WBD557 Audio Transcription
Mining Bitcoin with Nuclear Energy with Ryan MacLeod
Release date: Wednesday 21st September
Note: the following is a transcription of my interview with Ryan McLeod. I have reviewed the transcription but if you find any mistakes, please feel free to email me. You can listen to the original recording here.
Ryan MacLeod is a Bitcoiner working in the reactor research and safety programs at Canadian Nuclear Labs. In this interview, we discuss the importance and safety of nuclear energy, and how Ryan is trying to orange pill the nuclear industry by showing how Bitcoin aids the economic case.
“Bitcoin mining can be plugged into the existing nuclear fleet as it and shore up the economics right now, because a lot of the reactors that are being shut down are because they’re not economically competitive on a grid that has a large share of wind and solar.”
— Ryan MacLeod
Interview Transcription
Peter McCormack: Ryan.
Ryan McLeod: Nice to meet you.
Peter McCormack: Nice to meet you, man. How are you?
Ryan McLeod: I am great.
Peter McCormack: Thanks for coming all the way to Bedford to do this interview.
Ryan McLeod: Yeah, it was quite the trip, my first time actually leaving Canada on an international flight, so that was quite exciting.
Peter McCormack: Yeah, Danny told me this yesterday; I was like, "What?!" You've never been on a plane before?
Ryan McLeod: No. I was very excited when you invited me here, so I was like, "Why not? Sounds like a cool adventure".
Peter McCormack: I've got so many questions on that; I won't spend too long on it. But the whole airport experience, it's just a natural experience when you've done it a lot and you've done it as a kid, but that was your first time, I guess, in an airport departure lounge?
Ryan McLeod: Yeah. Going through security wasn't as bad as I had anticipated. I work on a nuclear research site, so I go through security every day, so it's pretty much the same.
Peter McCormack: Was there any part of it that was a bit weird, you're like, "This is odd?"
Ryan McLeod: Just lots of people; it was just interesting watching all the people coming and going because I got there way in advance of when I needed to so I didn't have to deal with any of the hassle. So, I just got to hang out and just watched people mosey around.
Peter McCormack: How early were you at the airport?
Ryan McLeod: Like six hours; I was crazy early.
Peter McCormack: Rookie!
Ryan McLeod: But yeah, I didn't want to take the chance. I heard all the horror stories about Canadian airports right now, so I was like, "Just get there early, don't even worry about it".
Peter McCormack: That's airport rookie. So, what would you do if you were there six hours early, Danny?
Danny Knowles: Drink!
Peter McCormack: Did you drink?
Ryan McLeod: I had a few drinks, I went and had some food and then I just listened to some podcasts, reviewed my notes.
Danny Knowles: I think, if I got there six hours early, I think I'd be less likely to make my flight than if I got there two hours early.
Peter McCormack: Yeah, less likely to be allowed to get on your flight.
Danny Knowles: Yeah.
Peter McCormack: Danny's a lightweight. The first time taking off, what was that like?
Ryan McLeod: That was quite the rush.
Peter McCormack: It's wild, right?
Ryan McLeod: Oh yeah.
Peter McCormack: It's weird, because I've done it so many times I don't think about it; to then sit with somebody who's not been on a plane before it's quite the experience.
All right, man, anyway listen, thank you so much for coming all the way here. You can't be a bitcoiner without trying to spend some time understanding energy; it's a topic that comes up a lot for a number of reasons, but primarily because there is a FUD that comes out with regards to energy, or the use of energy, by bitcoiners.
Sometimes it's misleading and disingenuous or sometimes it's concerns over the growth in energy but, with that, we've all, well a lot of us, have spent some time trying to understand the energy market, particularly in Texas. A lot of us are aware of some of the projects that happened at ERCOT, but at the same time, I've also had Alex Epstein on my podcast discussing ideas with regards to energy and, if we were to curtail the use of fossil fuels, what the impact on humans would be. But I also had Andrew Dessler on the show talking about the issues with climate change and then the risks with that.
There seems to be a broad set of people with a broad set of opinions, some who don't believe climate change is an issue, or that we can mitigate it. But at the same time, with those who do understand there are issues with energy and energy production and climate, the topic that comes up a lot is nuclear, and I don't know enough about it.
Ryan McLeod: Yeah, nuclear's very exciting right now. When the cost of natural gas and oil is skyrocketing, that renews the attention on the nuclear sector which, in many places, hasn't been doing so well over the last few years. That's what triggered me to start talking about this; I was listening to the way that bitcoiners were talking about nuclear and they were seeing the perspective in the American nuclear industry where lots of reactors are being shut down and the industry is atrophying or supply chain isn't as robust as it used to be.
But then my perspective in Canada, from working at the research facility, I get an inside view of the progress of where we're going with small modular reactors and refurbishing our existing CANDU fleet; it's very exciting the potential that's growing throughout this decade to build a very wide range of different types of reactors to be deployed domestically, internationally. Canada is poised to be a world leader in this technology, like we have the full supply chain and we could kick ass really.
Peter McCormack: Good, oh right. Well, I've got a lot of questions; I want to know everything. I want to know how reactors work; I want to know about the risks. Before we get into that, let's do two things; firstly, can you just explain to everyone where it is you work, what it is specifically that you do and what it is the company you work for does?
Ryan McLeod: Yeah, I work at Canadian Nuclear Laboratories; that's Canada's premier nuclear research facility. It supports the entire CANDU fleet, does research on medical isotopes and various other peripheral technologies that can support the nuclear technology, like hydrogen production development and different thermal storage technologies. So, there's tons of research going on on all those fronts.
Specifically what I do, I'm a lab technologist and I operate a lab that supports the CANDU Pressure Tube Safety Surveillance Programme, just by analysing the hydrogen corrosion of the zirconium pressure tubes that are used in the CANDU reactors; because the heavy water corrodes the zirconium over the course of a few decades, and the risk of embrittlement can cause a potential issue.
I believe there was an incident that happened back in the 1970s in the Pickering Reactor where the moderator water leaked into the cooling water. It wasn't a major incident, but it was easily mitigated, and now that factor is constantly monitored. Every year the reactors shut down temporarily, take the samples, send them to our laboratory and then we tell me how much hydrogen is in the zirconium. They use those numbers to determine how much longer life the reactor pressure tubes have.
Peter McCormack: Amazing. How did you end up doing this?
Ryan McLeod: I was just educated as a chemical technologist and I had been laid off at the time and I just ended up getting a job at the nuclear labs. I just applied for a chemical position.
Peter McCormack: How big is the site; how many people work there?
Ryan McLeod: About 3,000.
Peter McCormack: That's not at the reactor, or is there a reactor there?
Ryan McLeod: There is a reactor but it was retired in 2018; that was the NRU Research Reactor that was built, I think, in 1947. So, there are a few other smaller research reactors on site that are used for various projects, but our future intent is to build one of the demonstration small modular reactors on our site. So, to get that ball rolling, we need to demonstrate the small modular reactors before they can go into wide commercial deployment.
Peter McCormack: Right, okay. I'm going to keep an eye on that because I want to come back to the smaller modular reactions. Also, just tell me your Bitcoin story; where did this all converge?
Ryan McLeod: Well, I had been aware of Bitcoin since fairly early on; I had watched various documentaries, like Zeitgeist, so learning about how money works and fractional-reserve banking, and you go down all those rabbit holes. Then, some of the content that I was interested in, occasionally Max Keiser would come up when he was evangelising way in the early days.
