History has always involved progressing up the energy density ladder and MSR technology fits this bill
Six considerations
1. Public perception
2. Safety
3. Cost
4. Efficiency
5. Waste
6. High heat processes
1. Public perception
Nuclear needs a rebrand & PR makeover
When people hear nuclear the likes of the Chernobyl series or nuclear weapons spring to mind.
MSRs achieve this and address both safety concerns and waste concerns (the two most common nuclear reservations).
2. Safety
MSRs are "walk-away safe"
An operator couldn't melt it down even if they wanted to
MSRs aren't vulnerable to a terrorist attack as they work at atmospheric pressure, so a breach would cause the fuel to solidify without a significant release of radioactivity
3. Cost
By design, they are relatively simple (no containment domes and far fewer moving parts)
This could make them accessible to developing countries
Their small size lends them to factory-based mass production
The fact they can run on nuclear waste is cost saving in itself
4. Efficiency
"Conventional reactors typically use only 3-to-5% of the available energy in their fuel rods before the fuel rods must be replaced due to cracking"
MSR doesn't have this issue and can use up most of the rest of the available fuel in these rods to make electricity
5. Waste
Because of this efficiency waste remains radioactive for a relatively short time ~300 years or less (compared to 10,000years for conventional nuclear waste).
This is obviously a huge sell that MSR consume nuclear waste and produce very little themselves.
6. High heat processes
The most interesting to me being hydrogen.
MSRs could produce hydrogen using both thermal and electrical energy making the process very efficient
Using 78% thermal energy & 22% electrical its estimated hydrogen could be produced for less than $2kg
This moves humanity up the energy density ladder
Wood < coal < oil <nat gas < hydrogen < nuclear
MSRs being as/more economic than coal would cause mass adoption in developing countries which is key with 6.5B people set to increase to ~8.5B by 2050 doubling the energy system.
As what we have currently is developed countries 1.3B people pursuing inefficient and uneconomic renewables with predictable results
While developing countries 6.5B people are focused on keeping up with energy demand and increasing their standard of living, not ESG or emissions
The narrative is that thermal coal is in terminal decline & will be replaced by renewables and nat gas moving forward
Coals in decline in developed countries, but we often overlook the fact that developed countries are the minority globally
Coal still accounts for almost 40% of global electricity production
It pays to remember is that developed countries comprise of 1.3B people while developing is 6.5B people which based on demographics is on the way to 8-8.5B people by 2050.
This doubles the energy system.
Where does coal demand stand currently?
There is 1,790,642 MW operating globally (1m MW is in China)
There is 199,572 MW under construction or +11%
There is 297,829 MW planned or +17%
So in total, this means adding nearly 1/3 to the current global coal plants
“Show me the incentives and I will show you the outcome.” - Charlie Munger
Ensuring incentives are aligned positions you for better outcomes.
At the minimum know what everyone's incentives are before entering any deal/investment.
2. Asymmetry
Position for ideally large (unknown) upside and small (known) downside
"If you ‘have optionality,’ you don’t have much need for what is commonly called intelligence, knowledge, insight, skills and these complicated things that take place in our brain cells"-N Taleb