How to understand the future of nuclear – and why it matters now

BY: CAT CLIFFORD

The nuclear industry is attempting to reinvent itself.

Historically, nuclear power plants have been massive, one-of-a-kind complexes that take years to build and supply power to thousands of people. But this model may not work to meet the planet’s future energy needs.

“If I can only buy your product in the Big Gulp size, and I only want a teacup, I’m kind of stuck,” Matthew Crozat, the executive director of strategy and policy development at the industry group Nuclear Energy Institute (NEI), told Cipher.

Read more about how to understand new nuclear technologies here, and why nuclear matters right now here.

Highlights here:

Companies and governments all over the world are working to scale that down, developing reactors in three smaller sizes known as medium, small and micro reactors that generate approximately 300 to 600 megawatts of electricity, 50 to 300 megawatts and less than 50 megawatts, respectively, according to the Idaho National Laboratory. That said, the size definitions for each category vary depending on who you ask.

Downsizing is not the only innovation in the nuclear world.

The latest nuclear reactors are often described as “modular,” a reference to how — and how fast — they are built, using parts that can be replicated in a factory, as opposed to bespoke pieces that must be crafted individually.
Also, many of the advanced reactors being developed now are what are known as “fast reactors.”

Fast reactors can even get energy out of fuel already spent by conventional reactors. Because of their efficiency, fast reactors can operate for longer periods before needing to be refueled.

Fast reactor designs also tend to use coolants other than water, influencing reactor construction and potentially bringing construction costs down.

Why now?

The exploding global demand for energy, combined with the urgent race to reduce carbon emissions, is focusing interest and investment on the once-staid, long-stagnant nuclear industry.

“In order to get to our climate goals, we actually absolutely must deploy nuclear, because otherwise the only solutions left to some of those applications will be fossil solutions — natural gas, backup diesel generators,” Kathryn Huff, former assistant secretary for nuclear at the U.S. Energy Department and now a professor at the University of Illinois Urbana-Champaign, told Cipher. “We will never get to net zero without that kind of 24-7 power that nuclear provides for some of those applications.”

Despite predictions for a nuclear renaissance, the future is still uncertain. Of particular concern: nuclear is and has been historically expensive.

While there are significant hurdles for the U.S. nuclear industry to overcome financially, politically and even logistically (like how to store nuclear waste).

There are also looming geopolitical risks, nuclear experts warn.

For example, if the U.S. does not establish itself as a global leader in new nuclear technologies, said Chris Levesque, CEO of TerraPower, countries such as Russia, China and France could fill in the gap with their state-owned and heavily-subsidized companies.

“We’re in an international competition,” he said.

Read more about how to understand new nuclear energy here.

And read about why nuclear energy matters right now here.

Editor’s note: TerraPower was founded by Bill Gates, who also founded Breakthrough Energy, which supports Cipher.

Lunchtime Reads and Hot Takes

Carbon Credits Found to Be Mostly ‘Ineffective’ in Key Study — Bloomberg
Bill’s take: The Science Based Targets Initiate (SBTi) is the white-hot center of a debate over carbon credits. This study won’t end the debate, but appears to edge toward a “yes, but…” approach to offsets.

Between Attacks on Electric Cars, Trump Says They’re ‘Incredible’ — The New York Times
Amy’s take: Politics is a funny business. Teslas don’t qualify for certain federal tax credits because some components are made in China, which is one of the key reasons Trump has criticized electric cars.

Greens look to counter lawmaker push on hydrogen credits — E&E News (subscription)
Cat’s take: The "tug-of-war," as E&E News aptly describes the negotiations, over how the U.S. Treasury Department should adjudicate the 2022 Inflation Reduction Act's hydrogen tax credit is in many ways an ideological debate over how to build a clean economy.

Vineyard Wind Installed The Largest Offshore Turbines In The Western World. But Were They Ready For Primetime? — Nantucket Current
Amena’s take: Considering this is the second incident involving this GE blade, the Nantucket Current asks if this large-scale turbine was ready for deployment.

The Electric: The Clock Ticks for Next-Gen Western Battery Startups — The Information
Bill’s take: Competing with China’s highly advanced, government-backed and ever-more innovative battery makers is a mission impossible for Western startups, most of which will need to pursue industry niches.

Trump effect in clean tech sector deepens angst in Europe’s boardrooms — Reuters
Anca’s take: This could lead to a serious U-turn considering the almost two years of headlines I've been reading about European companies being lured to the U.S. via the Inflation Reduction Act (panicking the EU).

UAE’s ALTÉRRA invests in fund backing fossil gas despite “climate solutions” pledge — Climate Home News
Amy’s take: Much of the oil and gas industry considers natural gas (which burns far less CO2 than coal) a climate solution, but long-term dependence on the fuel isn’t compatible with aggressive climate targets.

