Simon Irish is the CEO of Terrestrial Energy, a Canadian company that is developing a molten-salt reactor for commercial electricity generation. Irish explains why Terrestrial is seeking initial licensing in Canada instead of the U.S., why it may be another decade before his company can deploy its first commercial reactor, and why policy support for new nuclear reactors “needs to accelerate.”
Robert Bryce 0:04
Hi, everyone, welcome to the power hungry Podcast. I’m Robert Bryce. On this podcast, we talk about energy, power, innovation and politics. And I’m pleased to welcome Simon Irish. He is the CEO of Terrestrial Energy. Simon, welcome to the power hungry podcast.
Simon Irish 0:18
Thank you, Robert, good to see you. Thanks for having me.
Robert Bryce 0:21
Glad to have you. I didn’t warn you. But if you’ve listened to the podcast, I have guests introduce themselves. So I’ve given your title. But if you don’t mind, imagine you’ve arrived somewhere and you don’t know anyone. And they ask you who you are. Go.
Simon Irish 0:35
Well, thank you. So Simon, Iris chief, executive treasurer, energy I was educated in the UK. I read a science degree natural sciences at Cambridge University, spent 10 years in investment banking in London at a time when the big investment banks were looking for those with a quantitative education to run their complex financial models. I did that for 10 years and then moved to New York, and was in the asset management industry in New York for for 10 years before getting involved in the nuclear sector. A little bit by happenstance, happenstance, Robert, actually, but I formed crystal energy in 2013.
Robert Bryce 1:12
So you’ve been at this now for nine years, and I was looking back at my own records. And we talked in 2015. In fact, it’s almost exactly seven years ago was February of 2015. Now I’m going to as my brother used to say bust your chops right out of the gate here. We talked seven years ago, you expected that you were have your reactor deployed 2023 2024 Now, I’m not being I am being a little cheeky here. But tell me what you know, I know it’s very difficult to bring new technology to market and and we talked back then about why you domiciled terrestrial in Canada, Alaska, you the question directly. So what’s taking so long, and with all due respect, what’s taking so long?
Simon Irish 1:56
Well, if you were to deploy a reactor system, there are other counterparties that need to be ready to deploy that reactor system. So whilst we are to some extent in control of our timeline, you you’re you have to engage with regulators and you also have to engage with the customer and financial investors too. So there’s a natural pace that exists for the development of any innovation, any technology in any market. And we have spent the last seven years very much focused on the on the regulatory pathway engaged with private investors, and also engaged was probably probably the most important counterparty of the more engaged with the with the utility sector, those that are seeking to use this technology. So that’s what we’ve been up to for last last seven years, Robert.
Robert Bryce 2:42
And so tell me where you are in terms of the and I want to talk about the integrated molten salt reactor, which is your design. But tell me where have you built a prototype? Where are you in now? I mean, if you blue sky did and I’m, you know, again being cheeky off the bat here, but yes, you blue sky did from now then? What’s your best case in commercial deployment? Where from where where we stand now and in early 22?
Simon Irish 3:05
Well, maybe the two first point in terms of what we’ve been doing for last seven years, and we’ve been very much focused on probably the most important piece of the commercialization equation. But advanced reactor system, that’s the regulatory piece, because without that you have nothing of commercial value. Sure you operate as a business, this technology operates in a very carefully regulated sector, and early regulation, engagement, and progress with that engagement is so critical for the commercialization of this technology. So since we spoke last, well, it doesn’t seem like seven years ago, but since we spoke last, we’ve been engaged with principally, we started with engagement with the Canadian Nuclear Safety Commission, as part of their vendor design review process. And we started that formally actually started the setting that up in late 2015 started that process in early 2016. We expect to complete that this year. So that’s been a we’re in our seventh year of engagement. And we expect to have completed the full vendor design review process with the continued safety commission by mid year, this year. So it’ll be that there’ll be nearly seven years of engagement. And that is so important to the commercialization of this system, because it says a couple of things. Firstly, it says where you are with engineering, you can’t take a reactor to a regulator. Regulators regulate nuclear power plants in Canada, they regulate nuclear activities. And it’s the activity of operating a nuclear power plant, which is being regulated. So for us to make that progress in Canada and we’re engaged with the USMLE as well. We have to be designing a nuclear power plant, which is the product you sell people talk a lot about reactors, but that’s not really the product that’s being sold the product is a nuclear power. And that’s going to be used for commercial gain with the, in the hands of the operator, the owner of the operator. So we’ve been, we’ll be completing the bend design review. We anticipate that will repeat that successfully. And we anticipate that in completing it successfully, we will have in effect, the green light to move forward commercially. And that green light is a green light for for those who are seeking to partner with us on the industrial side to move this forward at a greater pace with financial capital that obviously wants to benefit from the successful scenario that that green light employs. And also with customers, utilities, industrial users that are now seeking to use this technology in their businesses. And that regulatory green light is so important because it it frames the first uncertainty with the technology. Sure. And that uncertainty is how you can regulate it.
Robert Bryce 5:58
Right? So let me jump in here for a minute, because I’m very interested to talk to you now, because I just published a piece in Forbes about the NRCS rejection of Oh, close application and Oklo, you know, had an unusual design a small 1.5 megawatt reactor, and they were just poured out now they, you know, NRC said you can come back, but when we talk seven years ago, and I thought it was interesting that you chose to domicile terrestrial in Canada, because you felt that the Canadian regulatory regime was more flexible, I guess, would be the right word principles based rather than rules based. So walk us through that, because I think that now in particular, and in the United States, the I mean, this is, you know, I’m not an expert on the NRC. But I’ve watched it long enough to know that it’s this is one ray Rothrock has said there’s it’s an uncontrollable risk, you don’t know what this agency is going to do. So if you made a conscious decision to domicile in Canada and seek Canadian regulatory approval, rather than American Canadian regulatory approval first, why,
Simon Irish 7:02
but if you wind the clock back, this would be to the is the thought process that was going on in the early days of trust for energy in 2012. You know, we recognized that it was so important when raising private capital, and we’re focused on raising private capital to support nuclear innovation that’s been driven by an entrepreneurial private company. And we recognize that from a business plan perspective, it’s so important that you’re able to offer private capital, a regulatory pathway, which is sufficiently clear in cost and time.
Robert Bryce 7:34
So you couldn’t find that in the US?
Simon Irish 7:37
Well, the, the, the, at the, at the time in the US, we didn’t believe that that was competitive against the Canadian process. Now, a lot has changed in the last seven years. We you have a in certainly United States, there has been a lot of congressional interest on this problem. And the problem is a regulation pathway is clear and constant time because it’s that pathway that stimulates the formation of capital, public and private, behind these exciting new projects. But in terms of where we were in 2012, we have to deal with the hand that was dealt to us by circumstances beyond our control. And we recognize there were certain unique merits about the cleaning process. It was it was stepwise, so you didn’t have to step into it $100 million? It was it, you could step into it with phase one and phase two and unnecessary phase three. And obviously, as you stepped into it going through these capital gates, the commitment got larger and larger. But you did that because you’re you became increasingly comfortable with the results you’re getting. So it was a phased process, but it was also principles based and risk informed. And that means that that created a degree of technology, it the regulator was capable of being technology agnostic, because being principle based and risk informed what that meant it hadn’t the regulator had not written a rulebook on the safety requirement for that system. What it had, it had established a set of common principles that are that are common principles across many nuclear regulators that define generally accepted principles of nuclear safety today, and it was up to us to justify the DoD design during the design review process, met or exceeded those principles. And that was that that was very important for us because we’re looking to commercialize a Molten Salt Reactor generation force system and a different system in terms of technology that that had previously been pushed into, into the commercial realm. So that so so
Robert Bryce 9:49
if I can interrupt just for a moment, because I think this is key here in terms of this principles basis versus versus rules based? Yes, because in the nuclear Innovation Alliance, they did a report on on On on the NRC and permitting last year, new scale, which is a light water reactor company here in the US, they spent over half $1,000,000,000.10 years to get their permit or to get their light their reactor design approved at the NRC and 12,000 pages with their application was 12,000 pages. So I want I’m making that point, because so how many pages of documents did you have to submit to get where? Or how many have you submitted so far? And how much have you spent in in Canada to get where you are today?
