Why did the Carbon Free Power Project get cancelled? What does that mean for NuScale? 1

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  1. NuScale is a product of sheer will (DOE will), not a more economical solution. So, now we have 7 licensed designs to build anytime we have that cosmic realignment of values in our society that earnestly supports middle class jobs, reliable power, and low CO2 production. A society grows great when old men build nuke plants in whose power they will never use. We have a banking and finance problem. I’ll vote for anybody that gets 4 units under construction in the next 5 years.

  2. Nuclear is off the wrong start for many reasons.
    One of the biggest is that they are attempting to start this all wrong.
    Far better ways to do it.

    While I am opposed to 3rd gen and esp. thermal reactors, it is sad to see this one fail when with a few modifications they could have made it work economically.

  3. Looks like time to buy more SMR stock. Unsolicited advice for NuScale. Focus on markets that need reliable power more than the cost of the electricity. Trying to build a 12 pack is not the best place to start. Once you actually have some units built and producing, money will flow and costs should drop.

    If Nuclear can’t compete on cost it will not make any difference in the world. Last Energy has the best business case I’ve seen. I sure hope they succeed in building truly small modular construction reactors using existing tech.

    1. “Last Energy has the best business case…”

      This assertion is absurd. Here we have NuScale, a billion dollar certified design, far enough along in the detailed design to be honest about overnight costs, being compared to a building rendering on Brett Kugelmass’ website. You show either naivete about or affiliation with the effort – either way it lowers the quality of this discussion.

      If NuScale can build 12, they can build 6, 4 or 1. The problems are that each NS reactor: 1) represents a revenue stream of just $47M/year at zealous European prices, 2) requires the same licensed staffing of a 1.2GWe unit, 3) the federal interest rate is 5.5% today, etc…

      1. “… each NS reactor:… 2) requires the same licensed staffing of a 1.2GWe unit…”

        The licensed staffing of just 1 NS reactor is sufficient for licensed staffing for up to a four-pack unit. No additional licensed staffing is required, under the currently approved process.

        1. https://www.nrc.gov/docs/ML2022/ML20224A521.pdf

          I see 6 licenses in the control room for 1 to 12 units making as little as 77 MWe, as much as 924 MWe. The ruling would have required 6 licenses in the UAMPS control room for 6 units making at best 462 MWe.

          4 licenses in the control room for a single large LWR typically making at least 1GWe,
          5 licenses in the control room for a dual large LWR typically making at least 2GWe.

          The NuScale business case is full of over-unity multipliers like this…. all over the balance sheet. More licenses, less power, more steam plants, less power, more turbines, less power, more condensers, less power. As they age, they’ll undoubtedly require more maintenance. There will be 1 unit of 12 in refueling at any given moment so the 924 MWe becomes 847 MWe. Despite the NuScale rebuttal to MacFarlane and Krall, the NuScale reactor will indeed use 110 tons of Uranium across 12 reactors to generate less power than an 88 ton 4-looper makes, and discharge the fuel with significantly less burn… These numbers may be backed out of the NuScale DCA.

          I don’t doubt they’ll build a few, but NuScale doesn’t improve the economics – it won’t catch on.

          1. Michael

            Subsequent to the design certification document that you referenced, the NRC approved NuScale’s Topical Report titled “NuScale Control Room Staffing Plan.” (TR-0420-69456)


            That report lays out an alternative, task analysis based methodology to determine minimum staffing levels. According to the approved topical report the “analysis employed an alternative approach to control room staffing in lieu of 10 CFR 50.54(m), that was conducted in accordance with the applicable NRC guidance contained in NUREG-0800, Chapter 18; NUREG-0711; NUREG-1791; SECY-11-0098; and NUREG/CR- 6838.”

            It’s a detailed document, but the final result is that NuScale has been approved to operate up to 12 modules from a single control room with a single senior reactor and two licensed operators with NO STA.

            “This topical report provides the technical justification for an NPP to be operated with a minimum operating crew of three licensed operators and no shift technical advisor (STA). Two of those operators perform the roles of reactor operator 1 and reactor operator 2. The third operator performs the role of shift manager and control room supervisor. NUREG-0737 (Reference 8.1.6) states “the need for the STA position may be eliminated when the qualification of the shift supervisors and senior operators have been upgraded and the man-machine interface in the control room has been acceptably upgraded.” These conditions have been met in the NPP, and the minimum operating crew of three operators does not include the STA role (see Table 6-1).
            To validate the staffing plan, NuScale conducted high-workload, performance-based, staffing plan validation tests to provide assurance that the licensed operator control room staff complement is sufficient to safely operate an NPP with up to 12 modules.”

      2. Yep, Last Energy has the best business case. I guess I am just naive. No affiliation. I am doing my best to lower the quality of the conversation.

