A Unique Approach To Small Modular Nuclear Reactors

On the tenth episode of TD Cowen’s Energy Transition Podcast, Dr. Kris Singh, Founder and CEO of Holtec International, joins Marc Bianchi, Industrial Gas & Equipment and Energy Oilfield Services & Equipment Analyst.

They discuss Holtec’s small modular reactor, the SMR-160, and their unique approach including integrated manufacturing and efforts to utilize decommissioned nuclear sites in the U.S.

Press play to listen to the podcast.

Transcript

Speaker 1:

Welcome to TD Cowen Insights, a space that brings leading thinkers together to share insights and ideas shaping the world around us. Join us as we converse with the top minds who are influencing our global sectors.

Marc Bianchi:

Hey everyone, Marc Bianchi from the Energy Research Team here at TD Cowen. We’ve got another podcast installment in our advanced nuclear series. This time with Holtec founder and CEO, Dr. Kris Singh. Holtec does a lot of stuff in the nuclear power field but is probably most well known for making dry casks that are used for spent nuclear fuel storage and for nuclear plant decommissioning.

Holtec also has an SMR design, which they call the SMR-160. We go through the technology, timeline to commercialization, and Holtec’s unique integrated manufacturing model. We also discussed the company’s plans to deploy the SMR-160 at their decommissioning sites in the U.S. Thanks for listening and I hope you enjoy this episode with Dr. Kris Singh from Holtec.

All right, so let’s get started. Kris, thanks so much. Maybe just to kick it off, you could give us a little bit of background on yourself and Holtec. I think Holtec’s involved in a bunch of different businesses and I think it might help set the table for your involvement in SMRs down the road.

Dr. Kris Singh:

As far as I am personally concerned, I don’t like to talk about myself too much, but I’ll tell you in a few sentences. I received my PhD from University of Pennsylvania back in 1972 in applied mechanics, mechanical engineering. And in the beginning, I was more involved in doing research but I realized that to change, the kind of change we want to make, that I wanted to make, I had to get involved in more practical innovations and doing things that will indeed have an effect on society.

So that kind of gradually took me into working for a company that was a small manufacturing company where I learned how to manufacture into consulting technical work, solving problems at nuclear plants. I have been to practically every nuclear plant in the country and I have equipment that I have designed that are practically in every plant in the country. So that’s how my knowledge and experience about nuclear power plants began back in 1971 when I was still a graduate student to today. It was really seeing the plants up close and trying to fix their problems, operating problems.

And today, Holtec is in every aspect of nuclear energy, just about every aspect. We have been quite prominent, as you would know, in spent fuel management. Used fuel, wet storage, dry storage, fuel transport, nuclear waste management. That has been our main activity. We have also looked at the way to make nuclear energy more palatable, more acceptable, or safe if one could say for public to accept. And I think that we are succeeding at that. That really is the main focus today at Holtec.

Our small modular reactor is being worked on vigorously. We have a large number of people working on it here. We developed the interim storage facility for nuclear fuel that’s been licensed to be installed in New Mexico. The new government in state of New Mexico doesn’t want it, so it’s become a problem but we did that also to make nuclear more acceptable to the public. We go to a power plant, well we own four nuclear sites in the U.S. and when we go to those sites and we say, “We are going to build an SMR here,” they say, “but how about the fuel? You’re going to give us more fuel to store here, more waste?” That’s always a problem. So we said, “Heck, we are going to develop a facility, license it.” Now it’s up to the federal government to act, to allow us to start using the facility.

Marc Bianchi:

Yeah, and I look forward to talking through a lot of those hopefully in other podcasts because there is an awful lot to discuss with you guys, but maybe on your SMR, SMR-160, how long have you been working on this project? And maybe talk about what you’ve accomplished so far in the development of that.

Dr. Kris Singh:

We started working on SMR-160 in 2011 right after Fukushima. You say that’s kind of strange, isn’t it? Because I personally thought at the time that the world needs a safer, a significantly safer nuclear technology. And the existing fleet of nuclear reactors, while they are extremely safe, clearly have not met public’s expectation. If you have a TMI, if you have a Fukushima, then you have clearly not met the level of safety expectation that the public expects. Public is perfectly okay if a chemical railroad car derails and people have to be evacuated, that’s two days news and then it’s forgotten. If you have an event like TMI where nobody died, but that’s still remembered.

