| Speaker | Time | Text |
|---|---|---|
|
unidentified
|
I think we could take some shots. | |
| But no, you're laughing. | ||
| We have to start at the basics. | ||
| And that's the kind of things we're going to do. | ||
| So look, if that's not a bipartisan move, because we know that since the last time we changed Social Security eligibility, life expectancy is up for four and a half years. | ||
| So why don't we raise the retirement eligible age up to 70, 72 right now for people born next year and beyond. | ||
| And then maybe put in some escalator. | ||
| Maybe it goes up a month, a year for the next 20 years. | ||
| Just the age and the cost of living calculation. | ||
| Those two things could address a major part of the Social Security issue. | ||
| Coming to a 2028 presidential debate near you. | ||
| How this stuff is going to get worked out in the next president's term. | ||
| We are out of time. | ||
|
unidentified
|
Thanks so much, Gary Cohen, Jerry Parski, Jason Smith. | |
| I'm Reagan. | ||
| Hi, everybody. | ||
| Thanks so much for joining us today for what I think is going to be a really interesting discussion about energy. | ||
| It's called Powering Tomorrow Beyond the Current Energy Debate. | ||
| And I am joined by a lot of doctors. | ||
| Everybody's a doctor but me. | ||
| We have Senator Bill Cassidy of Louisiana, Jacob DeWitt, who's a co-founder and CEO of Oklahoma, which is a small modular nuclear reactor developer. | ||
| And Eli Dorado, head of strategic investments at the Astera Institute. | ||
| And we're going to be talking about what the future of energy looks like in the U.S. and all of the various kinds of resources that are needed. | ||
| There's a lot of talk about increasing demand for the electric grid and just how we're going to be able to meet that with things like AI and lots of data centers coming our way. | ||
| And we are also going to have time for questions from the audience. | ||
| So if you guys want to submit questions through the app, that would be great. | ||
| And we will dive right in. | ||
| I would love to just ask everybody kind of to set the table and tell us what you think needs to be built. | ||
| So I think we need to take the perspective of not of the abstract what should be built, but how do we create an abundance for the American people? | ||
| If all we are doing is saying, oh, you know, we have a lot of natural gas, let's develop natural gas. | ||
| We've got geothermal, we've got nuclear. | ||
| No, the focal point should be what do we do for the American people? | ||
| How do we leverage it to lower their cost and create jobs of the sort that give them a life of dignity? | ||
| Now I come from Louisiana, the Gulf Coast. | ||
| There are people who do not have a college education making over six figures, creating a better life for their children and grandchildren because of energy jobs. | ||
| And we can do that in tandem and indeed leveraging our regulatory environment in a way which gives us additional advantage over other countries. | ||
| So I won't go, obviously I've got a lot there. | ||
| I'll pause for a second, maybe come back to it. | ||
| We should be thinking about the people who are not in this room. | ||
| And if we do that, we win, they win. | ||
|
unidentified
|
I guess I'd build on that and say, yeah, that's a good message. | |
| And I think one of the key things on that, right, is you build lots of infrastructure that enables massive growth for energy supplies is a huge opportunity space we see going forward. | ||
| I think we have this combination of factors today that are actually driving that in a manner that's going to be very accelerative. | ||
| That's a lot of words to say. | ||
| With the demand that's booming with AI, the ability that they have to deploy a lot of capital to pull infrastructure along and actually build power generation assets, and the urgency with which we need to do so, lets us actually start building into that and solving for that problem. | ||
| I think there's sometimes a tendency to think, oh, well, okay, if AI is pulling this all along, they can pay a lot of money for early movements. | ||
| Does that keep prices high? | ||
| Does it sort of invite that dynamic? | ||
| I think not. | ||
| I think what it does is it accelerates with a market-driven approach without needing the government to be the one that's actually funding all these things to pull forward new technologies and actually tap into the potential that things like what we're working on, next generation nuclear have, get through those initial plants, get through that initial part of the cost curve, and then realize the raw fundamental potential that these energy sources have. | ||
| It's hard to overstate the incredible sort of precipice we're on with respect to unlocking, I would call it a limitless energy future by just sort of building off of what we've already done from a technological development perspective in the United States, which is unlocking the true potential of the atom. | ||
| I used this analogy last week, but if this was uranium metal, which it's not, but this golf ball would have enough energy content to power your entire life's energy needs. | ||
| There's enough energy on the available resources of heavy metals we have on this planet with proven technologies with advanced reactors and recycling to power the entire planetary energy budget for five to seven billion years. | ||
| Like that is energy abundance that is hard to fathom. | ||
| And so I think we're entering a world where we're actually going to start deploying into that. | ||
| But that sets the stage for not just doing things that are today, but things that stretch for millennia. | ||
| We are setting the stage for that. | ||
| So it's a pretty exciting time because that's really how we should be thinking about these decisions and these dynamics to create and unleash that. | ||
| Because then you create not just the opportunities that are great for people today, but frankly, for their millennia, for the rest of the planet's time. | ||
| Pretty cool. | ||
| Well, it's great to go last because I agree with my fellow panelists. | ||
| So I can just add on to what they're saying. | ||
| I think we need to think much bigger. | ||
| We need to be thinking about how do we 10x the current energy system instead of incrementally just filling in replacing dirty sources or working on energy efficiency. | ||
| We need to 10x or more our energy system. | ||
| The United States has an embarrassment of riches, of energy resources and technology. | ||
| We invented nuclear power, right? | ||
| We invented solar panels. | ||
| We invented the lithium-ion battery. | ||
| We invented fracking. | ||
| We are today the world's top fossil fuel producer and exporter. | ||
| We've ceded a lot of the manufacturing stuff to China. | ||
| China's building a lot more solar, a lot more batteries, a lot more nuclear than we are. | ||
| And my base perspective is that I agree with what Jamie Diamond said on the fireside chat earlier today, which is that we're getting in our own way. | ||
| And in a lot of ways, the call is coming from inside the house. | ||
| And obstacles like permitting, siting, connecting to the grid, all the lengthy capacity studies, those are the big bottlenecks in energy right now. | ||