        1. A billion dollar certified design – well not really needed. saved that billion. Is there any real value added by the NRC? It does a great job of protecting the jobs of people testing minor amounts of radiation. Also the jobs of people who get to imagine ways that a NPP could fail that have NO physical basis in reality. Much else? A working design is much more valuable than a certified one. Especially if you get to start building that design and making money from it in a few months rather than 10 years.

        2. The detailed design – Ok, he decided not to share all the details – he has shared that he is purchasing off the shelf components. Is it really that hard to fit them all together in a way that works ok? In the 1960’s we had several non-nuclear companies build NPP’s. After 15 years of reading designs, I am convinced that the hard part is not the design. The hard part is finding a way to build them that makes money, right from the start.

        SOO your last point is the right one.
        “If NuScale can build 12, they can build 6, 4 or 1. The problems are that each NS reactor: 1) represents a revenue stream of just $47M/year at zealous European prices, 2) requires the same licensed staffing of a 1.2GWe unit, 3) the federal interest rate is 5.5% today, etc…”

        If Brent can build a 20 MW plant for the $100 million he claims. He will have a money printing machine.
        1) A gross revenue stream of at least $20M / year at $.15 / KWH which is the delivered cost in Poland. By using close sites the plant can charge more than typical distant ones since the delivery is not expensive.

        2) A MUCH smaller staff. There is NO reason a 20 or 75MW plant requires the same licensed staffing as a 1.2 GWe plant. (Why thank you NRC). Natural Gas plants require about 25 employees. Is there any reason for more in a NPP? Yes a staff of 200 will eat up everything for a small plant A staff of 800 will eat up nearly everything for a large one. Why is terrorism a larger threat at a NPP compared to a Natural Gas plant? Only one can go boom with a huge fireball. The other goes sort of pop (when a president refuses to allow it to vent on time). (Yes, yes I know, we have to exaggerate the radiation dangers so people can keep their high paying jobs running around with meters).

        3) NuScale is not borrowing at this point – they are raising funds through stock sales. Brent is not borrowing but using venture capital and power purchase agreements. Yes 5.5% is higher than it has been, but not really high for short term loans on smaller amounts.

        4) I am invested in NuScale. I keep buying when I have available funds. I really believe they will do well in the next 10 years. I think Brent has a better business case. I wish I could invest.

        1. David:

          Atomic Insights doesn’t have a “like” button, so I guess I need to make a bit of a supporting comment.

          You and I agree on almost all of your points. I’ll summarize my position – nuclear professionals that are steeped in “nuclear safety culture” often fail to recognize that they are victims of “nuclear exceptionalism.”

          All manufacturers of pressure vessels and high pressure components operate using the same basic codes and standards from ASME. That includes nuclear pressure vessel manufactures, but those have also accepted a deeply layered set of additional requirements that add very little to the resilience of the vessels and their probability of failure. (In some cases, the N-stamp holders have tacitly or overtly added to the layering as a means of protecting the value of their investment in obtaining and maintaining their N-Stamp.)

          Last Energy is focusing on the right challenge; figuring out how to efficiently manufacture and assemble the rather simple systems needed to produce and control fission heat so that it can be converted into steam that can spin a turbine to reliably and safely produce a valuable product.

          AAE had the same philosophy, but we wanted to add heat to an inert gas so it could be the working fluid for simple Brayton cycle machinery.

          1. How to converse with this?

            “If Brent can build a 20 MW plant for the $100 million he claims…”

            How do I reply to “internet drone guy can build nuke plant because the internet…”?

            Of course I’m not surprised that Rod is bullish across the board – that is just situation normal.

            1. Michael,

              You have a great deal of practical knowledge about the Nuclear industry.
              Is it physically possible to use off the shelf parts to assemble a working 20MW system? Could a system be built that only needs a staff of about 25 people to manage it?
              How about costing out the parts he has shown in his design? Are the base costs for the type of system he is proposing within a possible $100 million? Is he missing some critical factor in the costs?
              What is the cost of the fuel rods?
              What is the cost of the control rods?
              What is the cost of the pressure vessel?
              What is the cost of supporting piping?
              What is the cost of an air-cooling system similar to his photos?

              My total amateur, back of the envelope calculations show him profiting about 5 million per reactor per year even paying back investors a 10% return on their capital investment. Now, my estimates have a staffing level of 40 persons per reactor, I estimate 10% of his gross for annual maintenance. He will totally replace his core every 6 years, I estimate a core cost of about $2 million. In all of this I am guessing. You know much more than I do. What is wrong with my guesses?