So the expectation of the public for nuclear power is much, much higher than it is for other industries. So we said we’re going to develop something that is unconditionally safe and safety is the number one goal. It is because it is unconditionally safe, it’s rather large in size, its component, than they would be for a traditional reactor that he builds today. But our focus is that no matter what, he will not have an accident that will cause a release of radioactivity to the environment.

Marc Bianchi:

My understanding, if we look to compare to a larger reactor like an AP-1000 in these kind of Gen III+ reactors that we’ve seen, they do have a lot of safety features built in that are enhanced from prior designs. What additional does SMR-160 do? We hear about passive safety as an example and walk-away safe. What does SMR-160 do that is even further enhanced beyond that?

Dr. Kris Singh:

Yeah. The current generation of reactors, the most recent, AP-1000, they have a pump that runs the reactor coolant. We have no pump. We don’t have any pumps or motors in any safety function, whether it is normal operation or in past-related accident [inaudible 00:07:44]. No pumps. Now, that doesn’t mean we don’t have pumps, but they are not in the safety road, we can do without them. They’re just there built on suspender. The real workforce for our reactor is gravity, force of gravity. That is what drives every single system in our reactor and that’s how it is different. We have 160 megawatt. We designed it because we thought that that will be the quantity of heat energy, the quantity of radiation energy in the reactor is reasonably small. So even if people didn’t quite believe in it, they would know that the extent of release to the environment will be a fraction of the large reactor. So this is kind of building confidence, getting a few built and then we already have designs going where we can have two SMR-160s conjugated using common facilities. That’s already in our license, going to be in our license application.

We are already developing for the future where we’ll have to loop reactor, so it’ll be 300 and it comes out to about 350 megawatt, that will be all in one containment building to bring the cost down again. We are also looking further down the step, we’ll have four group that will be 640 megawatt, but we are going to do that in steps. We have to remember, a real jump in technology creates also concerns in people who look at it, including interveners and extreme people who challenge nuclear to begin with. So we are going to start with 160, make some of them. Make 320, really 350 that are together, two containment sites next to each other and use common facilities and then we will go to double loop in single containment. That’s the plan. So we are not stopping at 160, no.

Marc Bianchi:

So there are two other companies that are having some decent commercial success with light water small modular reactors. So I’m thinking of NuScale and GE Hitachi. How does your offering compare or differ to those? You mentioned the gravity as a way of cooling and I think that kind of is similar to what NuScale is doing, but maybe just talk about some of the design features that might be different in what you’re offering.

Dr. Kris Singh:

You know, GE is a boiling water reactor. Boiling water reactor is a simple concept compared to a pressurized water reactor because you’re taking the steam from the reactor and running the turbine with it. You don’t have an intermediate steam generator like we do in pressurized water reactors. But there’s a price to pay. When you do that, then your steam theoretically has radioactive contaminants, comes right out of the reactor. So the whole plant becomes contaminated and you cannot use that steam for process applications. And we have designed our reactor so you can take the steam and use it in a cement plant or a paper mill. You know, in any process application that steam is clean, you can use it. The boiling water reactor is simplified, is a direct conversion from reactor steam to energy, so I would say it’s a less complicated plant, but it has that limitation that I just mentioned.

NuScale is a pressurized water reactor plant just like ours, but there is a fundamental difference between us and we are two schools of thought. I don’t mean to denigrate their school, their thinking, but this is how we differ. NuScale designed their reactor so the steam generator is inside the reactor vessel. Optically, that is a major difference.

The DOE had coined the term integral reactor, meant that the steam generator is inside the reactor vessel. We looked at that requirement and we told DOE at the time that we don’t think it’s a good idea and we will not propose one. So it’s a fundamental difference. Now the reason why we would not propose one will take me two hours to explain to you, but fundamentally based on basic heat transfer thermodynamics, structural mechanics, we did not think that that is the right path for us.

So we diverged from the beginning. NuScale was developing an integral reactor, we were developing a situation where the steam generator is very close to the reactor but not inside it. And our steam generator weights 800 tons, it’s a fairly large vessel. We could not put it in the reactor vessel. This steam that is produced in NuScale is inside the reactor vessel in a separate heat exchanger called the steam generator. We did not think that’s a practical or feasible design, at least from our scientific perspective.

