In this episode, I speak with Jigar Shah (head of DOE’s Loan Programs Office) about all things nuclear, including its recent performance, the strategies that could revive and accelerate it, new nuclear technologies and what small modular reactors actually are, and the role that nuclear will play in a decarbonized economy.
Text transcript:
David Roberts
Nuclear power is a subject that elicits a lot of strong emotions. (Anyone who's ever written about it online will be laughing at the understatement.) Depending on who you listen to, it is either the key to solving climate change or an irrelevant distraction, either the best form of clean electricity available or the worst, either a savior on the verge of a renaissance or a dinosaur desperately scrabbling for a few last subsidies.
To try to cut through some of the noise, I went to the top: Jigar Shah, longtime clean energy investor and expert, friend and previous guest of the pod, and head of the Department of Energy's Loan Programs Office.
Shah is a solar guy at heart — he got his start founding and growing some of the earliest solar companies — but as head of the LPO, he has had a crash education in the state of the nuclear industry and what it needs to revive itself. The DOE's take on the subject can be found in its recent Pathways to Commercial Liftoff report for advanced nuclear. Long story short, the Biden administration believes that in order to hit its climate goals, the US needs to double or triple its nuclear capacity by 2050.
To do that, it needs to get its ballooning costs under control. How? That is one of the things I asked Shah when I talked with him. We discussed the factors responsible for nuclear's dismal recent performance, the strategies that could revive and accelerate it, new nuclear technologies and what small modular reactors (SMRs) actually are, and the role that nuclear will play in a decarbonized economy. Whatever your take on nuclear, I guarantee this pod will give you something to think about. All right, then. With no further ado, Jigar Shah, head of DOE's Loan Programs Office. Welcome back to Volts — have you been on before?
Jigar Shah
I think we did do one in my official position.
David Roberts
Yeah, it's all hazy now; it's all a blur. All the past pods are a blur to me. Well, welcome back. So, we are here to talk about everyone's favorite subject: nuclear power — upon which everyone has calm and reasoned and fully, empirically backed opinions. We're just going to walk through —
Jigar Shah
I feel like it is. The easiest way to trigger people is just to say the word "nuclear."
David Roberts
Literally, I could just tweet the word "nuclear," and I guarantee you I would get a dozen hostile responses. Like, "I don't like your tone. The way you ... I could just tell." Okay, so let's start at the beginning. Before we even get into nuclear, let's discuss what energy nerds call "clean firm" generation and why we need it. I think, so — a lot of Volts listeners will be familiar with this, maybe not all — so the basic idea is we're going to build a system where wind and solar are kind of the core, the cheapest bulk producers of electricity, but they are variable, they come and go with the weather, there are gaps. So you need to fill in the gaps. So tell us what clean firm is and why we need it, and how much we think we're going to need.
Jigar Shah
Yeah, let me back up even one more step from there. I think the way that the grid worked before, and the way some people still want to operate the grid, is that demand does whatever it wants. The grid transports power to that demand, and that the generation basically ramps up and down to meet the needs of air conditioning and all that stuff. So in that old school format, that was coal. And then in the 1980s, when we were all installing air conditioning, it became gas. And so we built 400, 500 GW worth of gas. And now we still live with that legacy of everyone running the grid, where demand does whatever it wants.
Transmission is limited in supply — and we still haven't even deployed the most basic grid enhancing technologies and the things on our grid — and generation does all the work.
David Roberts
Right.
Jigar Shah
And so now we've decided that we're going to move to a clean energy future. And that clean energy future as — funny enough, like, I'm the one defending clean firm when I did all the solar stuff. But — I think when I started, this entire solar industry globally was a billion dollars a year, and now it's a billion dollars a day. But because solar on a variable cost basis is so cheap today, and wind as well, we're building a lot of it. In fact, probably 80% of everything we've built since 2016 has been wind or solar on the grid in terms of megawatts.
And so when you think about the way the grid operates, there is a need to figure out how to balance the grid and make sure that when you have weather fluctuations, et cetera, but also just to use the transmission capacity that we have, that when the solar is not working and that excess transmission capacity is there, then these other resources come in and use it. And so there's a basic question moving forward around how do we want to operate generation? And when you think about clean firm technologies within that framework, then we do lots of modeling. So, NREL Clean Futures has modeling,
Princeton has modeling, Chris Clack has modeling. What it all says is that in a world where you have transmission constraints, you need higher levels of clean firm power to better utilize that transmission.
David Roberts
Yeah, and let's just say clean firm means carbon-free, but also available on demand for as long as you need it. As far as I know, that is the working sort of definition of clean firm, yes?
Jigar Shah
Yeah, although honestly, this on-demand thing: as you know, hydro and geothermal can store things, but they're not as on-demand as people want them to be.
David Roberts
Yes. So just something that's there when solar and wind aren't.
Jigar Shah
That's right. I think that's a better definition.
David Roberts
And so let's talk about that category of clean firm. Used to be pretty spare, but now there are options within this category. So we count hydro there. You can sort of ramp hydro up and down a little bit when you need it. We count now geothermal there. Geothermal is sort of always running, and you can ramp that up and down when you need it. Now we count long duration energy storage, which are, as you well know, there's a few technologies starting to pop up here and there. We count fossil fuel generation with 90%-plus carbon capture attached to it as clean firm, and we count nuclear as clean firm.
That basically covers the waterfront. Yet those are our clean firm options.
Jigar Shah
Yeah, and some folks are still pining for biomass plus CCS.
David Roberts
Yes, I suppose I should include that in the list in case any ever shows up. So then, I guess what I would say if I just come to you and say, "Look, all right, we have this category, clean firm, we need a bunch of it." You got a bunch of these technologies that are racing ahead, all this exciting new development, especially long duration energy storage. Some of those, some geothermal is very exciting. There's some exciting new news coming from Fervo on Monday about that. Well, yeah, I guess that will already be out by the time this is released.
But anyway, so there's a lot of exciting development in these other categories. And then you look at nuclear and you see like decades basically, of industry incompetence, inability to build projects on time or on budget, everything going wildly over budget, ratepayers getting stuck with massive, massive overrun costs. Just a bit of a dumpster fire. The industry looks like a dumpster fire. So what if I just say to you, well, "Let's just do those other clean firm options. We tried, we've been trying nuclear for decades, we're not getting any better at it." Why not just give up? Why pursue nuclear?
Jigar Shah
Yeah, it's a good question. And I think the first part that we all need to agree on — which I'm not sure we all do — is that we don't actually live in a world of the trade-offs that we're presenting. So the notion that someone pursuing nuclear was going to be done as solar plus storage is just not true. Like in general, the vast majority of case studies that I can show you is nuclear versus gas. Nobody was thinking nuclear versus solar plus storage. So if you look at Vermont Yankee, and when that shut down, right, when that shut down, it was environmentalists who shut that down, and they were saying, "we're going to replace this with solar plus storage."