Then life moved on, I got caught up more with like culture war type of events and Gamergate and then all the craziness with Trump in America; it was just fascinating times to pay attention to. But then, yeah, I wasn't really paying much attention to Bitcoin, and I think it was just about four or five years ago I had a little bit of a money that I cashed out of an online poker site, and they had Bitcoin as an option, so I just cashed it out into a wallet and forgot about it. Then, when the price ran up last January, I started to take more of an interest when a few hundred dollars was now worth a few thousand dollars.
Peter McCormack: Oh yeah.
Ryan McLeod: Yeah, I jumped right back in and Max was my first touchpoint, so I went straight into the Orange Pill podcast, right off the deep end, and then was listening to him talking about guys like Michael Saylor, and then that led me to Breedlove's podcast and Saifedean's podcast. Then, it was when I had listened to two podcasts in quick succession with Steve Barbour and Adam O, where they were talking about what they were doing with flare gas, and then that developed a really strong interest in me in how the Bitcoin mining relates to energy infrastructure.
Then it was in March or so, when the price dumped because some, well, an eccentric billionaire that we don't need to even name was ranting about Bitcoin's energy use, and then the price dumped, and then she just randomly threw out this idea, it was like, "Well, we're going to build SMRs, like why don't we mine Bitcoin with SMRs? That sounds like a great idea". Then she just went about what she was doing and thought nothing of it. And then I just stood there, I was like, "Yeah, that's a really good idea. Someone needs to be promoting that", and then I started looking out in the community and nobody was promoting that, so I started to become the guy that was promoting that.
Then I jumped on Twitter by May and started pushing the idea out there and grow my influence and clout in the Bitcoin Twitter space, and start poking guys like Foss and Harry Sudock and just get their interest in the idea. Then it was in July, this North American Young Generation in Nuclear group that I'm a part of being in the nuclear industry, they proposed a competition called Innovation for Nuclear, which was coming up with ideas to support nuclear assisting in the UN sustainability development goals.
Nuclear, on its own, and the small modulars reactors have great potential to apply to all the UN sustainability goals, but then applying Bitcoin mining to the SMRs will significantly improve the economics of deploying these reactors which will, in turn, make them even better at applying to the UN sustainability goals.
Peter McCormack: And then you find yourself in Bedford making a podcast.
Ryan McLeod: Yeah. The first podcast, I got invited on to The Compass Podcast and then we did one with the full team, I think it was Young Professionals in Energy; that's hosted by Mark Hinaman. Then I did one with BTC Sessions, and then The Canadian Bitcoiners, and yeah, now I'm here in Bedford with you.
Peter McCormack: Amazing. Well, this is very cool. I'm really glad you're part of this Bitcoin community now, and now here showing your knowledge. As I said, I want to know everything; talk to me. How the hell does a nuclear reactor work; how does it make energy? Talk me through the physics of it all.
Ryan McLeod: It's just a giant boiler, it just takes advantage of the fact that when nuclear fission occurs, heavy molecules, like uranium or plutonium, break apart and release lots of energy, and then that's captured in various mediums, typically it's heavy water or light water; heavy water in the CANDU reactors, light water for most of the other boiled water reactors throughout the world. There's also molten salt, is one of the mediums; gas and graphite are two other options. It just runs that through a heat exchanger to generate steam, steam turns a turbine, turbine generates electricity.
Peter McCormack: It's very similar to hydropower in that it turns a turbine, right?
Ryan McLeod: Yeah, except you have to generate the steam first.
Peter McCormack: Yeah.
Ryan McLeod: Hydro's more just passive, using the flow of the river.
Peter McCormack: Right, but how does it actually work? Talk me through uranium; how does it get broken apart; how does that work?
Ryan McLeod: When uranium is configured in a specific orientation and then it's bombarded with neutrons, it will reach a criticality. So criticality basically means that it's generating more heat than is being consumed; it's releasing more neutrons than are being consumed. Then those neutrons will split and I think it's three neutrons will be released for each uranium that is broken apart and then, in order to maintain criticality, they need to keep that at one. So, they have moderators and it will absorb two out of those three neutrons, otherwise you could reach supercriticality, and that's bad because you don't want too much, because that's how --
Peter McCormack: Yeah, I'm trying to visualise when you're building it.
Ryan McLeod: I'm not a nuclear physicist myself, I'm just a chemical technologist, so I've been just going off the deep end, learning as much as I can for myself. But it's when uranium breaks apart, releases neutrons, and then those neutrons scatter and then break apart the next uranium, and then it just keeps cascading through the reactor. So, they have to absorb enough neutrons so that it doesn't go over critical, but then they have to make sure that they're not absorbing too many neutrons, that it stays at the right criticality level because, if it goes sub-critical, then it'll wind down and it won't sustain the fission reactions.
Peter McCormack: Right. Oh, so the criticality is like the reactions to keep going, keep happening?
Ryan McLeod: Yeah, you just want to find that sweet spot.
Peter McCormack: And what the hell's heavy water?
Ryan McLeod: Heavy water is just water that the hydrogen is deuterium. Deuterium is just hydrogen with a neutron on it, because standard hydrogen is just a proton and electron, but deuterium is a proton and a neutron with still the same electron. Then there's also tritium which has two neutrons, which is even less common occurring naturally, but it does get produced in the process of nuclear fission.
Peter McCormack: Why does it take so long to build these nuclear reactors?
Ryan McLeod: Because there's a robust regulatory environment that ensures that they are incredibly safe so that there is minimal risk of an accident. But adhering to those regulatory requirements requires a lot of upfront capital and a lot of licensing and environmental assessments, and those processes can take as much as ten years before a reactor can get greenlit.
Peter McCormack: Holy shit!
Ryan McLeod: Yeah. But, once you get over that hurdle, especially with SMRs that are going to be built in a fleet design, then you can just start pumping them out like mad. Like, you'll have specific geographies that you'll need to do environmental assessments, but once the licensing is done and all the regulatory requirements are overcome, then we just start building them.
Peter McCormack: Oh, so most of the regulatory requirements are for a specific design of a reactor?
Ryan McLeod: Yeah. So, right now, in Canada, I think there are 12 small modular reactor designs being proposed to come to market, and there are probably going to be 5 or 6 that get chosen at various sizes from 1 MW to 300 MW depending on the application, on-grid, heavy industry, or off-grid.
Peter McCormack: Is it individual companies pitch for the designs and then companies choose to take those designs and construct from them?
Ryan McLeod: Yeah. We've got GE Hitachi is working with the Darlington site; NuScale is working with the Pickering site; Moltex is working with the Point Lepreau site; we've got Global First Power is working with the CNL site. I believe there are more out there from like Arc Energy, X-energy, Terrestrial, StarCore, Westinghouse.
Peter McCormack: There are a lot.
Ryan McLeod: Yeah. So, at the moment there are only five, maybe six deals that have been announced, but there are probably going to be more. The first initial goal is to get the demonstration reactors built and then, once that's done, we can overcome that chicken-and-egg regulatory issue and start building them commercially and potentially for export as well.
Peter McCormack: So, the construction regulations, are they Canada-specific? I know there's the International Nuclear whatever it is; it is an international set of standards?
Ryan McLeod: Yeah, the International Atomic Energy Agency, they'd have international standards, and then Canada has the Canadian Nuclear Safety Committee; the CNSC is our domestic regulatory body. Pretty much the goal is to get it as standardised across the world as possible. Russia has their own regulatory bodies --
Peter McCormack: Can we laugh at that?!
Ryan McLeod: Yeah, the US has the NRC. Well, Rosatom actually, they have lots of customers lined up to get their reactors --
Peter McCormack: The Russian ones?
Ryan McLeod: Yeah. There are countries throughout Africa and the Middle East and Asia that are interested in nuclear; they don't really care what Russia's up to.
