The Fund Portfolio

Q1 2022 Investment: Deep Isolation

Deep Isolation Wins $3.6 Million DOE Grant to Develop Universal Nuclear Waste Disposal Canister for Advanced Reactor Spent Fuel

[The following is reprinted from Deep Isolation’s site.]

Deep Isolation, in partnership with the University of California, Berkeley, Lawrence Berkeley National Laboratory and NAC International, has been awarded a $3.6 million grant by the U.S. Department of Energy’s Advanced Research Projects Agency-Energy (ARPA-E) to develop a universal nuclear waste disposal canister for advanced reactor waste streams.

The project, one of two awarded today to Deep Isolation by the ARPA-E Optimizing Nuclear Waste and Advanced Reactor Disposal Systems program, will support the development of low-carbon advanced reactor power plants by establishing a universal canister design and waste form acceptance.
                
                            

Deep Isolation Joins Oklo Inc., National Laboratories in Winning $4 Million DOE Grant for Spent Fuel Waste Reduction Project

 

Deep Isolation, Oklo Inc., and the Argonne and Idaho national laboratories have been jointly awarded $4 million by the U.S. Department of Energy’s Advanced Research Projects Agency-Energy (ARPA-E) to develop the first nuclear fuel recycling and disposal facility in the United States.

The project, one of two awarded to Deep Isolation today by the ARPA-E Optimizing Nuclear Waste and Advanced Reactor Disposal Systems (ONWARDS) program, will commercialize a fuel recycling facility that will include, for the non-recyclable waste, the development of a final waste solution compatible with a deep borehole repository. It’s the first focused program working to identify pathways to reduce waste material and minimize the need for disposal sites, and it’s the first federally funded program to explore pairing a commercial borehole solution with a recycling facility for an advanced reactor.

Deep Isolation will be analyzing the waste streams that would be generated by the electrorefining facility to identify waste forms suitable for a deep borehole repository. It will also establish the technical and cost savings framework for using deep borehole repositories as a complement to electrorefining.

For more information about DEEP ISOLATION, please see their website at deepisolation.com.

Nucleation Capital has closed on an equity investment in DEEP ISOLATION

[The following is a draft of a pre-announcement to LPs.]

We are pleased to report that we have secured an investment in Deep Isolation’s Series B bridge round.
 
Deep Isolation is addressing one of the long-standing issues to the use of nuclear power: “What do you do with the waste?” They are the first and only private company commercializing a cost-effective solution to such waste. Their proprietary approach leverages standard directional drilling practices, supplemented with their own robust intellectual property, to safely and affordably isolate waste deep underground in specially-designed canisters, carefully emplaced in stable, geologic borehole repositories.
 
Deep Isolation’s solves the problem of an expensive, temporary and deeply unsatisfactory above-ground treatment for waste by offering a competing solution that is inexpensive, deep underground (as temporary or permanent storage) and highly satisfactory. Their solution could potentially reduce the projected global cost of permanent waste storage, estimated at well over $600 billion, down to a fraction of that, while vastly improving both public satisfaction and long-term safety. 
 
Deep Isolation has an exceptionally impressive team and serves as an enabling venture that, in solving the waste issue in a proven and safe way, could help reduce obstacles for the expansion of nuclear around the world. 
 
Nucleation Capital is the first venture fund to invest in Deep Isolation, which has successfully raised seed and Series A capital previously from strategic partners and a few well positioned private investors. We are also working with DI to bring on additional investors and LPs prior to the close. Accordingly, we have agreed to syndicate an allocation in the round, thereby helping to introduce them to a broader array of climate investors, both large and small.
 
Both the fund’s investment and the syndicate deal will close together (likely by the end of this month), so this deal will not be visible on your investor dashboard page for Q1 yet.

For more information about DEEP ISOLATION, please see their website at deepisolation.com.

Q4 2021 Investment: Radiant Nuclear

Nucleation Capital has closed on an equity investment in RADIANT NUCLEAR

[The following was approved by Radiant for private release to our LPs.]