You and I both know objectively it was replaced by gas. Right? The same thing's true with Indian Point: When Indian Point was shut down, we were going to change it out with hydro, from Hydro-Québec coming down the Hudson river and then connecting it to New York City. That transmission line is not yet completed, but Indian Point shut down. So guess what filled the gap? Gas. Right. So I just want to make sure that everyone understands that when they have these straw man arguments of, like, "Why are we doing more CCS demonstrations when those projects in Australia were terrible, and there were those great YouTube videos making fun of them?" or "Why are we doing nuclear? Or why are we doing enhanced geothermal?" I mean, I have people, just so you know, who hate me right now for enhanced geothermal because it has something to do with hydraulic fracturing.
David Roberts
What? Oh, come on.
Jigar Shah
You get canceled for lots of things these days, right? And so we do these things because we believe that all tools need to be on the table to meet the president's bold, audacious goals of decarbonization by 2035. I'm not predicting for you that nuclear is going to rise to the occasion, but it is my job to say that, "Here is what nuclear did wrong in the past. Here's how we're going to do it better this time, and we'll see if people come to the party."
David Roberts
Right? So the Biden administration's basic take on this is "we need to develop as many tools as possible," basically. We need to commercialize and spin up and improve as many tools as possible, including nuclear.
Jigar Shah
And not just here in the United States, but because we have an obligation to export this technology to help everyone decarbonize around the world. And there are a lot of countries that have signed MOUs and now increasingly contracts for American nuclear technology, whether it's Poland or Romania or Bulgaria. And the competition there is China and Russia. So does everybody want China and Russia to have an 80-year relationship with those countries, or do they want the US to have an 80-year relationship with those countries?
David Roberts
Well, you say, "here's why nuclear has blown it in the past, and here's what we're going to do to fix it." Why has it blown it in the past, what is the explanation? It's funny, like, the nuclear is so controversial, we can't even really agree on this part of the story. So why has it been such a dumpster fire these past few decades?
Jigar Shah
Yeah. Let me take us back through time just slightly, because, you know, frankly, I've learned a lot in this job. When you think about what nuclear did wrong in the United States, and we can compare it to Korea and other places, is that we have 92 operating reactors today in this country and no four of them are the same. So we decided that every single nuclear plant should be a snowflake. It's like the original snowflake. So we never got good at a design and made it stable. Compare that to Canada, which has the CANDU reactor, and every one of their reactors is a CANDU reactor and they're all the same.
Or compare that to Korea, with their 1400 MW reactor, and they're all the same. Or even China.
David Roberts
Who is we in this situation? Who is the we that did this?
Jigar Shah
That's a very interesting question. So the we is the Atomic Energy Commission before DOE was started — you know that the Vogtle nuclear plant is the only reactor that has ever been approved by the NRC?
David Roberts
No kidding.
Jigar Shah
Every other reactor operating in the United States was approved during the Atomic Energy Commission, and then some of them were completed under the NRC's jurisdiction.
David Roberts
When did the NRC come around?
Jigar Shah
Somewhere around, like, Three Mile Island. So let's call it the late '70s.
David Roberts
Got it. So the Atomic Energy Commission approved a bunch of different designs. And this is another question: I don't want to spend too much time on this, but I've always been sort of curious, like, how on earth are there 92 different ways to build a nuclear plant? The technology of splitting the atom doesn't seem like there are that many ways to do it. What are all these varieties? Like, what are all these differences?
Jigar Shah
Well, I'm not going to be able to give you a great answer to that because I'm just not that smart. But Katy Huff can, who runs nuclear energy. But what I would say is that at their core — pun intended, I guess — you have low-enrichment uranium, you have high-assay uranium, the HALEU that we talk about now. So that's the feedstock. You have coatings around the fuel. So now you have like TRISO fuel, which basically says that even if all the safety systems in the nuclear plant stop working, the fuel itself is coated with this ceramic that actually expands and stops the fission process above a certain temperature.
So, it's like foolproof, right? So you've got some of that stuff, and then you've got ways in which you do the cooling, ways in which you — some people want to use like molten salt, for instance, like in the Natrium reactor. Some folks wanted to use water. So you have that. But going back to your question on the Atomic Energy Commission, the fatal flaw was that all of the reactor makers created this sort of, like, menu of options. And a lot of utilities thought that that meant that they should actually select different features off a menu.
So it's not dissimilar to getting a car and buying it off the website and picking different options. So the reactors weren't that different, but they were different enough that they actually needed to pay attention to what features the person made when they should have just said, like Henry Ford did, "You can have whatever you want as long as it's black and white."
David Roberts
So the industry bears some responsibility too for not —
Jigar Shah
I mean, most of it, yeah.
David Roberts
Not seeing the need for standardization.
Jigar Shah
Most of it, for sure.
David Roberts
So then why, if it's become so clear that doing 91 first-of-a-kind program projects in a row is a disaster, why then, years ago, didn't the industry start saying, "Hey, let's standardize," or why didn't the NRC? Why has this been allowed to go on for so long? Why are we still doing first of a kind projects decades later?
Jigar Shah
So the dynamics in the industry are like, there's this narrative, which is wholly untrue, that anti-nuclear activists killed nuclear. That's just not true. What killed nuclear was that in the 1970s, you had this enormous run-up in the cost of nuclear, right? So the learning curve went away and the costs of nuclear were going up and up and up. And people were saying, "This is not something that we — are sustainable that we want to do." And so right around the time that they were saying, "We're not going to approve any more nuclear reactors," Three Mile Island happened.
And you were like, "Well, I guess we're definitely not going to do any more nuclear reactors." So it wasn't Three Mile Island that caused it. It was the run-up in costs of the 1970s. And then you had some reactors that people had already started that they finished. So I grew up in Illinois, northwest Illinois, in Sterling, and there's a reactor at Byron Nuclear Power Plant. Then that turned on in 1984. And then, like Watts Bar turned on years later in TVA's territory. But in general, all of that workforce, all of those engineers, all of those people who worked on building nuclear reactors went into other careers, and at this point, many of them are fully retired.
David Roberts
Yeah.
Jigar Shah
And so we don't have any of that. So then when it came time to build Vogtle, the National Building Trades trained 13,000 people in how to build a nuclear power plant. At any one time, I think they had 9,000 people working at that facility.
David Roberts
So it's a first-of-a-kind project with beginner, first-time engineers and first-time construction people on it?
Jigar Shah
Totally. I mean, we had all the best nuclear people we could find and we needed 100 times more than that to build this thing. And so you ended up with a couple of big failures at Vogtle. One big failure was the cost estimates were way off.
David Roberts
Yeah.
Jigar Shah
Right. I think it is very obvious now, in hindsight, that when you do a proper cost study, which they did not do, then the numbers should have started higher than they originally said. And it wasn't malfeasance. It wasn't like anyone was trying to pull the wool over anybody's eyes just because this office was a part of it; it was just stupidity. There should have been more cautiousness.
David Roberts
But don't you think, like if I'm a citizen, especially a citizen of Georgia, and you're telling me we need to build a bunch of new nuclear. One of the things I want to say is, "Well, I'd like to see some heads roll or some sign that someone has been held responsible for the grotesque results of Vogtle before we just launch into some new stuff." Like, is anybody at fault? Has anybody been called to the carpet? Has anybody lost a job or lost anything? Like, is anybody well, punished in any way for this happening?
Jigar Shah
So let me answer that question, but first say this is not a nuclear problem. This is a "Can America do big things?" problem.
