NRC OKs Construction Permit for Kairos Research Reactor

• NRC OKs Construction Permit for Kairos Research Reactor
• South Africa Plans 2500 MWe Nuclear Reactor Procurement
• Urenco to Expand Netherlands Enrichment Plant
• Microsoft Plans Use of Artificial Intelligence in Nuclear Plant Projects
• Illinois Governor Signs Legislation  to Allow SMRs

NRC OKs Construction Permit for Kairos Research Reactor

The U.S. Nuclear Regulatory Commission (NRC) has voted to issue a construction permit to Kairos Power for the Hermes demonstration reactor to be built at the Heritage Center Industrial Park in Oak Ridge, Tennessee. The Hermes reactor will demonstrate the company’s ability to deliver clean, safe, and affordable nuclear heat. As an R&D project it will not generate electricity for customers nor will the heat from the reactor be used for commercial applications.

The Commission’s vote to issue the Hermes construction permit follows the NRC staff’s review of the application. The company said in its press statement that the NRC review was possible due to Kairos Power’s extensive pre-application engagement with the NRC, which began in 2018 and established open lines of communication between the two organizations.

During the NRC’s mandatory hearing in October 2023, NRC Commissioner Wright commended the engagement between Kairos Power, the NRC staff, and the local Oak Ridge community throughout the application review process.

A separate application for an operating license and subsequent NRC approval will be required before Kairos Power can operate the Hermes demonstration reactor in accordance with the two-step, 10 CFR Part 50 licensing process.

In parallel, the NRC is currently reviewing Kairos Power’s construction permit application for Hermes 2, a proposed two-unit demonstration plant that would build on the learnings from Hermes, demonstrating the complete architecture of Kairos Power’s future commercial plants, at a reduced scale, and to prove it can supply electricity to the grid.

The Hermes 2 is designed to produce process heat (35 MWt) for industrial and commercial applications. The fuel utilizes a carbon matrix coated fuel particle, similar to that developed for high temperature gas-cooled reactors, in a pebble-based fuel element. The heat is converted to steam (rankine cycle) which is then can be used to generate electricity or for process heart industrial applications.

The Hermes series will help mitigate technology, licensing, supply chain, and construction risk to achieve cost certainty for Kairos Power’s fluoride salt-cooled, high-temperature reactor (KP-FHR) technology. Lessons learned will be integrated into the company’s future commercial deployments targeted in the early 2030s.

Kairos Power is the recipient of a Department of Energy Advanced Reactor Demonstration Program (ARDP) award for risk reduction funding (Total award value over seven years: $629 million; DOE share is $303 million) to support the development, construction, and commissioning of Hermes in collaboration with its partners: Oak Ridge National Laboratory, Idaho National Laboratory, Materion Corporation, and the Electric Power Research Institute. Kairos Power has also established a cooperative development agreement with the Tennessee Valley Authority to provide defined engineering, operations, and licensing services for Hermes.

The Kairos Power FHR (KP-FHR) is an advanced reactor technology that leverages TRISO fuel in pebble form combined with a low-pressure fluoride salt coolant. The technology uses an efficient and flexible steam cycle to convert heat from fission into electricity and to complement renewable energy sources.

Hermes is the first non-water-cooled reactor to be approved for construction in the U.S. in 50 years. The last molten salt reactor approved was an experiment at Oak Ridge National Laboratory in the 1960s. While it proved the fundamentals of the technology, the design never advanced to commercial applications.

The company plans to begin construction next year at the Heritage Center Industrial Park, a historical Manhattan Project site formerly known as the East Tennessee Technology Park, bringing $100 million of investment and 55 new jobs to the Oak Ridge area.

Note to readers: See also this interactive diagram of KAIROS reactor’s systems and components.

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South Africa Plans 2500 MWe Nuclear Reactor Procurement

A lonfg awaited government procurement for 2500 MWe of nuclear generating capacity will be issued by the South African (SA) government. The government said it will release of the tender in March 2024. Minister of Electricity Kgosientsho Ramokgopa says the government will begin the process of procuring 2500MW of new nuclear energy to come on stream in 2032 or 2033. The procurement could be worth up $50 to $100M depending on the experience the winning vendor has with controlling costs.

