Investing: The only SMR play
Рет қаралды 3,150
Жыл бұрынRecording date: 11th April 2022
I've often ranted that if I were "global dictator", I would cancel all wind and solar and pour resources into small modular reactors. They could provide; dense, safe and clean baseload electricity. They could also be a means to provide economic hydrogen, which is a legitimate way to wean ourselves off fossil fuels in the long run.
While I hoped this could one day eventuate, there was no public way to play the trend until very recently. One only has to have a quick review of companies developing SMRs to conclude they are mainly state-owned or private companies. For the few that are investable, the SMR business line is a rounding error for the company.
That is about to change with Nuscale, founded based on DOE funding before being taken private in 2007 and battling along as a private company with over $1.3B invested in bringing commercial SMRs to the world. It stands out from its competitors in that it is the only SMR company to receive NRC (Nuclear Regulation Commission) standard design approval.
What has recently changed (hat tip to Nick Jones for bringing this to my attention) in a SPAC (special purpose acquisition company) is in the process of merging with Nuscale to bring the company public. SPACs are just a pile of funds sitting in trust waiting for a merger or acquisition and help fast track the IPO process.
This SPAC is called Spring Valley Acquisition Corp (Ticker: SV on NASDAQ) and is adding $232m of equity, $181m is being added via a PIPE (private investment in public equity) which includes Segra Capital Management, and $1875 of Nuscales equity is being rolled into the deal. This ultimately will give Nuscale $462m to accelerate the commercialisation of its SMRs.
The SEC has given this the go-ahead, and it just needs the SV stockholders to vote in favour on the 27th of April 2022 for the deal to go ahead.
You can read further details here and see Nuscales investor presentation here.
I wouldn't put too much trust in the revenue projections as they are all just guessing at this stage. I know that wind and solar are deeply flawed and will never achieve 100% of the electricity grid as the IEA is forecasting. However, logic will eventually prevail as wind and solar continue to miss their targets, and SMRs stand to be a huge beneficiary.
I've started to build a position in SV targeting 2% equity (price currently $10.73) and 0.5% warrants (even though the warrants are pricey at $2.70, I want the attentional leverage).
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@lancobear3544 8 ай бұрын
Hey Ferg, curious of your thoughts on Nuscale as of late. Share price has taken a nosedive to $3.50. Are you looking to add, sell, or hold. I personally added to the position today @ $3.50 it just looks too oversold and too cheap not to pick up some shares. Thanks Ferg, always appreciate your insights
@clarkkent9080 7 ай бұрын
The NuScale SMR project (the ONLY SMR project in the U.S.) was to come online starting in 2029 and was supposed to replace electricity from coal plants that are closing. They were give n $2 billion in taxpayer money, free government land on which to build, and NRC fully approved their project. Instead, NuScale and the Utah utilities announced Wednesday (11/ 8/23) they're terminating the project after a decade of working on it. The cancellation comes amid supply chain problems, high interest rates and a failure to obtain the desired tax credits. “The termination of NuScale's contract signals the broader challenges of developing nuclear energy in the United States. Placing excessive reliance on untested technologies without adequate consideration of economic viability, practicality, and safety concerns is irresponsible and clearly won’t work. The failure of this project underscores the need for decision makers to work diligently to ensure that the pursuit of nuclear energy aligns with the imperatives of public safety and financial feasibility. “For all its problems, NuScale is one of the designs with the best prospects for commercialization because of its similarity to conventional light-water reactors, which allowed the company to learn from extensive operating experience and to leverage much of the existing nuclear power supply chain. Thus, the failure of the NuScale project with UAMPS does not bode well for the dozens of other, more exotic reactor types in various stages of development that are being touted as the next best thing in nuclear power, such as sodium-cooled fast reactors, gas-cooled reactors and molten-salt reactors. These reactors, which are based on much less mature designs and generally require fuels and materials that are not readily available, will be even riskier bets than NuScale for the foreseeable future. There are currently no other new nuclear power reactor designs under NRC licensing review. “As private interests continue to turn their attention to emerging nuclear energy technology, lessons from this project should be held top of mind.”
