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MacroVoices #355 Mark Nelson: Understanding All Things Nuclear
02:34:25
In this first part of holiday special, MacroVoices welcomes nuclear engineer Mark Nelson to the show to discuss all things nuclear. Erik and Mark start with a brief history of the industry, then talk about both real and perceived problems with nuclear power, before moving on to discuss advanced nuclear technologies including small modular nuclear reactors, molten salt cooled reactors and Thorium-fuelled nuclear reactors. https://bit.ly/3Wg3q2J Radiant Energy Group Kirk Sorensen: Thorium, an alternative nuclear fuel Mothers for Nuclear Clean Core Thorium Energy Worlds Nuclear Association Library What Is Nuclear Energy? - Nick Touran The Story of Storage (Mark Nelson Masterclass) - Decouple Podcast Something's Rotten with French Nuclear- Decouple Podcast The Russian Atom feat. Mark Nelson- Decouple Podcast What Went Wrong at Vogtle? feat. Mark Nelson - Decouple Podcast A Hard Landing for Soft Energy - Decouple Podcast On the use and abuse of LCOE - Decouple Podcast Dutc...
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- [00:08]
A
This is Macro Voices with hedge fund manager Eric Townsend. The free weekly financial podcast targeting professional finance, high net worth individuals, family offices and other sophisticated investors. Macro Voices is all about the brightest minds in the world of finance and macroeconomics, telling it like it is bullish or bearish. No holds barred. Now here are your hosts Eric Townsend and Patrick Suresna.
- [00:38]
B
Macro voices Episode 355 was pre recorded in early December to air on December 22nd, 2022. I'm Eric Townsend. Happy Holidays everyone. This episode of Macro Voices was made possible by Respect Energy, a leading European trader of renewable energy and a one stop shop for all green energy investors. We're taking this week and next week off to give our production staff time with their families this holiday weekend. So we'll be deviating from our usual show format to bring you our two part 2022 year end special. The theme of this special series is nuclear energy and how to invest in it. There will be no crude oil update or post game segment this week or next. Then we'll return to our usual show format on January 5th. My guest for this week's feature interview will be nuclear engineer Mark Nelson and the focus of this week's episode will be understanding all things nuclear energy. We'll start with a brief history of the industry and then talk about both real and perceived problems with nuclear power before moving on to discuss advanced nuclear technologies including small modular nuclear reactors, molten salt cooled reactors and thorium fueled nuclear reactors.
- [01:53]
C
And I'm Patrick Ceresna. Eric, let's start with a roadmap. What are we trying to accomplish with this year's two part year end special and what can listeners expect both this week and next?
- [02:03]
B
Let's start by explaining why we chose the topic of nuclear energy. I've been convinced for several decades now that we need to modernize nuclear power generation, use new technology to make it much safer than it used to be, and then invest in a nuclear renaissance in which nuclear power becomes the principal baseload electrical power generator generation source to replace coal burning power plants which are the biggest contributors to carbon emissions. To be clear, I'm still a huge fan of renewable energy sources such as wind and solar, but they can only solve part of the problem, and nuclear energy is the only sensible answer to where the rest of the capacity we need is going to come from. But I'm also convinced that public sentiment is so strong that and policymakers failure to intelligently pursue ESG objectives is so blatant that nuclear power will never be given a fair shake until we're literally forced by circumstance to recognize that nuclear is the only viable solution to the coming energy crisis. I'm reminded of the famous Winston Churchill quote, the Americans can always be counted on to do the right thing after having first exhausted all other possibilities. And that's exactly what's going to happen with energy policy. Virtue signaling Politicians are going to continue to pretend that renewables can solve all of our problems because that's what their constituents want to hear. Misplaced energy policy, inspired by the climate lobby will eventually throw us headfirst into a global energy crisis in which crude oil and natural gas prices will skyrocket. When that happens, we'll finally wake up and recognize that the nuclear power industry's safety problems can easily be solved with technology. And a nuclear energy renaissance will begin, led by government policy that makes nuclear energy top priority. But before any of that happens, we're almost certainly going to first experience a global recession that will probably take both oil prices and stock markets much lower. The depths of that recession will mark a generational opportunity to go long crude oil, uranium and nuclear technology stocks. And that means that right now, just as that recession is starting, it's time for investors to come up to speed on all things nuclear and start making a wish list for what to buy when the coming recession hopefully brings us bargain prices.
- [04:40]
C
Okay, got it. So what exactly do we have planned for our listeners in this two part special? Starting with this episode, listener feedback from.
- [04:48]
B
Prior years has been that our listeners love extra long form interviews on holiday weeks because it creates a perfect opportunity to tell your mother in law, oh, sorry, I have to listen to this business thing for work, so I can't talk to you about your political views right now. So sorry. So we're really going to lay it on in this episode, which will run well over two hours, giving our listeners plenty of ammunition to avoid as many relatives as they care to this holiday weekend. First, I've prepared an opening monologue in which I'm going to zoom all the way out to the single most important lesson I ever learned and then describe the big picture story of why cheap and abundant energy is so much more important to society than than just its investment implications. I worked hard to edit it down, but it's still going to run close to 15 minutes. This will set the context for why right now is such an incredibly important time in the course of human history and why energy policy will be so important to determining our future. Then we'll dive into this week's feature interview with nuclear engineer Mark Nelson. We're going to debunk the perceived problems with nuclear power and and then talk about where the real challenges lie. We'll then move on to introduce some of the new advancements in nuclear technology, such as molten salt and thorium. This week's episode is about understanding all things nuclear. Next week we'll move on to investing in nuclear energy, when my guest will be Uranium Insider newsletter editor Justin Hune.
- [06:21]
C
Sounds like a great plan. I'm setting my stopwatch to count down from 15 minutes, Eric, so don't go overboard with the monologue. So let's start with the most important lesson you know about investing.
- [06:32]
B
The single most important lesson I've ever learned, not just about investing, but about understanding the world around us, is Societal complexity is a function of the amount of abundant and affordable energy available to the economy. Now that's a somewhat nuanced but profoundly important statement, so I'm going to repeat it. Societal complexity is a function of the amount of abundant and affordable energy available to the economy. Please ask yourself why is it that for about 200 years now, society advanced so much more quickly than it did for centuries before that we live and work in high rise buildings with heat, air conditioning, electric lighting, modern plumbing, and so forth. In developed nations, nobody builds their own home or grows their own food unless they have a personal passion for doing so. Instead, people are free to pursue higher education and then move on to careers that never even existed 200 years ago. If you look back in history for many centuries before that, almost everyone worked on farms out of necessity to grow the food needed to feed themselves. University education was extremely rare and few professions even existed other than the most essential ones such as law and medicine. Most people lived in primitive homes they had no choice but to build by hand themselves. Firewood provided the sole source of heating and cooking energy. Plumbing hadn't been invented yet. Human slaves were the primary source of work needed to operate the farms and plantations. What changed that allowed society to progress so much in less than two centuries, so that we now live in high rise skyscrapers and have the luxury of spending our leisure time reading social media on smartphones or even flying anywhere on earth in just a few hours travel time? Most people would answer that question by saying technology is the big thing that changed. The Industrial Revolution and then the semiconductor and computer technology revolution, culminating in the development of the modern Internet, are what most people perceive to be the primary drivers of this accelerated pace of advancement of human society over the last 200 years. Now there's some truth in that answer, but technology is Actually a second order effect, not the driving force. The true underlying reason that humanity has made so much more progress in the last 200 years than it did in the 500 years before that is a marked increase in the availability of cheap and abundant energy. With gasoline now costing more than $3.50 per gallon on average in the United States, it might not feel like energy is cheap right now. But when you consider that 1 gallon of gasoline produces the same amount of useful work as up to 400 hours of human labor, the right way to think about the cost of energy now versus 200 years ago is that a single gallon of gasoline cost three and a half dollars, while the equivalent 482 hours of manual labor cost nearly three and a half thousand dollars. At the current US minimum wage of $7.25 per hour, energy is literally 1,000 times cheaper than than it would be if we had to pay minimum wage workers to do the work now performed by gasoline powered machinery. And that's precisely the reason that societal complexity has advanced so much in the last 200 years because of the availability of cheap energy to replace human labor. That's what allowed us to eliminate human slavery. It's that important. The Industrial revolution could not have happened until it was enabled by the invention of the steam engine. The newfound ability to convert the potential energy contained in coal into physical motion that could be harnessed to accomplish work and automate previously manual processes was the turning point in history which everything else followed to this day. The unit of measure for work performed by any kind of power generation technology is named after James Watt, who perfected the steam engine from earlier inventors prototypes into a commercially viable product between 1763 and 1770. That's when the rapid pace advancement of human society over the last two centuries all started. The age of oil began in 1859 when the first oil well was drilled in Titusville, Pennsylvania. The discovery of rock oil was a much bigger deal than the steam engine. Petroleum and the abundant and relatively cheap products refined from it, such as gasoline, diesel fuel and jet airplane fuel, literally changed everything. The sudden availability of abundant energy enabled the inventions of everything from the automobile to the airplane, to the mechanized farming equipment that liberated most of society from having to work on farms in order to feed themselves. Advancements such as modern cities, public infrastructure and high rise buildings, would never have been possible without modern heavy construction equipment which is powered by diesel fuel refined from petroleum. Societal complexity is quite literally a function of the amount of abundant affordable energy available to the economy 163 years after it began in 1859. The age of oil is now slowly coming to an end. Fossil fuels won't go away as quickly as the climate lobby would like to pretend, but they absolutely do need to be phased out. Regardless of whether you personally believe that anthropogenic global warming poses an existential threat to humanity, an immutable fact is that public sentiment and government policy are now firmly aligned toward achieving carbon neutrality. And even if that public sentiment and policy stance reverses in the coming energy crisis, it won't change the immutable fact that fossil fuels are a finite resource that won't last forever. Even if we try and extend the age of oil, the cost of oil production will continue to increase as a percentage of global gdp, and that will retard the pace of societal advancement. The advances we've seen in the human experience have measurably slowed just during my own lifetime. And a big part of the reason for that is that gasoline no longer cost 30 cents a gallon like it did when I was a kid. Don't write that off as inflation. Gasoline in the United States cost about 31 cents per gallon in 1972. Adjusted for inflation, that's $1.59 per gallon in today's dollars, or less than half what it actually costs today. So we're literally paying twice as much for energy today versus when I was a kid, even after adjusting for actual inflation. And if $1.59 per gallon in today's dollars was still the going price for gasoline, a whole lot more progress would be made because the cost of energy, which ultimately determines the pace of societal advancement, would be less than half what it is today. I'm convinced that gasoline prices above $5 a gallon will become the norm as soon as demand recovers from the recession that's just now beginning. That implies that once we're out of recession, energy will cost at least three times what it cost when I was a kid. Even after adjusting for inflation. That directly translates to societal advancement slowing to one third of the pace it advanced during my childhood. How many years are left before energy derived from petroleum becomes prohibitively expensive is a matter of debate, but at this point, it's an academic debate. What can already be said with certainty is that transitioning the global economy away from oil and gas in favor of something new is going to take longer than we'll be able to continue producing affordable petroleum products. That's why a global energy crisis is unavoidable in coming years. The climate lobby and virtue signaling politicians are fond of pretending that renewable energy Sources such as wind and solar are going to solve everything. Simply put, that view is ignorant and misinformed. It's long past time to stop allowing emotion and hope to cloud immutable, scientifically provable fact. Renewables are clearly important and desperately needed sources of energy, but they cannot ever and will not ever replace more than half of the energy now derived from fossil fuels. For humanity to advance, we need to come up with a viable, realistic strategy for replacing the energy now supplied by oil, gas and coal. And we're already way past late in getting to work on building out a new energy infrastructure to allow humanity to move beyond fossil fuel dependency. It's time to decide what the next big thing will be, to follow oil, gas and coal on the energy stage, and to begin the process of transition. Renewables only solve part of that problem. This planet simply cannot support 8 billion human inhabitants without the amount of energy we now derive from fossil fuels. And our elected officials are rushing to phase out fossil fuels in order to appease the climate lobby before phasing in a viable replacement. That's the real inconvenient truth that nobody dares discuss. There aren't many viable options for replacing baseload power generation, which today is primarily enabled by burning coal. While society has become entranced with visions of a future in which most vehicles are electric, nobody stops to consider where all the electricity needed to power those vehicles will come from. Every bit of energy now supplied by gasoline and diesel fuel will need to be replaced with new electric generation capacity we simply don't have yet. So truly phasing out fossil fuels will take much longer and cost much more than almost anyone realizes. What will replace coal for generating the electricity we already generate now? And how are we going to generate enough additional additional electricity to power all those electric vehicles that are expected to replace gasoline and diesel powered vehicles? That's arguably the single most important question facing humanity right now, and few of our elected leaders fully understand the issue. Renewables will definitely play a big role and an important role, but they will never solve more than half of the problem. I'm only aware of two plausible solutions for baseload power generation on the scale we're going to need it. One is so called deep geothermal. But that depends on not yet invented technology. To make geothermal work on the scale needed to replace fossil fuels, we'd have to first figure out how to drill tunnels in 400 degrees Celsius granite miles below the surface of the earth. There are efforts afoot to invent that drilling technology for that exact purpose. But so far it's just a dream, and most geologists see it as a monumental challenge. The other plausible solution is nuclear energy, which has been around for decades, but has an utterly abysmal public perception problem, even in the face of an oncoming global energy crisis. Countries like Germany, which is a well known leader in science and engineering, are working to decommission existing nuclear power generation plants rather than to build new ones. Something's going to have to change and change in a really big way, unless there's a breakthrough in deep geothermal or some other new technology that I'm not aware of. My hypothesis is that the coming energy crisis will force the world to realize that nuclear energy is our only remaining viable option. Until very recently, public sentiment was so universally opposed to nuclear that no progress could be made. The tide is already starting to change, and my prediction is that the floodgates will open when the coming global energy crisis raises gasoline and diesel prices to well over $10 a gallon in the United States and much higher than that in Europe. Domestic electricity prices in Norway are already as much as 10 times higher than they were a few years ago. And when the rest of the world experiences a similar escalation of energy costs, attitudes will change and change fast. So I think a massive nuclear energy renaissance is going to be the likely outcome of the coming global energy crisis. But to be clear, I'm no fan of those in the nuclear industry who are dismissive of entirely legitimate concerns about nuclear power plant safety, nuclear weapons proliferation and nuclear waste disposal. These are very real and legitimate concerns and they must be dealt with. But the more I've learned about the current state of the nuclear power industry, the more I've come to realize these problems are all surmountable with recent developments in advanced nuclear technology. Should we encourage building more early generation, pressurized light water nuclear plants like the ones that melted down at Fukushima Daiichi? I say hell no. If anything, we should be forming a plan to do decommission those 1960s technology Nuclear plants just as soon as we can possibly afford to. But I'm also convinced that modern advanced technology, nuclear power is going to be the solution to the coming energy crisis, barring a breakthrough advancement in deep geothermal or some other new alternative. And that means that for investors, nothing could be more important right now than to learn all about what's changed in nuclear power generation technology since the 1970s or when most of the existing nuclear power plants were built. So this year's Macro Voices two part holiday special series will focus entirely on the Future of Nuclear Energy and How to Invest in It this week my guest will be Mark Nelson, a nuclear engineer, consultant and pro nuclear activist and educator. The subject of this week's interview will not be investing per se, but rather understanding the nuclear landscape, what's changed since the 1970s and which advancements in nuclear technology are important and which are not. Mark and I will also discuss both what the perceived problems with nuclear are and also what the real problems with nuclear are. Spoiler alert. Nuclear energy definitely has its share of very real problems, but they're not the ones the anti nuclear lobby has been whining about for decades. Based on outdated information. We'll give you the straight scoop on both real and perceived issues with nuclear energy in this week's interview with Mark Nelson. My guest next week for part two of this series will be Justin Huhn, editor of the Uranium Insider newsletter and a longstanding Macrovoices regular listener. Justin and I will discuss investing in all things nuclear, with a particular emphasis on understanding the uranium fuel cycle and how investors can position themselves for the coming bull markets in uranium and nuclear energy generally. We'll also discuss other investment opportunities such as the company's pioneering nuclear technology advancements, including small modular nuclear reactors that are built and tested in factories and then shipped to their point of use.
