Modelling the Metaverse: The Fight to Profit from the Next Big Thing

By Pengana Capital 
November 26, 2021

Key Takeaways

• The hardware required for teleporting into the Metaverse is still clunky and the content scant, but the remaining technological hurdles would seem to have reached the stage where they can be solved with time and money.

• A concert in 2020 attended by 27 million avatars already suggests how some experiences could be just as good, if not better, experienced in the Metaverse.

• Valuing technology companies has always involved trying to get a firm handle on the future rewards that will come to those that succeed in exploiting totally new platforms.

• For Apple, the business model is straightforward: replicate in 3-D the experience of using the iPhone. For Facebook, the model involves using its own hardware as a cudgel for keeping a larger share of the advertising spoils.

CEOs spend a lot of time communicating their visions for their companies to a naturally skeptical public. Traditionally, this involves traveling around the country or world to interact face-to-face in conference rooms or auditoriums, or, over the past two years, logging into an endless series of video calls. But recently the top executive at a Prague-based technology startup tried presenting in another realm altogether.

This presentation came during a virtual conference hosted by JPMorgan titled “Ready Player One,” after the science-fiction novel by Ernest Cline about a society in the near-future when all of humanity uses a virtual simulation to escape the drab reality of their lives. The speaker was Artur Sychov, CEO of Somnium Space, one of the first open-source platforms designed specifically for virtual-reality users. Instead of wearing the usual business suit, Sychov appeared as a black-clad superhero-like avatar. Behind his avatar, you could see the sparse expanse of the Somnium landscape extending in every direction. The sun was just starting to peek over a virtual horizon, and a handful of buildings rose nearby including the dome of a planetarium.


Artur Sychov, CEO of Somnium Space. Source: PodFest Asia

For those logging in from home laptops and office workstations, Sychov provided an opportunity to experience a concept which has been a key talking point for many tech industry CEOs in 2021. That concept—now commonly called the Metaverse—is a totally immersive version of the internet where, instead of just viewing and listening to content, users feel as if they are in it. Initially built atop the existing internet, the Metaverse could eventually become so pervasive and so absorbing that it subsumes the current 2D web (at least that’s the idea), offering compelling facsimiles for almost every activity people can experience in the physical world, with the possible exceptions of eating and sleeping.

Recent evidence of tech companies’ intense focus on the Metaverse abounds. At a Microsoft conference in May, CEO Satya Nadella spoke at length about his company’s new “Azure Digital Twins” that allows its enterprise customers to create live always-on simulations of their products, facilities, processes, and people. Google has gone on a major hiring spree to beef up its engineering staff for augmented reality (AR)1 search. Apple has quietly been buying up early-stage AR and virtual reality (VR) startups in areas from advanced optics to virtual events.

Of the large-cap players, Facebook and its CEO Mark Zuckerberg have publicly been the most all-in on the concept, declaring that in the future people will associate Facebook more with the Metaverse than with social media, and pledging a major increase in capital expenditures to ensure that they do. In October 2021, the company even went so far as to change its name to Meta to reflect the seriousness of that ambition (and to try to move on from the controversies stirred by a whistleblower’s release of internal documents about the potential harmful effects of its current products). A time when the physical and virtual worlds blend into one has never felt more possible.

To a point anyway. Teleporting into the Metaverse currently requires bulky devices that resemble inches-thick blindfolds—not something many people would be comfortable wearing while working, even from home. The hardware problem was demonstrated by Sychov’s presentation: no one else on the call was wearing a VR headset. When he said that it was “hard to explain the degree to which my brain believes that I’m here, the beauty of that sunrise,” everyone had to take his word for it. His comments that “we will have cities, maybe whole countries” developing in virtual reality where people will work full time sounded even more fantastical.

However, there is another more-grounded perspective to consider on the Metaverse’s progression from science fiction to viable business model. Igor Tishin, an Information Technology analyst at Harding Loevner, has thought a lot about the Metaverse and its implications for big technology companies—Facebook, Apple, Google, and Amazon as well as chipmakers and related equipment suppliers like NVIDIA, TSMC, and ASML—whose growth depends on continually expanding the applications of their technology. Still-evolving areas of technology like the Metaverse may be highly speculative, but these companies’ share prices already reflect an expectation that such growth opportunities will become a reality, and not in a too-distant timeframe. “A lot of people get hung up on how we’re going to get from where we are today to there,” Tishin says. By “there,” he means the Metaverse. “I’m more sanguine about the ability, and motivation, of these companies to figure it out.”


A Brief History of the Metaverse

The concept of the Metaverse has been a source of fascination, and hype, since before there was a commercial internet. Neal Stephenson originally coined the term in his 1992 novel Snow Crash. In the novel, considered a classic by tech professionals, users entered this original “Metaverse” via a pair of goggles onto which a 3-D world was holographically projected with a blueish beam of light. So, in 2012, when Google co-founder Sergei Brin arrived at a charity event in San Francisco wearing a pair of goggles with an eerie bluish, laser-like spot covering his right iris, it sent shockwaves through the tech industry. Within two years, however, Google’s consumer AR goggle product, Google Glass, would become the company’s highest-profile failure. Other companies’ stumbles have followed. Magic Leap, a much-hyped AR company, has repeatedly fallen short of its soaring ambitions to, among other things, create a humanlike virtual assistant or city-sized holographic overlay. And forecasters have continued to overshoot. In 2016, one industry group declared the market for AR and VR would reach US$150 billion in 2020—they were off by US$117 billion.2

Yet there is still an undeniable feeling that something must eventually replace the handheld screen. The exact next step for consumer tech is still up in the air, but many futurists in Silicon Valley believe it will be some combination of devices and platforms that delivers the sense of “presence” described by Sychov. To date, VR has mainly been applied to gaming. But recently tech captains have talked up VR’s practical applications like remote work. In interviews, Zuckerberg has reported conducting more of his meetings via the company’s new Horizon Workrooms VR platform and how helpful it is not only to meet remotely but also to share a sense of space with other people that allows a better read on body language or wheeling around to the same side of a table when working through a problem with a colleague.

At this point, anyone able to join Mark Zuckerberg in the Metaverse will be doing it as an avatar—interacting cartoon-to-cartoon, as it were. Achieving the body scanning, processing speeds, high-resolution cameras, and lens/displays capable of real-time photo-realistic image generation is an essential precondition of the next stage of the development of the Metaverse. Streaming capacity will also need to expand. In April 2020, Fortnite developer Epic Games co-produced a Travis Scott concert attended by more than 27 million avatars, all putatively beamed into the same venue in the Metaverse. In actuality, current technology can only handle a hundred or so avatars meeting at once; a technique called “sharding” is required to bring together thousands of these avatar groups to create a mostly identical and near-simultaneous communal digital experience. For billions to move about freely together in the Metaverse, the shards will somehow need to fuse.

Overcoming such hurdles is not a trivial endeavor. Nevertheless, Tishin says, “my suspicion is that we’re solidly in the realm of an engineering problem as opposed to a scientific problem.” The latter, like commercially viable nuclear fusion, cannot be solved without some fundamental breakthrough. With an engineering problem, the breakthroughs have already occurred, and the remaining challenges can be solved with time and money.


Next Steps

For now, the Metaverse is not a unified phenomenon, but a loose collection of devices, digital environments, and related technologies. Microsoft has spoken of its Digital Twins as an “enterprise Metaverse.” Google, as it happens, never fully abandoned Google Glass. It has continued to develop and sell the eyewear for enterprise customers, including the shipper DHL, whose workers use the glasses for item picking at its warehouses. The data and images that appear in the pickers’ field of vision, too, form an emerging Metaverse. Somnium Space is clearly a Metaverse, but so is Decentraland, where, earlier this year, parcels of digital land were going for the cryptocurrency equivalent of hundreds of thousands of dollars. Some users experience Decentraland in VR, but most simply choose to use the 2-D interface of their tablet or smart phone.

There will come a time, however, when all these individual platforms will merge to form the Metaverse. At least, that’s the vision articulated by venture capitalist Matthew Ball in a pair of widely circulated essays in May 2020 and June 2021.3 Ball elucidated some half dozen different developments (beyond the required engineering advancements) that need to occur before an all-encompassing Metaverse can be realized. One of them is a set of standard programming protocols—like HTML with which the web is built—to provide interoperability between platforms. Another is an integrated, functioning economy within the Metaverse that matches the freedom from the physical world’s constraints with a system— presumably relying on some version of blockchain—that establishes immediate and immutable provenance over economic goods and services.

No one can say with precision how long it will take for these pieces to fall into place or how big the economic opportunity could be. “The entire global economy is roughly US$84 trillion now,” Tishin observes. “In 10 years, it will be way over US$100 trillion. What percentage of that will have moved into the Metaverse? It’s clearly not all of it, or probably even most of it, but if it’s even one-tenth, you’re talking several trillions of dollars.”