First Solar searches for breakthrough to cut China’s clean energy lead — Financial Times (subscription)
Cat’s take: This investment in solar in the U.S. is notable. The backdrop, though, is China is dominating solar innovation. China filed more than 9,000 solar patents last year and the U.S. filed fewer than 350.

Yellen Calls Climate Fight the World’s Greatest Economic Opportunity — Bloomberg
Amena’s take: Campaigns sound good on paper. The key as always lies in implementing sustainable practices and enforcing laws, as Cipher reported earlier this year.

‘Blood minerals’: EU accused of fueling conflict with Rwanda deal — POLITICO
Anca’s take: It's a complex geopolitical dynamic involving Rwanda and Congo, and a cautionary tale of all the other elements that can come with the mineral race: human rights, wars, smuggling — and precious lives.

More of what we're reading:

Helios raises initial $200 mln for Africa-focused climate fund — Reuters
Can Paris 2024 be the greenest Games yet? — Reuters
The dangerous effects of rising sea temperatures — Financial Times (subscription)
Barbados debt-for-climate swap nears as EIB, IDB finalize guarantees — Reuters

We denote ‘(subscription)’ when publications don’t provide any complimentary articles, but many others may ultimately allow you to read only a limited number each month before subscribing. We encourage those who can afford it to support the journalism you love most!

DATA DIVE

Renewed interest in nuclear energy bolsters uranium prices

Source: Daily uranium prices via Platts, part of S&P Global Commodity Insights • Shows spot price for a pound of uranium concentrate, or U308, on the Canadian market. Prices assessed daily, on weekdays. Data goes through July 18, 2024.

BY: CAT CLIFFORD

The price per pound of uranium has more than tripled over the past four years as interest in nuclear power has grown, according to data shared with Cipher from Platts, part of S&P Global Commodity Insights.

On March 2, 2020, a pound of uranium concentrate, the mined uranium that is processed into nuclear reactor fuel, cost $24.80 on the spot market in Canada, according to Platts. More than four years later, on July 18, that same pound of uranium on the same market cost $84.85.

Uranium is commercially traded in three main locations: the United States, Canada and France, William Freebairn, associate editorial director of nuclear power and uranium at S&P Global Commodity Insights, told Cipher. Platts and S&P use the price of mined uranium delivered to Canada as its baseline price; the price differences in the U.S. and France are minimal, Freebairn said.

From 2021 through 2023, the price of uranium marched steadily higher, reaching $107 on February 2, 2024, its highest peak over the last four years. The increase comes as excitement about nuclear energy has exploded in response to a sense of urgency about tackling climate change. Because nuclear reactors do not generate greenhouse gas emissions, this clean-energy sector has gained new appeal — and new investors.

In recent years, some nuclear operators have postponed or reversed decisions to retire nuclear plants in the U.S. and Europe, Freebairn said. There has also been talk about opening new nuclear plants in those markets and in less wealthy countries, he said.

These developments come after “a long period of underinvestment in uranium supply that tracked the declining enthusiasm for nuclear energy following the 2011 Fukushima nuclear accident in Japan and dropping global natural gas prices,” Freebairn told Cipher.

The high prices in February were also due in part to supply chain worries in Kazakhstan, the world’s largest producer of uranium, Freebairn said. Those woes have eased somewhat, moderating the price in the months since, he said.

Russia’s invasion of Ukraine and the West’s subsequent desire to wean off Russian supply chains have driven the costs of nuclear fuel higher but have had less of an impact on the price of mined, unprocessed uranium, said Freebairn. While Russia is a major producer of processed nuclear fuel, it is not a major exporter of raw uranium.

AND FINALLY...
Forecast: no load shedding

Cipher reader and in-house energy counsel for a major industrial gas supplier Catherine Kortlandt was in South Africa last Christmas when she spotted this sign at a boutique hotel during breakfast. It was a weather report with an energy twist! The “no load shedding” at the bottom refers to the fact that no power blackouts were scheduled for that day.

Each week, we feature a photo that is somehow related to energy, the thing we all need but don’t notice until it’s expensive or gone. Email your ideas and photos to news@ciphernews.com.

Editor’s note: In addition to supporting Cipher, Breakthrough Energy also supports and partners with a range of entities working to tackle climate change, including nonprofits, corporations, startups and research firms. For more information on Cipher’s editorial policy, click here.

How to understand the future of nuclear – and why it matters now

Renewed interest in nuclear energy bolsters uranium prices

AND FINALLY...Forecast: no load shedding

AND FINALLY...
Forecast: no load shedding