Fourteen of the world's largest banks and financial institutions, including Bank of America, Citi, Parabas, Morgan Stanley, Goldman Sachs and Abu Dhabi Commercial Bank, are pledging to increase their financial support and backing for nuclear energy. This announcement was made at an event held in New York City during Climate Week, in a long-awaited recognition by these financial institutions that the nuclear sector has a critical role to play in the transition to low-carbon energy and provided direct support of COP28's pledged goal of a global tripling of nuclear power.
The announcement occurred at a gathering in the Rockefeller Center, which brought together heads of state, ministers, and top executives from the nuclear and finance sectors. John Podesta, White House climate policy adviser, introduced the sesion by saying, “Our mission is clear: to ensure nuclear energy plays its role in building a sustainable, secure future. If we work together, we can make nuclear a cornerstone of our climate strategy.”
The banks did not commit to any specific funding but their pledge is an acknowledgement that the availability of funding is critical in the transition to low-carbon energy. In particular, high financing costs have been an obstacle to the construction of new plants and lack of availability of funding interest contributed to the decline in new projects for most of the last four decades. with the majority of the world's reactors built in the 1970s and 1980s.
We believe that this new bank pledge is a reflection of the demand inflection point that nuclear is experiencing, with increasing customer interest demonstrating the value that nuclear has for both reliable energy and carbon-free energy. Banks are increasingly aware that, rather than being controversial, nuclear power is becoming increasingly popular, especially for those fully committed to decarbonization.
Bank of America has already begun to recommend nuclear investments for its clientel, having previously issued its "Nuclear Necessity" report. It will naturally follow, then, that BofA and other banks that have done their homework, will be willing to provide direct lending, project finance and investment banking support to utilities and other nuclear companies looking to deploy new nuclear generation.
This announcement should help to shift attitudes at other international and multilateral agencies, such as the World Bank and IMF, which still do not provide any finance to nuclear projects. What is becoming increasingly clear is that there is virtually no scenario in which the world can achieve carbon neutrality by 2050 without nuclear power, according to the UN’s Intergovernmental Panel on Climate Change. These banks have heard that message and are ready to deal.
Bill Gates wrote about this ground-breaking in Kemmerer, Wyoming on his GatesNotes blog and he provided further background on his interest in advanced nuclear, which started as far back as 2008. It just so happened that when he fell in love with the density, inherent safety and superior performance of advanced nuclear power, he was able to afford to hire a team and launch TerraPower on his own. It also didn't hurt that he happened to be buddies with Warren Buffet, the CEO of Berkshire Hathaway, the company that owns PacifiCorp, which owns a lot of struggling coal plants, so he was able to score a site on the property of a retiring coal plant, on which to plan to build his demonstration reactor.
In fact, advanced nuclear holds tremendous prospects for resurrecting the value of these ill-fated plants and the economic vitality of those regions suffering from the closures of coal, most of which are closing as a result of competition form cheap natural gas that is also better suited for being "dispatched," at a minute's notice, if, let's say, the wind stops blowing. As many as 80% of these plants could, according to a study done by the DOE, be converted to advanced nuclear plants cost-effectively, because they are reuse turbines, generators and even transmission lines that are already there. Taking what are currently brownfield sites with very little value because of the toxicity, health and carbon-impacts of coal and converting them to clean power plants that use advanced fission to generate both power and heat, is starting to look like a very lucrative endeavor.
No wonder Bill Gates has already invested over a billion dollars and has committed to putting billions more of his own funds into this venture. Being the sixth wealthiest person in the world gives him this option. And, if you think that, because you read a lot and you've had exeptional success with a software company, that you have what it takes to create the best advanced nuclear technology and believe that it will be rapidly adopted and deployed around the world and possibly put the remainder of the world's coal plants out of business, investing your billions into that makes total sense.