- [22:44]
C
Okay folks, after that one I'm going to keep my response short and sweet and to the point. Eric's feature interview with nuclear engineer Mark Nelson is coming up right after this message from our sponsor.
- [23:05]
B
If you invest to bring about a world powered by green energy, you should meet Respect Energy, a leading European trader of renewable energy that serves as a one stop shop for green energy investors in Europe. Respect Energy brings together independent power producers, accredited and institutional investors holding assets in renewables or undertaking investments in new green energy production such as wind and solar photovoltaic power plants. More than 600 institutional and accredited investors have already entrusted Respect Energy with the sale of their electricity production, portfolio management, O and M services, EPC and project development. If you want to invest in green energy in Europe with the help of a trusted partner, contact Respect Energy today and ask for a tailor made solution. For more information, visit Respect.
- [24:08]
A
And now, with this week's special guest, here's hedge fund manager Eric Townsend.
- [24:15]
B
Joining me now is Mark Nelson. Mark is a nuclear engineer and consultant to the nuclear industry and also something of a pro nuclear activist. Mark, it's great to get you on the program. I don't normally ask Macro Voice's guests about their personal background because they're mostly well Known figures in finance and their bios are available to interested listeners on our website. But your background is quite a bit different from our usual guest. So let's start by setting the wayback machine to 2011. You were a young man in the enviable position of having earned a scholarship to attend graduate school at Cambridge University and needed only to choose your major. Then you saw the same YouTube video that I saw around the same time, produced by a former NASA engineer named Kirk Sorensen. Tell us what that video was about, how it changed your life and where it led you.
- [25:04]
D
Sure, yeah. I needed to study something having to do with engineering, but I just didn't know what I wanted to study. And I came from Oklahoma, which has oil and gas but no nuclear energy. It has wind, but no nuclear. And I came from a family involved in oil and gas on one side, and then on my mom's side, nuclear medicine. And the only thing I knew as a young person is that I had no interest in either. So I'm browsing the Internet, trying to figure out what to do with my life, and I come across this video where the tone sort of was, people don't want you to know that we have the craziest nuclear technology and that nuclear energy is actually incredible, and if we just chose the right reactor, we could solve all the world's problems. And so I started watching the video and it started to explain that there's a new fuel we could use, there's a new reactor prototype we could use, and that nuclear energy can make enough energy to power the world for a billion years without carbon emissions. Once I heard that opening pitch, I pretty much knew that I was going to do nuclear energy. I was just a very strong feeling where I finally found something where it mattered, that I had the technical training of an engineer because it is technology, it is engineering. And yet at the same time, there was this political side to it, there was the cultural side where we had a great treasure, we weren't using it, and surely there was going to be a hard battle to come up with a future based on nuclear. And I knew in a moment that's what I wanted to do. I put my application in for the brand new nuclear engineering program overseas at Cambridge, and the rest is history.
- [26:45]
B
Well, Mark, I really want to salute you because from what I've learned about your career, I know that you're motivated more by a desire to do the right thing for humanity than just to make a buck in a career like most people. And I really salute you for that as a degreed engineer, you're an expert on the science of nuclear energy, how uranium atoms are split in half and self sustaining nuclear fission reactions, and so on and so forth. There are some of the people in our audience who would love to learn all of those details, but frankly, most of the finance people in the audience would prefer to skip the technical details and just understand nuclear energy from the perspective of the investment opportunities it's going to create. So we made an editorial decision. We're going to leave the nitty gritty technical details out of today's interview, but only after first inviting Mark to tell you where on the Internet you can find free resources for those of you who do want to learn how the technology actually works. So Mark, for people who want to know where the neutrons hit, hit the protons and how the stuff all works, where's the best place for them to start and what should they be looking at?
- [27:50]
D
A sentimental favorite for me is the Website what is nuclear.com by working advanced nuclear engineer Nick Turan, who's working on the Bill Gates sponsored advanced reactor that's due to be constructed in Wyoming to replace a retiring coal plant. So Nick, as a, as a hobby and as a service, has put together a very indie website, shall we say, the type that you used to love stumbling across back when Google worked. And I recommend everyone check out what Is Nuclear? For an encyclopedic approach, a balanced, all encompassing approach to the world of nuclear, you can hardly do better than the World Nuclear association online library, where just looking at the number of topics they have available is itself an education in the nuclear industry, nuclear fuel cycle and nuclear history. So got to recommend that sort of big industry association approach and the Nick Turan indie approach. Both of those are fantastic. It's a little more hit and miss if you're just googling on YouTube, but we'll put in a few links to some of the videos I've contributed to some of the online large construction channels or some of the channels that focus on speeches on nuclear energy. And then I have to give a shout out to the man who got me into speaking publicly about nuclear Chris Kiefer. Dr. Chris Kiefer is an emergency room doctor with way too much energy and he started a podcast and a movement up in Canada to help himself discover the world of energy while doing something about it. So the Decouple Media Group is his, his baby. And that's where I first started recording podcasts. And at this point I've, I think I have 12 or 13 on a number of topics where if if I think I I have a good piece of the story, I give it to him and he puts out an episode. So episodes on natural gas and coal and the levelized cost of energy paradox where it looks like you can build nothing but solar and that's cheaper than building expensive nuclear and we break down the disasters construction fiasco at Vogel in Georgia, the only new plant in the US under construction. We take a look at Russian nuclear and how the Russians took over the majority of the global nuclear projects. And anyway, so that over at decouple is probably where I have them most of the serious work that I've put out. And then you can always get a chuckle or a tear from my Twitter at Energy Bands where I discuss issues of the day and occasionally go on long rants about electricity markets.
- [30:36]
B
I've been really enjoying the World Nuclear Library myself, and I can't recommend it highly enough listeners. As always, you'll find all of the external links to the materials that Mark just discussed in your Research Roundup email which accompanies this episode. Mark, let's talk now about the history of the nuclear power industry. I remember as a kid growing up in the early 1970s, the message was that nuclear power, which they called atomic energy back in those days, was coming. It was going to change everything because it was going to provide society with the cleanest, greenest, safest, and cheapest electrical power generation ever seen by mankind. Pollution was going to become a thing of the past, and super cheap electricity would become the norm. We wouldn't need to import fossil fuels ever again from the Middle east, and atomic energy would make electricity so cheap and abundant that it would last forever. Well, guess what? It didn't quite go that way. To whatever extent nuclear power may actually be the cleanest and safest form of power generation, it most definitely does not enjoy a favorable reputation with the general public in those regards. And when it comes to the claim that atomic energy would be much cheaper than burning fossil fuels like coal to make electricity, well, that just plain didn't happen like they promised it would. So please give us the history of the nuclear power industry. What are the main events that investors need to understand in order to navigate this landscape of, you know, how come those promises weren't fulfilled in the 1970s? And what are the new developments in the industry today that we need to understand?
- [32:09]
D
Great intro, and I certainly have had the too cheap to meter thrown in my face more times than I can count. And it's funny that you get that because a lot of the arguments that renewables are taking over goes along the lines of, well, we're going to have so much daytime electricity that we'll need to throw it away. But no, you can't have it for free because we have to pay for the upkeep of the grid. So. So there's a combination too cheap to meter that, plus you have to pay more for your electricity that ends up meaning power that is too worthless to meter and yet when it turns off, power is too precious to afford. So not to try to say that. Nah, nah, other people have it worse. But nuclear did deliver on aspects of its promise in ways that are underappreciated. Here's one. Nuclear electricity, and almost every place in the world is cheaper than burning fossil fuels. But it doesn't mean you get the reactor for free. It just means the fueling, upkeep and long term operation is the cheapest form of available energy. In Germany, for example, they optimize their newest reactors, the only ones they still have running. They optimize those reactors for very low staffing and extremely cheap, secure, ongoing operations. Sure enough, their nuclear power costs about €20 per megawatt hour going forward, whereas their fossil fuels are costing between 100 and €400 per megawatt hour just for the fuel alone. For the fuel alone, it's up to 10 to 20 times more expensive than their nuclear plants. So I'm going to push back, Eric, and say that if you look at the details, nuclear did deliver, but that doesn't mean we had permission, approval or ability to build as many plants as we needed to be for everybody to be as reliant on nuclear as some of the leading countries of the world. So in terms of what it would take to get back to that point, well, that's a long discussion. But in short, there has to be a program and an effort by a nation to decide to get that much nuclear, because in order to replace that much of your power with nuclear, somebody is going to lose out. Existing players are going to have to step aside. And that's where the battle gets quite fierce in policy circles.
- [34:34]
B
One of the things that did go Wrong in the 1970s, nuclear build out was most of those projects were just dramatically way over budget. And you don't have to look any further than the Vogel project in Georgia that you already mentioned to see that not much has changed today. We've still got massive cost overruns in these projects. What's the story there? What is it going to take to get to the point where we can create nuclear energy and Stay on budget while we're doing it.