So whether it's the Big Dig in Boston or whether it's like any other large project you've ever heard of, like the Second Avenue Subway —
David Roberts
High-speed rail in California.
Jigar Shah
High-speed rail. This country lost the ability to do big things — and on purpose. Right? Because for 40-plus years, from Ronald Reagan through Bill Clinton, and then after that, we said, "You know what? We don't want to attempt big things in this country. Why don't you go to China and make it right?" And so it was our official policy to commercialize our technology in China, not to commercialize it here.
You remember that my career started at BP Solar? We had a manufacturing facility in Frederick, Maryland, and we invented all those solar technologies we made an active decision not to scale up manufacturing in this country in 2008 to 2012 and instead to have it happen in China. Right, and so it's not surprising to me that we didn't have those skills. Now, in terms of holding people accountable, certainly, Toshiba had a bankruptcy. Westinghouse then got sold, and now is owned by the Canadians. And when you think about what happened to SCANA, right, I mean, they are now like, that utility is no longer an independent company.
Right. And so there certainly were a lot of consequences. And I think there are folks in Westinghouse that actually even saw guilty verdicts against them in court for misrepresenting things. So there were certain people that were held accountable. But honestly, the biggest thing to hold us accountable is that the fact that we allowed ourselves to lose this fundamental skill that the American people had for decades and decades, and it atrophied to the point that Vogtle occurred. And I think what the president is saying with the Bipartisan Infrastructure Law and the Inflation Reduction Act is we got to get that back.
David Roberts
Yeah. Well, this is another question, I think, that energy people have about this, which is, "Okay, let's accept this story that we lost the ability to do big things. We lost the workforce. So now in order to build nuclear at scale, we not only have to build big projects that take a long time, we have to sort of rediscover our ability to build big projects and train an entirely new workforce. That just sounds big and difficult and slow. At a time when we're frantically short of time, why would we think that we can rebuild that entire sort of national capacity in the timescales we need?"
Jigar Shah
So, let's go back to the beginning of our conversation, and I'll answer that question. I think the question is, what do we need? Right? I think we need solar and wind to go faster, farther, jump higher, like scale tall buildings. So they're at whatever they are now. I think it's like 47 GW or something per year. That number needs to get to 100, and then that number needs to get to 200 GW a year. So no one is questioning the trajectory of the solar and wind industry. No one is slowing them down. No one is saying, like, "hey, guys, we need to make room for nuclear."
No one's saying that. But when you think about what's changed: In 2019 when we were having this conversation, everyone was talking about replacing plants that were being decommissioned. So we need solar and wind to replace the power coming from retiring coal plants and natural gas plants. Today, we're talking about persistent load growth that's six times higher than what we've experienced the last 20 years. And we have AI saying — I mean, Microsoft alone, I think, is saying we need 10,000 MW for ChatGPT. You've got Google, Amazon, Apple, Meta. Then you have EVs, right, — which, by the way, is not as big of a problem, but we can get into that at some other podcast.
And then you've got the extraordinary success of the Bipartisan Infrastructure Law and the Inflation Reduction Act. We have three times more manufacturing plants going up right now than our 30-year average. So all of those projects need electricity. So, with all of the solar and wind that people are going to build as much as possible, we still don't have enough to double sales by 2050, which is what everyone's predicting now. And then you say, "let's do geothermal." Great, let's do geothermal. When you look at geothermal, we've got three to five GW of geothermal that we think is immediately stuff that we can do by 2030.
We're using all the stuff that Fervo and Sage and other people are talking about.
David Roberts
Just three to five, is that it, by 2030? Well, I guess 2030 is not that far away.
Jigar Shah
We're talking about three to five. Right. Great. And then they're saying that that number could jump up to almost 90 GW. But remember, some of that has to be done on the east coast, and the east coast costs double than the west coast because we don't have the natural benefits. And so the learning curve has to come down a lot on the west coast before it can travel to the east coast. So it's more the 2040s, when the east coast starts becoming cost-effective. And that's not a lot of power, unfortunately. Like 80, 90 GW is not a lot.
David Roberts
You've run all these numbers and done all these models, and basically the sort of position of the LPO is that we need to two or three x our nuclear capacity. And the way you come to that is by sort of running the model, like, how much can we get out of wind and solar? How much can we get out of geothermal, et cetera, et cetera. What's left over that we need? We need two to three x.
Jigar Shah
And that's 200 GW. And that's what the president announced at COP, is that we need to triple our nuclear capacity.
David Roberts
But that modeling presumes, based on some assumptions about the future costs of long-duration energy storage and geothermal and stuff like that.
Jigar Shah
Yes, and we can definitely have that conversation, although that rabbit hole is very deep. But I think let's just suffice it to say that solar plus wind plus long-duration energy storage can be considered clean firm. Right? But let us just run a thought experiment for a second: The deciders of this are the hyperscale data centers, because they themselves need 200,000 MWh, 200 TWh —
David Roberts
Ridiculous.
Jigar Shah
of new power by 2030. Right? And that's the low-end estimate from Boston Consulting Group that Rob Gramlich put in that Grid Strategies paper that got all that press a month ago. So if you ask those people how to solve this problem, they could easily pick off a bunch of solar and wind projects sitting in transmission queues. You know that there's 2000 GW of that, right? And say, why don't we just put an 18 hours battery there and just run that sucker off grid, right? But guess what? That number is coming in right now, closer to like $200 a GWh, if that.
It may be even higher.
David Roberts
Right?
Jigar Shah
So you know what they're choosing to do instead? They're building a bunch of Bloom boxes powered by natural gas to run a lot of those off grid — and they're not off grid, it's like undergrid. So they have locations where the utility has half the power that they need. They get the other half from Bloom, and then they're waiting for the utility to catch up in two years when the interconnection gets full. And then, of course, the Bloom box continues to run. So I just want to make sure we're crystal clear about the fact that this is not a theoretical conversation.
Like if Microsoft and Google and Amazon and Meta and Apple thought that what you were saying was something that they could do today, they would sign a contract for it today.
David Roberts
Yeah. Well, I mean, small, affordable nuclear is not something we can do today either. Whatever bet they make is a bet on some future radical expansion of something.
Jigar Shah
But let's test that theory. So I agree with you: Nuclear has not proven itself. let's be crystal clear about that. But if you look at Unit 3, Unit 3 came in at x dollars —
David Roberts
At Vogtle.
Jigar Shah
at Vogtle, sorry. And then Unit 4 came in at a 30% discount to Unit 3. So if you just built Unit 4 again at Unit 5, right next door to Unit 4, it would come in at somewhere in the neighborhood of $130 a MWh, and you'd be able to do it in half the time.
David Roberts
Got it.
Jigar Shah
Because you have a trained workforce and all that stuff.
David Roberts
You're confident in the learning curve if we standardize our design. One more question about that, because I have a bunch of questions about the standardization thing, but just to get this off my screen: One of the stories you hear from nuclear, I probably shouldn't call them bros on the podcast, lest I tip my —
Jigar Shah
Enthusiasts
David Roberts
enthusiasts online, is that the reason nuclear isn't flourishing today is a thicket of regulations and requirements and sort of hyperactive safety requirements and all this stuff at the NRC. And it's this regulatory tangle that they can't get through, and that's what's holding it back. You just don't buy that at all.
