Terrestrial Energy applying for $800M to $1.2B US loan guarantee to make a breakthrough first commercial molten salt nuclear reactor

Terrestrial Energy USA has been invited by the US Department of Energy (DOE) to submit the second part of its application for a US federal loan guarantee to support the licensing and construction of its Integrated Molten Salt Reactor (IMSR).

The company is applying for a loan guarantee of between $800 million to $1.2 billion to support financing of a project to license, construct and commission the first US IMSR. Idaho National Laboratory has been identified as a lead candidate site for the first 190 MWe commercial plant

The US DOE’s loan guarantee program supports the financing of projects employing innovative advanced energy technologies that avoid, reduce, or sequester anthropogenic emission of greenhouse gases. Terrestrial Energy USA applied for a guarantee under DOE’s $12.6 billion solicitation for loan guarantees for the deployment of advanced nuclear energy projects, issued in 2014. The DOE’s Loan Programs Office has now evaluated Part I of Terrestrial Energy USA’s application and invited the company to submit the second part.

Molten salt reactors use fuel dissolved in a molten fluoride or chloride salt which functions as both the fuel (producing the heat) and the coolant (transporting the heat away and ultimately to the power plant). This means that such a reactor could not suffer from a loss of coolant leading to a meltdown. Terrestrial’s IMSR integrates the primary reactor components, including primary heat exchangers to secondary clean salt circuit, in a sealed and replaceable core vessel. It is designed as a modular reactor for factory fabrication, and could be used for electricity production and industrial process heat generation.

Earlier this year, Terrestrial Energy USA parent, Canada-based Terrestrial Energy Inc, announced its plans to engage with the Canadian Nuclear Safety Commission in a pre-licensing design review, a first step towards an eventual licence application.

Why is Terrestrial Energy’s Integral Molten Salt Reactor a big deal ?

  • A molten salt 7.4 MWth test reactor was operated at Oak Ridge from 1965-1969. So no question about technical feasability
  • A conservative first IMSR design should be competitive with established power at about 3 cents per kWh
  • Later designs should be able to get lower than 1 cent per kWh
  • Design is walk away safe with passive safety systems
  • First designs would produce 6 times less nuclear waste and later designs can close the fuel cycle
  • Canada can use the first several hundred reactors to directly produce steam to profitably produce oil from the oilsands
  • Canada and Terrestrial Energy can thus use the oilsand reactors to profitably climb the learning curve before factory mass production of supersafe, super efficient and disruptively lower cost reactors
  • These system could provide 100% of global electricity demand without any emissions

In 2015, Terrestrial Energy had secured CAD$10 million ($7 million) in Series A funding to support its program to bring its Integral Molten Salt Reactor (IMSR) technology to industrial markets in the 2020s.

Terrestrial Energy CEO Simon Irish said that the funds will be used to support pre-construction and pre-licensing engineering, and to support further engagement with industry and nuclear regulators. “These programs allow the Company to demonstrate to industry the commercial merits of the IMSR design,” he said.

Series A funding is a term used to describe a company’s first round of funding secured by selling preferred stock to investors, typically venture capitalists. Details on the source of Terrestrial Energy’s funding have not been revealed.

Terrestrial Energy in January 2015 announced a collaboration with ORNL to develop its IMSR design to the engineering blueprint stage.

The conceptual design stage is anticipated to be completed in 2017.

Canadian David LeBlanc is developing the Integral Molten Salt Reactor, or IMSR. The goal is to commercialize the Terrestrial reactor by 2021.

Molten Salt and Oilsands
* Using nuclear produced steam for Oil Sands production long studied
* Vast majority of oil only accessible by In-Situ methods
* No turbine island needed so 30% to 40% the capital cost saved (instead of steam to turbine for electricity just send it underground to produce oil from oilsands)
* Oil sands producers expected to pay 200 Billion$ on carbon taxes over the next 35 years, funds mandated to be spent on cleantech initiatives
* Canada Oil Sands in ground reserves of 2 trillion barrels, current estimate 10% recoverable (likely much higher with cheaper steam)
* 64 GWth nuclear to add 6.4 million bbls/day (200B$/year revenue)
* 64 GWth needed as about 200 small 300MWth MSRs
* Oil Sands a bridge to MSRs then with time, MSRs a bridge to not needing oil

So each 300 MW thermal MSR would generate $1 billion per year in oil revenue from the oilsands.
A 300 MW thermal reactor would be the same as a 100 MW electrical reactor. Even if costs were as much proportionally as a $10 billion 1 GWe conventional nuclear reactor (the high costs of the most expensive european or US projects.) the $1 billion cost would be recovered in about 2-4 years. Also, they indicated that there is no turbine to produce electricity since only steam is used. So the costs should be $700 million max.