So we have always stayed with a reactor where the steam generator is a discrete vessel but it’s right next to the reactor and we have some intentions on how to do it so they can be together. They are really coupled right at the neck. So that’s the main difference. There are of course many differences because of it, but I think NuScale has done well by increasing their power output per reactor. That’s what they are relicensing, I understand, which is good. Look, I want them to succeed. I want everybody to succeed because the world market is so huge, the demand for clean energy is so enormous that none of us can do it alone.

Marc Bianchi:

On the point of steam, so one of the things as some of these Gen IV reactors have started talking about their plans, you can get higher heat from them, which seems like it’s well-suited for industrial applications. Light water reactors, my understanding is are closer to maybe 300 celsius whereas some of these Gen IV reactors might be 500 and above. I’m curious, is there an opportunity to increase the heat of the steam or anything you can do to expand the addressable market for your technology?

Dr. Kris Singh:

Yes. The steam produced from our reactor would be roughly, I’m going to give you in U.S. units, about 600 degrees Fahrenheit. But it can be, we have the technology to pressurize the steam to make it super-heated if necessary using a technology we call green boiler. So that steam can be, depending on the need for a particular site, we can process that steam further to increase its pressure, to increase its temperature, to increase your super heat, to increase your [inaudible 00:15:50], we can do that.

Marc Bianchi:

Can you talk a little bit more about the green boiler because I was going to ask about that later on, but maybe while we’re here.

Dr. Kris Singh:

A green boiler, yeah, I’ll tell you. A green boiler is basically has two functions. One is, it will accept energy from anywhere from the grid. If you have cheap power, you take energy from the grid, from a solar plant, which we have also developed by the way, that you can put right next to the nuclear plant and capture the energy from the sun.

Marc Bianchi:

And this is concentrated solar or focal?

Dr. Kris Singh:

Yeah, concentrated solar, yes. And it will take steam from the SMR reactor and you can in the green boiler add heat to it to increase its pressure, increase its temperature, really. You can do that without any problem, that’s what the green boiler does. The solar, concentrated solar as you know can be very, very hot. Well, the green boiler will take this. So the green boiler look at it as first energy preservative. You can put energy heat in there, you’re not going to lose much. The rate of loss is very, very low. So you can take energy produced during the day from the sun and use it all night or use it three days later. You know what I mean? So it gives you that capability.

The other, you use it because it’s got a steam generator built in it. So if you crank it up, it’ll take the heat stored and start giving you steam at the pressure you designed it for. So green boiler is the intermediate unit that will allow you to store excess energy. The problem in the economy also, so much of energy gets wasted. When you’re producing, the power demand is in there so you end up either load following or turning off plants, right, you peak up plants, all that problem goes away. Any extra energy you produce, you put it in the green boiler and use it when you need it.

Marc Bianchi:

And this all, presumably, this would work with any source of heat. It doesn’t need to be part of a SMR-160. You could presumably be selling this to others?

Dr. Kris Singh:

That is correct, yes, yes. But these are parallel technologies we have been developing. SMR group doesn’t want us to be offering it to other people, but we will offer it to everyone. I mean that we work with everybody who needs such technologies.

Marc Bianchi:

One of the things that seems different about your approach, and correct me if this is wrong, but you are going to be manufacturing the components for the SMR-160, whereas the others are relying on the nuclear supply chain and they’re more of a technology provider. What advantage does that give you, and then I have some questions about cost after that.

Dr. Kris Singh:

My philosophical approach is if you don’t manufacture, then you don’t know how to design. You can put it in bold letters because I have lived that life, I know it. I’m a designer, designed a lot of equipment and I could not have designed a real good equipment if I did not also manufacture. I’ll go to the shop floor and ask the welder to show me how to weld, how to really understand what can and cannot be done. And this goes back 50 years, but the idea, I have not never veered from the idea. If you’re going to provide a reactor, we have to know how to build it. And that’s how you will make a reactor that you can build for the money, you estimate it. If you don’t, if another party is manufacturing, first of all you introduce additional cost because each company now has its own overhead and GNA to add to the cost and supply chain. But I call it the MBA school of thought. The MBA, are you an MBA?

Marc Bianchi:

Yes.