- [35:04]
D
Yeah, great point. In fact, until recently, Vogel was not even particularly bad by historical standards in terms of time and budget overruns. I mean, that is not a justification. That is not acceptable. I'm not making an excuse, just noting that the crown jewel assets of our strongest utilities are nuclear plants that themselves were as big a fiasco just to build as Vogel is today. We were just doing a bunch of them at a time, and now they just work extremely well in the background and nobody really notices them. And they'll keep working for up to a century, maybe more. I'm not trying to say that we should put up with any amount of incompetency or schedule overrun to build them because they're so valuable. Once we have them, that will keep them forever and it'll make it up. But people almost never remember or mention in the utility spaces the difficulty of building those last plants in terms of the ongoing operation record, which has been extraordinary. Let me give you one little example here. The construction of Diablo Canyon nuclear plant in California was costed out and justified on the assumption that 75% uptime was going to be your max for the reactor. That you would get, say, a capacity factor of 75%. Your total full power hours would be the equivalent to that, you know, three quarters of the time. But instead, the reactors are lasting much longer than expected at a capacity factor of 90% and above, which completely changes the game. Even when, under the rosy projections of the past, now we just adjust our expectations. We expect nuclear to be that good. And when it doesn't perform that well, then we ask, what's wrong here? Why is it doing so poorly? So in terms of Vogel, here's the story. In the US the nuclear industry, the nuclear construction industry fell apart. Contractors kept the same name, but everybody who worked there knew how to run a nuclear plant site, construction site. They left. A design for a nuclear plant was created. That design was an evolution of another design. But that other design, that first design was never created. So you had Westinghouse come up with a reactor that it never built. It changed the design to make it even harder to build, and then without having the design completely finished, they started construction. That is not a recipe for success anywhere in any industry. And in nuclear, it was particularly bad when these subcontractors who got the contracts for Westinghouse, they could not deliver. A lot of marketing terms were used. This was an advanced reactor, and it was advanced because it uses 80% less concrete and a similar percent less steel and moving parts compared to previous generations. But that doesn't matter. If you're on your critical path in the construction site, you're stuck on one thing for a year. It doesn't matter whether there's, there's 80% less concrete, if it's easy to pour concrete. And that wasn't your problem. The materials usage was not the thing that needed to be corrected from previous generations. It was work site productivity, labor productivity on the work site. And when you have thousands of workers waiting around because something isn't right and you don't know what, how to proceed, and if you proceed, you might have to rework. That's what starts to lead to the, I believe at this point, 2006 years over time and something like 150% over budget. Something along there we can discuss and get the numbers. Exactly. So at Vogel, you had people working on nuclear for the very first time and learning the hard way how to do it and how not to do it. Eventually, once Westinghouse's subcontractors all collapsed, well, they didn't collapse, did they? Westinghouse had to buy them because they were going to collapse. Then Westinghouse was left running a nuclear construction job, which it had never done. Westinghouse had always worked with a big construction firm, but it found itself out on its own. And eventually Westinghouse ran out of financial lease. It took to Sheba, its owner, into bankruptcy. And then finally to get the project done, they went to the last person you go to. They're the most expensive. You go to Bechtel. And even Bechtel has been having to relearn a lot of skills in order to finish those nuclear plants. There was a great deal of rework that's had to happen over the last few years where wires were not put in correctly, cables were not labeled and isolated correctly, which is one of the great principles of nuclear safety. Cables have to be separated so that a single fire or impact event can't cut a bunch of parallel safety systems because all the cables went through the same spot. All of this to say we've very expensively and painfully rebooted nuclear construction in the US in order for that to last, in order for that to matter, we would need to keep constructing. And now's the time where we're figuring out whether we will and who's going to be doing that building.
- [40:17]
B
Mark, I personally am convinced that nuclear has to be the way of the future. I think it is going to be the cleanest, safest, best way to generate electricity going forward. But one of my greatest frustrations is the people in the nuclear industry who are so completely dismissive of what are in some cases very legitimate safety problems and challenges that the industry has faced. A lot of these guys like to pretend that there's no problem, which is nonsense. One of the things I really respect about you is that you're willing to talk both sides of that story. But here's the rub. The perceived problems that most of the anti nuclear activists like to focus on are not not the real problems, which I know you're willing to discuss candidly. So let's take this in two parts. Let's start with the perceived problems and then move on to your own frank analysis of what the real problems are that face the industry. The three big strikes against nuclear as it's perceived by the public are number one, operational safety, particularly with respect to meltdown risk has happened in Fukushima and Three Mile island, number two, nuclear waste disposal, and number three, nuclear weapons proliferation. So let's take those one at a time, starting with operational safety of nuclear plant. Those concerns are usually focused on meltdown risk where the cooling pumps fail as happened at Fukushima, or something else goes wrong. And even after the nuclear chain reaction is shut down, the fuel is so hot that it melts down, creating an environmental disaster. After Chernobyl and Three Mile island, nuclear experts insisted that modern reactors simply didn't have this risk anymore because due to redundant systems design, it could never happen again. Then it happened again at Fukushima Daiichi, leaving the public untrusting of so called nuclear energy experts. So what's the real story Mark, on these operational safety risks?
- [42:10]
D
So one of the first things I have to tell people is that the way Chernobyl blew up is of a fundamentally different nature than the meltdowns at Three Mile island and even Fukushima Daiichi. And that those Three Mile island and Fukushima Daiichi events were slowly unfolding, relatively non energetic. So that even though hydrogen gas built up in Japan and blew the roofs off of the reactor containment buildings, nobody was hurt by shock or by impact, or by blast waves, or by radiation burns or exposure itself. So let's tackle Chernobyl first, the most violent and famous nuclear disaster in world history. Rather than talk about the very well covered and discussed accident, I want to talk about one of the lesser known things that changes the nature of what we think we know about Chernobyl. Chernobyl nuclear plant kept operating for 14 years. For the first three years after the accident, electricity output increased year after year after year to a new plant record. In believe it was 1998 or 1991. So all of the cleanup efforts, all of the refurbishing efforts to make sure that the other three reactors on the site didn't blow up as unit for the baby of the, of the, of the site had all of those efforts did not even interfere with higher electricity production at an operating workaday plant. Workers were going to work and running that nuclear plant and after four or five years, for the good of a newly independent country for Ukraine. So people sometimes claim when they hear this, they're like, well maybe they were forced to keep running. No, Ukraine as a matter of national interest, kept running one of their precious nuclear plants. It was one of the greatest assets available to them. The only reason that Chernobyl nuclear plant closed down in year 2000 is that pressure from Europe was so severe and the amount of money being offered to the Ukrainian government to shut down the power plant so great that they finally said okay. The president of Ukraine in 2000 said okay. And over the protests and disappointment of the workforce shut down the plant and turned it into a big cleanup project forever and ever big make work project in some ways reasonable environmental amelioration and other ways. And now I'm sure Ukraine would be very happy to have the electricity production. But as it is, other plants of the same design as Chernobyl are in operation in European Russia today, powering multi million person cities. So none of that was to excuse what happened at Chernobyl. Nor was it to say that we should build that reactor design again. Nor was it to say that our reactors are of that design. Just that even the world's worst nuclear disaster could not even shut down the industrial facility that was supposedly a dead zone forever and ever afterwards. So there's Chernobyl about Three Mile Island. Three Mile island was a meltdown that occurred to reactors that were as old as the ones that ended up melting down at Fukushima Daiichi. That's actually quite important. The reactors that suffered the meltdowns at Fukushima Daiichi were hit with an initiating event earthquake and tsunami that ended up killing 16,000 plus people. That was much greater than the the initiating event at the Rima island, which was nothing other than a faulty understanding of an existing valve that had gotten stuck. So there was no real initiating event of any sort at Three Mile Island. Just a faulty understanding, poorly trained crews, an incorrect response, and then melting one of the two reactors on site and the other reactor continuing in operation until being shut down by low gas prices in 2019. Whereas at Fukushima Daiichi a cataclysmic natural disaster hitting one of the most disaster prepared countries on earth, killing an enormous number of people, doing an immense amount of damage. And yet, because of the cultural fear of nuclear, our memory of that event has focused around the nuclear plant itself, where very few casualties were seen and where the environmental destruction was as much by the cleanup efforts around the plant as by the radiation itself. And it's not proper to second guess those cleanup efforts. They were clearly important to people, they were important symbolically, they were important to administrators who ordered them. The gathering up of a foot of topsoil from a vast area and putting it into plastic bags and giant open air dumps. I think it must have made them feel better, or hopefully it did, because they did it. But looking at Fukushima Daiichi, Japan had a terrible nuclear safety record. For decades before that event, they had had very lethal accidents in nuclear plants with broken pipes, leaking steam into break rooms and killing workers. There had been issues with untrained workers or improperly trained workers at a fuel reprocessing plant suffering fatal radiation doses from an accident. Like Japan was not the model of good reactor operation. Japan had one of the worst reactor up times in the world. That is Japanese reactors were down for repairs or for checks or for refueling more than reactors in similar countries. These are all signs of a safety culture that isn't up to snuff. And it finally, it finally came to a head when at Fukushima Daiichi, the seawall that they knew was too low had not been raised. Then generators that General Electric had told the Japanese should be on higher ground were not put on higher ground. These are the generators where if a giant cataclysmic event knocks out your entire society, these generators will step in and provide the backup cooling to keep water on this still hot fuel, giving it time to cool down and lower the the danger. Yeah, those reactors were flooded by water. And then because of the huge amount of damage all around the plant and the cultural sensitivity of nuclear, the chain of command and dealing with the incident and the ability of workers and managers to communicate with the outside world was so compromised that in that fog, some bad decisions were made and the some of the oldest reactors in the west suffered meltdowns. So all of that to say every reactor on planet Earth that has stayed in operation has learned important lessons and has undergone emergency training and stress tests based on what happened at Fukushima Daiichi, 911 was a horrible event on 912 and all the days after that, cockpits got locked and hijackings effectively Stopped. It would have been amazing if we hadn't have had 3,000 deaths and that atrocity in order to learn to lock cockpits. But now they're locked and it changes the nature of danger and safety in airline security. And there's a phrase that you see in various branches of engineering, Eric, which is, well, in this case, I was down in a uranium mine this summer in Saskatchewan and I went into refuge room. It's like a combination lunch area, meeting point and life support room. If something were to go wrong and a collapse happened in the mine or a fire happened a thousand feet below the surface in this break room, the biggest words in the room, we're covering almost an entire dry erase board. The mine code is written in blood. The mine safety code in Canada is written in, in blood. Well, unfortunately, that's the way a lot of engineering works. It is shocking that the Fukushima Daiichi triple meltdown hydrogen blasts and, and fear did not lead to actual people dying from nuclear so much as it led to people dying from the panicked response to nuclear. To a lot of people, that's a difference without a distinction. But I think in the end that's why I'm putting this set of famous occurrences in the perception rather than the actual, the actual problems with nuclear that I see. If people were to discover they like nuclear, we accept risks we think are worth it. As people are discovering nuclear and deciding they like it, it's becoming easier and easier to learn enough about history's nuclear accidents to see what would be different about their own local nuclear plant in the case of a radically different design like Chernobyl or a very different safety environment like post Fukushima Daiichi. And that has been enough for the people that I've talked to to relax and stop worrying so much about the nuclear plant. I want to make one more comment though, on the safety and perception issue. I think a lot of people believe that even if nuclear regulation is too harsh in some countries, that regulation keeps us safe because it keeps nuclear plants on their toes. Maybe, but it's not the regulators that I feel have the most respect and fear in the minds of nuclear plant managers when I visit them around the world. Instead, it's WANO and impo. WANO is the World association of Nuclear Operators. So WANO is a voluntary association where it would look be a very bad look if you didn't join. Why? Because it's the top nuclear experts from around the world. Russian experts, Chinese experts, American experts, British experts, French experts, and you invite these experts into your plant, they look at everything top to bottom. They completely turn you over and then they leave, say thank you and they write a report to your owners saying here's what was good, here's what was bad, here's what is critically deficient and needs to be fixed. I have talked to a nuclear plant that had been going through years of reforms after a blistering wanna report was given to their owners. A report so bad evidently that there was a consideration of maybe shutting down the plant instead. Lots of people were shuffled around, some people were retired hard asses came in from other industries that are as dangerous or more even if the public doesn't realize it. And then reform happened and the nuclear plant then got glowing reviews on subsequent safety visits. That has nothing to do with the regulators so much. It's the self regulation and cooperation, the peer pressure of the nuclear industry itself that does come out of this perception that a nuclear meltdown from a rotten safety culture like pre Fukushima Daiichi Japan can destroy nuclear businesses on the other side of the globe. Everybody has skin in the game, everybody's in it together. Whether it's Rose Adam under, under Putin or it's, you know, a privately owned nuclear operating company in the northeast of the US that only has one plant. Everybody, for better or worse, is in it together to solve this perception of safety by actually making it to where nobody dies in a nuclear plant ever again.
- [54:02]
B
Mark, let's move on to the topic of nuclear waste disposal. Many of us have images in our minds of the so called Superfund cleanup sites where 55 gallon drums of incredibly toxic chemicals were discovered buried underground in these landfills. And after a few years the steel drums rusted through and the toxic chemicals leaked out, went down and polluted the water table, poisoning entire populations of people, we're told. Then you start with that image in your head of a thin steel walled 55 gallon drum buried in a landfill. And then we're told that this nuclear waste stuff can stay radioactive literally for millions of years. And that leads a lot of people to just question, well, you know, how long before the 55 gallon drum that that's buried in rusts through and it leaks out and something goes wrong? More recently, fears have arisen that spent nuclear fuel could be stolen from nuclear waste storage facilities and used by terrorists to make dirty bombs that could render a small city completely uninhabitable due to radioactive nuclear waste being splattered all over the countryside. So what's the story on waste disposal?
