That focus crowded out most discussion about two major campaign issues that both have a huge impact on foreign policy - energy and the environment. Whenever the candidates tried to talk about energy policies, the moderator immediately tried to change the subject.

I am not a single issue voter, but I really want to understand the nuances of the energy policy positions for the two candidates in this particular election. The last time energy policy was such a major part of the campaign was in 1976; the result of that election made a huge difference in our current energy source mix.

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Several weeks ago, I had the opportunity to talk with John (Grizz) Deal for The Atomic Show Podcast. We had a very interesting chat, but I did not get into the business aspects of the development as much as a more recent interview conducted by Techrockies after watching a Hyperion presentation at the Venture Capital in the Rockies Fall Conference.

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Last week, during a tumultuous week on Wall Street, Warren Buffett’s MidAmerica Energy Holdings decided to take advantage of an enormous market opportunity and agreed to pay $4.7 billion dollars for Constellation Energy Group, valuing the company at $26.50 per share. As recently as mid summer 2008, Constellation stock was trading for more than $80 per share. Buffett is famous for spending his days reading annual reports and learning about companies; he is also famous for buying companies he likes “on sale”.

MidAmerican was able to make its bid after just 48 hours of review because the company was already familiar with Constellation’s assets and plans. Part of that familiarity came as a result of the $13 million investment in the project research in Idaho - MidAmerican had planned to partner with Unistar Nuclear to build and operate the plant.

Unistar Nuclear, a joint venture with EDF (Electricite de France, mainly owned by the French government), is a major part of Constellation Energy’s strategy for future growth. Unistar has partnered with some of the premier suppliers in the energy business including Areva, Bechtel, Alstom, and Accenture, to put together a formidable team that is dedicated to the following mission:

UniStar Nuclear Energy, LLC, a Constellation Energy and EDF company, is working to enhance U.S. energy security through the expansion of clean, safe and sustainable nuclear energy. We ensure the highest level of reactor safety, security, and reliability. Through licensing, constructing and operating the most efficient fleet of advanced nuclear power plants in North America, we are working to help slow, stop and reverse the impacts of global climate change.

A number of blogs, including Most Popular in USA and the Wall Street Journal’s Environmental Capital, have pointed out that MidAmerican’s investment in Constellation sends a different signal about Buffett’s comfort level with nuclear power than its previous decision in Idaho. Some dissenters on those blogs have attempted to marginalize the importance of that signal by pointing out that Constellation’s current assets of 8700 MW of generating capacity - with more than 60% in already operating nuclear plants - means that the $4.7 billion investment can be justified without any future growth.

The fact that Constellation’s current asset base makes the purchase a good buy on its own without growth is a reasonable first order interpretation. That is not the Buffett way of investing, however. He is famously known as someone who does not overpay for anything - which might explain the decision to wait on the Idaho investment at a time when the price of everything associated with building a new power plant seemed to be headed into the stratosphere.

However, Warren Buffett is also famously known for buying companies with good management, excellent growth prospects, dominant market position and understandable product lines that would benefit greatly by having a patient financial partner who can support their growth plans. There are few products in the world more basic and understandable than electricity and few other industries where the normal practice is to allow a single supplier to dominate regional markets.

Here is what his point man on the Constellation purchase said about the future:

Gregory Abel, chief executive of MidAmerican, said Berkshire is “very comfortable with and committed to Constellation’s current strategic plan” and intends “to allow Constellation Energy to operate autonomously” as it pursues its goals, including development of nuclear plants. Constellation’s current management is expected to remain.

This purchase is getting good support in the press in Constellation’s home town of Baltimore, Maryland and should be interpreted as far more than a demonstration of support for the future prospects of nuclear power by one of the world’s most far sighted investors. One of the biggest legitimate questions about the nuclear renaissance has been related to obtaining the necessary capital to build the plants.

For one company, at least, that question has been answered in a very direct manner; few would disagree that Unistar Nuclear, which is now backed by both the French government and Warren Buffett’s Berkshire Hathaway, has the corporate resources to finance several new plants without any additional support from external partners.

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Specifically, that paper stated:

“This white paper does not contain specific proposals for building new nuclear power stations. However we do not rule out the possibility that at some point in the future new nuclear build might be necessary if we are to meet our carbon targets.”

