Mark Nelson is back! (Our first conversation is here 🎧)
We discussed how AI's massive power needs are reshaping energy policy in unexpected ways. 💡
For years, Big Tech has been claiming to run on '100% renewable energy' while quietly relying on nuclear and fossil fuels.
But now, as companies race to build massive AI computing centers requiring gigawatts of reliable 24/7 power, that pretense is crumbling. Starting with Microsoft's Three Mile Island deal for the revival of a shutdown nuclear plant, we explore how Silicon Valley's desperate hunt for steady power is forcing an energy policy reset across the industry and how that may impact anti-nuclear NGOs and policymakers everywhere.
We dive into Germany's (🇩🇪) nuclear situation, Taiwan's (🇹🇼) power challenges (TSMC!), and how the world's richest companies went from being part of the problem to potentially part of the solution.
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📺 Watch on YouTube
Here are a few choice highlights:
"What happened was, tech went from being able to buy a small amount of electricity at any price, to needing a giant amount of electricity at any price."
"What happened recently was... the value of computing changed."
"The fair market price for nuclear energy has just been rewritten by the Three Mile Island deal with Microsoft, and it has separated away from the electricity value from any other source.."
"Every physical spot in the grid must be in balance. Where there's demand, there must be that much supply. Where there's supply, there must be that much demand. And it has to be balanced within a tiny fraction of a percent of the strength of this electromagnetic field."
"But now the energy people whose job it is to deliver energy, not hot air, they're saying, uh, sir, we don't have that power for this data center.
We can't provide it. And, you know, I'm sure they had a moment where the top people are like, well, get more from wherever we've been getting it. We've been getting, you know, 5, 10 terawatt hours per year, and it's been 100 percent renewable. Isn't renewable cheap? Just get more of that. And they're like, well, sir, but we're getting the energy, but they won't sell us the capacity.
What's energy? What's capacity? And BING! Lightbulb comes on and suddenly the people at the top of these Wall Street darlings suddenly realize that the grid is real, that energy is physical, and it matters to get the truth and not the bullshit"
"Q: What about the other plants? Do you think they're, beyond recovery?"
"A: Yeah, well, we have a new metric, right? It's the Three Mile Island Scale. Three Mile Island is gonna be an estimated three and a half years and 1. 5 billion euros to put into operation. And if we have a 1.5 billion euros and three and a half or four years as our line for something worth doing if you're Microsoft in America, well, there's four or five nuclear plants in Germany that meet those standards."
"Renewables are not particularly good fit for the European continent. That's just as a general statement. The European continent has a big North-South climate gradient which would make you think, oh, that's good. You put solar panels down south and you put the wind up north. But all of Europe is extremely far north.
And it's a billion people of moderate to high wealth, very far north. That means on average you have very lumpy, violent changes in where your energy is coming from through the seasons.
Now, that's an incredibly fun opportunity for two bit grad student doing his PhD on some spaghetti code in Excel, showing how, on average, if you take these weather models, you can see how you sort of have this right amount of energy over the year.
That's not saying you have enough physical capacity to balance an electromagnetic field that we call electricity from end to end on this massive continent."📄📄 Further reading by the Radiant Energy Group
⚛️⚡️🔌 More of my writings on Nuclear
Rebranding nuclear power? How can we fight the double standard?
‘The Energy of Tomorrow: The Promise, Failure, and Possible Rebirth of Nuclear Power’
On December 31st, 2021: ‘Germany pulled the plug on three of its last six nuclear plants’ 🤦♀️
NuScale: US regulator will certify small nuclear reactor design for first time ☢️🇺🇸
‘UK to put nuclear power at heart of net zero emissions strategy’, Nuclear Power Edition
🗄 More podcasts from the Archives 💡
🎧 The Cost of Glory with Alex Petkas: Timeless Lessons from Ancient Greece and Rome 🏛️🏺📜 🏹⚔️🦅⚖️
🎧 Going deep on Constellation Software with Mostly Borrowed Ideas (MBI)
💚 🥃 Enjoyed this? Want more? 👇
You can become a paid supporter to get access to paid Editions + access to the private Discord + Zoom Q&As with me + support the recording of more podcasts:
🤖 Raw Machine Transcript 📃
Liberty: Mark, thank you for joining me again for number two or number three, depending on how you count, because we published it as part one and two last time, but we recorded it separately.
But it doesn't matter. I'm just glad I get to talk to you about all this cool stuff.
Mark Nelson: Glad to be here again.