Also, the government is still considering whether to ask vendors for large, full size reactors, e.g., 1000 MWe or bigger, a fleet of small modular reactors, or other configurations.

Ramokgopa said the case for more nuclear power was compelling because South Africa needs additional generation capacity, and the Eskom fleet of coal plants is ageing. He said nuclear energy was the “cheapest and cleanest” energy and would provide the baseload power that renewable energy needs for stability.

Ramokgopa said that while the previous attempt to procure nuclear energy under President Jacob Zuma’s administration had been “mired in controversy” the government had now cleaned up the procurement process for this project with the National Energy Regulator of SA and been given the go-ahead to proceed.

According to World Nuclear News, the ministerial announcement of the planned procurement action was made just days after state-owned Eskom confirmed the appointment of Dan Marokane as its new group chief executive. Marokane will assume the position by March 2024 which is when the tender is expected to be released for response by vendors.

In prior years Eskom, which is the South African state-owned electric utility, has not been able to proceed with a procurement for new nuclear plants due to a lack of financial resources to pay for them.  For decades successive governments have given priority to keeping electricity rates low which has strangled Eskom in terms of making capital improvements. The government’s announcement of a new tender did not address the issue of how the country will pay for the reactors.

In past statements the energy ministry called on vendors to self-finance the project which seems like a complete non-starter for the effort. For instance, recently in Poland potential vendors for full size reactors categorically rejected that country’s call for vendor financing. Eskom’s poor credit rating is guaranteed to draw high interest rates for any loans either from investors or multi-lateral financial bodies.

The only countries that would be open to vendor financing are state-owned enterprises from Russia and China. While Russia has provided favorable terms for Turkey, it only covered 50% of the cost while seeking outside investors.  So far Russia has not landed any significant non-Russian cash.

Several potential Turkish firms have declined to participate in an investment effort for the Akkuyu four reactor project citing unfavorable terms and planned electricity rates from the reactors than is higher than the price of electricity from Turkey’s gas-fired power plants. Coincidentally, much of turkey’s gas comes from Russia.

China’s one potential export deal for a 1000 MW PWR for Argentina has been stalled over that country’s requests for 85% financing and the right to sell fuel to the reactor for its entire life cycle. The country’s export efforts have been thwarted in the UK, Romania, and the Czech Republic as each of these countries cited security concerns about China’s offers.

It isn’t clear if South Africa sees China’s role in its energy mix for the next century, more or less, the same way as European nations. China has made significant inroads in Africa with its Belt & Road program. The two-way investment between China and its partners has also reached US$380 billion. When it comes to Africa, since the launch of BRI, China’s influence in the continent has been steadily growing. At present, 53 out of 54 nations in Africa are part of the BRI.

In recent months Eskom has had to deal with its worst power outages on record. Ratepayers have been left without power for up to 10 hours on some days this year. The loss of power has crippled key industries hindering economic growth for the nation as a whole. The outages are due to the breakdowns of Eskom’s antique coal-fired plants, which generate approximately 85% of the nation’s electricity. Poor maintenance and corrupt business practices have also reportedly contributed to the problems.

The previous effort in SA to procure nuclear reactors was a political and personal disaster for the nation and for now former South African president Jacob Zuma. He was jailed following charges in 2017 that he signed a secret deal with Rosatom for 9600 MW of power – eight 1200 MW VVER – and a requirement to buy fuel for the plants for the next 60 years. Rosatom offer 50% financing for the deal which had a potential price tag of about $40 billion.

Zuma was also accused of placing relatives on the project’s management team and bypassing the Energy and Treasury ministries. The deal was never implemented once its terms were revealed to the rest of the government.

NuScale Interest in SMRs for South Africa

In October 2020 The United States International Development Finance Corp. (DFC) signed a letter of intent to support NuScale Power LLC, a U.S. nuclear energy technology firm, to develop 2,500 megawatts of power in South Africa based on its small modular reactor design.

The DFC, which ended its prohibition on supporting nuclear power in July 2020, signed a letter of intent to support NuScale’s bid for South Africa’s independent power producer (IPP) program, the development bank said in an statement emailed to the Bloomberg wire service on 10/16/2020.