Jigar Shah
The headline answer to your question is that it's not true. The NRC is not in the way of nuclear today. Now, are there improvements that they can make? Yes. I'll give you an example of one. So, for instance, when you look at the modern nuclear designs, whether it's the Hitachi BWRX-300 or whether it's the Holtec or NuScale reactors in the NRC's actual regulations, you have to have active safety systems, even though we've proven —
David Roberts
Right, I've heard this, right, because they have passive safety systems in these new ones.
Jigar Shah
Now, should the NRC update that? Yes. But is that actually what's holding up new designs? No. So I can give you a list of 20 things that the NRC needs to improve. And in fact, we've talked to our colleagues there, and they are improving them. But that's not the long pole in the tent.
David Roberts
Got it. So that's a little bit of cope from the nuclear enthusiasts, as we might call it. All right, so here's my main question about this whole thing. I hear sort of two stories in nuclear: One is the story you're telling now, which is we have these big designs now. The sort of standard design now is fine if we just pick one of them and do it over and over again.
Jigar Shah
Which, if we did the big one, it would be the AP1000.
David Roberts
Yeah, the AP1000, which is the one that is sort of, kind of the default now. And then we have this other story I hear from nuclear, which is about all these new, smaller, safer, exciting technologies coming online. There's SMRs, there's micro reactors, there's pebble-bed this and this and that. So is it standardize on the old technology or is it develop these new technologies? How do those two stories sit in our head next to one another?
Jigar Shah
Yeah, it's a great question. I saw Jesse's tweet on, "Why would you do 1200 MW of SMRs instead of one AP1000." Right, which is the same amount. So basically, the way nuclear works is you always want to build two or four, not one — for a variety of reasons. Some are resiliency based, right, in terms of if something has to go down or whatever. But the other reason is because at every single site, you have certain security costs and site costs and other things, and so you want to share that over other things. And then the last issue is that you always get a cheaper price between one and four.
So the first one is always more expensive. At every site, even when we're building the 30th nuclear reactor, it'll be the same that the new site the first one will be more expensive, the second will be cheaper, the third one is cheaper, the fourth one's cheaper. So it is objectively the case that if you went to a 1200 MW coal site, which by definition only has 1200 infrastructure around it, and you built one AP1000, that would be more expensive than building four 300 MW reactors, because the second, third and fourth one will be cheaper than the first one.
And so it's better to do it that way, and then you get the resiliency benefits, et cetera. So if you're going to build the AP1000, you need a minimum of 2200 MW of infrastructure around that site.
David Roberts
That's a lot.
Jigar Shah
It's a lot.
David Roberts
But that doesn't totally answer my question, which is, what should we make of the hype around the new nuclear technologies? If standardization is the problem and the solution, what is the point of all these new technologies?
Jigar Shah
It's a good question. So the way this stuff works always is you have to have a customer, and you have to have a constructor and all that stuff. Right? So the question is, what's the forcing function? Right. Obviously, from DOE's perspective, what we care about is making sure all these tools get across the bridge to bankability and all that stuff. Right? Great. What does the marketplace want? So, in some of these states, it is viewed by many utilities that they are either going to build nuclear or they're going to build gas or hydro or geothermal if they can't, right?
So this is the fight that Tyler is having online with on the Duke Energy IRP, right? Duke Energy is definitely going to build 7000 MW of gas, or else they're going to build nuclear, they're not going to build solar plus long duration energy storage, because for whatever reason, the people that work there believe that that is not going to meet the needs of the industrialization of North Carolina. And that includes, by the way, the regulators. So when you talk to Governor Kemp in Georgia, what he will say at Davos and in every other thing he's done over the last six weeks is that these manufacturers have chosen Georgia over other places.
And Georgia, as you know, has been the undisputed winner out of the IRA sweepstakes, because of Vogtle. Because they want to control scope 2 and scope 3 emissions and being able to have 24 x 7 clean power banners. Now we can say that that's lip service. Fine.
David Roberts
And can't we also just say that those guys are wrong and that they are not up on the latest? Just because they say that doesn't, they shouldn't force us to accept that just because they think that.
Jigar Shah
Well, but I don't know who "us" is here, right? Remember that we have moved from this industry when you and I were first doing it, of being labeled alternative to now us being the energy industry. So we're talking about ourselves here. Right? There isn't an other at this point. Right? So the question now becomes, if Microsoft and Google have publicly said that they need to be 24 x 7 matched with clean energy by 2030, they have a set of options. They can get hydro — and you may have seen that Iron Mountain agreed to pay up to $115 a MWh for hydro from Rye Development because that's what they think it'll cost to do 24 x 7 matching.
David Roberts
Interesting.
Jigar Shah
And so, they have other options. They could do solar plus wind plus long duration energy storage. We've talked about a lot of this, particularly with 45V and the matching there. So folks have protocols, all these other things they could do. Natural gas plus CCS at 90% that you talked about. And Google even published a paper on this. Right? And their paper suggests that they believe that nuclear power is the likeliest to be able to meet this 24 x 7 matching requirement that they have. Right. So then what they do with that data is they go to a utility and they say, "we would like a hamburger today, and I'll give you two hamburgers tomorrow."
Right, so they're saying our CFO needs a data center next week because it's dependent upon us making $20 billion a quarter in profits. So we'll do that. And in exchange, we'll agree to pay an above-market tariff for 24x7 matched clean power that you will start construction of to supply us with this 24x7 matching that we need, whether it's in 2030 or whether it's in 2035. Right?
David Roberts
But my impression is that those guys are after the hot new nuclear technology. That's what always gets mentioned in those papers. That's what seems like what those tech guys think they want is SMRs and etc.
Jigar Shah
Well, so we can cover that in a second. But I just want to make sure that we understand the dynamics of the marketplace because we herald the marketplace as all-important here in this country. And so I want to make sure that you understand that the Loan Programs Office is downhill from all this, right? We're not making any of this happen; we're listening to people who want to borrow money from our office for a new nuclear plant and those are the dynamics underway. And we're agnostic, right. So, if the utility says we just came to an understanding with Microsoft and Google and Apple and Amazon and Meta for geothermal at $150 a MWh or offshore wind at this price or whatever it is, we would do that loan.
David Roberts
Well, what are nuclear requests to the LPO? What do they look like right now? Like what are people asking you to help with right now nuclear-wise?
Jigar Shah
So the active loan applications we have in now are trade secret, confidential. But I'll give you categories. One is like a restart of an existing nuclear plant, you've got making nuclear fuel because we want to make sure that we're not bringing it from Russia. There's also these micronuclear reactors that we didn't talk about yet, but we can. So these are truly manufactured products. SMRs and AP1000s are not. These are truly manufactured products. And you've already seen some of this get into the press where the oil and gas sector are paying 35, 40, 50 cents a KW for diesels in the field to power their stuff.
And they're willing to pay for micronuclear reactors in those places to put stuff in. But also there's Caribbean islands and folks in Alaska, etc. that are looking for these 1 - 50 MW reactors that generate 50 MW of heat. So then that turns into like 17 MW electric.
David Roberts
So nobody's knocking on your door saying "We want to build another AP1000 giant nuclear plant and we want you to help."
