Mr. Atomic Goes to New York for The Future of Energy – Part 1

Early morning in NYC

Early morning in NYC

On April 4 and 5, I had the pleasure of attending the 9th annual The Future of Energy Summit organized by Bloomberg New Energy Finance (BNEF) and held at the Grand Hyatt next door to New York’s Grand Central Station.

The organizing theme of this year’s event, The Age of Plenty, the Age of Competition was quite different from the trends and ideas that influenced the development of the event agendas in prior years. Here’s what the founder of Bloomberg’s New Energy Finance had to say about the selected theme.

“Cheap oil, cheap gas, cheap renewables. There is an abundance of supply that we have not had for decades and this is driving intense competition. It also gives us the theme of the 2016 Summit – the Age of Plenty, the Age of Competition.” ~ Michael Liebreich

It’s not a choice of words that is particularly encouraging for a nuclear energy enthusiast, but the statement energized me to take action. I was fortunate enough to have received and invitation and encouragement from a relatively lonely nuclear energy analyst inside BNEF. Liebreich’s statement told me that I needed to make the investment of time and money to be there.

I wasn’t disappointed.

BNEF had assembled 1,000 influential people representing an interesting segment of people focused on energy as a business, investment, research topic, or a subject for political policy making. Between individual keynotes, panel discussions, breakout sessions and “firestarter” presentations, there were a total of 150 people who spoke at the event. I conversed with a large number of dedicated, prosperous, intelligent, experienced, and well educated people.

I cannot recall speaking to anyone who had current connections to the coal, oil or natural gas industries. Of course, we all arrived via transport vehicles using one of those fuels, ate food prepared using those fuels, sat in climate controlled rooms dependent on those fuels, and used computers, tablets, lights, projectors and phones dependent on power from those fuels.

What was the perceived role for nuclear energy?

Those of us who see a rapidly growing role for nuclear energy, especially in a world where so many opinion leaders talk about the vital importance of addressing climate change by limiting CO2 production in the energy business, were a rather small minority.

There was a lunchtime breakout panel on Nuclear Energy featuring Jeff Merrifield (former NRC Commissioner, Shaw Group executive, and SMR advocate), Maria Korsnick (COO of NEI), Carol Browner (Nuclear Matters), Jay Surina (CFO of NuScale) and moderated by Chris Gadomski (Head of research, nuclear, BNEF). The panel talked about the need to keep existing plants operating, the challenges of operating long term assets in a market driven by short term price signals, the promise of new technologies, and the need for continuing the shift of regulations from prescriptive to risk informed rules focused on outcomes.

Aside: mjd, one of the well-qualified and deeply experienced reactor operators who frequent Atomic Insights, suggests that it would be far more productive if the NRC recognized and took action on “the need for continuing the shift of regulations from prescriptive RULES to risk informed JUDGEMENTS focused on outcome CONSEQUENCES. End Aside.

Leslie Dewan, CEO of TransAtomic gave an excellent firestarter talk about her company’s technology and her mission of turning the existing inventory of 270,000 tons of used nuclear fuel (worldwide) into 72 years worth of power sufficient for all energy consumption for the entire globe. Her talk generated quite a bit of discussion. I can testify that there was a line of press representatives talking with her for an hour or more after she spoke, right up until she had to depart on her evening train back to Cambridge.

Tom Fanning, CEO of Southern Company and one of the most energetic and engaging nuclear company CEOs active today, spoke about his company’s growing satisfaction with its decision to invest in Vogtle units 3 & 4.

Despite all negative news stories to the contrary, the Vogtle project is making excellent progress. The completed project will end up requiring a significantly smaller total rate increase than initially predicted when the final investment decision was made in about 2006 or 2007. Then, the company expected that paying for the two new nuclear units would add about 12% to electricity rates for the company’s customers; now, the expected increase is closer to 7 or 8%.

Even though there have been schedule delays, construction errors and component supply challenges expected in a first of a kind project, the company’s timing has turned out to be excellent. It has experienced much lower interest rates, substantially lower commodity material costs, and lower inflation during construction that initially projected. Those factors play a large role that does not show up in the “overnight” cost calculations that are the focus of negative news reports.

Fanning contrasted that project with the challenges that the company has experienced in building the Kemper County coal plant, a commercial demonstration carbon capture and sequestration (CCS) project.

He said that he was happy that his company accepted the challenge of helping the US restart its large nuclear power plant construction industry. He wouldn’t hesitate to do it over again, even knowing what he knows now about the inevitable difficulty of the task. He is not so sure about the Kemper project. He believes there is little future for CCS without a high price on carbon, something that he does not favor. Fanning is sincerely concerned about the effects of increasing energy costs for the 50% of his customer base with household incomes of $40,000 or less.

Simon Irish, CEO of Terrestrial Energy, attended the event, but I don’t think he was a scheduled speaker. We spoke several times about the similar thinking patterns that we had experienced and about the low level of awareness of the exciting developments that are happening in nuclear technology. We both understand the challenge of communicating our message before there are concrete advanced accomplishments to use as supporting evidence.

Michael Liebreich, the founder and advisory board chairman for BNEF, gave a wide ranging talk sharing his views about the future of energy. Apparently, these talks are a traditional part of the annual event. Here is what he said about nuclear energy during a 20 minute presentation.

Note: Since the quote will make more sense if you see the slides, here is an excerpt from Liebreich’s presentation that includes the slides shown while he was talking about nuclear energy. The numbers in the brackets indicate the slide number.

So Bill Gates has said that in the next 15 years, I expect the world will discover a clean energy breakthrough that will save our planet and power our world. [52] Now there are those people who still think that that is going to be nuclear. U.K. government amongst them. From the left you see Hinckley, on the right, the green line is the expectation of the cost of that power plant, Hinckley. 126 percent of the wholesale power price. [53] It seems pretty clear that current generation nuclear is not the miracle that we’re looking for.

Bill Gates has investing in TerraPower, which is a next generation nuclear player. There are others, in fact, I think in this room, we have the CEO of an innovative potential next generation nuclear power player, Terrestrial Power. Small modular reactors might be a miracle. [54]

If you like your miracles bigger, there’s always fusion. [55] This is what they’re building in France. But the price of even that one project reached the point… They don’t know when it’s going to produce its first plasma and they don’t know how much it’s going to cost. [56] Difficult to see Fusion — not just in 15 years — but even before.

There are other players in fusion if you like your energy technology to look like a death star. [57] That’s General Fusion, Canadian company. If like it really to look like a death star… Perhaps that’s more of a death donut. This thing is called the Wendelstein Stellarator. It’s in Germany. It exists. It’s been built. [58] So Fusion — certainly could fall under the category of a miracle.

And that about covers the formal presence of nuclear energy at The Future of Energy Summit. I took on the self-assigned task of working the crowd to plant disruptive ideas in as many minds as possible. By the measure of collected business cards, I reached a decent cross section of people. Who knows if any of those interactions will have an effect?

There’s more to share, so I’m going to break this event report into several digestible segments. Stay tuned.

Atomic Insights works solely for its readers. If you like having a knowledgeable, pro-nuclear voice at important meetings like The Future of Energy, please consider joining the growing list of generous supporters. Travel costs can be constraining.



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