@Phaedrus5015 Жыл бұрын
Hi Fergus--Any change to your Nuscale thesis or outlook? After an initial runup, Nuscale lost all of that pump and really hasn't done much over the past several months. Disappointing, but I realize it is a very long play. Thanks!
@clarkkent9080 7 ай бұрын
The NuScale SMR project (the ONLY SMR project in the U.S.) was to come online starting in 2029 and was supposed to replace electricity from coal plants that are closing. They were give n $2 billion in taxpayer money, free government land on which to build, and NRC fully approved their project. Instead, NuScale and the Utah utilities announced Wednesday (11/ 8/23) they're terminating the project after a decade of working on it. The cancellation comes amid supply chain problems, high interest rates and a failure to obtain the desired tax credits. “The termination of NuScale's contract signals the broader challenges of developing nuclear energy in the United States. Placing excessive reliance on untested technologies without adequate consideration of economic viability, practicality, and safety concerns is irresponsible and clearly won’t work. The failure of this project underscores the need for decision makers to work diligently to ensure that the pursuit of nuclear energy aligns with the imperatives of public safety and financial feasibility. “For all its problems, NuScale is one of the designs with the best prospects for commercialization because of its similarity to conventional light-water reactors, which allowed the company to learn from extensive operating experience and to leverage much of the existing nuclear power supply chain. Thus, the failure of the NuScale project with UAMPS does not bode well for the dozens of other, more exotic reactor types in various stages of development that are being touted as the next best thing in nuclear power, such as sodium-cooled fast reactors, gas-cooled reactors and molten-salt reactors. These reactors, which are based on much less mature designs and generally require fuels and materials that are not readily available, will be even riskier bets than NuScale for the foreseeable future. There are currently no other new nuclear power reactor designs under NRC licensing review. “As private interests continue to turn their attention to emerging nuclear energy technology, lessons from this project should be held top of mind.”
@imrepetrohai Жыл бұрын
the CFO just dumped a ton of his stocks, any idea why? SMR price got beaten down badly
@CRUXInvestor Жыл бұрын
Small Modular Reactors (SMR)
@nofloco3175 Жыл бұрын
@@CRUXInvestor SMR is the stock ticker of nuscale power
@clarkkent9080 7 ай бұрын
The NuScale SMR project (the ONLY SMR project in the U.S.) was to come online starting in 2029 and was supposed to replace electricity from coal plants that are closing. They were give n $2 billion in taxpayer money, free government land on which to build, and NRC fully approved their project. Instead, NuScale and the Utah utilities announced Wednesday (11/ 8/23) they're terminating the project after a decade of working on it. The cancellation comes amid supply chain problems, high interest rates and a failure to obtain the desired tax credits. “The termination of NuScale's contract signals the broader challenges of developing nuclear energy in the United States. Placing excessive reliance on untested technologies without adequate consideration of economic viability, practicality, and safety concerns is irresponsible and clearly won’t work. The failure of this project underscores the need for decision makers to work diligently to ensure that the pursuit of nuclear energy aligns with the imperatives of public safety and financial feasibility. “For all its problems, NuScale is one of the designs with the best prospects for commercialization because of its similarity to conventional light-water reactors, which allowed the company to learn from extensive operating experience and to leverage much of the existing nuclear power supply chain. Thus, the failure of the NuScale project with UAMPS does not bode well for the dozens of other, more exotic reactor types in various stages of development that are being touted as the next best thing in nuclear power, such as sodium-cooled fast reactors, gas-cooled reactors and molten-salt reactors. These reactors, which are based on much less mature designs and generally require fuels and materials that are not readily available, will be even riskier bets than NuScale for the foreseeable future. There are currently no other new nuclear power reactor designs under NRC licensing review. “As private interests continue to turn their attention to emerging nuclear energy technology, lessons from this project should be held top of mind.”
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