The letter of intent is not a funding commitment. A lot of work lies ahead for NuScale, for South Africa, and the bank has said that it has an upper limit of $1 billion for new nuclear projects. The bank has a separate fund for technology development, but it isn’t clear how much funding is available for a single applicant or whether NuScale would quality for it. The intent of both funds is to spur development in non-OECD countries.

At $4,000/Kw, which at the time was a plausible competitive benchmark that NuScale could hit with factory production of multiple units, the cost of the entire program would be $8-10 billion not including grid upgrades. Eskom’s grid would need considerable work to be able to deliver the elecrtricty from 2500 MW of new generating capacity to customers. Since then global inflation for concrete, steel, and other materials, as well as labor, has escalated construction costs. The company recent ended an effort to supply six SMRs to UAMPS in Idaho citing the uncontrollable costs caused by inflation.

If the same six reactor project were to begin today in SA, the cost of six 77 MWe SMRs (462 MWe) at a hypothetical cost at $6500/KW, would be three times the 2020 benchmark or just over $30 billion.

With South Africa’s history of demands for localization of the supply chain for new nuclear projects, it is likely that NuScale, if it won any of the business, would have to build a factory in that country to assemble the reactors and work with the government to capitalize a supply chain to feed it.

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Urenco to Expand Netherlands Enrichment Plant

• Project motivated by long-term demand forecasts

(NucNet) Urenco, the Anglo-German-Dutch provider of uranium enrichment services, has approved an investment aimed at expanding the production capacity of its existing plant in Almelo, the Netherlands. The company said in a statement that the project involves the addition of multiple new centrifuge cascades at the enrichment facility.

Urenco said the expansion is projected to boost the annual capacity at its Almelo plant by 15%, or about 750 tonnes of SWU (separative work units). The new cascades are expected to become operational by around 2027.

According to Urenco, the expansion is a response to an expected long-term increase in customer demand as more countries and utilities turn to nuclear power for the first time or seek to extend and diversify fuel supplies for existing nuclear reactor fleets.

The expansion of the Almelo enrichment plant marks the third investment under Urenco’s capacity program. In July, the company approved its first expansion project at its US site in New Mexico, providing an additional capacity of 700 tonnes of SWU per year. At its site in Gronau, Germany, Urenco is re-fitting an existing space with more modern centrifuge technology which will improve the capacity of the plant.

Boris Schucht, Urenco’s chief executive, said the latest capacity expansion is “the largest so far” and in response to the “growing momentum” behind nuclear energy.

At the COP28 climate conference in Dubai last week, leaders from the US, Canada, France, Japan and the UK – a group of G7 nations informally known as the Sapporo 5 – announced plans to mobilize $4.2bn (€3.9bn) in government-led investments to develop a secure, reliable global nuclear energy supply chain. The investments will aim to increase Western uranium enrichment and conversion capacity over the next three years and establish a resilient global uranium supply market free from Russian influence.

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Microsoft Plans Use of Artificial Intelligence in Nuclear Plant Projects

• The firm wants to reduce regulatory review time and costs using AI large language models to prepare documents and speed up the NRC’s reviews of license applications.

Facing a need for numerous new data centers that will require 60-120 MWe of power from small modular reactors, Microsoft has kicked off an investment in artificial intelligence (AI) to support applications for preparing the documentation needed for the NRC’s regulatory approval of the projects. The data centers are needed to support the firm’s use of AI which consumes enormous amounts of computing power and electricity.

Without the SMRs, the energy demands of AI systems are expected to be a significant constraint for organizations moving forward, particularly for data centers hosting AI systems that support the biggest applications.

According to reports in the Wall Street Journal (firewall) and computing industry trade publications Microsoft is using large language models (LLMs) to expedite the approval process for nuclear power projects that will fuel its future artificial intelligence (AI) and supercomputing energy requirements.

The WSJ reports that a team at Microsoft has spent the previous six months training an AI model with US nuclear regulations and licensing documents to assist with generating the massive amounts of paperwork for nuclear power projects. The plan is to cut down on the time it takes to create the documents and speed up the lengthy and costly NRC review process. The NRC gets over $300/hr for its review of license applications so every hour of work that can be eliminated is money saved for building the reactors.

The energy demands of AI systems are expected to be a significant constraint for organizations moving forward, particularly for  hosting data centers supporting the operations of the biggest AI models.