Dr. Kris Singh:

You are, okay. So you’ll appreciate it. The MBA school of thought is that you minimize, you eliminate waste in your supply chain. If you can’t manufacture efficiently, then give it to someone who can and use multiple suppliers to compete to get the price down. That’s the MBA school of, call it reactor supply. My school of reactor supply is that we learn the product by manufacturing and because we manufacture all the time, we have a inventory of knowledge about manufacturing that allows us to build, design the equipment better. And that feedback between manufacturing and design in my mind is critical.

A lot of people think that I’m crazy, they don’t believe in it. Clearly they don’t do it. Westinghouse had, when I started my career back in 1971, Westinghouse had manufacturing plants all over the country. They shut them down because they could buy the same product cheaper from others, smaller manufacturers. Was that a great idea? I didn’t think it was a great idea then and I don’t think it is. So I will always, as long as I’m in charge of any organization, I will be manufacturing what we designed. If you go to our shop here in Camden, New Jersey from where I’m talking to you, in that plant you will see perhaps 50 capital equipment under manufacturing at any given time. And every one of-

Marc Bianchi:

Casks, is that?

Dr. Kris Singh:

Casks, would be heat exchangers, capital equipment, general. And you would find that every one of them is designed by us and a lot of them use our patents. So they’re only manufactured here in Camden, no place else in the world. They’re based on our patents. But this feedback between design and manufacturing is critical and you can’t have that if you have two different organizations doing it.

Marc Bianchi:

Maybe talk to us a little bit about the plan for manufacturing capacity, because I think I saw some stuff on your website and news announcements about what you’re planning to do there, there may even be some effort to get some LPO money for that. Maybe just walk us through that if you could.

Dr. Kris Singh:

Well our LPO application is for about $7.2 billion and that involves a megafactory that will be five times the size of the plant here. Now it may be one megafactory or it may be multiple factories of the same size we have here. But increasing the manufacturing capacity is an imperative. It has to be done. If we don’t do it, somebody else will have to do it. It has to be done.

America’s manufacturing capacity has declined severely in my career lifetime. We have to rebuild it. So part because we have a product that we have engineered and we think we’ll sell 1,000 of the SMR-160s, so we need to manufacture them and who’s going to make it. So yes, we are on the path to, today there’s a state delegation here in my office. I left them to come talk to you. They are, see how important you are, Mark. That delegation, they have come to talk about manufacturing in their state. That’s important to them. I think it’s important for our national economy. We cannot be just a paper pushing country. We have to manufacture.

Marc Bianchi:

Yeah, and I think that’s one of the hopes that people have for nuclear is if we’re going to scale this deployment up, we need to have lots of people that are trained in building these things and really a workforce that’s much different than what we have today.

Curious to hear what your thoughts are on cost reduction. So there’s this whole first of a kind, nth of a kind conversation that people have and I think generally speaking the thought is the nth of a kind would be maybe 50% of the cost of the first of a kind. But I’m curious, given your integration approach and the size of your plant and how you’re looking to build it, how are you seeing those costs starting and then finishing?

Dr. Kris Singh:

Yeah, we have considerable experience in this area. We will design a cask first time, build it, and then we’ll build 10 more. And this happens quite routinely here. Our reduction in cost, it depends on how much energy and thought you put in the first design. Generally, people don’t put in as much energy and thought because they’re busy trying to get the license from the NRC. The critical step is how much planning or manufacturing evolutions have you done? Most cases, people don’t do any. We do extensively. As a matter of fact, people ask us to put a price for the system, we say not yet. Not until we finish that step. Then we know what the cost would be and we think that whatever we do, the first one, the next one would be, and this one would be 30% less. Not 50%. If it’s 50% then we are failing.

Marc Bianchi:

Right, the first one’s too expensive if it’s 50%. How many units do you think you need to deliver to get to that 30% reduction? And I’m curious the DOE has-

Dr. Kris Singh:

Five.

Marc Bianchi:

You think five? Okay. So do I think DOE said five to 10, they had that Nuclear Liftoff Report, which I’m sure you saw, but they had said five to 10 in the order book, but I think that it was more like 10 to 20 delivered of the same kind to get to nth of a kind cost. I’m just curious from an industry perspective, not asking about Holtec, but just more broadly, how do you see that projection? Do you think that’s going to be accurate?