Liberty: So I really need you because, like, so much is going on lately. I think we're at the part of the cycle where, it's weeks when decades happen. And I'm trying to make sense of it all. as a long time supporter of nuclear power, for years it seemed to be like shouting into the void, spitting into a volcano, whatever your metaphor, But now things are changing very, very quickly.
so I want to touch on a few, like, of these big Inflection points, potentially world changing stuff, right? The rise of AI, what it means on the energy front. Big tech all of a sudden loves nuclear powers, embracing it. there's a big change of sentiment policy going on around the world. You can feel it online.
You see a bunch of regulators and politicians changing their minds. Even Sierra Club is starting to signal stuff. then there's all of the other grid stuff, right? That's well changing the heat pumps, solar power and batteries. Are they just going to win because they're getting so much cheaper?
EVs we can talk about all of this, but I just want to set the stage first.
Mark Nelson: Sure. Well, nuclear provides an enormous amount of steady power without carbon emissions, controlled by humans, and it does it on the existing grid which was built to connect power plants like nuclear to the largest users of electricity like cities and factories. So, the idea that people had that you didn't need nuclear in order to do a always on grid powered by clean energy as fast as possible was always complete and total horseshit, But the fight around it was allowed to continue for a long time because the world's richest companies and the banks and financial institutions that served them were pointing in a direction that was false and was not the direction they were actually using. That is towards a 100 percent renewables vision.
That means the academic ecosystem that responds to donors and responds to grant money. It means the, ESG and financial rating system. It means the elite NGOs in the United States and other rich countries that get hundreds of millions or billions per year from donors to push in certain directions.
That entire machine across the world was pointed in the direction that the biggest tech companies claimed to be following. The problem is, the tech companies were pointing in a direction that was set by their marketing teams and their internal culture, not by engineering, not by power, because it wasn't a problem yet.
What happened was, tech went from being able to buy a small amount of electricity at any price, to needing a giant amount of electricity at any price. In both cases, they have it always on. But when they were smaller, they pretended to be using renewables because it's what their marketing team, it's what their, it's what the NGO industrial complex wanted to hear.
And therefore, shareholders and others claimed to want to hear that. So, they would claim 100 percent renewables, but then they would put their data centers, which are, of course, expensive devices, powering high margin companies, right? And They would put the data centers next to dams, next to coal plants, next to gas plants, next to nuclear.
And when I say next to, I mean sometimes literally, but more often just next to in a grid sense, with a fat wire connecting a power plant and the data center. What happened very recently was the value of computing Changed. The value of computing went up a bit as the cost of computing started to go down, and we had feedback cycle that was super intense, super rapid.
The cheaper you made computing, the more you found you could do with it. Back and forth, back and forth. What that meant is, in a very short period of time, data centers went from a bit of computing and a bit of storage of data and other things like that, to now needing to be our super computers. And the size of our biggest supercomputers went from not very big in terms of total computing to now immense.
Because we're training, call it artificial brains, we're training artificial intelligence to do our thinking for us, and we're doing it by just an immense amount of computing and a bit of clever programming. So, in a short period of time, in order to keep up with This positive feedback loop. We went from needing to make data centers of a few tens of megawatts to a few hundreds of megawatts and now gigawatts of power consumption for the most efficient and powerful computers we've ever built.
Liberty: I was looking this up recently. GPT-3 was trained on a thousand GPUs, GPT-4 on 25,000, A100s, and now we have a hundred thousand GPU clusters and they're talking about million GPU clusters being built. This is truly gigawatt scale and it feels like energy will be the bottleneck way before GPU are.
Mark Nelson: So the tech companies that are finding they need this computing power, have been sponsoring an entire ecosystem dedicated to claiming you didn't need baseload power. What you're seeing is the tech companies they're so big now, that they're having to eat their own food.
their own energy policy cooking, and they hate the taste. They can't stand it.
Liberty: And so where will that power come from? because if energy really becomes the bottleneck in the race for AI, does that mean that China has the advantage because they keep building more power plants all the time? Or in the US, will the big tech just displace other customers and, make power more expensive for everybody?
I'm curious about that dynamic, right? And how will politicians react to that? Because it's not going going to be very popular if small players are being displaced by big tech how do you see that playing out?
Mark Nelson: Partly and thanks to Big Tech's promotion of the lie that they were operating on 100 percent renewables, there's a bunch of cities that claim to be operating on 100 percent renewables while being connected to local nuclear plants. thing for the tech companies to do is just take over those nuclear plants since the cities claim not to be using them anyway.
