![]() ![]() Despite $2 billion in federal subsidies, TerraPower’s costs have ballooned to more than $4 billion amid years of delays. Deep-pocketed competitors include TerraPower, a joint venture between Bill Gates and Warren Buffett’s Berkshire Hathaway, which is seeking to build a novel molten chloride, liquid sodium-cooled 345-megawatt reactor in Wyoming. Last Energy is hardly the only startup aiming to build a new generation of smaller reactors. Jon Markman is president of Markman Capital Insight and editor of Fast Forward Investing. Cameco could trade to $34.50 within 12 months, a gain of 28% from the current price of $27. This interest will ultimately increase demand for uranium. Momentum is building in the West to expand the life of existing nuclear plants, and numerous companies and countries are pursuing the development of small modular reactors and advanced reactors, according to the International Atomic Energy Agency. Nuclear power is impossible without uranium U-235, the fissionable material used in all current nuclear facilities. The best way to play this trend is Cameco, the Saskatchewan-based uranium producer that holds some of the world’s largest deposits. Illustration by Patrick Welsh for Forbes HOW TO PLAY ITīy Jon Markman Basic micro-reactors are the future of nuclear power generation. Kugelmass’ solution is to adopt the financing model from wind and solar projects: Last Energy will build and own the plants, using long-term contracts as the basis for borrowing the large amounts of money needed-around $1 billion in the case of the Polish project. After all, their monopolistic rates are set by regulators. In the U.S., utilities that dare try to build new nuclear plants bear little risk from outrageous cost overruns, since they know they can always cover bills by charging more for their electricity. He studied the obstacles to building more nuclear capacity and concluded that too much complexity, along with excessive regulation, were major problems.Īnother issue: the historically runaway costs of large nuclear projects, which he attributes in part to skewed incentives in the way they have been financed and built. ![]() ![]() Kugelmass was still a nuclear novice in 2018, so he began interviewing experts via a podcast, Titans of Nuclear, that has now grown to nearly 400 episodes. Each 20-megawatt unit requires less than an acre. GREEN DREAMS | Last Energy power plants will blend into the environment, with reactor cores underground and fans and steam turbines replacing hulking cooling towers. Generating the same 20 megawatts as one of Kugelmass’ proposed mini-reactors would take, on average, 600 acres of solar panels or 4,000 acres of wind turbines. Moreover, land access and NIMBYism make it hard to scale up-wind and solar farms worldwide already cover an area twice the size of Texas and deliver just 5% of the planet’s electricity needs. Wind? Solar? They require more than ten times as much material per unit of electricity generation as nuclear, notes Marc Bianchi, an energy analyst at Cowen & Co. According to Columbia University’s International Research Institute for Climate and Society, nuclear is the only fix for the “ energy trilemma”-a source that is reliable, affordable and sustainable. Kugelmass quickly homed in on nuclear power as a big part of the solution. At that point, he decided to devote himself to fighting climate change. ![]() He raised $5.8 million for his venture, known as Airphrame, and sold it in 2017. In 2012, when he was just 25, he launched a business that used a fleet of fixed-wing drones to assess storm risk by conducting photographic surveys of millions of rooftops for insurance companies. You can still hear in Kugelmass’ voice the Long Island kid who loved building robots and who studied math at SUNY at Stony Brook before earning a master’s in mechanical engineering at Stanford. It’s smart money, though: $21 million came in a round led by Austin, Texas-based Gigafund, whose managing partner, Luke Nosek, was the first VC investor to back Elon Musk’s SpaceX. Kugelmass aims to build 10,000 of these mini-reactors worldwide, which sounds fantastical for a nuclear industry newbie who has so far raised just $24 million in venture capital. At an operational plant this cube, containing the reactor, will sit underground. “We black boxed the entire operation,” says Kugelmass. ![]()
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