President Barack Obama’s $8.3 billion in loan guarantees for new nuclear power plants announced earlier this morning is aimed squarely at building more of the massive, gigawatt-sized reactors we’re all familiar with. Big nuclear is also the target for $36 billion in loan guarantees that the Obama Adminsitration has proposed for the Department of Energy’s 2011 budget. Still, that same budget request could represent opportunity for the handful of startups venturing into the world of nuclear power, if they can deliver on promises of small-scale, modular reactors, nuclear technologies that fuel themselves, or the long-awaited working model of a fusion power plant.
Take small-scale nuclear plants, which are the target of some $38.8 million in proposed 2011 DOE spending. These are pretty much limited to aircraft carriers and submarines nowadays, but could represent a way for venture capitalists to get in on the nuclear resurgence without spending the billions required for today’s large-scale plants. While experienced nuclear power contractors such as Toshiba and Babcock & Wilcox are working on small scale reactors — as are government labs such as Sandia National Laboratory — so are startups such as NuScale Power and Hyperion Power Generation.
At the same time, companies are researching ways to utilize new fuels for nuclear power, or, in the case of Bill Gates-backed TerraPower, use the fuel normally relegated to waste in today’s fission reactors. And fusion power is being pursued by a handful of startups alongside the government-funded research going on around the world.
Of course, getting into the nuclear power business isn’t like launching a consumer electronics or networking startup. Anyone seeking to commercialize nuclear power technology will face years of testing and certification by government entities such as the U.S. Nuclear Regulatory Commission, and that means investors will have to be patient. Still, for those willing to wait, here are some of the more intriguing (and well-funded) opportunities out there in the new world of nuclear startups.
NuScale Power: This Corvalis, Ore.-based startup landed $2.65 million from CMEA Capital in September 2008, with the goal of deploying technology developed by DOE and Oregon State University. It wants to make modular, 45-megawatt reactors that can be linked together to generate power at about the same cost — 6 to 9 cents per kilowatt-hour — as traditional, larger nuclear plants. Beyond saving money by building in pieces, NuScale’s passive water cooling system is safer than traditional reactors, the company claims. The company has plans to submit its design to the NRC in early 2012, which will begin a multi-year approval process that could see reactors available by late in the decade.
Hyperion Power Generation: This Santa Fe, N.M.-based startup has landed an undisclosed investment from private equity firm Altira Group to commercialize a “fission battery” technology that emerged from Los Alamos National Laboratory. The Hyperion Power Module — a self-contained cylinder about the size of a hot tub — promises 70 megawatts of heat and 25 megawatts of steam-driven electricity for about $25 million apiece, and is meant to be buried next to remote communities, military bases, tar sand extraction operations and other power-hungry, hard-to-reach areas.
While it’s still on the hunt for a Series B round of funding, Hyperion has been valued at $100 million by its investors, and has plans to open factories capable of churning out about 4,000 units in the coming years. Of course, like its brethren, Hyperion will face a years-long process of seeking approval from the NRC, but it already has a purported customer — Romanian investment company TES Group has said it wants to buy six modules when they’re ready.
TerraPower: Think of it as a nuclear reactor that powers itself from its own waste. TerraPower wants to commercialize a “traveling wave nuclear reactor” design that’s been under development since the mid-1990s. The basic idea is to start with enriched uranium — the fuel for today’s nuclear plants — and then utilize the depleted byproduct of the fission process to produce more power. That could lead to a nuclear reactor that doesn’t need to be refueled, or have its waste disposed of.
The startup also has deep Microsoft roots — it’s a spin-off of Intellectual Ventures, the think tank founded by former Microsoft CTO Nathan Myhrvold, and Bill Gates is a principal owner. Those deep-pocket backers could be useful, as TerraPower is looking at about 10 years to demonstrate a working plant, and about 15 years to commercial deployment, according to a presentation from TerraPower President John Gilleland.
General Fusion: Fusion power is the holy grail of nuclear power — enormously powerful and waste-free. And, of course, it’s incredibly difficult to accomplish, and is mostly limited to big, government-funded research projects such as Lawrence Livermore National Laboratory’s National Ignition Facility and MIT’s Plasma Science and Fusion Center. Still, there are startups getting funded to pursue fusion, and one of them is Vancouver’s General Fusion, which has raised some $13.5 million from investors, including Canadian firm Chrysalix Partners to work on “magnetized target fusion.”
The idea is to use hundreds of mechanical pistons to drive a shock wave through a lead-lithium mixture surrounding a plasma of hydrogen isotopes deuterium and tritium, fusing them into hydrogen. Nuclear experts say it’s technically feasible, but difficult to accomplish. General Fusion has said hopes to demonstrate a working model in 2013.
Tri-Alpha Energy: This secretive fusion startup reportedly raised $40 million from Venrock Ventures and other investors in 2007 to commercialize technology out of the University of California at Irvine that involves a mixture of hydrogen and boron that “chase” one another in a plasma electric generator, according to a U.C. Irvine report. The company may be set to demonstrate its technology some time this year, according to Greentech Media.
Helion Energy: Another would-be fusion startup is Seattle-based Helion Energy, which said in April that it’s seeking up to $20 million to build a working model of its engine, intended to electromagnetically propel ionized hydrogen to speeds of millions of miles an hour, generating immense amounts of heat. The company is aiming at a full-scale prototype by 2011 or 2012 and a commercial model within a decade, Helion President Philip Wallace said in April.
Image courtesy of Hyperion.
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