During his “Ready Player One” conference presentation, Sychov tried to give a sense of how he sees the business opportunity unfolding in his corner of the Metaverse. Currently, Somnium Space generates most of its revenue from “primary” sales, including plots of virtual land as well as the commissions it charges on avatars,4 virtual cars, and other non-fungible tokens (NFTs). However, he projects the company’s revenues will increasingly come from the cut it takes on transactions between users when they exchange goods, services, games, and even whole sub-worlds created within its platform. As the user base grows from the couple thousand avatars a month who interact inside its virtual world now, he expects advertising naturally to follow. Already, Sony has erected a pop-up shop in Somnium Space to advertise its VR headsets.

Sychov predicts that it won’t be long before major brands catch on to the possibilities of taking things a step further. While commerce in the Metaverse at the early stages is likely to focus on virtual advertising for physical goods (a glorified extension of the internet, in other words), the next stage will be a shift to advertising for and selling virtual ones.

At one level, it is a preposterous (and deeply unsettling) idea that eventually many of us will be spending so much of our time inside the Metaverse that a company like Nike, for example, could be earning a significant portion of it profits producing shoes for avatars instead of physical sneakers. Tishin, however, isn’t ready to dismiss the possibility outright. “We’ve already seen with these concerts how some types of experiences could be just as good, if not better, experienced in the Metaverse. Travel could be another. Theme parks. The thrill of driving a really fast car. So, you’re likely to see the virtual economies working in parallel with the real ones.” There are important environmental and societal implications to what he is saying. With billions of people around the world rising into the middle class or else demanding more equal access to goods, services, and lifestyles, it may be more preposterous to assume the physical world can continue housing all those hopes and desires on its own.


Modeling the Metaverse

Of course, for the Metaverse to become the grand parallel economy Tishin describes, the devices will need to be so capable that, like smartphones today, they become essential tools to most consumers. Companies, meanwhile, will need to demonstrate the power of the platforms so they can attract developers to build experiences that draw in customers. As Tishin points out, the incipient Metaverse is at a common juncture in the development of new technology. Software like Netscape and Internet Explorer had to be written and proven useful for web browsing before they triggered the content explosion upon which our current 2-D internet is based. Amazon had to spend vast sums making the Kindle into a capable device before publishers took e-books seriously. Once they did, Amazon was able to cash in on the real prize, which was selling e-book content, not Kindles.

The history of technological development is important context for assessing the value of tech companies. Investors generally value companies based on projections for the rate of growth of their current businesses, but valuing tech companies also involves trying to get a financial handle on just this process: the future rewards that will come to those companies that succeed in exploiting totally new platform paradigms.

According to Tishin, two of the Metaverse’s biggest winners will likely be Facebook and Apple. Compared to Facebook, Apple has been relatively silent about its plans, “which suggests how serious they are,” says Tishin. Apple is the one company with the expertise and control over the entire technology stack to solve the engineering challenges in creating a viable Metaverse. The company has powerful, well-designed proprietary hardware, from chips to the devices themselves. These devices, running on Apple’s own operating system, form an ecosystem with over one billion users. And Apple has a straightforward business model for the Metaverse: to replicate in 3-D the experience of using an iPhone.

Tishin estimates what the impact of the Metaverse should be on Apple’s valuation by starting with the iPhone. Today, the iPhone alone generates about US$200 billion in revenue annually. In Tishin’s valuation model, he projects that in five years Apple will have an additional business selling goggles and glasses with AR/VR augmentation whose revenues will be just short of what the iPhone generates today—call it US$150 billion a year. To back the impact of that new business into his current estimation of Apple’s fair value, Tishin multiplies US$150 billion by Apple’s 37% gross margins, then multiplies that number by 10 (a conservative stock price multiple), and then again by his ballpark 75% probability that the whole effort actually materializes. When he divides that number (US$416 billion) by Apple’s 16.5 billion outstanding shares, he comes up with an added value from the hardware for accessing the Metaverse of US$25 per share by mid-decade. That’s one reason that Apple’s recent share price of around US$140 a share, at 28 times trailing earnings, actually strikes Tishin as pretty reasonable, even with the potential for some cannibalization of its existing hardware business.




An artist’s rendering of Apple’s planned VR/AR headset based on leaked documents and insider reports. It reportedly will hit the market in 2022 at a price of US$3,000. That compares to US$300 for the bulkier Facebook Oculus, suggesting the device will largely be used as a proving ground for even sleeker glasses. For its part, the company has only acknowledged it’s working on both projects. Source: Antonio DeRosa (aderosa.myportfolio.com)

Modeling the value of Facebook’s future in the Metaverse is a little more complicated. In a recent earnings call, Zuckerberg suggested that the company will spend over US$10 billion on Metaverse development in 2021. The only significant revenue those efforts are generating so far (annualized at US$3 billion in sales) is from its Oculus headset, widely regarded as the leading VR gadget on the market. In partnership with Ray-Ban, Facebook also recently unveiled its “smart glasses,” which are presently only smart enough to take photos, record videos, play music, and answer phone calls, but according to Facebook could soon deliver on some rudimentary aspects of the Metaverse in a stylish, user-friendly form factor. Zuckerberg has been careful to note, though, that none of the new hardware will necessarily change the way the company earns its profits—through advertising.

For a glimpse of how the company’s future advertising profits may play out, Facebook insiders have directed Tishin to Facebook Shops. This initiative, launched in partnership with the e-commerce platform Shopify, is Facebook’s attempt to build a marketplace that can rival Amazon, particularly for the new mode of “inspirational” shopping that is driven by social interactions and recommendations from friends. The Shops platform lets you use your phone’s video function to view a selfie of your face and “try on” a shade of lipstick that’s caught your eye to see how it looks with your skin tone. The company envisions a time when the lipstick—or your old college roommates, or your dermatologist—will appear with a simple wave of everyone’s wrist. In any event, all are more value-added ways to pull people into the company’s orbit so it can keep serving them ads.



AR lipstick on Facebook Shops. Source: Facebook

So how much is the Metaverse potentially worth to Facebook? Applying the same logic that he does to Apple—that in time the company will have a separate Metaverse-related business comparable to the size of its core business today—and accounting for a similar level of cannibalization, Tishin figures that in five years Facebook could be generating 50% more in ad revenues than it would be without the Metaverse. But he also thinks Facebook may be playing down the full scope of its monetization plans. “What if its platform becomes one of the main places where hundreds of millions of people around the planet are working, buying virtual tennis shoes, spending the afternoon in Paris. Wouldn’t it want to start taking a cut of developers’ revenue for bringing those experiences to people? In which case, the revenue opportunity could increase by an order of magnitude.”

This raises the question of why Facebook would spend time and money fiddling around with headsets. Although Facebook pulls in a fraction of Apple’s top line, its gross profit margins, which top 80%, dwarf those of its Cupertino rival. And Apple is the most efficient hardware maker in the world. But, Tishin says, Facebook could face a problem. If Apple does succeed in building the world’s best Metaverse hardware and operating system, it could also be able to set the fee structure for those who want to use its enabling platform.

Apple’s track record in that area can’t give Zuckerberg much peace of mind. The up to 30% commissions Apple charges on sales in its App Store have long been decried by developers as usurious. Recent concessions to app developers and a September court decision in a lawsuit by Epic Games suggest that Apple’s commission policies may be on the wane. But Apple has found a clever way both to deflect attention from its usurious practices and to create an alternative source of revenue: supporting the push for greater privacy protections. The safeguards it has implemented to prevent the data of iPhone users’ from being shared with third-party advertisers have severely crimped the ability of Facebook and Google to serve those users ads, effectively siphoning a not-insignificant portion of ad revenue to … Apple. “I don’t think every company is going to have exactly the same vision here,” Zuckerberg said recently, clearly a veiled reference to the potential for Apple’s current walled garden to carry over into the Metaverse. “I think some are going to have more siloed visions, and I, at least, believe that in order for this to work really well, you want it to be very portable and interconnected.”

Tishin sees Facebook’s hardware efforts (and the implicit threat that it could build out its own operating ecosystem that competes directly with Apple’s future Metaverse i-wearables business) as chiefly a form of leverage. “I could easily see Zuckerberg going to Apple CEO Tim Cook at some point and saying, ‘Look, we don’t want to keep making headsets and sunglasses, we’d much rather stick to selling ads, but you need to give us a break on the cut you take from people and businesses having entered the Metaverse through your wormhole.’”

As Tishin watches the Big Tech players arming themselves with the technology and strategies they believe will help them win, he is reminded of massively multiplayer online games (which, by the way, would be awesome inside the Metaverse). “All those warriors show up for the ultimate battle and, at first, there’s 2,000 of them. But then when it’s down to, like, six, they have to say to one another: Let’s stop. We can have a really nice life if we compromise instead of try to fight.”


INVESTMENT FUND DETAILS
The Pengana Harding Loevner International Fund is an actively managed portfolio of listed international securities that seeks to obtain returns greater than the MSCI All Country World Total Return Index (net) in $A over the medium to long term.

Contributors

Analyst Igor Tishin, PhD contributed research and viewpoints to this piece.