Simon Irish 10:32
Well, I think that that 12,000 pages is more an articulation of if you are developing a nuclear power plant, you’re down to the system level, and you’re down to detail engineering at a system level, you know, how many pages of nuclear material of engineered material does does does that design effort cover? It’s I think 12,000 pages is probably at least 12,000 pages. I mean, the position we’re in the moment is that we have we have, we’ll be completing what’s called basic engineering, it’s not particularly basic, but it covers all the systems associated with the operation of your power plant. And I’d say we are probably in excess of 12,000 pages ourselves probably a lot stiffening excessive 12,000 pages, in terms of the engineering materials. So it just is that 12,000 pages is more reflection on how much detail you need to create on the performance and the requirements for your systems, such that you can go to a regulator and say this is how it works. Sure. So, you know, we’ve pretty much close to 12,000 pages,
Robert Bryce 11:33
and so about how much have you spent in two questions? So how much have you raised overall, how much capital is terrestrial raised? And how much have you spent on the permitting side, which I’m guessing is really the bulk of bulk of your spending? Where are you on that?
Simon Irish 11:47
Well, you know, we have been supported by private capital philosophy formed the company, I prefer not to talk publicly about how much we’ve raised and how much we’ve spent, but nice as a day to say that there’s been sufficient capital raised to support a sophisticated engineering function that can take this design through the Canadian regulator and also engage increasingly with the US LLC. And so
Robert Bryce 12:11
I’m sorry to interrupt but it so you’re hoping that you get a Canadian approval first, and then you can go to the NRC or you suit as you’re looking at doing a dual dual approval process?
Simon Irish 12:22
Well, you know, each you know, each regulator is sovereign. So you can’t take a NRC approval and go to Belgium, for instance, you can’t take a CNSC approval and go to and go to the United States. And in terms of the event design review, it’s it’s an expressing a sophisticated opinion, on the safety case of the reactor system, the NRC. And this is to some extent, why it’s so it was so expensive for new scale, what they sought is what’s called a ruling, namely, this judgment by the NRC is binding in a future license application. So the NRC is binding itself at some future point in time, a license application submitted by utility. And it’s binding itself to a decision that it’s taken today, during the design certification process that’s being completed with with new scale. Okay, that is a much, much higher level of commitment for the regulator. The continued safety commission says we’re expressing an opinion, this is a sophisticated opinion. This is based on our careful review on all aspects of this design, submitted during this this event design review process that’s been going on for six or seven years. But if there’s a license application submitted for a license to operate this power plant, we’re entitled to to to not change your mind, but to alter our opinion and alter our requirements. So you’re not holding the regulator to to to a legal standard, which is the case of the NRC. The NRC has been held the factory to legal standard once the commissioners finally undertake their approval lawmaking actions on the design certification then you skill can go to a utility and say, this is now if you submit a you know, a license operating construct on a new scale power plant, in that submission, you can take this design certification, because it is it is it is a binding conclusion.
Robert Bryce 14:27
So it would it be fair to say that the Canadian process is more iterative, then you’re iterating then as you go along, and then you go back and say, well, here’s where we are now. And then they it’s not as hard and fast of a process, I guess. Would that be Oh, yes,
Simon Irish 14:41
it’s it’s some, you know, I’ve you see this and other aspects of regulation, not just Nuclear Regulation, in many aspects of regulation in knighted states and I have a perspective cross border perspective, is very much rules based in Canada and elsewhere in UK. The sort of a concept of precedent and common law, which creates a degree of flexibility, and also perhaps in, in some respects uncertainty, maybe a degree of a greater degree of commercial pragmatic pragmatism on behalf of both parties. And that’s, that’s that’s reflected in the way that the nuclear at this stage, the regulatory process in Canada is, is, you know, proceeds. Group pragmatism will express an opinion. It’ll be a thorough opinion, a detailed opinion, but it’s not a binding opinion. Okay. It’s not binding in licensing, and the NRC holds itself to a much higher standard, and says this is binding and licensing, but it misses something. Right? And it’s gonna be I I’m not, it’s gonna be awkward,
Robert Bryce 15:49
because Sure. So it’s just, I guess the way to define it is that the hurdle, the hurdle in the NRC process just higher, as you said, I was looking at my 2015. Yeah, just saying you thought you thought there was just too much uncertainty. But let’s talk a few numbers and to just get it back to the reactor design itself. So as what you said that you were looking to do your first plant in Canada, this was now seven years ago, tell me if this has changed. He said it would cost about a billion dollars in that you had three designs. One was 80 megawatts thermal, which would be used in remote locations, and then 300 megawatts thermal, again for industrial, and 600 megawatts thermal. So take a third off of each of those right for roughly to get the electrical output, right, something like that. Right. So 60 megawatts for remote? Is these still your your estimates, then are still your designs that you’re working on?
Simon Irish 16:38
Well, Robert, that that was at the stage where we had yet to start engineering and what was called the pre conceptual design stage, we were still forming our products. So last time I spoke to you was was was definitely some time ago. Yes, of course. So we took one product into the regulatory engagement with the, with the CNSC. And that’s because it the product is a PowerPoint and you have to try it what what your product is, right, and our product is a is a 400 megawatt thermal reactor that’s capable of net electrical generation of about 195 megawatt electric, okay? And the, the plunk format was a double unit. So you had to these things side by side, which creates a plot with nearly 400 megawatts, electrical,
Robert Bryce 17:32
AC, okay, I got my thermal to electrical conversions. And so it’s about half of you have your megawatt rating on thermal, then you cut that in half roughly, to get the electrical output.
Simon Irish 17:43
It’s about 44%, which is excellent, actually. And that is that is the great virtue of of our system and generation for systems that it’s really expensive base of industrial kit, equipment, which is so tight in it costly and time consuming to regulate. Once you’ve done that, you want it to generate as much kilowatt or many kilowatt hours as you possibly can. Sure, because, as always, you generate increases your revenues. So it also
Robert Bryce 18:15
so that 44% I’m sorry to interrupt but that 44% on the efficiency that you said that’s high, is it because your your your process, heat is higher, you have high and that means higher enthalpic efficiency, isn’t that the right word is that the is that the
Simon Irish 18:29
efficiency, this is another term that I think is relevant, but some the you know, the basic concept is high thermal efficiency. And that’s critically important for economics. It’s foundational with respect to the the economics of any any power plant coal or any machine actually, in our case, we can operate at 44% net ness of the parasitic global power plant, and that compares to 30% for a nuclear power plants of the same size, using water moderated water cooled technology. So you go from 30% to 44%. That is an immense improvement in the industrial economics of nuclear power generation. mean that’s why we’re doing this gotcha that that 30 to 44% gain.