For the rest of us, however, investing into a venture fund like Nucleation Capital, which is dedicated to building a diversified pool of advanced nuclear ventures with various alternative designs, more than a few of which could find real traction within differing niches of the energy markets which also need power but may prefer a different configuration or set of features, may make more sense and pose considerably less risk. Especially when the fund provides low-cost participation, so that those of us not in the top ten wealthiest humans list, can access that fund without breaking the bank but nevertheless have a meaningful chance of participating in the growth of nuclear around the world.
According to numerous analyses, the Biden Administration is taking decisive steps to support the construction of large-scale nuclear reactors, crucial for meeting our clean energy goals, as well as supporting the licensing and development of next-generation nuclear power plants. The White House has formed an expert group whose focus and mission will be to work on solving the problems that are cause delays to new projects and thus eliminate, reduce or mitigate industry risks to ensure timely completion of projects and bolster progress towards a carbon-free power sector by 2035 and a net-zero emissions economy by 2050. The text of the White House Fact Sheet is so perfect, it is better to reprint it than attempt to summarize it. See the first few paragraphs below, but click the links to go directly to the sources.
For decades, nuclear power has been the largest source of clean energy in the United States, accounting for 19% of total energy produced last year. The industry directly employs nearly 60,000 workers in good paying jobs, maintains these jobs for decades, and supports hundreds of thousands of other workers. In the midst of transformational changes taking place throughout the U.S. energy system, the Biden-Harris Administration is continuing to build on President Biden’s unprecedented goal of a carbon free electricity sector by 2035 while also ensuring that consumers across the country have access to affordable, reliable electric power, and creating good-paying clean energy jobs. Alongside renewable power sources like wind and solar, a new generation of nuclear reactors is now capturing the attention of a wide range of stakeholders for nuclear energy’s ability to produce clean, reliable energy and meet the needs of a fast-growing economy, driven by President Biden’s Investing in America agenda and manufacturing boom. The Administration recognizes that decarbonizing our power system, which accounts for a quarter of all the nation’s greenhouse gas emissions, represents a pivotal challenge requiring all the expertise and ingenuity our nation can deliver.
The Biden-Harris Administration is today hosting a White House Summit on Domestic Nuclear Deployment, highlighting the collective progress being made from across the public and private sectors. Under President Biden’s leadership, the Administration has taken a number of actions to strengthen our nation’s energy and economic security by reducing – and putting us on the path to eliminating – our reliance on Russian uranium for civil nuclear power and building a new supply chain for nuclear fuel, including: signing on to last year’s multi-country declaration at COP28 to triple nuclear energy capacity globally by 2050; developing new reactor designs; extending the service lives of existing nuclear reactors; and growing the momentum behind new deployments. Recognizing the importance of both the existing U.S. nuclear fleet and continued build out of large nuclear power plants, the U.S. is also taking steps to mitigate project risks associated with large nuclear builds and position U.S. industry to support an aggressive deployment target.
To help drive reactor deployment while ensuring ratepayers and project stakeholders are better protected, theAdministration is announcing today the creation of a Nuclear Power Project Management and Delivery working group that will draw on leading experts from across the nuclear and megaproject construction industry to help identify opportunities to proactively mitigate sources of cost and schedule overrun risk. Working group members will be made up of federal government entities, including the White House Office of Domestic Climate Policy, the White House Office of Clean Energy Innovation & Implementation, the White House Office of Science and Technology Policy, and the Department of Energy. The working group will engage a range of stakeholders, including project developers, engineering, procurement and construction firms, utilities, investors, labor organizations, academics, and NGOs, which will each offer individual views on how to help further the Administration’s goal of delivering an efficient and cost-effective deployment of clean, reliable nuclear energy and ensuring that learnings translate to cost savings for future construction and deployment.