Endnotes

1 Where VR refers to a wholly virtual experience, AR involves the layering of the virtual atop the physical.

2 “Augmented Reality Market Size, Share & Trends Analysis Report by Component, by Display (HMD & Smart Glass, HUD, Handheld Devices), by Application, By Region, and Segment Forecasts, 2021-2028,” Grand View Research, February 2021.

3 “The Epic Games Primer: Parts I-VI Directory” (May 22, 2020); “The Metaverse Primer” (June 29, 2021), MathewBall.vc.

4 Artur Sychov reports having paid a creator US$2,000 for his avatar.

The dubious track record of ‘new’ nuclear technology

Will safety and economic problems that shut down similar reactors follow the industry to Wyoming?

Opinion
by Kerry Drake

November 30, 2021


A friend of mine says he has no problem with nuclear energy or “experimental” projects, but not when they are combined and linked to Wyoming.

I think it’s a sentiment many share. Residents know the state must find a replacement for fossil fuels to drive its economy, but offering the Equality State as the proving ground for new, “advanced” nuclear technology feels too risky.

Count me as a member of this group. That puts me at odds with advocates for the Natrium nuclear demonstration project — like state executives or Kemmerer officials anxious to save their town, which was chosen for the $4 billion facility. They say Wyoming needs to roll the dice and rake in the riches.

Such unfettered optimism is alluring. It’s easy to admire the vision of TerraPower founder Bill Gates: nuclear power plants replacing coal-fired facilities across the country and thus cutting planet-destroying carbon emissions. I understand why many want to jump on this bandwagon.

I don’t generally view myself as a “not-in-my-backyard” kind of guy. In this instance, though, I think it’s imperative to scrutinize the project at every stage.

There are myriad reasons for this cautious approach. Yet federal and state officials want to remove regulatory barriers and go full-speed ahead.

Safety heads the list. Yes, nuclear energy has been part of the nation’s electrical generation mix for decades, but Gates claims the Natrium sodium-cooled fast reactor, with molten salt-based energy storage, will produce less nuclear waste and be safer than a conventional light-water reactor.

The Union of Concerned Scientists, however, issued a report in March that sharply questions such assertions.

Sodium-cooled fast reactors, the report said, would likely be less “uranium-efficient” and not reduce the amount of waste that requires long-term isolation in a geologic repository. Sodium coolant can burn when exposed to air or water, and the organization said a demonstration project like the one proposed in Kemmerer “could experience uncontrollable power increases that result in rapid core melting.”

Gulp. If that scary scenario doesn’t warrant pumping the brakes in Wyoming, I don’t know what would.

But there are other important safety factors that also deserve attention. The Nuclear Regulatory Commission, under pressure to find carbon-free solutions to combat climate change, has been pushing to streamline safety and environmental reviews for advanced nuclear projects. The Wyoming Outdoor Council noted that the NRC is considering using a “generic” environmental impact statement, instead of detailed reviews of specific sites.

“We shouldn’t be cutting corners on health and safety to rush through an untested technology, and Wyoming’s harsh climate and seismic activity underscore the need for site-specific reviews,” WOC warned.

Wyoming officials, led by Gov. Mark Gordon, have enthusiastically endorsed the Natrium project, treating it purely as an economic windfall. But not only is there no guarantee such a boom will happen. In fact, other states’ and nations’ experiences strongly suggest it won’t.

In an open letter to Gates, Arnie Gunderson, a nuclear engineer who has spent 50 years working in the industry, called out the billionaire for leveraging his fortune “to siphon precious taxpayer funds supporting your latest atomic contrivance in Wyoming.”

TerraPower has a huge financial stake in the Kemmerer project, committing a total of $2 billion. It’s money that the corporation won’t recoup unless Natrium proves to be a reliable, safe alternative to fossil fuels that can be efficiently replicated at other facilities.

What happens to Kemmerer and Wyoming if TerraPower’s critics are right and the plug is ultimately pulled for safety or economic reasons?KERRY DRAKE

But without the backing of the federal government, Gates likely wouldn’t be in the game. That’s because nuclear reactors typically run way over budget, if they’re completed at all. The 345-megawatt Natrium project was originally announced as a $1 billion facility, but the price tag has quickly quadrupled.

President Joe Biden’s administration, anxious to meet international goals to halt climate change, is all-in on Natrium. The Department of Energy is matching Gates dollar-for-dollar to develop “new” sodium-cooled reactor technology that has failed since it was first introduced on the U.S. submarine Seawolf in the 1950s.

Other attempts include the privately financed Fermi 1 site near Lake Erie, which was shut down in 1966 after a partial meltdown; and at Clinch River in Tennessee. The latter, a publicly funded project, was plagued by delays and huge cost overruns, and Congress finally shut it down in the mid-1980s due to serious safety concerns.

In his letter to Gates, Gunderson detailed the epic failure of the Monju sodium-cooled fast breeder reactor in Japan. It took a decade to build and was shut down in 1995 after four months due to a sodium leak and fire. Monju wasn’t reopened until 2010, and permanently halted a year later after a refueling accident.

The cost to the Japanese government? More than $11 billion. Meanwhile, after decades of expensive research, France’s nuclear agency has shelved plans to build a prototype sodium-cooled nuclear reactor.

“So now is the time to stop the Natrium marketing hype and free up those precious public funds to pursue low-cost and dependable renewable energy during the time frame necessary to help prevent catastrophic climate crises!” Gunderson concluded.

Many scientists agree. “The recent attention on nuclear energy is fully driven by the declining industry’s desperation for capital and its related lobby depicting it as a solution for climate change,” Jan Haverkamp of Greenpeace told Deutsche Welle, a German news organization. “… It does so too late and at a far too high cost.”

The Kemmerer project at the Naughton coal-fired plant, owned by Rocky Mountain Power, has a timeline that will be difficult to meet unless every phase goes off without a hitch — something that’s nearly unheard of in the nuclear industry. If the Nuclear Regulatory Commission approves permits, construction would begin in 2024, with the reactor in service only four years later.

PacifiCorp, Rocky Mountain Power’s parent company, estimates that it will take about 2,000 workers to build the plant in Kemmerer and 250 to operate it. It presents the ultimate lottery ticket for a small mining community whose future looked mighty bleak when PacifiCorp announced plans to close the coal-fired plant.

So, here’s today’s $4 billion question: What happens to Kemmerer and Wyoming if TerraPower’s critics are right and the plug is ultimately pulled for safety or economic reasons?

Wyoming will survive, but not without cost. It will have lost all the time and energy the state could have devoted to finding long-term solutions to diversify its economy and stop relying on fossil fuels.

And Kemmerer? The town has experienced so much uncertainty in recent years, I hope it would use any reprieve from the nuclear industry to its advantage. State government must step in and require TerraPower to pay enough for mitigation to ensure that Kemmerer won’t be left in the lurch.

If Gates is going to ride into town promising to be its economic savior, Wyoming needs to hold him to it. Don’t make us sic the posse on you, pardner.

KERRY DRAKE
Veteran Wyoming journalist Kerry Drake has covered Wyoming for more than four decades, previously as a reporter and editor for the Wyoming Tribune-Eagle and Casper Star-Tribune. He lives in Cheyenne and... More by Kerry Drake

Nuclear energy "is not safe”

Portuguese Minister for Environment and Climate Action, João Pedro Matos Fernandes, has defended that the European Union (EU) should not finance nuclear energy projects because “it is not safe, it is not sustainable and costs a lot of money”.

By TPN/Lusa, in Environment, Portugal, Europe · 14 Nov 2021 · 

"We are not here to define the energy policies of any country. We are here to emphasise that it is really a bad decision to place nuclear within the European taxonomy. It is not safe, it is not sustainable and it costs a lot of money", he argued.

European financing, stressed Matos Fernandes, should be directed towards other options, mainly wind and solar energy, and he added that they are in contact with the private sector to take this same position.

“All the money that goes into nuclear energy is definitely money that should be put into renewable energy and that's what the world needs. We need energy, but it doesn't come from fossil [fuels]. And we need energy that does not contain nuclear waste”, he insisted.

In an intervention before Matos Fernandes, the German Environment Minister, Svenja Schulze, stated that “nuclear energy cannot be a solution to the climate crisis” because it is too risky, too slow and not sustainable.

Currently, around 12% of Germany's electricity comes from nuclear and half from renewable sources.

In 2011, after the accident at Japan's Fukushima nuclear power plant, German Chancellor Angela Merkel announced that it would end the country's 17 nuclear power plants by 2022, despite fears that this would lead to an increase in greenhouse gas emissions due to the use of gas and coal.

France is the third largest producer of nuclear energy in the world, behind the United States and China.

Nuclear energy 'can't solve' global warming, will 'strain' financial, natural resource
Thursday, November 25, 2021
 

Counterview Desk

 
Taking strong exception to Rafael Mariano Grossi, Director General, International Atomic Energy Agency (IAEA), who has favoured nuclear energy as a solution to global warning, well-known power and policy analyst Shankar Sharma has said that the IAEA chief's “unsubstantiated advocacy” of nuclear power is associated with “diversion of considerable amounts of scarce resources, both financial as well as natural, of many developing countries, such as India.”