The report authors probably did not expect that “point in the future” to arrive quite as quickly as it has. After much public consultation, a new white paper was issued in January 2008 that determined that new nuclear plant construction had to begin - quickly.

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Gordon:

One thing you apparently do not understand about nuclear fission is that it can come in a variety of sizes. Not all plants are the extra large central station power plants that you are discussing.

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Exelon has chosen the Economic Simplified Boiling Water Reactor (ESBWR) marketed by GE-Hitachi Nuclear Energy. Each of the reactors will produce approximately 1,500 MW of electric power.

One of the key design features of the ESBWR is a large degree of passive safety provided by large water reservoirs, natural coolant circulation and safety systems that operate without any electrical power. (Link to animation of ESBWR safety system operation)

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My wait is now closer to ending. On August 21, the US Food and Drug Administration approved the use of ionizing radiation at doses that will drastically reduce the population of the target bacteria on spinach and iceberg lettuce without harming the food.

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On August 22, 2008, the company announced that it had signed a contract for engineering, procurement, project and construction management (EPCM) services to build a 165 MWe commercial scale, emission free, demonstration plant near Cape Town, South Africa. The approximate value of the contract is a quarter of a billion US dollars.

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If you take a look at a map of the pipeline, you will begin to understand the geopolitical importance of the effort to provide a path out of the Caspian Sea region - home to a large oil and gas reservoir - that does not pass through Iran or Russia. Until the BTC was completed, there was no way to move Azeri oil out to the rest of the market without going through Russia.

(Aside: The map indicates that a path through Armenia could have been chosen instead of through Georgia, but apparently Armenia and Azerbaijan have a long-standing conflict over a region known as Mountainous Kharabakh.)

Unfortunately, western leaders underestimated the strength of Russia’s objection to losing control over Azerbaijan’s oil and gas resources. They also underestimated Russia’s ability to do something about its desire to reassert control. By biding its time and working in the way of the excellent chess players that they are, Russia has put itself in a position to control (stop?) the flow and there are few acceptable actions that can be taken to change the situation.

One of the few things that has a long term chance of success is a focused program of reducing the importance of oil and gas in the world economy.

My input on that front is to steadily increase the use of uranium and thorium fuels whose supply cannot be severed by an aggressor sitting astride a key delivery path. When electricity and ship propulsion is powered by heavy metal fission instead of natural gas or oil, the importance of owning the valves that supply heat and power gradually dims to insignificance.

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Each HPM will be priced at approximately $25 million. The company did not disclose an expected shipping date for the first HPM, but the US Nuclear Regulatory Commission currently lists their scheduled manufacturing license review as starting in 2012 with an projected completion sometime in 2015. (Ref - Periodic Briefing on New Reactor Issues dated February 20, 2008 - PDF.)

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I used quotes and capital letters to emphasize a point - I recognize that there are individual people concerned about the environment who have a more open mind and are willing to accept the notion that nuclear power has a place at the table in any discussion about our reduced carbon energy future. The officially recognized groups and spokesmen for The Movement seem unimpressed and continue to firmly oppose nuclear development. The remaining arguments end up being cost, waste and nuclear weapons.

Cost is an issue for another day, but the arguments against nuclear power on the matter of waste and relationship to nuclear weapons rest on shaky ground that is beginning to give way. More and more people, including some in responsible leadership positions, are beginning to realize that the tired arguments originated in the 1970s no longer apply. They actually never did.

There are about 55,000 tons of used nuclear fuel resting quietly in cooling pools and dry storage containers on the sites where the fuel was initially used. That may sound like a large amount, but compared to the fact that a single 1000 MWe coal fired power plant can release 45,000 tons of waste to the atmosphere every single day, 55,000 tons of used material after 50 years of nuclear plant operation seems vanishingly small.

You may have noticed that I have carefully avoided calling that slightly used material “waste”. Unlike the gases, ash and soot released to our common atmosphere from coal, oil, gas and biomass fired power plants, the materials left over from nuclear fission reactors are sealed in corrosion resistant cladding and look a lot like they did when they first entered the reactor. Inside those tubes, the material is still mostly solid uranium dioxide - only about 4-5% of the initial material has been converted into other elements.