Jigar Shah
Funny enough, they are. So we have $128 billion now of 1706 loan applications in from utilities. This is reconductoring and converting a coal plant to a solar plus battery storage plant. And for the first time three utilities have come to us and said, you know what, we were thinking about SMRs. But honestly, AP1000 seemed like a lower risk.
David Roberts
This is hilarious to me. The turnabout in the SMR discourse lately is remarkable to me. Let's talk about SMRs for a minute, because I want to cover this. So not that long ago there was so much hype about SMRs. SMR stands for small modular reactor. And the idea behind it, which has created all the hype, is we're going to make plants that are smaller, the parts are going to be smaller, the parts are going to be manufactured in factories, they're going to be modular, we're going to create them over and over again. So we're going to lower costs.
But if you follow the actual development of the industry, what is being offered under that banner is not particularly small, not particularly modular, and not particularly that much cheaper than the big old plants.
Jigar Shah
But the branding is amazing, Dave — the branding!
David Roberts
The whole SMR space just seems like an absolute, like a wet — I don't even know what analogy I'm looking for. Like nothing came of it. Nothing came of it. Is there any?
Jigar Shah
No, I think things are still coming of it.
David Roberts
Let's tell me about SMRs. What is the deal with SMRs?
Jigar Shah
I agree with you that they're neither small nor modular, but they are reactors. Some of what you say is true. And so I don't think that they're going to be manufactured in a factory and then drop-shipped to a site. It is true that the parts are smaller. So some of the parts right now for nuclear reactors, for the AP1000 can only be made in a forge in Japan. Like that will change. And the SMRs are of a size that you can make them in the US and Canada. But the rest of what you say is true, and it is structurally more expensive to do an SMR than to do an AP1000, because by definition, everything else is just miniaturized.
And some of the fixed costs are still the same, whether it's security or the perimeter or refueling costs, etc. So it'll never be the case — like today, for instance, with nuclear power plants being fully paid off, the variable cost there is like three and a half cents a kWh to run those plants. If these SMRs were fully paid off, it would be, let's say, five and a half cents to run those plants. So that part is true. But the part that I would say differently is, remember, nuclear is really a trust exercise, I think is where this whole conversation has been going.
Instead of building unit three and unit four at Vogtle, if we had built instead for that 2200 MW seven 300 MW reactors, I can assure you that that 7th reactor would basically be at the same cost as that 6th reactor. And you would see a ton of people around the country building that 300 MW reactor, because now the schedule and the price had gotten stable. Maybe not cheap, but it would have been stable and predictable.
David Roberts
So you could standardize on an SMR, one of these SMR designs. I mean, you could standardize on anything and drive the cost down if you just built a bunch of it, basically.
Jigar Shah
In the same way that you can do, let's say, offshore wind. So, like, offshore wind will never be a manufactured product that gets this solar-like learning curve. But you will go from first of a kind to 10th of a kind cost, which is maybe 50% cheaper.
David Roberts
Right.
Jigar Shah
Which is great, but it's never going to be the 98% reduction in cost.
David Roberts
Right. So then help us distinguish SMRs, which apparently are just like, rebranded slightly smaller conventional reactors, from, say, for instance, microreactors. What is a microreactor? Is the technology, the actual atom splitting technology any different in that, or have they just found a way to make it small somehow?
Jigar Shah
Yeah, it's absolutely the same. And so, just to finish that last conversation, it really comes down to what fits in the existing footprint that we have. Right? So, if that footprint has a 1200 MW footprint, you'd build four SMRs. If it had a 2200 MW footprint, you'd put in two AP 1000s. So, I think that's where that is. On the micro side, you go from 1 to 17 MW electric, and then you multiply it by three for heat. And so, you're starting to see X-Energy and Dow have that conversation. And in that case, Dow wants the heat. And nuclear is remarkably good at making heat. So, it's actually the conversion of the heat to electricity, where you lose a lot of the value.
David Roberts
Yeah. What is the phrase? "It's an incredible way to boil water."
Jigar Shah
Yeah, exactly. A very expensive water boiling exercise. Rube Goldberg, I guess.
David Roberts
So, they can make them really small, then. We do know how to make them very small.
Jigar Shah
The technology is exactly the same. And in fact, that's how the nuclear Navy works. Right? Those are all small.
David Roberts
Yeah. I can't tell you how many questions I get about that every time I bring it up online. Somebody wants to know, like, "If we have these tiny little reactors powering ships in the navy, why don't we just take those little reactors and power a neighborhood or power a data center or whatever."
Jigar Shah
Yeah, fun fact. In the 1970s, Jacksonville got the authority to build a nuclear crane to basically build a bunch of nuclear boats that would just be parked at ports to power people's ports. They never built one. But that nuclear crane still exists at Jacksonville.
David Roberts
It's literally a crane powered by nuclear power?
Jigar Shah
No, it's a crane that's beefy enough to be able to handle a nuclear boat.
David Roberts
Oh, I see. But what's the answer? Why don't we use those microreactors elsewhere? Like something that is small and firm, as we said, and modular and factory producible? Seems like the answer to a bunch of our — seems like what we'd want.
Jigar Shah
Well, we are headed there. And so DOD started with Project Pele. And so that unit is expected to be completed by the end of next year. And then you've got —
David Roberts
Where's that? And how big is it?
Jigar Shah
I think it's 1 MW, and it basically is able to — their specs are, you're able to move it around. Right. So they could actually, week to week, move it from place to place.
David Roberts
Oh, no kidding.
Jigar Shah
Yeah, so you can imagine it's very expensive.
David Roberts
Yeah.
Jigar Shah
But they're paying for it, so that's happening. I'd say that if you made an order for ten of those units now, they'd be at 17 MW each. They would probably generate power at like 50 cents a KW. As you know, you have to build a real factory and then make 100 units a year. And then it would come down the cost curve. And I think we believe that that number can be sub 10 cents a kWh once it gets to scale.
The microreactors, specifically?
The microreactors, could produce power at sub 10 cents a kWh. Now that might be 9.9 cents, but we think it's going to be sub 10 cents a kWh. Once you could build 100 units a year out of a factory over time.
David Roberts
And is that underway? Like, where are we in that process?
Jigar Shah
So these are all names that you've heard of, whether it's like the eVinci from Westinghouse or Oklo, or Radiant Nuclear or USNC.
David Roberts
Yeah. Are these like waiting for approvals or papers or passing tests or are they being built, are they being built somewhere?
Jigar Shah
So they're not being built per se. So Kairos just got through the NRC in record time. These are demonstration reactors, which means that they don't actually power something, they just, you know, prove the concept. And then we have a platform at Idaho National Laboratory that picked three of the reactors and they're demoing there. So I think we're moving quite quickly for nuclear speed. And my sense is the first commercial reactor will be online the day before 2030 for this microreactor.
David Roberts
Just in the nick of time.
Jigar Shah
Just in the nick of time, because I'm seeing real orders being placed here, like, this year or next year. And then you've got to go through the process of finishing. Because the way the nuclear works is the design is always completed on a supercomputer. Then you have to spend, like, $200 million to actually complete the design and convert it into something that has drawings that can actually be built. And you find, like, three fatal flaws which turn out not to be so fatal that you can fix in that process. And then you have to submit to the NRC. So there's steps here.