Dr. Kris Singh:

Well the manufacturing of the entire plant consists of 100 different manufacturing travelers steps. You have to build, whether you build the steam generator, you build the pressurizer, you build the reactor vessel, build a slew of other tanks and heat exchangers and then of course people are, you’re buying standard turbines so there is no savings there. Condensers, MSRs, there is a lot of equipment that each one has its own challenges and some of them because of prior experience that we have would be less efficiency improvement realized. Others where we have not built before, there will be more efficiency realized.

But mostly I look at savings as once we build one, we see what we can do by way of fixturing and automation, because that is where savings are. And you cannot as much as we simulate and we can’t catch them all. So we basically, as we are building the first one, we are drawing lessons from it and then we will buy robots, we will buy fixturing equipment to make the next one more efficient. And that will be in, if you think of the plant a hundred parallel manufacturing and construction operations going on, each one will have its own learning curve. Some would go faster, some would go slower, but ultimately they all… Our cask manufacturing, for example, today has matured where if you come to our plant, they’ll tell you this robot was put in 2018. This one came in 2016. It’s all process of development. As you become familiar with the challenges in making a system or equipment, you develop the necessary tools to make your process more efficient.

Marc Bianchi:

Maybe you could talk to us about customer prospects a little bit for SMR-160. So I think I saw something about UK and Czech Republic, but talk to us, take us around the world and talk about the opportunities you have and maybe what you think your timeline is to having a unit in commercial operation.

Dr. Kris Singh:

Well, to answer your last question, we expect our first unit to be in commercial operation by 2030, possibly 2029. That’s our first, an easy answer to give.

Marc Bianchi:

And where is that?

Dr. Kris Singh:

Well, I’m going to tell you that. We have two pathways. One is to build at a nuclear plant we already own. Palisades being one where we are restarting that plant. God willing, we will restart that plant. If we restart the plant, that will be the natural site to put in two more SMRs there. That has got everything going. Environmental impact has been done, the site is approved, it’s an operating reactor, there is land there to put in the additional units. So that will be a natural one. We also-

Marc Bianchi:

While you’re on that, Kris, just where is Palisades in the approval process?

Dr. Kris Singh:

Right now, NRC has indicated that they’re not going to consider Palisades to be a new license. It’ll be reinstating the existing license. That makes it a lot simpler. So clearly the regulator does not look at it as a safety challenge. And we think that in a year to 18 months we will get through that process with the regulator. The state of Michigan seems to be supportive, which is very critical. The state is, they are supportive and the DOE loan office also seems to be supportive. So this all will come together by this fall, we should be most likely greenlight to go or we find a problem and this time we don’t do it. But it Palisades goes forward, then SMR-160s first place of birth will be in Palisade site. Looks likely because it’s just so ideal.

It cuts two years off of your schedule. If you don’t have to do a high metal impact statement, you don’t have to worry about all the support grade infrastructure, switch yard, all the paraphernalia that goes with power generation. It’s already there. So we look at that as a good opportunity. We also have Oyster Creek plant here that we own. If the state of New Jersey were to be equally aggressive, that will become a viable site. But it depends on the state. The first mover states have to belly up to the bar to put some.

Marc Bianchi:

How many decommissioned sites around the country do you think are… I don’t even know how many decommissioned sites there are at this point, but how many would be potentially eligible? Is there a certain period of time where it’s been decommissioned and it couldn’t qualify for this type of [inaudible 00:31:58]?

Dr. Kris Singh:

They’re all eligible but the public opinion is not the same around each plant. Some plants, for example, we own Pilgrim in Massachusetts. They are kind of overtly anti-nuclear still. So we are not going to think about proposing a plant there. Indian Point, which we also own, is not a hospitable site for putting a nuclear reactor. So we are not going to do there. On the other hand, Oyster Creek is. People want it, and the state has to basically, as I said, has to belly up to the bar because it will cost them some money to get it built there. And Michigan is for sure.

Marc Bianchi:

Okay. How about outside of the United States? What is the opportunity set looking like?

Dr. Kris Singh:

Outside of United States I put countries in two categories. One that are desperately in need, others it would be nice to have. And they plan ahead and they will have to come on board. UK is not facing an energy crisis. UK has closed all their coal plants so they no longer have this, the coal problem to deal with, but they’re a farsighted country. They are planning and they’re going to have more nuclear energy and SMRs and we expect to engage with them in a contract soon. We hope to, we will see.