Robert Bryce 19:22
So walk us through then the integrated molten salt reactor as I recall, you said this was a design that was developed in the US in the 80s. And then now you’ve revived it tell me, tell me why it’s it walk us through if you don’t mind? I’m passingly familiar with these reactor designs, but there are a bunch of gets complicated. Why is this better? What are the attributes of The IMSR relative to others?
Simon Irish 19:45
Okay, so this is what’s called the generation this is part of a class called Generation for generation four. They’re defined by international treaty from 2001. The US was a founding signatory along with Canada as well actually Ray. And these these are very these are fission reactor technologies that are very different compared to the technologies that have been used commercially. The past, you know, 6070 years,
Robert Bryce 20:12
the light, the light watered react, yes, the
Simon Irish 20:15
light water, water cooled water moderated technology, they were identified by this inter governmental working group as the type of technologies that offered a, a a pathway forward for the nuclear industry, a pathway defined by better economics, better fuel use, better performance, better waste profiles, etc. Basically, the future of nuclear status a technology perspective, yes. Now, now we’re using one o’clock, a molten salt reactor, which is one of those six technologies that were identified in 2001. And we’re using it because we think, you know, our ambition as a company, our purpose is to design a nuclear power plant with a set of technology and design choices to to achieve a superior economic performance. We’re not doing this because we like molten salt reactors. We’re doing this because we believe that our technology and design choices achieves a solution, which is a very valuable solution to deliver to competitive energy markets. We think the problem today with with for many decades, actually with nuclear power, has been cost
Robert Bryce 21:29
Sure, to expand and delay to get to market right and construction time. I mean, this is clearly playing out with plant Vogel, I mean, and played out with the summer plan, I mean, just took forever.
Simon Irish 21:41
Yes, and this is a, you know, that problem is, is a problem of complexity of robots. And complexity has a cost dimension to it, as well as a time dimension to it. It certainly has a very negative impact on economics, and the incentives for those that you want to spend their hard earned dollar to adopt new nuclear, it’s a negative incentive, because it’s too costly, too risky, too complex. And the the financing is, is requires a sovereign balance sheet, you have a technology today, that requires a sovereign balance sheet to be deployed in, in competitive energy markets.
Robert Bryce 22:18
So I’m sorry, what I like that I like that phrase. But if you don’t mind it, what do you mean by a sovereign balance sheet, tell me
Simon Irish 22:24
what you need. And it may be that the the project itself, the infrastructure project itself, is so complicated, and complex and so large, that it can’t be financed by by by private capital, using any ordinary method, it can only really be financed by governments have, you know, an extremely low cost of capital. And that cost of capital is essential if the project is going to take 10 to 12 years to commission and bring online and start generating revenues. So the incumbent technologies today require that the track record is there sold by governments to governments? Right, that’s not a particularly legitimate position for a for commercial technology. I mean, if it’s if it can only be sold by governments to governments, it’s going to play a very limited role in global energy markets. That’s the problem to solve. And we’re solving it with the generation four reactor system. And Robert, the reason we believe we can solve it is going back to that first foundational statement I made is that our machine operates 50% more efficiently than the incumbent machine. So just off the bat, your machine commercially is earning 50% more revenues.
Robert Bryce 23:44
Well, so let’s let’s talk about them that so that that issue then. So that higher efficiency, is that because you’re you’re processing the process heat the design itself produces higher temperature steam, is that part of the reason why you’re getting higher efficiency?
Simon Irish 23:59
Yes, I mean, this is just this is just basic thermodynamics right, using a molten salt, a molten salt is thermally much more stable than water, right. So, what you can do because that high thermal stability, superior thermal stability, you can operate your machine at a much higher temperature.
Robert Bryce 24:19
So what is that and what is that temperature in all cases
Simon Irish 24:21
it’s 700 degrees centigrade, the the reactor itself is operated at 700 Water moderated water cooled system. Conventional technology probably can’t get beyond 300. So your steam supply, in our case, it consists of a very own a high temperature steam, in fact, the state virtually the same steam supply you see in a coal plot, about 585 degrees C and 18, mega Pascal’s and pressure that that’s standard industrial steam, and that to drive a standard industrial turbine. And that’s that means we can operate at pretty much the same thermal efficiency as a fossil fuel plant. ultra, ultra,
Robert Bryce 25:07
ultra supercritical, I guess would be that right? So then what? Tell me the the cost then so we’ve talked around. So we’ve got the design, you’ve explained the design on Molten Salt. I want to come back to that, but I just this question. So give me the number. So then you’re talking about a 400 megawatt thermal 195 megawatt electric? what’s your what’s your cost to build? What are your What are your estimates then to get this deployed on a on a per kilowatt basis or plant basis?
Simon Irish 25:34
Okay, so you know, per units, it’s going to be, it’s going to be less sniffily, less than a billion dollars. The double units, you know, one and a half billion, something like that.
Robert Bryce 25:45
So 1 billion for 200 megawatts electric,
Simon Irish 25:49
significantly under a billion dollars. Okay, significantly under
Robert Bryce 25:52
but so we’re less less, less less than a billion for 200 megawatts, but so you’re still but you’re still competing with your natural
Simon Irish 26:05
amount, everyone’s okay with it on a pure cost basis, it’s, we think we can do better than $3 a watt instant overnight cost. Now, now we’re going up because I could see you backwards.
Robert Bryce 26:17
Okay, so $3 per watt. So compared to gas fired turbans, maybe $1 A watt, depending on where you’re building them. Right. But that’s but your fuel costs are going to be less. Yes. So then the other that’s the other part of the equation.
Simon Irish 26:30
Yes, I mean, you’ll never compete on capital against natural gas. But in terms of the price of power, that’s the is that that’s this the levelized cost over the entire life of plant, natural gas as a spirit. 70% is fuel cost. 30% is capital. And nuclear, it’s probably the other way around. It’s 70% is capital 30%. is operating and fuel. So maybe at 20. So you won’t be natural gas on capital. But you’ll definitely be sets once you build it. It will be set on an operating cost basis.
Robert Bryce 27:04
Sure. Yeah. And so then what and what do you think then on a per megawatt hour, what’s your number then you think you can operate?
Simon Irish 27:11
We think this technology is capable of delivering electric power at five cents a kilowatt hour $50 A megawatt zone? And that’s, that’s before any incorporate any subsidy that you may get from a cotton abatements, government, a Cabinet meeting credits? Sure. And for me, if you just use it as a thermal plant, and I think Robert, this becomes quite interesting. Now, when you’re looking at what’s happening in the natural gas market after 10 years, we think this can dispatch thermal power at about $6 and MMBtu.
Robert Bryce 27:44
Hmm, okay. So just for district heating, or for industrial process heat or or those those those applications,
Simon Irish 27:52
well, if district heating is for sort of low grade heat, that’s not particularly exciting, because it’s low grade heat. That’s, that’s, that’s leftover from industrial processes. But all heat is high grade heat. And that has that has relevance, a lot of chemical, petrochemical chemical processes relevant to green hydrogen production, green ammonia production. And if you have green hydrogen, you have the ability to make high quality Steel’s, that are green, the CMA, Brent is virtually but she removed from it. So that’s the opportunity that you have with this, this sort of this this double product, high grade thermal energy, and cost competitive electric power, both of which is cost competitive, and also near zero co2 emission. Sure.