| We have so much to exploit if we can get out of our own way. | ||
| So I wanted to ask you guys as well about some of the technologies that you think are ready to go right now and just sort of what could deploy at scale. | ||
| I know I think people from outside of the industry always seem to have a view that it's easy to build this kind of stuff. | ||
| And I know it's very hard to build big projects in the real world. | ||
| But I guess of the technologies, I know Jake's favorite, but of the technologies that are out there, what do you guys think are sort of ready for prime time that could scale up? | ||
| Want to start that way and work this way? | ||
|
unidentified
|
Okay, sure. | |
| So solar panels are already incredibly cheap, like 20 cents a watt. | ||
| It's just ridiculous. | ||
| They're practically free. | ||
| Like, that's not the main cost in building a utility-scale solar plant. | ||
| It's not the panels anymore, right? | ||
| So, it's all the other costs you need to change the way you build a solar farm if you want to adjust to the new paradigm. | ||
| If I'm building a solar farm today, I want it just like flat panels on the ground, no trackers, no other hardware, nothing fancy. | ||
| Batteries are you know, solar panels and batteries have come down like 97% in cost in the last three decades. | ||
| It's just astonishing, and that's not slowing down. | ||
| So, I would say if you want something that's absolutely ready to go, like that's it. | ||
| Nuclear, I don't like, I love the new advanced reactors, but like it works. | ||
|
unidentified
|
Nuclear has worked, you know, we built a nuclear power plant in the 1940s. | |
| We built it in 15 days and turned it on the next day. | ||
| So, we can build nuclear. | ||
| Recent plants have been built for 15 times the cost of what they were built in the early 70s. | ||
| So, the technology is ready. | ||
| It's other obstacles. | ||
| Yeah, I mean, I would say, like, energy, I think, from a sort of a scalability perspective, I think nuclear has the most raw potential because of how significant it can be. | ||
| But obviously, like, it's all of the above that we're going to be having a huge amount of growth around, which is really important and exciting. | ||
| I think on the nuclear side, per what Eli's talking about, something that's I think vastly underappreciated is nuclear fission requires the fewest materials per megawatt hour of any energy source. | ||
| In other words, if you think about what I think of is what's the biggest limiting metric from scalability and cost, or I should say, the most identifying metric is the amount of materials, so the amount of kilograms of steel, copper, concrete, fuel, et cetera, per megawatt hour of energy generated over its life cycle. | ||
| Nuclear fission by far requires the least. | ||
| That's awesome. | ||
| That means it needs the fewest resources. | ||
| It means we should be able to build it the fastest because we have the least stuff to put together, and it means it should cost the least. | ||
| And we have trapped ourselves into these paradigms that if we can actually start, which we're starting to do, thanks to a lot of work you've been doing, actually, but shattering those paradigms about what it looks like to actually move to permit on a reasonable first-principle basis and build and let the industry actually start letting innovation thrive to unlock that. | ||
| I think the idea that people say, well, nuclear is going to take a long time, it is not physically so. | ||
| It doesn't have to be that way from a physics perspective. | ||
| If we can actually unleash innovation and let that run, I think it can scale incredibly and realize some of the same things that you've seen in solar, and it should actually be even more sizable gains because, again, nuclear is on 24/7. | ||
| And like, being a California resident, we need that baseload power supply because the system-level costs of what's happened on renewables have made it so that my cheapest time of paying my electric bills are like 42 cents a kilowatt hour. | ||
| That's insane. | ||
| And my highest are like 65 cents a kilowatt hour, and those numbers are only going to go up. | ||
| So, we're third world country levels, yeah. | ||
| Yeah, exactly. | ||
| So, I'm going to take a different tack today because they look more long-range, and I'm going to work on the here and now. | ||
| Meta is building a $10 billion project in northeast Louisiana, and the amount I think is 800 megawatts that they're going to consume. | ||
| And people are talking about more of these data centers in my state. | ||
| We've got to address that like now. | ||
| Now, I agree that you can build nuclear, but the political, the permitting, the technological fight to do so, bring it on. | ||
| But it ain't going to happen tomorrow. | ||
| We've got to be able to stand up a lot real quickly, and it has to be baseload. | ||
| That right now is natural gas, and it gives you an ecosystem which again supports those families. | ||
| Because I go back to the people who are doing natural gas, working in the field, are making really good money. | ||
| Don't have a college education, but they're good people and they are supplying for their family. | ||
| And they can put baseload up relatively quickly, which meets the demand of society now. | ||
| And we know how to permit it, and we know how to do it. | ||
| And natural gas, by the way, because of natural gas, the United States, see if I get this right, and I got Chris right on the first row, so I know I'm going to totally screw this up. | ||
| But our greenhouse gas emissions in the United States are lower than they were, I think, in 1990, 1998? | ||
| Is it 98 or 90, Chris? | ||
| 1950s on a per capita basis. | ||
| On a per capita basis, but an absolute amount is lower than I think in 1990. | ||
| And so that's an absolute amount despite a much bigger population, a much bigger economy, and more natural gas and oil being produced. | ||
| So I agree that in the longer term, we need to look at nuclear, geothermal, passing out a little bit more in solar. | ||
| The here and now, we need to blow it out for natural gas, which can meet our environmental concerns, economic development, and the power needs that are here and now. | ||
|
unidentified
|
Along those lines on natural gas, there's a lot of talk recently about the supply chain being pretty gummed up and just equipment maybe not being available for the next four or five years or so. | |
| And I'm just wondering how you guys are viewing the supply chain in gas and the ability to add the number of plants that people are talking about building. | ||
| And then it sort of seems like there are supply chain issues across the entire electricity space. | ||
| And I'm just wondering if the same thing could potentially happen in nuclear. | ||
| Yeah, I mean, I'll jump in on this. | ||
| I mean, I think this is, we've seen supply chain shocks for a lot of reasons that we don't need to get into for time's sake here. | ||
| But there's a lot of things that this demand poll is solving, right? | ||
| Just look at transformers. | ||
| That's an area where it was a massive choke point a year ago. | ||
| It's becoming clear that it's going to be less choked, especially with new entrants coming in and less choked with other things happening. | ||