- [55:18]
D
So first I have to talk about those 55 gallon drums highly radioactive nuclear waste does not sit in those. Highly radioactive nuclear waste sits in containers so thick, so strong, so sturdy that specialized ultra strong machines are required to move them. And I have personally gone and hugged, put my arms around and put my body next to these giant nuclear waste containers while holding a high end dosimeter on my, on my core, over my heart, and have gotten no dose like not even a registerable amount of radiation. So the 55 gallon drums are a favorite of stock photos and of immoral publishers at newspapers because they they're bright yellow and they can scare. But in reality those don't exist, or where they do, they are used to contain radioactive waste so harmless that it is an actual moral and engineering question whether they should be counted officially as radioactive waste at all. Certainly they're often less radioactive than chemical wastes that are not considered radioactive in other industries like coal tailings or other mine tailings. So the drums we we've dispensed with in terms of the, this being in the perception category rather than the real category, I think itself is quite perceptive of you, Eric, because the nuclear waste itself, when handled properly, which it has been almost continuously in the history of civilian nuclear energy, has not caused any deaths or injuries ever. With one of the only possible edge cases being the safety culture issue at the nuclear fuel reprocessing plant in Japan where a poorly trained worker undergoing a bad process hurt himself and died from radiation exposure. So unprocessed nuclear waste has not harmed anyone, nor has there really been allegations of such, real or not. That's because there's almost no access to this waste by civilians. And so people who are against it often don't even know what it looks like or how to describe it, or how to even start explaining to people their physical fears. It's a phantom fear for this reason that if you ask somebody who doesn't like nuclear waste to describe for you what nuclear waste looks like and what form it takes, 99 times out of 100 they will struggle severely, need to consult sources, and suddenly be confronted for the first time ever that nuclear waste is not in a 55 gallon yellow barrel with a nuclear symbol on it. Let's talk about two approaches to waste handling that I've seen in my, in my time so far. One, each nuclear plant in the US has some area on site with large concrete drums that are about, oh, I'd say they're about 12 to 16ft tall. And inside of each of these is a thick steel canister, and inside of that are several spent fuel Bundles that have spent, I'd say four to five years in a reactor, followed by four to seven years in a spent fuel pool. Just getting cooler and cooler and cooler. Slightly heating up that water inside the nuclear plant in the pool, but just very easy to cool. You could get a bucket and keep, keep water covering those in the event of a, of an emergency loss of power. So it's a very low energy crisis if you lose all power and have to refill the spent fuel pool. Now that was one of the greatest fears in the aftermath of the 311 events over at Fukushima Daiichi. There was panic around the world that these spent fuel pools that needed to be replenished would boil off and the nuclear waste would spontaneously heat up and catch fire and it would pollute everything down to Tokyo and would cause millions of deaths for mass evacuation. That was bullshit. It was always bullshit. And this gets us to the 1 million years of radiation. Eric, if something is radioactive for a million years, it's not very radioactive. Something you have to be scared of are things with a half life of minutes, days, hours, weeks, or even a few years that can be very dangerous. That means you have something breaking down extremely quickly and therefore putting out radiation. If somebody claims to be scared of millionaire radiation, it means you're dealing with somebody who does not have a concept of what radiation means, of what radioactive decay means. And they are likely to be walking around granite buildings with radiation as high as about, you know, the last six or seven hundred thousand years of that radioactive decay that they claim to be afraid of. And that they're encountering that by walking around, say, high altitude environments, taking a flight, walking next to granite buildings. And yet they claim that that same level of radiation that they would experience walking next to granite would be their fear for hundreds of thousands of years. And that it needs special warning that demonstrates you're talking to somebody who you do not share a physical understanding with yet. And either you need to gain a spiritual understanding that makes them feel better, or you need to slowly explain the physics. Either way, you're not dealing with somebody who's scared of nuclear waste, the reality, but instead nuclear waste, the perception. So what are we going to do about it? For me, there's one important way forward. Call it the Dutch solution or going Dutch with waste. Perhaps if we're going to, we're going to say it with a smile. So Netherlands has one reactor. It's not too big, it would be called an SMR Small Modular Reactor if it were made today. But it is a German designed reactor, a Siemens, and I visited it. I've gone inside containment during operation. It's a little gym. It's absolutely fantastic. And they run a great facility, the Dutch. They even have really cool work clothes. They're bright orange and they fit quite well as opposed to many of the shift clothes that they have in American plants that are baggy and just a terrible look. So the Dutch look good while making nuclear energy out of a beautiful reactor. What do they do with the waste? After a few years in the reactor and a few years in the spent fuel pool, they send the waste packaged up in an impenetrably strong container over to France where in a large facility, France recycles the waste. What does that mean? They open the travel container, they pull out the waste, they chop it up to get the fuel inside, the, the fuel rods out, they dissolve it in acid. They then use a chemical process to separate out the uranium and the plutonium and the fission products. What are fission products? Those are the smaller particles, particles much smaller than uranium and plutonium that come from breaking apart uranium as the reactor operates. So these fission particles tend to be much more radioactive than the uranium plutonium that they're separated from. These highly radioactive fission products are then put in a glass block in a glass cylinder that's packaged up and that's returned to the Dutch. So fission products are not going to be radioactive for a million years. They're going to be highly radioactive for a few hundred years. The fission products are then put in these tall columns in a very large, strong concrete building that is then painted beautifully and opened up to school kids so they can go on science tours. That's right. The Dutch have made a museum touring experience out of their nuclear waste storage. They have put a fantastic museum up front where they have examples of radioactive consumer products that used to be made before the nuclear era dawned. Radioactive medicines, radioactive plates, radioactive scientific instruments. Then my favorite part of the museum tour, they have a cloud chamber where they show you the fabric of the universe in front of your very eyes. You see cosmic rays shooting through. In a dark room, you're looking into this glass cube where you can see, because of the illumination in the cube making any bubbles that happen to come in that cube show up. Cosmic rays shooting through cause condensation. They cause a little bit of bubble in the container and makes little droplets. And you can see cosmic rays going through your body, through the cube and into your friend. You can see much fatter. Globs of bubbles come from larger, higher energy particles breaking apart from Say if you put a thorium lantern mantle in, you can see the radiation popping off. So they're able to instruct in alpha, beta and gamma radiation, the three main types that you're dealing with when you're protecting against nuclear waste. And then after showing children in front of their own eyes the actual radiation popping off in the universe and off of consumer products, then they take everybody and tour you through the facility itself, showing you the protection against the radiation that they showed you in front of your face in the museum. It's a stunning display. Oh, and they have, they have radiation counters. For those who want them, you can wear them. Those who don't care, you don't have to wear them. And on this tour you see how they handle low level, medium level, and finally, most fascinatingly, the high level nuclear waste. In this high level nuclear waste facility, there's a three foot thick door that slowly rolls open. Then you climb over some steps and you can see down this long hall all of these circles in the ground. These circles in the ground are the lids above the columns of nuclear waste. If you put your hand on the red painted floor around them, you feel heat rising up from the floor, just from the hot air, circling through naturally into the building and out the out the stacks above that cool this nuclear waste. So the Dutch technique does not stop there. The Dutch approach does not. Just doesn't stop there. The Dutch approach is a social, ongoing process where every 20 years or so they're going to hold key meetings to see what the public thinks and what scientific experts think about the next step. What's the next step? Oh, well, maybe they'll bury it in the ground if people want to. It'd be expensive. Maybe they will, maybe they won't. Depends on what people want. But they show every day the active protection of health and safety within. An entertaining, fascinating pro nuclear energy tour.
- [66:41]
B
Reminds me of a Saturday Night Live skit. Daddy, Daddy, what's that big building? Well, that's the nuclear waste facility and mommy says no, actually, that's a theme park for kids. Wait, it's both a nuclear waste facility and a theme park for kids. It's fascinating that they've taken that approach towards education. Mark, there's a distinction that I just learned this morning from a Twitter thread that you sent me, which I think is for me at least, was really the breakthrough in understanding this. Let's talk about the high level nuclear waste that comes directly out of the reactor, out of the cooling pool in the reactor building. That's known as high level waste. And it is very dangerous to human beings when it comes out of the pool. That's a fact. We don't want to deny that fact. Another fact is that that stuff stays radioactive for millions of years and that's what freaks everybody out. The thing they don't tell you at the anti nuclear rally is what about after 50? The first 50 of those millions of years have gone by. How dangerous is it to humans at that point? And for the remaining 999 million years, you know, minus 50, whatever the total.
- [67:54]
D
Half life is after 50, you would have to work quite hard and get access to unshielded waste to get injured. Which I mean, if, depending on how you want to think about it, if you are inclined to fight nuclear energy for any reason and you are looking for an excuse, that would be your way of saying, well, that proves we can't, we shouldn't do it. If you are actually curious about nuclear waste, it's relatively relative danger and you can accept that we protected people against this 10, 20, 50 or nuclear waste now in the first 70 years of the, of the nuclear era, and that there's no indication it's getting any worse, and that the quantity of energy we get from each bit of nuclear waste is extreme. Each individual person's share of that high level waste that's still dangerous if unshielded at 50 years is so small to take care of all of their energy needs that you almost have to be working on ignorance or bad faith to say that a tiny amount of fuel that if shielded even a bit at 50 years protects people. That that's unacceptable for everyone else who's able to see a danger or understand a danger and then accept it. I think that learning the actual level of danger at 50 years and seeing that we've successfully, even easily protected people from that without having to build any giant underground repositories yet. That should be a big confidence builder for people in nuclear for the future.
- [69:31]
B
The point I just want to make sure is clear to our listeners is after the first 50 years of those millions and millions of years that you hear, about 99% of the radioactive decay is over and done with. There's only 1% left at that point. So although it is true that it stays radioactive for millions of years, the amount of time that it needs to be stored to get it down to the level where it's no more dangerous than, you know, any other kind of waste from a chemical process is not millions of years. It's more like 50 years.
- [70:06]
D
Except can I put in A good word for the waste. The radioactivity itself acts as a characterizing warning sign. It tells you what's in there with either in cheap, easily available handheld measuring devices. Chemical wastes are often much more difficult to detect or understand as a danger. Nuclear waste has a self advertising property to it where you can't have the radiation happening without being able to detect the radiation, if that makes sense. It tells on itself, as the kids might say. That's a very special attribute of this small level, small amount of high level waste that's actually there. The high level waste is 1% or so of the total nuclear waste while being above 90% of the total radioactivity. That means the amount that's dangerous is small enough to easily handle with reasonable budgets obtained from very light taxation of nuclear plants as they operate.
- [71:08]
B
Let's move on to nuclear weapons proliferation risk. The nuclear industry is fond of pointing out that the low enriched uranium fuel used in power generation could never be used to make an atomic bomb, which is true. But I think it really misses the point. The argument that's been made by critics is that once a country has the centrifuges that are needed to make low enriched nuclear power plant fuel, it's not too hard to spin those same centrifuges a little bit longer to make, or a lot longer actually in order to make weapons grade uranium. And still another argument is that a byproduct of the nuclear power generation chain reaction is that it creates plutonium 239 which could be concentrated into pure form in order to make weapons grade plutonium for a atomic bomb. So what's the story on proliferation risk risks?
- [71:59]
D
Nuclear waste is not a good source of proliferation risk. For one, countries are in two categories, those with nuclear weapons and those without. Within the nuclear weapons category. Of these nine, there are those who are the original havers of nuclear weapons, which means they're in a special kids club. They get to eat at the adults table. They do not have to undergo inspections of their facilities for proliferation reasons. Instead they are the ones that help undertake the inspections of everybody else's facilities, those who don't have weapons. Now of the countries that have that centrifuge technology, almost all of them are ones with nuclear weapons. One of the only cases where this isn't true is Iran, which is why we hear about Iran on the news and have for a decade now they have centrifuges. They say it's their right to have them under international anti proliferation law, which is technically true. But then they, they do not want so many inspections and they want the ability to have the material such that that extra spinning time you talked about, that extra centrifuge time is as short as possible to make material that could plausibly then be used in nuclear weapons. So Iran is at the center of this argument, but there's such a limit on countries having an excuse for these enrichment devices and access to them that that's what makes Iran a special case. Other countries that proliferated tend to do it without enrichment. Instead, they used fuel coming out of very specific reactors, not power reactors, reactors designed to produce fuel for nuclear weapons. Or alternatively reactors not built for power but for research purposes that were abused to make material for nuclear weapons. This all should indicate there's a relatively weak connection between nuclear infrastructure for civilian power and the choice to proliferate, which often doesn't even use the same equipment. I will argue in defense of the people, the anti nuclear folks who are say they're worried about proliferation. Administrators, scientists and engineers sophisticated enough to run a nuclear energy program are likely to be sophisticated enough to, if the desire is great enough, work towards a nuclear weapons program. Here's another way to put it. Almost every single country that has nuclear energy worked on a nuclear proliferation program at the same time that they built their plants. So countries like Sweden or Spain or Finland, all of these countries got nuclear reactors during a period when they were also working on nuclear bomb projects. The vast majority of them gave up the nuclear bomb projects while keeping the nuclear energy. That's a, that's a perhaps an issue for a longer discussion. And the reason I'm saying all that is because the urge to protect oneself, to protect one's economy from manipulation, from trade, blockades of fuels, to protect oneself in the case of war, those are similar instincts. And it's not clear that the nuclear energy is the path towards the desire for the nuclear bomb, rather that the desire to protect one's home and hearth leads one towards nuclear technologies, even if there are very different paths towards the defense and the civilian energy. The desire, the feeling so safe that you don't have to protect yourself with either nuclear energy or nuclear bombs, leads to a Europe where America's protection of nuclear bombs over Europe led to an environment so safe that not only did countries give up their nuclear weapons program, which of course reduced proliferation, but they eventually gave up their own energy supplies and got natural gas from Russia instead, completely forgetting any good sense of history, of self preservation or of being good neighbors. So I don't know exactly whether you can say that no There will never be nuclear proliferation ever again in world history. Just that a feeling of security leads to countries maybe not wanting nuclear energy or weapons. And a feeling of insecurity can induce directions towards both. The overlap between the two is the weakest part.
- [76:43]
B
We've covered the perceived risks of nuclear technology. Mark. Let's move on now to the actual real risks that you perceive to exist. Even though the anti nuclear lobby is not talking about them, it is a.