Wouldn't that be great? They almost deserve each other, all these institutions. But, here's the thing. I live in Chicago. Chicago has, let's say, 11 gigawatts of nuclear powering Northern Illinois and the city of Chicago. That powers about 11 million people. 11 gigawatts, about 11 million, give or take. Those are approximate numbers, but it's pretty close. nobody in the city of Chicago seems to have any idea that they're actually nearly 100 percent nuclear powered, What's the loss of just buying up those nuclear plants for AI? In fact, we have something extraordinary just to the southeast of the city of Chicago. We have three double unit gigawatt scale nuclear plants.
So six gigawatts of nuclear power in a tight triangle of three powerful two unit nuclear plants with extremely high reliability. 98%, 99 percent maybe
planned
Liberty: That's best in the
Mark Nelson: and of that, when you add in the refueling outages, it's about 94 to 95 percent capacity factor year after year after year. Which means that, if you simply schedule it properly, and reinforce the transmission between those three nuclear plants, you can power a 5 gigawatt constant power supercomputers while having no more than one reactor offline at any given moment.
It's of the only places in the world you can do this. And here's the next thing. We hear rumors that 5 gigawatts of data centers have been approved to come to Chicagoland.
Liberty: Coincidence?
Mark Nelson: And we hear you look at computing news, you have people like Sam Altman claiming we need seven 5 gigawatt computing centers. I think it's so interesting, this 5 gigawatts, it's weirdly sized perfectly for this tight little triangle of three Nuclear plants built by Illinois ratepayers, you know, by force, it was not a free market in electricity back then, by Illinois ratepayers in the 1970s and 80s. I wanted to break this down for you. These nuclear plants, and this is going to be entirely in 2024 dollars, so I'm inflating all costs to 2024 dollars, right? In 2024 dollars, these three nuclear plants cost approximately, five or six billion dollars to build in total. About a billion and twenty twenty four numbers per reactor.
Liberty: Wow.
Mark Nelson: These plants were given a cash value and effectively sold off to private power companies.
In 2000, in the process of deregulation, they went from being the rate payers, plants that produced at cost and that was bundled into the rate payer bills, these amortized nuclear plants. Right? They'd been paid off, so they were given a value of about $800 million. Okay,
In year 2000, 800 million dollars for these three nuclear plants. That's their value. They were built in 1970s and 80s and troubleshooted over a number of years. At a cost of about, or 6 billion dollars. And the current value today, the book value of these plants, if we work backwards approximately from the share price of Constellation who owns them, we're looking at maybe 30 to 40 billion dollars.
Liberty: And that's not at the price that someone like Microsoft is paying for power.
Mark Nelson: No, no, that's kind of set by the cost that Microsoft would probably
pay for
their
Liberty: Okay.
Mark Nelson: And think about this. They're already built. They've been running for 40 to 50 years. And they're going to be good through 80 and maybe 100 years.
So these plants that were built for 2024 dollars, about 6 or 7 billion, depending on how you look at the costs, have been producing energy this whole time, which is a value to society, and these devices at the end of this process of making power for 40 to 50 years are now worth more than ever before.
They're worth tens of billions. Now, here's the thing, they power Chicago, they power my home, they power my baby's bedroom, okay? And his hospital, where he was born three months ago. But, He's not a rate payer anymore. Not for the power plants. He's a rate payer for transmission. We're rate payers for, you know, delivery charges and whatever renewable energy, subsidy schemes the state dreams up.
we're rate payers for that. We pay for the energy. And it's, you know, a private company that can sell at a fair market price. Well, the fair market price for nuclear electricity has just been rewritten. There was one big thing for this podcast with you.
It was that the value of nuclear electricity has been rewritten by the Three Mile Island Deal. With Microsoft, and it has separated away from the electricity value from any other source.
Liberty: Let's dive deeper into that because I've seen all the headlines. There's Oracle talking about SMRs. Google just announced something. AWS, Microsoft has a huge deal. Three Mile Island, like what's going on here? And is this just the tip of the iceberg, the beginning, or have they all jumped on everything they could find and the next step will be new build?
Or what's going on with this? Help me understand.
Mark Nelson: What's going on is that, since the start of data centers, they've been running 24 hours a day. Now, they're bigger, so you can't fake it anymore and say they can run on a wind farm in a different state, on a different grid even. That doesn't work because you can say that all you want and people could say, wow, what a terribly ethical, moral company that runs on a wind farm in a different state.