David Roberts
So your envisioned future then, up to 2030 and post-2030, is both dozens of new large AP1000 plants standardized around a single design and a profusion of microreactors. Is that basically the nuclear future you envision?
Jigar Shah
Yeah. So I would say that I think I have full visibility into, like, four or five new AP1000s and then probably roughly the same number of these sort of four-pack SMRs. And almost all of them are going to be built at existing nuclear sites, because every nuclear plant in the country, I think there's 53 locations right now with the 92 reactors, every one of them was built for four reactors to be there.
David Roberts
Oh, interesting. So there's room. So, we could do a lot more nuclear without any new siting and new —
Jigar Shah
Exactly. You don't need to get a new site permit, all that stuff. And the people who live around nuclear plants love them. Because nuclear plants are very generous. You can imagine they're the highest paying union jobs in the entire clean energy space. If you've ever gone to a high school that with a nuclear plant, they always have, like, a new auditorium and a new swimming pool. So people who live around nuclear plants are huge fans of nuclear power.
David Roberts
Well, I don't know if the Georgian. I don't know if Georgians are huge fans of paying $16 a kWh.
Jigar Shah
But even Georgians, Dave, and I think we should have that conversation, right? Because while I don't wish what — the cost overruns on anyone in the country, I think if you talk to the people of Georgia, the fact that they have won this extraordinary sweepstakes, really, with the IRA and so many people picking Georgia, they absolutely attribute to the fact that they stuck it out with Vogtle.
David Roberts
But then, you know, Tim Echols, a Georgia regulator, electricity system regulator, says, "That was brutal. We're not doing that again unless the feds step in with a cost overrun guarantee, basically, unless the costs are backstopped by the federal government. We're not doing that again." It's what he's been saying.
Jigar Shah
People say lots of things that they shouldn't say out loud. In general, let's be clear about what's in the IRA. The IRA says if you actually are building a nuclear reactor, you get a 30% tax credit. Then if it's in an existing energy community, which all nuclear reactor sites are, you get a bonus 10%. And then if you have majority domestic content, you get another 10%. So, a lot of these reactors are going to get a 50% tax credit.
David Roberts
Good God.
Jigar Shah
On the reactor. So are you really telling me that on the one hand, you got the hyperscale data centers that are willing to pay $115 a MWh for new hydro or geothermal or whatever else, right? So if you don't have the cost shift to rate payers, because these hyperscale data centers are willing to pay that price through a green tariff, and you have exactly what it costs to do the unit for design. So that design is now stable and the supply chain is in place, and workers that know how to build it and all that stuff is there, and you get a 50% tax credit.
You're saying, basically, you're not going to do it without a cost overrun. Now, separately, we are working on the cost overrun. Don't get me wrong.
David Roberts
I mean, a nuclear critic would say this is the very essence of the history of the industry, which is always saying, one more bit of subsidy, one more guarantee, one more thing, and we'll finally have this down. And then you just sink money down that sinkhole endlessly. And they don't live up to their end of the bargain over and over again.
Jigar Shah
Yeah, look, I mean, again, what the federal government's job is, is to lay out all of these factors, which we've done a liftoff report, and I think we're going to update that liftoff report. And then we actually help facilitate these conversations, and I'm doing that every day. As people decide that they want to use loans from our office, we help give them more than just the loan package. We give them the full care and feeding package, and we're helping them through that conversation. Right. But then at some point, someone on the other side has to say that they're willing to step up and do it.
David Roberts
Has the industry heard and internalized this idea about standardization in the industry? Is that now accepted that the lack of standardization is what has sunk previous plants. And what we need going forward is to standardize on one or a very small number of designs. Do they get that?
Jigar Shah
I think their cheeks are very raw from me slapping them upside the head regularly. So they have heard it from me loud and clear. And what I've said to them is that, "Look, I'm a solar guy in the job that was originally created for the nuclear industry," right? LPO started as a nuclear financing 2005. So I take my job seriously and I'm doing it dispassionately. I'm helping everybody equally, and I have to do my part, which is, here's the playing field. I'm designing them, telling everybody exactly what the playing field is. Now, separately, Microsoft and Google are doing their part.
They're writing white papers saying we don't know how to meet our 24 x 7 standard in 2030 without nuclear.
David Roberts
Right.
Jigar Shah
And now the utilities and the regulators and those people have to do their part. Now, it's entirely possible that no one comes to the party and they basically say, "You know what? We just want DoD to build all these reactors." I've talked to DoD. They don't seem to be stepping up for that. But let's see. But I do think that at the core of this goes that modeling exercise that we talked about, which is that when you look at the models from the NREL Clean Futures studies, as well as the Princeton studies, as well as Chris Clack studies, they all say the same thing, which is that the cost of building a much higher penetration solar wind grid means that you have to figure out successfully how to three x transmission.
And we're not on track to doing that. We're on track to maybe 1.8 x transmission if everything goes well. So that means you're now in the transmission constrained scenario, which luckily they actually already ran. And that shows you need a lot more clean, firm generation that better utilizes the transmission that is already there. And there are lots of alternative routes. Right. We could build a crapload of batteries at the point of interconnection for every one of the solar wind farms, so that when there's curtailment, they're instead storing that power and then releasing it slowly. You can imagine all sorts of Rube Goldberg exercises, but I just want to make sure that we're all crystal clear that it's not like this hasn't been studied.
David Roberts
Yeah. One more tech question before I move past the new tech, which is everybody wants me to ask about thorium. I don't have a clue on this planet what thorium is or how it works, but I'm going to get yelled at if I don't ask you about it. So what are thorium reactors and are they a real thing that I need to care about?
Jigar Shah
So the TLDR is: No.
David Roberts
Thank you. Thank you. I wish I'd get that answer more often. Don't worry about it.
Jigar Shah
We don't need to worry about thorium. But thorium is real, right? It's a naturally occurring radioactive material. Found at trace levels in soil and rocks and water and plants and animals. And we've looked at building one. I think they have built one successfully in Russia. And maybe India.
David Roberts
What is the supposed advantage of using it in reactors? What's the hype?
Jigar Shah
I think what a lot of people say is that it's a far more abundant material in certain places and it's less difficult to make right where with uranium you have to use centrifuges and all this other stuff. And so India is blessed with lots of naturally occurring thorium. So if you were to see someone embrace thorium, it would probably be in India. But from the last thing I've read about India, they're now ramping up fission with uranium.
David Roberts
Okay, well, thank goodness that's one thing I'm going to cross off my list of things I need to worry about. So here's my question then. Clean firm is distinct from baseload in the following way: If your purpose is to balance out variable wind and solar, you are by definition going to be doing a lot of ramping up and down. You're not going to be steadily producing at the same level 24 hours a day. And my understanding is that nuclear plants, nuclear power plants want to be generating at a constant level, 24 hours a day, that they are most economic when they do that.
And that the more you vary them and ramp them up and down, the less economic they get. So a lot of people think that basically a baseload style plant is an anachronism in a wind and solar based grid. So are people wrong about nuclear's ability to ramp, or how do you think about that?