This profitability means that the first 200 units should easily be profitable. Usually making more units has a improvement rate in lowering costs by a few percentage points for each later unit. The oilsand units would also generate the money to help payoff research and development costs, which would initial come from oilsand taxes and oilsand partners.

In previous design discussions about a similar Denatured Molten Salt Reactor , David LeBlanc believed that capital costs could be 25% to 50% less for a simple DMSR converter design than for modern LWRs (light water reactors).

The 25 MWe version of the IMSR is the size of a fairly deep hottub

IMSR design
* No fuel fabrication cost or salt processing = extremely low fuel costs
* Under 0.1 cents/kwh
* Right size reactors, right pressure steam

Later units that include electricity generation can still send steam for cogeneration (use steam for desalination or the oilsand production. This provides another revenue stream for the IMSR nuclear plants.

Looking at the cost components of current nuclear reactors

                                 Old Nuclear    Coal  New LWR est  IMSR first IMSR later
1   Fuel                                         5.0          11.0    5.0   0.1  0.1
2   Operating, Maintenance - Labor and Materials 6.0           5.0    8.0   1.0  0.2
3   Pensions, Insurance, Taxes                   1.0           1.0    1.0   1.0  0.2
4   Regulatory Fees                              1.0           0.1    1.0   1.0  1.0
5   Property Taxes                               2.0           2.0    2.0   2.0  1.0
6   Capital                                      9.0           9.0   39.0  20.0  5.0
7   Decommissioning and DOE waste costs          5.0           0.0    5.0   0.5  0.1
8   Administrative / overheads                   1.0           1.0    1.0   1.0  1.0
Total                                           30.0          29.1   60.0  27.6  8.6   

I think the IMSR can get down to 0.86 cents per Kwh.

Terrestrial Energy’s IMSR (Integral Molten Salt Reactor) features a self-contained reactor Core-unit, (the “IMSR Core-unit”), within which all key components are permanently sealed for its operating lifetime. At the end of its 7-year design life, the IMSR Core-unit is shut down and left to cool. At the same time, power is switched to a new IMSR Core-unit, installed a short time before in an adjacent silo within the facility. Once sufficiently cool, the spent IMSR Core-unit is removed and prepared for long-term storage, a process similar to existing industry protocols for long-term nuclear waste containment. Owing to the extremely low costs of the IMSR Core-unit, it is commercially feasible to operate the IMSR facility in this manner. The sealed nature of the IMSR Core-unit has other benefits, such as permitting operational safety and simplicity.

I have covered how the costs for the IMSR reactor could eventually provide energy at less than 1 cent per kilowatt hour.

Molten Salt Reactors (“MSRs”) are nuclear reactors that use a fluid fuel in the form of a molten fluoride or chloride salt. This is a fundamentally different approach compared to conventional nuclear systems that use solid fuel. A liquid fuel offers unique advantages not enjoyed by reactors that use solid fuel. As an MSR fuel salt is a liquid, it functions as both the fuel (producing the heat) and the coolant (transporting the heat away and ultimately to the power plant). This represents a revolutionary paradigm in nuclear reactor safety: a reactor that cannot lose coolant and cannot melt down, a reactor with a completely fresh narrative on civilian nuclear safety.

The safety profile-engineering complexity-capital cost relationship is completely different for the Integral Molten Salt Reactor. The IMSR has completely different economies of scale, owing to the fact that it is an entirely different reactor system. This is commercially very significant. The IMSR can be built small and modular, yet remain highly cost competitive. The IMSR first-of-a-kind reactors will be constructed in a variety of power outputs, from the very small, 30 MegaWatts-Electrical (MWe) or smaller, up to 300 MWe and larger still. IMSRs can also be arrayed in a multi-unit facility for greater output if necessary. IMSRs are modular and designed to have very small land footprints. The IMSR can be manufactured with material readily available in today’s industrial supply chains, with methods common in modern factory production and in high unit volume. The IMSR can be shipped to a power plant located at point-of-demand via flatbed truck or rail car. The IMSR is fuelled with uranium, a terrestrial source of energy with a density many times greater than the expensive combustion energy of fossil fuels. The IMSR unit is scalable, its production is scalable, its industrial use is scalable — scalable to displace coal.