| There's a lot more room there, and the demand is going to far outpace this. | ||
| That's a great problem to have. | ||
| And yeah, there are going to be challenges. | ||
| I mean, we see this on the gas turbine side. | ||
| We've specifically seen, I mean, I agree with the senator's comments on this, this is why we partnered with some folks on the gas side to bring in a gas solution today to bridge us into nuclear where then the gas can support that growth and then transition into a very powerful peaking and support role. | ||
| Pretty cool way to make that work, but we see that there's supply chain challenges on the gas turbine side for sure. | ||
| And we're seeing on the nuclear side a little less challenges on the turbine, but if we start building at these levels, like there are ways that you can make, there are design flexibility points on the nuclear side that can make that problem either harder or less hard. | ||
| I think for some of the smaller reactors doing some things that are operating at temperatures similar to where fossil fire generation is, that's actually accretive to both sides, so that's going to be helpful to avoid some of the same choke points. | ||
| We also see some of the manufacturers here have some trepidation. | ||
| They see the need now, but they don't know the long-term growth. | ||
| They're worried about what are we going to do on an energy policy side because we've done things. | ||
| I mean, look, just a year ago, right, the EPA was introducing some insane views about natural gas requirements down the road, which was throttling some uncertainty on the manufacturing there. | ||
| If we can make it clear, this is going to be an abundance-minded view in policy in the long run. | ||
| You're going to see that kind of open up more and I think accelerate some of the investments to build more turbines. | ||
| But on the nuclear side, specifically, we definitely have a fuel constraint. | ||
| And this is like one of those weird things where we did the right things from a geopolitical perspective, but the wrong things from a domestic perspective in the 90s, where we helped the Soviet Union destroy a bunch of excess weapons material. | ||
| But in so doing, we let our entire nuclear fuel supply chain atrophy and collapse. | ||
| We had more capability and production capacity in the United States for nuclear fuel than the rest of the world combined in the 1980s. | ||
| So under President Reagan's administration, we led the world more than all combined. | ||
| And now we don't have anything. | ||
| So that's going to be something that I think the market again pulls that to spin up. | ||
| And this is where we see creative things happening, where that urgency is something that can be solved with private capital flowing through the ecosystem and spinning up and new entrants coming in. | ||
| So I'm optimistic that some of those supply chain things, they're very real. | ||
| But there are going to be ways in which the more we can sort of open up and loosen sort of some of the permitting bottlenecks and show a pathway and perhaps leverage some of the resources the government uniquely has on the nuclear side, a lot of excess fuel they're not using that we could use, that can open the door for acceleration in a good way. | ||
| I'll say just very briefly, what was just brought up somewhat shows when I speak to my people who are building like power lines, a group out of Alexandria, Pineville, Louisiana, doing a lot of work on this. | ||
| A lot of their transformers will come out of China. | ||
| So I think the administration has to be very careful on this because China is a frenemy. | ||
| We don't want a hot war with China. | ||
| There is an economic dependency right now with China that goes both ways. | ||
| And if we attempt to abrupt that, then that will starve my person in Crest Industry in Pineville, Louisiana, building transformers in Upper New York. | ||
| So I think we have to be very careful on this policy to make sure that we just don't. | ||
|
unidentified
|
Yeah, I mean, I'll echo, again, everything that's been said. | |
| I talked to some data center people at the big AI labs, and they want to go fast. | ||
| They want multiple gigawatts in the next three years. | ||
| And even if they're willing to do natural gas, the turbines aren't there on that time. | ||
| If you do a new order for a turbine, like we said, it's like five years. | ||
| The transformers issue is very real. | ||
| Even the raw material for the transform for making transformers is electrical steel, which is like steel with a particular silicon content, grain structure, et cetera. | ||
|
unidentified
|
We don't make it. | |
| We don't make it in this country. | ||
| So it's a huge bottleneck. | ||
| Yeah, where is it mostly made? | ||
|
unidentified
|
I don't know. | |
| It's a good question. | ||
| Probably China, globally, but we can get it. | ||
| I think there's a Canadian plant or something like that. | ||
| But I don't think that has the volume that. | ||
| So it's aspirational to do that, but right now it's not practical. | ||
|
unidentified
|
It's not. | |
| Correct. | ||
|
unidentified
|
Right. | |
| I think we're going to need so many different kinds of grid upgrades. | ||
| So if you think about electric vehicles, right? | ||
| You're taking the entire energy load of the gasoline stack, right? | ||
| And you're putting that through wires, right? | ||
| And you're distributing it to everybody's home so they can charge their electric vehicle. | ||
| That's going to require distribution upgrades on the grid, right? | ||
| And that's like a whole additional kind of upgrade that I think most people aren't thinking about. | ||
| So there's going to be serious bottlenecks, which is a lot of opportunities. | ||
| But you're right. | ||
| Like if we make it so that we can't get those things done first to scale that capacity to manufacture these things here, we're never going to do it, right? | ||
| If we shoot ourselves in the foot now, you won't be able to run to actually build these things back in the U.S., which would be, I think, what we want to do. | ||
| Well, we went in to ask the senator about the big, beautiful bill that's coming his way. | ||
| And there's a lot of energy credits that are at stake. | ||
| There's wind, solar, battery, nuclear, other credits, geothermal, that the Senate's going to have a debate about next. | ||
| And I'd love to just hear your view on what you think should survive that process. | ||
| Well, of course, ask me in two weeks, right? | ||
| We just got it, and staff is busily looking over it. | ||
| But let's just speak about government role and business credits in general. | ||
| First, clearly, government has a role. | ||
| That's been a little bit of a subtext throughout here. | ||
| But the government initially helped fund George Mitchell's research into fracking. | ||
| And then at some point, boom, fracking took off. | ||
| I make the joke, I'm a gas trencherologist, everything I knew about methane was quite different than what I know about methane now. | ||
| Maybe you get the joke. | ||
| So the point being though is that at some point there is government support as Jacob suggested to get people over the initial cost curve. | ||