The WSJ reported that Microsoft’s senior director Michelle Patron, Senior Director of Sustainability Policy at Microsoft,  said if the company wants to scale its models in a sustainable way it will need to use the technology to support its growth.

Microsoft is teaming up with nonprofit Terra Praxis, which told the WSJ that AI could cut 90 percent of the human hours required to get a new plant approved.  Terra Praxis is involved in redeveloping coal fired power plants with SMRs.

“What we’re doing here is training a [large language model] on very specific highly structured documents to produce another highly structured document almost identical to previous documents,” Terra Praxis co-CEO Eric Ingersoll told the WSJ. “We’re not getting the kind of wacky answers where the AI is hallucinating.”

“If we’re going to do that [grow] carbon-free, we’re going to need all the tools in the tool kit.”

Separately, last September Microsoft issued a notice of intent to hire a senior executive but so far has not announced it has filled the position.

According to a company fact sheet, as of August 2023 the Microsoft network connects more than 60 datacenter regions, 200 datacenters, 190 points of presence, and over 175,000 miles of terrestrial and subsea fiber worldwide, which connects to the rest of the internet at strategic global edge points of presence. In addition to pulling electricity from regional grids, each data center has diesel generator backups in case of power outages.

All these numbers mean that there are robust opportunities for Microsoft to harness SMRs to provide reliable, CO2 emission free electricity to its data centers. Further, as data centers grow, SMRs can grow with them by adding new units over time.

Last October SMR developer NuScale announced it has signed a deal to build 24 SMRs at data centers in Ohio and Pennsylvania – 12 in each state. The plan was criticized by investors who questioned the capacity of NuScale and its partners to deliver the project.

It isn’t clear whether Microsoft was expected to be one of the customers of the data centers. In Ohio Amazon has a $7.8 billion master plan to build more than two dozen data centers in Central Ohio and some of them will support Intel’s $20 billion semiconductor plant being build just north of Columbus.

Microsoft is also buying electricity from an existing nuclear power plant. The WSJ reports Constellation CEO Joseph Dominguez calls the matchup between data centers and nuclear power ‘peanut butter and jelly.” Last June the utility agreed to sell nuclear power to Microsoft for a data center in Virginia when wind and solar aren’t available.

So far, according to the WSJ, Google has not announced any plans to to use SMRs to power its data centers although a company spokesperson said the firm is thinking about it.

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Illinois Governor Signs Legislation  to Allow SMRs

(NucNet) Illinois governor J.B. Pritzker has signed legislation lifting a three-decade moratorium on development of nuclear reactors in the state. Small modular reactors – usually defined as those producing less than 300 MW of power – will be allowed from the beginning January 2026.

Sue Rezin, a Republic senator representing the 38th district in north-central Illinois and the proposal’s sponsor, successfully argued that nuclear power is a critical part of the state’s renewable energy portfolio.

“Illinois has a long, successful and safe history of nuclear energy generation,” Rezin said in a statement after the Democratic governor’s action, which she said “will ensure that our state can remain a leader in the energy sector by offering us the ability to utilize the amazing advancements in new nuclear energy technology.”

A similar bill was vetoed by Pritzker in August, with the governor later explaining that while he supported the goal behind the legislation, the language used was “too vague” and would be used to construct conventional large-scale nuclear plants instead of being focused on SMRs. Anti-nuclear groups weighed in on the proposal which reportedly influenced the Democratic governor’s decision to sign off on a veto message.

The new version of the bill includes other provisions to satisfy the governor, including assigning oversight of any new SMRs to the Illinois Emergency Management Agency in addition to the required federal controls. Among other things, it limits the power rating of new reactors to 300 MWe SMRs. In 2021, Pritzker signed a law requiring Illinois to use only carbon-free electricity by 2045. The new legislation allowing the deployment of SMRs is part of the state’s strategy to meet those goals while accommodating expected increases in overall demand.

“With the proliferation of EVs and other energy-consuming manufacturing processes we’re just going to be short on energy and we need to find a way to be able to procure it, but also make it carbon free,” said Illinois Representative Lance Yednock, the bill’s main House sponsor.

Illinois has 11 reactors – more than any other state – at six nuclear power stations: Braidwood, Byron, Clinton, Dresden, LaSalle and Quad Cities.

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