the Third Way report. The report also discusses work on fusion reactors, but that aspect of it isn’t addressed here.

Reactor Types by Design Approach

• 7 Molten salt, some thorium fueled
• 9 Liquid metal cooled, some SMRs
• 5 High temperature gas (HTGR)
• 2 Pebble bed (HTGR)
• 4 Small nuclear battery
• 6 Small modular reactor (LWR) or (Fast Reactors)

While the Third Way report does not attempt to pick winners or losers among the 33 designs, Brinton said eight of the advanced designs, as distinct from LWR type SMRs, are more likely to make it to market sooner rather than later.  Brinton didn’t put a time line on any of the designs on his informal short list which isn’t part of the official report. See graphic below on reactor types

Reactors with Prospects for Shorter Time to Market

~ Less than 300 MW

• Terrestrial Energy, Mississauga, Ontario, CA; Molten salt
• Advanced Reactor Concepts, Reston, VA; Liquid cooled metal
• Gen4 Energy, Denver, CO; Liquid cooled metal
• General Atomics, San Diego, CA; High temperature gas

~ 300 MW or More

• Terrapower, Bellevue, WA; Liquid cooled metal
• Transatomic Power of Cambridge, MA; molten salt
• Areva/NGNP, Bethesda, MD; High temperature gas
• General Electric/Hitachi, Wilmington, NC; Liquid cooled metal

Innovative reactor designs by type. Graphic courtesy of Third Way.

Tipping Points to Success

There are two “tipping points” for success Brinton said. The first is that everyone working in these advanced designs is watching to see how the US Nuclear Regulatory Commission (NRC) deals with the first design review and license for a small modular reactor (SMR). These are light water reactor designs which is what the NRC knows best.  One of the key safety issues which stand out is whether a single control room can be used to manage multiple small units.

NuScale, which is developing a 50 MW SMR, has announced it will submit its design to the NRC by the end of 2016, and that its first customer, UAMPS, will submit a license application once the design review gets the NRC’s approval. The agency has pledged to complete the design review in about 36 months.

The NuScale SMR is based on well-understood light water reactor design principles. What makes the project different is that the firm wants to sell its reactors like beer – in six packs.

A mature installation would have 12 50 MW reactors built over time with the revenue from the first unit paying for the second, and so on.

While there is a competitive advantage for whomever comes second after NuScale, the second tipping point isn’t a regulatory hurdle. It is the vendor who fills an order book with enough customers to raise the money to build a factory to fabricate SMRs either of light water design, or innovative technology, and reap competitive savings from a production line. An SMR is loosely defined as having an electrical power output of less than 300 MW.

In November 2014 former US Secretary of Energy Steven Chu told the Guardian newspaper that the key to success for SMRs isn’t the first unit, it is the 10th unit. He predicted significant cost savings could be achieved by the time a vendor is building its sixth unit and accumulating savings thereafter. Brinton agrees. He said,

“The financial advantages of advanced nuclear reactors including SMRs will be their ability to reduce initial capital expenditures and as the demand increases provide more factory construction which will in turn reduce cost and drive demand spurring further factory benefits. It is the best kind of feedback loop.”

That doesn’t imply that the larger designs, like Terrapower, don’t have an equal chance of commercial success. One of the success factors for advanced nuclear reactor designs is that they differentiate themselves in terms of how they are used.

The Third Way report notes that some of these applications include providing dependable power in remote areas, process heat for industrial use, and electrical power for desalinization using remote osmosis processes.  All of the designs hold a promise to reduce proliferation concerns, especially those that use spent fuel.

The report also points out that SMRs, regardless of technology basis, are candidates to replace coal-fired boilers at existing power plants since the rest of the infrastructure could be reused.

Cost Estimates Still Uncertain

Information on the estimated costs to build these advanced designs isn’t readily available, but Brinton says that the first of a kind units aren’t likely to be less costly per kWe than their conventional 1000 MW cousins.  The global market average is running at around $4,000/kWe. It is higher in some countries like the UK and lower in others like China.  Time to build the innovative units depends greatly on whether each unit is a custom job or whether the vendor can justify investment in a factory.

Competition or Community?

There is more to just time to market and the other competitive issues associated with bringing first of a kind designs to commercial fruition. Brinton is passionate on the point that while businesses will always compete, he feels the advanced nuclear reactor businesses cited in the Third Way report need to see themselves as a community.

They will face common issues, he says, in gaining regulatory approvals whether in the US or in other countries. They will need to adapt nuclear quality standards to components that have never been manufactured before by a supplier, and they will have to support training of a new generation of nuclear engineers and skilled trades to build and operate the plants. He notes,

“Many of my peers who are leading these companies joined the nuclear innovation community because we wanted to address the climate crisis. My warning to them is that they must unite as an advanced nuclear community if they are to have a hope of enacting the changes in policy needed to allow them to survive. I hope to be a part of that unification process.”

Future work?

What’s next for the Third Way’s energy program? Brinton said that he wants to address the challenges developers face in proving their technologies include getting access to test facilities.  It is not easy or economical to do so right now he says. 

Another issue is that some vendors have no interest in developing their products for US markets.  The reason is the NRC simply isn’t ready to do safety reviews for advanced designs.  In fact, the agency is realigning its workforce and may, in future years, be smaller in terms of full time civil servants, than it is today. 

Without expertise or guidelines to address a safety review of an advanced reactor design, the developers, like Terrapower in China, are likely to seek success in other countries.

The US will be poorer for it if it cannot capture the value these entrepreneurs are working to create. Brinton and his colleagues at the Third Way are looking for answers to these issues.

For more information

Samuel Brinton
Fellow, Clean Energy Program
Third Way, 1025 Connecticut Ave. NW, Suite 501 Washington, DC 20036
202.467.6641 direct 202.768.4413 mobile or email: sbrinton@thirdway.org

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Postscript: Readers may also be interested in a report published in Fortune Magazine titled, “Why startups can save nuclear tech” on July 6th.