We are pleased to report that Nucleation Capital completed a Series A investment in Radiant Nuclear with Q4 funds. Union Square Ventures served as the lead investor and the deal included Energy Impact Partners, Cantos VC, Decisive Point, among others. Radiant received more investor interest than they needed for their round, which is unusual for a nuclear venture. Despite being oversubscribed, we believe Radiant accepted funds from Nucleation Capital because of the clear added benefit of having a fund with a clear nuclear focus, nuclear expertise and a robust nuclear network involved.
 
Radiant Nuclear is an advanced nuclear venture that defies much of the convention around nuclear. The company’s founders are not nuclear engineers. Rather they are experienced hardware, software and systems engineers who spent about a decade at SpaceX. The team was instrumental in developing, building, testing and deploying specialized hardware and software systems. Most impressive of their many achievements there was the design and construction of the terrestrial landing gear, control sensors and software systems for controlled reverse landing of the SpaceX Falcon 9 rockets back onto a landing pad after launching. 
 
Following that spectacular achievement, the team lead was tasked with solving a remote refueling problem for a rocket that might be landed on Mars with payload capacity to bring refueling supplies. After evaluating the challenge using pretty much every angle and possible option, it became abundantly apparent that the only solution was a small, mobile nuclear reactor. After studying the range of options, the concept for a remote mobile system that could be autonously operated emerged. When SpaceX declined to pursue the project, the founder left SpaceX to do a broadbased assessment. He eventually launched Radiant to pursue the market, recruited his team and brought on nuclear engineers to join them.
 
There is merit to supporting this approach as there are a multiplicity of challenges to designing, testing and deploying advanced nuclear systems and the precise nuclear core may not be the most complex portion. Some reactor developers are fond of saying that nuclear energy is not “rocket science.” There is well-understood physics, chemistry and mechanics involved but new designs require very careful modeling and testing and economic deployment is key challenge. As with space exploration, there is little room for error and much at stake. Thus, investing in a founding team that has been around the block developing mission-critical, high-pressure, high-expense projects that require utter precision and true design decisiveness was irresistible. 

[Note: We are very pleased to have been able to participate in this funding round. The fact that Radiant made room for us in this round, despite the presence of an abundance of other VCs with far more capital, emphasized just how unique Nucleation Capital is and the advantages we can provide a venture in really understanding the technology and have deep connections within the industry.]

For more information about RADIANT NUCLEAR, please see their website at www.radiantnuclear.com.

RADIANT ANNOUNCES ITS FINANCING

On March 9, Fred Wilson of USV posted news of the investment by USV’s Climate fund in Radiant Nuclear, which round included Nucleation Capital.

Fred writes: 

USV’s Climate Thesis is to invest in companies and projects that provide mitigation for or adaptation to the climate crisis. One important way that we can both mitigate and adapt to the climate crisis is to use more nuclear energy. I wrote about this on my AVC blog last year and have been committed to finding one or more nuclear startups to invest in and work with since then.

I am excited to be able to say that I have found the first one and that company is Radiant.

Radiant designs and builds portable, low-cost one-megawatt nuclear fission microreactors that fit in a shipping container, power about 1,000 homes and use TRISO fuels and a helium coolant instead of water. This is what a Radiant microreactor will look like:

That system, which fits inside a shipping container, will power a remote community, commercial facility, military base, etc for upwards of five years before needing to be refueled. And that power will be sustained, clean, and cost-effective.

Radiant’s portable microreactor, Kaleidos, is being developed at a fast pace, using modern software engineering. To learn how, check out this video: Radiant’s Kaleidos.

I have always been interested in networks of small-scale systems versus large centralized solutions. I grew up in the information technology business and have lived through the transition from mainframes, on which I did my first programming as a teenager, to minicomputers, to PCs, to PC networks, to the Internet. I believe that a massive network of small systems is more cost-effective, more reliable, more accessible, and better in every way than large centralized systems and my instinct is that this will be true in energy as well.

When we met Doug Bernauer and his co-founders, we found a team that has the right background, mindset, and commitment to pull something like this off. USV’s Climate Fund recently led a $10mm round that will take Radiant through a number of important milestones and get them closer to putting a system like this in the field.