Robert Bryce 28:40
So blue sky now and you know, I was cheeky to begin, you know, in talking about where we talked about seven years ago, but now we’re here in 2022. Give me the blue sky estimate. Now, when do you think that you can get commercial deployment now based on where you are in your development and all the work you put in? And you, you know, where you’ve refined the design, and now have one design that you’re going forward? With? What what tell me, you know, blue sky, when will you get this out and producing juice?
Simon Irish 29:08
Well, the we think we commissioned the first plant within a decade, that’s going to be by December 2031. Now, that timeframe reflects the readiness of two other counterparties. Robert and I mentioned this at the beginning of our talk today, the readiness of the regulator, and the readiness of the of the utility. If both of those are ready today, ready to go today. And you may be able to cut a corner on a site that’s got no site permit, you may be able to also reduce that a couple of years as well to maybe 2028 2029. But without if you take that away, because you think that’s a bit too generous in terms of timeline. You know, let’s say we’re not going to deploy it on one of the few sites that has an early site permit. What is the timeframe? Dealing with and will generalize case. We think we could deploy this within within 10 years. And I make that statement with respect to to the United States, to Canada, and the UK and perhaps other markets as well.
Robert Bryce 30:13
And are those the markets that you’re targeting? First, I would assume Canada would be your first market? Because there were, that’s where you would get your regulatory approval you have need for high high end mining and remote mining locations in Canada. would those be your first candidates, then where’s your logical first deployment?
Simon Irish 30:30
Well, we’re increasingly moving forwards on, on on all three markets at the same time. Now we focus when we
Robert Bryce 30:38
move on UK, US and Canada. Yes, exactly. Yes.
Simon Irish 30:41
And that reflects, I think the, you know, the policy dimensions and all those in those markets is really quite, it’s very supportive for this type of technology. You’re in Canada, I think there’s there’s, there’s a, perhaps a greater opportunity to deploy the system to support green hydrogen production, and also to support the title type of industrial activities that are that have a very, very high energy load thermal and electrical energy load in Alberta. I mean, that’s that’s a that’s that’s a, a province in Canada with some substantial industrial activities that costs a lot of energy.
Robert Bryce 31:19
Oil, tar sands, production, mining, etc. Yes,
Simon Irish 31:21
exactly. And that’s true for United States as well, we are, we are particularly interested in green hydrogen, because Robert, this technology, with this sort of this double product of thermal energy and electrical power at near zero carbon, that double energy products, nuclear energy products, is enables, we believe, the most cost competitive methods to create hydrogen.
Robert Bryce 31:48
So I see in looking at your thanks. I’m a skeptic on hydrogen. But well, that’s a whole nother discussion. We’ll leave that leave that alone for now. But you have a you have a pretty solid group of advisors and your your corporate Industrial Advisory Board and looking at this Arizona public service, Bruce Power, which of course is the owner of Bruce nuclear station in Canada, which is the largest operating nuclear plant in North America. You got Dominion energy, Duke Energy Northwest next year on GE, Ontario Power Generation. I mean, you got a lot of potential customers right there. And then your advisory board, Ernie Monese, you got a whole bunch of heavyweights on there. If you haven’t had trouble, it appears you’ve had success, convincing people that you’ve got the right technology. But you got to have patient capital as well. And I’m assuming you have that you don’t want to talk about how much money you’ve raised, but you must have patient capital behind you to keep going this long. Right? Well, you’re still still a decade away.
Simon Irish 32:46
Yeah. I mean, Robert, from a capital perspective, you know, capital wants to see see a return on capital is, is the the point of actually commissioned the first plant is not particularly relevant from a revenue perspective. Nuclear power? I’m
Robert Bryce 33:01
sorry, I’m sorry, one. Yeah, that’s an interesting statement I haven’t had. Why is that
Simon Irish 33:06
because nuclear power plants is a soul then builds not built and sold. So it’s the vendor, we’re selling the power plant, we’re not financing it, the customer finances it, right. So in that respect, you start providing services, profitable services, as soon as you secure that first contract with the first utility.
Robert Bryce 33:30
I see. So there’s going to be that is there going to be the design right out of day
Simon Irish 33:34
that paying you for site Pacific engineering, which is required for the first what is required, so you can design your product for their site. So they’ll that that is a service, you’re going to provide the utility or the industrial customer. And in terms of providing that service, we and others in the industry, you know, kicked off that process. We aren’t revenues doing that last year, and and they started the year before. So that’s, that’s the path we’re on. In terms of developing our business, developing and growing revenues, and the revenue pieces is the bit that’s important for any business. So and
Robert Bryce 34:12
you said, and you said, you’re already you’re already making revenue, you said some of your customers are paying you know,
Simon Irish 34:17
we’ve we’ve engaged with utilities, one in particular, actually, Ontario Power Generation, for site Pacific engineering, as part of their process to to determine how how our design could fit into their needs and their site. So that’s, that’s a service that we’re providing to a utility and it’s a type of service that will provide to to any other utility or industrial user that is seeking to take this technology and use it for commercial gain at a location that add a site that they that they own gotchas, the commercial process we’re on.
Robert Bryce 34:54
And then the I want to go back I didn’t let you finish On the molten salt reactor design, and that that the salt being the, the, the the thermal carrier for the reactor. And then so explain that what that mix is, if you don’t mind what is in that salt mix that’s being circulated into the reactor and then into the into the powerhouse.
Simon Irish 35:18
Well, the molten salt and the chemical form of it is pretty ubiquitous, it’s a pretty standard, you know, industrial industrial salt, but that in that salt, you actually put uranium fluoride or uranium salt, right, and when you heat it up, it looks like it affected looks like water, it’s got a slight bluish green glow to it, but it’s it’s just translucent, completely clear. Now the the virtue of that, from a safety perspective is that there’s a cost dimension to it as well and economic perspective is that you can operate hot. But you also from a safety perspective, you have a mechanism which is extraordinary in its capacity to dissipate heat, fluids, particularly thermally, stable fluids move heat around and dissipate heat naturally, by convection, you can’t turn it off, you can’t. There’s no fan belt there to break. It’s it’s a it’s a inherent behavior of the system, which is a law of nature. So no fluids, IV fluids convect. And that’s important with respect to removing that intense heat of the fission process. Nuclear energy is associated with the with an intense amount of energy being created. It’s characteristic where the fission fusion, and what you want is a system that is capable of dissipating that heat under operating conditions, next acts of an accident conditions as well, always dissipating that heat, where you have a cooling system that’s always on. And the virtue of a molten salt is that if you create conditions where you fission, that uranium in this thermally, super thermally, stable fluid, that that heat will naturally and always be dissipated, you know, within the reactor vessel. And you can’t turn that that cooling system off. It’s a natural property of the system itself. So virtually you have a Molten Salt Reactors, not only because you’ve got a thermally stable coolant, but also you’ve got a liquid fuel is that you can incorporate into your design, these very important characteristics of inherent and passive safety. And those two characteristics inherent and passive safety. They’re not just super important for economics, because it simplifies your engineering efforts, and your engineering challenge. But it’s also super important social license as well. And that is that is part of the attraction of using the Molten Salt Reactor as we we pursue our mission as a company to to to, to transform the cost the price of nuclear power generation.