In a letter to Grossi, Sharma, who is based in Sagar, Western Ghats, Karnataka, said, “The proposed Jaitapur Nuclear Power Project (6 reactors of 1,650 MWe each) in Maharashtra, the estimated cost per MWe is between INR 300 million to 400 million, whereas the lowest cost is for renewable energy sources of wind and solar backed by storage batteries, which is in the range of INR 80 million to 100 million per MW.”

Text:May I draw your kind attention to a few news articles, carried in the electronic media, in recent days on the relevance of nuclear energy in the context of Climate Change? These include one news report attributing a statement to you: "Nuclear energy is part of the solution to global warming, there's no way around it…"

An AFP report of November 7, 2021 says: "...For more than two decades, promoters and purveyors of nuclear energy felt shunned at UN climate change conferences. At the COP26 summit underway in Glasgow, however, they have been welcomed with open arms, the UN's top nuclear regulator told AFP. ‘Nuclear energy is part of the solution to global warming, there's no way around it,’ said Rafael Mariano Grossi, director general of the International Atomic Energy Agency, in an interview. It already accounts for a quarter of ‘clean’ -- that is, carbon-free -- energy worldwide, and Grossi said this COP is the first where it has ‘had a seat at the table’."

At around the same time, a few more news articles have also appeared advocating the increased usage of nuclear energy. These articles, as well as your own views (as carried in AFP report of November 7, 2021), have shocked many rational observers of the electricity sector from around the world, while also surprising many more observers of the global energy sector with the audacity of such advocacies even towards the end of 2021.

Your own statement, coming as the head of IAEA, may not surprise most observers of the nuclear power industry since IAEA has taken upon itself, for the last six decades, the role to relentlessly to promote the interest of nuclear power industry without satisfactorily addressing many associated serious concerns for the global communities.

But what is shocking is that even after scores of costly and bitter experiences associated with nuclear power, such as three major nuclear disasters at 3-mile Island, Chernobyl and Fukushima, many other advocates are continuing to ask for much wider usage of nuclear power without diligently considering various legitimate concerns associated with technical, economic, social, environmental, logistics, intergenerational issues. It is hard to accept that such a stubborn advocacy for nuclear power has borne out of honest consideration of true welfare of all the concerned global communities.

Such an unsubstantiated advocacy for nuclear power has also been associated with the diversion of considerable amounts of scarce resources, both financial as well as natural, of many developing countries, such as India, to artificially prop up an electricity generation technology which has not only humongous costs and risks, but also has negligible relevance to the energy security of such countries with low per capita electricity need/ demand.

Despite many intractable problems associated with nuclear power industry, such as calamitous risk of uncontrolled radiation leakage, non-existent nuclear waste management technology, nuclear terrorism risks etc., the consumer end price of nuclear energy may be acceptable to rich countries which also may have high per capita electricity demand.

But for poor and populous countries such as India, Bangladesh, Pakistan etc. which have some of the lowest per capita electricity need/ demand, nuclear power cannot be acceptable not only due to the high price at consumer end, but also due to many other concerns such as the ever growing constraints of resources (land, water, nuclear fuel etc.), unacceptable costs associated with nuclear accident risks for their densely populated communities, intergenerational health issues because of nuclear radiation, irrelevance of nuclear power in the context of Climate Change, enormous potential of locally available renewable energy sources etc.

In this larger context, what has been of very serious concern is that the gullible policy makers of these poor countries have fallen prey for the unsubstantiated advocacy by nuclear power advocates such as IAEA, and are committing the communities in these poor countries to all the associated costs/ risks/ concerns for many decades (or even centuries) to come.

Because of this grave scenario, IAEA, even if it honestly believes that "nuclear energy is part of the solution to global warming, there's no way around it," it should consider rendering truly a great service to the billions in these poor countries by clarifying the fact that nuclear power may not be suitable to many of the developing countries because of the poverty, population density, and the availability of suitable alternatives such as renewable energy sources.

In the case of India, I would like to point out the fact that despite massive financial support and the continued patronage given to nuclear power sector since seven decades, the aggregate nuclear power capacity in the country is only 6,780 MW, which is only about 1.7% of the total electric power generating capacity (as on 20.9.2021), and that this percentage of nuclear power to the total power capacity can only come down further in view of the national target to have 500 GW of renewable power by 2030, and the fact that lot more coal and hydel power capacities are also being planned.

Whereas India could commission only 6,780 MW capacity of nuclear power in about 70 years, its planners have unrealistically ambitious targets such as increasing the same to about 250,000 MW by 2070. Whereas such targets can easily be seen as ‘a pie in the sky’ due to the sheer physical impossibility linked to various obstacles in mobilisation of enormous resources needed, what is of even more concern to its communities is that a considerable share of country’s meagre resources will have to be diverted to such unrealistic dreams, while starving various other welfare activities including the development of renewable energy sources, which is lot more suitable to Indian conditions.

In this background, may I hope that IAEA will see it as a fundamental obligation to the global community to come out with satisfactory clarification to some of the major concerns as below immediately?

1. Can nuclear energy be an important part of the solution to global warming?In 2019, the total electricity generating capacity at the global level was 9,773 GW out of which nuclear capacity was only 369 GW, which amounts to only about 3.8%.

Actual electricity generated in 2019 reveals that only about 10.3% of total electricity came from nuclear power technology, whereas renewable energy (excluding hydro power) was 10.8%. This percentage of renewable energy capacity has been achieved only in about a decade to decade and half period, whereas nuclear energy has taken more than 7 decades.

Hence, nuclear power cannot be seen as making a substantial impact on the GHG emissions scenario at least in the near future. One global estimate indicates that in order to have any discernible benefit from the Climate Change perspective, nuclear power needs to be about 33% of the total installed power capacity at the global level.

This estimate also indicates that about 2,500 nuclear reactors of average capacity of 1,000 MW would be required, and nearly four new reactors would have to begin construction each month until 2075. If nuclear power were to play more than a marginal role in combating global warming, then some nuclear-power reactors would have to be operated even in those countries, where there is no nuclear power as of now.

Looking at the recent past experience of slow electricity demand growth, the increasing public opposition, the safety issues, and the threat of nuclear terrorism etc. such a huge addition of installed capacity is impossible.

For a resource constrained and densely populated country like India, diversion of thousands of Sq. km of its agricultural/ forest lands for setting up hundreds of nuclear reactors, including the safety zones, can be said to be next to impossible.

In such a scenario, why should the most costly and risky technology of electricity generation be a part of our energy basket, when we have many benign options available?

2. Can nuclear energy ever be competitive with other sources of electricity?For a developing country like India, the capital cost and hence the consumer end price of nuclear power should be a critical factor in choosing the energy technology option. As of today, nuclear power is evidently the costliest option for India (as is elsewhere), and is only likely to be the costliest option by a huge margin even in future.

For the proposed Jaitapur Nuclear Power Project (6 reactors of 1,650 MWe each) in Maharashtra state in the country, the estimated cost per MWe is between INR 300 million to 400 million, whereas the lowest cost is for renewable energy sources of wind and solar backed by storage batteries, which is in the range of INR 80 million to 100 million per MW.

This stark contrast in capital costs is corroborated by a recent LCOE analysis by Investment bank Lazard (15th edition of its highly regarded Levelised Cost of Energy Analysis). It goes to show that wind and solar don’t just beat new installations, they are by and large competitive with even existing coal, gas and nuclear plants, even after the huge capital costs of those plants have been amortised.

In all cases, they are five times cheaper than nuclear power plants. Even storage and network costs don’t come close to making up the difference. Such a contrast in capital costs can only become much starker in the future because of the continued efficiency increases in solar, wind power, and energy storage battery technologies on one hand, and the continued escalation of capital costs of nuclear power on the other hand. It is reasonable to assume that these issues will be similar to all other poor/ developing countries also.

Under the title “List of cancelled nuclear reactors in the US”, Wikipedia has provided the details of about 200 cancelled reactors, including many in the construction stage, stating that: “Of the 253 nuclear power reactors originally ordered in the United States from 1953 to 2008, 48 percent were cancelled, 11 percent were prematurely shut down, 14 percent experienced at least a one-year-or-more outage, and 27 percent are operating without having a year-plus outage. Thus, only about one fourth of those ordered, or about half of those completed, are still operating and have proved relatively reliable.”

What a journey for the nuclear power industry: from the tall claims of ‘endless and cheap even to meter energy’, to never ending claims of innovations (such as Magnox, AGR, PWR, BWR, CANDU, RBMK, gas cooled reactors, fast breeder reactors etc.), to Fusion reactors and Small Modular Reactors etc.; to a large number of cancelled reactors in the US, to cost and time over-runs etc.; but totalling only about 3.8% of the global electricity capacity; and now to the tagline of ‘costliest and riskiest power generation technology’, and associated with concerns on global nuclear terrorism and intergenerational waste management issues.