Jigar Shah
Well, I mean, we can get into technicalities around the fact that the new designs can ramp, but no, you're absolutely right that if you're going to pay that much money for a nuclear plant, you want to run it 24/7. But remember, nuclear is the exact same thing as solar and wind in opposite. Right? So for solar and wind, what we're saying is we should build 500 MW of solar, build a bunch of batteries, then put it into the grid 24x7 at 100 MW continuous. Right? Because the average solar farm is only a 20% capacity factor and so, fine.
Well, nuclear is the exact opposite. You have like 100 MW, you put in 100 MW continuous. So now there are ways to solve that. In solar, you're putting batteries there. Fine. I don't think anyone thinks that they actually want to build 500 MW batteries for 500 MW of solar. I don't think anyone wants to build 18 hours worth of batteries, they want to build one to four hours of the batteries. Fine. In nuclear, you could do it the other way around. Right? So you could just build electrolyzers and hydrogen behind the fence and make hydrogen every time wholesale market prices are below $35 a MWh because wind and solar are going crazy. You make hydrogen, and then you pump that hydrogen into the marketplace, and then when prices are high, you shut off the electrolyzers and let it go into the grid.
David Roberts
So the idea is the nuclear plant is running all the time, but it's only providing to the grid when it's needed. And when it's not needed, it's doing something else, basically.
Jigar Shah
Totally.
David Roberts
But that assumes your hydrogen, your electrolyzers are economical with variable input. But we don't have to get into that.
Jigar Shah
No, we don't have to get into it. But I guess my point is really just that I think that people are not really wrapping their brain completely around how this whole next phase is going to work. Because when you think about how important the inputs are to this wealth creation that we're going to be creating, the data centers will just pack up and go where they can find 24x7 clean energy. So you could just imagine all 12,000 MW of new data centers — actually, close to 20 GW of new data centers that we need by 2030 — just going behind the fence at existing nuclear plants.
David Roberts
Yeah, I was going to ask about a couple of these people think of nuclear, they think feeding power into the grid, that's sort of the default thing nuclear can do. But there's this Dow project, they have a microreactor that's just producing heat. It's not producing any power for the grid at all. And then there's talk about pairing nuclear with batteries, and then there's talk about pairing nuclear with electrolyzers, making hydrogen, some off-grid nuclear applications. Like, is all that stuff real? Are people looking into all these, the different things you could do with nuclear, other than just feeding power onto the grid?
Jigar Shah
Yeah, I think nuclear, like, my brain that's been well trained on solar works just as well on nuclear in opposite. Which is like, in solar, I'm like, "Okay this is how many GWh I need or MWh I need per year. So I need this big of a solar field, and then I need microelectronics and storage and all these other things so that they have 24x7 power or whatever it is that they need." Right? In nuclear, it's the exact opposite. You're basically like, well, this damn thing doesn't shut off, and so I'm going to keep running it.
And now I need the battery to take the excess, and to be my governor for that. Right? And you can also dump power. Like when I was a kid, I think it was 22, I helped design a wind micro grid in Morocco. And basically they didn't have enough capacity on the grid to take all the wind. And so we created a load bank, and in that case it was ice manufacturing. So, every time there was excess wind, we just made it into ice. And it happened to be a fishing village. So they used the ice to pack the fish and get more money for it.
David Roberts
Right. So you could think of a lot of things you could do with the power that you're not feeding into the grid. Is that arrangement extant anywhere? Like, is there an actual nuclear plant doing that kind of double duty, half on the grid, half off-grid, something?
Jigar Shah
No, not that I know of in the United States, although I don't know about all the nuclear plants in the world. But I'd say that obviously under 45V a couple of the hydrogen hubs are expecting nuclear plants with sort of upright nuclear capacity.
David Roberts
Yeah. 45V — just for listeners — is the hydrogen, clean hydrogen subsidies. And the trick with clean hydrogen is you have to have a new — I mean, this is one of the fights that's going on right now. A lot of the hydrogen producers would like to just attach to existing nuclear plants. But the way the subsidies are structured is you have to have new, additional clean power that you're using, which means you would have to build a new nuclear plant. And is that going to happen? Is somebody going to build a nuclear plant just to make hydrogen? When will that happen?
Jigar Shah
If we're going to build nuclear plants, I do think hydrogen will become a feature by which they can "dump" power when wholesale market prices are low. But separately, remember, many of our nuclear plants can get uprates, right, where you put in new technology, and now it produces 100 MW more power. So that's additional. And we're even starting to get a lot of arguments in for — remember when Constellation had very low wholesale prices twelve years ago, they shut down some of their nuclear reactors because they weren't profitable to keep running. So some of the nuclear reactors are claiming that relicensing of reactors would also be additional.
David Roberts
So who's going to make that decision, whether that qualifies for the subsidy or not?
Jigar Shah
Well, let's just assume it's not me.
David Roberts
Is that the IRS doing that? I've always found it bizarre that the IRS is in charge of that.
Jigar Shah
I think it's Treasury and the IRS together. But I think the intellectual underpinnings of the argument are not wrong in the sense that if they can't find a source of revenue to keep them open, they will shut down. And this is a source — and hydro is the same, by the way. We have 37 GW of hydro that is likely not to be relicensed over the next 15 years.
David Roberts
Really?
Jigar Shah
Unless they get upgraded for like, fish friendly turbines and all the other things.
David Roberts
Interesting. So another thing that I have to ask you about, at risk of getting yelled at by a million people, is waste. I'm sure this is something you run into anytime you speak the word nuclear in public. You hear two different stories about nuclear waste. The old thing you hear is toxic waste that lasts for thousands of years. We don't have a place to put it. It's still all temporary. We still don't have a permanent place to put it. No one wants to be the permanent repository. It's an unsolved problem, et cetera, et cetera. And then the other story you hear more recently from nuke enthusiasts is "Eh, it's not that big a deal, not that dangerous.
The temporary concrete casks are just fine for the time being. Like, it's just not something to worry about." Where do you come down on the waste issue?
Jigar Shah
Well, I mean, let me start by saying the total amount of nuclear waste that we've produced in the entire lifetime of all the nuclear power plants, which we, by the way, still have, the largest fleet in the world of nuclear power plants.
David Roberts
Larger than China's still?
Jigar Shah
Larger than China, for sure. China's got 28 under construction, but our existing fleet is larger. All of it, in cumulative, would be a football field's worth of waste, ten yards high.
David Roberts
Yeah, but —
Jigar Shah
I just want to make sure that we're crystal clear about how much we're talking about.
David Roberts
What does that mean, though? I mean, if it's, like, super toxic and radioactive, then that seems like a lot.
Jigar Shah
Well, what it means is that all of our coal plants in our country have produced ten times more nuclear radioactive waste than our nuclear fleet.
David Roberts
Sure. Well, no one is approaching this by way of defending coal.
Jigar Shah
I'm just saying that I think that for whatever reason, we all have decided that radioactivity is something we should hate. When you take a Geiger counter out in high school, there's radioactivity in the air. So let's just be clear that what we're solving for is to get to ambient radioactivity.
David Roberts
In fact, it's coal power that we should hate.
