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Atomic energy technology, politics, and perceptions from a nuclear energy insider who served as a US nuclear submarine engineer officer

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Solar’s dirty secrets: How solar power hurts people and the planet

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By Brian Gitt

Brian’s an energy entrepreneur, investor, and writer. He’s been pursuing truth in energy for over two decades. First, as executive director of a green building trade association. Then as CEO of an energy consulting firm (acquired by Frontier Energy) specializing in the commercialization of technology in buildings, vehicles, and power plants. And more recently he founded UtilityScore, a software startup, that estimated utility costs and savings for 100M+ homes and led business development at Reach Labs developing wireless power. Follow him on Twitter and check out his website.

False beliefs about renewable energy are harming the environment. I say this as someone who championed renewable energy for over two decades—first as executive director of a green building non-profit, then as CEO of a consulting firm specializing in clean energy, and most recently as founder of a cleantech startup. I thought my efforts were helping to protect the environment. But I was wrong.

Like many people, I believed the worst harm to the environment came from fossil fuels—and greedy companies exploiting the land, polluting the air, and destroying ecosystems to get them. It took me many years to realize that this viewpoint is distorted and to admit that many of my beliefs about renewable energy were false. And now I’m ready to talk about what we really need to do to save the environment.

The Truth about Energy

The truth is this: every source of energy has costs and benefits that have to be carefully weighed. Wind and solar are no different. Most people are familiar with the benefits of wind and solar: reduced air pollution, reduced greenhouse gas emissions, and reduced reliance on fossil fuels. But not as many recognize the costs of wind and solar or understand how those costs hurt both the environment and people—especially people with lower incomes.

Looking at Life Cycles

To fully evaluate how solar and wind energy hurt people and the environment, we must consider the lifecycle of renewable energy systems. Every artifact has a lifecycle that includes manufacture, installation, operation, maintenance, and disposal. Every stage in that lifecycle requires energy and materials, so we need to tally up the energy and materials used at every stage of the cycle to fully understand the environmental impact of an object.

Think of a car. To understand its full impact on the environment, we must consider more than simply how many miles it gets per gallon of gas. Gas consumption measures only the cost of operating the car, but it doesn’t measure all the energy and materials that go into manufacturing, transporting, maintaining, and ultimately disposing of the car. Tally up the costs at each stage of the car’s lifecycle to get a more complete picture of its environmental impact.

The same is true of solar panels. To fully understand the environmental impact of solar panels, we need to consider more than simply how much energy and emissions the panels produce during operation. We also need to tally up the expenditure of energy and materials that go into manufacturing, transporting, installing, maintaining, and ultimately disposing of the panels. Once we tally up those costs, we see that solar power leaves a larger ecological footprint than advocates like to admit.

The Environmental Costs of Manufacturing and Installing Solar

Solar advocates often gloss over the solar-panel manufacturing process. They just say, “We turn sand, glass, and metal into solar panels.” This oversimplification masks the real environmental costs of the manufacturing process.

Solar panels are manufactured using minerals, toxic chemicals, and fossil fuels. In fact, solar panels require 10 times the minerals to deliver the same quantity of energy as a natural gas plant.[1]Quartz, copper, silver, zinc, aluminum, and other rare earth minerals are mined with heavy diesel-powered machinery. In fact, 38% of the world’s industrial energy and 11% of total energy currently go into mining operations.[2]

Once the materials are mined, the quartz and other materials get melted down in electric-arc furnaces at temperatures over 3,450°F (1,900°C) to make silicon—the key ingredient in solar cells. The furnaces take an enormous amount of energy to operate, and that energy typically comes from fossil fuels.[3] Nearly 80% of solar cells are manufactured in China, for instance, where weak environmental regulations prevail and lower production costs are fueled by coal.[4]

There are also environmental costs to installing the panels. Solar panels are primarily installed in two ways: in solar farms and on rooftops. Most U.S. solar farms are sited in the southwestern U.S. where sunshine is abundant. The now-canceled Mormon Mesa project, for instance, was proposed for a site about 70 miles northeast of Las Vegas. It was slated to cover 14 square miles (the equivalent of 7,000 football fields) with upwards of a million solar panels, each 10-20 feet tall. It would have involved bulldozing plants and wildlife habitat on a massive scale to replace them with concrete and steel. Environmentalists and local community groups opposed the project because it threatened views of the landscape and endangered species like the desert tortoise, and the proposed project was eventually withdrawn.[5]

Placing massive solar farms far from populated areas presents additional challenges as their remote locations require new power lines to carry energy to people who use it. Environmentalists and local community groups often fiercely oppose the construction of ugly power lines, which also have to get approval from multiple regulatory agencies. Those factors make it almost impossible to build new transmission lines in the U.S.[6] If approval is granted, installing those lines takes a further toll on the environment.