Robert Bryce 38:00
I’m glad you brought that that term up the social licence because that’s one of the issues and one of the key hurdles is I’ve written been writing and talking about natural gas and nuclear energy for you know, now more than a decade and saying if we’re serious about co2 emissions, we have to be serious about nuclear. But the big hurdle, it seems to me is that social licence, and that, that education of the public to say no, we’re different. So walk me through that. I mean, if you were on television, or you, you know, or just give me the pitch, then if you’re talking to a lay audience, a general audience, tell me, you’ve given me the the technical part of this, but I sell, right, but sell me on this, that, no, we’re different. And we’re and you’re gonna like it because of why what what what is the, what’s the pitch you’re going to make? That is the one that’s going to make people’s change people’s minds that gives you that social licence to operate?
Simon Irish 38:54
Well, the social licence when we formed the company in 2013, Robert was really important, but we’ve moved so far on the social licence point. I don’t think social licence is a is a major impediment for nuclear innovation in, in, in Europe and the UK? Well, I I’ll just say, UK, leave your pound because it’s a patchwork of different years.
Robert Bryce 39:16
It’s, it’s complicated. It’s complicated. Yes.
Simon Irish 39:18
And certainly in terms of social licence in Canada and the United States, you know, nuclear is now viewed by anyone who is wants to hold a credible position in their commentary of the energy challenges facing us. And nuclear is viewed as an essential part of our energy mix. So I the social licence exists, it’s been expressed with a very impressive trendline and in nuclear supportive nuclear policy in Canada, United States in the UK. In some jurisdictions, it’s still a problem. For example, Japan, given their recent experiences, social licence for new credit, I think social licence for conventional Nuclear water, cold water moderated boiling water axes. You know, that type of stuff is still very, you know, politically, very awkward. But social licence, particularly local social licence about around a nuclear power plant, Robert, it’s those local communities who understand the technology that are very supportive, probably with some of the most supportive communities for nuclear power. And if you look at polls that have been published recently, then you see a very healthy movement towards an increasingly supportive attitude amongst the man in the street in the public square, and towards nuclear energy. It’s one of the points that I it’s quite an interesting point is I think, for some people, the social licence question, it sits in what I refer to as this paradox, I call it the neighbor problem. And the neighbor problem is you have a pollster who’s going down the street asking people what they think, and he knocks on number 10, of whatever street door opens, he has a chance the guy opens the door. And he says, What do you think of nuclear? And he says, Well, you know, I love it. I really do. Fantastic. That’s what we need to move forward with a sort of prosperous, you know, into a prosperous energy future. The problem is my neighbor, he doesn’t like it. So the pollster pollster goes to number 11, whatever streets, knocks on the door, and the door opens the guy and he asked the same question. He said, he goes, What do you think nuclear? And the pulse goes, watch the nuclear and the chapter opens the door goes, well, I love it. It’s our future. We must get on with it. But the problem is my neighbor. And so I think that’s the social licence paradox, frankly, the nuclear today.
Robert Bryce 41:48
Well, I think it’s interesting what you said there about the issue of the that the social licence for Light Water Reactors has been revoked. I’m not I’m putting words in your mouth here. But because you have a new chemistry, you have a new story. And therefore you have a different a different social license, you have a different the chemistry you have gives you a different story, which gives you a different profile in terms of the social license is that is that is that you
Simon Irish 42:14
have economic legitimacy, I think the way to put it, Robert II can have economic legitimate legitimacy, you have a nuclear power plants and technology that can be supported through the ordinary means of industrial development, and construction and operation. And it doesn’t need doesn’t need to be pushed out into markets by government mandate, because the the the technology is so marginal, in terms of its economic capability that it could not be supported, without without massive government support. So what do you have with nuclear innovation? In terms of social licence, I think you have economic legitimacy. And that’s what we think we can deliver with our with our IMSR.
Robert Bryce 42:58
So the economic legitimacy comes from your ability to finance this without with private capital without having to have the government pushing this so you don’t need the government of Abu Dhabi to hire the South Koreans to build the albaraka plant, you could do it.
Simon Irish 43:15
And the government of Abu Dhabi, I’m sure they’ve got the cheapest source of cost of capital in the world that the highest quality credits, right. So they are exceptional in the investment world. And so, you know, obviously, that project looks very different to them, compared to an industrial that that doesn’t have that we’re
Robert Bryce 43:33
pet analysis Electric Cooperative here in Texas or some other one that’s going to be so then tell me about the US. Canada, you have a you have a footprint in both markets. Yes. Just looking at your website, and you have one office in North Carolina, and then you’re in Ontario, I forgotten what bits you’re outside of Toronto, right.
Simon Irish 43:51
It piston apples. Yes.
Robert Bryce 43:53
So. So tell me why that you need it. You need both. You need a foot in both markets. But I didn’t quite follow how you’re pursuing the licensing initially in Canada, but you’re also talking to the NRC. What? What’s it tell me what you’re doing with the NRC relative to what you’re doing with the CNSC?
Simon Irish 44:13
Well, we started with the with the Canadian Nuclear Safety Commission, right. And a couple of years later, we started pre license application discussions with us NRC. And it was that was in very much in our interest because we’re seeking to deploy the system as quickly as we possibly can in the United States. Rule number one, as you go down that Commercial Road is early regulatory interaction, the regulator has to be prepared, has to understand has to before that application way before that application arrives. It’s in your interest to ensure that the regulator is prepared for that application understands the technology and part of that process is associated with the submission of white papers, topical reports. There’s all manner of activities that can be undertaken. As you work with the regulator in well in advance of submitting that important license application. Our engagement with the NRC has been leveraged, I’d say, by a initiative undertaken by both agencies in summer 2018, where both agencies sought to collaborate,
Robert Bryce 45:29
and CCIC CNSC
Simon Irish 45:33
sought to collaborate on the methods, practices, frameworks, methods and methodologies to efficiently efficiently license these new reactor systems, these generation for advanced reactor systems. So the NRC has a strong interest in getting prepared. It’s getting prepared because it’s working with other regulators, not just the CNSC. But it’s working with the CNSC. And we’re engaged with the CNSC in Canada, in an advanced way. So it allowed us to engage with the US NRC to leverage our activities in Canada. And there was very much a mutual self interest there. I mean, we were very pleased to support that initiative. Because we saw it in our interest to that the NRC was was moving forward as quickly as possible in getting prepared for that future license application that we’ve we’ve we’ve started that strategy, that planning strategy already.
Robert Bryce 46:31
And so when do you think you would then make a formal application to the NRC? What would you get to get an opinion from the CNSC? First, would you wait for that before you go to the NRC? Or would you do it on a Duke?
Simon Irish 46:45
I think we want to get that, you know, that green commercial green lights? You know, the CNSC has been looking at this power plant design for a it’s in the seventh year. We want that commercial green, nice in the summer. And that point, we will, we will be this
Robert Bryce 47:00
this this summer. This year, you’re hoping to get it that after seven years that you would get that green light is the term of art is an opinion from the CNSC, then is that the
Simon Irish 47:10
well it’s a completed Venn design review, where at which point they express a very detailed opinion on the license ability of this power plot.
Robert Bryce 47:17
And I’m sorry, just use Venn design,
Simon Irish 47:21
vendor design, render design, right. Okay. Yes. I’m
Robert Bryce 47:23
just wanting to make sure it’s,
Simon Irish 47:24
they’re facing off as the vendor. Right. Yeah. To the regulator. We’re not facing off as the license applicants. That’s going to be the utility. Right, we’ll be seeking a license to construct and operate.
