Redefining Energy

Last year, the nuclear industry experienced something close to a gold rush. SMRs — Small Modular Reactors — became the hottest story in energy. Private capital poured in, valuations exploded, and the industry produced an impressive collection of truly bombastic promises. The backdrop is undeniably powerful: electrification is accelerating, geopolitics are reshaping energy markets, and the world needs reliable, 24/7 clean power. Nuclear has rarely enjoyed such formidable tailwinds. So, what could possibly go wrong? Gerard and Laurent bring in Andrei Utkin, Associate Director at S&P Global Energy, and one of the more independent observers of the nuclear industry, to separate the nuclear opportunity from the nuclear hype. Because there is a problem. The Western nuclear supply chain has not exactly covered itself in glory this century when it comes to delivering large reactors on time and on budget. Governments are nevertheless pushing ahead — rightly so. We are particularly interested to see how smaller designs such as GE Hitachi’s reactor in Ontario and Rolls-Royce’s SMR in the UK perform. These projects have something many start-ups do not: government backing, established industrial supply chains, and companies with decades of nuclear experience. Whatever the final cost — and, for reasons that remain remarkably consistent, that cost always seems to go up — these SMRs are likely to happen. But the really fascinating story is the private SMR market. Today, it counts roughly 50 developers, 130 designs, 20 publicly listed companies, and more than $10 billion of private and corporate capital. Yet only a much smaller number of technologies are genuinely approaching commercial deployment. Some have made it to the stock market: NuScale, Oklo, X-Energy, Nano Nuclear. Their share prices all peaked around twelve months ago. Since then? Down 50% to 80% from their highs. Perhaps the public markets are beginning to tire of an industry that has delivered an extraordinary number of promises — and comparatively few reactors. Meanwhile, the executives and early shareholders of some of these companies have managed to cash out hundreds of millions of dollars. Then comes the small detail of economics. With nuclear CAPEX estimates somewhere around $15–20/W — your guess is probably as good as ours — and brutally long lead times, nuclear has to compete with hydro at around $10/W, gas at roughly $4/W (up from about $1/W), wind at $2–5/W… …and solar plus batteries at around $0.40/W. That is an uncomfortable competitive landscape. And we haven't even discussed the fuel. Russia still controls roughly 40% of the conventional nuclear fuel supply chain — and effectively 100% of the HALEU capacity required by some advanced SMR designs. So much for energy independence. Laurent then tackles another increasingly abused acronym in the nuclear world: FOAK — First Of A Kind. What does it really mean? And, more importantly, how many times can a technology be “first of a kind” before investors start asking when the second one is coming? All of this — and much more — in our yearly deep dive into nuclear: the technology, the economics, the geopolitics, the promises, and the increasingly uncomfortable gap between them. ----Link to S&P report on nuclearhttps://www.spglobal.com/energy/en/commodity/electric-power/nuclear Michael Barnard articles on SMRshttps://www.linkedin.com/pulse/scaling-examples-pt-1-small-modular-nuclear-reactors-smnrs-martin https://nbmediacoop.org/2022/07/31/smnrs-riddled-with-high-costs-among-other-unresolved-problems/ And of course World Nuclear Industry Status Report 2026 (WNISR2026) https://www.worldnuclearreport.org/World-Nuclear-Industry-Status-Report-2026 Finally, the full text of 1953 Memo By Admiral Hyman Rickover https://whatisnuclear.com/rickover.html

The global market for Virtual Power Plants is assessed around 100GW (+/- 20GW). It is a 7bnUSD expected to grow at a CAGR above 20% in the next 5 years to reach 40bnUSD within a decade. VPP are a digitally coordinated flexible network of distributed resources: cheaper than central stations. They manage behind the meter assets like Solar, batteries, HVAC, EV… VPP is a term invented 30 years ago by US economist and finance scholar Dr Shimon Awerbuch, who died 20 years ago in a light plane crash over the Alps. Only aged 51, he leaves a great legacy. His foundational work in 1996 was called “The Virtual Utility” where he demonstrated that Electricity generation must be treated like a financial portfolio. He proved that Renewables (even if they were very expensive at the time) were a powerful hedge against fossil fuel volatility. In our series about how digital is transforming the how we track, trade, and optimise energy, Gerard and Laurent have invited Marc Rühs, CEO Next Kraftwerke, the world largest VPP with 15GW Capacity. Connecting more than 14,000 decentralised electricity producers, consumers, and storage facilities, the company contributes to grid stability and optimizes electricity production and consumption based on price signals. It trades its electricity on various European exchanges via its own 24/7 electricity trading platform. Next Kraftwerke has been part of the Shell Group since 2021.We have a deep conversation about how VPP work, their impact on flexibility, and the fact that they used to be ignored or discarded by incumbents. But that is changing with the arrival of AI providing better systems and increased demand. Along the way, we pop some balloons, such as V2G or Heating management, which work great in theory but are non-significant from a volume point of view. Maybe they will in the next decade. As Shell is reducing its footprint in Clean Energy transition assets, it is reinforcing its position in the VPP market, as Next Kraftwerke is fully integrated into Shell trading organisation. Marc demonstrates that the future of energy lies in intelligently connecting renewable generation, storage, demand-side flexibility, and trading capabilities to create a more resilient and sustainable energy system.

In our series: How AI is revolutionising Energy, Laurent and Gerard dive deep into the intricate corner of Energy Management system for large industrial clusters. You would believe that legacy providers such as Siemens, Schneider Electric or Hitachi would provide such solutions. They are not. Indeed, they provide legacy Scada systems which are hardware linked and bottom up. There is no glue to optimise them as a group and deliver access to Energy markets. Two young Belgian engineers have decided to address this blind spot and come up with a new generation of software: AI powered EMS. That is what Companion Energy has achieved. We bring in its CEO Thomas Vyncke. Most of the European energy conversation still focuses on front-of-the-meter flexibility: batteries, renewables and other assets participating in wholesale and balancing markets. Thomas’ thesis is that an equally important — and much less developed — opportunity sits behind the meter, inside large industrial and commercial companies. The problem is complexity. Every enterprise site is different: different tariffs, contracts, generation assets, batteries, EV fleets, boilers, industrial processes, grid constraints and operating requirements. The opportunity therefore isn't simply to buy cheaper electricity or optimise one battery. It is to continuously optimise the entire energy system of the site against its operational and financial reality. That is what Vyncke and co-founder Jonas Verstraeten are building with Companion.energy, founded in 2022. The platform provides transparency on energy costs and automates optimisation across complex behind-the-meter environments. The company says it currently optimises more than €500m of energy spend and 350+ MW of assets across Belgium, the Netherlands, Switzerland and Romania, working with companies including Proximus, TotalEnergies and Port of Antwerp-Bruges. It recently raised a €7.8m seed round to support international expansion. And it is just the beginning… With the energy industry's largest proprietary dataset, world-class experts and decision-grade models, all powered by Synoptic AI, Wood Mackenzie delivers Intelligence Connected across the energy and natural resources landscape.