Jigar Shah
Exactly. So that's point number one. Point number two is that the way that nuclear works is you have highly radioactive waste and then not so highly radioactive waste. By definition, a highly radioactive waste particle means that the half-life is super short, meaning it's like shooting out particles every, like, five minutes. So that waste, when we take a spent fuel rod out of a nuclear power plant, we stick it in a swimming pool that's steel lined, and all of that high frequency waste goes away immediately, right. Because we leave it in there for upwards of a year and sometimes longer.
And so everything that's like ejecting particles every five minutes, their half-life is so short that it's basically gone within a year. And the same thing's true for stuff that's in the middle. So when people say that nuclear waste lasts 1,000 years, that's the stuff that's actually shooting out a particle at a slower rate than ambient radioactivity. Meaning, like, I could make my bed out of it and sleep on it, and I would get more radiation from the atmosphere than I'm getting from the waste. So I just want to make sure that we're crystal clear about how much we should be afraid of waste.
Separately, to your question, yes, Yucca Mountain is not happening. And DOE has decided that it is going to pursue a process whereby we are going to be invited to store waste in certain people's states, as opposed to imposing ourselves on those states.
David Roberts
So, we're giving up on Yucca?
Jigar Shah
Well, I don't know that I'm giving up on anything because I'm not in charge of anything. But I'm just saying that the US Department of Energy has decided that the better way of doing this is to ask people what they want and see whether they want the money, because there's a lot of money that comes with storing nuclear waste. So much money that some states could eliminate all taxes in the state.
David Roberts
Are they lining up? Are they asking, are they —
Jigar Shah
I'm not in charge of that process. But I am sure that we have interest. So there's that, too. Separately, when you think about the 53 sites we have now, plus an additional 20 sites where there was an operating nuclear reactor. But that nuclear reactor is now, since shut down, all of those sites have all of the relevant security measures, et cetera, et cetera, et cetera, to be able to store those casks in a safe fashion where no one's going to get access to it. And in fact, we have had no incidents where some villain from a Bond movie has taken nuclear waste from a nuclear site in this country.
David Roberts
Whereas coal ash pits are out there polluting their asses off everywhere across the country still to this day, despite laws to the contrary.
Jigar Shah
That's right.
David Roberts
So, this sounds like "I don't worry about it too much" take on it.
Jigar Shah
Well, I would modify it to say that "much smarter people than me are on it."
David Roberts
What about reprocessing? This is something else that I have only the vaguest understanding of, is that there's this idea out there that all this spent nuclear fuel still has juice in it and could be used again basically in new types of plants. Is that happening at any scale? Is that a real thing?
Jigar Shah
So, when you take a uranium fuel rod, at the time at which it gets refueled, 95% of the energy of the rod is still there.
David Roberts
No kidding.
Jigar Shah
Yeah. So it's pretty damn good fuel. So it is absolutely the case that reprocessing is something we should do. The French obviously have done it for years. I think the Canadians have a huge number of startup companies that are working there because it's legal to do it there. Like some of them were US companies that then decided to move to Canada to do their demonstrations. And so, my sense is there will come a day when we allow reprocessing, but it's not today.
David Roberts
Okay. We've gone over time. Obviously, we could talk about this for days, but I want to end by pushing you to make some predictions here. Everyone's favorite. When do you think the next nuclear power plant in the US will go into service selling actual electricity and other services? And what type of technology will it be?
Jigar Shah
So the Ontario Power Group, which is not the United States, but it is in our continent, has already decided that they want to build four GE Hitachi BWX 300s. And so they have already filed with their regulator, and they're moving forward on that.
David Roberts
In Ontario?
Jigar Shah
In Ontario, which is right across the border.
David Roberts
It's close.
Jigar Shah
And so I do believe that that project will move forward. And even if they decide last minute to switch to an AP1000 or whatever else, which I'm certainly not hearing any rumors of, but even if weird stuff happens, I do think they're committed to building nuclear at that site, and their regulator is working hard to get full approval to them. So I do think that'll start construction in the next few years.
David Roberts
What do you think are the chances that project comes in on budget?
Jigar Shah
Pretty high.
David Roberts
Yeah.
Jigar Shah
Remember that the Canadians —
David Roberts
Bold.
Jigar Shah
The Canadians have redone their entire CANDU fleet. So they have an entirely trained workforce that has spent the better part of the last ten years in nuclear reactors, upgrading their entire fleet. Their last two CANDU upgrades came in under budget and before the schedule, like three months early.
David Roberts
All right.
Jigar Shah
So I think the Canadians are capable of doing this on time and on budget. But also, I know for a fact that they're padding the budget with, like, a 50% contingency and being super conservative, so they're not lying to themselves. So I think that part's good too.
David Roberts
A nice idea.
Jigar Shah
Right. And then, I think that, like, two years after that, you're going to see someone in the United States start construction as well. So let's call it early '26 in OPG's territory and early '28 in the US.
David Roberts
'28 is when it goes into service. And you think —
Jigar Shah
When it starts construction, and then I think they'll be able to finish it within five years.
David Roberts
So that'll be the 2030s before there's any new nuclear power going into service?
Jigar Shah
For brand new nuclear plants. Yeah.
David Roberts
And your vision, the DOE's vision, or the DOE's, would like for us to basically start, I mean, we're starting from almost still. We're starting from a standstill, almost ramping up rapidly. So the first goes into service in whatever, 32 or whatever, and then a bunch more quickly thereafter. Is the idea, is the hope?
Jigar Shah
Yeah. Remember, I think that the draw for this is very high. So I just want to make sure that we're crystal clear about landing this point. This is not the DOE's wet dream. This is what the hyperscale data centers are saying, that they need to meet their 24 x 7 commitments in 2030. And even the ones who haven't made that commitment. Right, like Apple and Meta and Amazon, are saying that they're at very real risk of not being able to meet their 100% clean energy goals starting in 2027. Because not a lot of the solar and wind folks want to sell to them anymore because they've got other places to sell their power.
So, there is a huge amount of demand for this power from those folks. Now, it's not unlimited. They're not going to pay $200 a MWh for it, but they are willing to pay $100 a MWh for it. Right. So I think it's important to note that there's huge market demand for this. And then, yes, the nuclear industry has to meet them halfway and learn how to do megaprojects in this country again.
David Roberts
Yeah, I mean, are we rebuilding our workforce?
Jigar Shah
Well, we have 13,000 trained people now out of Vogtle, and I hope we don't lose them all. So I'm hoping that someone builds a new reactor soon so that they all don't get other jobs somewhere else.
David Roberts
In geothermal, maybe.
Jigar Shah
Well, we have a lot of oil and gas workers who want to do that.
David Roberts
All right, Jigar, this was awesome. This was fun. This is like the 101. We could probably do a 102 and a 103 and many more.
Jigar Shah
Let's do it.
David Roberts
We'll see how much grief we take for this one, and then we can ... calibrate.
Jigar Shah
Who would know that your top five podcast was going to be a nuclear series.
David Roberts
Oh, my God. I know, I know. Somebody will yell at me. It's always hard to predict too exactly who, but part of the joy of nuclear. All right, thank you for doing this, and thank you again for all your work at LPO. It's awesome. It's a real bright spot.
Jigar Shah
Well, my pleasure. I mean, I think, as you know, we've got the world's best entrepreneurs and innovators in this country, and seeing them choose to commercialize here is a big departure from 10, 15, 20 years ago.
David Roberts
Thank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time.
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