The unsubstantiated and exaggerated claims of nuclear power establishment can also be highlighted by the turnaround from its initial advocacy for large size nuclear reactor units and multiple units in a single location (for the sake of economy) a few decades ago, to Small Modular Reactors which are in the experimental stage now.

In the context of these evidently glaring facts, it should become obvious that a poor country like India should not waste its meagre resources on nuclear power technology, which evidently has no true relevance to its energy future, and also because it has humongous potential in renewable energy.

Whereas, the above discussed two main considerations alone can be seen as ‘the necessary and sufficient factors’ for poor countries like India to shun nuclear power technology for their future, a host of other concerns such as cost and time overruns (such as Flamanville, France; Olkilouto, Finland; Hinkley Point C in UK; Vogtle in US), over-reliance on imported technology/ nuclear fuel, calamitous threats of nuclear accidents, public opposition etc. will be very serious, if not unsurmountable, hurdles.

The PDF version of a representation to the Indian government (as attached) highlighting enormous societal concerns on the approval given to a capacity extension plan of an existing nuclear power plant in the state of Karnataka, has listed a large number of such costs/ risks to the local communities.

If IAEA, being a high profile and influential global entity, chooses to continue to push for the wider acceptance of nuclear power technology, the minimum obligation it should take upon itself is to provide adequate clarification to each of the concerns as discussed above, as contained in the enclosed file, and as applicable to India and other developing countries.

a) Despite enormous investment and political patronage since the 1950s why the nuclear power capacity at the global level has not lived up to the tall claims of its captains, and why it has remained at a very low production capacity; even as compared to the recent technologies such as solar and wind power?

b) In the background of the fact that USA, USSR/Russia, and Japan, which were all known to be the leaders in technological issues, and which are also generally associated with quality and safety issues, have experienced one or more major nuclear accidents, how can IAEA assure the global community in averting nuclear accidents?

c) In the background of three major nuclear accidents, and many near misses, can we afford to ignore the “precautionary principle” as enunciated by the international convention on biodiversity?

d) Can IAEA provide the necessary details of one or two locations and the technology deployed for the long-term storage of nuclear wastes (nuclear waste depository), and confidently state that the same are cost effectively replicable anywhere else?

e) Can we afford to ignore the caution by many reports/ articles which have appeared in the media and by leading personalities such as Mikhail Gorbachev, UN Secretary General, Japanese Prime Minister at the time of Fukushima disaster, Physicians for Social Responsibility, Dr A Gopala Krishnan (of AERB, India), Dr Balram (of IISc, India) etc.?

f) What are the recommendations by IAEA to effectively address the threats of global nuclear terrorism w.r.t the concerns expressed by many political leaders?

g) Whether the costs, which we need to pass on to the future generations (in safeguarding the nuclear waste for thousands of years), are justifiable since there will be no benefits to these generations? How many times more electricity will the nuclear fuel cycle consume (including that of safety of nuclear waste) as compared to the electricity it can generate in its economic life cycle of about 40 years?

h) What are all the direct and indirect costs to the society of nuclear power as compared to the benefits in a poor country such as India? Are such benefits unquestionably higher than the costs? Through an objective study of Costs & Benefits Analysis, as a decision-making tool, can IAEA establish beyond reasonable doubt that every nuclear power plant has more benefits than costs to society?

i) What is the typical Life Cycle Cost of a nuclear power plant (such as one in the US, including the nuclear ore mining and nuclear waste management stages); and what is the volume of associated life cycle emission of CO2/MWh of energy produced?

j) In view of the fact that renewable energy sources have become so competitive not to require subsidies, can the nuclear establishment shun all kinds of subsidies, including the claim for exemption from civil nuclear liability clauses?

k) Can the nuclear establishment take the public at large for complete confidence by sharing all the relevant information asked for?

l) How will IAEA ensure that all the stakeholders are party to the carefully considered decisions on setting up nuclear power plants in each country?

IAEA’s continued advocacy on nuclear power can be seen as a clear parallel to the relentless and dangerous advocacy on fossil fuels by the International Energy Agency (IEA) till recently (despite repeated concerns the concerned individuals and NGOs), which has led to the UN's clarion call to move away from fossil fuels urgently to save humanity. In this larger context, your statement that "Nuclear energy is part of the solution to global warming, there's no way around it…" will need a lot of explanations to substantiate the same.

May I hope that IAEA will come out with these and many other clarifications soon?
Your acknowledgement of this mail will be deeply appreciated.

Diablo’s Planet-Killing Nuke Insanity Keeps Escalating

December 11, 2021

Opinion – Harvey Wasserman

Amidst our ever-escalating climate Apocalypse, the viral insanity of atomic power gets ever worse. Now it’s spread deep into the Biden Administration, with no apparent cure in sight.

Nowhere is the atomic disease more potentially lethal than at California’s ancient, aging, embrittled reactors at Diablo Canyon.

Throughout the US there are now 93 big licensed commercial reactors. Except for one, they are all more than 30 years old. Many are more than 40.

Worldwide there are more than 400.

After more than 60 years of uneven operation, the US nuke industry still can’t get private insurance. Any American reactor could be blowing up as you read this, taking down your health, your family, your home.

Since there’s no private insurer (your homeowner’s policy explicitly excludes liability from any reactor disaster) you’ll have no recourse beyond a very limited federal taxpayer fund…if that.

Over the decades the industry has touted one “Nuclear Renaissance” after another. Each time, with a few pliant “environmentalists” in tow, they declare atomic energy’s time has really really come.

At least such two such “green advocates” have turned out to be big-time climate deniers.

But never mind.

Atomic reactors burn at 571 degrees Fahrenheit. They trash every ecosphere they encounter. Billions of marine creatures die daily from their heat, chemical and radioactive emissions. Thousands of birds crash into their cooling towers. Countless humans die from the radiation they constantly pour into our air and water.

When reactors open, the nearby downwind human infant death rates rise. When they close, those rates drop.

The human death toll at Three Mile Island was significant (I went there in 1980 and interviewed stricken families; it was the worst week of my life). The death toll from Chernobyl exceeds a million. Fukushima emitted more than 100x the radioactive cesium than did the bombings of Hiroshima and Nagasaki.

All of them racked up gargantuan economic and opportunity costs that can never be repaid.

With no solution to the nuclear waste problem, Fukushima is poised to dump millions of gallons of heavily irradiated liquids into the Pacific Ocean. At Pilgrim, south of Boston, the industry wants to dump huge quantities of radioactive water from the long-shut Pilgrim reactor into Cape Cod Bay.

In South Carolina, two reactors at V.C. Summer shut without opening, wasting $10 billion that could have solarized much of the state. At Vogtle, Georgia, a twin reactor project has just crossed the $30 billion mark, and can’t open at least until 2022—if ever.

Endless happy talk about small reactors, thorium reactors, fusion reactors, breeder reactors and whatever else Bill Gates perpetrates studiously ignore the fact that even their most wide-eyed projections show they can’t compete now with renewables, and never will.

Solar, wind, battery and efficiency technologies have so far outstripped initial projections in terms of cost, safety and availability that no nuclear technology—on line now or at some point in the mythological future—can ever hope to compete.

But somehow the mandates of the “free market” disappear as corporate cash buys the gerrymandered legislatures needed to scam public money to keep these dinosaurs alive.

And that’s where the real danger comes in. Future reactors are wasteful but perfectly harmless as long as they’re not built.

It’s the ones now terminally hot that hang like over our heads like swords on strings.

The 93 operating US nukes are falling apart. They’re allegedly kept safe by the Nuclear Regulatory Commission. But anyone familiar with the industry knows the NRC really stands for Nobody Really Cares. Some of its staff is competent and caring. But the five Commissioners are historically corrupt, Soviet-style puppets who mostly take their marching orders straight from the industry they’re supposed to regulate.

That means our aging nukes — every one of them without private accident insurance — are each incredibly dangerous.

It’s one thing to debate the broad issue of nuke power — the waste, the surety of more melt-downs, the emissions, the costs, the health disasters.

But it’s quite another to realistically deal with each of these reactors on a case-by-case basis. In fact, every US nuke is its own terrifying likely-to-blow reality.

Take Ohio’s Davis-Besse, near Toledo. Its astonishing history of neglect, decay, near-misses and on-going corruption boggle the mind. To gorge on a proposed billion-dollar public bailout, its owners slipped a $61 million bribe to Larry Householder, then the Speaker of the Ohio House.

Householder is gone, but the slipshod, corner-cutting Chernobyl-style non-maintenance at Davis-Besse goes on.

Alabama’s Browns Ferry was set on fire with a candle. Arizona’s Palo Verde daily turns millions of gallons of precious water into steam. Nebraska’s Fort Calhoun and Cooper have both been flooded. Sea- and lake-side reactors will soon be under water. Many could be swamped by dam breaks.

The code red list goes on. But none exceed Diablo Canyon, near San Luis Obispo. And it’s the two reactors there that the Biden Administration now insanely wants to save.

