As the technological downturn continues, investment in nuclear fusion remains strong – in 2021 over €2.7 billion was injected in this area alone. The British Space Agency recently pledged £2.9million to help Rolls-Royce develop a nuclear reactor that could work on the moon and power future settlements there.
Back on Earth, nuclear technology plays a significant role in achieving global carbon neutrality and limiting global warming to 1.5°C. In its 2022 report, the International Atomic Energy Agency (IAEA) emphasized its importance in improving several sectors, including energy supply, which is responsible for more than a third of the world’s energy-related emissions.
The report states: “With one of the lowest carbon footprints among low-carbon technologies, 24/7 availability and the ability to operate flexibly, nuclear power can make an important contribution to the stability and security of a fully decarbonized energy system, and a good complement to renewable sources.”
In December, the US Department of Energy and its National Nuclear Security Administration made a major scientific breakthrough when nuclear fusion was announced. This milestone opens the door to further advances in national defense and the future of clean energy.
UK projects are also hard at work on the latter – scientists at the Spherical Tokamak for Energy Production (STEP) project are developing a prototype plant which they hope will create an unlimited supply of clean energy by 2040. The country recently held a competition for small ones launched modular nuclear reactors to power its energy transition.
To this day, the energy crisis continues – partly due to the Russian war in Ukraine. Governments are now trying to invest in new and innovative ways to bring electricity to homes and businesses in their countries.
A new way of thinking
The innovative approach to creating technology and the “new mindset” that stands for startup culture make it perfect to revolutionize the age-old nuclear technology industry. But what exactly can startups offer when it comes to nuclear energy?
“The nuclear sector has evolved significantly in recent years, with the next generation of startups changing the way the industry works,” says Elisabeth Rizzotti, COO of London-based nuclear technology company Newcleo. The startup is working to create safe, clean and sustainable nuclear energy by developing Generation IV reactors – a technology internationally recognized as the next step in nuclear power plant development.
Elisabeth Rizzotti, COO of Newcleo. Credit: Newcleo
“Similar to space exploration, the industry is moving away from being limited to research and what it receives from government funds, towards an entrepreneurial spirit and increased dynamism that is attracting significant amounts of private investment.”
So what are some of the key terms surrounding nuclear power? Here are four for better understanding:
- Nuclear fusion is a process in which two light atomic nuclei combine to form a single heavier one, releasing enormous amounts of energy.
- Fourth generation nuclear fusion – an area often tackled by startups – involves a system of reactors and nuclear fuel cycle facilities, such as fuel fabrication plants and reprocessing plants. This system could overcome the weaknesses often associated with nuclear power, such as poor fuel efficiency, accidents and high costs.
- In nuclear fission, a neutron hits a larger atom and forces it to split into two smaller atoms. As each atom splits, a tremendous amount of energy is released. This reaction is used in all nuclear power plants.
- Small Modular Reactors (SMRs) are advanced nuclear reactors that have a power capacity of about one-third the generating capacity of conventional nuclear reactors.
Successful in the industry
Among the European startups thriving in this industry is Danish company Seaborg Technologies, which aims to make nuclear power generation affordable and sustainable. It has created compact molten-salt reactors that it hopes will become one of the world’s most sustainable energy sources. Last summer, Seaborg was selected as the recipient of an EU innovation grant, with 74 startups sharing €382 million in grants and/or equity investments. The amount for each startup depended on their needs, with a cap of 17.5 million euros.
Another startup to keep an eye on is Swedish company LeadCold, which is developing a small nuclear reactor cooled by liquid lead. The startup wants to have its first reactor ready for commercial use by 2030.
“Considering the unique characteristics of the industry, we look for startups that can build on solid foundations and have assets to be competitive,” says Maria Cristina Odasso, Head of Business Analysis at LIFTT, an Italy-based VC that over Has raised €58 million and invested heavily in nuclear startups. The portfolio in this notoriously expensive sector includes Seaborg Technologies, LeadCold, Copenhagen Atomics, Moltex Energy and Newcleo, with the latter completing a €300m capital raise last year and planning to raise a further £900m.
“This includes a strong scientific base, the expertise and heritage of the team and management, intellectual property and technological know-how, and a network of key stakeholders.”
Odasso notes that there is currently an interesting trend of new projects and startups around the world that includes the so-called “new nuclear energy”.
“There are several startups and industrial projects working on 4th generation nuclear fusion and the SMR concept,” adds Odasso.
regulations and knowledge sharing
Despite the potential that nuclear industry startups offer, operating in this highly regulated space is a major challenge. Safety and security are top priorities in the sector, with international regulatory requirements adding an additional layer of complexity.
As of March 2023, the IAEA has 176 member states, all of which must adhere to its comprehensive regulatory framework that ensures the safety of nuclear installations throughout their lifetime. Its safety standards and code of conduct on safety of research reactors set the international requirements and recommendations for the development of regulatory regimes, which inevitably create significant but significant hurdles for start-ups.
“It’s a challenge,” Odasso admits. “Resources and competencies for the regulatory process must be planned and secured from the start. Otherwise the company will never leave the research world to start a concrete industrial project.”
Newcleo’s Rizzotti believes that governments and policymakers have a key role to play, particularly in relation to initiatives and policies that encourage investment and growth in the sector, but also education.
“Beyond regulations, this extends to schooling and STEM education as we seek to build the next generation of nuclear talent,” she says.
Rizzotti stresses that Newcleo has a strong knowledge transfer stance, making sure its more experienced team members work alongside those new to the industry to ensure their expertise is combined with the latest approaches and practices.
Although it will take time, she believes this is the best way to ensure a positive future for the nuclear industry – adding that the hurdles facing the next generation in the nuclear industry are not just those of a single player but will be remedied by a collaborative approach across the industry.
A new offer
Startups thrive in the challenging nuclear industry, developing innovative technologies that are proving to be disruptive.
“The compactness of SMRs is a far cry from the large plants of the past, offering shorter and easier build times and much more achievable delivery schedules,” says Rizzotti.
“For Newcleo, our key development is to close the fuel cycle through the use of Mixed Oxide (MOX) fuels that leverage existing nuclear waste. This will reduce the environmental and financial costs of disposing of such waste, reduce the risk of proliferation and avoid the need to search for new nuclear fuel.”
As innovation for nuclear startups increases around the world, so does the demand for expertise in the field. The global skills shortage in technology has been widely discussed, and the nuclear sector is no different. While innovators and founders may have the ideas, a lack of experts could stunt growth.
“It’s likely that our biggest challenges are yet to come and will likely be overcoming the regulatory hurdles for a type of technology that has never been built before, despite being based on existing and proven technologies,” adds Rizzotti. “But we feel well positioned to overcome them with the scientific talent, skills, business environment and financial endowment that we have.”
The nuclear startup ecosystem is set to evolve in 2023, with France-based nuclear fusion startup Renaissance Fusion announcing a €15 million seed round already this year, in addition to numerous similar announcements outside of Europe.
Odasso predicts that in 2023 new start-ups will emerge in both merger and demerger market segments and a tremendous amount of private and public funding will be provided.
Considering the latter, she expects a significant improvement in the next 18-24 months for some existing players consolidating their projects as major industrial players in the field of SMR.
For Newcleo, in 2023 the startup will continue to expand its global team and hopefully secure the acquisition of sites in both the UK and France which will allow it to fully prepare to deploy its technology and produce the quantities of MOX fuel required .
“The next decade will be fundamental to the future of energy security, independence and the planet we live on. Clean, inexhaustible energy must become readily available,” concludes Rizzotti. “We are determined to do our part.”
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