In addition, the farther the electricity has to travel, the more energy is lost as heat in the transmission process. The cost-effective limit for electricity transmission is roughly 1,200 miles (1,930 kilometers.) So you can’t power New York or Chicago from solar energy farms in Arizona.

Limitations to Rooftop Solar

Rooftop solar installations could sidestep some of the problems of solar farms, but they have problems of their own.

First, many buildings are not suitable for rooftop solar panels. Rooftop installations are typically exposed to less direct sunlight due to local weather patterns, shade from surrounding trees, the orientation of a building (which are often not angled toward the sun), or the pitch of the roof.

Second, the average cost to buy and install rooftop solar panels on a home as of July 2021 is $20,474.[7] This makes rooftop installations cost-prohibitive—especially for lower-income families.

Finally, even if we installed solar panels on all suitable buildings in the U.S. we could generate only 39% of the electricity the country needs according to the National Renewable Energy Laboratory.[8]

Solar panels also have a shorter lifespan[9] than other power sources (about half as long as natural gas[10] and nuclear plants[11]), and they’re difficult and expensive to recycle because they’re made with toxic chemicals. When solar panels reach the end of their usable life, their fate will most likely be the same as most of our toxic electronic waste: They will be dumped in poorer nations.  It is estimated that global solar panel waste will reach around 78 million metric tons by 2050[12]–the equivalent of throwing away nearly 60 million Honda Civic cars.[13]

The Human Costs of Solar

Solar harms more than the environment; it hurts people—especially the economically disadvantaged, who face a hard choice between paying high energy costs or suffering energy poverty.

Consider a family of four in California’s Central Valley. They currently pay one of the highest rates for electricity in the U.S.—80% more than the national average.[14] They may be forced to choose between paying for daycare or turning off their air conditioner in 100-degree heat. Families like this are not rare. The California Public Utilities Commission says 3.3 million residential customers have past-due utility bills. Taken together they owe $1.2 billion.[15]

Adding more renewable energy to the grid is not only expensive; it’s dangerous! The North American Electric Reliability Corporation (NERC), a nonprofit organization that monitors the reliability, resilience, and security of the grid, says that the number-one risk to the electrical grid in America is adding more unreliable renewables.[16]

The reliability of a power source is measured by capacity factor. The capacity factor of a power plant tracks the time it’s producing maximum power throughout the year. When we compare the capacity factors of power plants, we see that solar is the least reliable energy source: natural gas is twice as reliable as solar, and nuclear energy is three times more reliable. 

Recent events in Texas and California highlight the risk of adding more unreliable power sources to the grid. The blackouts were caused by several interconnected factors. The Texas power blackout in February 2021 left 4.5 million homes and businesses without power (some for several days) and killed hundreds of people.[17] The immediate trigger of the Texas blackout was an extreme winter storm, but that storm had such a massive effect because of factors rooted in poorly designed economic incentives. Texas wind and solar projects collected $22 billion in Federal and State subsidies.[18] These subsidies distorted the price of power and hence compromised the reliability of the Texas grid. The electricity market is complex. And multiple factors converged to cause the blackout including a failure of government oversight and regulation. But if investments had flowed to natural gas and nuclear power plants instead of unreliable solar and wind, the blackout would likely have lasted minutes instead of days.

Unreliable solar and wind power were also among the three primary factors causing California’s rolling blackouts in August 2020, according to the State of California’s final report on the power outages.[19]

A year later, in July 2021, Governor Gavin Newsom declared a state of emergency and authorized the use of diesel generators to overcome energy shortfalls. And in August 2021, the state announced the emergency construction of five new gas-fueled generators to avoid future blackouts.[20]

Events in California and Texas highlight another unappreciated cost of solar and wind: Compensating for their unreliability requires the use of more reliable sources of power, namely fossil fuels. A study conducted across 26 countries over two decades by the National Bureau of Economic Research (NBER) concluded for every 1 megawatt of solar or wind power installed there need to be 1.12 megawatts of fossil fuels (usually natural gas) as backup capacity because solar and wind are unreliable.[21] Moreover, using backup diesel generators and ramping power plants up and down to meet energy shortfalls are two of the worst ways to use fossil fuels; they’re inefficient and cause unnecessary pollution.