The United States Army is also announcing that it will soon release a Request for Information to inform a deployment program for advanced reactors to power multiple Army sites in the United States. Small modular nuclear reactors and microreactors can provide defense installations resilient energy for several years amid the threat of physical or cyberattacks, extreme weather, pandemic biothreats, and other emerging challenges that can all disrupt commercial energy networks. Alongside the current defense programs through the Department of the Air Force microreactor pathfinder at Eielson AFB and the Office of the Secretary of Defense (OSD) Strategic Capabilities Office (SCO) Project Pele prototype transportable microreactor protype, the Army is taking a key role in exploring the deployment of advanced reactors that help meet their energy needs. These efforts will help inform the regulatory and supply chain pathways that will pave the path for additional deployments of advanced nuclear technology to provide clean, reliable energy for federal installations and other critical infrastructure.
Technology companies compete with each other in a lot of ways but they all want to achieve the goal of being able to run operations and data centers using 24/7 carbon-free energy. They've done about as much as they can trying to buy, build and/or get credits from wind and solar plants and it hasn't been sufficient. With its announcement, Google acknowledges that they "need a broader portfolio of advanced clean electricity technologies" to be able to fully decarbonize their energy consumption.
The announcement lists the following as "advanced clean electricity technologies": next-generation geothermal, advanced nuclear, clean hydrogen and long-duration energy storage. This is an astounding announcement because it makes it clear that the tech companies are now moving their focus away from wind and solar, which are just too inconsistent and unreliable, to better, more reliable options.
The initiative aims to aggregate their demand for better types of clean energy to increase their buying power, their lobby power (we have to believe) and diversify the risks of investing in first-of-a-kind (FOAK) plants, whose costs are always higher than "Nth" of a kind plants. They recognize that there are a bevy of developers looking to build next-generation nuclear (and probably also geothermal) plants and they want to be able to help these ventures build those FOAK units, without each individually and solely having to take on risk. This is a tremendously important initiative and concept, it will definitely help accelerate the timelines for companies seeking to get plants built.
THe announcement comes just a few weeks after Amazon announced their purchase of Talen's nuclear-power Cumulous Data Center, which will enable Amazon Web Services to achieve their very ambitious decarbonization goal by 2025. But there aren't many nuclear power plants with spare generating capacity. In order to get access to sufficient quantities of 24/7 clean nuclear power, the U.S. will need to start building next-generation plants, many of which will be Gen IV designs.
Brad Plumer, writing in the New York Times, provides the details of this very small demonstration plant built in Tracy, California. It's an open air structure, with 40-foot racks holding hundreds of trays, each sprinkled with calcium oxide powder that turns into limestone when it binds with airborne carbon dioxide. This is a natural process that Heirloom is working to speed up.
Once the carbon dioxide is "captured" through the creation of the limestone, the company expects to heat up the limestone in a kiln at 1,650 degrees Fahrenheit, which then releases the carbon dioxide, where it then gets pumpted in a storage tank, leaving the calcium oxide to be returned and reused on another set of trays.
The carbon dioxide (called CO2) is expected to be transferred again to be permanently stored. For now, Heirloom is looking at the large concrete marketplace and working with CarbonCure, a company that was launched to mix CO2 into concrete to make concrete stronger by having it turn into limestone again where it will be permanently stored and reduce the carbon footprint of concrete (which ordinarily releases a lot of carbon emissions through its normal creation and use throughout the building industry).
Providing CO2 to CarbonCure has a value for sure but for now, that value is far below the costs of capturing the carbon. Let's look at what these economics are now. The Tracy facility will be able to absorb 1,000 tons of CO2 per year. At the estimated $50/tonne "social cost" of carbon, the Heirloom facility would earn $50,000 per year. Although Heirloom hasn't released info on its specific costs, those funding breakthrough carbon capture activity, such as Frontier (which includes Stripe, Alphabet, Shopify, Meta and McKinsey Sustainability), are typically paying between $500 and $2,500 per ton to accelerate innovation and market development. These high prices are intended to generate sufficient revenue for these early-stage ventures to actually cover their costs. At $1000/ton, Heirloom could earn $1,000,000 per year. However, Plumer estimates that Heirloom's actually costs may be in the range of $600 per ton or higher.