Radiant is a small team of world-class engineers from a collection of key disciplines and they are looking to add a few more of them. They are particularly interested in the best engineers in the areas of Nuclear Core Design, Materials, Multiphysics Modeling, and Licensing. If you are one of those people, please go here and let them know you would like to join the Radiant team.

It will be a few more years before a system like the one shown above will go live somewhere, but when it does, it will be a new era in the age of nuclear energy and I can’t wait for that to happen.

Radiant Extends Investment Round to include DCVC — March 28, 2022

Radiant notified its investors to get approval on the  extention the series A slightly to bring in Data Collective Venture Capital (DCVC). Adding DCVC brings in another great investment firm that strengthens Radiant’s investment backing considerably and paves the way for future growth.  

The opportunity in this case is just too good to pass up, largely because DCVC has recently hired Rachel Slaybaugh into DCVC, who previously served as a director of ARPA-e and UC Berkeley Nuclear Engineering professor. Dr. Slaybaugh will provide a wealth of technical knowhow, connections and guidance. 

Q3 2021 Investment: Core Power

Nucleation Capital has closed on an equity investment in CORE POWER

[The following is text approved by CORE Power for public release. Release was approved a few weeks later.]

CORE POWER is a UK-based development company, specializing in advanced scalable nuclear power technology for ocean transport and heavy industry. In partnership with leading international corporations, CORE POWER aims to deliver durable zero-emission energy for floating industrial production and deep-sea shipping.

CORE POWER is a member of the TerraPower, Southern Co., Orano consortium that applied for a United States Government’s Department of Energy (DoE) Risk Reduction grant and was successfully awarded $140 million by the DOE for work on a Molten Chloride Fast Reactor (MCFR).

TerraPower is a privately held advanced nuclear venture founded by Bill Gates; Southern Company and Orano are highly experienced nuclear technology development and supply partners for the MCFR.

CORE POWER’s area of expertise is to develop the market for a maritime MCFR in applications ranging from clean production zero-carbon fuels to nuclear propulsion of large ships.

The consortium is working under a Joint Collaboration Agreement (JCA) where CORE POWER holds exclusive rights to maritime applications.

CORE POWER is targeting advanced nuclear propulsion for the largest 7,500 ships, responsible for 50% of global CO2 emissions from shipping, as well as designing production systems for the manufacture and production of green hydrogen based zero-carbon fuels on offshore production platforms.

Further applications of a maritime MCFR includes barge-mounted mobile power plants, rapid response water desalination tankers, deep-sea mining vessels, rapid plastics recycling, and reformation as well as floating production and industrial processing of minerals and soft commodities.

CORE POWER has deep ties within the ocean transportation industry with many of the company’s shareholders representing familiar names in that market. The current shareholder base either owns or operates more than 2,000 large ships which are in line to install the technology, once ready and licensed for maritime use.

The Company recently completed a second round of funding (Series B-1). Aside from Nucleation Capital, there were no other VC firms in this deal. Instead, most of the $15.4 million raised came from owners and managers of some of the largest shipping companies in the world.

CORE POWER’s Founder, Chairman and CEO has 30 years of experience working in the shipping industry, at a senior level, in technology, finance, transport and commodities.  These relationships are a major strategic asset and CORE POWER anticipates earning interim revenue from these prospective customers by working to help them prepare their fleets for conversion to the MCFR.

CORE POWER’s equity is leveraged 4-to-1 by the private capital provided by their consortium partners, TerraPower, Southern and Orano. This total capital is further leveraged 4-to-1 by the $140 million non-dilutive 80/20 cost-share grant from the U.S. DOE, which we believe aids the consortium’s and CORE POWER’s prospects for success considerably.

[Note: We are very pleased to have been able to participate in this funding round. The absence of other VCs only emphasizes just how unique Nucleation Capital is and how potentially instrumental we can be in bridging the funding gap in this sector.]