A final point: solar and wind have low power densities. According to a facts guide on nuclear energy from the U.S. Department of Energy, a typical 1,000-megawatt nuclear facility in the United States needs a little more than 1 square mile to operate. Solar farms, by contrast, need 75 times more land and wind farms need 360 times more land, to produce the same amount of electricity.[22]

Even if we could overcome all the practical constraints on storing, transmitting, and distributing solar power, supplying a country the size of the U.S. would require over 22,000 square miles of solar panels[23]—approximately the size of New Jersey, Maryland, and Massachusetts combined.[24] And the unreliability of solar power means that even with that many solar panels, we would continue to need most of our existing power plants.

The Costs of Energy Poverty Worldwide

The less-measured costs of promoting renewable energy extend far beyond California and even the United States. Energy is the foundation of civilization. Access to it enables healthcare, education, and economic opportunity. It liberates men from dangerous jobs, women from domestic drudgery, children from forced labor, and animals from backbreaking work.

Energy poverty, by contrast, leads to malnutrition, preventable disease, lack of access to safe drinking water, and contributes to 10 million premature deaths per year.[25] Over 3 billion people—40% of the Earth’s population—live in energy poverty. Nearly one billion people don’t have access to electricity and use wood or animal dung for cooking and heating their homes.[26] Another billion only get enough electricity to power a light bulb for a few hours a day.[27] Women in energy poverty spend more than two hours a day gathering water[28]for drinking and wood for cooking.[29] And over 3.8 million people die every year[30] from breathing wood smoke while cooking—something which could be prevented by using stoves fueled with propane or butane.

You might think that wealthy nations with a commitment to human rights would take steps to alleviate energy poverty. But exactly the opposite is happening: Wealthy nations are pulling up the ladder behind them and subjecting the developing world to energy poverty.

In 2019, the European Investment Bank announced it would stop financing fossil fuel power plants in poor nations by 2021.[31] And the World Bank (the largest financier of developing nations) is developing a similar policy.[32] The hypocrisy is mind-boggling: wealthy nations get 80% of their energy from fossil fuels and reap the benefits of unprecedented prosperity due to the low-cost, reliable energy they provide.[33]

Weighing the Costs and Benefits

Evaluating the environmental impact of solar panels simply in terms of the CO2 emissions of operating solar panels is like evaluating the environmental impact of a car simply in terms of how many miles it can travel on a gallon of gas. It’s an overly simplistic view that fails to account for all the environmental costs of mining, manufacturing, installing, operating, and disposing of the solar panels.

Once we tally up all of solar’s lifecycle costs, it’s no longer obvious that solar is better for the environment than other sources of energy, including highly efficient natural gas. In fact, solar energy might be worse for the environment after we factor in its unreliability. California’s recent energy crisis illustrates that new solar installations need to be coupled with more reliable sources of power–like natural gas plants–to compensate for their unreliability.

That unreliability is not something that better technology can erase. It’s simply due to the very nature of solar power: the sun doesn’t shine 24 hours a day, so it’s impossible for solar panels to produce electricity 24 hours a day.

Some people theorize that we will eventually be able to store surplus solar energy in batteries, but the reality is batteries cost about 200 times more than the cost of natural gas to solve energy storage at scale.[34] In addition, batteries don’t have enough storage capacity to meet our energy needs. Currently, America has 1 gigawatt of large-scale battery storage that can deliver power for up to four hours without a recharge. A gigawatt is enough energy to power 750,000 homes, which is a small fraction of the amount of energy storage we would need for a grid powered mostly by renewables. It is, for instance, less than 1% of the 120 gigawatts of energy storage that would be needed for a grid powered 80% by renewables.[35]

Manufacturing batteries also takes a serious toll on the environment, as they require lots of mining, hydrocarbons, and electricity. According to analysis completed by the Manhattan Institute, it requires the energy equivalent of about 100 barrels of oil to make batteries that can store a single barrel of oil-equivalent energy. And between 50 to 100 pounds of various materials are mined, moved, and processed for one pound of battery produced. Enormous quantities of lithium, copper, nickel, graphite, rare earth elements, and cobalt would need to be mined in China, Russia, Congo, Chile, and Argentina where weak environmental regulations and poor labor conditions prevail.[36]

The high cost and poor performance of batteries explain why there’s no market for long-duration (eight or more hours) battery storage. Existing battery technology is unlikely to overcome the limits of physics and chemistry in the next decade to come anywhere close to the levels of efficiency we need to store energy at scale.

