Dieter Helm has generously shared an April 2013 article written for Prospect Magazine titled Stumbling towards crisis. In that article Helm points to US energy decision making as a good example that serves as a contrast to UK energy policy making. He sees chosen path in the UK as almost guaranteeing a crisis. In his view, the lack of an official government policy that attempts to pick winners and bureaucratically determine special price points for each competitive technology has enabled the US to move forward smartly with a program that is both reducing energy costs and reducing CO2 emissions.

Helm is onto something, but his preferred solution of using natural gas as a bridge fuel is bound to lead to a half built bridge to nowhere. Nuclear energy offers a solid path to a sustainable future, but nuclear energy advocates and business leaders need to take action to solve the biggest hurdle inhibiting atomic abundance. Helm points the way in the following passage, but his directions are not as useful as they could be with a little refinement.

The nuclear saga cannot go on. For 12 years governments have decided that they don’t want nuclear, and then that they do, that nuclear needs no public subsidy and then that it does, and that a waste solution should be found first, and then that it is not urgent. The current approach to nuclear is a close replica of that of the late 1970s. The plan is to try out a number of different technologies and providers and see if they work. so Hitachi is pitched against EDF, with Westinghouse in the background. It is time to recognise that nuclear is a political technology that requires a long-term political consensus and a national industrial policy for its supply chain. Either do it properly or don’t do it—but the middle way
looks at best very expensive.

I find it almost amusing that Helm seems to be suggesting that the correct path for nuclear energy is by government fiat – which is the approach that has not worked very well. The proper way to develop nuclear energy’s full potential is to follow the path that has led to the successful development of all other fundamentally disruptive technologies. We need entrepreneurial leaders that have made a focused decision to take full advantage of the unique capabilities that the technology offers so that they can crush the incumbent players.

Those leaders need to be “all in”; they cannot engage in a half-hearted attempt to make nuclear somewhat competitive by following all of the existing rules and making only marginal changes in heat source and heat engine designs that work well when the fuel is coal, oil, or natural gas. They also need to make friends with others who have made the same basic technical choice and not engage in destructive competition against other nuclear energy entrepreneurs who do not have much market share to take anyway.

Some nuclear energy business leaders may come out of the fossil fuel industry or out of the established “nuclear” industry, just as some leaders in personal computers started their careers in the mainframe business. However, it is becoming increasingly clear to me that a large portion of the leaders must be people who are frustrated by the old ways and unsatisfied with the lack of progress that is often a result of being reluctant to overturn the generous gravy train that keeps the energy establishment in power. Helm is aware of this challenge as shown in this passage from earlier in the article:

Unfortunately, the incumbent companies have little incentive to come to the rescue. Higher prices mean higher profits. In most markets, high profits attract entrants. Investment by the private sector is, however, a voluntary activity, as the government is discovering. In energy, that investment takes time. Security of supply is a system problem, and not necessarily a problem for the incumbents. For them, it is better if nobody invests, giving them much higher returns on their existing power stations. After a decade of unprecedented mergers and acquisitions—coupled with a good dose of financial engineering—most of the big players are in poor shape to do much investing anyway.

Aside: Helm is not talking specifically about nuclear here, but I think that the thought process applies. He also does not help people understand that about 60-90% of the revenue associated with fossil fuel power generation goes to the fuel supplier, not the power station owner. They are really the companies (and individuals) that benefit when no one builds new power plants. New plants are either more fuel efficient or do not use any fossil fuel at all. That is one of the many reasons I am generally suspicious of people who claim that restricting demand growth is the cheapest way to a better energy future. Market stagnation solidifies the position of the established players. End Aside.

Many of the technical people in the new nuclear industry must have solid foundations in current power generation and heat utilization technology, both nuclear and fossil fuel, but they need to be willing to dig deeper. They must learn more about the unique economic and design opportunities associated with an incredibly energy dense fuel that produces zero atmospheric pollution and costs less than 1/3 as much per unit of heat than the cheapest of its competitors. They must be willing to use new paradigms and techniques and to adopt good ideas that may have been invented somewhere else.

The leaders must also recognize the political aspects of the technology and be unafraid to take advantage of skillful marketing that takes direct aim at the long line of dark grey suits that represent the established energy industry. (Just in case the allusion is not clear to all readers, here is a clip of the famous Apple Computer Super Bowl commercial from nearly 30 years ago.)

Today there is a long line of natural gas cheerleaders and an equally long line of people who seem to accept the notion that directly burning cheap lignite is an acceptable long term energy solution. Focused leaders who have a deep understanding of nuclear technology, politics and human nature need to be willing to throw hammers that may result in some blowback. They must keep pressing forward to develop the energy supply products that their customers want – even if they don’t yet know it.

The world’s energy consumers deserve reliable, emission free, power sources that simply work. They want those amazing systems to be delivered at a surprisingly affordable cost. We need to develop the supply chain, market the technology, and build amazing products that are fully integrated systems that customers really want to buy.

PS – As a bonus, Helm’s posting of his Prospect article includes a revealing commentary on solar energy as a scam that is making a certain type of investor rich. Here is a quote from a column titled “Is Solar Still Worth It” that is on the same page as the last page of Helm’s PDF copy of his article.

Being the sort of investor who likes someone else to take the risk and leave me with the reward, I didn’t take much persuading to call in the solar panel installers in spring 2010.

In this case, the “someone else” happens to be all other taxpayers and electricity rate payers. I personally find the author’s attitude to be incredibly self-centered and bordering on immoral.