Robert Bryce 47:39
Sure, which is a separate a separate issue from what you’re seeing his agenda, right. But that term of art is the completed vendor design, review, review. Right. Okay. Yeah. Okay. And so you want to get that by this summer. And then you’d go to the NRC and say, hey, look, well,
Simon Irish 47:55
at that point, you know, we would be seeking to submit and this is public record, actually, although it’s not necessarily that easy to find on the NRC website. But we are seeking to apply for a standard design approval of the most innovative element of our of our powerplant design. And that is what’s called the integral molten salt reactor core unit. That is where the innovation sits, the Molten Salt Reactor sits itself. So that’s the next stage of our engagement with with the NRC. It’s a standard design approval for a substantial portion of the power plant. And that’s the the innovative piece, the Molten Salt Reactor piece at the heart of that power plant. The reason we’ve done that, Robert, is because what’s exciting about our design is, on the one hand, what’s new, and what’s different and why that’s exciting. But it’s also what’s interesting about our power plant design, is what’s not new, and what’s not different. So we’ve been laser focused in, in selecting innovation that achieves our purpose. And if innovation does not achieve that purpose, we stick with conventional processes, components, methods, practices. So we are licensing strategy, regulatory strategy, the United States is to focus on the novel piece, because we don’t believe that the standard piece represents a unusual set of regulatory uncertainties.
Robert Bryce 49:26
You want to show them you want to show things that they’re familiar with and then so
Simon Irish 49:31
at a later stage, you’ll come back to that to this piece and say, Look, you know, this is just standard in the industry. And we will we’ll submit that piece later. But the, the the novel piece, which is the the reactor itself, will submit that and that’s the that’s gonna be the first step of our formal engagement, licensing engagement with it with the US, US NRC. And just on this point, Robert, about making being very careful about where you innovate because nuclear innovation comes at a cost financial cost, time cost be very focused and clear as to why you’re doing it. Okay, so we’re doing it for for for, you know, economic for economic gain. But you know, case in point is that our system uses standard nuclear fuel. Right? Because that’s understood. So low enriched uranium, well, it will say standard assay, low enriched uranium, okay, which is the the standard industrial material that’s used in civilian power plants across the world today, and there’s an industrial complex, being big, very expensive industrial complex that’s been put in place to enrich mine enrich, manufacture, supply, transport, that material to countries operating civilian nuclear power plants, we want to in in deploying our system in commercial markets, we want that system to be able to inherit that supply chain capability. So we’re using standard sa learn your geranium equipment that’s
Robert Bryce 51:06
in that supply chain as you can depend on that in Canada, right, where you are right, you don’t need to go outside of Canada
Simon Irish 51:12
to vote we Yeah, I mean, kind of doesn’t use it enriched enrich fuel, it’s it’s it’s quite unique, its uses. Okay, but if you go to the we go to the Europe, United Kingdom, France and the United States for standard assay, low enriched uranium, sure, as the as the as the fuel for our, for our active system. So that’s, that’s how we were going to source fuel. But source but fuel is, unless you can point to a secure and reliable long term supply of nuclear fuel, it’s gonna be very difficult to find utility that’s going to commit a lot of capital to operate it where the investment case is based on reliable operating operation for at least 3040 50 years. I mean, you have to in terms of that duration, you have to get all other aspects of the project to match that certainty to including fuel supply. So we talked about pregnancies and actually,
Robert Bryce 52:08
sure, well, I think that that’s an interesting, that’s a key word here, right, is that certainty issue that, you know, you’ve been dealing with these uncertainties in terms of licensing, and as I mentioned, Ray Rothrock, earlier talking about this uncontrollable risk around the regulatory part of this that, you know, I think they’re I’m very hopeful for terrestrial and a lot of these other companies, but it’s just the, the uncertainty in this getting from the concept and the paper reactor to the commercialization. It’s just been, I mean, you know, companies fail left and right, and that what is the technology valley of death? But let me ask a specific question. So what’s your headcount, then at terrestrial? How many people do you have on payroll?
Simon Irish 52:47
We have a team at the moment we’ve been we’ve been the project for about about 120 this day,
Robert Bryce 52:52
and who are your biggest competitors? Then I know that there was a Bruce Power forgive me for not looking this up there. Right before we got online here. But there was a competition, was it Ontario Power Generation or to select a new reactor? But you were in the running there? And I’m not. But you weren’t you weren’t selected? Right? Was that a big blow? Who was selected? who and who are your biggest competitors?
Simon Irish 53:17
Well, the I think you’re referring to the OPG down selection. And that got a lot of international attention. There you go. Thanks. So Ontario Power Generation. For the last three years had a program it’s just been concluded how to program to select a small modular reactor, right technology to deploy at its deployment ready site at Darlington. And they had started the process with a you know wide catchment, pretty much every SMR technology available on the market. And through a sequence of down selections, they got back, they got down to three in the summer of 2020. So for the for that 18 month period from summer 2020. The end of last year, they worked intensely with three developers of eSmart power plants, those three were ourselves Do you Tachi and X energy to generation for one, generation three, their objective was to, to to the great extent, they could have a project where you’re delivering one of these power plants in 2028. That was a very important objective. And they made their decision at the end of the at the end of this year. And for power generation only two, supply a to get move forward with the next phase of their project with G Itachi. And that’s a small boiling water reactor. So they were strongly attracted to 5050 years of operating experiences with boiling water reactors and that recently, the certainty that they required in pursuit of that at that 2028 A goal so we didn’t move forward with with Ontario Power Generation, but the market for these techniques Robert is immense, particularly generation four technologies, where the market for clean heat, thermal energy and electrical power generation is, is, is extensive. It’s not just one utility in one province in Canada, it’s many utilities are many industrials across many, many advanced industrial economies. And that’s, that has always been our marketplace. So we’re moving forward with, with other other relationships. And we want to be focusing more on the thermal energy, as well as the exact pieces unique to the generation four, the generation four, technology class, the generation three technologies can’t compete, they don’t have the technical capability of delivering high quality heat. So we want to be moving forward with the high quality thermal energy message that’s very relevant to chemical production, petrochemical production, supporting natural resource extraction. benification, even still refining as well. So that’s that’s the lane that we’re increasingly focused on at this point in time.
Robert Bryce 56:09
Sure. And that GE is so well, then is it fair to say then, since you were in there running directly with them x energy and GE Hitachi? I mean, you know, those would be the ones that are your your biggest competitors. Now, are you what you’ve got? I mean, yes, it’s a crowded field, and also kind of not crowded, too. I mean, so who do you Who do you are these competitors?
Simon Irish 56:33
Well, in certainly, in terms of that procurement, yes, we’re competing in that sort of that that small playing field in southern Ontario, right, last 18 months, we’re competing with GE, Itachi and X energy, but the there’s a much, much bigger playing field here. Sure. And the the, it’s supplying clean, cost competitive energy to many industrial users, across many industries, and that is a really textured patchwork of different users wanting energy for different purposes. And this idea that this is somehow internet search, where, you know, the winner picks up everything, it’s that’s just not the way the energy market works. So we’re focused on on what we think are, are particularly interesting points for us, in particular areas. And that’s, that’s that saw strategy moving forward.
Robert Bryce 57:28
Sure. Let’s talk about China for a minute. And we’ve been talking for about an hour. And again, my guest is Simon Irish. He’s the CEO of Terrestrial Energy, you can learn more about them at terrestrial energy.com. The piece I wrote recently for Forbes about the Oklo, being the application being rejected by the NRC, to me it was just that there were a lot of things that were interesting about it. But the other one of the key things was that just a few weeks before that relicense was rejected, the Chinese began operating a high temperature gas reactor in Shandong Province, or the Chinese just miles ahead of us, and if so why?