That's just amazing. But it doth deliver no kilowatt hours. It does not, it may deliver kilowatt hours, it does not deliver reliable kilowatts of power, constant power.
So now, if you build a solar farm, you can definitely find people that want your kilowatt hours, but they're gonna demand kilowatts.
They want an average output from your solar plant, and you can't deliver it at anywhere in the same universe of the cost that you claimed solar was costing. So that's what happened. Nuclear plants have always been the 24 hour power source. Clean or not, they've been the best. Okay? It's just that the data centers are now being planned to be so big, the value of the computing chips, the capital cost of setting up these data centers is so tremendous that they're not interested in blowing their lead in AI and wasting all their money building these chips that should be running 8, 760 hours a year.
They're not interested in letting them sit idle because of the energy programs they've been promoting for 10 years. Saying 100 percent renewable. Well, the 100 percent renewal, that doesn't go around the clock, but the demand goes around the clock. So what that means is, you need constant power, dirty or clean, and you look better to your shareholders, and you look better to your, own, company staff, and you look probably better to politicians if it's not suddenly revealing the immense amount of carbon you've been putting out this whole time. Yeah, that's the big thing. If you do an honest accounting that says this power plant sent energy to this data center in these moments and that's what it was powered by, you would find that data centers are actually running at about similar dirtiness to the entire grid, maybe even worse.
Because they're needing to be located, so close to such, large constant power sources as coal and gas. So, they've been claiming no carbon emissions, they've been actually running off of carbon electricity, and now that they say they need a truckload more of constant power, nobody has those power plants built, and their next marginal unit of demand, their own, is the size of cities. So they either displace the power that's been powering the cities, or they build more. And it's a hell of a lot easier just to buy up the nuclear plants that already exist if you think you can survive the political fallout. The higher electricity prices are coming. They are coming. Um, the question is who's gonna pay and how that happens.
Now, interestingly, If you live in a part of the United States where we still have a vertically integrated utility structure, you are protected from having to pay the cost of the new entrant industries. they can't just show up and buy up the city of Atlanta's power supply. They're not allowed to. They have to negotiate with the monopoly utility, who then will take the demand to the regulator and say, Hey regulator, we have all this demand.
Because it's such a boon for the economy, we think it's justified that you should put some of the cost of building these power plants on the rate payers while we build the factories and industries that help their, you know, the new economy and help the jobs. And they might say, no, you got to make those new customers pay a bunch for it.
you already asked us for money for a nuclear plant that you took a long time to build. We're going to make you get more from those customers instead of just sharing the cost over all your rate. base customers So this is a sort of cartoon version of the arguments, but effectively, in the North, where we deregulated, it is legal for the nuclear plants to just decide to sell all their power to a data center.
Now, there's a lot of lawsuits happening, and I know I'm getting further and further away from answering of your questions, but I had to get some of this off my chest. There are lawsuits starting between the old utilities that own the lines and wires. And the new companies that own the power plants that used to be owned by the utilities.
Right, so there's IPPs, Independent Power Producers. These companies own power plants and put it onto the grid. The grid is assumed to be like a marketplace, where any electron from any power plant can somehow find its way to any power consumer. It's always been bullshit. Complete and total bullshit.
Bullshit,
Liberty: That's the thing that most people don't understand. And want to double underline this because the argument that someone hearing this would say is the 100 percent renewable thing is, okay, maybe we don't use directly those electrons, but we add them to the grid over here, right?
we build new wind farms and new solar and it's all commodities. it's all
electrons
and it balances out.
Mark Nelson: fine. Then build your
data center over there in, in, at the edge of North Dakota, or build your data center in the desert of Arizona next to the solar park
Liberty: Yeah. The utility is not the same,
right?
Mark Nelson: you can't get the constant power for anywhere near the price that you were quoted for the energy alone but not the firm capacity from the solar farm or
Liberty: Yeah. I think a lot of, um, financial people think of the grid as a financial thing. Like you add on one side,
Mark Nelson: It's a market! It's a commodity market for electrons!
No, it's
not. Electricity is not a commodity.
Liberty: it needs to balance out microsecond by microsecond everywhere, or like nobody has power, right?
Mark Nelson: Every physical spot in the grid must be in balance. you cannot, where there's demand, there must be that much supply. Where there's supply, there must be that much demand. And it has to be balanced within a tiny fraction of a percent of the strength of this electromagnetic field.