So adding solar power to the grid will not eliminate the need for natural gas. And when you really examine the harm that solar installations do to the environment, solar begins to look worse for the environment on balance than efficient natural gas plants.

When we add the human costs to the tally, the case for solar looks even worse. Forcing low-income people to pay 80% more for electricity in places like California is ethically dubious and increases wealth inequality. And these are just the costs in developed countries. When we consider the human costs of energy poverty worldwide, using solar to decrease CO2 emissions subjects poor people to unnecessary suffering without substantially reducing climate risk.

Real Benefits of Solar

If you have read this far, you might believe I think solar energy is bad. Nothing could be further from the truth. I think solar is a great technology, but it just doesn’t scale well. When it’s limited to its original applications, it can be a game-changer for many people.  Think of African villages that get a lot of sun but are too remote to justify the cost for building new power lines. Equipping a school, community center, or individual homes with solar panels could be a game-changer and lift many people out of energy poverty.

These are the applications for solar that we should be looking into. But it is wrongheaded to see solar as a replacement for more reliable sources of energy in industrialized, power-hungry nations. That’s an illusion.

But that illusion does make people in developed countries feel good about themselves because it makes them feel less guilty about a lifestyle based on excessive energy consumption. They want to drive nice cars, live in big homes, vacation in exotic destinations, and enjoy all the conveniences of modern life–without worrying that they are hurting poor people and or the planet. 

I’m not pointing fingers. I put myself in this category. It took me years to see that my reasons for pushing solar and wind power were false. I liked seeing myself as a hero defending the environment against ruthless pillagers, and because I wanted other people to see me this way. My false ideas about fossil fuels and renewables were as bound up with my sense of identity and self-worth as they were with my lifestyle.

But I now understand that I was using those ideas as moral camouflage, and I was able to maintain them only by remaining ignorant about the real costs and benefits of different energy sources. That ignorance prevented me from making a real difference.

I’ve dedicated most of my life to protecting the environment. But for years, I was going about it in the wrong way. I thought I was acting morally and protecting the well-being of people and the planet. But in fact, I was harming both, and I see people making the same mistakes today. Governments, companies, and building owners around the world invested $2.7 trillion on renewable energy between 2010-2019, and they plan on investing an additional $1 trillion by 2030.[37] We can make better investment decisions to maximize human flourishing and minimize environmental harm.

What We Need To Do

My message probably stands in contrast to most of what you’ve been told about renewable energy. But I’m convinced that the stakes are too high for me to sit back and not to challenge the false beliefs that continue to fuel poor investments and bad policy decisions. It’s time to stop virtue signaling and take off our moral camouflage so we can meet the problems of climate change and energy poverty head-on.

If we’re serious about tackling climate change, protecting the environment, and helping impoverished people around the world, we need to stop chasing fantasies about solar and wind energy. We need to start weighing all the costs and benefits of all energy sources—wind, solar, natural gas, coal, hydro, geothermal, and nuclear.

Here are five steps we can begin to take towards making things better for both people and the planet:

  • End subsidies and incentives for solar and wind power;
  • Invest in research and development to advance new energy technologies;
  • Build new efficient natural gas power plants (and hydro and geothermal where possible);
  • Reform regulations and build nuclear power plants;
  • Retire the worst coal power plants (5% of power plants create 73% of carbon emissions from electricity generation)[38].

Every day we spend chasing fantasies causes unnecessary harm and suffering. Let’s pursue energy solutions that benefit people and also save the environment.

[1]U.S. Department of Energy (DOE), “Quadrennial Technology Review: An Assessment of Energy Technologies and Research Opportunities” September 2015, page 390https://www.energy.gov/quadrennial-technology-review-2015

[2] J.J.S. Guilbaud, “Hybrid Renewable Power Systems for the Mining Industry: System Costs, Reliability Costs, and Portfolio Cost Risks” University College London, 2016, https://discovery.ucl.ac.uk/id/eprint/1528681/

[3] Stephen Maldonado, “The Importance of New “Sand-to-Silicon” Processes for the Rapid Future Increase of Photovoltaics” October 2020, https://pubs.acs.org/doi/10.1021/acsenergylett.0c02100

[4] Kenneth Rapoza, “How China’s Solar Industry Is Set Up To Be The New Green OPEC” Forbes.com, March 2021, https://www.forbes.com/sites/kenrapoza/2021/03/14/how-chinas-solar-industry-is-set-up-to-be-the-new-green-opec/?sh=1355297a1446