- [76:57]
D
Fundamental fact that nuclear energy takes a lot of talented people cooperating over long periods. If there's not enough talent people, talented people. If there's not enough trust and cooperation, if there isn't excellence to be had in either government or private industry, then nuclear is just maybe too hard to do and countries are not going to be able to do it. They'll get whatever you get if you don't get nuclear, but they won't get nuclear because it's too hard. An example I'm thinking of as I sit here in downtown San Francisco. Construction projects in San Francisco are chaotic wrecks. Things like putting in a bus lane can take 10, 15 years and hundreds of millions of dollars. Putting in a bus lane and making it red, putting in signaling lights, that can lead to hundreds of millions of costs and a 15 year process to get it done. One of the classic examples people bring up is that Golden Gate Bridge, one of the masterpieces of engineering in all of world history, both in terms of beauty, utility and design excellence, only took a few years. Came in on time and on budget for an inflation adjusted cost of a few hundred million dollars during the Depression. So they did it without computers and they did it without cell phones. And the project broke new grounds in worker safety. The guy who led the project, he wasn't brilliant at designing bridges, but he found brilliant people. But he was brilliant in pushing for worker safety and building a net that caught workers as they fell. There were almost no casualties on that bridge. Extremely unusual for construction projects at that time in America and even would be unusual even in some countries for large construction projects today. So how did we go from being able to build that bridge so quickly and so well to construction projects of any type taking an extremely long time and having risks of not being ever completed? That is something nuclear will have to deal with. No matter whether you have SMRs or you have small reactors or large reactors. If you claim your reactor is going to be built in a factory and shipped to site, every different design is going to have its own challenges and will require talent, excellence, some amount of patience and courage. To get going after our existing construction projects have been so far behind. Nuclear involves people, it involves trust. Nuclear is as big as society. If you cannot ask anything of society and you cannot count on society, it may become difficult to count on nuclear.
- [79:41]
B
Mark, are there any other real problems that we need to understand relative to nuclear?
- [79:46]
D
Yes, there are some countries building renewables so quickly that the business model of building nuclear on the grid may be itself disrupted without actually leading to a good outcome for the grid if the nuclear isn't there. So, for example, there's a claim now that there is no such thing as baseload energy needs because we have power plants that deliver energy from the wind or from the sun, and they deliver whenever they want. And because they've already been built or they're so cheap, we're going to keep building them. Any power plants that get built to deal with the gaps in the solar and wind must have a self sustaining business model that works around the solar and wind. So the claim is perhaps that natural gas turbines, where most of the cost of running a natural gas turbine is the gas you burn itself. And therefore, if you don't burn gas by turning the turbine down because the wind and the sun are high at the moment, that it doesn't destroy the economics of that gas plant as badly as it would a nuclear plant. Because almost none of the cost of running a nuclear plant is the fuel, then turning down a nuclear plant barely saves fuel, and it saves almost none of the costs of running a nuclear plant. So it's hard to imagine that a nuclear plant can be requested to turn off repeatedly for other energy sources and still stay in business. However, if the nuclear power is so valuable in the times that wind and solar are not producing, sometimes across entire continents or hemispheres at a time, then the nuclear plant may have a business justification. So long as a new technology that provides enough of the advantages of nuclear does not arise. So one of the technologies that people have spotted coming is from a company called Net Power. They have a revolutionary type of natural gas turbine that operates in a different fashion from existing turbines. It takes in natural gas into the turbine, into an environment of concentrated CO2. It burns the methane, the natural gas within that CO2 environment, and just creates a bit more CO2. The turbine spins efficiently, makes power, and then you just bleed off extra CO2 into a pipeline at a high purity and that's your waste product. So a natural gas turbine like this actually working well, and providing you have a way to use that CO2 or take it away or deposit it in the earth with high assurance that could give countries who simply do not want to entertain the thought of nuclear or have gone so far down the business path of intermittent wind and solar that they cannot justify nuclear for the time being. It may give a path around nuclear for those places that are able to make those turbines work and are able to dispose of the CO2. And crucially, we must mention, in the middle of a global natural gas crunch can get the natural gas needed for the hours of the year, for the chunks of the year where wind and solar isn't sufficient for needs. And then there's one more, one more way I see nuclear going very badly. If we have so thoroughly damaged our energy supplies, which had been steadily growing and growing and growing and growing for 100, 150 years, if we've damaged our energy supplies in such a way that we damage our wealth and the societal complexity that you mentioned so eloquently in your, in your opening era, then we may not be rich enough for the upfront costs of doing nuclear. And like a parent sitting on an airplane that is not able to get their own gas mask on before helping a child, if the rich countries don't have the capital to help themselves, they may not ever have the capital to help poorer countries develop. Rich countries got rich on coal, oil, nuclear and hydrogen. If we have denied all those things to poor countries and therefore and do not put our own gas mask on, our own oxygen mask on soon enough, we do not secure our own source of abundant wealth by building energy like nuclear. It may be that nuclear has less of a future because we and complex society has less of a future. Some issues I'm not simply not concerned about is the quantity of uranium or plutonium or thorium. Those materials are present in our Earth in such a quantity and we need so little of it to run a large nuclear plant, that the exploration and finding of new uranium will be sufficient to run nuclear plants for an extremely long time, even if that nuclear fleet expands to cover much of the world's needs.
- [84:35]
B
Mark, something that occurred to me as you were speaking that I think is really important to understand. First of all, my thesis of how this is going to go down is I don't think we ever get to nuclear energy until we get to the point where there simply is no other viable alternative. And that's not because it's not a good choice. It's because, unfortunately, there's so much fear and emotion in the system that I just don't think that public policy or public sentiment is going to be willing to accept nuclear until we get into the energy crisis that I think is coming as soon as the recession that's about to start is over. And as you point out, there's a risk that we get into this situation where the recession is so bad that it's difficult to make that investment in nuclear. But I want to also put this in perspective in terms of time. I think that we're going to get to the realization that, oh my gosh, we've got a real energy crisis. We're going to have to really invest quickly in trying to increase our, our oil and gas production capability, but it's still not going to be enough. We're going to need nuclear and we're going to need it right now. And the problem is you can't have nuclear right now. You can make a decision to make a strategic investment in nuclear power as the future, and then it takes about 20 years to build it out before it's really a solution. Is there anything that we can do in order to have nuclear be more helpful sooner? Because, frankly, once we get to the energy crisis that I think is coming, we're going to need a solution that's within, you know, a year or two, not within a decade or two.
- [86:13]
D
Well, I think of a, of a poem from the 1800s where there's a line for all sad words of tongue or pin. The saddest are these. It might have been. It is maddening to watch videos of Liberal Democratic Party leader Nicholas Clegg from the UK, who entered government with the Tories back, you know, 12 years ago in 2010, I believe, who claims, and you can see these on videos, that you shouldn't build nuclear because it won't be available until perhaps 2022. Well, the UK has a horrible energy crisis now here in 2022. It was more or less okay on energy for the first half of 2021, and they had more than enough energy in 2020. So in two years that comment has gone from looking decent to being a farce, and a dangerous one at that. So I think it is interesting that nuclear does take time and in terms of surviving, surviving a severe drawdown in energy supplies in order to come back later with nuclear. I think it will be possible and that maybe that's a little bit more optimistic than I was before. I think watching the degree that people who have to suffer, can suffer in Ukraine and surrounding countries to make it through this war of invasion from Russia, I think people have a capacity to suffer that's much higher than we might Give them credit for if they know why they're suffering and they see a light at the end of the tunnel. I think nuclear will have the ability to give hope that even if there's turmoil and hardship and anger at deprivations from the energy crisis, one thing that will provide hope and political consensus in countries otherwise torn by disagreement will be the need to move towards nuclear. Will that lead to projects in every country? No. But in the countries that do get nuclear progress, prosperity will be restored faster than those that don't. And the rewards of getting a nuclear plant project off the ground will increase and it will increase the relative disparity between countries that do make the decision to move towards nuclear and those that don't. We're going to see a wave of of countries that started nuclear before this crisis get their nuclear plants. They will be very splashy, turning on moments. COP28 the climate conference next year in the UAE will heavily feature that country's now long sided prescient nuclear energy program. One that was attacked by many people in foreign press who were claiming that UAE just wanted a nuclear plan for strategic reasons. Or maybe they were working on a weapons program or maybe they're trying to get an edge over neighbors. Whatever it is, that program was started on the right time and is being completed in a timely fashion. And it will serve as a beacon of hope to other leaders in the world who are going to come into power after those governments that ushered in the energy crisis fall. So a little bit of cynicism and pessimism and optimism mixed together. Eric. But I think that after uae, as countries like Turkey and Bangladesh and a few others bring online their Russian reactors, it will become abundantly clear to the non Russian world that to be on the same level, to be able to offer something to countries that are getting those reactors from Russia, it will not be enough to make moral statements against Russia. You'll have to provide excellent nuclear products yourself. And that will lead to a push of those countries getting the same at home.
- [90:06]
B
Mark, we spoke earlier about the problem or perceived problem that nuclear waste poses. I want to return to the nuclear waste topic now, but from a completely different perspective. And that's the perspective of opportunity. There's a new process or relatively new process that the whole industry understands. But, but to my understanding at least so far, only the Russians have actually demonstrated and proven it in practice. The gist of it is that all of the spent fuel that's in storage from the last 50 plus years, or I guess it's 70 or so years of nuclear power plant operation around the world, all of that spent fuel isn't really spent. Somewhere between 1 and 10% of the energy in that fuel actually got spent in those early generation reactors that are not very efficient. At least 90% of the energy is still in the fuel and it can effectively be recycled to make new fuel to power new reactors. Now, to my thinking, the profound benefit here is that it seems to me, from a PR perspective, from a public perception management perspective, you could roll out a plan that says we're going to bring on new nuclear power plants in order to meet the next 20 years of our energy needs. And in the process of doing that, not only are we not going to increase the total amount of nuclear waste storage globally by £1 over that period, but we're actually going to reduce it because these new generation reactors are going to burn a new kind of fuel, which is actually made by recycling the old fuel. But there's a downside to that, which is because if you've got the technology, so to speak, that you know how to run that recycling process that gives you the ability to transform spent nuclear waste into new nuclear fuel, then you probably also have the technology to turn it into weapons grade products. So that means you've got a proliferation risk. So this new process, to me sounds like it's a godsend if it stays in trustworthy hands and the bad guys are somehow never allowed to get a hold of it. But right now it sounds like the only people that are really leaders in this space just happen to be the Russians, which is kind of inconvenient for the west, given present foreign policy. So, Mark, please tell us the pros and cons of this new idea. Or maybe it's not that new, but the approach of recycling existing nuclear waste, both to get rid of it and to make new fuel so that we don't have to continue making more and more waste in more and more waste storage sites around the countryside.
- [92:46]
D
I'll have to introduce a new term here, fast reactor. Now, fast reactor is short for fast neutron reactor. And what the fast is referring to is that in these reactors you do not put in materials to slow down neutrons so that they collide with atoms of uranium at a slow speed. Now, there's some quantum weirdness here, but neutrons running into a uranium atom at a slow speed are actually more likely to split it than if they run into a uranium atom at a medium speed. Up at higher speeds, there's a, maybe not as high a chance of splitting, but higher chance of the splitting causing More neutrons to come out upon hitting any given uranium atomic, whether it's the type of uranium atom that's easier to split or harder. So all of that to say you can design your reactor to take advantage of the properties of extremely fast flying neutrons in the core. These fast neutrons can do things like hit uranium, bump it up to plutonium and then split that plutonium. Or you can hit thorium with a uranium, bump that thorium up to very briefly, protectinium, and then that protectinium naturally breaks down quite rapidly into uranium 233. And the next neutron that runs into that uranium 233 is pretty likely to split it into smaller bits and tons of energy. So these fast breeder reactors, so called because they breed more fuel, usable fuel, than what you put into them originally, are what Russia has developed out at one of their sites in Beloyarsk. Now, tons of countries were working on fast breeder reactors. Just off the top of my head here are countries that had operating fast breeder reactors. Usa, United Kingdom, France, I believe Germany may have had something at some point. Japan definitely did. India is building one of these facilities. China is building one of these facilities with Russian help. So it's something we've known has existed since the dawn of the nuclear era. One of the, one of the reactors that first, actually the reactor that first ever powered a light bulb string was one of these fast reactors and if fueled properly, could have bred more fuel in a sustainable way. Then it, it burned. Now the Russians have just started up their newest version of this reactor with a load of MOX fuel, MO X MOX fuel, mixed oxide. So this is plutonium and uranium from separated out processed nuclear waste that have gone into that reactor and will be run for a long period of time, making and using fuel as it goes. This is, you might say, the holy grail of energy on this earth for humans. If we're not able to get fusion to work, and potentially even if we do get fusion to work and it's just not a very effective way to make energy because it keeps shutting itself down or it's hard to maintain, or it's a pain in the ass. So fission running off of fast breeder reactors can be so light on our existing uranium resources, it can make use of our existing spent fuel, the material still in our spent fuel, that we can run the entire global economy off of nuclear energy from spent fuel for something between a few centuries to a few thousand years, if we have a total recycling process that squeezes all the good out of each bit of fuel coming out of these reactors and our existing fleet and putting them into these new reactors. You would probably need to switch to a reprocessing method that does not fully separate out uranium and plutonium. That would be best. Even if you did use recycled spent nuclear waste from today's reactors, the plutonium is not going to be super effective for high yield nuclear weapons. There's debate out there about whether you could make a little one that would pop and do a lot of the fear mongering and if that would have as much impact as a larger one that actually did have a bunch of explosive power. But the main point is countries that are attempting to proliferate would not optionally choose spent nuclear waste reprocessing as their path to do it. Even if they, if they had the facilities to do that, they would want to use specially made nuclear waste, specially operated reactors that are not the same as energy reactors. Having said all that, it is physically possible and eventually I would think necessary, and it's going to happen on this planet that we will run reactors with these ultra efficient, continually reprocessed fuel cycles. In which case you would not just get 1, 2, 3, 4, 5% of the energy out, you would get the proverbial 90, 95% or more energy out of each atom of mind. You're raining from the earth, Mark.