Fortunately for Heirloom and other ventures working in this space, there are a lot of large corporations willing to spend millions to pay for "carbon removal credits" in what has been a voluntary carbon market to effectively be able to claim that they are reducing their carbon footprints. These corporations see reputational benefits from those outlays, even if they do not result in even meaningful actual carbon reductions at this stage. The Biden Administration is also getting into the act and awarded $1.2 billion to help Heirloom
The Heirloom carbon capture plant in Tracy, California
Many people still don't know much about carbon capture and storage, or what has been called "Carbon Capture, Utilization and Sequestration" (CCUS). There are a multitude of approaches being taken to capture carbon and, as a result, a plethora of acronyms have emerged. The approach used by Heirloom is now called Direct Air Capture (DAC) and specifically involve capturing CO2 out of the air but other approaches are simply called Carbon Dioxide Removal (CDR) and utilize a range of methods to bind that CO2 in a semi-permanent or permanent way, such as through marine-based CDR or natural processes such increasing the CO2 content in soils or accelerating the use of CO2 by plants, such as by growing crops or trees with the intention of having them capture the CO2.
Utilization of CO2 involves finding valuable ways to use that CO2 or just the carbon (C) from captured CO2. Ventures working on the utilization part of this process pose the prospects of having profitable business models. Nucleation Capital, as a climate-focused venture fund, recognizes that CCUS is a growth industry that is anticipated to become a large consumer of energy. We are following the activity in this nascent space and we are investing in some of the most promising approaches, especially where that approach has strong profit and growth prospects or where it intersects with the need for abundant clean energy. While knowing all the acronyms isn't critical, there are a few key things to know about CCUS in general.
Key Facts to Know about CO2 and Carbon Capture, Utilization & Sequestration
While CO2 itself is natural and not toxic (except in high doses), the enormous amount that we have polluted our atmosphere with by burning fossil fuels for energy is causing our climate to warm up at a very fast rate. We need CCUS in order to lessen and possibly reverse the rate of warming, so we can restore a healthy climate.
All technological approaches to capturing carbon back out of the air or water are expensive and early stage. So are the approaches to carbon utilization and sequestration (i.e. methods to utilize and/or store the carbon so it doesn't get released back into the atmosphere).
To stop making our climate crisis worse, we have to stop burning fossil fuels, as our highest priority mitigation effort. While some might think that capturing the carbon emitted from burning fossil fuels right at the point source may warrant continuing to burn fossil fuels, that will not enable us to use carbon capture to restore the damage already done, which is the primary rationale for CCUS.
Even if we stopped burning fossil fuels today, the amount of damage the long-lived CO2 pollution is causing the world will continue to heat the planet for decades or centuries. The only way to prevent that is by removing this excess CO2 pollution.
Today, there are only a handful of dedicated carbon capture plants in existence globally but, to prevent serious damage to earth ecosystems, we will need to scale up these plants in record time to be able to reverse most of the emissions produced by the fossil fuel industry in its entire history. We will also need to scale utilization and sequestration capabilities.
The cost of cleaning up all of the emissions caused by our past use of fossil fuels will be enormous and we haven't come to any agreement as to who bears that burden. Some of that cost can be mitigated with valuable commercial utilization technologies.
Powering CCUS plants will require massive amounts of low-carbon clean energy because it makes no sense to emit carbon in the process of capturing carbon. The best and least-cost approach will likely involve using the coming generation of small modular reactors to generate 24x7 power in remote areas.
The cost of clean energy used to capture and sequester carbon will be a significant factor in the total cost of that activity but powering CCUS can help SMRs scale up, which will help reduce the manufacturing costs.
There is no scenario in which the cost of burning fossil fuels and capturing all the CO2 from that activity and permanently storing it will cost less than replacing the fossil fuels with renewables or nuclear and avoiding the release of new emissions in the first place.
