Adam Smith [00:00:58] I am Adam Smith and you're listening to the Titans of Nuclear Podcast. Today, you'll be hearing from Boris Schucht, the CEO of Urenco Global. Boris, welcome to the show, and we're glad to have you here.

Boris Schucht [00:01:11] Welcome, Adam. Nice to hear you.

Adam Smith [00:01:15] So, I guess to start this off, let's hear more about your background and just give the listeners a view of how you got started in the industry as well.

Boris Schucht [00:01:27] It's interesting. Not a lot of people know that actually I'm a nuclear engineer, most likely one of the last ones in Germany. But I never worked before, I don't rank within the nuclear industry. So really, I have grown up in the energy business, working for utilities for a long time in integrated utilities. And then the last 10 years, I was responsible, before I joined Urenco four years ago, for one of the four German transmission system operators. And so when I would describe my whole life, my whole business life, what what drove me is very simple. I have so far dedicated most of my business life for organizing the energy transition. And I'm very much convinced of that. My former role was about integrating as many renewables as possible into an electrical system, into a system that was world class there. And now once again, a very important company, Urenco, in the nuclear fuel cycle. And without nuclear, achieving net zero is in my view absolutely impossible. Therefore, this is such an exciting role, and once again one step in my personal life in delivering my work for the energy transition.

Adam Smith [00:03:02] Yeah. We also agree that nuclear is one of the key pillars of the energy transition. So I guess going back to your background then, what from your childhood led you to be interested in the energy transition? Or was that something that happened more in your later years as an adult?

Boris Schucht [00:03:24] I think when I was 16 or 15. So really, still before university or the end of school. There were always newspapers and weekly papers about exciting technological development. And one of the things at that time was the first big one megawatt windmill that was called Govian somewhere on the North Coast. I was very excited; I said, "That makes a lot of sense." And when I started then 10 years later in my business life I created the first windmill. They then slowly became reality. And it was interesting. I came into an organization which was running lignite coal plants on a big, huge grid. Wind farms were seen as a threat and not as an opportunity. And I never understood it. For me, it was always an opportunity. So what I learned in all of the different, all of my different phases of my career, the energy transition is a huge opportunity. It's of course, a challenge, but it's also a huge opportunity for companies but also for individuals. And I'm a good example as a person. As a person, I have always looked at the opportunities around the energy transition and by that, I made my career.

Adam Smith [00:04:51] Yeah, that's amazing. So, you've always been looking for the opportunities. How did you come to the conclusion then that nuclear was the opportunity? Because I'd imagine at the time, or for the time period that you would have been growing up, nuclear might not have been as favorably viewed as some of the other alternative energy sources.

Boris Schucht [00:05:15] Absolutely Adam, and especially in Germany, as you can imagine.

Adam Smith [00:05:19] You're a dying breed. A nuclear engineer from Germany?

Boris Schucht [00:05:23] Absolutely. But I can tell you, when you look... And that's a very simple story. And I understood that 10 years ago. When we talk about the energy transition, we often only think about the electricity consumption. We only look at the electricity consumption. And most countries have nowadays a share, at least of the industrial countries, of 15% or 16% of the electricity consumption that is already decarbonized, which is, I would say, after 30 years of energy transition, a huge success. And based on hydro power that was first, then renewables and also nuclear power. So, very different sources. And and I think it's not unrealistic... It will be challenging, but it's not unrealistic that we will decarbonize the other half or 40% of the electricity consumption.

Boris Schucht [00:06:21] But the electricity consumption is only one-fifth or one-seventh of the total energy consumption of a country. And that describes pretty well, when you mentioned that describes the rest as only fossil fuels. So it's about oil, gas consumption, coal consumption for all the industry processes, for all transportation, whether it's private or heavy duty transportation or airplanes or ships or whatever it is. So there's a huge amount of energy consumption which still has to be decarbonize in other sectors, not directly in the electricity sector as we know it today.

Boris Schucht [00:07:04] And when you look at that, then you're saying, "Okay, this is such a huge challenge. That is such a huge challenge. It will be extremely difficult for the world to achieve these targets." And then excluding a CO2 free technology, how should that work? We will need all of them. And whether we like nuclear because of the... Also the deficits of nuclear, we all know them whether we like it or not. But at the end, we have to make a judgment and I think it's the only solution to achieve net zero or to come close to net zero when we also include as much as possible nuclear as part of the solution to decarbonize the world. And that's where I'm coming from.

Boris Schucht [00:07:50] So, when I arrived here at the company, we were not yet there. It slowly took countries to understand and societies to understand that Germany has not arrived yet. So, that's another story. But I'm highly convinced of that. And therefore, I believe it's a very interesting industry and it's a very challenging industry which gives a lot of opportunities, businesswise, but also for young people, for the new generation, for career opportunities, because it will be needed.