- [98:01]
B
One of the reasons that the 1970s nuclear energy buildout in the United States failed to deliver on the promise of making electricity cheaper is that large bespoke nuclear power plant construction projects were plagued by massive cost overruns. If you fast forward to today, as we discussed earlier, little has changed. The cost overruns on conventional nuclear reactor builds in the states of Georgia and South Carolina. Literally bankrupt Westinghouse in 2017. Westinghouse is the biggest manufacturer of most of the existing nuclear power plant fleet, necessitating its recent acquisition and bailout by Brookfield and Cameco. A lot of people are saying that the solution to these problems is to move away from conventional nuclear plants and focus instead on a trend known as SMRS for small modular nuclear reactors. The idea is that instead of building a gigantic gigawatt reactor like a Westinghouse AP1000 that has to be assembled on site in a gigantic public works project like Vogel in Georgia, you could instead design small modular reactors of say 100 megawatts of power generation capacity, which are built and tested in a factory and which fit in the form factor of a 40 foot shipping container. So if you need a thousand megawatt generation capacity, which would be equivalent Approximately of a Westinghouse AP1000. You just order 10 of these modular hundred megawatt units and they'd show up in the form of 10 shipping containers that show up on 10 trucks. You don't have a gigantic construction project. All you have to do is hook them up, wire them together and you've got your thousand megawatt or gigawatt power plant. A lot of people seem to think that SMRs are going to be all the rage and the way of the future. I was surprised to learn off the air that you're actually a skeptic of that sales pitch. So Mark, what's your take on both sides of this story? First, tell us about these SMRs, what they are, why other people think they're the way of the future, and then explain why you have reservations about that approach and actually favor conventional nuclear over SMRs.
- [100:06]
D
For most applications, SMR is a marketing term that does not guarantee whether a reactor is small or not, doesn't really guarantee whether it's seriously modular or not. And so therefore the blanket phrase SMR can hide products that are just very bad ideas, badly designed and would probably be badly implemented while making other reactors that are effectively going to lead the nuclear renaissance if it's going to happen, and make them look not as cool because they don't look as modular, they don't look as small or they. So let me give you an example. If you can build a large reactor quickly and effectively, that will probably make cheaper energy than a small modular reactor that is multiplied several times to make the same capacity. But we here in the west have mostly lost the ability to build such reactors. Now, we might have relearned enough lessons at Vogel that we could do some large ones, but. But if you wanted to get reactors from Koreans or the Chinese or the Russians, they will be able to sell you a reactor that is both large and built reasonably on time and on budget. Whereas they would probably advise you that smaller reactors, you'd better have a really good business reason, you don't need much power or your grid maybe isn't up to snuff because as they're capable of building large reactors, they themselves can see that the smaller ones are more expensive per unit energy over the longer run. Having said that, America needs to relearn how to build. And there are lessons and insights in shrinking reactors back down that may end up making higher quality construction projects, higher quality managed projects that lead to a resurgence nuclear building in the U.S. one of the fastest things that you would probably see is upsizing the Reactor core of those to make a little bit more power where that works. What you see is why we made the reactors larger in the first place. Why we went from reactors of 30 megawatts up to 300 megawatts and then to 1500 megawatts. Why did we do that from 1960 to 1980? Why did we continue to operate reactors? Because if you know how to build a plant, one of the easiest and fastest things to make more power is to just increase the diameter of the reactor just a little bit. And there's a sort of a cube power law that comes into play in the in making a higher power plant without making it much larger. And we would be doing that as soon as we learned how to make the small modular reactors. In fact, some of the most talked about smarts are as large or larger than the existing large reactors that were built back in the 70s. And you have to ask was were the ones in the 70s if we were to do that? Exactly. Again, would they count as SMRs? What exactly is it that makes it an SMR? Now you could say you build it in a factory, but almost no proposals from SMRs are that perfect vision. You see where it comes in individually packed packaged vessels. I am suspicious of anything claiming to be that small while that high power. That sounds to me like great compromises have been made somewhere in the engineering. But if people can make a strong case and show how they can do it safely, we'll see. The history of nuclear has been taking a little bit more space, a little bit more complexity, a little bit more effort, and finally more cost than you expected to. Just at the design level of the nuclear engineers working on a project. Does that make sense?
- [103:49]
B
Absolutely. So your take here is that SMRs are more marketing than reality.
- [103:56]
D
But with respect, know that the phrase is a dangerous marketing phrase that is used irresponsibly. But some of the projects, not all of them, some of the projects that will lead the resurgence of nuclear in the west are currently marketed as smart as next to other reactors that will not lead the resurgence in the US that will be unsuccessful business ventures. And that the biggest step is accepting that nuclear is worth exploring. And then the next step is putting together an appropriate project for the place that you're building it for the country that's undertaking it for the companies involved. That may or may not be an smr, and it may or may not be an smr. That's considered advanced versus old school, shall we say? One of the most promising SMRs, for example, is the General Electric Hitachi BWR X10 boiling water reactor. It is a relatively straightforward evolution of technology we already have today, of supply chains we already have today, and uses a straightforward evolution of the reactor safety case, the licensing safety case of plants that have already been given licenses to be built or even to operate. So it works with the society we have, it should work well with the industry we hope to rebuild. And that's not as assured for the more exotic or more, you might say, innovative reactor designs that people propose.
- [105:25]
B
Okay, so the message really is do your homework and don't get sucked in that just because it's small and modular, that makes it a good reactor. What about the idea of building the larger plant plants by creating modules in factories with high quality control and assembling them on site rather than actually building them on site?
- [105:44]
D
This is in fact the way we've built reactors for as long as we've been doing it. Russia has massive assembly lines where you can see a line of reactor vessels being formed and being prepared to ship to site. Russia can then choose between its many projects it has going simultaneously to make sure that optimal time to build is being achieved at each one by sending reactor vessels where they're needed most. I've even heard of examples where they've sent a reactor vessel to a site, they accidentally dropped the reactor vessel a few inches onto the ground, it spooked a customer, and the customer requested a new reactor vessel. And then they were able to change out the reactor vessels between projects and get them both installed into plants that are about to be turned off on. So that that is an interchangeability of parts that actually has been a feature of nuclear for a long time. It's just the construction management, the integration, the licensing and the societal pushback all combined in toxic ways to produce very slow construction and completion times for the last wave of reactors in the late 70s, 80s and early 90s in a lot of the West. In Japan actually. I know I've talked about the problems with the safety culture there, but in terms of construction, large modular reactors were created in the 90s and 36 months at existing plants. 1300 megawatt reactors built in 36 months from first concrete to turning on and first nuclear reaction, 48 months. When you include the time to enter full scale commercial power generation to sell electricity on the grid, that time would be considered very good by an SMR builder. Except the SMR builder is going to have a lot less power at the end of the construction. This doesn't mean we can skip SMRS here in the west. If we've gotten bad at building the large ones. I have to emphasize though, countries building nuclear programs that are life or death are choosing the plain old standard large reactors on sale from vendors who know how to build them or have recently built them. That doesn't mean that countries won't come to rely on the SMRs too. But countries faced with making ultra high stakes decisions that need the lowest amount of innovation, the least amount of risk in the product they're buying are choosing the reactors that SMR language is coded to attack.
- [108:18]
B
Mark let's move on now to a collection of topics known as Advanced nuclear the nuclear reactors built in the 1970s are known as light water reactors because they use what's essentially regular everyday water as the moderator for the nuclear chain reaction. Listeners who are interested to learn the function of a moderator in a nuclear fission reaction can refer to the resources that Mark discussed at the beginning of this interview, which are linked in your Research Roundup email. There are some newer and better designs known as heavy water reactors, molten salt cooled reactors, and liquid fuel molten salt reactors. But before we dive into those, let's first discuss what was wrong with those early generation light water reactors that had to be pressurized in order to operate the nuclear fission chain reaction at super high pressures. So what are the pitfalls of that approach and why do we need something different?
- [109:11]
D
Well Eric, nature abhors a vacuum and a relative vacuum is created when you have a highly pressurized bottle and a low pressure atmosphere. If you put too much heat in to a nuclear reactor under pressure and Elite develops, or somebody crashes a missile into an occupied nuclear plant or something like that, that a violent depressurization, that is water under heavy pressure bursting through a pipe and flashing into steam can disperse radioactive isotopes if they have already leaked into that water, if there's already been some fuel damage or a meltdown and be dispersed out into the atmosphere. The reason why these pressurized water reactors and boiling water reactors, which are another type of water reactor under pressure, have such strong containment domes is to contain within them the largest possible leak of pressurized water into this space under the containment dome. So the thought goes, if we use fluids, heat trans coolants and moderators in reactors that are not needing to be under severe pressure, then you remove an entire type of accident that comes from the interior of the reactors being at a higher pressure than the atmosphere. In which case you could dispense entirely. If you trust your engineering, you could dispense almost entirely with a tensile strength hardened pressure vessel and you can just have armor around the reactor just protecting from external objects crashing in. In fact, the thought that the Fukushima Daiichi design had enough of that protection around the reactor itself because of the low pressures inside. Relatively low pressures inside was part of what led to a somewhat weaker containment building that was then breached when there was a hydrogen explosion. So these are definitely things that you would look at step by step in a safety case for the reactor. But it is true that if you have a sodium cooled reactor and the sodium is at atmospheric pressures, even if it's at several hundred degrees C hotter than water, that is going to lead to different and possibly reduced maximum accidents compared to pressurized water reactors.
- [111:33]
B
Something I really found interesting, as I learned it recently, Mark, is the use of water as the moderator in the reactor. I mean, it seems to most normal people, like water is super safe stuff. We use it to put fires out with. And of course, you have to stop and remember the chemical formula for water. H2O, that's hydrogen and oxygen. Hydrogen is the very explosive gas that was in the Hindenburg. Oxygen is the stuff that makes everything burn hotter and faster. So, you know, the last thing you want is hydrogen and oxygen, which is an incredibly explosive combination. Well, water is obviously safe. It's not hydrogen and oxygen. It's a combination of those. Hydrogen and oxygen atoms are bonded together in a covalent bond that's so strong that nothing could break it apart short of, oh, say the neutron implosion of sustained nuclear reaction, which is exactly what's going on inside of a reactor. So what actually blew the roof off the top of the building at Fukushima Daiichi was when the water inside the reactor separated into hydrogen and oxygen and then exploded. So getting the water out of the or using something other than water as a moderator seems like a really good idea. What are the benefits of heavy water reactors and where are they used?
- [112:53]
D
Heavy water is water that has as its hydrogen atoms, chubby hydrogen deuterium, that is hydrogen that instead of just being a single proton and an electron, is a proton plus a neutron and neutrally charged particle just as heavy as the proton. So what happens here is that it's a little bit less likely to absorb stray neutrons, meaning it reflects those neutrons back into the reaction and is therefore it's, it's more stingy and less wasteful of the neutrons. This means you can run your reactor on lower radioactivity initial fuel. You can run heavy water reactors on natural uranium with none of the enrichment from the spinners that we were talking about earlier in the episode this means you can make a fuel cycle independent of one of the technologies that is mistrusted for its proliferation concerns.
- [113:49]
B
Okay, so if I don't want to let a country have the centrifuges, they could have heavy water reactors to make their electricity and they wouldn't need the centrifuges that might be abused. Used in order to make nuclear weapons.
- [114:01]
D
Correct. But there's no free lunch. Heavy water reactors as they exist today can be refueled without being turned off. That means you can put fuel into them as they operate continuously. This is a feature that could be abused to make materials that could be separated into uranium and plutonium later. So again, there's. There's no free lunch here. And there are advantages to be obtained by putting in enriched fuel into heavy water reactors. An innovative startup company that I've worked with out of Chicago, Illinois. Clean Core Thorium Energy is combining mainly thorium with a little bit of enriched uranium in order to make fuel for these heavy water reactors that keeps all the advantages of heavy water reactors, but uses seven times less fuel. Now, fuel is not one of the major cost components of a reactor, but if you have a drop in fuel replacement that saves a significant portion of the cost of the fuel over the 30 year life of one of those reactor cores, you could save up to $1 billion or more just from the changing out of the fuel alone. And if that's. If you can do that with a relatively quick development period and you obtain the enriched uranium to go in with the cheap, readily available thorium, then you make a fairly compelling case for using enriched uranium in reactors that were originally designed to not require them. Then if, if you're wanting to trust but verify that countries are not misusing their heavy water reactors for proliferation purposes, refueling the reactor seven times less will reveal if a country is starting to misuse the reactor and doing extra refueling. So you would be able to notice and monitor if extra refueling was being done and if that refueling was being done with fuel that wasn't the long lasting thorium uranium fuel. So pluses and minuses everywhere. Nuclear really is the death of easy narratives in many ways. You almost want to run screaming back to just the basics. Extreme energy density, ultra long lasting machines, almost all money to labor and operations rather than to materials harvested from the earth and steady safe power.