| Now you can argue clearly the IRA was incredibly excessive on that. | ||
| But that said there's people who have invested hundreds of millions of dollars into engineering site acquisition permitting to do certain projects. | ||
| To pull those credits just like that, by golly, Republicans are the business party. | ||
| And so my bias is to say if you've made a significant commitment, and I think it's either 5% or 10% of total capital cost towards a project, then the federal government will honor that credit. | ||
| But if it's just your idea in your head, boom, that's gone. | ||
| The way the IRA was originally written was really an open-ended commitment. | ||
| It was just not going to ever be good for the federal taxpayer. | ||
| So I think the way we'll evolve is to shut that off, but to say, if you've made a significant commitment in certain areas, that you will have access to that credit for some period of time. | ||
|
unidentified
|
I think what I think I'd build on that with is, this is one of the powerful things about these tools in the right way, which we need to have the right thresholds on. | |
| I think one thing that was challenging is we had tax credits in place for wind and solar that significantly biased the playing field asymmetrically and sort of not in a way that was I think even-handed for the market. | ||
| And that has distorted things and is part of the contributing factor, I would argue, for why my electric rates are so high in California. | ||
| If we can then catch that up a little bit by keeping some of the good things that help a market-driven approach that tax credits allow for, which is you're having to go through the diligence with your own development, with customers, with investors to actually move a project forward, like the center's saying, that's a helpful catalyst to get some of those initial projects and reduce your cost of capital. | ||
| And it's much better than the things before, which was picking specific technologies where the government would cost share and fund it. | ||
| That is horrible because that leads to optimizing to a grant maker, not to a customer. | ||
| So let the customers pull these things along, which is what's happening, but we can't keep it forever. | ||
| And I do think it's very important to recognize that we gave a massive head start to renewables at the penalty of other technologies that are important for managing electric prices and electric reliability. | ||
| We need to honor that, I think. | ||
| It's pretty important. | ||
| But we don't need it forever. | ||
| In fact, I think it creates some significant misincentives. | ||
| We just need it to sort of catalyze that investment that's coming that people are excited about to supercharge more capital flowing in so that it flies on its own. | ||
| There's more capital on the nuclear side, for example. | ||
| We're in a different paradigm here specifically. | ||
| You know, up until a couple years ago, the industry was so fixated on more government money, more, more, more, more, more. | ||
| I'm speculative, but I imagine, Senator, when you met with companies, they'd talk about the importance of the federal government investing. | ||
| I never agreed with that because that's part of what led to nuclear stagnation. | ||
| There's a lot we could talk about there. | ||
| But what's very important is creating the right environment so that now we have private inflows into the nuclear space that we've never seen before. | ||
| It's awesome. | ||
| What I mean by private is both public equities, private equities. | ||
| It is taking off on its own. | ||
| If you can supercharge that a little bit with these kind of mechanisms, it is going to hit its cruising altitude really, really quickly. | ||
| Or maybe I should use the term escape velocity and it's going to fly on its own. | ||
| And we're going to let the market actually see where that moves to. | ||
| You've talked before about how the nuclear industry never got to go through a period of creative destruction. | ||
| And I guess what does that mean? | ||
| What does that look like in nuclear power? | ||
| It sounds kind of scary. | ||
| Yeah. | ||
| I mean, it is actually having the ability and the thought process to bring better ways of doing things to the market and out-competing what's there today and what's been there before. | ||
| A lot of, just very candidly, it's not a direct criticism of what they do, I understand it, but a lot of the incumbents and legacy of nuclear has been pretty comfortable sitting in sort of a status quo mindset where even the idea of aggressive permitting reform isn't something they want because it's a change, even though it would actually let them be more competitive across the energy landscape as a whole. | ||
| Nuclear is a little less than 20% of energy. | ||
| When I think of first principles, it should be 80% if the industry can thrive into it. | ||
| So let the competitive dynamics emerge where we can bring in more creative, more cost-competitive ways of actually delivering this huge economic potential that nuclear power has and not let regulatory capture, not let government grant making and capital allocation from sort of the federal level capture that market and preserve the incumbents. | ||
| Jacob, you're spending 65 cents per kilowatt hour in California. | ||
|
unidentified
|
Yes. | |
| Nuclear right now is more expensive than gas. | ||
|
unidentified
|
Yes. | |
| And by the way, I keep going back to that family struggling to make ends meet. | ||
| And they're struggling a lot more in California than they are in Louisiana where our energy costs are lower. | ||
|
unidentified
|
Yes. | |
| So tell me, can you bring the cost of nuclear down competitive with the cost of gas per kilowatt hour? | ||
|
unidentified
|
I'm very confident you can be significantly cheaper than gas. | |
| Just because the physics is on the other side. | ||
| Cheaper than gas. | ||
|
unidentified
|
Yes, sir. | |
| Even with the regulatory regime, which literally has paramilitary forces protecting the base? | ||
|
unidentified
|
Well, that's where we need to modernize the permitting and reflect the actual risk. | |
| The regulatory environment keeps nuclear costs artificially higher than they should be. | ||
| But I think if you want to unlock the cheapest source of energy, to me it gets to the nucleus. | ||
| Strong nuclear force is two to I mean 50 million times more powerful than the electric force, right? | ||
| That's a bad way of saying it, the electric force. | ||
| But when you move electrons around in molecules, you get a couple electron volts out. | ||
| Yes. | ||
| When you split atoms, you get millions of electron volts out. | ||
| But I don't look at this as an either or. | ||
| I think gas is critically important. | ||
| We are heavily partnering with gas folks to build stuff today. | ||
| And actually, I think there's a lot that these things work complementary together. | ||
| Because nuclear doesn't make sense in the same ways to be quite as flexible as I think gas does in a lot of these places. | ||
| So I think the future is going to be heavily mixed around nuclear being cost superior is where it gets to, but it's going to take us time. | ||
| And gas plays a really important role to help us get there. | ||