Peter McCormack: Well, we could talk about that separately.
Ryan McLeod: Yeah, that gets into complex geopolitical things.
Peter McCormack: Yeah.
Ryan McLeod: But they are definitely our competitor, because Russia and China are Canada's main competitors in the SMR game for international deployment.
Peter McCormack: Well, the SMR modules, when they're created and they're approved, will that wipe out any need to build these larger reactors; is that the death of those? Is the desire just to only have SMRs?
Ryan McLeod: Not necessarily, there's potentially room for all the different types. Like, the UAE's just built a few large reactors; Hinkley Point C is almost finished in the UK; I think there are the reactors in Georgia that have been taking a while, but they're almost finished.
Peter McCormack: Taking a while because…?
Ryan McLeod: 15 years.
Danny Knowles: When you say like the smaller reactors, what is the scale compared to a normal nuclear reactor?
Ryan McLeod: The term "small modular reactor" applies to reactors that are less than 300 MW. Conventional reactors are in like 600 MW, 700 MW units, and they benefit from the economies of scale, so they can have a wider customer base to share the risk of the costs with.
Peter McCormack: I have no idea what that amount of power, how many people that services. So, if you had one of these SMRs, how many would we need in the UK to serve 70 million people?
Ryan McLeod: Well it depends, because it would be locally dependant. The difference is you can build one large reactor and then all the transmission infrastructure to get it to the customers, or you can build the SMRs in hyper local grids.
Peter McCormack: Can you have a look at how much the UK grid uses? I guess you might have an idea of what the Canada grid uses; does Canada have a single grid?
Ryan McLeod: It's pretty spread over.
Peter McCormack: Yeah.
Ryan McLeod: As soon as you start getting further north, it gets pretty remote and there's a lot of off-grid that depends on diesel, and that's the goal of the SMR action plan for off-grid, is to get remote communities off of diesel and upgrade them to nuclear with the small modular reactors.
Peter McCormack: Okay, but I can't imagine the construction of a small modular reactor's going to be cheap; what's the estimated cost?
Ryan McLeod: The first-of-a-kind reactors are going to be in the orders of like, yeah, several hundreds of millions, a few billion; but the expected cost, once the technology is mature, the costs will be cut in half, because once the manufacturing facilities are built and all of the supply chains are developed and the expertise is aligned, that will significantly drive the cost down as more reactors are deployed. But yeah, getting it over those initial hurdles is going to be quite costly and require public, private risk sharing and capital investment.
Danny Knowles: So, it says Greater London uses just under 40,000 GWh, so it says it could be supplied by two or so large nuclear powerplants.
Peter McCormack: Okay, so that would be like four SMRs?
Ryan McLeod: Depends on the type of SMR; if you're going with the 300 MW unit then yeah, but if you want to apply it to a small community that only needs 15 MW to 20 MW, you can build either a few of the really small reactors that are going to be in the 10 MW range --
Peter McCormack: Oh, you can build tiny versions of these?
Ryan McLeod: Yeah, that's the plan; we want to build some that are in the 1 MW to 10 MW range, and then 50 MW to 150 MW range, and then the 200 MW to 300 MW range. So, we'll have a wide variety of applications that these reactors can be applied to.
Peter McCormack: So, the smaller ones, 1 MW to 10 MW, what kind of size geography do they need?
Ryan McLeod: Like a track field hockey arena.
Peter McCormack: Oh wow!
Ryan McLeod: Yeah, not much.
Peter McCormack: Okay, and do they know the construction time on something like that?
Ryan McLeod: They're expecting the smaller ones to be in the orders of like one to two years, and then the larger ones being like the five years ballpark.
Peter McCormack: So, it's really important to get through that regulatory process then?
Ryan McLeod: Absolutely.
Peter McCormack: Yeah, and are there enough people out there who are available to be able to work to construct these, to work at these? Is that another thing that has to be worked on, to train people up?
Ryan McLeod: Yeah, in many jurisdictions that is the case, that's why it has been so costly to build the Hinkley reactor and the Vogtle reactor in Georgia for the UK and the US markets, because they let their supply chain atrophy by not building or refurbishing any of the reactors for decades; whereas, in Canada, we are actively refurbishing our reactors right now. The Darlington has undergone refurbishment; the Point Lepreau reactor's undergone refurbishment; Bruce reactor is currently under refurbishment, so this will extend the life of those reactors for at least another four decades.
Peter McCormack: What's involved in refurbing it; is it essentially using the site to put in new technology?
Ryan McLeod: Yeah, a lot of the parts in these reactors are interchangeable; they can just be replaced with new parts. The pressure tubes just get replaced with fresh zirconium pressure tubes, and they replace the turbines if they need to, just anything that's starting to show its age just gets replaced; but the core of the reactor pretty much remains unchanged.
Peter McCormack: How much time goes into refurbing a reactor as opposed to building one from scratch?
Ryan McLeod: Each reactor probably takes like two to three years.
Peter McCormack: To refurb?
Ryan McLeod: Yeah.
Peter McCormack: Okay.
Ryan McLeod: And then it has the advantage of like sustaining our supply chain and our workforce and making sure that, yeah, the industry remains robust and doesn't lose our expertise.
Peter McCormack: So why has there been so much of a slowdown in the development of nuclear reactors, and essentially the decommission of reactors? We know Germany's been doing it, I think there's one in California, but we have less nuclear power now, right, than we did two, three decades ago; is that correct?
Ryan McLeod: I believe so, especially in the west, but then countries like the UAE, they went all out; they're building several, I think 4 GW or 5 GW worth of nuclear. I think just fired up the first one and there are three more set to go over the next three years, and they're working with the South Korean design.
Peter McCormack: Right. Can you have a look at how much power the UAE uses, because I'm wondering if four is enough to provide them all the energy they need?
Ryan McLeod: Well, I think these are like 700 MW, 800 MW units, and then they build them in -- like each reactor facility will have four units in one housing facility.
Danny Knowles: This is from 2013, it says electricity demand in the UAE has reached 105 billion KWh.
Peter McCormack: Right, I don’t know --
Danny Knowles: Those numbers just mean nothing to me.
Peter McCormack: Yeah, they mean nothing.
Ryan McLeod: It's hard to make sense of these numbers unless you're deeply entrenched in energy. They intend to overbuild their capacity, use it for like desalination operations, water treatment, chemical processes, hydrogen production. There are all kinds of high intense energy applications that nuclear is going to apply to, including Bitcoin mining.
Peter McCormack: Okay, so these sites are used for more than just the production of energy?
Ryan McLeod: They use the heat too, because instead of running the heat, the steam through a turbine, you can direct that heat into various chemical processes and use it for that and for various industries that use the new high-quality steam to run their operations.
Peter McCormack: Can you give me some examples of that?
Ryan McLeod: Like ammonia production, hydrogen production, just all kinds of synthetic fuels like methanal; there are going to be quite a few. Then it can also be used in like mineral refining processes, just mining in general. They want to use them for the oil sands in Alberta to get them off of natural gas, because they can provide both electricity and the steam to the oil sands' operations.
Peter McCormack: It's wild how for so long, there seems to have been this, I don't know, aversion to nuclear power, yet there's all this kind of amazing technology that's been developed to expand its use.
Ryan McLeod: Yeah, there's a very strong and well-funded anti-nuclear activists' lobby that has had a lot of momentum for the last few decades; they really ram home the Chernobyl and Fukushima as a reminder that nuclear power is bad. But there have been other chemical plant accidents and various incidences that dwarf the amount of devastation caused by the nuclear accidents. That explosion did happen in Beirut a few years ago; that was more devastating than all of the nuclear disasters combined.