More Americans have been arrested at Diablo than at any other nuke. Badly built just 45 miles from the San Andreas fault, and just 180 miles from Los Angeles, the seaside reactors could easily lose their cooling systems to a Fukushima-style quake/tsunami.

More than 30 years old, their radioactive clouds would reach the ten million people in LA County within five hours. Evacuation is inconceivable, the death toll unfathomable.

Most critically, Diablo’s ancient Unit One is severely embrittled. As a nuke’s interior metals are subjected over the decades to intense heat, pressure and radiation, their resilience disappears. As they become brittle they grow vulnerable to the kind of intense shock that could come when emergency cooling water is poured into a melting reactor.

Should that happen in the middle of a melt-down, the nuke’s interior metals would shatter. The resulting steam explosion would blow the structure apart, throwing apocalyptic clouds of radioactive gases, metals and structural concrete into the sea and atmosphere.

Yet Diablo is operated by Pacific Gas … Electric, which has been twice convicted of criminal manslaughter (involving up to a hundred human deaths) and which has burned down much of northern California. To say PG…E has zero credibility as a reactor operator is to vastly understate the case.

A series of intense negotiations has led to a plan to shut Diablo Unit One in 2024, followed by Unit Two in 2025. A broad coalition of communities, unions, environmental, regulatory, citizens and other groups deemed that California would emerge safer, more prosperous and more ecologically sound once those reactors were shut.

But now Team Biden wants to trash all that. Energy Secretary Jennifer Granholm and the usual industry stooges are attacking the shut-down deal and fighting to keep Diablo open.

A petition calling for an independent Diablo embrittlement inspection has been signed by more than two thousand Californians, including Hollywood A-Listers Jane Fonda, Lily Tomlin, Martin Sheen, Eric Roberts, Jodi Evans, Mimi Kennedy, Graham Nash and many more. Governor Gavin Newsom has ignored the request, as has Biden’s Department of Energy.

The idea that Diablo’s operations could be prolonged without an independent investigation is beyond insane. The one thing the site has to offer of long-term value is its transmission switching station, which could easily handle major megawatts of juice coming in from the offshore wind turbines that should be built to power California’s future.

The idea that Diablo’s operations could be prolonged without an independent investigation is beyond insane. The allegedly “green” administration is pushing the envelope on the incredibly dangerous, wasteful, uninsured and ecologically catastrophic engine of mass death.

Can we stop them before Diablo or some other errant nuke blows up and terminally irradiates millions of innocent downwinders along with our planetary eco-systems?

The answer must come VERY soon.

Harvey Wasserman co-convenes the weekly Election Protection 2024 ZOOM. His People’s Spiral of US History is at www.solartopia.org.

Content Sourced from scoop.co.nz
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The Theranos Trial Shows Why We Should Be Suspicious of Nuclear Fusion

BY CHARLES SEIFE

DEC 08, 2021

Former Theranos founder and CEO Elizabeth Holmes. 

Amy Osborne/Getty Images

The Theranos story is an epic tale of folly with lots of twists and turns, but it’s by no means unique. At the very same moment the play-by-play of the Elizabeth Holmes trial sprawls across the drama section of your daily paper, the pages of the business section are filled with adulatory copy regarding other science-techy startups. Inevitably, some of them will end up with financial losses that are even bigger, thanks to technology that is even shakier, business models that are more delusional, and exaggerations that are nearly as bold as anything associated with Holmes’ fiction-enhanced blood-testing company. These “startups” all promise limitless clean energy: power from nuclear fusion and a rapid transformation of our energy supply away from fossil fuels.

At this point, nobody’s claiming that there’s fraud in the fusion sector, though the exaggerated claims coming from the companies and the media are rapidly becoming as detached from reality as a Tucker Carlson monologue. Read the papers and it seems like a fusion power plant is imminent—we’re just a few years away from our first fusion generator and then to widespread commercialization. After all, that’s what the fusion companies themselves are saying. Tokamak Energy: A working power plant connected to the grid by 2030. General Fusion: Demonstration power plant beginning operations in 2025. Helion Energy: We’ll do it in 2024. First Light Fusion: Yeah, 2024. Zap Energy: 2023—so there! But if we’ve learned anything from the Theranos debacle, it’s that we can’t take any company’s claim at face value when “fake it till you make it” is a standard corporate motto.

There’s one key distinction, though. The fusioneers don’t really even have to fake anything. Unlike Theranos, which built (terribly flawed) hardware that was used to analyze patient samples, not a single one of the nuclear fusion “startups” has produced a prototype machine that they propose to base their business upon. Nobody has demonstrated that they’re even close to building a fusion device that produces—rather than consumes—energy. Luckily for them, assurances of honorable intentions have been sufficient for investors. These companies are able to trade on promises, not products. Yet despite the short history of purely commercial fusion, those promises already have a history of being broken. In 2016, Tokamak Energy promised energy production in five years. General Fusion: prototype plant within a decade—and that was in 2009. Most recently, the press went gaga in November over Helion Energy’s raising $2.2 billion in venture capital to build a working reactor by 2024. Almost none of that coverage mentioned Helion Energy’s business plan of building “a useful reactor in the next three years” way back in 2015, when it had only raised some $10 million. It’s the exact same promise, resold six years later at 200 times the price.

That’s the one real, concrete success of the fusion startups that you can point to: not extracting energy from seawater, but extracting money from speculators. If you measure scientific progress by venture capital raised, then, yes, the industry has been making huge strides. In just the past few weeks, Helion’s $2.2 billion and Commonwealth Fusion Systems’ $1.8 billion each surpassed Theranos’ estimated $1.3 billion capitalization at its peak. (And Theranos had a deal with Walgreens to show investors.) Speculators can now lose far more money chasing after fusion than they ever could by falling in thrall to Elizabeth Holmes.

Of course, fundraising isn’t a valid measure of scientific progress; however, you wouldn’t be able to tell that by reading press coverage. We now realize that media credulity helped build Theranos’ fortunes. A good, hard look at Theranos’ claims should have brought the house of cards tumbling down far earlier. Oddly, none of that seems to motivate journalists to cast a skeptical eye at the viability of the fusioneers’ technology (which ranges from the moderately plausible to the ridiculous) or their business models for making money if they are eventually able to prove their technology works (which range from the nonexistent to the nearly nonexistent).

Imagine that, against the odds, one of these startups succeeds. It manages to achieve fusion “breakeven” and get more energy out of a reaction than it puts in. Say that the excess energy is so great that all the inefficiencies of getting the reaction going (which haven’t been overcome) or capturing the energy and turning it into electricity (which most companies haven’t started to address seriously) are not a problem. Imagine, too, that the startup somehow has a patent on a key MacGuffin in the reactor that other companies with expertise in high-tech and power plant manufacturing can’t match. Then, and only then, can the company be reasonably assured of making money from energy production—if its plants bring energy to the market at a competitive price.

This last bit is far from easy. Given the overhead of building a high-tech plant that produces low-level nuclear waste that needs to be disposed of (yes, fusion produces nuclear waste!), it’s a good guess that the cost per megawatt will be at least as great as the cost of traditional fission nuclear power plants—which is quite a bit more expensive than gas- or coal-fired plant power. This isn’t to say that it won’t contribute to the nation’s energy-generating portfolio, but it’s not likely to be a game-changer or the stuff of an energy unicorn.

Yet if you listen to the rhetoric coming out of some of those fusion startups, you’re led to believe that it will be much cheaper to build, maintain, run, and decommission super-high-tech fusion plants than an equivalent coal plant. That is, it’s easier to set up a nuclear magnetic bottle and mimic the inner workings of the sun than it is to throw a rock into a raging fire. That, my friends, is bat-guano insane. As the Theranos trial is making clear, it’s not so easy to tell the difference between puffery and outright fraud. In my opinion, anyone telling investors that they’re going to produce energy at a third of the price of coal should brush up on the George Costanza defense: “It’s not a lie if you believe it.”

One of the strangest distortions about the whole fusion-energy-sector brouhaha is the way funders and business journalists treat all these fusion companies as startups. Some of them, such as Commonwealth Fusion Systems (founded 2018), aren’t too far off the mark. But others like Tokamak Energy (2009), General Fusion (2002), and TAE—the company formerly known as Tri Alpha Energy (1998)—are startups in the same sense that Cher is fresh new talent. After five, or 10, or 20 years of riding on potential, it’s time to admit that the potential wasn’t really there in the first place—at the very least, not in the way that the “startup” envisioned.

So who cares if a company sponges off VC and pretends to be a pre-IPO ingenue until it’s old enough to be drafted? Not long ago, it wouldn’t matter at all to your average investor. Only venture capitalists, angel investors, and other folks with very big wallets and a high tolerance for risk would lose money by putting cash down on a decade-old pseudo-startup without even a fully developed product to put on the market. After all, they’re supposed to be sophisticated investors who know the risks that they’re taking, and if they didn’t do due diligence, well, that’s the downside of capitalism. But the rules have changed, and now we’re all targets.