But then there is Ukraine. Ukraine’s coal-fired plants have been devastated by Russian attacks and they need to build yesterday. So they have basically worked out in their strategic plan that we will be build for them 20 SMR-160s in their country at the existing coal plants. As soon as shooting stops, we will look to do that and they will regulate it themselves. They have a very strong regulatory authority. They’re going to begin work evaluating our design. So in a year or so, two years perhaps, licensing is behind us and we will begin manufacturing. We may put up a manufacturing plant there so we can efficient. Building 20 SMRs is a big deal. We’ll have to. So that’s Ukraine for you.

A third country in that category is India. India is producing enormous amount of coal energy and the environment is badly polluted. It has deteriorated in the past 10 years as the country has industrialized. So for them, it’s a crying need and we have been in conversations with the Indian authorities on possibly doing a deal. So far, there is no deal. There is also the barrier of 810, a federal law that prohibits us from engaging too deeply with India. So once that is all behind us, then we expect to build at least 100 there in the next 10, 15 years. Well this is a huge business, Mark. The total SMR nuclear business will be over a trillion by 2050. It’s enormous because it is needed.

Marc Bianchi:

So if we think there’s, I guess I have to think about what a trillion works out to in gigawatts of deployment, but if there’s, I don’t know, 400 to 600 gigawatts that need to be deployed of new nuclear between now and 2050, and I don’t know what your number is, I’m curious if you have a thought on that, but how much of it will be smaller reactors like what you’re doing versus more conventional gigawatt size that we’re used to?

Dr. Kris Singh:

I think that the new generation of reactors will supplant the old ones simply because the new ones are designed with much greater emphasis on safety. The knowledge of how to make them safe today exists. That was only a peripheral thought in 1960s, this generation of reactors came about. So I think what’s going to happen is what I got done telling you in the beginning of our conversation, we have single-loop 160 megawatt. We are going to have two-loop, that will be 350 megawatt. Then we are going to have four-loop, that will be 700 megawatt. That is how it will creep up.

But I don’t think that a standard large plant that had been built have too much of a shelf life simply because they were built with a different approach. They were built with multiple safety systems. One fails, go to the other. The other fails, go to the next one. And that’s how, if you look at the European reactor that Areva sells, it’s loaded with safety systems, but that’s an approach. That is an approach to reactor design I think that has fallen out of favor and the reason is because it makes the reactor expensive. The alternative approach where you go towards simplicity and rely like on gravity makes much fewer systems and you can then build it up. You can go from 160 to 350 to 700 on the same platform. So that’s our approach.

Marc Bianchi:

That makes a lot of sense. I’m curious how you’re approaching NRC licensing in the United States or how you’re planning to. There’s some that are going Part 52 now, but for a first of a kind reactor, my understanding is you would sort of need to be wedded to that design and not able to make any changes, whereas with Part 50 you can be a little bit more flexible. But I’m just curious of your philosophy around that.

Dr. Kris Singh:

Yeah, Part 52, the regulator doesn’t have enough experience in Part 52, neither does the industry. And regulations take some time to incubate and become road-tested, that takes time. And we don’t want to be the guinea pig. It’s an uncertain process in that domain. 52 is a good idea. We will file for 52 after we have built a few under Part 50. Matured the design, matured the details, and we’ll put it in for 52. Not right now. Right now it’s Part 50 and we are developing the PSAR. We have a couple sites in mind as I indicated to you. So we are going to submit with that site application. That will happen next year.

Marc Bianchi:

One of the criticisms of NRC that I’ve heard is the process is long, but even if we scale up, the deployments, just the capacity of the NRC to review these things is not going to be there. So I’m curious, how are you seeing that as a bottleneck to the opportunity for growth here and is it realistic that we’ll have another maybe I think there’s a Part 53 that was sort of in motion that could make things more streamlined. How do you see that playing out?

Dr. Kris Singh:

Well, NRC is struggling with manpower, staff resource issues just like all of us are. We are all going into the same pool of talent and there is a food fight for the talent. There’s not enough people. We are dealing with it in some ways by opening offices overseas. We have an office in Ukraine and our plan is to build that up to 500 engineers in the next two, three years. They have the engineers, they don’t have work. So it’s ideal for us. We will hopefully also build on our existing office in India if the government or government relationship allows that to happen. So we have to make up for it.