[5] AP News, “Plans for largest US solar field north of Vegas scrapped” APnews.com, July 2021

https://apnews.com/article/technology-government-and-politics-environment-and-nature-las-vegas-nevada-9bf3640dfefbc6f7f45a97c6810f5ff7

[6] Robinson Meyer, “Unfortunately, I Care About Power Lines Now” The Atlantic, July 2021,

https://www.theatlantic.com/science/archive/2021/07/america-is-bad-at-building-power-lines-lets-fix-that-transmission-climate/619591/

[7] Jacob Marsh, “The cost of solar panels in 2021: what price for solar can you expect?” EnergySage.com, July 2021, https://news.energysage.com/how-much-does-the-average-solar-panel-installation-cost-in-the-u-s/

[8] Pieter Gagnon, Robert Margolis, Jennifer Melius, Caleb Phillips, and Ryan Elmore, “Rooftop Solar Photovoltaic Technical Potential in the United States: A Detailed Assessment” National Renewable Energy Laboratory, January 2016, https://www.nrel.gov/docs/fy16osti/65298.pdf

[9] The Solar Technical Assistance Team (STAT), STAT FAQs Part 2: Lifetime of PV, National Renewable Energy Laboratory (NREL), April 2018, https://www.nrel.gov/state-local-tribal/blog/posts/stat-faqs-part2-lifetime-of-pv-panels.html

[10]S&P Global Market Intelligence, “Average age of US power plant fleet flat for 4th-straight year in 2018” January 2019 https://www.spglobal.com/marketintelligence/en/news-insights/trending/gfjqeFt8GTPYNK4WX57z9g2

[11] Energy.gov, Office of Nuclear Energy, “What’s the Lifespan for a Nuclear Reactor? Much Longer Than You Might Think” May 2021 https://www.energy.gov/ne/articles/whats-lifespan-nuclear-reactor-much-longer-you-might-think

[12] International Renewable Energy Agency (IRENA), “End-of-Life Management Solar Voltaic Panels” 2016 https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2016/IRENA_IEAPVPS_End-of-Life_Solar_PV_Panels_2016.pdf

[13] “Honda Civic Features And Specs, Weight Information, 2021” CarandDriver.com, https://www.caranddriver.com/honda/civic/specs

[14]Laurence du Sault, “Here’s why your electricity prices are high and soaring” Calmatters.org, March 2021,  https://calmatters.org/california-divide/debt/2021/03/california-high-electricity-prices/

[15] California Public Utilities Commission, “Energy Customer Arrears 2020 Status Update and New Order Instituting Rulemaking, January 2021 https://www.scribd.com/document/495707616/Residential-Energy-Customer-2020-Arrears-Presentation-for-Voting-Meeting-Update-Jan-2021

[16] Reliability Issues Steering Committee, North American Electric Reliability Corporation, Ranking of Identified Risks, page 49, January 2021, https://www.nerc.com/comm/RISC/Agenda%20Highlights%20and%20Minutes/RISC_Meeting_Agenda_Package_Jan_28_2021_PUBLIC.pdf#search=reliability%20risk%20ran

[17]Peter Aldhous,  Stephanie M. Lee, Zahra Hirji, “The Texas Winter Storm And Power Outages Killed Hundreds More People Than The State Says” BuzzFeed News, May 2021 https://www.buzzfeednews.com/article/peteraldhous/texas-winter-storm-power-outage-death-toll

[18] Robert Bryce, “The Texas blackouts were caused by an epic government failure” The Dallas Morning News, August 2021, https://www.dallasnews.com/opinion/commentary/2021/08/01/the-texas-blackouts-were-caused-by-an-epic-government-failure/

[19] California ISO, “Final Root Cause Analysis Mid-August 2020 Extreme Heat Wave” January 2021 http://www.caiso.com/Documents/Final-Root-Cause-Analysis-Mid-August-2020-Extreme-Heat-Wave.pdf

[20] Mark Chediak and Naureen S Malik, “California to Build Temporary Gas Plants to Avoid Blackouts” Bloomberg.com, August 2021, https://www.bloomberg.com/news/articles/2021-08-19/california-to-build-temporary-gas-plants-to-avoid-blackouts

[21] Elena Verdolini, Francesco Vona, and David Popp, “Bridging the Gap: Do Fast Reacting Fossil Technologies Facilitate Renewable Energy Diffusion?” National Bureau of Economic Research, July 2016 https://www.nber.org/system/files/working_papers/w22454/w22454.pdf