| And guess what? | ||
| To get nuclear to that competitiveness, gas is going to help us get there. | ||
| Right, drive it. | ||
|
unidentified
|
But I fundamentally believe nuclear can be the cheapest source of energy that lowers the cost of electricity for everybody. | |
| Everybody. | ||
| Well, we have the new executive orders last week from President Trump all around nuclear. | ||
| And I'm just wondering how you guys view how that might speed the process. | ||
| I think it's going to be critical for just accelerating the pace of actually getting a few new types of reactors out, built, iterating on them. | ||
|
unidentified
|
We have a national nuclear lab, Idaho National Labs, and they are supposed to be our reactor laboratory. | |
| They're supposed to develop new reactors. | ||
| They have not built and turned on a new reactor since 1967. | ||
|
unidentified
|
And so we don't have a system to rapidly iterate and try new things and improve. | |
| And that is what is going to drive the innovation. | ||
| And so I think the executive orders are extremely positive because they create many paths to being able to deploy new reactors for the first time through multiple DOD paths, through a DOE path that is more flexible and better, and through a mandated NRC reform. | ||
|
unidentified
|
So I think that it's, I have not been as bullish about nuclear as I am ever in my life as I am right now. | |
| Like this is a good time for nuclear. | ||
| There's going to be a lot that is going to happen. | ||
| Yeah, I mean the same thing. | ||
| I grew up in New Mexico. | ||
| I grew up around nuclear. | ||
| I fell in love with it. | ||
| I've always been incredibly optimistic about its future. | ||
| So for me to say the same thing that Eli said actually I think carries a lot for me personally was being, you know, what those represent to actually accelerate and bring to bear sort of an all tools in our toolbox approach to accelerate nuclear deployment is massively important. | ||
| It was very humbling to be able to be actually sitting in front or standing in front of the portrait of President Reagan in the Oval Office a week ago today when the president was signing those. | ||
| But I think what that's going to do is hard to overstate in terms of changing the things that have artificially constrained the ability to iterate, develop, and pioneer and actually run through this cost potential that nuclear has. | ||
| It's going to be awesome. | ||
| It's really going to be exciting. | ||
| My body language probably tells you this gives me a headache. | ||
| Why do I say that? | ||
| I agree with everything they said. | ||
| But we're going to have a different president in three and a half years. | ||
| If it turns out that it's a Democratic president, there's a good likelihood that any executive order with Trump at the top gets cut. | ||
| Because it's what every president does. | ||
| So we need a stable regulatory regime in which people can actually plan investment for not just the next three and a half years, but for the next 8, 12, and 16 years. | ||
| I'm going to toss it back to the folks in this audience. | ||
| You are people of influence. | ||
| The people who are watching, they're people of influence. | ||
| We need to push the federal government, no matter which party is in control, to support nuclear. | ||
| Because if you don't have a congressional action, that which cannot be reversed, it's of an executive, there's always a threat that it will be. | ||
| And I'm not sure the economists will tell me that somebody's going to put down $100 million if an EO is going to cancel what they do in three and a half years. | ||
| So Harry Reid killed the storage facility in Nevada. | ||
| He just killed it. | ||
| And so, and it was just they tore up the papers and threw them away. | ||
| And now where do you put your nuclear waste? | ||
| So I say all that because this is a contact sport. | ||
| If we're going to make nuclear go forward, if we're going to try and get down the price point so low that the family at home has lower utility rates, not higher, then there needs to be a full-scale engagement of how do we make sure that it's legislative, legislatively accomplished, not executive, which is up to the whims of the next president. | ||
|
unidentified
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Eli, I wanted to ask you about an editorial I read of yours from a few years ago from the New York Times that was called something like, we've got to build our way out of this mess. | |
| And I was wondering if you could talk about that a little bit, because it sounds like the issues, you see issues in energy and across a lot of other industries just in being able to build projects. | ||
| Yeah, I think it's so funny. | ||
| Engaging with sort of the center left, they've sort of accepted the problem with housing, right? | ||
| The problem with housing is we don't build enough houses, right? | ||
| And we have zoning laws and we have other sort of land use restrictions and they sort of get the deregulatory need in that domain. | ||
| And it's like, well, let's just extend that a little bit to some other fields, including things like energy and infrastructure. | ||
| And the biggest obstacle to building is permitting laws like NEPA, which required lengthy environmental reviews that can then be subject to challenge in court and so on. | ||
| And they slow government actions down, they slow permitting for private projects down, and it's been an immense barrier. | ||
| We've had some action from the Trump administration on this, actually, like pretty much the most that you could do through executive action, they have done. | ||
| So kudos. | ||
| We had a Supreme Court rule this week that NEPA doesn't require some of the crazy things that agencies had felt that they were required to do before. | ||
| So I think this is, and then the Big Beautiful Bill has some very creative permitting reform language. | ||
| We'll see if it passes the Senate parliamentarian, but it's designed to be a budgetary permitting reform with some budgetary implications baked in. | ||
| And if that works, that could maybe provide an escape valve as well. | ||
| So I think that is One of the most fundamental barriers is our sort of procedural stance on how we permit things. | ||
| And it needs to be more, you know, focus on substance. | ||
| Obviously, we need a clean and robust environment, but it can't be, you know, years of study and litigation before we move forward. | ||
| As the politician, I'm going to say that whatever we come up with that is going to allow permitting reform to go forward has to meet the needs of at least 60 senators, at least seven of whom are going to be Democrats. | ||
| And so how do we do that? | ||
| So Eli mentioned how the left has come to acknowledge that regulatory reform is required in the area of housing. | ||
| Housing is a big issue. | ||
| Homelessness is a big issue. | ||
| You kind of figure out how to land there. | ||
| Ronald Reagan famously said, you give me 80%, I'll give you 20%. | ||
| Really, what's implicit in that, 60% is common. | ||
| Reagan got his 20% and he's willing to give away the remaining 20%. | ||