Peter McCormack: Really?
Ryan McLeod: Yeah.
Peter McCormack: Well, I guess so, yeah.
Ryan McLeod: Thousands of people died in that.
Peter McCormack: Did they; thousands? Can you look that up?
Ryan McLeod: At least a few hundred, it was right in the middle of a port and a major city.
Peter McCormack: Yeah, I remember seeing it.
Ryan McLeod: It was just fertiliser that was left unattended for probably at least a few years, decades.
Peter McCormack: I remember seeing the footage of that; it was wild.
Danny Knowles: It says at least 218 deaths, 7,000 injuries.
Peter McCormack: Wow, and does it say the cost of the damage?
Danny Knowles: Property damage $15 billion plus.
Peter McCormack: Holy shit!
Ryan McLeod: Yeah.
Peter McCormack: In a country that cannot afford it. That's interesting because I heard recently that only one person died at Fukushima, and that’s been contested, and I can't remember the number for Chernobyl, but I've got a feeling it's like 24.
Ryan McLeod: Yeah, it's like a few dozen.
Danny Knowles: 28.
Ryan McLeod: Yeah, there are only a few dozen that can be directly attributed to radiation.
Peter McCormack: Actual deaths.
Ryan McLeod: Yeah.
Danny Knowles: Approximately 30, it says.
Peter McCormack: Approximately 30? I wonder if they're talking about people who died --
Danny Knowles: Immediately from the blast trauma?
Peter McCormack: Yeah, because there must have been an increase in cancer.
Danny Knowles: It says in the seconds to months after the disaster -- oh, actually this isn't it. It says 60, but I don't know how they even --
Peter McCormack: But even that, because if you didn't know, if somebody said you, "Danny, prior to all this, how many people do you think were killed as a result of Chernobyl?" I would have said, "Thousands".
Danny Knowles: Yeah, you'd guess at least --
Peter McCormack: I'd assume thousands got cancers and --
Ryan McLeod: Yeah, the way that it gets hyped up, that is a what a lot of people believe if they're not properly educated on the topic.
Peter McCormack: Well, with Chernobyl, what happened; what caused that? You can place accusations on Soviet Russia and, you know, incompetent management and processes, but what was the actual cause of the meltdown?
Ryan McLeod: I believe they were doing a test that required them to turn off some of their safety mechanisms. I think they were trying to see what would happen when they would just let the reactor wind down naturally. But from what I understand, there was a lot of stored energy in the graphite that's used to contain the reactor, and then something happened and then it created a steam explosion. Then, once the steam explosion blew out the reactor core, then that caused wider issues with releasing the radiation from inside of the reactor.
Peter McCormack: It could have been a lot worse though, right?
Ryan McLeod: Oh yeah.
Peter McCormack: We know of, is it the three guys who had to swim under and -- something was leaking? I don't know if I remember it from reading about it or it was from the -- not the documentary. Did you watch the Chernobyl series?
Ryan McLeod: I have not actually watched that one.
Peter McCormack: It's incredible, yeah, it's brilliant; it's well worth watching. But my understanding of Chernobyl is that it could have been a lot worse.
Ryan McLeod: Yes.
Peter McCormack: Whereas Fukushima's slightly different, in that it was more because of its location with regards to the earthquake.
Danny Knowles: It's also hard to quantify the cost of Chernobyl being basically a wasteland ever since.
Peter McCormack: Well, the immediate clean up and --
Ryan McLeod: What a lot of people actually don't know about Chernobyl is that there were two other reactors on that site that continued operating for another decade.
Peter McCormack: Really?
Ryan McLeod: Yeah.
Peter McCormack: I never knew that.
Ryan McLeod: Yeah, they kept them going, and now the area around Chernobyl is quite the robust wildlife preserve that's been doing quite well, from what I understand.
Danny Knowles: Three-eyed fish!
Ryan McLeod: Yeah, The Simpsons did not do a good job of promoting the nuclear industry.
Peter McCormack: But actually, that's something I was told is that --
Danny Knowles: That's what Harry Sudock said, wasn't it?
Peter McCormack: Yeah, Harry Sudock; was is Harry?
Danny Knowles: Yeah.
Peter McCormack: Harry said The Simpsons, it's been really bad for the nuclear industry.
Ryan McLeod: Because it had imaginary of Mr Burns storing barrels of green goo in a neighbourhood park and just crap like that. It just throws off people's perspective when they see like the green fuel rods; yeah, it's not like that at all.
Peter McCormack: So, we'll separate Chernobyl and Fukushima, with what happened at Chernobyl, what is the risk of a similar kind of meltdowns or its reactors now; are they so safe that it's almost impossible to happen?
Ryan McLeod: CANDU reactors are the safest design in the world from what I understand. They have a least three, I think four fail-safes that will result in them, if an incident were to happen, the reactor would be shut down and they would drop the moderator rods in and that would reduce the criticality of the reaction and slow down the production of neutrons. Or, if it was worse, they have a chemical poison that would be dropped into the reactor that would completely cease all reactivity within the reactor.
But the difference between those two applications is, if you just have to drop the moderator rods, that's an easily recoverable situation; whereas, if you have to completely poison the reactor chemistry, you have a very costly process of recovering from that.
Peter McCormack: Because…?
Ryan McLeod: Because the reactor chemistry needs to be reconfigured from scratch.
Peter McCormack: Right, so that's a last-case scenario?
Ryan McLeod: Yeah, but it's incredibly unlikely for that to even occur. These reactors are built with defence-in-depth for all their safety measures, that the likelihood of them even coming close to that situation is incredibly rare, but it's required to have that backup just in case that incredibly rare event were ever to happen.
In Fukushima, they did not expect to get hit by an earthquake and then a tsunami, and then had they had their backup generators at a higher elevation, they would have been able to sustain cooling power to the reactor that would have prevented the reactor from going critical and releasing radiation into the environment.
Peter McCormack: Yeah, so how does that actually happen; how does radiation get into the environment; what's gone wrong at that point?
Ryan McLeod: Well, it's mostly from the steam explosions because that just releases a lot of energy, but that steam is in the vicinity of nuclear material, fissile material, so it will carry with it the fissile material and then release that into the atmosphere, stuff like caesium and then tritium in the water.
Peter McCormack: But if radiation's so dangerous and it was released into the atmosphere at Fukushima and certainly at Chernobyl, are the risks of radiation overstated?
Ryan McLeod: They are. From the reactor accidents, the really dangerous nuclides that come out of an accident are very short-lived, so they're only dangerous for a very short time, like a few months to a few years.
Peter McCormack: I mean, I wouldn't say a few years is a short time.
Ryan McLeod: True, well relative to the grand scheme of things.
Danny Knowles: So, why have they stayed out of Chernobyl for so long?
Ryan McLeod: Just perspective or public perception, just everyone just scared of the situation, because it was very, very hyped up as a scary situation.
Peter McCormack: And they did build a massive iron dome to put over it, right?
Ryan McLeod: Yeah, that entombed it in a large -- they just dumped concrete in there and just --
Peter McCormack: Why did they do that?
Ryan McLeod: Just to contain it. Well, concrete has good moderating properties to absorb neutrons, so it really prevents any potential of a criticality accident from reoccurring if there is any radioactive fissile material still present at the site.
Peter McCormack: So, you would say then therefore nuclear, as a source for energy generation, is the safest or one of the safest?
Ryan McLeod: Per KWh generated? Yeah.
Peter McCormack: So, the lobbyists, the people who are against nuclear, try and put yourself in their shoes of their rational arguments, what are their rational arguments against nuclear?
Ryan McLeod: It's expensive, it takes a long time to build and, when there is an accident, it is incredibly sensational.