              Large reactors are theoretically more cost effective. It was not long ago that the average cost of electricity from our Nuclear fleet was just over 2 cents a KWH. Today? Is the cost lower? If the improvements in safety were actual improvements the cost should be lower.

              You have specifically criticized NuScale. I both understand and agree with most of your points. Yep, its expensive electricity. But way more affordable than “renewables” plus natural gas and all the involved system costs.

          2. “Last Energy is focusing on the right challenge; figuring out how to efficiently manufacture and assemble the rather simple systems needed to produce and control fission heat so that it can be converted into steam that can spin a turbine to reliably and safely produce a valuable product.

            The problem is that all of these will build a SINGLE POWER plant i.e. a plant that depends on 1 form of energy. It is a huge mistake.

            Instead, terrapower’s natrium ALMOST has it right. They are going into old power plants that have grid hookups, cooling, generators, etc. Then they want to add reactors. It is off by just a slight amount.
            A utility needs to have that power plant up nearly 100% of the time for it to be considered decent.
            When these new nuclear SMRs are built, they WILL not even be close to 90% uptime since it will take time to stabilize. In addition, the utility may lose $ as they will have built the back-end FIRST and then wait for the front-end to get started.

            Instead, Natrium, and others should build out the back-end, but add a NAT GAS BOILER that provides the energy until the reactor is up and going, but also for when the reactor is shut down. It is cheap to add that, esp. when you have a thermal exchanger. For example, Natrium plans to dump their heat into a large thermal storage tank. They will likely have a thermal exchange with a piping system running through it. If they do 2 different thermal exchangers into the tank, one can be provided from the nat gas, and the other from the reactor.
            This would also allow the back-end to be FULLY tested before the reactor is added and comes on-line. Some of you will say that it is overkill, but simply look up the history of Colorado’s only reactor, Ft. St. Vrain Nuclear power plant. Not only thorium powered, but also He cooled. It was ahead of its time. Sadly, the sensors on the back-end would detect water in the He and the reactor would be shut down.
            Had GA actually used someone else’s sensor, Ft. St. Vrain would STILL be going strong.

            1. @windborne

              Interesting suggestion. Though not often talked about, reactor power plants often have such external heat sources available during construction and testing activities. But they are not sized or designed to be able to produce full power for extended periods of time. It’s worth considering if they should be. Availability of high capacity gas pipelines in areas where coal plants dominate might be a significant consideration.

              Responding directly to your comment about Ft. St. Vrain, I’m pretty sure you have been misled. There really was water in the He primary cooling loop. It came from a malfunctioning water-cooled bearing in the main circulator. Getting the water out of the system was very difficult because the designers never expected it to be there so they did not make any provisions for low point drainage. Gaining access to the necessary points in the system was difficult.

              There were some other FOAK issues, like core movement that was solved by adding some support structures, that limited the plant’s operating time. The team was making good, if slow, progress addressing the issues, but the 10 follow-on orders for new, larger plants were cancelled for a variety of reasons. Without new orders, the investments made in fixing the demonstration unit had insufficient return so the vendor and the owners made the decision to shut down the reactor and convert the power plant to a natural gas power plant, reusing the existing steam system.

            2. This sensor story is new to me. I was under the impression the main issue with Ft St Vrain was the steam driven pumps that leaked steam into the helium circuit. Probably should have used electric driven pumps, or magnetic couplings so no leakage. Really unfortunate that HTGRs were discontinued. They are more efficient and can be made inherently safe against TMI/Fukushima type of accidents in ways thst is hard to achieve with LWRs.

    2. One more thing about the cost of building NuScale plants. They do not yet have their own factory. They are outsourcing the construction to other manufacturers. I have NO inside information. My suggestion is that they write contracts with manufacturers that give a residual income to the manufacturer from the net profits. This would give the manufacturers an ownership motive when pricing their products. Long term income would be enhanced by lowering the initial cost of supplied items. That profit would be even more enhanced by quickly finding ways to reduce costs of manufacturing. A 5 or 10 year residual income from each delivered item, would give a great incentive to KEEP reducing costs!

      At the same time, using pre-purchased power agreements would give NuScale long term stability. The Amazon lie that they are powering their operations from renewable energy (when they are actually using grid supplied power) could be turned into a long term profit by NuScale supplying actual low carbon, reliable electricity to Amazon distribution centers. The amount of power from a single module matches well the power needs of a distribution center. Sites close to the distribution center nearly eliminate the grid costs that about double the cost of power produced.

  4. There are lots of designs out there for small modular reactors. There has been a lot of rhetoric out there that they are cheaper to construct as they will used “factory techniques” to ensure quality, uniformity of units, the efficiency of trained workers, etc. Al of this has sounded very good. It’s sounded good for maybe a dozen years now.