| I would say in terms of environmental policy, because that's really what this center is on, if we're going to get a robust grid with lots of permitting, it's going to be that the left and the right agrees on how to accomplish that. | ||
| I've been promoting something we call the foreign pollution fee, which is that we say that the United States produces its goods at a lower carbon intensity than almost any nation around the world, particularly China. | ||
| China's growth in greenhouse gas emissions since 1990 has been greater than the decrease in the U.S. plus the EU put together. | ||
| The left is concerned about that. | ||
| The right should be. | ||
| Reagan and HW both used free market concepts to push regulatory reform to address these issues in a way in which Democrats could accept as well. | ||
| So in our foreign pollution fee, we say there's going to be a fee on any carbon-intensive good coming to the U.S. roughly commensurate with the avoided cost of not complying with international norms of pollution control. | ||
| That puts a little bit of a fee on their good, making it less likely that a manufacturer will move to China to produce their taking jobs with them. | ||
| Why is that in good? | ||
| One, it attracts Democrats. | ||
| They like the fact that it lowers greenhouse gas emissions. | ||
| Lindsey Graham likes it. | ||
| He's my co-sponsor on my bill. | ||
| Lindsey Graham likes it because, by the way, it is going to cost China more and they'll have less money to militarize. | ||
| It's kind of a stick it to China if you look at it from Lindsey's perspective. | ||
| Economic hawks like it because it's going to cause a reshoring of industry. | ||
| My families like it because it's going to be more jobs for them. | ||
| So I say that if we're going to accomplish any of this, we need to take that which Eli just suggested. | ||
| Find out where our opposition's values lie. | ||
| Find that sort of 60% we have in common. | ||
| Give them 20%, but it's a 20% we will gladly give because maybe we like it too, and we get our 20. | ||
| And that's the only way our policy is going to move forward as opposed to being a debating society. | ||
|
unidentified
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So is this a tariff? | |
| Or like a targeted tariff? | ||
| It is a tariff. | ||
| We call it a foreign pollution fee. | ||
| It is somewhat akin to what the Europeans have self-styled as a carbon border adjustment mechanism. | ||
| We do not have a domestic carbon tax because there's an implicit tax in the regulatory requirements of complying with EPA regs. | ||
| Any economists, I got two economists, don't tell me I'm wrong because I've been told by others I'm right. | ||
| So there's an implicit tax in regulatory reform and that's what we would base the fee upon. | ||
| And by the way, the behavioral economics is that once a company here is more competitive by lowering their emission profile, they will embrace nuclear. | ||
| Because the lower they lower their emissions, the more the fee is upon another country. | ||
| This is, by the way, I mean, these sorts of concepts were pioneered by Reagan and HW, and all we're doing is standing on their shoulders. | ||
|
unidentified
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Are there other policy mechanisms that you guys see that should be sort of pulled by the government to move certain technologies forward? | |
| I know there's a role for government to play, and at the same time, there's, you know, definitely we seem to be in an era of cost cutting at the federal level, perhaps. | ||
| States are pulling back spending in a lot of ways. | ||
| And, you know, I'm just wondering as an energy consumer and somebody who pays, you know, utility bills, and that's never fun for anybody. | ||
| You know, how should we think about costs for people and things that the government can do to incentivize stuff? | ||
| Like, what's the government role besides providing billions and billions of dollars for projects which they may not be as inclined to do anymore? | ||
| Yeah, and I don't think that's the best answer. | ||
| I mean, I think a lot of, what the center just talked about is actually a fantastic way to stimulate a lot of things. | ||
| So that's a great thing. | ||
| I think additionally, there's ways in which the government can find ways to use its unique resources to kickstart. | ||
| I think fundamental R ⁇ D is always an important investment because that opens the door for so many things that we can't even comprehend and think about. | ||
| That sounds funny to say, but there's so much opportunity from fundamental R ⁇ D that just spurs innovation in all sorts of ways. | ||
| And then that leads to products that can be developed and find a home in the market, attract capital, make things better for people. | ||
| That's what is great about a free market economy. | ||
| I think the other factor is what I was saying before, there are unique assets that the federal government has that can be used to help sort of work through and reduce those overhead intrinsic permitting kind of costs that exist and some of the things that have been the consequences of bad policy for a long time that have led us, for example, atrophy. | ||
| So using federal land, partnering with the government to be able to build, for example, new nuclear facilities where like at Idaho National Lab and other places we're doing that, that's a great way to use existing assets that are just there otherwise. | ||
| You're not needing them to give you money. | ||
| It's just let us come build there. | ||
| Make it easy to do it. | ||
| The amount of work and like just bureaucratic inefficiency we've had to experience there has been staggering. | ||
| We're not asking for a dime from it. | ||
| We just want to be able to build there. | ||
| But we're making progress and that's great. | ||
| But ways to make that faster is important. | ||
| And that lets the dollars that we raise from the private market go a lot further to actually deploying real steel and concrete in the ground. | ||
| Additionally, in the nuclear side specifically, there's a bunch of extra government materials that are sitting there to either be disposed of, thrown away, do something with. | ||
| That material isn't going to be used by the government and it's going to be, it could be used by industry. | ||
| We need to figure out ways to make that accessible. | ||
| And it doesn't need to come with government asking or industry saying government give us money for it. | ||
| It's just, hey, we'll take this stuff that's a waste off your hands and turn it into fuel. | ||
| That will supercharge in our ability to go order fuel, set up better supply chains everywhere else around, which is important. | ||
| And I think the other thing is just, it gets back, Center made a good point with respect to good policy in the nuclear side as well, but I think just across the board, if it's clear that we are driving for the benefits of abundant energy and clean energy, you're going to see things that actually create the stable, predictable aspects for even investing in developing the gas turbine supply chain so that we don't have these same issues. | ||
| We talk partnering with to look at building gas first to bring in nuclear, these co-projects, and it's really hard for them to say, yeah, I can't get our turbine manufacturers to invest because they're not sure the long-term duration of this support. | ||