Peter McCormack: But expensive is a problem that can be solved through economies of scale.
Ryan McLeod: Yeah.
Peter McCormack: The length of time to create, I mean, if you want this source of energy you've got to start at some point, and again that would become more efficient over time, so I'm thinking more with regard to their concerns with regards to danger and the environment; so these people are uneducated?
Ryan McLeod: Some of the older reactor designs, their concerns were more founded, but as the technology has matured, they haven't really seemed to update to keep up with it, so they still repeat the same talking points that they did in the 1980s.
Peter McCormack: Which were…?
Ryan McLeod: Well, just it's dangerous, expensive, it takes forever to build.
Peter McCormack: But what is the danger in the old reactors?
Ryan McLeod: It's just that they don't fail into a safe state if something were to go wrong; they require active measures to shut down the reactor if it goes supercritical.
Danny Knowles: The other thing would be the waste, right?
Ryan McLeod: Yes, waste is the other issue, which it's not a large footprint that the waste takes up because of the huge density of uranium, the energy density, but we do have several proposed ideas of how to manage that waste, one of them being deep geological repository; they've started building one in Finland and there are proposals for various sites in Canada to build them as well.
They're limestone caverns that have the appropriate geography that water does not pass through at a very quick rate. These formations have existed already for tens of thousands of years, and they don't expect any changes in them for another tens of thousands of years. And, like I said, when fuel is pulled out of a reactor and it's radiated, the primary hazard is in the first few years when there are the more dangerous nuclides present.
Peter McCormack: So, the waste, is this the rods themselves once they've been fully used, or is there a green goo of some kind?
Ryan McLeod: No.
Peter McCormack: I wish there was a green goo.
Ryan McLeod: The most liquid radiological waste is the tritium that comes out of these; tritium is potentially going to be fuel for fusion reactors.
Peter McCormack: Okay, we'll come back to that, fusion reactors; stick with fission for the moment. So, is there more than one type of waste? There are the rods themselves, there's --
Ryan McLeod: There are the rods themselves, they are potentially fissile; they need to be stored in lead casks. When they're pulled out of the reactor, they're kept in large pools there to keep them cool while the harmful nuclides slowly decay. Then, once they reach a certain threshold where they're determined to be safe to handle, they get stored in lead casks.
Peter McCormack: Not drums?
Ryan McLeod: No.
Peter McCormack: There are no drums anywhere with nuclear waste? Maybe in Russia!
Ryan McLeod: There was a good podcast recently, Dr Chris Keefer on the Decouple podcast; he was talking with Mark Nelson about the deep geological repositories that are being built in Canada.
Peter McCormack: So, where are they currently stored?
Ryan McLeod: Most of them just remain on site, because they don't take up much space, but the plan is to move them into the repositories once the facilities are built, but then that's another chicken-and-egg thing; you've got to go through all the licensing and regulatory and there has to be community buy-in from the communities that these things are going to be hosted in. One is being proposed in the Bruce Peninsula near the Bruce reactor, and another, more further out in Northern Ontario, in Ignace.
Peter McCormack: I'm going to make Jeremy proud now, because they covered this in The Fifth Risk; have you heard of the book, The Fifth Risk?
Ryan McLeod: No.
Peter McCormack: It's a book I read a while back which I seem to bring up in every show after that point, but they talked about the differences between the US and Russia and how they deal with spent fusion materials. I think they talked, in Russia, they just pour concrete over it, but there are certain regulations, for example, in the US, with regard to how it's stored and where it's stored. But they also talked about the amount of -- I want to say something like all the nuclear waste in the world that's ever been created would be smaller than a football field or something.
Ryan McLeod: Well, like one football field stacked two telephone poles high.
Peter McCormack: That's about it; I think that's about what I heard. But if we were to increase the number of reactors, that would go up, so we would need some --
Ryan McLeod: Potentially, but the beauty of some of these new reactors is that some of them will be able to use that reprocessed fuel as their fuel to operate.
Peter McCormack: So, you can reuse; how can you reuse it?
Ryan McLeod: The conventional reactors only get about 5%, maybe 10% of the available energy out of the uranium in the fuel rods because of their designs, and then they want to use a process called pryoprocessing, where they dissolve the spent fuel rods into a molten salt and then use an electrolytic process to purify it to just the fissile material that's required for a generating reactor. Then that will be able to get, potentially, another 70% to 80%, maybe 90% of the energy out of this spent fuel, and then that will reduce them to a lot safer nuclides that aren't as long-lived and mostly inert salts that can be stored safely like any other industrial output.
Peter McCormack: And the water, the heavy water, tritium did you call it?
Ryan McLeod: Well, heavy water is proton and a neutron; tritium is proton, two neutrons.
Peter McCormack: But the waste water, does that have to be stored in lead caskets or can you put that in a drum?
Ryan McLeod: Well, that gets stored in drums and then it gets --
Peter McCormack: There's our drums!
Ryan McLeod: Yes, that'll be stored in drums.
Peter McCormack: And is it green goo?
Ryan McLeod: No, it's just water.
Peter McCormack: For fuck's sake!
Ryan McLeod: You won't even know.
Peter McCormack: They should add green to it.
Ryan McLeod: And honestly, t's not as harmful as people are led to believe. If you accidentally consumed tritium, the solution is buy a case of beer and take a leak; it'll just flow.
Peter McCormack: Really?
Ryan McLeod: Yeah.
Peter McCormack: Shall we do it?
Ryan McLeod: I don't recommend it, but in incidents where it has happened, it flows through your body so quickly that you just have to overhydrate yourself and just flush it out.
Peter McCormack: With beer? Beer is never known to hydrate myself.
Ryan McLeod: Well, beer, water, just something that's going to make you pee.
Peter McCormack: Okay; whiskey?
Ryan McLeod: Yeah.
Peter McCormack: Fucked out with whiskey!
Ryan McLeod: Just flush it through your system as quickly as possible.
Peter McCormack: Okay. So, everything you're explaining to me is like, "Well, this is just a no brainer". Is there enough uranium in world; where the hell do we get uranium from?
Ryan McLeod: There are tons of uranium. Canada is the second largest uranium exporter in the world; then Russia has some uranium; there's uranium mines in Kazakhstan. I don't know if Australia's mines are still operating, because they're in a weird state with their nuclear industry.
Peter McCormack: They just elected a green party, didn't they?
Danny Knowles: Not the Greens.
Peter McCormack: No, but a very green -- they campaigned on green issues, didn't they?
Danny Knowles: Well, the Great Barrier Reef's the big problem there because it's dying, so that’s like such a buzzword for anyone in Australia.
Peter McCormack: Isn't that bleaching?
Danny Knowles: Yes.
Peter McCormack: Is that from sunlight?
Danny Knowles: It's the water getting too hot, I think.
Peter McCormack: The water's getting too hot; how are they going to cool down the water?
Danny Knowles: Well, that's a good question! You can also do things like plant coral that helps it grows back and stuff.
Ryan McLeod: There was a report that came out recently that was saying that the Great Barrier Reef has made quite a resurgence recently.
Peter McCormack: Is that true?
Danny Knowles: It could well be. I mean, they have processes in place where they can try and rebuild it, but I've been and it's pretty white.
Peter McCormack: Oh, really? Have you dived in it?
Danny Knowles: Yeah.
Peter McCormack: Have you been to the bits that aren't white?
Danny Knowles: I don't know, it's huge, and I don't know where's good and where's bad.
Peter McCormack: Was it good where you went?
Danny Knowles: The fish were good but the coral wasn't; it was pretty white.