Essentially all of the remainders from nuclear plant operation could be recovered and reused; some of it would best be used as feedstock for future reactors, other parts should be segregated and used in other material applications for long life batteries, catalysts, and irradiation source materials.

Both of the remaining US presidential candidates seem to be open to the idea that used fuel should be recycled and reused. That is a welcome position since it looks like there will be a number of new reactors under construction soon and they will provide a ready market for the recycled fuel. There will need to be a bipartisan effort to establish rules that do not change with political winds, however, before private industry will invest in the system.

ALL of the used fuel has been carefully stored away in a form that is easy to control and easy to keep segregated. It does not take up much space, does not cost much to watch (compared to the heat value that it provided), and it has never hurt anyone because the people that watch it understand the simple concepts of time, distance and shielding.

As a life time procrastinator, I am actually encouraged by the fact that while we continue to debate and pontificate about the pros and cons of long term disposal, the natural process of radioactive decay continues to make the fuel easier and easier to handle. That process can reduce the cost of recycling, when we finally get around to it.

Perhaps those of us who are advocates of the increased use of nuclear energy as a clean, emissions free source of reliable, low cost power should thank the people who have prevented the used fuel from being too hastily moved or recycled.

Not only do we have a growing volume of seasoned raw materials, but when we finally do get around to building facilities, we can do so using up to date methods and the lessons learned from the first generation facilities in other countries. The democratic process really does favor the patient.

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What Do You Do About the Waste? Recycle and Reuse.

Web denizens, Navy submariners, former Army Nukes, and others have always recognized that the former Vice President’s comment does not provide a full picture of the possibilities. While it is certainly true that vendors like GE, Areva, Rosatom, Siemens, and Mitsubishi have chosen to limit their model line-up to the very largest plants, the technical fact is that nuclear reactors have always been available in multiple sizes ranging from petite to XXL.

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Corn ethanol is also causing some very interesting political discussions that result in strange bedfellow alliances on all sides of the argument. Conservative and liberal labels have no real meaning in this discussion; even regional boundaries are being made fuzzy by the varying impacts of the market changes.

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I thought it might be worth taking a few minutes to remember that people who developed internal combustion engines were not people focused on selling fossil fuels, they were people interested in solving a very real challenge - energy storage and delivery on a moving vehicle. When all factors are taken into account, fossil fuels provide a compact, lightweight form of energy that can be readily converted to power in device that is moving - sometimes very rapidly and without any connection to the earth.

There are certainly times in all of our lives when we feel like the big oil companies have us over a barrel, but their dominance came as a result of the high performance that their product gave to automobiles, trains, trucks, ships and aircraft. By many measures, their product remains the best technical choice available.

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I am not rich, not powerful and not a public figure. I have not spent my career drilling oil and gas wells, raiding companies, running for office, or building an industry dominating chip supplier. Instead, I have been struggling for more than 15 years to try to share a vision for a cleaner, safer, more prosperous world made possible by moving away from carbon based fuels that put most of us into dependence on people that simply do not like or respect us.

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As a former submarine engineer, I never fail to marvel at the fact that a volume of fuel small enough to fit under my office desk could power a ship for 15-30 years without even taking a breath. Trying to compare nuclear capabilities with wind or solar power is like trying to compare Michael Jordan in his prime to a bench warmer on an elementary school basketball team.

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The US Energy Information Agency does a fine job of keeping statistical records of energy sources - though its predictive arm has had some real miscues over the years. The graph associated with this article provides a picture illustrates that the use of oil for electricity in the US may be small now, but that is because it was replaced by nuclear fission during the growth years in the 1970s and 1980s.

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He has been running advertisements on major media outlets describing a clear challenge - America now sends $700 Billion across its borders every year to purchase oil.

Pickens has a plan to reduce that number and he intends to share the details of the plan during the coming weeks. He has been an oilman all his life; that has made him a strong believer in Peak Oil.

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As successful as Manhattan and Apollo were at achieving their stated goals, both share a common flaw as a model for attacking our energy supply challenges - they were sprints that left their respective teams panting and wiped out when the initial goal was achieved. In contrast, the Interstate Highway system was a more distributed, long-term effort whose accomplishment required a sustained, methodical approach lasting more than 50 years (so far). It was more of an endurance relay event than a sprint.

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