- [116:25]
B
Let's move on to the next one, which is the molten salt cooled reactor you described previously. Why it is beneficial to get the water out of the reactor so you're not using something that can separate into Hydrogen and oxygen instead, using melting salt essentially as the moderator for the nuclear reaction. What's the current status of molten salt cooled reactor development? Is this something that you can buy and use today and is it permitted by regulators?
- [116:55]
D
No, you cannot buy an off the shelf reactor of this type. Now, people cover a wide range of reactor designs and configurations with the phrase molten salt. Now I like the fact that molten salt can operate at extremely high temperatures. I get a little bit uneasy when people suggest melting and dissolving the fuel itself into this molten salt, because that takes one more barrier away between you and the atmosphere and your fuel and your fission products that are bouncing around in there by dissolving the structural integrity of the fuel form that would normally maintain all those fission products. So molten salt has this advantage. If you have any heat engine, any device like a power plant that operates at a hot temperature and puts out waste heat to a cold world, the maximum efficiency, the amount of useful work you can get out of the energy you put in, is limited by how hot the hottest temperature of your device is and how much work you're doing at those high temperatures before you get waste heat. The hotter a reactor is, the higher the efficiency of energy conversion in that reactor. If you want to run industries that require hot temperatures off of the pure BTUs, the pure energy coming out of these reactors, you will do best from an efficiency standpoint, and they're hopefully a cost standpoint. If the reactors operate well with having the highest possible temperatures for your heat transfer, that's going to come from molten salts. And it's not necessary to melt the fuel just to have the molten salt coolant. Those two things can be kept separate. And I think that's where I'm most excited about molten salt reactors, their potential for use in high heat environments. People can make arguments for wind and solar that I can accept, but one that I don't really care for is the idea that wind and solar are efficient because they don't have waste heat. But also we should use wind and solar for heat needing industries. No, if you don't have heat being generated, that is a disadvantage for using that heat for industry. Nuclear plants that can operate at very high temperatures and do it constantly will be superbly suited for decarbonizing currently impossible to decarbonize industries. I shouldn't say impossible, but here's the idea for wind and solar. To decarbonize some industries, you overbuild the wind and solar. When they're on, you convert some of that energy into hydrogen, then you store the hydrogen and transport the hydrogen and use that hydrogen burned at high temperatures for your industry. This involves so many energy conversions and so much loss. That is a preposterous proposal in many ways. However, if we can make these, although you can't order them off the shelf, there are companies in several countries working today on those molten salt reactors. There are companies in the United States and then there are experiments going on with molten salt reactors in China that are considered to be on the cutting edge.
- [120:17]
B
And I just want to put this in perspective for our investment centric audience, which is a lot of people seem to agree that molten salt reactors are kind of the cat's meow. It's really exciting stuff. It's a better way of doing things. However, the regulatory bureaucracy is apparently not ready to consider how they would regulate and how they would permit these things. So there's some companies doing really exciting research. Unfortunately, the investment play that says, let's build a company that's going to build all molten salt reactors and put them into production and deliver them and produce electricity with them next year, it's not happening and it's not likely to happen anytime soon. Is it just the United States or is it really everywhere that there's a regulatory barrier to the acceptance of this new kind of reactor? And I shouldn't say new kind, this very old design which is becoming repopularized.
- [121:08]
D
Well, it's yet to be seen what happens if countries come to nuclear. Under an environment of extreme enthusiasm at all levels of government society for nuclear, it is clear that the international community does have a say and does hold weight in how countries approach nuclear. For better or worse, nuclear is an internationally important industry and the opinion of countries around the world will matter, especially if those countries are providing financial support and regulatory support and technologies. They're going to want to know that a receiving country is using that. Well, some of the molten salt plays are coming out of Denmark, a sort of surprising location because of the famed wind energy program that supplies over half of Denmark's electricity each year. But that would be an example of Denmark suddenly getting excited about homegrown reactor technologies. And I think people will always feel more comfortable taking risks with something seen as their own. So although I don't think of the SMR plays that I've seen, that molten salt are going to be first to come out and they may not be as successful when they do, that's yet to be seen. I think that companies with crazy new ideas that are developing those within the culture of their homeland may end up being embraced and be given a more gentle regulatory touch than outside technologies that feel like they were invented elsewhere and therefore attract more scrutiny. In the past, America and other places have had reactor parks where almost anything that was reasonably safe could go. Reactors were built that were intentionally melted down just to see how they'd perform. Reactors were built of a crazy variety in America and put into commercial operation in this first eager age of nuclear energy in the 50s and 60s and early 70s. If we get back to that pioneering attitude, we may find that that reforming a regulator is enough to get faster progress on the more exotic and difficult to understand nuclear reactor processes. Molten salt fueled, molten salt cooled reactors would definitely fall into that category.
- [123:37]
B
Let's move on now and briefly touch on the nuclear fuel cycle. I want to save most of the detailed analysis of the economics of the fuel cycle from my interview with Justin Huhn now next week, since Justin and I plan to discuss the fuel cycle in great detail, including how investors can position themselves to benefit from trends like underfeeding giving way to overfeeding, which we'll explain in detail next week. But speaking to Justin off the air, he suggested that I ask you to just lay the groundwork by explaining a couple of concepts. Natural uranium comes out of the ground with less than 1% of it containing U235, the isotope that's actually useful to make nuclear reactor fuel. The rest of it is U238, which is not really useful for producing a nuclear chain reaction. In order to get to enriched nuclear fuel that runs a reactor, you've got to go through first a process called conversion, which turns that powdered uranium into a gas, and then it has to go through a process called enrichment. The conversion and enrichment processes are of particular, particular interest to investors because a lot of analysts think that those processes are going to become bottlenecks when demand for finished enriched uranium fuel products increases dramatically in coming years. So, Mark, please explain why conversion and enrichment are necessary and how those functions are performed.
- [125:00]
D
Today, the way most, almost all enrichment in the world works is that we use the difference in mass between U235 and U238. That is, U238 has a few more neutrons in it, which makes it a little bit chunkier and heavier. But to be able to split those two things apart, you need to put them in a gas form to allow the U235 and U238 to bounce around and migrate apart from each other. That's the separation that you're trying to achieve in order to get higher quantities, artificially higher quantities of U235. So you've got to turn the uranium into a gas gas. You do that by a few different chemical processes that are part of the fluorine industry, and you end up with uranium hexafluoride. That's a heavy gas with one uranium atom and 6 Fluorine gas atoms and one fat molecule. This gas is then spun at a very high rate of speed in centrifuges, and uranium 238 goes out a little bit more, uranium 235 goes in a little bit more, and that leads to a concentration gradient that allows you to suck out gas with a slightly higher amount of U235 in it. And then you do it again and again and again and again and again in what's called an enrichment cascade, until you have the concentration of uranium that you desire. So turning uranium into a gas is something that you need not too much of in the world, but if you don't have it, your enrichment comes to a halt quite quick. So it's essential, but not very economically valuable if there's even a little bit more than the amount you need in around the world. What's happened is that enough of that capacity was in Russia that losing that capacity from Russia puts us in a bit of a bind. We've got to stand up our own uranium hexafluoride conversion facilities quite quickly. Now. We do have facilities that were turned offline that can be put back into service. And around the world, governments have such an inspiration to get this done that it's don't want to say it's somebody else's problem, so it'll automatically happen. But it's a relatively small worry for me. Perhaps a bigger worry is the enrichment facilities itself. Enough of that enrichment facility capacity was located in Russia that if everybody suddenly needs to cut a new contract to replace their volumes that they were expecting to buy from Russia in the future, then we don't have quite enough enrichment for everybody to get it done at anywhere near the price that's available today. The question is, will there be actual shortages that lead to nuclear plants having big enough delays on fuel that they can't operate? I've queried people involved in the nuclear industry and they seem to say no, but they don't want to say no so loudly that we don't invest in the enrichment capacity. That solves the problem, if that makes sense. So, yes, quite essential, yes, somebody is going to collect economic rents for some time in this bottleneck. But it shouldn't be something that either is an argument against doing nuclear energy or that we cannot solve and will lead to shortages of nuclear electricity.
- [128:22]
B
Well, it's definitely an opportunity that I think about from an investment standpoint because I think there's complacency in the system where most people I'm talking to are saying, look, don't worry about being able to get the enrichment services from Russia because the people that are writing the sanctions understand we don't have that capability. We're not going to sanction an embargo. Russia, so it's not allowed to sell us any enrichment service services. We're smarter than that. And I sort of say, wait a minute, did you consider whether or not Vladimir Putin is smart enough to figure out that he could do some real damage by cutting us off from those services? So I don't know how much important revenue Russia derives from selling enrichment services to the west, but Russia certainly is in a position to withhold those services as an act of economic warfare if they did so. So as I understand it, we would be screwed. We would have a nuclear industry which does, as I understand it, have a fair amount of fuel stock. It's not like we're going to run out next month, but within a short number of years you would have to really build out a whole bunch of enrichment facilities. If you do it the old way, it means a lot of those high revolution speed centrifuges are needed. We'd have to build plants to do all that stuff in the West. There's also a new approach though, called laser enrichment. Is that a better way to do it? If we, if, let's imagine that we lost access to Russian enrichment services and had to replace that capacity, would we be better off to start building out a whole bunch of facilities full of centrifuges? Or is this new laser approach better way to do it?
- [130:05]
D
Well, the truth is laser enrichment has a few years to go. I've been told that the technology should be good to go. It does work at a small scale, but we need to commercialize it. America is the country that owns commercial laser technology. That laser technology needs about four years of really intense sprint development, or maybe double that of slow plotting development. If laser enrichment and the economic advantages that it could bring is considered important, either investors or government can work together to accelerate that development and get that laser enrichment going at commercial scales by perhaps late 2027, early 2028. If the money spigot turned on straight away. The expectation for centrifuge enrichments is A little bit sooner. And if you just pay the Europeans to expand their already existing technology, already existing plants, then they can get even higher certainty of increased capacity in short order. I think that's the way I'd put it.
- [131:12]
B
So it sounds like your preferred second source. If Russian enrichment services were just taken offline because of geopolitical developments, Europe is the second source to go to. They don't have enough capacity, but they do have the infrastructure. They just have to increase their capacity in order to be able to service the need.
- [131:29]
D
Right. And some of those European facilities aren't in Europe, they're in America. The Europeans own the main enrichment facility in the U.S. okay.
- [131:38]
B
And as I understand it, the play, if you're trying to bet as a stock investor on laser enrichment, is actually an Australian company, Silex Technologies.
- [131:47]
D
So that, that would be directly involving yourself in the enrichment technology. But the Silex technology is itself held in a cooperative structure called Global Laser Enrichment. That is a subsidiary of Cameco.
- [132:03]
B
Okay, so laser enrichment plays for investors are going to be Cameco or Silex, if you want a focused play.
- [132:08]
D
Correct. And one thing we didn't mention is that if you shove more natural uranium into these centrifuges and only squeeze them a little bit, then you can up your. You can up your amount of material coming out, but you have to use a lot more mined uranium. I would imagine Justin will thoroughly go over this next time.
- [132:28]
B
Yes, he definitely will. We have a plan to attack the fuel cycle in detail in next week's interview. Mark, I'd like to return now to the subject of that video that inspired you to pursue this career in the first place, and that was the use of. Of thorium rather than uranium to power nuclear power reactors. Thorium is four times more plentiful in the earth's crust than natural uranium. But more to the point, less than 1% of that natural uranium is U235, which is the kind of uranium that's useful for making nuclear reactor fuel. So by my reckoning, the effect is that there's 400 times more useful thorium than there is useful uranium. And what's more, the price of thorium is literally negative right now. Rare earth miners produce thorium as a byproduct and will literally pay you money to haul it away and take it off their hands because they have no use for it presently. Now, here's what, frankly, pisses me off, Mark. Every single knowledgeable investor in this space who I've consulted with has told me exactly the same thing about Thorium, and that includes people like nuclear hedge fund manager Mike Alkin and billionaire mining tycoon Robert Friedland. These are people who clearly know what they're talking about. And what they tell me is that thorium is every bit as exciting as guys like Kirk Sorensen make it out to be in terms of its potential. But then in the very next breath they tell me that I would be a fool to try to invest in it because regulators in the west are nowhere close to being ready to even consider permitting a thorium fueled reactor. Now China has a big program to develop thorium fueled reactors, but in the good old US of A. I'm told that even considering any fuel source other than uranium is basically just categorically out of the question. Unless there was a completely new government driven policy initiative where the government's driving the bus and making it the priority. And it sounds like that's not even remotely on their radar right now. So what's the straight scoop on thorium, Mark? Is it really the tragedy that I'm hearing in the sense that it could potentially change everything for the better? As Kirk Sorensen has said in his many videos, but the government is standing in the way of progress, or is there more to the story than that?