Peter McCormack: What is it normally, just like a plethora of colours?
Danny Knowles: Yeah, I mean you don't see all the colours that well through your human eyes because it doesn't go through the water very well or something, but where I was it was very white.
Peter McCormack: Right, and that's a massive issue for Australians?
Danny Knowles: Well, yeah, I mean it's a landmark, a massive landmark, isn't it?
Peter McCormack: But it's interesting that you can win an election with that as one of the primary things.
Danny Knowles: Well, I think if you ran on green in the UK or in the US, as in green policies, you'd also probably do pretty well.
Peter McCormack: Yeah, I don't know, not as well. Okay, so with regard to the actual industry and the production, how much work is there; how competitive is it between different companies that want to build them, or is there a lot of collaboration?
Ryan McLeod: It's a mixed bag. Historically, yeah, nuclear utilities are in competition with each other to get the access to market share, but now it seems that there's a lot more collaboration, mostly surrounding the climate change mitigation and everyone is on the same team in regards to doing what they can for that.
Peter McCormack: Not everyone.
Ryan McLeod: No, not everyone, we get into arguments with wind and solar people all the time because they think that we can power the entire world with 100% wind and solar, which I think is insane.
Peter McCormack: Yeah, I think that's pretty obvious now going down that rabbit hole; it's become kind of obvious that it can't.
Ryan McLeod: As soon as wind and solar start penetrating 15% to 20% in a grid, it starts to have serious negative cost effects, because they overproduce when you don't need them to and, without massive storage capabilities, they aren't feasible.
Peter McCormack: That's where the miners come in, buddy.
Ryan McLeod: Yeah, that is where the miners come in.
Peter McCormack: So, if you were to consider a kind of grid, a perfect kind of grid scenario, do you think there's a role for wind and solar or is there no role?
Ryan McLeod: It's geographically dependant.
Peter McCormack: Okay.
Ryan McLeod: Like in Northern Canada, building solar panels is pretty much useless, but wind is applicable.
Peter McCormack: I heard a story while I was in Canada, and I met a guy who works up on one of the oil places where they go and mine the oil, and his job is to go out and do repairs. But he said, during the coldest parts of winter, you can't go outside for more than half an hour, because your eyelids freeze over; was he just scaring me or is that true?
Ryan McLeod: Oh no, that's legit; as soon as you start getting up in like Northern Manitoba, Saskatchewan, Alberta, it gets cold at the peak of winter, like minus-50 type of cold.
Peter McCormack: Holy shit! Have you been there?
Ryan McLeod: No. Where I am, our coldest will touch minus-40 on some days, but it's mostly in the mid-20s.
Peter McCormack: Is Trudeau pro nuclear, because he seems to have some quite weird policy ideas?
Ryan McLeod: He's very much leaning more towards the green technologies, especially the Environment Minister in Canada. He's more towards the wind, solar, renewable types; he's not a big fan of nuclear. But then the Labour Minister is a big fan of nuclear, because it supports a lot of union jobs and workforce in Canada.
Peter McCormack: And the general population, the voting public, are they pro nuclear?
Ryan McLeod: It depends who you ask and where. There are people in Ontario that are familiar with the nuclear grid, are very much pro-nuclear, New Brunswick as well; but then you start going out to BC and they're not big fans of nuclear, so it's a mixed bag across the board.
Peter McCormack: Do you know what percentage of energy is nuclear in Canada? Danny got me, here, it's like 4.3% of global energy demand is provided by nuclear. I was surprised; that was lower than I expected. Has it been higher; has it come down?
Danny Knowles: I'll have a look.
Ryan McLeod: I'm not sure. In Canada, for the entire country, I think it's like 16%, 17%, but then in Ontario specifically it's like 60%. Ontario's pretty much hydro, nuclear and then a little bit of natural gas. They used to have significant coal but then that was phased out about a decade ago, and the only way that they were able to do that was the massive nuclear assets that we have in Ontario.
Danny Knowles: There's actually a bit of a conflict here; it says here on this website that nuclear energy now provides about 10% of the world's electricity.
Peter McCormack: Okay, well what's the source?
Danny Knowles: That's from worldnuclear.org.
Peter McCormack: Worldnuclear.org, okay. Okay, talk to me about fusion because I am sometimes a bit of a nerd and read geeky magazines like Focus or New Scientist. I was recently reading in New Scientist about fusion reactors and that significant progress is starting to be made on these, and then it said, "We expect the first reactor to come online in 2056", and I was like, "I probably won't even be alive".
Ryan McLeod: Yeah, it's a long timeline to get fusion to a commercially deployable state; right now, it's still in just demonstrating with the -- I forget the name of that large fusion reactor that they're building I think in France.
Peter McCormack: Yeah, that's France, yeah.
Ryan McLeod: They just recently achieved the point of producing more electricity and heat than was used to sustain the reaction.
Danny Knowles: Your scarf's getting in the way of this TV.
Peter McCormack: It's a good scarf, man.
Danny Knowles: Is this the one?
Peter McCormack: The International Thermonuclear Experimental Reactor, yeah, facility in Southern France; this is the one I was reading about. Sometimes I don't like Wikipedia as a source, because they give you too much information.
Danny Knowles: Yeah.
Peter McCormack: Can you look it up on like Google News?
Ryan McLeod: Oh yes, the Tokamak; that's the type of design that that is.
Peter McCormack: Tokamak; what does that mean?
Ryan McLeod: That's just the name that they gave it.
Peter McCormack: Yeah, so how does fusion work; how is that different from fission because my understanding is that there's no waste?
Ryan McLeod: Because the process of fission is breaking apart heavy elements, like uranium, plutonium; whereas the process of fusion is combining small light elements, like hydrogen, and that's the process that's occurring in the Sun, and then it combines them and forms helium, but when that happens, that releases a massive amount of energy.
Peter McCormack: Have you found anything on this?
Danny Knowles: Yeah.
Peter McCormack: Okay, "European scientists say they have made a major breakthrough in their quest to develop practical nuclear fusion, the energy process that powers the stars". They should have said the Sun, come on. "The UK-based JET laboratory has smashed its own world record for the amount of energy it can extract by squeezing together two forms of hydrogen. If nuclear fusion can be successfully recreated on Earth, it holds the potential to supply virtually unlimited supplies of low-carbon, low-radiation energy. The experiments produced 59 MJ of energy over 5 seconds". What's 59 MJ; is that like power of light?
Ryan McLeod: That's quite a bit of electricity, but yeah, only for five seconds, so they weren't able to sustain it for very long. 11 MW, that’s --
Peter McCormack: Right, and, "This is more than double what was achieved in a similar test back in 1997", 25 years ago, geez! "It's not a massive energy output, enough to boil about 60 kettles' worth of water, but the significance is that it validates design choices that have been made for an even bigger fusion reactor now being constructed in France. 'The JET experiments put us a step closer to fusion power', said Dr Joe Milnes, the Head of Operations at the reactor lab. 'We've demonstrated that we can create a mini star'"; that's fucking cool. "'We can create a mini star inside of our machine and hold it there for five seconds and get performance which really takes us into a new realm'".
Okay, so this is how it works, hydrogen atoms are heated, fusion reaction, helium, neutron and energy released, neutron energy heats water; it's pretty cool, it seems pretty simple.
Ryan McLeod: Yeah, the biggest obstacle is containment, because it's a lot of energy and a lot of heat, so it requires like a magnetic field to contain it in a sustained way, because the material requirements to contain that sort of heat are going to require some breakthroughs in order to make this feasible.
Peter McCormack: It creates like a plasma, right?
Ryan McLeod: Yeah.
Peter McCormack: The fourth state.