NRC can’t do that. They have to find in the domestic market people to work for them. So they have a real resource problem. But I tell you as an agency, the rules under which they operate, I think they have excellent public service. They do an excellent job of serving the industry with the resources they have. They’ll freely admit to you that we just don’t have the reviewers, you’ll have to wait two more months, and I totally understand it. But they are organized. They are a process-bound agency. So the rules they put in place, they follow them. That is not true for other regulators overseas, let me tell you. Some of them behave like they run a medieval kingdom. They basically tell you what it’s going to be and they can change their mind and there is no recourse. That’s not true with the NRC.

So I personally, I’m a fan of the NRC because I deal with regulators all over the world and I see how much better they are. Now in the absolute, of course they can improve themselves and there is always an effort in our country to improve every government agency and I think NRC will improve. Having them subject to the scrutiny of outsiders and they’re looking at it, they’re looking at NRC and they’ve asked me what I suggest would be their improvements. It’s a good process. I’m very proud of the way our country does these things. I really am proud. That’s not the case in other countries. No matter which agency, whether it’s FAA or NRC, they get feedback, knowledgeable feedback from the industry and then they work on it. Congressional office, they work on it. So NRC is, I would say we should give them a break. We shouldn’t be so hard on that.

Marc Bianchi:

If we look at the safety track record of the industries for the two agencies you just mentioned, it’s impeccable. So it is working. We just have a few minutes left here, you’ve been so gracious with your time. But one of the challenges that people see when we’ve got all these first of a kind designs that are out there and the need to build five or 10 reactors before you get to nth of a kind, why is a customer going to sign up for a first of a kind unit without a significant amount of government support?

Dr. Kris Singh:

You’re absolutely right.

Marc Bianchi:

How does that work out?

Dr. Kris Singh:

Government has to step in and provide support. Government is without that, it’ll be difficult to light the fire under this industry and meaningful in a proper way. That is essential. I see that there is effort underway to provide support for early movers. Hopefully it will come to a place where first movers will get the support. I don’t mean a government handout, but I mean a well-calibrated support. So you don’t spoil the supplier industry, you keep their feet to the fire, but you give them the help necessary to get past this initial two challenges.

One, first of a kind cost, which is more, and second, public acceptance. If public were to say, yes, come put it in my football field. And that’s about, our SMR takes two football fields. Okay, we can come put it in here and if there is a call for that there, there’s support for the public to our reactor, then that takes away one big problem. The second problem is, of course, the problem with the first mover costs and there, the government has to step in.

Marc Bianchi:

I think maybe just to kind of wrap it up, if investors or people are following the progress of Holtec and your SMR, what should we be looking out for over the next maybe 12 to 18 months in terms of announcements or milestones? I guess movement on Palisades approval is it sounds like one, but maybe you could just sort of talk about that and leave us with any closing thoughts that you may have.

Dr. Kris Singh:

Well, we have plans and aspirations. The actual outcome depends on a lot of factors. Right now, for example, there is a strong support for Palisades. If you asked me six months ago, I would’ve told you chances are 30%. Yes. Today I would say 60%. Okay. So these things, they change and that depends on a lot of factors.

We hope that we get the first SMR application turned in next year under Part 50 someplace. It may be Palisades, it may be Oyster Creek, it may be a customer who really looks at this as a golden opportunity to become a leader in clean energy nuclear generation. Can be a variety of factors are at place. Very, very difficult to tell. And we are not eradicating our business plan on whether it happens in 2024 or 2025.

We are in it for the long haul. We have many product lines that are all doing fine. So the company will continue to generate the capital, the cash, to support its indulgences like SMR-160. We’ll continue to do that. We have been at SMR-160 since 2011, and all this time we have funded ourselves. So DOE has been gracious to support us in the past couple years. It has accelerated our program. If they support us more, we’ll go even faster.

Marc Bianchi:

Probably a good place to leave it. Dr. Kris Singh, founder, CEO of Holtec. Really appreciate the time.

Dr. Kris Singh:

Well, thank you. Thank you, Mark. And your questions are quite enlightened. You clearly follow the industry intelligently and diligently.

Speaker 1:

Thanks for joining us. Stay tuned for the next episode of TD Cowen Insights.

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