The AI Investment Boom

I think the renewables would have been built at the same rate anyway precisely because they're so cheap; but nuclear power, being expensive, would not be built if this bubble had not happened, and somehow nuclear does seem to be getting some of this money.

After Fukushima (https://news.ycombinator.com/item?id=41768726), Japanese reactors were shut down and there was a glut of uranium available in the spot market. Simultaneously, Kazatomprom flooded the market with cheap ISR uranium. The price of uranium fell far below the cost of production and the mining companies were obliterated. The few miners that survived via their long-term contracts (primarily Cameco) put their less efficient mines into care and maintenance.

Now we're seeing the uranium mining business wake up. But after a decade of bear-market conditions the miners cannot serve the demand: they've underinvested, they've lost skilled labor, they've shrunk. The rebound in uranium supply will be slow, much slower than the rebound in demand. This is because uranium mining is an extremely difficult process. Look at how long NexGen Energy's Rook 1 Arrow mine has taken to develop, and that's prime ore (https://s28.q4cdn.com/891672792/files/doc_downloads/2022/03/...). Look at Kazatomprom's slowing growth rate (https://world-nuclear-news.org/Articles/Kazatomprom-lowers-2...), look at the incredible complexity of Cameco's mining operations: https://www.petersenproducts.com/articles/an-inflatable-tunn...

Here is a discussion of the uranium mining situtation: https://news.ycombinator.com/item?id=41661768 (including a very risky method of profiting from the undersupply of uranium, stock ticker SRUUF, not recommended). Note that Numerco's uranium spot price was put behind a paywall last week. You can still get the intra-day spot uranium price for free here: https://www.yellowcakeplc.com/

https://news.ycombinator.com/item?id=41860341

Basically, nuclear fission is clean baseload power. Wind and solar are not baseload power sources. They don't really compete. See discussion here: https://news.ycombinator.com/item?id=41858892

Furthermore, we're seeing interest (from Google and Amazon and Dow Chemical) in expensive but completely safe TRISO (HALEU) reactors (https://www.energy.gov/ne/articles/triso-particles-most-robu...). These companies want clean baseload power, with no risk of meltdown, and they're willing to pay for it. Here's what Amazon has chosen: https://x-energy.com/fuel/triso-x

TRISO (HALEU) reactors use more than 1.5 times the natural uranium per unit of energy produced because the higher burnup is offset by higher enrichment inputs (see page 11 at https://fuelcycleoptions.inl.gov/SiteAssets/SitePages/Home/1...), and the fuel is even more expensive to manufacture, but they are completely safe. This is a technology from the 1960's but it's attractive now because so much money is chasing clean baseload nuclear fission for data centers.

These "impossible to melt down" TRISO small modular nuclear fission reactors are what Elon Musk was talking about on the campaign trail last week, when he said:

  ELON MUSK: "The dangers of nuclear power are greatly
  overstated. You can make a nuclear reactor that is
  literally impossible to melt down even if you tried to
  melt it down. You could try to bomb the place, and it
  still wouldn't melt down. There should be no regulatory
  issues with that. There should be significant nuclear 
  reform."

The US has zero commercial reactors under construction and this is for one reason: economics.

The recent announcements from the hyperscalers are PPAs. If the company building the reactor can provide power at the agreed price they will take it off their hands. Thus creating a more stable financial environment to get funding.

They are not investing anything on their own. For a recent example NuScale another SMR developer essentially collapsed when their Utah deal fell through when nice renders and PowerPoints met real world costs and deadlines. [2]

[1]: https://www.lazard.com/media/gjyffoqd/lazards-lcoeplus-june-...

[2]: https://iceberg-research.com/2023/10/19/nuscale-power-smr-a-...

This means you don't understand how the grid works. California's baseload is ~15 GW while it peaks at 50 GW.

New built nuclear power is wholly unsuitable for load following duty due to the economics. It is an insane prospect when running at 100% 24/7, and even worse when it has to adapt.

Both nuclear power and renewables need storage, flexibility or other measures to match their inflexibility to the grid.

See the recent study where it was found that nuclear power needs to come down 85% in cost to be competitive with renewables, due to both options requiring dispatchable power to meet the grid load.

> The study finds that investments in flexibility in the electricity supply are needed in both systems due to the constant production pattern of nuclear and the variability of renewable energy sources. However, the scenario with high nuclear implementation is 1.2 billion EUR more expensive annually compared to a scenario only based on renewables, with all systems completely balancing supply and demand across all energy sectors in every hour. For nuclear power to be cost competitive with renewables an investment cost of 1.55 MEUR/MW must be achieved, which is substantially below any cost projection for nuclear power.

https://www.sciencedirect.com/science/article/pii/S030626192...

> These companies want clean baseload power, with no risk of meltdown, and they're willing to pay for it. Here's what Amazon has chosen

The recent announcements from the hyperscalers are PPAs. If the company building the reactor can provide power at the agreed price they will take it off their hands. Thus creating a more stable financial environment to get funding.

They are not investing anything on their own. For a recent example NuScale another SMR developer essentially collapsed when their Utah deal fell through when nice renders and PowerPoints met real world costs and deadlines.

https://iceberg-research.com/2023/10/19/nuscale-power-smr-a-...

> with no risk of meltdown

Then we should be able to remove the enormous subsidy the Price Anderson act adds to the industry right? Let all new reactors buy insurance for a Fukushima level accident in the open market.

Nuclear powerplants are currently insured for ~0.05% of the cost of a Fukushima style accident and pooled together the entire US industry covers less than 5%.

https://en.wikipedia.org/wiki/Price%E2%80%93Anderson_Nuclear...

I'm on PG&E, I wish I could get my electricity for only $0.14/kWh

From what I’ve understood PG&E’s largest problem is the massive payouts and infrastructure upgrades needed from the wildfires, not the cost of the electricity itself.

Even the peak of that graph (136… er, USD per lb?) is essentially a rounding error compared to everything else.

0.00191 USD/kWh? Something like that, depends on the type of reactor it goes in.

The fuel is a tiny fraction of the cost of running the plant. See discussion here, contrasting with natural gas: https://news.ycombinator.com/item?id=41858892

It is also important that the fuel is physically small so you can (and typically, do) store years of fuel on-site at the reactor. Nuclear is "secure" in the sense that it can provide "energy security".

And I'm saying that as someone who finds all this stuff cool and would like to see it used in international shipping.

I already linked this above, twice. I know it's a hassle to read, it's Sunday afternoon, so don't worry about it.

It's not important whether you as an individual get this right or not, as long as society reaches the correct conclusion. Thankfully, we're seeing that happen, a worldwide shift toward the adoption of nuclear power.

Have a pleasant evening!

For Europe overall is 22%.

For modern nuclear power the only nuclear reactor under construction in France is Flamanville 3 which is 6x over budget and 12 years late on a 6 year construction timeline.

Hinkley Point C in the UK is in a similar quagmire and Olkiluoto 3 finally got finished last year after a near 20 year construction timeline.

Politically there's some noise from conservative politicians who can't hold a climate change denial position anymore, but still need to be contrarians.

The problem is the horrendous economics.

Eh, it's generally SMRs, which remain kinda vapourware-y. I'd be a little surprised if anything concrete comes of it, tbh; I suspect that it is mostly PR cover for reactivating coal plants and the like. (The one possibly-real thing might be the Three Mile Island restart, but that in itself isn't particularly consequential.)