Nuclear startups pursue side profits from offshoot products

Why it matters: Building hundreds of nuclear power plants — including advanced fission and yet-to-actually-exist fusion — offers one of the most tantalizing ways to satisfy rapid power demand and combat climate change.

• But finding a way to fund their expensive and complicated roads to scaling is essential. Capitalism demands profits far sooner.

Driving the news: TerraPower, an advanced nuclear energy company founded nearly 20 years ago, is scaling up production of a key cancer drug ingredient — a medical isotope, or radioactive atoms used for medical diagnoses and treatment.

• It made the discovery nine years ago in what initially was a side project.
• It's going through drug trials now, with results expected in the next couple of years, said Chris Levesque, TerraPower's CEO, at an Axios event during Climate Week NYC last month.

"It's going to be a very lucrative business for us, and of course it fulfills our mission of helping people with nuclear technology," Levesque said.

• Proceeds from the isotope sales will "really help us offset some of the investment needed to build those first reactors while we're bringing down the cost curve," Levesque said.
• After initially targeting a 2028 start date of its first advanced nuclear reactor in Wyoming, TerraPower has pushed that to 2030 due to fuel shortages.

State of play: The offshoot business is even more prevalent in fusion. That's partly because it's a less-tapped innovation space and because its timelines are even longer than advanced fission.

• Several fusion startups are pursuing similar side revenue. They include TAE Technologies in power management and life sciences and Commonwealth Fusion Systems with high-temperature superconducting cable tech.

Zoom in: SHINE Technologies is among the most explicit in its messaging and strategy.

• It's pursuing a four-phase approach, in which the fourth is generating fusion electricity.
• Earlier phases make use of products stemming from an application of the fusion reaction that falls short of what's needed for electricity, but is sufficient in other sectors, ranging from medical isotopes to defense.

The intrigue: SHINE, which was formally founded in 2010 but whose work dates to 2005, was initially called SHINE Medical Technologies. "Medical" was dropped in 2021 to ease investors' confusion on whether it was primarily a medical company, its CEO, Greg Piefer, told Axios.

• "We're a fusion energy company. It feels more authentic to our true self," Piefer said. "We are just selling fusion to higher-paying customers than electricity."

By the numbers: Defense-sector customers — including jet engine and rocket manufacturers — pay SHINE as much as $200,000 per kilowatt hour of fusion energy.

• Piefer contrasted that with the average rate per kilowatt hour for equivalent heat that hovers around five cents (electricity is closer to 20 cents).

Reality check: These companies are — so far, anyway — expanding to include faster profit-making products.

• Sometimes, though, such expansions could become permanent pivots. It remains to be seen whether some of these firms move more entirely to these other lines if the primary nuclear business takes too long.
• "So far, the majority of our owners really like the energy play and feel this is a differentiated and smart approach to it," Piefer said. "Realities can change, market conditions change, and at some point, it could come to that: 'Alright, this fusion stuff [for electricity] is too hard.'
• "But right now, we are making awesome progress on the cost curve."

The other side: The promise of fusion, in particular, has been on the horizon for some time.

• Former Vice President Al Gore, now a cleantech investor, is warming up to fission energy thanks to its potential role in satisfying AI power demand. But he remains skeptical of fusion.
• "Fusion could eventually come online," he told Axios. With subtle sarcasm, Gore continued: "I had my first congressional hearing on fusion 45 years ago, and the experts on the panel said it's 50 years out. So, I'm getting excited."

Bottom line: No matter when — or if — advanced fission and fusion power plants are built, other things are already being achieved because of these endeavors.

• "As we make a big run at fusion as a society over the next decade, then there's likely to be a whole range of spinouts, many of which we don't understand at this point," said Andrew Holland, head of the four-year-old Fusion Industry Association.
• He compared it to the space race that originated civilian innovations from more computing power to new alloys.
• "We'll look back and realize how important it was," Holland predicted.