Simon Irish 58:04
Well, the Chinese are have got a horse in every technology race. So they’ve got to say, we’re not going to decide which is going to be the commercial winner, we’re going to do everything. And that’s in the high temperature gas reactors side. That’s what they’ve done, they’ve turned, they’ve turned a high temperature gas reactor on. And that’s that there was announcement, I think, before the end of year on that, it was interesting for them, because they’re obviously very pleased with that, with that, that engineering effort. But they also did recognize and did comment that, you know, commercially, this doesn’t look too exciting, because the technology is demonstrating that that is characteristics, economic characteristics, put in a box where it’s gonna be more expensive than conventional technology. So it’s not particularly clear what the commercial value of that project is. But they’ve got a prototype commercial plant. And the West has had prototype commercial parts at the same character, high temperature gas reactors, and they haven’t been particularly commercially successful either. So but But China is committed, they’re not trying to pick and this is, this is if you want to compete with China, you have to recognize that it’s gone a horse in every race, despite its clear engineering and technological sophistication on the nuclear front. And it’s it’s determined policy as well, no political ambition is not trying to pick pick a technology that’s the winner. It says, you know, we’re going to have we’re going to invest in nuclear innovation across every they’ve got a Molten Salt Reactor being developed as well across all these lanes. And that is how we are going to guarantee our future superiority not just in our regional market, but presumably they’ve got aspirations for global superiority of Chinese technology in the advanced reactor space. They’re not they’re not picking a winner. And in terms of innovation, I think it’s very, very important from a policy perspective that that’s for the policy makers. Don’t try and pick winners and take it upon themselves, the role that’s usually left to private markets to select the winner. The history of nuclear innovation today, in the West anyway, is not a particularly attractive one. When you look at the the efficiency of the process of nuclear innovation, it has not been left the markets to decide well is now because the incumbents are large again, going going bankrupt. So the market involvement in the west today is to hold up the stop sign, which is a stop sign associated with with with bankruptcy of those pursuing incumbent technologies.
Robert Bryce 1:00:53
But you’re talking, you’re talking you’re talking about Westinghouse,
Simon Irish 1:00:57
yes, but the go sign, which is the go to private capital that go to private industry, policy has to put themselves in a situation where they’re holding the go sign up. Now, China is not too worried about that Greenco sign because it’s it’s its policies to invest in every single, every single system.
Robert Bryce 1:01:17
But But that’s, But therein lies the key as well. So I like the way you described that but they’re building 46 reactors so that Bloomberg Latest reports, 40 40x reactors, and they wake up cool. It’s just they’re stealing a march on the US and Canada on I mean, the rest of the world, they’re now they’re burning a hell of a lot of coal to their record consumption of coal. But the the Chinese are building 46 We’re building to their that plant Vogel, they’re over budget over over cost. And the Russians have deployed the power ship and Pivec in Siberia? I mean, they’re, they’re forging ahead. But is that because of I mean, going back to your idea about the sovereign balance sheet, is it is that a direct result of the fact that the government is so much has a direct role in the development and deployment of nuclear in those two countries? Is that the main difference?
Simon Irish 1:02:10
Well, they have a direct role in the innovation of any industrial sector, and it’s particularly pertinent in nuclear, it’s very clear that direct role in supporting innovation in wind and solar had profound consequence with the speed at which you got innovation in that sector going back 15 years. Now, what the argument is said to what you got from all that, that you know, that that’s that that policy today, but it’s undoubtable irrefutable today that that policy commitments held up a massive green sign to private capital and private industry to get going and and, and create capital to, to innovation that sector, that’s undeniable.
Robert Bryce 1:02:53
Just to be clear, you’re talking about wind and solar, they had that the government stamp of approval. So yes, go ahead. And okay, go ahead.
Simon Irish 1:02:59
And it was it was real policy support, which had a an effect on on capital formation around innovative projects in that space, that green go sign was there and it had an impact, we need that green go to go sign. Because the nuclear industry today consists of two lanes, it has a lane associated with those that are seeking once more to continue with the commercialization of incumbent technology. And you’ve also got a new lane that’s been created. And this lane is the young entrepreneurial growth company that thinks that it with a very, very focused business plan can do so much better with respect to design and technology choices and create a much, much better product. Okay, that is the grassroots of nuclear innovation today, and its policy needs to support innovation at those grass roots. So that’s the I think that’s the that’s the important dimension, intersection between what’s happening in the private in the private side and what’s happening on the policy side. Governments have gone a long way to support this in terms of grant funding and grant activities. So there is there is no policy support, but it needs to accelerate. And it needs to have the same outcomes as we saw with wind and solar 15 years ago. Right. I mean, that was a big green sign go sign. One other points as well. Robert, rather long link the answer to your short question, but then is that nuclear is because it is so heavily regulated for good social reason, that first plants requires a much greater degree of financial support. So you have this paradox, that the first part requires government support because of its uncertainties because of regulation. second, third, and fourth and fifth, can never happen without the first but the trouble is the second, third, fourth, and fifth will only happen if private sector if it if it’s meaningful, the private capital. So you have this risk that you create stranded technologies, where and
Robert Bryce 1:05:18
the bet and the bet is a billion dollars. I mean, that’s Yeah, I’ve heard from Thor Khan from Robert Hargraves, or they have a different, you know, they have a salt reactor that they want to do in, in power ships. But you’ve both given me the same number, you need a billion dollars. I mean, you, you got to have a stout investor that’s willing to say, oh, yeah, well, here’s a billion dollars.
Simon Irish 1:05:38
Well, you need an investor that’s price sensitive in pursuit of an opportunity. So yes, you need you need an investor that recognizes the commercial opportunity, from adopting this technology and deploying it, which goes back to that green go sign because there are some strong incentives to adopt wind and solar, you know, 15 years ago in terms of tax incentives, etc. So your those those incentives, I think, can apply to, to nuclear and the nuclear industry and can have a similar effect.
Robert Bryce 1:06:07
And so you’re going to need that, that that the tax credits, I mean, this is what’s clearly what’s been driving well, it’s
Simon Irish 1:06:13
always driven innovation in a lot of other industries. It works production tax credits, incentive investment tax credits. I mean, there is a policy framework that exists today. And I will say, Robert, that it is growing. And the good news is that the trend line is extremely encouraging,
Robert Bryce 1:06:32
in a way, but it needs to go faster. Well, if you
Simon Irish 1:06:37
think China’s competition, you’ve got to realize that, that there is a you’ve got to make the innovation cycle in open competitive Western markets. Move faster?