Liberty: you see big tech they keep building these massive gigawatt scale data centers. Going off grid, basically building a data center and a nuclear power plant and never connecting to the grid. Is there an advantage to that for them? Is it faster? Is it less regulation? Is this the way we're going
Mark Nelson: Until, these tech companies buy utilities, I don't think they're interested in being in the specialty business, a terrible business by the way, the specialty business of making power plants and providing their operation. The only reason they're getting closer to it is because they've found that Partly under their misdirection of the economy, their misdirection for marketing purposes that claimed that they were using renewables when they weren't, right?
Well, that misdirection has led it to where the grid is not prepared to move as fast as they need to move to not lose the lead on AI to either their competitors or to China. So, I don't think they want to jump all the way forward into buying and owning entire power plants and local grids, so for the time being, it will work better for all parties to do what happened in the Three Mile Island deal, in my opinion.
Which is that, it's not that they're building a data center to take a, you know, a zombie nuclear plant like Three Mile Island back to life and make it just, you know, connect only to a data center, because the data center will need to figure out what to do during refueling outages.
Liberty: Right.
Mark Nelson: 800 megawatts, which will be great to have, but Microsoft and Constellation realized it would be better for Microsoft to not be trapped alone with a, nuclear plant.
And the nuclear plant realized they should not be trapped alone with a single demand source for all of their nuclear power. Instead, let's think of this thing called a grid that connects large loads with large power plants. Isn't that brilliant? So we were told the grid isn't right and baseload is dead and it turns out the grid is exactly right and baseload is back more than anyone could have ever imagined.
Liberty: The best nuclear power plant in the world. still need to refuel once in a while. You need to refurbish every few decades there are huge advantages to the grid that as you say like we're all rediscovering What a marvel it is one of the best things our civilization has ever done And I think we've taken it for granted for a long time Especially as demand was kind of flat for a long time and now that's changing very rapidly Manufacturing, heat pumps, electric cars, everything is being put on the grid at the same time.
and AI is a thing that, didn't see coming.
Mark Nelson: AI is the thing that converted the world's richest companies from part of the problem? To part of the solution in terms of policy and politics of energy in my opinion.
Liberty: Speaking of that, that's the other big thing that's been going on that, for years, it didn't seem possible, and now, seems like every other day there's a new announcement, a new headline about, oh, this country is reconsidering their ban on nuclear power. This, government is running on this platform, right?
All of that seems to be changing very quickly. Do you think this is also all because of AI? Is it just a moment for nuclear right now? Is it good work that people have been putting in for years and a new generation that doesn't have the same baggage with nuclear power? How, why is this happening right
Mark Nelson: It's absolutely AI because the world's richest companies, were the ones pointing in the wrong direction on energy. Meaning any silly fool like me that was like, guys I think baseload's not dead, or guys I think in the future you're gonna have to put electric cars and heat pumps on the grid and you're gonna need more constant power.
We were considered Idiots, morons, luddites, because the world's biggest companies were lying about using renewables when they were actually using baseload on the grid. Now that they don't have enough power to keep up on AI without telling the truth on energy, they're starting to tell the truth on energy.
So I think that all of society, will benefit from the panic in the biggest tech companies that is forcing an internal, let's call it a reorganization, a purge, depending on how you want to call it. There are two wolves inside these tech companies. There's the marketing, legal, NGO non technical, smooth talker, social, butterflies, right?
They're the ones who enforced a no nuclear world and they were doing it in response to say board members and to the stock market or whatever you want to call it Whatever the big psychocultural thing was that kept nuclear out. It found a home in the energy as PR side of these big tech companies the engineering side that was above their pay grade because they always had the power they needed They just built the data center in Northern, Virginia Got the local nuclear power and then somebody in the marketing division would claim.
We're 100% You know, Arizona solar to power our, Virginia data center. All winter nights, right? Okay, so, what's happened is there's been a sudden education process for senior management at these companies and the, energy as public relations people are not being able to deliver it. Now, it's not like the energy as energy people are necessarily able to deliver it other than just, figuring out a way to get grey power from, uncategorized, uncertificated power on the grid from whoever can provide it, which ends up being A coal plant left on 10 more years, or a gas plant stood up in 3 years to meet new demand.
Like this is the grey power as the beautiful new wind farm out in rural Iowa, or the incredible new solar park in the Sonoran Desert, or whatever. doing its thing over there. But now the energy people whose job it is to deliver energy, not hot air, they're saying, uh, sir, we don't have that power for this data center.