| We should fix that and change that by making a clear commitment that these mechanisms are lasting and incentivize the right kind of behaviors for the good of everyone because they also come with reduced energy costs. | ||
| That helps everybody. | ||
| I think those are factors. | ||
| And I also think we have to look at system level implications of weird market distorting effects at the local and regional electric markets. | ||
| I think there's a lot of opportunity to be smarter about what we do there to incentivize the right things and not necessarily make it so that we're trying to make energy harder to buy and more expensive to buy and preferentially favor things that don't make energy when we need it, if that makes sense. | ||
| So I think in addition to D-Reg and new technology that you mentioned, I think another thing is just prices. | ||
| So if you look at what's hard about running an electrical grid is you have to keep the supply and demand in balance on a millisecond to millisecond level, you know, and we have this multi-thousand year old technology called supply and demand for prices to acquilibrate supply and demand, and we don't leverage prices as much as we should on the grid. | ||
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unidentified
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Consumers, if you just have a flat rate at home, okay, that maybe decreases your cognitive load a tiny bit, but like you're not incentivized to economize on energy when the cost on the grid is high. | |
| And I think that's very damaging. | ||
| And then it also decreases investments that might organically be made in things like batteries that help stabilize the grid. | ||
| So I would say take a hard look at like let's dial up the reliance on prices a bit more and I think you would see a much stabler and cheaper grid to operate. | ||
| I'm going to say three things. | ||
| First, President Trump has set up a committee for energy dominance. | ||
| Secretary Wright's on there, Secretary Bergham's on there, and other cabinet and sub-cabinet secretaries. | ||
| You need an all-of-government approach in order to clear out, I like the way that Jamie Diamond put it, the blue tape that keeps you from getting energy projects done. | ||
| And it can work. | ||
| After Hurricane Katrina, W went down to New Orleans and said, I want these levees built. | ||
| And something that could have taken 20 years was built probably in two because they put every cabinet secretary around the table and said, don't just sit it, send it over there and wait for it to reply. | ||
| Sign off now and get it done. | ||
| It can work. | ||
| We did it with COVID. | ||
| I applaud the President, the Secretary, and the Secretary for being the leaders of all that, number one. | ||
| Number two, if we've got a supply chain problem with things like rare earth, let's look at the market forces. | ||
| China is going to, whenever we start to stand up rare earth material, they're going to begin to dump on the world market, driving our folks into bankruptcy. | ||
| It has happened, it has happened, it has happened. | ||
| And so we need to have a certain sort of base price that we'll pay somebody producing rare earths in a way which creates enough of a stockpile in case we ever have a hot war with China and they cut off supply. | ||
| And lastly, related to that, I'm speaking to my friends, you know, obviously natural gas and oil, very important to us. | ||
| My independents tell me that they can not live if the oil price goes too low. | ||
| And so if it goes down to 60, they go out of business and all of a sudden we're at OPEC's mercy. | ||
| During the Biden administration, I suggested that they, when oil price was going up, I said, you just need to hedge. | ||
| Give these guys assurance because you need to refill the strategic stockpile. | ||
| So guarantee them a price around their base cost of production, and that way they can hedge and go forward. | ||
| And again, I'm over my skis. | ||
| I got Chris Wright in the front row, so I know afterwards he's going to tell me, oh man, what an idiot. | ||
| But anyway, that said, if you hedge them, then they have that price certainty so they're not laying people off when Saudis flood the market. | ||
| So I do think similar to rare earth, we need to give a price point for our independence. | ||
| We can refill our strategic petroleum reserve and give them the certainty to keep people employed and to keep on going. | ||
|
unidentified
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So on the rare earths front, would you have the government be an off-taker or provide some sort of price floor to be able to keep domestic miners and refiners in business? | |
| Yes, oh, absolutely. | ||
| We have some people to extract the rare earths out of bauxite, kind of a residue of, I may have my chemicals wrong, but a residue of aluminum production, big stockpiles of it back home. | ||
| And they're beginning to extract rare earths. | ||
| And just the week they were going to go live, China flooded the market with cheap stuff. | ||
| Now, that is going to destroy anybody's incentive to begin to market rare earths. | ||
| You got to have some sort of price support that says when the rough point comes and they are going to attempt to dump and put you out of business, we stand with you. | ||
|
unidentified
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I've got a couple of audience questions I wanted to throw your way. | |
| Why is America still treating energy policy primarily as a climate issue when it is increasingly a geopolitical and industrial base issue? | ||
| How do you guys view that? | ||
| I think people are just catching up to that reality. | ||
| I mean, that's just my simple view. | ||
| I think people are just starting to more and more realize what it actually looks like because we kind of forgot some of that for a while and now it's becoming very clear. | ||
| I would say that my foreign pollution fee actually accomplishes all that. | ||
| The foreign pollution fee looks at the interrelationship between climate, energy policy, national security, and economic security. | ||
| And if we can produce more natural gas here, we're going to create jobs, we're going to lower our cost of production, other countries will buy it because they want to quickly lower their greenhouse gas emissions to escape the fee, but that will put a drag upon, say, China's economy, which gives them less money to militarize. | ||
| I would argue that we need to take it into account, but take into account three other factors as well, to achieve a sustainable, robust policy. | ||
|
unidentified
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I think that actually, if you're in favor of energy abundance, you should be somewhat in favor of the climate framing, because this is how we get the center left on board with abundance, right? | |
| And so Senator Cassidy was talking earlier about how we need a broad coalition in favor of things if they're going to stick. | ||
| And if you want to get the left of center on board with the idea of like, we're going to 10x the energy supply, you need to say, it's going to be clean. | ||
