An increasing number of investors are concerned about the impacts of carbon emissions on the climate. They wish to avoid investing in businesses which contribute to the problem. According to the CDP Carbon Majors Report of 2017, nearly all of the industrial carbon emissions since 1988 have come from the top 100 fossil fuel producers. This explains why most of the funds seeking to implement a “climate” screen simply avoid fossil fuel companies. While that is a relatively easy way to avoid investing in companies that cause the problem, what is harder is filling in that portion of the portfolio which needs to represent the energy sector. In looking at this problem, we saw that the largest segment of the economy which produces clean energy and is represented in public equities, is the nuclear energy industry.
Nuclear power is carbon-free energy which today provides 20% of our electricity, over 60% of our clean energy and which supports a plethora of industrial, commercial and medical applications. Energy investors, recognizing the demand for clean energy, have focused on renewables, storage and efficiency and have largely avoided recognition of nuclear energy’s contributions. The experts, however, have warned that in order to displace enough fossil fuels to meet the Paris COP goals, nuclear power must be expanded along with the other much more dilute forms of low-carbon generation. Unfortunately, traditional nuclear power, now in its third generation and sized at the gigawatt+ level, requires enormous up-front capital commitments and a long time frame for project completion, which partially explains why there are only two reactors being built in the U.S. It does not readily fit into the tight budgetary capabilities or demand-growth profiles of many jurisdictions.
Fortunately, a new generation of nuclear physicists, engineers and entrepreneurs are working to bring nuclear power into the 21st century by offering a vastly more energy flexible, modularly-sized and cost-effective range of nuclear reactors designs. These novel, fourth generation designs seek to improve substantially upon current operating characteristics to enable future reactors to provide electricity or high-temperature heat for industrial purposes, be sited underground, use alternative coolants rather than water, even to be able to use spent fuel “waste” from prior generations.
Since 2001, the numbers of students graduating with PhDs in nuclear engineering has steadily grown, creating a resurgence of talent, R&D, and a significant number of nuclear start-ups, spin-outs from academia and joint ventures. What is now called “Advanced Nuclear,” is an emerging technology sector that is working on both new applications and revolutionary nuclear power redesigns. This new sector has enormous potential to add flexible zero-carbon power to energy grids, meeting the dynamic power and energy stabilizing needs of advanced grids as well as many other energy applications.
In contrast today’s nuclear power utilizes the light water reactor, a 1960s-era design that was originally intended to power submarines, where high pressure and abundant cold water are innate features. Despite the challenges of replicating an underwater environment on land, Generations II and III didn’t move away from the light water design. They added additional layers of redundant safety systems and physical separation, which vastly increased new construction costs. In the post-Three Mile Island era, regulators and industry prioritized safety at the expense of cost-effectiveness and transformative development.
ABOUT ADVANCED NUCLEAR
Fast-forward to the 2000s. Concerns about climate change have amplified efforts to reduce humanity’s burgeoning carbon emissions, challenging a new generation of physicists to scour the public data from some fifty-two previous National Lab designs, some known for having had innate safety advantages over the light water reactor. Today, around the world, nuclear engineers equipped with advanced modeling software, miniaturization, advanced materials, artificial intelligence (AI), blockchain and other tools, are in a global race to develop the best advanced energy solutions to meet a range of needs.