We can't provide it. And, you know, I'm sure they had a moment where the top people are like, well, get more from wherever we've been getting it. We've been getting, you know, 5, 10 terawatt hours per year, and it's been 100 percent renewable. Isn't renewable cheap? Just get more of that. And they're like, well, sir, but we're getting the energy, but they won't sell us the capacity.
What's energy? What's capacity? And BING! Lightbulb comes on and suddenly the people at the top of these Wall Street darlings suddenly realize that the grid is real, that energy is physical, and it matters to get the truth and not the bullshit. I'm a little angry about this, but no better moment like the present to educate leaders of our economy how energy works.
Liberty: Speaking of angry, do you think there's hope now for Germany's plants?
Mark Nelson: Yes.
Yeah, well, see, the Germans elected a de-growther cult that said we can keep growing even with nuclear. Then the growth stopped and they were like, well, that's okay too. Because it was in their nature. That's what they, like, as the industries were dying, that was in the nature of the people that, the German people put in charge.
Or, you know, what, 18 20 percent of voters who voted for the Green Party that gave them the energy ministership that Green Parties inevitably take control of whenever they get added to a government. Because, remember, these Green Parties were not there originally for the environment, they were there to kill nuclear.
So, you have these Green Parties that came in in a pan European wave in 2020 when energy was easy. Heck, we have a surplus of energy in 2020. We've got COVID and everybody shuts things down. So we've got so much energy that life is easy. All you have to do is vote for the, we've got too much energy and should shut it down party. So then, Putin springs his little trap, turns off the gas, you know, triggers a war, and then somebody, you know, Locks it in place by blowing up Nord Stream. So you have that situation and who's in charge? The energy is evil and we shouldn't have it party is in charge of figuring out how much to pay to get all the energy back.
Liberty: And then they invest like something over 500 or 600 billion euros into, , Wind power and solar power. And I always wondered like how many nuclear power plants could you buy for that amount?
Mark Nelson: An enormous amount. Renewables are not particularly good fit for the European continent. On, just as a general statement. The European continent has a big north south climate gradient which would make you think, oh, no, that's good. You put solar panels down south and you put the wind up north. But. All of Europe is extremely far north.
And it's a billion people of moderate to high wealth, very far north. That means on average you have very lumpy, violent changes in what your energy is coming from through the season. Now, that's an incredibly fun opportunity for, uh, two bit grad student doing his PhD on some spaghetti code on Excel showing how, on average, if you take these weather models, you can see how you sort of have this right amount of energy over the year.
That's not saying you have enough physical capacity to balance an electromagnetic field that we call electricity from end to end on this massive continent, subjected to the political, uh, And cultural constraints, and of course physical constraints. Right, so what's happening is, Germany is meeting its power demands by not having the power demands, and by importing a lot of energy from other economies, and by just having degrowth, whereas the rest of Europe seems to still be growing. You asked me, do I have hope for the German plans? Yes. One of them has had not a single thing done to it, physically, to damage it. So, that one, I'm feeling good. And I visited that one, too. Last year it's in phenomenal shape and by all accounts it remains in phenomenal shape. And so that's, that's a plant that is newer than Three Mile Island.
It is almost double the capacity of Three Mile Island. It is undamaged, unlike Three Mile Island. I mean, Three Mile Island needs an estimated 1. 6 billion dollars to return it to operation. But, this nuclear plant in northern Germany needs almost nothing but a fresh batch of fuel.
Or, you know, you need to start ordering the fuel for future reloads. And it needs to hire a few new people and train a few operators. That's it. That's it. It's gonna cost a few tens of millions of euros. Maybe barely even 100 or 150.
Liberty: What about the other plants? Do you think they're, beyond recovery?
Mark Nelson: Yeah, well, we have a new metric, right? It's the Three Mile Island Scale. Three Mile Island is gonna be an estimated three and a half years and 1. 5 billion euros. To put into operation, okay? And if we have a 1.5 billion euros and three and a half or four years as our line for something worth doing if you're Microsoft in America, well, there's four or five nuclear plants in Germany that meet those standards.
Liberty: Hmm. Yeah. I think before they turned them off, they had something like 25 percent of their power grid coming from these plants. And they were some of the best running in the world, the highest capacity factors and all of that.
Mark Nelson: depends on what, plants you measure. Before they started the phase out, it was about that percentage. by the time they did that last brutal, mortal turn off of six nuclear plants in 18 months, it Which was, uh, really nuked the German economy along with the high gas prices. Those six final plants were among the finest on planet Earth, among the largest on planet Earth in terms of single reactors, and it represented about 12 percent of Germany's electricity generation at the time.