For years, only “accredited” investors—people who have high incomes or net worth, and are presumed to have a decent understanding of securities trading—were allowed to invest in unregistered securities, such as stocks in a pre-IPO company. But that changed about a decade ago, when Congress decided to allow ordinary citizens to invest in these companies via crowdfunding. There were some protections built into the law: Companies could only raise a certain amount of money through crowdfunding, limiting the public’s exposure to risk. (Of course, those protections are steadily dissolving.) So it’s no surprise that the naïve investor has become a target for fusion boosters. Lawrenceville Plasma Physics (founded in 2003 by a big-bang denialist) has been living crowdfund-to-mouth since 2014 when it raised about $200,000 with the promise of a working fusion machine by the year 2020. Its latest “stock” sale, which happened a few months ago, raised more than $2.2 million, while suggesting to investors that it would have a functional prototype within three years.

Fusion companies are giving Theranos a run for its money, yet the news coverage of them seems to be almost universally uncritical. Huge sums of money have flowed into their coffers—making Theranos’ mere billion and change look like small potatoes—in return for vague, often obviously broken promises of prototypes that fail to appear despite decades of trying. Despite the total void where a product should be, these companies are successfully convincing investors both big and small to part with their money.

Caveat empty.

Future Tense is a partnership of Slate, New America, and Arizona State University that examines emerging technologies, public policy, and society.

NUCLEAR FUSION AT 100: THE HIDDEN RACE FOR ENERGY SUPREMACY

by: Maya Posch

HACKADAY
January 23, 2020



It’s hardly a secret that nuclear fusion has had a rough time when it comes to its image in the media: the miracle power source that is always ‘just ten years away’. Even if no self-respecting physicist would ever make such a statement, the arrival of commercial nuclear fusion power cannot come quickly enough for many. With the promise of virtually endless, clean energy with no waste, it does truly sound like something from a science-fiction story.

Meanwhile, in the world of non-fiction, generations of scientists have dedicated their careers to understanding better how plasma in a reactor behaves, how to contain it and what types of fuels would work best for a fusion reactor, especially one that has to run continuously, with a net positive energy output. In this regard, 2020 is an exciting year, with the German Wendelstein 7-X stellarator reaching its final configuration, and the Chinese HL-2M tokamak about to fire up.

Join me after the break as I look into what a century of progress in fusion research has brought us and where it will take us next.


PREVIOUSLY IN PURSUIT OF NUCLEAR FUSION

The discovery that the total mass equivalent of four hydrogen atoms is more than that of a single helium (4He) atom was made in 1920 by British physicist Francis William Aston. This observation led to the conclusion that net energy can be released when one fuses hydrogen cores together, for example in the common deuterium (2D) tritium (3T) reaction:



Deuterium (2H, or D) is a common, stable isotope of hydrogen that occurs naturally in abundance, to the rate of 0.02% of the hydrogen in Earth’s oceans. Tritium (3H, or T) is an unstable, radioactive (beta emitter) isotope of hydrogen, with a half-life of 12.32 years. Tritium is formed naturally by the interaction with cosmic rays, but can be easily bred from lithium metal, either in a breeder blanket in a fusion reactor, or from a fission reactor that uses heavy water (deuterium), like Canada’s CANDU reactors.

The UK ZETA Z-pinch fusion reactor in 1958.

The first neutrons from nuclear fusion were detected in 1933 by staff members of Ernest Rutherfords’ at the University of Cambridge. This involved the acceleration of protons towards a target with energies of up to 600 keV. Research on the topic during the 1930s would lay the foundation for the development of the first concepts for fusion reactors, initially involving the Z-pinch concept which uses the Lorentz force to contain the plasma.

Teams around the world worked in absolute secrecy, with all fusion-related research being classified. The British created the ZETA stabilized pinch fusion reactor, with the hope that this would prove to be a viable blueprint for commercial fusion reactors. Unfortunately, ZETA proved that the Z-pinch design would always suffer from instabilities, and by 1961 the Z-pinch concept was abandoned.

Meanwhile, the Russians had developed the tokamak reactor concept during the 1950s, partially based on the Z-pinch design. The tokamak design proved to be able to suppress the instabilities that had plagued Z-pinch reactors, as well as early stellerator designs. These days, most fusion reactors in operation are of the tokamak design, though the stellarator has seen a resurgence recently, especially in the form of the Wendelstein 7-X project.

WHAT WE CAN EXPECT TO SEE IN 2020

A schematic view of Wendelstein 7-X’s magnets.

As mentioned in the article introduction, Wendelstein 7-X has reached an important milestone. Since we first wrote about this project back in 2015, the project has worked through all of its targets except the final one: cooled divertor operation. The reactor is currently being upgraded with these divertors which should theoretically allow for steady-state operation, allowing for impurities to be removed from the plasma during operation.

Installing the new divertors and cryopumps will continue into much of 2020, involving the running of a 55 meter long transfer line to the cryoplant, along with the installation of new storage tanks for helium gas and liquid nitrogen. With some luck we’ll see the first tests of the new system this year, but most likely the first continuous operations of WX-7 will take place in 2021.

China’s HL-2M tokamak at Southwestern Institute of Physics (SWIP).

Over in China, the final touches have been put on its HL-2M tokamak, which is the latest in a range of tokamak designs since the 1960s. The HL-2M is the new configuration of the HL-2A tokamak, one of three tokamaks currently in use in China (EAST and J-TEXT being the other two). HL-2M has seen big changes to its coil configuration that allow for the creation of many types of plasma, along with the testing of various types of divertor configurations. This year HL-2M will see its first plasma.

Depending on the performance of HL-2M, it will allow for the CFETR (China Fusion Engineering Test Reactor) project to start its construction phase in the 2020s. In its first phase, the CFETR tokamak would demonstrate steady-state operation and tritium breeding. In its second phase CFETR would be updated to allow for a power output of 1 GW (compared to ITER’s 500 MW) and a fusion gain (Q) higher than 12.
FUSION IS HARD

The main reason why nuclear fusion is taking so long compared to nuclear fission is that the former requires the ideal conditions to even occur, let alone persist. This means high temperatures, high pressures, high currents, or a combination thereof. Even then plasma containment is notoriously complicated, as the plasma isn’t a nice, calm gaseous state that’s just kinda floating there. Rather it’s a seething collection of plasma at high pressures and many millions of degrees Celsius that’ll breach through the magnetic confinement any chance it gets. Although significant progress has been made here, the coming years will tell whether we’ll avoid a Z-pinch-like dead-end with the tokamak and stellarator designs.

Many aspects of running a nuclear fusion reactor remain somewhat of a mystery, much as it was with the first fission reactors, where early generation II designs saw countless changes to materials used, along with fundamental changes to the overall design to improve performance and safety. Although fusion reactors are less challenging in this regard, they do have to deal with the neutron bombardment of materials in the core, which can weaken them. This also leads to the only waste that is produced by fusion reactors: the reactor core itself.

A combination of activation through this exposure to neutrons, along with contamination with tritium will render core materials radioactive, requiring handling of the resulting low- to intermediate- level radioactive waste like steel and other building materials at the end of the reactor’s lifespan. Fortunately, studies have shown that intermediate storage of up to 100 years is sufficient to render these materials safe.

Regardless, the neutron exposure is one aspect which can likely be dealt with in a more direct way through material selection or through neutron capture mechanisms in future reactor designs. As China’s program evolves through HL-2M into CFETR and ITER into DEMO, the hope is that we can catch any issues and make improvements before fusion hits prime time.

LOW ENERGY NUCLEAR REACTIONS

Tangentially related to fusion, LENR is what used to be called ‘Cold Fusion’. Marred by decades of ridicule, a number of scientists have nonetheless persisted in examining the phenomenon that lit up the world with promises of fusion power at room temperature. Dismissing the original theory of hydrogen atoms fusing, the current theory is that protons and electrons can be merged to form neutrons. For a detailed overview, see for example this video presentation by Prof. Peter Hagelstein, an MIT associate professor.

According to the Widom-Larsen theory, the reason why the original 1989 experiment was so hard to recreate is because it relies on hydrogen atoms settling on active sites on the palladium (or equivalent) layer. This means that one needs to create a suitable surface on a nano level, something which was not realistic in the 1980s.

Even if LENR never turns into anything more than a curiosity, it does give us a glimpse in another way that atoms seem to behave. Best case it might provide us with ways to improve fusion reactors in ways that we cannot fathom today, by lowering pressure and temperature requirements.

ENERGY DOMINANCE IS THE GAME

A commercial fusion reactor would be essentially the pinnacle of energy generation, barring the development of anti-matter reactors or such. As an energy source, its fuel is practically unlimited, with the deuterium-tritium type having enough fuel on Earth for millions of years, and the deuterium process version offering billions of years of energy production using just the deuterium available on Earth. The first nation to master this capability stands to gain a lot.

Colony in space, with a clear view of nearby planets.

Fusion reactors are inherently safe, due to the complexity of maintaining the proper conditions for the fusion process to take place. During operation, no waste is produced, but instead very useful helium (4He) is created which has countless applications in everything from industry to running MRI scanners, to filling up party balloons. While nuclear fusion will very likely co-exist with nuclear fission (possibly using FNRs) in a complementary fashion, the former being ideally suited to handle electricity and heat generation for all population centers on Earth.

