David Faherty

co-founder @elementlpower | building new nuclear
former submariner

opinions my own

[David Faherty @davidefaherty]

Nuclear is having a moment and we have a chance to rebuild the industry.

Policy, public opinion, capital markets and even hyperscalers are increasingly supportive.

People want new nuclear, but can we build it?

I've spent the last several years trying to understand what it's going to take. I'll share some of what we're learning along the way.

[David Faherty @davidefaherty]

Behind-the-meter / behind-the-fence nuclear for data centers sounds clean, but it usually isn’t the highest-value path.

1. Reliability: data centers need six nines. A handful of reactors on one site can’t match the redundancy the grid already provides.

2. System value: grid-connected plants deliver stability and extra capacity during transients. Behind-the-meter gives that up.

3. Economics: behind-the-meter microreactor fleets run into diseconomies of scale.

The better model is grid-attached new nuclear paired with data-center (and other large-load) development. It improves reliability for the customer, strengthens the grid, and creates real value for the surrounding communities. That’s the structure we’re building at @elementlpower.

[David Faherty @davidefaherty]

Thanks @gridmatters ! I had not come across the fault-current issue before.

For the layman: traditional generators (gas, coal, hydro, nuclear) can briefly push several times their normal current into a fault, which makes it easy for protection systems to detect the problem and trip the right breakers. Inverters generally cannot do that because their power electronics have much tighter current limits.

So even if grid-forming inverters can replicate a lot of the frequency and voltage-support functions of synchronous generation, fault detection and protection are still a separate engineering problem.

[David Faherty @davidefaherty]

Chapter 3: Then Demand Showed Up

When we first started thinking seriously about new nuclear, our demand thesis was mostly about replacement.

At the time, the U.S. nuclear fleet was roughly 95 GW and supplied about 20% of the country’s electricity, an enormous block of reliable, around-the-clock generation that had taken decades to build.

Meanwhile, from 2011 through 2020, roughly 95 GW of U.S. coal-fired capacity had already retired or switched fuels, with much more expected to follow.

The obvious question was: what replaces it?

[Madi Hilly @MadiHilly]

Successful mom & dad date day at the high-level nuclear waste facility 🧡

Thank you @COVRA_nv for the incredible hospitality!

More on this experience and one-of-a-kind place to come 🏵️

[David Faherty @davidefaherty]

@UnoMasReactor Great overview!

[Steffan Szumowski @UnoMasReactor]

https://t.co/o0y4kTbDFd

[David Faherty @davidefaherty]

The other major development was Chris Colbert joining Elementl.

We had been talking with Chris since 2022, while he was CFO of NuScale. He started advising us informally, then formally, and agreed to join when we closed the seed round.

Chris brought a background we badly needed.

He had developed gigawatts of fossil generation working with EPCs and developers. He had led nuclear development at UniStar, the EDF/Constellation joint venture formed during the first nuclear renaissance.

At NuScale, he helped grow the company from roughly 50 people to hundreds of employees and ultimately helped take it public.

He also knew the reactor technology landscape as well as almost anyone we had met.

We had the thesis.

Chris brought experience, relationships and judgment from actually developing large energy projects and building companies.

That was a major step in turning Elementl from an idea into a real platform.

End of Chapter 4.

[David Faherty @davidefaherty]

Chapter 4: Testing the Thesis

By this point, we had a thesis.

Nuclear needed a real development business model. Demand was growing. Reactor technology was advancing. Capital was interested.

But for the business model to work, we needed buy-in from a wide range of stakeholders.

Investors. Utilities. Reactor vendors. EPCs. Government. Regulators. Large power buyers. Industry veterans.

So we kept pressure-testing it.

The question was simple:

“Does this developer role actually solve a problem you have?”

[David Faherty @davidefaherty]

We entered formal discussions with EIP in 2023 and closed our seed round in Q4.

During diligence, we ended up on a call with roughly 40 of EIP’s utility and strategic LPs.

Two things became very clear.

First, the utilities increasingly believed they were going to need new nuclear.

Second, most had little desire to take the early-stage development risk themselves.

That was about as direct a validation of our thesis as we could have asked for.

Sam ultimately led EIP’s investment through Shayle Kann’s Frontier Fund. Both Sam and Shayle sit on our board today.

A serious energy investor with direct exposure to many of the utilities we hoped to serve was willing to put real capital behind the model.

[David Faherty @davidefaherty]

@charlesbonnerjr Thanks, Charles!

[David Faherty @davidefaherty]

Chapter 2: Then the Demand Shows up

https://t.co/ElTxQNcqtC

[David Faherty @davidefaherty]

Chapter 3: Then Demand Showed Up

When we first started thinking seriously about new nuclear, our demand thesis was mostly about replacement.

At the time, the U.S. nuclear fleet was roughly 95 GW and supplied about 20% of the country’s electricity, an enormous block of reliable, around-the-clock generation that had taken decades to build.

Meanwhile, from 2011 through 2020, roughly 95 GW of U.S. coal-fired capacity had already retired or switched fuels, with much more expected to follow.

The obvious question was: what replaces it?

[David Faherty @davidefaherty]

Nuclear is having a moment and we have a chance to rebuild the industry.

Policy, public opinion, capital markets and even hyperscalers are increasingly supportive.

People want new nuclear, but can we build it?

I've spent the last several years trying to understand what it's going to take. I'll share some of what we're learning along the way.

[David Faherty @davidefaherty]

Chapter 2: Nuclear’s Missing Business Model

How hundreds of conversations with investors and industry participants helped us figure out what a nuclear developer actually needed to do.

[David Faherty @davidefaherty]

Chapter 2: Nuclear’s Missing Business Model

2022, we had enough conviction to start building Elementl.

We thought we had identified the problem: the industry needed real projects, not simply more reactor designs.

What we didn’t yet know was exactly what kind of company needed to exist to solve it.

[David Faherty @davidefaherty]

AI, hyperscalers, electrification and reshoring were all pointing in the same direction: America was going to need a lot more electricity.

The opportunity was no longer simply to replace what the grid was losing. It was to help build what came next.

End of Chapter 3.

[David Faherty @davidefaherty]

That fit almost perfectly with the gap we thought we had identified. The reactor vendors had technology.
The hyperscalers had demand. Someone had to turn one into the other.

By then, our demand thesis had changed materially.
We started with a replacement problem: coal was retiring, the grid still needed firm power, and nuclear looked like part of the answer.

Then load growth showed up.