Now it would be a lot higher percentage because they've lost so much of their electricity generation. their economy demands less, and the amount of electricity that Germany produces for itself is far less. So German electricity consumption has fallen less than German electricity production.
It's just that Germany turned from a large exporter of power to a large importer of power.
Liberty: they turned back on some coal plants and like lot of it could have been
Mark Nelson: A little bit, but not many, not many. their emissions are crashing. They turned off nuclear and dropped their emissions, which, as long as you're part of the degrowther cult Sounds great it's even a good thing if you did that at the cost of the future of Germany.
Liberty: speaking of anger. That's, let's move countries before more anger comes out. But I'm curious about Taiwan. Is there hope for Taiwan too? It seems like TSMC needs so much power. Ukraine shown that, If anything happens, it's great to have some, homegrown power that someone else can turn off or blockade you for.
Do you think Taiwan could change policy there?
Mark Nelson: Yes, by all accounts they haven't damaged any of the units they've turned off. They're just off and sitting there.
Liberty: any signals from the government or any, anything like that yet?
Mark Nelson: In private conversation, according to trusted people, everyone knows that the nuclear plants are needed and nobody's willing to lead or act.
Liberty: Great.
Mark Nelson: Yeah, so I think there needs to be a little bit of leadership from America. I am not, I don't know how interested I am in the situation where Taiwan crashes its own grid and gets invaded, that one troubles me, it is without a doubt, a lot the US' fault.
I would argue at this point, knowing what I know about Taiwan's nuclear phase out the us. has always treated Taiwan, in my opinion, like not a country when it comes to nuclear, I mean, so Taiwan was, you know, according to international law, sort of illegally building a nuclear program, but are they a country or are they not?
Countries, you know, have certain obligations, I, so they were building a nuclear program at the height of their nuclear energy usage. Not with the same facilities, but, back in 1987 Taiwan was about 55 percent nuclear power. The KMT dictatorship was still in power, democracy didn't really exist, and they were using/misusing, depending on your, how long a historical view you take, they were misusing a, test reactor to breed material to use for a bomb program. One of their high ranking generals ratted them out to the U.S., and then we put enough pressure on, or just straight up sabotaged, their bomb program was destroyed. After that, there was democratic movement, there were people who went on hunger strikes to protest both government and nuclear at the same time, there were people who Came up as a generation fighting for the same freedom we have in America and Identifying the dictatorship and its prized nuclear energy program with tyranny nuclear was Tyranny to the democratic people who saw the government the government's nuclear program and the government suppression of, voting as all the same thing.
Liberty: seems to have. Happened so often everywhere, right? Kind of like Greenpeace and, anti weapons movement that becomes about also, peaceful energy.
Mark Nelson: we haven't gotten to Spain yet. Spain is the other country with 20 percent nuclear power where all the nuclear is supposed to be gone by law by like 2032, 2033. And you look at that situation and it's, well, the socialists and the green parties are against you know, General Franco's, nuclear program from the 70s.
So to be socialist, to turn off the, the country's golden goose, it's incomprehensible, except to realize that none of these people have any, Concept of how energy works or where it comes from and anybody like me who would say hey, don't turn off your nuclear That's bad. All they had to do is point to Apple, Facebook, Amazon, Microsoft and say well, they're 100 percent renewables.
Aren't we building the most renewables here in Spain? So that's why I think that this AI thing is so immense These companies may not even be able to get the energy they need, while calling for nuclear ends up saving entire countries from, destruction.
Liberty: it's incredible to think of how much infrastructure planning has been done by vibes and memes basically,
Mark Nelson: Yes, and then, this is the thing, the tech companies are changing up their memes. Now, don't get me wrong, there's still a lot of internal fighting in these companies that are like, Oh, we've done nuclear now, we've checked that box, can we get back to what we were doing before? In other words, they still don't understand, Why they were forced to do nuclear deals in the first place.
And so there's an internal struggle going on. If you hear the way a company like Amazon talks about why they chose the reactors they do, it's all this psycho babble about like safety and meltdowns and stuff. it doesn't have any real bearing on the way we operate a nuclear plant today.
But they still used it because there's still an internal fight over the vibes of nuclear. As far as I can tell, I'm not involved in the Amazon decision making. And I'm not even saying that the reactor they chose isn't a fascinating prototype to try out.