Ryan McLeod: Yeah.
Peter McCormack: That’s cool though.
Ryan McLeod: It's very cool, and it's going to be cool when it's done, but that's still many, many decades away.
Peter McCormack: Let's bring it now back to Bitcoin. What is the connection for you in this; why does this make it interesting for you?
Ryan McLeod: Well, because nuclear reactors are optimal economics when they can run at full capacity, at their maximum capacity factor, and when they aren't, when they don't have the demand to justify that, the economics don't really justify building nuclear reactors. If you're running it at half capacity, the economics just don't make sense.
Peter McCormack: Because of the operational costs?
Ryan McLeod: Yeah, well it's mostly the initial capital expenditure and the cost of capital; that is the biggest economic issue when building reactors.
Peter McCormack: Once it's built, what are your input costs? I guess staff and running --
Ryan McLeod: Yes, just operational maintenance and fuel.
Peter McCormack: Is fuel expensive; is the uranium expensive?
Ryan McLeod: Relative to the cost of the reactor, not really.
Peter McCormack: So, the majority of the cost is the upfront cost?
Ryan McLeod: Absolutely.
Peter McCormack: Whereas I would guess something like natural gas and coal, you actually have a much higher percentage of your cost is the cost of the actual material.
Ryan McLeod: Yeah, especially when they're highly variable markets.
Peter McCormack: Yeah, and so the price of energy from nuclear is a lot more stable?
Ryan McLeod: Yes.
Peter McCormack: So, is the option here with mining is that it's going to offset the capital outlay?
Ryan McLeod: Yeah, it'll offset a lot of the economic liabilities that reactors are subject to. Like, when they're over-generating, either they just curtail it and earn nothing for it, or they pay other jurisdictions to take the electricity away. So, if they were to plug in Bitcoin miners to capture that, they could turn a liability into a revenue stream.
Right now, in a regulated grid like Ontario, the reactors are paid, they get I think 8.7 cents per kWh regardless of what the market cost of electricity is and the demand is. So, when they have to curtail or sell at negative prices, that ends up getting put on the taxpayer, because it's government subsidised.
Danny Knowles: It was interesting what you were saying about New York last night.
Ryan McLeod: Yeah, because one of the reasons that New York was able to get away with shutting down Indian Point is because they buy lots of electricity from Ontario and Quebec.
Peter McCormack: Really?
Ryan McLeod: Yeah. Well, Quebec, a few decades ago, they overbuilt the crap out of their hydroelectric infrastructure, and that's part of the economic profiles that they sell that to some of the Northeastern states, Maine, New Hampshire.
Peter McCormack: I didn't know about that at all. New York's really weird with some of their policy decisions; they seem to be anti-everything.
Ryan McLeod: Yeah, it's interesting because every jurisdiction has different political and social issues that they are concerned with, so it depends on your political leaning really.
Peter McCormack: So, my one concern with Bitcoin miners supporting energy grids is that there's a limitation to how many different nuclear plants and grids that Bitcoin mining can support, because we can't have infinite Bitcoin mining. So, the more people that do it, the more competitive it becomes and the less Bitcoin they will generate from those operations.
Ryan McLeod: But that's the game theory though. If an industry like nuclear were to go deep into Bitcoin mining, that would make the Bitcoin mining network even more robust.
Peter McCormack: That's saying security leads price.
Ryan McLeod: Well potentially, but it's just as more people have confidence in the reliability of the Bitcoin networks, then the price potentially goes up as demand goes up; and seeing more legitimate industries taking it seriously will give that sort of confidence that will drive demand potentially. A lot of it is just playing into the game theory ideas; it's going to be hypercompetitive, but then that will drive more adoption on both fronts, on mining and just Bitcoin in general.
Peter McCormack: The nuclear community that you're part of, how aware are they of Bitcoin mining; is it a growing topic?
Ryan McLeod: The people that I talk to, they have no idea until I bring it up to them.
Peter McCormack: What, are they like, "What the fuck are you on about, you crazy man?"
Ryan McLeod: Pretty much, yeah. I brought up Bitcoin mining to the CEO of my company and he was like, "What, like you mine Bitcoin with shovels like typical mining?" I was like, "No, no", so there was bit of explaining to lead him down that path.
Peter McCormack: Did you listen to my show with Adam Wright about when they were going to do mining from the methane that's extracted from refuse sites, like the dumps?
Ryan McLeod: Yeah, that's awesome.
Peter McCormack: But did you hear what he said about the guy who said -- so he was talking about putting Bitcoin miners there, and he said, "How do you know there's Bitcoin in these dumps?" So, is there a bite from your boss?
Ryan McLeod: They've got somewhat of an interest, like when you tell them that you can set a floor on the cost of energy, they definitely perk up and are like, "Well, how does this work; what do we have to do with that?"
Peter McCormack: "Tell me more about this".
Ryan McLeod: Yeah.
Peter McCormack: I want to go to a nuclear site.
Ryan McLeod: You just plug in; we're just plugging in computers and consuming excess electricity, and it's a completely independent market from your local grid that you can sell electricity to.
Peter McCormack: And it spits out magic internet money.
Ryan McLeod: Yeah, it's a money printer.
Peter McCormack: Bitcoin printer. So, what else is coming in this kind of area? It all sounds really exciting, but then I feel like we're going to be waiting 10, 20 years to actually see anything.
Ryan McLeod: Well potentially, Bitcoin mining can be plugged into the existing nuclear fleet as it is and shore up the economics right now, because a lot of the reactors that are being shut down are because they're not economically competitive on a grid that has a large share of wind and solar, because they then tend to operate at a low capacity when there are other intermittent sources providing electricity to these grids.
Danny Knowles: That's quite interesting because, really, we need wind and solar and nuclear to all, sort of, coexist.
Ryan McLeod: Yeah, but you need something flexible that can manage that surplus; that's where I think the Bitcoin mining can come in. There are all kinds of other -- like, the chemical operations that I described earlier, like hydrogen production, desalination, those I see as more secondary industries to come in after Bitcoin mining.
Think of it like Brandon Quittem's the Pioneer Species idea; the Bitcoin comes in as the pioneer, seeds the energy resource and then, as more sophisticated energy buyers come into that market, they will push out the Bitcoin miners and then they'll be redeployed elsewhere to other projects.
Peter McCormack: Desalination's interesting because my understanding of desalination is it's just so expensive.
Ryan McLeod: Because it takes a buttload of energy, but if you've got nuclear reactors that produce both electricity and heat, they are the optimal technology to ramp up desalination technology.
Peter McCormack: Talk to me about the economics and financing of this; how does it all work; is that the biggest roadblock?
Ryan McLeod: Pretty much, because the cost of capital is incredibly expensive when you have 90% of your cost of building these things coming before they're even built.
Peter McCormack: Right. How are they currently financed?
Ryan McLeod: Public, private partnerships between governments and whatever private industry is interested in the technology.
Peter McCormack: I know that was a big issue with Hinkley. Danny, can you look up how Hinkley was funded?
Danny Knowles: Yeah.
Peter McCormack: I know that was a massive issue with that.
Ryan McLeod: Yeah, half of the cost of capital on Hinkley, from what I understand, is just the interest on the initial investment.
Peter McCormack: Oh, crap!
Ryan McLeod: Yeah. So, if we can have some way to drive down the timeline on the return of investment, that will significantly improve the capital requirements for these reactors, because you'll recover that capital a lot faster so you'll be paying interest for less duration.
Peter McCormack: Is that what Bitcoin does?
Ryan McLeod: That is what I'm hoping how Bitcoin fits into this.
Danny Knowles: It says here that, "Building Britain's first nuclear reactor since 1995 will cost twice as much as the 2012 Olympics".
