Floating Nuke Power Plants Get Backing From Quant Investor

(Bloomberg) -- Gary Bergstrom is jumping from the world of data-based investing to the gritty problem of how best to supply relatively inexpensive energy to the developing world.

He’s backing a plan to mass-produce small nuclear reactors at a shipyard in South Korea that can be delivered by sea. A planned demonstration model may cost as little as $1 billion, substantially less than the $20 billion that big projects can cost, and the designs may eventually produce electricity for about 3 cents a kilowatt-hour.

In 1977, Bergstrom founded Acadian Asset Management LLC, a global quantitative investment firm with $95 billion in assets under management. He stepped down as chairman in 2011. Now he’s the lead investor in ThorCon International Pte, a Singapore-based company seeking funding to start building a test model within a year.

“Our major commercial focus is not on the U.S. or other developed economies,” Bergstrom said in an interview. “We’re focused on emerging markets where there are huge power needs.”

ThorCon’s goal is to raise $10 million to start construction within 12 months on a non-fission test system, according to Chief Executive Officer David Devanney. If it goes well, Devanney estimates the company could deliver a fully functional 500-megawatt demonstration plant in four years. He said he has a preliminary agreements to deliver it Indonesia.

Shipyard Assembly

ThorCon is in talks with South Korea’s Daewoo Shipbuilding & Marine Engineering Co. to build its plants. Manufacturing them on a shipyard assembly line is a key part of ThorCon’s strategy to keep costs down, Devanney said.

ThorCon isn’t the first company to pursue the idea. Russia’s Rosatom Corp. introduced a floating nuclear power plant last year. And the fossil fuel industry has floating facilities to liquefy natural gas, making it easier to store and transport.

While ThorCon’s idea has won some praise, Devanney said he’s facing a classic dilemma. As a new nuclear player with an unproven design, potential investors are wary. Some prospective users have said they’re more interested in being his second customer than his first.

“The technology is the easy part,” Devanney said Thursday. “The hardest challenge is funding.”

To contact the reporter on this story: Will Wade in New York at wwade4@bloomberg.net

To contact the editors responsible for this story: Lynn Doan at ldoan6@bloomberg.net, Joe Ryan

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