[22] Energy.gov, Office of Nuclear Energy, “The Ultimate Fast Facts Guide To Nuclear Energy” January 2019, https://www.energy.gov/sites/prod/files/2019/01/f58/Ultimate%20Fast%20Facts%20Guide-PRINT.pdf

[23] Energy.gov, Solar Technologies Energy Office, “Solar Energy in the United States” September 2021, https://www.energy.gov/eere/solar/solar-energy-united-states

[24] StateSymbolsUSA.org, “States by Size in Square Miles” https://statesymbolsusa.org/symbol-official-item/national-us/uncategorized/states-size

[25] World Health Organization (WHO), “Health Topics” https://www.who.int/health-topics

[26] The World Bank, “Energy Overview” https://www.worldbank.org/en/topic/energy/overview 

[27] Todd Moss, “Ending global energy poverty – how can we do better?” World Economic Forum, November 2019, https://www.weforum.org/agenda/2019/11/energy-poverty-africa-sdg7/

[28] “UNICEF: Collecting water is often a colossal waste of time for women and girls” Unicef.org, August 2016, https://www.unicef.org/press-releases/unicef-collecting-water-often-colossal-waste-time-women-and-girls

[29]“ ENERGIA, World Bank—Energy Sector Management Assistance Program (ESMAP) and UN

Women, United Nations, Policy Brief #12 Global Progress of SDG 7— Energy and Gender” 2018, https://sustainabledevelopment.un.org/content/documents/17489PB12.pdf

[30] World Health Organization (WHO), “Household Air Pollution” 2021, https://www.who.int/health-topics/air-pollution#tab=tab_3

[31] BBC.com, “European Investment Bank drops fossil fuel funding” November 2019, https://www.bbc.com/news/business-50427873

[32] Bernice von Bronkhorst, “Transitions at the Heart of the Climate Challenge” The World Bank, May 2021, https://www.worldbank.org/en/news/feature/2021/05/24/transitions-at-the-heart-of-the-climate-challenge

[33] Robert Rapier, “Fossil Fuels Still Supply 84 Percent Of World Energy — And Other Eye Openers From BP’s Annual Review” Forbes.com, June 2020, https://www.forbes.com/sites/rrapier/2020/06/20/bp-review-new-highs-in-global-energy-consumption-and-carbon-emissions-in-2019/?sh=1dbd154666a1

[34] Mark P. Mills, “The New Energy Economy: An Exercise in Magical Thinking” Manhattan Institute, March 2019, https://www.manhattan-institute.org/green-energy-revolution-near-impossible

[35] National Renewable Energy Laboratory (NREL), “Renewable Electricity Futures Study” 2012, https://www.nrel.gov/analysis/re-futures.html

[36] Mark P. Mills, “The New Energy Economy: An Exercise in Magical Thinking” Manhattan Institute, March 2019, https://www.manhattan-institute.org/green-energy-revolution-near-impossible

[37] United Nations Environment Programme with Frankfurt School & Bloomberg NEF, “Global Trends in Renewable Energy Investment 2020”, Key Findings, 2020, https://www.fs-unep-centre.org/wp-content/uploads/2020/06/GTR_2020.pdf 

[38] Alex Fox, “Just 5 Percent of Power Plants Release 73 Percent of Global Electricity Production Emissions” Smithsonian Magazine, August 2021, https://www.smithsonianmag.com/smart-news/five-percent-power-plants-release-73-percent-global-electricity-production-emissions-180978355/

What makes smaller nuclear power systems so exciting?

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Let me start by dispelling the notion that I think smaller, modular, manufactured nuclear power systems – often called SMRs or micro reactors – are the be all and end all solution to anything, including climate change or energy security.

Though not THE solution, they have the potential to be a crucial, uniquely capable part of a fully-integrated, 0% emission climate-solving grid. 

The best of the breed build on lessons from aircraft manufacturing, submarine construction, electric vehicles, wind & solar and even computers. They are leavened with six decades worth of experience in building, operating and maintaining extra large nuclear systems. They address some of the public relations challenges that have plagued very large reactors.

Some of the system designers are paying close attention to the social science lessons and teachings of groups like “The Good Energy Collective” and designing their systems with customer needs and wants in mind. They often state that they are planning to build reactors that people want to buy. Many of the people or communities interested in buying those reactors are planning to live, work, and play right next to the power system. (Regarding the “play” part of that statement – at least one of the proposals I’ve seen includes directing the waste heat from the power system to a community swimming pool.)