Peter McCormack: What?! How much?
Danny Knowles: £20.3 billion at present.
Peter McCormack: I kind of think I'd rather have a couple more Olympics!
Ryan McLeod: Well, a lot of that comes down to the workforce was not maintained over the last few decades, so all that's got to be completely reinvigorated from scratch; you've got to rebuild your supply chains, you have to get the technology rolling again; whereas, in Canada, where we have all the refurbishment plans, that's how we've sustained our workforce and supply chains.
Peter McCormack: Oh, here we go, "To pay for it, the British government has entered into a complex financial agreement with Électricité de France (EDF), the energy giant that is 83% owned by the French government, and China General Nuclear Power Group, a state-run Chinese energy company. Under this contract, British electricity consumers will pay billions over a 35-year period. According to Gérard, 'We cannot be sure that in 2060 or 2065, British pensioners, who are currently at school, will not still be paying for the advancement of the nuclear industry in France'". I mean, it just sounds --
Danny Knowles: I mean, this is through The Guardian too, who are probably anti-nuclear, I'm guessing.
Peter McCormack: Yeah, that's it, that's a fair point. We also have an ability in the UK to make everything significantly more expensive than it should be, and the final product is usually shitter. I don't know why we're so good at it, but we spend so much on our trains and our trains are shit; it must be our way, Danny.
Danny Knowles: Yeah. Ryan, you wanted talk through this I think before the show.
Ryan McLeod: Well, yeah, that's just the general plan for the SMR action plan, with what the intention is and where they want to apply the small modular reactors for heavy industry, oil sands, remote communities, replacing coal plants. And so, there's a lot of potential for a lot of revenue in these, but my take is that if we include Bitcoin mining on this, we can improve these timelines, we can replace a lot more diesel generators, because the North is just plagued with costly energy in some places where they have to fly in diesel; they have as much 90 cents kWh for their electricity, which is insane.
Peter McCormack: Wow!
Ryan McLeod: And a lot of that gets subsidiarised, so then those subsidies that could be going to other community development projects are just going to this blackhole of just making sure that they have energy that they can afford.
Peter McCormack: Yeah, so Danny's just brought up a slide; what's this slide called, Danny?
Danny Knowles: Where is this actually from, Ryan?
Ryan McLeod: This is from the Economics and Finance Working Group on the SMR Roadmap. So, I highly recommend anybody that's interested in this stuff to read the SMR Roadmap; it's a good 80 pages for each of the documents, but it's well worth getting a good lay of the land as to what's going on, the different community engagement that's going on.
Throughout Northern Canada, there has to be very strong engagement with the indigenous communities because they're going to be the ones that are going to benefit from these. But we need to make sure that they are content with the way that we're going about it, which requires significant communication and reciprocal benefits.
Peter McCormack: Yeah, so this is the macroeconomic, what does it say, action plan, Danny, on benefits, and there's a domestic market. So, "SMRs meeting a fraction of the potential can provide significant economic benefits for Canada, including up to 6,000 direct and indirect jobs per year between 2030 and 2040, and up to $10 billion in direct impacts and $9 billion in annual indirect impacts over the same timeframe. These are conservative estimates that do not take into account potential future uses of SMRs, such as powering greenhouses, desalination, and hydrogen production, all of which could increase the overall economic potential". So, is there a lot of work that has to go into lobby to actually have this happen?
Ryan McLeod: Yeah, and right now, they're trying to update all the regulatory requirements to reflect the new SMRs because they are a lot safer and they're going to be smaller, so it's going to require different regulations than the old reactors. But we have the chicken-and-egg problem of we have to demonstrate these things, and prove what they're claiming before we can really establish that regulatory framework.
Peter McCormack: You need a prototype.
Ryan McLeod: Yes. So, that's where we're building at the various existing licensed nuclear facilities in Canada, at Canadian Nuclear Labs, at Darlington, Pickering, Bruce, Point Lepreau, and potentially a few other sites may be chosen for demonstration reactors.
My hope is that when they do build these demonstration reactors, they want to develop what's called the CEDIR part, the Clean Energy Demonstration Innovation and Research facilities, where they're going to bring in peripheral technologies that will benefit from nuclear, so like all the ones that were just listed there, like hydrogen, desalination, greenhouses. My goal is to have Bitcoin mining included in that as well to show off the economic benefits of having a price floor on your electricity.
Peter McCormack: It's pretty rad.
Ryan McLeod: That's my hope, because my hope is that by including Bitcoin mining, we can deploy these reactors bigger and more and come up a lot more deployment scenarios where it would not have made sense otherwise, because you don't potentially have the customers that you need to sell that electricity to right away, but if you have the Bitcoin miners, you have them available the moment that a reactor begins generating electricity.
Then, over time, you develop the transmission infrastructure to get wherever you need it to go, or you build the remote mine that's going to be built on that site. Then you can either redeploy the Bitcoin miners or you can set them up in such a way that they can scale up and down with the day-to-day variability of the local demands.
It's a pretty big idea with all kinds of crazy game theory to it, because it's just we need to get the right people to pay attention to this technology. Then, once they start building it and then it becomes hypercompetitive, I'm hoping that as Bitcoin miners in ASICs become more commoditised, as we're starting to see, that there are less and less efficiency gains for each successive generation of ASIC, that it'll standardise throughout the industry. It'll be easier for these industries, like nuclear, to adapt it into their strategies as well.
Peter McCormack: Well, I find the whole thing fascinating. If people want to read more about this or speak to you, how do they do that?
Ryan McLeod: Well, on Twitter, I go by @nuclearbitcoinr.
Peter McCormack: A hell of a name.
Ryan McLeod: Yeah. The SMR Roadmap is a good place to learn about what we're doing in Canada, and then, if you want to go into some nuclear podcasts, there's the Decouple podcast, there's Titans of Nuclear.
Peter McCormack: The Titans of Nuclear?
Ryan McLeod: Titans of Nuclear, yeah.
Peter McCormack: That sounds like my nuclear podcast!
Ryan McLeod: Yeah, that's Bret Kugelmass, and then there's another one, forgetting --
Peter McCormack: Well, we'll find it.
Ryan McLeod: Yeah.
Peter McCormack: We'll stick it on the show notes.
Ryan McLeod: Yeah, I'm slipping on the name of it.
Peter McCormack: Well, listen, I'm really grateful that you came in, that you've been educating us on this; I find the subject fascinating and want to know more. I find fusion super fascinating; it's just a shame it won't probably happen before I get to see it.
Ryan McLeod: Yeah, and Bitcoin mining's going to supercharge the whole thing, well, at least my hope.
Peter McCormack: It is. All right, man, well listen, appreciate you coming in. Thank you for doing this.
Ryan McLeod: Thanks for having me.
Peter McCormack: Safe journey home.
Ryan McLeod: Yeah, more adventures, yeah, and with this NAYGN thing, I'm going to be off to Japan in November to speak at an international nuclear conference, and then I was also accepted to do the same at the Adopting Bitcoin Conference in El Salvador a few weeks before that. So, yeah, I went from just a guy that just hung out in a lab listening to podcasts and now I'm jet-setting all around the world, evangelising about mining Bitcoin with nuclear power.
Peter McCormack: International nuclear playboy; I love that, man. You keep going, keep flying. You've got to get up to your age in countries, by the way; somebody told me that once. You should visit as many countries as your age because you're always going to new ones, and then you've got to stay ahead.
Ryan McLeod: Well, we'll see.
Peter McCormack: Well, keep travelling, buddy, and stay in touch and good luck with this.
Ryan McLeod: Thanks.