Exactly when we’ll see the first commercially viable fusion reactor appear is hard to tell at this point. With ITER not projected to see first plasma until 2035, we might see China with its CFETR and successor reactors reach the point of commercial viability by the 2030s or 2040s. Yet as the UK learned with ZETA, in plasma physics nothing is certain.

[Main image: Experimental visualization of the field line on a magnetic surface in Wendelstein 7-X. CC-BY 4.0, Wendelstein 7-X team]Posted in Featured, green hacks, Interest, Science, SliderTagged cfetr, deuterium, hl-2m, ITER, nuclear fission, nuclear fusion, Tritium, wendelstein 7-x, wx-7

TECHNO MYTHOS

Is nuclear fusion the 'hottest' new renewable on the block?

Tokamak Energy's reactor could be where nuclear fusion first occurs. - Copyright Tokamak Energy

By Lottie Limb • Updated: 13/12/2021 - 16:59

A small railway town in southern England could go down in history as the place where nuclear fusion kicked off.

The reaction process - which would generate vast amounts of low-carbon energy - has evaded scientists for decades, but a private company in Didcot, Oxfordshire says it’s now a question of if, not when.

Tokamak Energy is firing its nuclear reactor up to 50 million degrees celsius - almost twice the core temperature of the sun. By shooting 140,000 amps of electricity into a cloud of hydrogen gas, the team are trying to force hydrogen atoms to fuse, thereby creating helium.

These fusion forces are the same ones that power the sun. While there’s no danger that Didcot could become the new centre of the solar system, the industrial estate could spark the start of a cheap, clean energy supply.

Nuclear fusion poses huge technical challenges.

Tokamak Energy

“We will crack it,” CEO Chris Kelsall told the BBC on a recent trip, “the answer is out there right now with Mother Nature as we speak. What we have to do is find that key and unlock the safe to that solution. It will be found.”

Having ramped the temperature up to mind-boggling degrees, the experiment’s next step is to see if nuclear fusion can produce more energy than it uses.

Is nuclear fusion safe?

In case it rings alarm bells to anyone in the vicinity, nuclear fusion is very different from nuclear fission and its associated disasters

The process occurs inside a ‘tokamak’ - a device which uses a powerful magnetic field to contain the swirling cloud of hydrogen gas. This stops the superheated plasma from touching the edge of the vessel, as it would otherwise melt anything it comes into contact with.

If anything goes wrong inside a fusion reactor, the device just stops - so there’s no risk of this astronomical heat being unleashed.

Magnetic fields trap the electrically-charged plasma particles in an 'apple-core' shape, keeping the fusion fuels contained and hot.

Tokamak Energy

The plasma has to be heated to 10 times the temperature of the sun to get it going, and is capable of fusing two hydrogen nuclei into a helium nucleus.

Nuclear fission, on the other hand, is the dangerous kind. This creates energy by splitting one ‘heavy’ atom (typically uranium) into two. This breakdown generates a large amount of radioactive waste in the process, which remains hazardous for years.

Fusion cannot produce a runaway chain reaction, like the one that happened at Chernobyl in 1986, so no exclusion zone is needed around Milton Park, Didcot, where the reactor is based.

Laura Hussey, an editor who works minutes away at a publishing office on the business park, says she is “really encouraged to hear how safe it is and really happy to see this big investment in clean energy.”

The nuclear fusion reactor shares the park with a number of other businesses.

Tokamak Energy

When will nuclear fusion become a viable source of energy?

It’s a question that scientists have been asking themselves (and have been asked by journalists) for decades. “It’s difficult,” Tokamak Energy physicist Dr Hannah Willett says, while explaining that “[we] get a lot more energy out of this reaction than out of just burning fossil fuels.”

If successful, the experiment could see a constellation of tiny suns created on Earth. Fusion energy would be a major pathway in the green transition - alongside natural sources like solar, wind and tidal. The hydrogen can be derived from seawater, meaning we have a virtually limitless supply of fuel.

Scientists have been trying to make fusion work for more than 50 years and it could still be a while before we can effectively power our homes using it.

Once fusion power is achieved, the scalable technology could be rolled out across the world

Tokamak Energy

But as governments get more serious about renewable power - with the UK investing £10 million (€11.7 million) into Tokamak Energy last year, Kelsall’s “key” feels increasingly within reach.

Meanwhile five locations in Scotland and England have been shortlisted as the potential future home of the UK’s prototype fusion energy plant - the Spherical Tokamak for Energy Production (STEP) - with a decision due around the end of 2022.

Scientists hope the power station can be wired into the national electricity grid - eventually providing energy for people’s homes, and a template to be replicated around the world.

Is nuclear fusion finally for real? 

Some very rich people seem to think so.

James Pethokoukis, Columnist
December 3, 2021·

Fusion. Illustrated | iStock

America's first Atomic Age ended on March 28, 1979, with the partial meltdown of the Three Mile Island Unit 2 reactor, near Middletown, Pennsylvania. Despite the negligible radiation release, the accident led to canceled projects, industry bankruptcies, and a further public souring on nuclear energy. Nuclear's share of U.S. electricity production has been flat, around 20 percent, for decades.

But the dreams of the most optimistic nuclear proponents were always far bigger than an America dotted with fission reactors, where power is produced by the controlled splitting of uranium atoms. Eventually, fission would be replaced by fusion, the melding of hydrogen isotopes which produces more — much more — energy than it consumes. Then we would have energy's Holy Grail: pollution-free power produced using common (and therefore cheap) elements like hydrogen. No carbon emissions, no long-lived radioactive waste. All we have to do is solve one of the trickiest engineering problems in human history: recreating the sun here on Earth.

That project has been stalled by long years of technical frustration. But now, some of the world's richest people are betting the fusion problem might be solvable sooner rather than later. Earlier this week, Commonwealth Fusion Systems (CFS), a startup spun off from the Massachusetts Institute of Technology, said it had raised nearly $2 billion in private investment, including from mega-billionaires Bill Gates and George Soros. This is the biggest bet on fusion so far, even amid record funding for some two other dozen startups.

The CFS haul doubles the investor dough devoted to those firms, and that includes the previous record of $500 million invested early last month into Helion, a startup backed by well-known tech investors Sam Altman and Peter Thiel. As for CFS, CEO Bob Mumgaard said the new investment would allow it to demonstrate a net-energy fusion reactor by 2025 as well as begin work on the first commercial fusion power plant by the early 2030s.

Replacing dirty fossil fuels with clean power doesn't fully capture the potential of nuclear fusion. Clean, cheap, abundant energy could, for instance, help produce hydrogen for fuel, power giant machines to pull carbon dioxide from the atmosphere, and desalinate water on a large scale. No longer would concerns about energy and climate change limit our aspirations, even if they just involve energy-intensive Bitcoin mining.

And that's just here on Earth. While one could make an argument in favor of other emerging power sources — including advanced fission, enhanced geothermal, even space-based solar power — fusion would be especially helpful if humanity is going to become a space-faring civilization. As physicist Arthur Turrell, author of The Star Builders: Nuclear Fusion and the Race to Power the Planet, told me in a recent interview: "If you look at what realistic trips outside of our kind of solar system's backyard would have to be powered by — or even the Earth's backyard, I should say — fusion is one of the best candidates for that, because it packs a lot of energy into a very small amount of space."

Critics point to past hype cycles and failure, which is totally fair. But the level of private interest, in addition to recent technical advances, should give special reason for hope this time around. Hard-headed, results-oriented investors are sinking big money into the sector because they really think breakthroughs are imminent in a way they haven't been before. Maybe, a decade from now, the world's first $3 trillion company will be a fusion company rather than an online retailer or social media platform.

Moreover, this wouldn't be the first time a long-gestating energy technology suddenly burst on the scene and changed everything. The recent surge in gasoline prices has some politicians recalling the 1970s energy shocks. But there's a more recent example of an energy price spike, although many of us seem to have forgotten it.

A combination of strong demand and stagnant production caused an oil shock in 2007 and 2008, with oil prices hitting a record high of $145 a barrel on July 3, 2008. It was a great time for books and blogs about "peak oil" and how the world was running out of cheap fossil fuels. But then the global financial crisis crushed economies and demand while the "shale revolution" — the combo of hydraulic fracturing and horizontal drilling — simultaneously came into its own. The U.S. significantly increased domestic oil and natural gas production. We innovated our way out of peak oil.

But there are no guarantees fusion will follow that pattern. Sometimes the smart money gets it wrong. The artificial intelligence sector is famous for its boom and busts (also known as "AI winter") where interest soars and investor cash floods in — and then floods out again when the tech fails to deliver. Where are all the self-driving cars that were supposed to be on American roads by now?

The same could happen with fusion. Yet compared to the odds of humans dealing with climate change by consuming less and accepting a slower increase (or even a decline) in living standards, the chances for an Age of Fusion look pretty good.