Economy of series production & operation

As former submarine engineer officer who also had the rare opportunity to plan and budget for fleet level nuclear power training, maintenance and construction programs, I have a personal understanding of how economies of series production and standardization work to help keep costs under control and schedules predictable.

It is enlightening to see how much costs fall when you can train a group of operators in a common speciality and send them out to several dozen plants that have identical equipment, spare parts lockers and layouts. It’s also easy to see how maintenance procedures can be written once and used by all and how alterations can be planned, reviewed and implemented. These are just a few of the examples I can list. Rules protecting confidential information prevent me from sharing quantified details. Space prevents me from listing other examples.

It shouldn’t surprise anyone who has made anything that people learn to do things with experience or that doing the same thing repeatedly produces better results the more often the task is done. Those learning curve-related improvements don’t require mass production of thousands or millions of units, they start improving cost and performance with the second unit.

Widely cited literature from thought leaders like Clay Christensen (Innovators Dilemma and other works) show that there is a relation between costs and doubling of cumulative unit production.

The modern renewable industry – wind and solar energy collection systems – demonstrate the utility of replication. Starting from the high cost systems of the early 2000s, the industry took advantage of tax credit and mandates originally designed to help them build markets and achieve scale economies. Their impressive cost reduction performance is more attributable to the economy of learning by doing than it is to technological innovations and new inventions.

Aside: Some of the techniques used for the dramatic cost improvements in wind and especially solar power systems are not actions that we will to use to drive down nuclear costs. The sector has an admirable tradition of paying living wages to people who eagerly accept the responsibilities that come with high quality work and a strong safety culture. It also does not concentrate its manufacturing in countries with lower standards. End Aside.

Of course, cost and schedule improvements that result from experience can be lost, team relationships can be broken and skills can atrophy with a lack of practice. Smaller nuclear power systems will not be immune to these advantages and vulnerabilities. But unlike far larger plants that might be able to serve five, ten, or even fifteen years worth of electricity demand growth with a single unit, smaller systems will need numerous units to be steadily brought into service.

Smaller nuclear systems do not replace extra large power plants

Some challenge the idea that we should add small reactors to our product catalog. They believe that we know how to build large reactors, we have proven that we can operate them with incredible safety records and each one can make a big difference in both energy supply security and CO2 emissions. They claim that smaller reactors make the tasks more difficult and that many of the smaller reactors still need many years of operating experience to catch up with larger units.

SMRs and micro reactors are not intended as replacement products for situations when customers want large or very large power units. They are an addition to the options list for those who want or need their power in smaller quantities or who want to learn how to build and operate nuclear plants in a more gradual fashion.

Some object to those of us who characterize modern nuclear power systems as “advanced” because they claim we have done them all before. While it is true that world nuclear energy history includes projects that envisioned or actually used many of the potential combinations of fuel form, coolant, fuel enrichments, and secondary power systems, it isn’t true that they explored all available technological advances. Today’s designs benefit from innovations and developments that were not available back when some of the original research and testing was done.

The fact that there was a thriving market for electric cars that took off in the 1890s, even before the Model T years, does not make the Tesla any less advanced of a vehicle.

Aside: There are numerous smaller and micro reactors that are already in operation today. Two most recently completed examples are Russia’s Akademil Lomonosov and China’s HTR-PM. But the hundreds of reactors that have propelled naval vessels in a half dozen or more countries for decades also demonstrate many of the principles that make commercial SMR worthy of excitement. Indian PHWRs also have many of the characteristics of modern SMRs, including power rating. End Aside.

Note: The Wright Brothers and Henry Ford built internal combustion engines 120 or more years ago. That does not negate the statements by current automobile manufacturers that their power plants are advanced or modern. Modern electric vehicles may be descended from earlier products built on roughly the same combination of features, but they are still marvels of advanced technology.

Security, Insurance and Non-Proliferation

Some claim that rules aimed at ensuring security and preventing the proliferation of nuclear weapons will make smaller systems unaffordable. They overlook the efforts that are going into the system designs to make security easier to implement, the ways that safeguards are being designed into the systems and the fact that some of the rules are being changed because responsible leaders have recognized that they do not actually improve safety or security. Some of them were implemented with the express purpose of slowing nuclear energy development. The immediacy of climate change is stimulating efforts to identify and alter requirements that serve primarily to undermine nuclear economics.

There are even some who cling to the shibboleth claiming that nuclear energy is somehow subsidized because it has a specially designed group insurance program under the 1957 Price Anderson Act (as amended over the years.) While there are changes needed in that Act, it has never been a subsidy for nuclear energy. The truth is that insuring nuclear power plants has never cost taxpayers a dime in paid damages and the insurers that specialize in providing the required commercial insurance have been hugely profitable by collecting premiums and rarely, if ever, paying a claim.