| It's going to be nuclear, solar, geothermal, these clean sources. | ||
| Yes, natural gas certainly has a role, but being able to celebrate the fact that a lot of new energy technologies do have fewer emissions and are good for the climate is a way to get, to broaden the coalition in favor of energy abundance. | ||
| So I think it's actually, I'm not opposed to some of that framing. | ||
| Somebody that has done this quite well, Chris Wright, was your company Liberty? | ||
| Liberty.com? | ||
|
unidentified
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Liberty Energy. | |
| LibertyEnergy.com wrote a white paper and I'm told he actually wrote it, not ChatGPT or anyone else. | ||
| And he talks about that balance of climate but with energy self-sufficiency. | ||
| And he does it really well and it captures that balance. | ||
| So I hope I don't misrepresent it, but when I read it, I was very impressed. | ||
|
unidentified
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I think this is one of those things where some of the poll, especially on like the AI piece and other things that are driving a huge demand uptick, like you're going to see that be a market driver to deploy a lot of these better technologies that can open the door for energy superabundance and help us drive through some of these things. | |
| Like I talked about it earlier, but like known heavy metal reserves on this planet with nuclear technology can power its entire energy needs for five to seven billion years. | ||
| Like that's feels pretty good about it and that's very clean, right? | ||
| So you can get the left pretty excited about that because that's effectively a terminal energy climate solution right there that we pioneered in this country by the way. | ||
| I wanted to ask you, I guess along those lines, you've been talking with data center developers for a long time. | ||
| With who? | ||
|
unidentified
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Data center developers, well, all of you. | |
| And I'm wondering how that conversation has changed in the last few years. | ||
| I know, Jacob, you guys a few years ago were talking about a smaller reactor than what you're looking at now. | ||
| And I'm just curious, like, how quickly you've seen the electricity load growth discussion switch. | ||
| Yeah, I mean, Eli said at the center talked about it. | ||
| I mean, it's more and it's sooner, and it's even more. | ||
| And every time you talk to them, it's even more. | ||
| And that's driven, you know, part of our framing of increasing the size was to match what that demand was looking like from the customer side. | ||
| But, you know, they're just chasing everything. | ||
| I think they're starting to realize they're exhausting the existing potential stranded assets that are out there. | ||
| There's still going to be some work around those that can get us some energy for them in the next few years. | ||
| And then it's about developing new generation. | ||
| When I say next few years, I mean the next year or so. | ||
| And then after that, there's going to be this wild dynamic about accelerating new generation deployment, which is where I think all of these things create a really exciting kind of crucible to sort of unlock all these different pieces to try to accelerate that. | ||
| But the simple answer is, or the simple thing we keep seeing is that demand has continued to grow. | ||
| Companies are talking about multiple gigawatts of need for their use cases over the next five years, even more than that over the next 10 and 15 years. | ||
| I think we're in a race to hitting certain AI milestones like artificial general intelligence, things like that. | ||
| There's going to be a big focus on as much energy now to get there. | ||
| But then once we start hitting these sort of what you can do with AI, like for example, you hit AGI, you start realizing the economic superpowers that can enable and productivity enhancements. | ||
| You're just going to see deployment of more to sort of keep up with that, even with significant efficiencies at the semiconductor and energy usage. | ||
| So it's going to be transformative. | ||
| It's not limitless, right? | ||
| But I do feel pretty confident thinking that we're in a world of needing to 10x our energy supply, not just for AI, but AI is going to be a contributing factor to that. | ||
| All the labs say AGI by like 2027 or so. | ||
| So that's the timeframe they're thinking about. | ||
| And if we're bottlenecked by energy, like before then, we don't get there first, right? | ||
|
unidentified
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Because China is not going to be bottlenecked by energy. | |
| It might be bottlenecked by other things. | ||
| But that's not going to be their bottleneck. | ||
| So I think it's really important to think about on that timeline, how do we supply energy to this industry? | ||
| And they're looking at wild ideas. | ||
| So solar and battery-powered data centers that operate entirely on direct current because computers are natively DC devices. | ||
| So you could eliminate the inverter and just operate directly off of that. | ||
| Those are some ideas that are kicking around. | ||
| It's really interesting. | ||
| We've got another audience question. | ||
| There's a consensus in the room about the need for energy abundance. | ||
| However, around the U.S. and the world, there's still a very prevalent belief that we should aspire to consume less energy. | ||
| How much of an obstacle to what you aspire to achieve is this belief and how can we overcome it? | ||
| It is empiric that economic growth rises almost proportionally with energy usage. | ||
| And every now and then you'll read a New York Times article which imagines that emissions are the same as energy usage. | ||
| Emissions have been coming down in the U.S. because of natural gas, principally somewhat renewables, and economic growth has continued to rise. | ||
| If you look in Europe where they've tried to tamp down energy usage, they've tamped down GDP growth. | ||
| Families have become poor in Europe because of energy policy which raises the cost of energy and which does not recognize this relationship. | ||
| If we're going to take care of that family back home, looking for a better life, we need cheap, abundant energy coming out of the power plants, cheap, abundant energy, recognizing that tight R-square statistical relationship between energy use and economic growth. | ||
|
unidentified
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Yeah, I completely agree. | |
| I would add, you know, our ancestors built stuff out of sticks and mud, which are materials that are very low performance and very low embodied energy, and we build things out of steel and concrete, which are higher performance materials and much more embodied energy as sort of a fraction of their value. | ||
| A future that looks like the future is continuing in that direction, where we're building things out of titanium and silicon carbide and like advanced materials that are even more energy, have even more higher energy fractions. | ||
| So we have to, I think, have a sort of more concrete vision about the future that we want to build. | ||
| And I think that would be inspiring to people. |