Liberty: Speaking of internal struggles, you posted on Twitter something about A publication by the Sierra Club that seems to kind of signal that they may be changing their mind on that. Is there any hope for any of these big NGOs been anti nuclear for so long to have a change of mind or is it baked in the DNA?
It's impossible. It's not going to be coming from them anytime soon. Like the donors demand it they're afraid of turning off the money spigot somehow or how do you see these big NGOs?
Mark Nelson: I think in part because of like all these sanctions on Russian money and the concern about Chinese influence and NGOs, there's going to be a lot more possibility for change than before. It wasn't like these NGOs were fighting the Chinese or the Russian nuclear program. Don't get me wrong. But, they were finding it very convenient to fight America's nuclear program and Europe's nuclear program, yeah?
So, what I think we're gonna see is what we've seen in groups like the NRDC. That's the Natural Resources Defense Council. the Natural Resources Defense Council emerged out of a fight to destroy The construction of a pumped storage hydro facility just north of New York City. during that fight, the people who were advocating against that pumped storage facility said, why don't you just build an equivalent amount of nuclear instead?
Just make a peaking nuclear plant. But then very quickly the anti nuclear movement, the MemePlex, took over and Natural Resources Defense Council emerged as a very powerful organization, agenda setting organization that was resolutely anti nuclear and based in New York City. So it was NRDC that helped lead the fight against Diablo Canyon in California and against Indian Point Nuclear Plant in New York.
Here's what happened. They, got a massive donation from Jeff Bezos a few years ago. I don't think he even knew or cared about electricity or electricity policy or any of that junk. No one, these people are, are yacht people. They don't care about how the grid works. Not really until it's suddenly put in front of them now.
But at the time, they could get a hundred million dollars for just being large enough to accept a hundred million. Yeah. And they were still fighting to close nuclear plants at the time. something happened, they lost the fight on Diablo, put up a little bit of resistance, and then finally all of their anti nuclear people apparently have been sacked, reassigned, gotten rid of late last year.
Liberty: Wow.
Mark Nelson: That's what I've been told. And I haven't seen anything about them about nuclear since, except for, some of these organizations stopped fighting nuclear plants and immediately put out an article saying we can't let our precious nuclear power be taken by data centers, that'll increase emissions. Whereas last year they said we don't need nuclear because it's not good enough for us. And now this year they're saying it's too good, we can't just waste it on data centers.
Liberty: we've always been at war with
Eurasia
Mark Nelson: East Asia, yeah, yeah, isn't that amazing? Okay, you ask, can these organizations change? Definitely. The result of that tweet of mine about Sierra Club, as I suspected, Is that the report got taken, off the website.
Liberty: Hmm. Okay. So still a struggle inside, least they seem to be, responding to incentives. And I'm sure they're also seeing the kind of vibe change. when Diablo Canyon was saved,
Mark Nelson: what was so backbreaking about Diablo is that there was the same politician that helped them organize the destruction of Diablo that changed his mind and organized his saving. What do you do? It's the same guy! Or how about in France, where Macron ran for election saying I'm going to tear down a bunch of nuclear plants and then he ran for re-election saying no, I'm going to build the same number.
Liberty: Well, I'll take it.
Mark Nelson: As long as they appoint people to execute on that new vision who do a good job executing on it, that's what I think I'd watch for and I think we're starting to see that.
Liberty: and then the other next step of the big thing. Is new build because at some point you run out of old plants that you can refurbish. we do this, right, how can we avoid the slow and expensive and like what everybody says about nuclear, right? It's like, Oh, look at Vogtle, you know, how long did it take?
How much did it cost? Let's build more solar panels instead. know we can build reactors, existing plants. That's probably like the first thing to do. if we want to do new build right, how would you think about it?
What would you recommend? What, what are the mistakes that we've made so far? In the West. Cause I know China is doing pretty well.
Mark Nelson: You know what? We could go into that with enough depth that I'm absolutely certain that along with some of the other topics, we should break that into a part 2.
Liberty: That'd be great. I'd love that. So Mark, thank you for joining me. Uh, we'll have to do a part two because there's still so much to talk about, but this was great as always, before you go join Thomas, son, If you had one thing for the listener of this to take away from this, from all this, what would it be?
Mark Nelson: vibes have shifted because the people who couldn't be bothered to pay attention to the destructiveness of their energy policies are now forced to take the lead in correcting them.
Liberty: Awesome. Thank you. And again in part two.
Mark Nelson: Thanks, Liberty. Good to join.
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