Adam Smith [00:08:29] Yep. Nuclear is going to be absolutely critical, so we completely agree with you on that one. To further that point, to exclude baseload electric generation is just crazy because some of these offtakers that you mentioned in the industrial and commercial spaces, they need that 24/7 uptime and that's just challenging to get in the current electric generation environment. Maybe one day with storage, but for right now we have the perfect technology in our hands and it's been operating for 60, 70 years, very reliably. What got you particularly interested? You're a nuclear engineer by background, but what particularly interested you in the fuel cycle side of this, the enrichment and the whole cycle of those fuel products?

Boris Schucht [00:09:26] I must say, when you look now specifically at Urenco, that was a very special company. The fuel cycle is also special industry, but the company is really unique. And I personally like to work on the interface between political environment and industrial and commercial environment. And Urenco is once again exactly in this space. Two governments as shareholders with the whole company based on a treaty. It's on three treaties nowadays, but it's very different from a normal commercial company. It's something which I personally like. So it's bringing industrial needs and commercial needs with political needs and societies together. And I think we have a role to play as Urenco to serve, somehow, societies. And I think we are doing that pretty well already for quite a long time. That company is already 50 years old, more than 50 years old, and is doing that, I think, extremely, extremely well.

Boris Schucht [00:10:44] The second point, I must say, a more technical point. The enrichment plants that we operate and the centrifuges we operate are at the edge of what you can engineer, of what you can build. It's amazing. It's really fast spinning things that you switch them on and they operate without any maintenance for decades. And that is really amazing. So this technology is a very efficient technology for producing the fuel. And that is exciting from a technological point of view. So, I like that.

Boris Schucht [00:11:32] A little bit of the drivers, there are of course always some more. This company is a very international one, more global than any other company in the nuclear sector and in the energy sector. And I must say, that was for me also one personal one. And I have taken the decision a few years ago that was one of the personal things that I really was seeking, to work in a very international, global environment. And I must say, I like that very much.

Adam Smith [00:12:10] Yep. For the listeners... And correct me if I'm wrong here, but Urenco is a consortium of British, Dutch and German entities, correct?

Boris Schucht [00:12:20] Yeah. We have four shareholders. The U.K. government, the Dutch government and two German utilities. So that is our shareholder structure. But we have plants in four countries. So that is in the U.K. and the Netherlands and Germany and the U.S. And we have more than 50 customers all over the world in 20 countries, all over the world. And in a lot of countries, we have a very important role to play. In the U.S., we are the only enrichment plant, locally. And so we have a very important role to play for the fuel supply of the U.S. nuclear power plants. So the company is extremely important, and has in this special niche, a very, very high visibility.

Adam Smith [00:13:27] You mentioned that you have four facilities and one of those is in the U.S. Is that the Los Alamos plant?

Boris Schucht [00:13:33] No, it's in Eunice at the border between New Mexico and Texas. So in the middle of the desert, there in the oil area. A very special area and a very special plant that was newly built. It is now roughly 10 years in operation and is our newest plant and a fantastic plant, very efficient and very well managed, I must say. And it's fantastic that we have this opportunity there.

Adam Smith [00:14:10] Yeah. It sounds like you guys have really perfected the centrifuge technology. I was reading a report from Urenco from like the early '90s, I think. You guys were experimenting with not just making centrifuge technology more efficient, but you're also looking at other technologies and their benefits, like molecular laser isotope separation and the atomic vapor separation. And what it really seemed like was there was so much room for improvement on the centrifuge technology. Just to become more efficient, you make the centrifuges longer and you spin them faster, and then all of a sudden you can produce just multiples of what you could previously in terms of enrichment capacity. Do you foresee that continuing? Are you kind of at the limits of the engineering threshold on how fast you can spin these vessels or how, I guess, tall you can make them?

Boris Schucht [00:15:07] It moves a little bit into a different direction. When I was arriving here four years ago, I was surprised that we are doing something outside of the nuclear fuel cycle, which is what was our technology, which not a lot of people know, it's not very visible, but which is extremely important because we are producing stable and by then medical isotopes. And what are rare, rare isotopes for diagnostics or cancer treatment. And with our isotopes, I think more than 2 million patients are each year are treated worldwide. And we have only a small market share in this market, so that is quickly growing and we are heavily investing in that. But that is a very interesting area where our technology is used outside of our normal core application, and as I would say, providing a lot of added value to societies because this is an area where a lot of things are in the moment happening. Cancer treatment by radioisotopes is one of the hot topics in the moment. And I think it's a very nice additional activity that we have there. It's not only saving the climate, but also saving lives of people by something which is otherwise not possible.

