Pictured holding a shovel with other executives in June, Gates said: “I believe Terrapower’s next-generation nuclear energy will power the future of our nation – and the world.”
The company is just one of several start-ups that are shaking up the nuclear industry after decades of relative stagnation.
The push by “big tech” into AI is creating massive and growing demand for power, triggering a round of frantic deal-making as companies battle for uninterrupted supplies. Nuclear has emerged as a favoured option.
Last month, Microsoft signed an agreement with a utility provider to restart the Three Mile Island nuclear plant, in Pennsylvania, in a deal worth $16bn (£12.4bn).
That was swiftly followed by announcements this month that Google had ordered up to seven mini-nuclear reactors from Kairos Power, another start-up, and that Amazon was supporting rival X-Energy to build another four in Washington state.
Around the world, a plethora of upstart companies are hoping to ride the wave with their own small reactor designs, including NuScale, Holtec, Last Energy and Ultra Safe Nuclear. They are competing against larger industry incumbents such as GE Hitachi, Westinghouse and Britain’s Rolls-Royce.
Some businesses want to deploy old technology, such as water and gas-cooled reactors, in new ways. Others are looking at designs not widely used yet, such as molten salt or liquid metal-cooled reactors.
It has kindled hopes that private enterprise could shake up the previously state-dominated nuclear industry, in an echo of how Elon Musk has revolutionised rocket travel.
Gates is one of several big hitters to have entered the fray, with investment guru Warren Buffett joining him as an investor in Terrapower.
Meanwhile, X-Energy’s backers include Kam Ghaffarian, the billionaire behind space start-ups Axiom Space and Intuitive Machines, and Ken Griffin, the boss of US hedge fund Citadel.
Peter Thiel, the Donald Trump-supporting billionaire who founded PayPal, has also backed a nuclear fuel start-up through his Founders Fund vehicle.
“Big tech is forcing an industry that is used to moving at a glacial pace to move at warp speed,” says Ben Finegold, a nuclear analyst at London-based investment house Ocean Wall.
“There’s going to be a conflict where someone’s going to have to have to budge, and I think it’s going to be the nuclear industry – because the technology companies are going to throw tens of billions of dollars at this.”
Power-guzzling data centres
Silicon Valley’s newfound interest in nuclear energy is based on sheer pragmatism. AI requires far more computing power than other activities such as internet search. Technology giants have concluded nuclear is their best bet for large, dependable supplies of electricity.
At the same time, many are being told there is no longer enough grid capacity to accommodate their giant, power-guzzling data centres – meaning they have to look elsewhere or find their own source of generation.
Nuclear plants have proven difficult to build in the West for a variety of reasons, not least because of their complexity and the thickets of planning regulations companies must battle.
Against that backdrop, Mark Nelson, the managing director of consultancy Radiant Energy Group and a nuclear engineering graduate from Cambridge University, suggests that tech companies may at first prioritise switching on old plants that can be brought out of retirement, or complete construction of those that were only part-built or planned but never delivered.
However, in the longer run, they are likely to turn to newer innovations being pioneered by startups promising “smaller and safer” nuclear plants.
These should be simpler and less expensive than big power stations thanks to “modular” construction, meaning their constituent pieces can be mass produced in factories and transported to sites by truck.
This newer generation of reactors need less space and so can sit next to other buildings, rather than being remotely located as large nuclear plants are for safety reasons.
“The beauty of these smaller reactors is that they are simpler, they’re easier to construct and they’re more finance-able, which is why we’re seeing the private investor market coming in to support delivery now,” says Carol Tansley, the vice president for projects and head of UK at X-Energy, which wants to build reactors in Teesside.
Carol Tansley, of UK at X-Energy
Carol Tansley, of UK at X-Energy, wants to demonstrate the economic viability of smaller reactors
“That said, none of these things are up and running right now, so the role we have to play is to demonstrate they can be delivered on time and on budget, and that they are economically viable,” she says.
The new generation of reactors are generally divided into so-called small modular reactors (SMRs) and next-generation, advanced modular reactors (AMRs).
SMRs – including all those being considered in the Government’s design competition – are based on existing water-cooled reactor technology, only miniaturised.
These have long been used in nuclear-powered submarines and are now being commercialised by major companies including Rolls-Royce.
Other “micro” versions of these reactors have also been developed, such as the 20 megawatt plants that Last Energy wants to build at a former coal power station in Bridgend, South Wales.
“We’re using proven technology that is absolutely understood and already utilised around the world,” says Michael Jenner, the boss of Last Energy UK.
‘The holy grail of nuclear’
AMRs will use different designs – and novel types of fuel. Many will also feature “passive safety” designs that, it is claimed, make it impossible for them to suffer meltdowns.
“We’ve designed reactors that are 100pc safe,” Mr Ghaffarian, who founded X-Energy in 2009, told Forbes in an interview last year.
“If there’s a tsunami, an earthquake ... or a plane crashes into it, they can never go super-critical. And because of that, you can have them in the middle of cities, or anywhere.”
X-Energy’s reactor will be helium-cooled and use so-called Triso fuel particles.
Short for tri-structural isotropic, these “pebbles” look like metallic-coloured billiard balls but have been described as “the most robust nuclear fuel on Earth” by the US Department of Energy.
They are made from poppy-seed sized pieces of uranium, encased in layers of tough carbon-based and ceramic materials that keep radioactive material trapped inside.
This makes them tough enough to handle temperatures of up to 1600C, according to a 2015 Cambridge University paper. (The upper melting point of stainless steel is just over 1,500C.)
Mr Ghaffarian describes the company’s Triso-based design as “the holy grail in nuclear”.
Using these pebbles, X-Energy’s reactors will each generate about 80MW (megawatts) of power – or 320MW in “four packs” – and produce steam at a temperature of 565C.
In Texas, they are set to be used by Dow Chemical at the company’s Seadrift complex, where a variety of plastics are made, along with glycols for bottles and oxide derivatives used in beauty products.
It is one example of how mini-nuclear plants could help to decarbonise parts of the economy that might otherwise be extremely difficult or expensive to serve with renewables or hydrogen.
Triso is also the foundational technology that underpins Gates’s Terrapower and Google’s partner Kairos Power, with the former opting to use liquid sodium as a coolant and the latter using molten salt.
For now, the race is on to bring the first working reactor to market. More than 70 projects have been awarded some kind of seed funding by the US government.
Terrapower’s Wyoming plant is among them, with Gates and his investors having agreed to match $2bn (£1.6) provided to them by taxpayers.
The plant is envisaged as the first of many, with efficiencies of scale then set to bring the price of generation to parity with natural gas. In Europe, this is currently around €40 (£33.35) per megawatt hour.
“I think they will reshape the industry,” says Mr Nelson of the new crop of start-ups. “The tech companies are so profoundly rich and their futures are so constrained by this problem that they’re going to have room for multiple bets.”