For more information about CORE POWER, please see their website at www.corepower.energy

TerraPower Consortium Signs Risk Reduction Agreement with the DOE
On November 18, Southern Company and Idaho National Laboratory announced the signing of a $170 million cost share agreement entered into with the U.S. Department of Energy to build the proof of concept Molten Chloride Reactor Experiment. These tandem announcements make reference to the fact that applications in ocean transportation and other marine uses are the purview of CORE POWER. Southern Co.’s Press Release The Idaho National Lab Press release Learn more about CORE POWER here. Follow CORE POWER on Twitter. Follow CORE POWER on LinkedIn.
Update from CORE POWER

CORE completed our B-1 funding round last month. This Series B-1 covers CORE’s share of the ‘Molten Chloride Reactor Experiment’ development currently underway at Idaho National Laboratory (INL) with our consortium partners TerraPower, Southern Co. and Orano.

MCRE will be the world’s first fast-spectrum salt-fuelled nuclear fission reactor, and is a vital precursor to the eventual commercialisation of the Molten Chloride Fast Reactor (MCFR) that can be deployed in such a game-changing fashion for future maritime and floating energy applications.

To support that program and to engage with U.S. regulators and stakeholders CORE opened a U.S office in Washington, D.C. in early November. They will build a presence in Washington to grow this part of the business throughout 2022 and beyond.

As the COP 26 spotlight fell on Scotland, both shipping and advanced nuclear energy were central on the agenda at the recent COP26 in Glasgow.

U.S. Special Presidential Envoy John Kerry, at the unveiling of the net-zero by 2050 declaration of several countries (led by the U.S., Denmark, and Marshall Islands), pointed out that the U.S. Navy has an impeccable track record of nuclear propulsion over 67 years—never lost a crew member, never had a spill. . .

COP26 also saw the birth of the ‘Clydebank Declaration’, a formation of ‘green’ corridors to assist infrastructure development for synthetic fuels, and also a First Movers Coalition to accelerate technology advancements in hard-to-abate-sectors such as shipping. The MSR can play a central role in all these initiatives to produce cheap, green zero-carbon fuels on floating refineries at key junction points under this agreement.

Talk of nuclear being ‘excluded’ from the talks proved to be far from the case. French economy and finance minister Bruno Le Maire summarised it well when he said that ‘Nuclear energy is not a question of ideology, but a question of maths‘.

As countries continue to grasp that the need for carbon-free, dispatchable baseload power is going to be fundamental in meeting climate goals, several nations announced land-based SMR (small modular reactor) projects, often replacing coal-fired power on their grids in projects that could be seen as ‘low hanging fruit’ in the climate transition.

The decision by TerraPower to site their new Natrium reactor (which also features a molten salt energy storage system) at a retiring coal plant in Kemmerer in Wyoming by 2027, was further evidence of this.

Investors in Japan are paying attention too. A CORE POWER press briefing on the MSR in early October, led to an exciting panel discussion of the MSR at Bari-Ship 2021 and profiled as a viable solution for decarbonization of large ships.

Update from CORE POWER: UK adopts ‘Nuclear Code’ for merchant ships

The UK’s Department for Transport (DfT) has confirmed that they will transpose SOLAS Chapter VIII into UK Law in the autumn of 2022. This is a milestone in the regulatory pathway for ships powered by advanced nuclear.

This Annex of SOLAS includes the ‘Nuclear Code’ (Resolution A.491.Xii) for merchant ships which was adopted at the IMO in 1981. The Maritime and Coastguard Agency, on behalf of the DfT, undertook a consultation on the proposed legislation during the second half of 2021.

The UKMCA has now published their summary of responses received and simultaneously confirmed their “intention to progress making the Regulations as planned…[and]…does not intend to significantly amend the prepared draft legislation“.

The ‘Nuclear Code’ is now over 40 years old, and needs overhaul and updating, but what is important is that the government has acknowledged that an overwhelming majority “agreed that there is an appetite for nuclear ships over the next 10 years with growing interest for nuclear propulsion for large ocean-going vessels.”

Implementing the SOLAS Chapter VIII requirements and building strong ties with others, including the US, will increase the likelihood of UK flagged nuclear powered ships and reinforce the broader maritime safety regime.”

To learn more, see Core Power’s Merchant Shipping (Nuclear Ships) Regs to become UK law in 2022.