Fuel Recycling

When nuclear fuels “burn”, they release thermal energy and fission products are created. When fossil fuels burn, they release thermal energy, and CO2 and water are created. The fission products are the real waste from fission energy, as CO2 waste is to fossil fuel combustion. Fission products must be removed or the fission reaction will stop, just as CO2 must be vented from a car engine or the engine will stop. When fossil fuels are burned inefficiently, they create toxic by-products, which are, partially burned fuel. The same is true of a nuclear reactor system. When fission nuclear fuels such as uranium are burned inefficiently they create plutonium. However, if a reactor system can remove the fission products, it can burn its fuel far move efficiently and potentially leave no plutonium. This scenario is not possible for the solid fuelled reactor systems of Conventional Nuclear, as the fission products are trapped in the fuel by design. For Conventional Nuclear reactor systems fuel and waste efficiency can only be achieved by the centralized reprocessing of the waste fuel. Reprocessing of solid fuel waste to create new solid fuel is very difficult, both technically and commercially. For these reasons, waste reprocessing has limited use today despite the issues of plutonium waste. Furthermore, in practice, solid fuel waste can only be partially recycled; only a partial improvement in efficiency for all that complexity, effort and cost.
This is not the case with the IMSR using a liquid fuel. Firstly the IMSR allows many fission products to be removed continuously and in-situ. They simply vent from the salt and are captured by the IMSR. Hence, even without any reprocessing of waste IMSR liquid fuel, the IMSR is far more efficient, like a well-tuned engine. In fact, the IMSR is six times as efficient as a Conventional Nuclear reactor – an IMSR power station is expected to leave less 1/3rd less fission product waste and far less plutonium waste.

While the basic IMSR cannot remove all fission products and leave zero plutonium, there are processes under development that can be added to the basic IMSR to allow the achievement of near zero waste. IMSR liquid fuel recycling can be done centrally or in-situ i.e. “on-line”, and both methods can achieve a near zero plutonium waste profile for the IMSR. In this key respect, the IMSR represents a completely new waste paradigm for civilian nuclear power – nuclear power without plutonium waste. The commercial vision is only possible because the IMSR uses a liquid fuel, and chemical reprocessing of waste IMSR liquid fuel into new IMSR liquid fuel is far easier than chemical processing of waste solid fuel into new solid fuel. Terrestrial Energy believes that both online and centralized reprocessing of IMSR waste fuel are highly viable and will become standard for the next generation of IMSR power plants, possibly by the end of the next decade. This future does not exist for Conventional Nuclear using solid fuel.

IMSR differences from other Molten Salt Reactors

Other MSR development programs, including the extensive original U.S. program from the 1950s to 1970s, are generally focused on two key objectives: i) to use thorium-based fuels, and; ii) to “breed” fuel in an MSR-Breeder reactor. Terrestrial Energy intentionally avoids these two objectives, and their additional technical and regulatory complexities, for the following reasons.

Thorium is not currently licensed as a fuel. Liquid thorium fuels are the nuclear fuel equivalent of wet wood. Wet wood cannot be lit with a match; it requires a large torch. That large torch must come in the form of, for example, highly enriched uranium (HEU). Such a torch has no regulatory precedent in civilian nuclear power. Furthermore, the use of proposed thorium fuel with HEU additive leads to valid criticisms of the proposed reactor’s proliferation and commercial credentials. The thorium fuel cycle would require its own involved regulatory process to become licensed for use on a wide commercial basis. The liquid uranium fuel of an IMSR can be lit easily, it is dry tinder.

It is the design of the IMSR itself that achieves exceptional fuel efficiency and a much reduced waste profile, and not the fuel. Consequently there is little or no benefit to utilizing a thorium fuel cycle in an MSR. The IMSR will use Low Enriched Uranium, or Slightly Enriched Uranium, each of which are broadly available, and have a long regulatory history and long-established supply chain. The only difference is that the fuel will be in a liquid form and not solid, meaning that far less fabrication will be required. Uranium fuel is licensed, it is in common use, its fuel cycle is widely understood, and it can be supplied as fuel through an existing industrial chain.

The breeding of fuel creates substantial regulatory hurdles, as well as substantial technology hurdles, leading to substantial additional research and development costs. All of this is unnecessary if a reactor is a simple burner. The only reason to breed nuclear fuel is if there is a concern that fuel supplies are scarce and declining. Uranium is geologically abundant and available in quantities sufficient to supply the world’s power needs for centuries. There is no commercial case for breeding, and to attempt to do so creates unnecessary regulation, costs and delays.