- [134:47]
D
The first commercial core we ran in, the first commercial reactor built in the US was a thorium fuel. Its performance just wasn't as good and it wasn't worth the effort. So they switched it out. We've had several countries run thorium fueled reactors. It's. There's nothing magic about thorium. You have to convert thorium into uranium to run your reactor in the first place. What's happening here is people are confusing thorium, the fuel, with their favored reactor type that they want, either for other reasons or because it's required in order to convert the thorium into uranium in order to burn it. So as an example, heavy water reactors can run off of a combination of thorium and high assay low enriched uranium, that is uranium that's higher enrichment than the 5% most commonly used today as the cutting edge PWR fuel, but lower than the 20% that's considered above that, that is considered an unacceptable proliferation risk. So if you combined high assay low enriched uranium, halu uranium, around 20%, a little bit of it, with thorium, without any real regulatory troubles, you can put that into heavy water reactors. I think that the thorium community has not focused on that. One, because they didn't realize that combination was possible, and two, because it wouldn't give them the sense of total all encompassing revolution that fits their narrative of what we're going to get from nuclear if we do it just right. So the idea that we've run off of run thorium reactors is not that welcome because it means that we should understand why we were using thorium. And then we stopped the idea of India having an entire national program oriented towards thorium and then seeing them sort of step away from that as soon as they get access to more uranium. That's important. We need to understand what is it people are getting out of nuclear and does that require thorium? Does it benefit from thorium? I think clean core thorium energy has made a clear business case that has been essentially accepted by Candu, by heavy water reactor operators, that there is value to be gained anywhere from 5 to 10% of the operation cost of these reactors, potentially of using a thorium plus hailu uranium blend. But because that doesn't require a long development time or a revolution in permitting or new regulation or anything like that, it doesn't give the satisfaction of uncovering a revolutionary idea that folks in the thorium space have often been looking for. I gave a talk at a thorium conference recently where I explained my my history and how I got into nuclear through looking at a thorium video. And some people loved my idea that I brought forth to them of putting thorium plus Hailu and heavy water reactors. Other people rejected it because it didn't have the other properties they claimed to want from their thorium reactor. Even though those are things you could get from a uranium reactor that's also cooled by molten salts or fueled by fuel mixed into molten salts. The thorium aspect is going to be relatively minor than the compared to the choice of using nuclear because nuclear by its very nature doesn't use much fuel. It's like LED light bulbs. Now that we have LED light bulbs. Lighting uses so little energy that if we invented something new that used even less, it might be difficult to convince people to switch if there was even the tiniest disadvantage from cost or function. Because we have already made LEDs that are so crazy effective, so cheap and so low energy use that there's almost nothing left to squeeze out of that. So too in nuclear, because uranium is a really incredible fuel, so dense you need so little of it to run the world's reactors that making it even more efficient provides less of an advantage than people might think and overcomes fewer of nuclear's real versus perceived issues and potentially would bring in new issues that we hadn't expected.
- [139:07]
B
I think you bring up something that's really important. At least that I only learned very recently, which is I too was evangelized by Kirk Sorensen's view of a dissolved thorium fueled molten salt reactor, or what Kirk likes to call the liquid fluoride thorium reactor or lifter. I was so evangelized by that that I didn't realize that most of the benefits that he's talking about in those videos are really benefits of the molten salt reactor design. You could use a molten salt uranium fueled reactor and get most of those benefits and perhaps that would be easier to permit from a regulatory standpoint. Am I on the right track there in terms of separating those issues?
- [139:52]
D
I think so. And we could go further and say that a good chunk of the advantages he's talking about are from any nuclear of any design whatsoever. And I would say that Americans have a blind spot towards Canadian reactors because that's not a type that we ever permitted for use in the US and we never built it here. So it wasn't something that's on our mind. And there was some commercial mismanagement of Canadian reactors and some difficulties along the way that led them not to spread as far as American style reactors spread. So only six or seven countries use those Canadian style reactors and it just slips our mind when we're looking for a revolutionary technology, something else. A lot of the advantages people talk about with lifters are not just from nuclear as nuclear, but come from electrification and expansion of electricity access. So thorium, a little bitty atom is left to bear a very heavy weight for solving all the world's problems when much of that is a solution that comes from any effective increase of nuclear electricity itself.
- [141:01]
B
Mark, Final question. We began this discussion 2 hours ago with your favorite picks for high level learning resources for listeners who wanted to understand the science of this and not just the industrial landscape. I've got to believe that after all this discussion, there's probably a few more suggestions you have for other resources. So what else should we provide our listeners with links to in their Research Roundup email?
- [141:25]
D
If anyone has it in their heart to do some pro nuclear energy donating Mothers for Nuclear is an extraordinary, extraordinarily effective group of people based in California originally, but now with chapters around the world. From two mothers who were working at a nuclear plant scheduled to shut down, who decided to push back, educate their own workers about the problems of shutting down the plant, their own company and eventually their state and then the nation to try to overcome the closure of their plant. They were successful this year and are looking beyond and other countries with reactors scheduled to close and countries that have never had the benefit of nuclear energy. So that is a tax deductible group that I know personally and I know does incredible work and I'm sure they would have a very good use of your donation if you thought that their goals matched what you want to see in the world next. If you're interested in this story of Thorium plus Canadian style reactors, you can certainly learn more either by contacting the team at Clean Core Thorium Energy or you can reach out to me and I'll put you in touch and show you what they're working on going into the next year. They're about to be the company with some of the most extraordinary new irradiation data for designing all types of advanced reactors because they're just about first in line for a rare spot for their test assembly in Idaho National Laboratories test reactor next spring. And then finally you can always get a hold of me through direct messages on Twitter Ergyvance or a hold of my team at my energy consultancy Radiant Energy Group where you can get a hold of me atmarkadian energy group.com thanks.
- [143:12]
B
For a terrific long form holiday interview, Mark. Patrick Seresna and I will be back as Macro Voices continues right here@macrovoices.com.
- [143:28]
A
Now back to your hosts Eric Townsend and Patrick Ceresna.
- [143:35]
C
Great interview with Mark Nelson. Eric. There is enough meat in there for our holiday listeners to stave off the mother in laws and a few chatty aunts and uncles as well. But kidding aside, I'm curious to know what your key takeaways were from this interview.
- [143:49]
B
I'm going to cover both what I learned from this interview and also a few things I learned from Mark off the air that didn't come out in the interview. One of the most important points that was never explicitly stated in the interview is this new reactor technology completely eliminates meltdown risk. In particular, some of the molten salt reactor designs literally shut themselves down automatically with zero meltdown risk. It simply cannot happen with these new designs. Even if the power goes out and the pumps fail and so forth, it can't melt down. But unfortunately, those advanced designs are not what's being built, primarily because regulators are not prepared to consider permitting them, especially in the United States. I personally didn't understand the real story on nuclear waste until I did a little research for this interview. The industry isn't quite ready to implement it yet, but the technology has been invented and proven to take every single ounce of nuclear waste from the last 70 years of reactor operation reprocess it and make new fuel out of it. So it will eventually be possible to build out a fleet of new nuclear reactors to replace all of the coal fired power plants, while decreasing, rather than increasing the total amount of spent fuel in storage globally. I think that's going to play a key role in overcoming public perception problems with nuclear energy. Something we didn't discuss, but which I predict will become a prominent new objection to nuclear energy, will be the risk of targeting nuclear power plants in wars. To be clear, there's absolutely zero risk of dropping a conventional bomb on a nuclear power plant and having it somehow cause a nuclear explosion as a result. It just doesn't work that way. But dropping a regular conventional bomb on an operating nuclear reactor would make a hell of a mess. It creates a dirty bomb, potentially splattering radioactive fuel all over the countryside and making a real environmental mess. So I'll be watching for advances in hardening nuclear power plants against military and terrorist attacks, including building them underground. From everything I've learned, the molten salt reactor designs are clearly the way of the future. And for anyone who's seen Kirk Sorensen's thorium videos, I think it's important to note that most of the benefits that Kirk describes for the LFTER reactor are actually benefits of molten salt reactors generally, regardless of whether the fuel happens to be thorium or uranium. So for regulatory burden reasons, I would expect uranium fueled molten salt reactors to be put into commercial operation sooner than the thorium versions, which I think are going to take longer due to the regulatory red tape that will be necessary in order to introduce a new fuel into the regime of what regulators are prepared to deal with. One place I have to respectfully disagree with Mark is on modular factory built reactors. His point, that small modular reactor is more of a marketing buzzword than an engineering reality, is well taken. But at the end of the day, the real problem as I see it, is that we're just not good at getting large bespoke public works projects like a conventional nuclear power plant done on time and on budget. As Mark mentioned in this interview, the Golden Gate Bridge was completed in less than four years for a total cost of $35 million, which is equivalent after adjusting for inflation to about 600 million in today's dollars. Now they're installing a suicide prevention net under the bridge to catch anyone who tries to jump off. That project has already cost $400 million, or 2/3 of the original cost of the entire bridge just to build a net and it's already taken longer than the four years that it took to build the entire bridge. So I'm convinced that we need to build nuclear power plants in factories run like Honda car manufacturing plants, but with nuclear quality standards. Now, whether it makes sense to build small modular nuclear reactors where the whole thing is the size of a shipping container as Copenhagen Atomics has proposed, or if it makes more sense to build gigantic nuclear reactors but build them in factories in small modular pieces that are mass produced in the factory and then just have to be assembled on site. Okay, look, I have no idea. I'm just starting to learn about this stuff. But I'm convinced that the solution is not going to be hiring the folks that are now busy building the suicide prevention network for two thirds the cost of the original Golden Gate Bridge and taking longer to get that project done hanging a net underneath a bridge than it took to build the entire bridge. So I'll be keeping my eyes open for nuclear technology that gets produced to highest possible quality standards in factory assembly lines with minimal on site bespoke construction. Another point that didn't come up in this interview is that in the current nuclear reactor fleet, only one third of the heat energy created in the nuclear chain reaction gets converted into electricity that can be sold into the grid. The other two thirds of the energy produced gets lost in heat dissipation. And that's one of the environmental gripes with nuclear the waste heat, while it may be perfectly free of radioactivity, still disrupts the natural ecosystem. So if somebody can figure out how to design a reactor that recovers 2/3 of the nuclear fission energy as electricity rather than just one third, that means revenue from electricity sold doubles and the environmental objections can be overcome. And from what I'm learning, the new super high temperature unpressurized molten salt reactors are going to be where those energy conversion efficiencies are most likely to be found. So I'll be watching very carefully for advancements in that area. Folks, this is now without a doubt the longest Macro Voices episode we've ever produced. So if you're still listening, I have to believe you either have serious in law problems or you're as interested and excited about the future of nuclear power technology as I am. So I'm going to leave it here until next week when we'll dive into how to invest in this industry. This episode of Macro Voices was made possible by Respect Energy, a leading European trader of renewable energy and a one stop shop for all green energy investors.
- [150:40]
C
And that's a wrap for part one of our two part holiday special on nuclear energy. Be sure to stay tuned again next week when Eric's guest will be Uranium Insider newsletter editor Justin Hume. When the focus will shift from understanding nuclear energy to investing in a coming bull market in all things nuclear, which Eric predicts will really take off after the coming recession first creates some terrific buying opportunities. That's coming up next week right here on Macro Voices. You'll find all of the materials Mark Nelson referenced in his interview in this week's Research Roundup Email so that does it for this week's episode. We appreciate all the feedback and support we get from our listeners and we're always looking for suggestions on how we can make the program even better. Now, for those of our listeners that write or blog about the markets and would like to share that content with our listeners, send us an email@researchroundupacrovoices.com and we will consider it for our weekly distributions. If you have not already, follow our main Twitter account Acro Voices for all the most recent updates and releases and you can also follow me on Twitter atricksarezna. On behalf of Eric Townsend myself, thank you for listening and we'll see you all next week.
- [152:01]
A
That concludes this edition of Macro Voices. Be sure to tune in each week to hear feature interviews with the brightest minds in finance and macroeconomics. Macro Voices is made possible by sponsorship from BigPicture Trading.com the Internet's premier source of online education for traders. Please visit bigpicturetrading.com for more information. Please register your free account@macrovoices.com Once registered, you'll receive our free weekly Research Roundup email containing links to supporting documents from our featured guests and the very best free financial content our volunteer research team could find on the Internet. Each week you'll also gain access to our free listener discussion forums and research library. And the more registered users we have, the more we'll be able to recruit high profile feature interview guests for future programs. So please register your free account today@macrovoices.com if you haven't already. You can subscribe to Macro Voices on itunes to have Macro Voices on automatically delivered to your mobile device each week free of charge. You can email questions for the program to mailbagrovoices.com and we'll answer your questions on the air from time to time in our Mailbag segment. Macro Voices is presented for informational and entertainment purposes only. The information presented on Macro Voices should not be construed as investment advice. Always consult a licensed investment professional before making investment decisions. The views and opinions expressed on Macro Voices are those of the participants and do not necessarily reflect those of the show's hosts or sponsors. Macro Voices, its producers, sponsors and hosts, Eric Townsend and Patrick Ceresna, shall not be liable for losses resulting from investment decisions based on information or viewpoints presented on the Macro Voices. Macro Voices is made possible by sponsorship from BigPicture Trading.com and by funding from Fourth Turning Capital Management, LLC. For more information, visit macrovoices.com.