    Maybe, it’s true. I’d like to see someone try to actually build one. Perhaps if one is actually built, it will be like the barn door is open and the stampede will be upon us. One successful unit could provide the example to release pent up demand for more.

    If small modular reactors were a smaller product that didn’t take enormous capital, we would see people be willing to take the risk on the new product. There could even be several iterations of the product produced before the ultimate market success. This somewhat normal process does not occur with nuclear reactors. Perceived high financial risk and unsure benefit prevents these first time investors from enabling the reality of small modular reactors.

    Who put forth the capital to work off the rough edges of today’s existing light water reactors? I do believe this occurred due to government funding. Since existing reactors produce a bit less than 20 percent of the United State’s greenhouse gas free electricity, it seems like the post World War 2 taxpayers made a good investment. It seems like it would take a very small part of the United States budget to build several small modular reactors. Taxpayers would be told there is some risk, but also told the potential benefit could be a large source of emission free energy. It has some similarity to developing a new weapons system for the military. At any rate, it’s just a thought.

    Thanks for the article – Rod.

  5. Difficult to invest in something that doesn’t actually exist and have a long operational history. And almost any new technology is going to be expensive. It took several decades of government subsidies to finally make solar panels economically competitive.

    The TVA should have simply financed the building of the first NuScale facility just to demonstrate to other utilities within the US and around the world that it works.

  6. Please allow me to provide a different perspective.

    The FOAK argument doesn’t pass a sniff test. We built FOAK LWRs in the 60s, even correcting for inflation, for well under 20% the price of UAMPS. With containments and ECCS and everything. This at a time when LWRs were new. Today, NuScale is not new. It is a small PWR, in a steel vessel in a pool of water. It is WWII technology. ECCS is simplified to being just a few valves. It should be cheap even at FOAK. It isn’t. Why not address this elephant in the room? What is NuScale going to do to get back control of costs? It appears the answer is nothing. A secondary question is: What is NuScale going to do to to de-risk its business model of having to peddle for subscribers? It appears the answer is also nothing.

    1. Cyril:

      First of a kind doesn’t just apply to new technology. For example: NuScale’s steel vessel might be similar to other steel vessels, but it needs specific tooling, jigs, processes, etc. that are different from those used to produce other steel vessels. Its steam generators use tubes that are unique, requiring the development of a new supply capability.

      Any new design, even of a product as well developed as internal combustion engines or dishwashers must travel through a development and production curve that means that the first units are substantially more expensive than following units.

      As far as its business model, NuScale’s development plans are far more than just the Carbon Free Power Project. They have development projects in several different locations and targeting several different types of customers.

      They might not succeed. But the failure of CFPP doesn’t equate to a failure of NuScale any more than the failure of an electric van sale to Target would mean that Rivian is doomed to fail. It’s one customer – albeit a significant one – for a product with the potential to find dozens to hundreds of different customers.

      1. Rod, that’s dodging the question. At the risk of repeating myself: FOAK PWRs were built in the 60s that were cheaper than coal plants. The FOAK argument doesn’t pass even a cursory sniff test. FOAK PWRs were competitive. After 7 decades of claimed innovation, they are no longer. The nuclear industry in general and nuscale in this particular instance of debate, have lost control of costs. To get better you first have to admit to being sick. $10000/kW is not acceptable. NuScale needs to start by admitting this and explain their plan to try to get back control of costs. I see no reason to believe the other projects will succeed if they don’t address the root causes of their problems. I want no more excuses that lamely blame things on interest rates, materials costs or FOAK. These are not the real issue.

        1. Cyril:

          I disagree. Nuclear has always been a very capital intensive enterprise. Increases in material costs, labor costs and interest rates have a major effect on the cost trend even without considering the specific challenges associated with a lack of practice and dedicated, skilled opposition.

          The plants that were “cheaper than coal” were planned and built in the 1960s, an era of modest inflation and low interest rates. The stagflation and extreme interest rates that plagued the 1970s and early 1980s played a role in elevating nuclear plant costs into the stratosphere. That effect was magnified by delays like the 2 year licensing hiatus after NEPA & Calvert Cliffs and a similar hiatus after TMI. Plants under construction, with money already borrowed and labor forces already assembled were hit hard by interest rates and labor rates.

          And, BTW, each of the plants ended up being partly affected by FOAK-like inexperience as regulations changed and major new systems had to be retrofitted into a design that was in various stages of completeness – including being fully constructed.

          NuScale’s projected cost increases don’t have much to do with letting costs get out of control. They are mostly a result of mathematical calculations on spreadsheets that result when external conditions change the input values for various prices and carrying costs.

          Once again, compare the cost increases to a contemporary, similarly capital intensive technology like offshore wind. And don’t forget to compare the full cost, not just the rate of cost increases.

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