Robert Bryce 1:06:51
Sure. Yeah. So just a few more questions, Simon, and I appreciate your time. It’s been I’m glad glad to catch up with you now, seven, seven years later. What about the industrial base, though? Because this is the other. I mean, you’ve got the regulatory, you’ve got the technology, right? And it seems like it’s very viable, you’ve got the regulatory issues, which you seem like you’ve got a pretty good handle on but now you have to make it and you have to make not just one, you have to make a whole bunch. And this is one of the issues that I think has been haunting the large reactor space, right, where you’ve got to have the forging capabilities, and there’s only one place in the world or, you know, Japan has one of the so how do you scale this? And then I’ve got just a couple more questions. Yeah. Sign off, though. How do you how do you make sure that you have the industrial base available in the manufacturing base that you can scale and you can not just build one or two, you can build two or 300? Well, that
Simon Irish 1:07:41
becomes itself becoming more important when you’re talking about the type of pressure vessels that are essential for traditional reactor technologies. Because that they were left in a world where, you know, you’re running about couple of suppliers. Sure, engaged with and they I think they’re in Asia, right in time. That’s not fact of conventional reactor technology. So our technology, we don’t have, you know, our reactor vessel doesn’t operate it, you know, 160 170 atmospheres, it’s, it operates effectively atmospheric pressure. So it doesn’t require that, that that level of ultra sophistication with respect to steel forging, it’s a more standardized industrial industrial component. So because it’s more standardized, we think, again, it can be it’s more scalable, with existing industrial infrastructure. They exist in the United States and elsewhere.
Robert Bryce 1:08:42
But that’s that, so Okay, well, so that’s so that we hadn’t talked about the pressure issue. But yeah, that’s the key, right? If you don’t have your operating, you’re operating at high temperature but low pressure, so you’re not going to necessarily need some super sophisticated manufacturing base. Because of that. I’m trying to simplify that. But that is that a fair assessment?
Simon Irish 1:09:01
Yes. I mean, in terms of major component procurement, we and this shows where we’ve got to with commercialization. Now, we’re not out there announcing, Mr. Hughes, we have last 18 months in pursuit of deployment with a BGA. We were announcing contracts for major procurement for the procurement of major components for our power plant, we are going to get we’re going to get our, our steam generators from New from Siemens, we’re going to get industrial pumps from KSB pumps in Germany, we’re going to get our fuel from from Iran and Westinghouse in Europe, no, and so forth. So the the attraction about this design is that we seek we think this is very important for commercial mission is we seek to to use as much as existing industrial capabilities we can there’s obviously truth on the so important on the fuel side, but it’s true with respect to where you’re going to get your steam generators from where you’re going to get your pumps from where you’re going to get your to You’re active vessel from. So we’ve we are working with suppliers now for those procurement of those major components
Robert Bryce 1:10:06
off the shelf components, I guess, but it’s nice
Simon Irish 1:10:10
if they can be totally off the shelf. But certainly the the the counterparties that we’re engaged with have the capabilities of customizing their existing products to meet our needs. And that customization is really valuable with respect to steam turbines, because for a conventional reactor system, particularly a boiling water reactor, the steam turbine is is is hyper customized to the needs, that’s a nuclear component and regulated the surge, our steam turbine is is a standard industrial component, not a nuclear component. So that’s, that’s a benefit for us with respect to new sourcing these components not just for the first plant and being able to repeatedly source these components. Second, third, fourth, fifth sixth.
Robert Bryce 1:11:02
Sure. Yeah. So last couple of things, Simon, and these are questions I asked all my guests so what are you reading? What? I’m sure your your job keeps you quite busy. But surely you have some books on your nightstand? Or desk? What what what is keeping you busy when you have time to read?
Simon Irish 1:11:17
Well, I’ve picked up Alvin Weinberg his autobiography. Haha. And I’ve read it’s that I read it. And that’s that is sort of part of the happenstance getting back to 2011 and 12, in terms of in terms of how I became involved in in the nuclear sector from from from Wall Street? And is it the first time I’ve read it? It allowed me to answer the question, you know, more molten salt reactors were so good. Why did they stay behind the curtain at the National Lab level for half a century? Why did they not burst out? And his his account of the history of innovation in that first nuclear age is very insightful, because the nuclear innovation room Robert is very noisy. You will think that the only noise you hear is the clamor from from industrial users to say we want the cheapest, the most competitive energy source. You can you can you can supply. But the nuclear room in the first nuclear age, and even this nuclear age now is, is there’s a lot of chatter in different directions. Political political chatter, chatter, a lot of political noise, geopolitical noise, noise from the incumbents that want to maintain their position in industry, because they have a very close relationship with government that has served their shareholders well, for so many years. So that is that that is the nuclear innovation room. It is very noisy. And Alvin Weinberg. And the reason I pick up his book, again, is that you need to understand that if you’re going to move forward with your innovation, you need to understand the motives, the voices in the room and understand learn from history. Now, why did the Molten Salt Reactor, not blossom? It was a tremendous technology. And, Robert, I think the there’s not that it’s not a technology answer.
Robert Bryce 1:13:15
It’s a what answer.
Simon Irish 1:13:16
I’m trying to political answer, not a technology also.
Robert Bryce 1:13:18
So it was a culture issue.
Simon Irish 1:13:20
Yes, there’s a political dimension to it as well. But it wasn’t a technology. It wasn’t because it was a technology that was technically inferior. That wasn’t that wasn’t the reason it was
Robert Bryce 1:13:31
the Polit politics or anti nuclear. The in the empty the Yeah. It’s interesting. You say Weinberg because one of our other guests, Eric Meyer with generation atomic Weinberg is one of his personal heroes. So any other books before I go by last year? Yes.
Simon Irish 1:13:45
The other one, the other one is how innovation works by Matt Ridley. Oh, sure. Yeah. Yeah. And I like that, because I think
Robert Bryce 1:13:52
and why it flourishes and freedom. Yes,
Simon Irish 1:13:55
exactly. Yeah. And that’s I’ve only just picked that up. But I like Matt is academically qualified to, to apply sort of evolutionary algorithms that he’s gained from his PhD study of biology and and apply these other algorithms to how innovation actually works. In a, in an open economy. And I think these, these observations are fascinating.
Robert Bryce 1:14:21
Yeah. Matt’s been on the podcast and been on the podcast twice, I guess, one for one for how innovation works. And then on his for his latest book viral, which is also quite remarkable, a great, really fascinating read about the origins of the pandemic. So So my last question, go ahead, please.
Simon Irish 1:14:38
So that that’s probably the next my next read actually. Yeah,
Robert Bryce 1:14:41
it’s, it’s, I recommend it. Also Gregg Easterbrook, Gregg Easterbrook was on the podcast. His book, The Blue age is quite fascinating, but the US Navy in the history of maritime maritime history. So I also asked my guests Simon, what gives you hope?
Simon Irish 1:14:57
Human ingenuity robots. In terms of hope, as a businessman, I, I prefer optimism as a word what gives me optimism. There’s a great phrase from Wall Street, which is from my days in, in London, New York, which is there any two hopes in this world, Bob Hope and no hope. Hope is not a business strategy. But what gives me optimism and what gives me optimism is the power of human ingenuity. And we live in a in a time when, in many ways in many industrial sectors, human ingenuity is delivering some absolutely fantastic innovations and that that power that spirits gives me gives me great optimism as as we look to build a business and build trust for energy.
Robert Bryce 1:15:50
I like that I guess maybe, what makes you optimistic instead of instead of hope now, you may have made me change my closing question. My the late Molly, Ivan’s. I’ve used her line many times I’m optimistic to the point of idiocy was her line. So anyway, oh, that’s, that’s that’s a good quote. I’m the same way. So Simon Irish has been my guest. He’s the CEO of Terrestrial Energy. You can find more about his company at terrestrial energy.com unless you have something else Simon, thank you for being a guest. It’s been great fun talking to you.
Simon Irish 1:16:23
Well, thanks for having me today. Robert. Enjoyed enjoyed on discussion. Thank you.
Robert Bryce 1:16:27
Good. And all you out there in podcast land. Tune in for the next episode of the power hungry podcast and until then, see ya.