When opponents point to the long-term costs of the accident at Fukushima Dai-ichi as a reason to believe that nuclear plants are under insured, they have some basis in fact. But most of the nuclear-related cleanup costs associated with that accident have been self imposed by the Japanese national, prefecture and local governments. They set radiation exposure standards that were much more stringent than already conservative international standards. Simply using international standards for radiation doses would have greatly reduced evacuation and relocation costs. Basing those actions on a more complete understanding of radiation and its risks would have virtually eliminated costs of actions taken outside of the plant fences.

Rebuilding an area decimated by an earthquake and tsunami isn’t cheap, but it shouldn’t be attributed to events at an industrial facility that did not harm its neighbors.

Are SMRs a good investment?

The answer is, it depends. As with every industry that is experiencing a new generation of technological innovation, some entrepreneurial teams are progressing well, successfully pitching their vision to investors, building their teams, executing against their milestones, learning from set-backs, adjusting to regulatory and market conditions and keeping their eye on the ball. And others not so much.

At Nucleation Capital, the partner team has a combined total of several decades spent investigating and observing the growing potential for advanced nuclear power production. We know that nuclear energy is clean enough to run inside sealed submarines full of people and safe enough for caring parents to not worry when their children work in close proximity to an operating nuclear power plant. We also know that commercial nuclear plants have amassed an admirable safety and reliability record.

That gives us tremendous hope and confidence that great teams will emerge that can learn from our historical performance, from the navy and otherwise, and that new designs will emerge that competitively meet the challenge to deliver clean energy reliably and cost-effectively with newer implementations of amazing carbon-free technology. But we also recognize that not every design will work as hoped or be well-suited to the market demand that exists. Not every team will have what it takes to be successful in a complex market.

Furthermore, we understand the concerns that many people have about the unknowns regarding new designs and the risks of deploying many more small reactors in an widening array of applications. Just as with the deployment of electric vehicles which cannot succeed on the basis of a car design alone but must be matched with a robust national grid of charging stations, this next generation of nuclear ventures will need to solve for an array of related challenges, including nuclear fuel production, long-term waste handling and storage, spent fuel transportation and reprocessing, among other things.

Fortunately, there are quite a lot of groups and entities that are eager to work on these issues, so that new nuclear systems can help us address climate change, provide humanity with reliable power in a climate-stressed world and also succeed in winning public support. There are valid concerns and there are good ways to address them. We also believe that we will have more success overcoming these concerns if coalitions of people across all spectrums participate in helping to solve them collaboratively. 

We are very pleased to be in a position to talk with founders, get briefed on detailed, often non-public information and discuss with them their development goals and challenges, as well as their experiences dealing with a range of potential funders, regulators, suppliers, strategic partners and potential customers. 

Of course, we cannot be specific about those interactions, but we can express how confident and energized they make us feel for this next generation of reactor developers to broaden the zero-carbon toolset to help reverse the trend of ever increasing CO2 emissions. In the foreseeable future, those new designs will likely contribute to the gargantuan task of reducing the existing emitted inventory of over a trillion tons of greenhouse gases already afflicting our climate, by working in combination with a range of carbon capture and removal technologies.

Our investments do not give us a “conflict of interest.” Rather, we believe they give us a broadening window into the future of decarbonization. We will continue to work with the ventures in our portfolio to help them navigate in the ever-shifting policy, regulatory and investment environments. We will keep our eye on the progress towards commercialization goals and continue to drill down into technological and competitive progress being made, so we can better determine our future investment activity.

We are not policy makers nor government officials. We have “skin in the game.” We will be participating to the extent of working to make sure that the developing advanced nuclear energy industry focuses on meeting customer needs and wants and ensuring that there are cost-effective methods for delivering these over the longer term.

We are also enthused by the opportunity to expand the world of “clean energy” and “climate tech” investing to include nuclear energy. We know that a large portion of the clean, near zero-emission energy produced in the world today comes from long ago investments in nuclear power plants that have been operating reliably for decades. While some look at the hiatus in new builds and believe it indicates that nuclear power is on its way out, we look at the same hiatus as the impetus to improve upon and achieve major strides towards perfecting this extraordinary but still overlooked technology. We will be working our hardest to make sure that we and our investors are able to participate in the growth and success of those ventures which best meet the climate challenge with the right set of products and services.

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