Fossil fuel companies are already lobbying to earn carbon credits by pairing carbon capture with the extraction and burning of fossil fuels. This is why some environmentalists, like Al Gore, oppose providing funding for CCUS to oil and gas companies, even though the most cost-effective CO2 capture is done at or close to the fossil fuel smokestack source point.
Learn more about Frontier a consortium that is providing advance market commitments (AMC) that aim to accelerate the development of carbon removal technologies, without picking winning technologies at the start of the innovation cycle. The goal is to send a strong demand signal to researchers, entrepreneurs, and investors that there is a growing market for these technologies.
The 2021 Bipartisan Infrastructure Law included $3.5 billion to fund the construction of four commercial-scale direct air capture plants. In August, the Biden Adminstration announced $1.2 billion in awards for the first two, one to be built by Battelle in Louisiana and the other to be built by Occidental Petroleum, in Texas, through a 50-50 cost share.
This corporate PR news made zero headlines in the press but we could not be more excited about it. Yet, this unassuming group of executives pursuing their own corporate objectives, could well have an enormous impact on the future of the whole planet. The agreement they reached and announced in a joint press release, involving the planned procurement by Microsoft of Clean Energy Credits (CECs) from OPG, may be the first-ever voluntary corporate purchase of a carbon-credit from nuclear energy.
This auspicious moment deserves more attention than it received, as it marks the inclusion of nuclear energy for the first time as a source of carbon credits. Up until now, for no reason other than possibly concerns about public perception, carbon credit purchases (which are an entirely voluntary type of corporate greenwashing) have come solely from purchasing rights to claim credit for new renewable energy generation and activities like reforestation or rainforest preservation. As far as we know, no company has elected to purchase clean energy credits from nuclear energy.
This ground-breaking agreement could well serve as a model for many other companies seeking truly meaningful ways to reduce their actual and ongoing carbon impacts and the team involved in the deal is clearly aware that they are setting a new precedent. The press release included the following three quotes from Ken Hartwick, President and CEO of OPG, Chris Barry, President of Microsoft Canada, and Todd Smith, Canada's Minister or Energy:
“This innovative partnership will not only spur economic development in Ontario, but also serve as a model for other companies and jurisdictions to encourage use of clean hydro and nuclear power,” said Ken Hartwick, OPG President and CEO. “As part of OPG’s Climate Change Plan, we committed to achieving net zero as a company by 2040, and to act as a catalyst for efficient economy-wide decarbonization. Ensuring industry has access to clean energy to offset emissions assists in meeting that goal.”
“We can only address climate change by tackling the challenge collectively. Agreements like this one with OPG will help Microsoft move closer to achieving our sustainability commitments, including our goal of having 100 percent of our electricity consumption, 100 percent of the time, matched by zero carbon energy purchases by 2030.” said Chris Barry, President, Microsoft Canada. “Working closely with like-minded organizations like OPG, will help us move toward a more sustainable future, while continuing to power innovation in Ontario.”
“As environmental goals increasingly influence corporate decisions on where to invest and grow, this partnership between OPG and Microsoft illustrates the potential for Ontario’s Clean Energy Credit registry to draw businesses from across the world to our province,” said Todd Smith, Minister of Energy. “This voluntary registry will incentivize investments in new clean energy generation and technological innovation while reducing costs for ratepayers.”
Microsoft has grabbed the corporate high ground with a commitment to be carbon negative by 2030. The senior executives have studied the issue and write: "If we don’t curb emissions (given that human activity has already released more than 2 trillion metric tons of greenhouse gases), and temperatures continue to climb, science tells us that the results will be catastrophic."
To provide the best experiences, our website uses technologies like cookies to store and/or access device information. Consenting to these technologies will allow us to process data such as browsing behavior. Not consenting or withdrawing consent, may adversely affect certain features and functions.
Functional
Always active
The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
Preferences
The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
Statistics
The technical storage or access that is used exclusively for statistical purposes.The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
Marketing
The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
No wonder Bill Gates has already invested over a billion dollars and has committed to 