Adam Smith [00:16:44] Well, you're saving lives from both ends. It's clean energy saves lives through avoided air pollution, and then you also end up with the medical isotopes for cancer research. And yeah, it's just all around useful, helpful technology to everyone on the planet. So we definitely support your efforts there. And you mentioned that's becoming one of your larger segments. Is that within your current, I guess, enrichment markets or are you doing that globally around the world?

Boris Schucht [00:17:13] That is globally around the world. But we are currently doing, technically doing that in one of our sites in the Netherlands and we are enriching stable isotopes and we are building one cascade after another. I think one of those years ago we took the so-called Leonardo da Vinci cascade into operation where each cascade is then designed a little bit for different isotopes. Some are more flexible. Then we are also doing a lot of research.

Adam Smith [00:18:57] So, you mentioned that you've moved into the medical isotope industry, and that will be a huge growth area for you. Are you also looking at how Urenco's role might play into the development of the new nuclear space within these different fuels or different SMR designs? All of the above, really.

Boris Schucht [00:19:21] You're touching a very important topic. I strongly, personally believe that the next generation of nuclear power plants will be needed pretty soon. It's now the right momentum at the right time for these power plants to come up. At least some strong nations like the U.S. and the U.K., my understanding is they have a similar understanding on that. The support that we see, for example, the Inflation Reduction Act in the U.S., but also the additional discussions which are ongoing in the U.S. will give to this market exactly what is needed.

Boris Schucht [00:20:14] Why do I believe in that? I think the existing nuclear power plants, when you build more of them, you will be also more efficient. But they are, at the end, extreme large constructions. And the lead time to construct them, to plan them, is extremely long and they are extremely big and complex projects. To reduce the complexity of these projects makes a lot of sense. And by the way, we are still using a little bit of the concept that had been developed 30 or 40 years ago. And we all know that you can build today safer and less complex nuclear power plants. And that's why I think that the development into new designs and into new SMRs and RMRs is so extremely important. And I'm pretty sure they will come. And there's a second driver we can touch on maybe later on in hydrogen, that is hydrogen related, but that is an additional driver.

Boris Schucht [00:21:18] And a lot of these concepts, new design concepts, they need also slightly different fuel. And we are strongly committed to deliver this fuel. In the first instance, we have a name for it, advanced fuel, we call it. And the first product in there we call LEU+. It is LEU enriched up to 10%. And we see now the first customers knocking on the door and negotiating contracts with us. So that is close to realization. In the next two years we will be able to deliver on that.

Boris Schucht [00:21:57] And then there is the area that a lot of SMRs will need. That is a fuel between 10% and 20% enriched, 19.75% or whatever it is at the end of the day. And there we need to invest in new assets. That's a chicken and egg problem. I strongly believe it will come, but there is no market yet. And it's a huge investment for us, so we are in discussions with the U.S. government, with the U.K. government, to find solutions and how to actually get the kind of regulation around it that allows us to take such an investment decision and offers this fuel as soon as possible to the industry.

Boris Schucht [00:22:48] My impression is that the support, that first of all, governments have understood this, that there is a need to bring the things together. The SMR/RMR industry is also articulating their needs very clearly and we are ready to go. So that is really the next step. And when these things are in place, I'm pretty sure that we will see the next generation of nuclear power plants then coming. But we should not forget, until this is really deploying in the market, until then, we will see a lot of other projects still designed that we are currently building worldwide in the nuclear sector. And we will see quite a lot of them still also with some learning curves and some really hopefully positive messages around them.

Adam Smith [00:23:48] Yeah, that sounds amazing. You guys seem like you're positioned really well to take full advantage of what I would call, not to beat a dead horse, but the nuclear renaissance. The actual nuclear renaissance this time around where we have all these new reactor designs, new fuels, just generally more demand coming from an enrichment side of things. Given that we have all of this oncoming demand and we also currently have some geopolitically induced supply constraints on SWU, have you as Urenco's CEO started looking at potentials to expand Urenco's current production capacity, or is that more of a short-term view on the geopolitical side of things where the SMR design might be more of a longer-term view, and you'll build out that capacity as the demand comes online?

Boris Schucht [00:24:52] The SMRs and RMRs, I think that will be an additional demand more on long-term. So that will come slowly into the market and will be visible before it starts, years before. What happened this year, the geopolitical changes, they are dramatic. However, we have been in the luxury of situation that due to Fukushima we had some overcapacities which we could use now to actually make sure that the dependency of our customers and the flexibility of our customers on the fuel side is as high as possible. So, we don't see currently that we can't deliver or fulfill requests of any of our customers. So, there is sufficient capacity available. However, of course we have planned in mid and long-term with a completely different scenario, and that's why we have heavily invested into capacity in the coming years in refurbishment campaigns to keep capacity alive, but also into capacity expansion to be able to fulfill all the requests of our customers also in the coming years. But the good thing is, even with this geopolitical disruption that we have seen last year, we are able to actually cover the demand without too many problems.

Adam Smith [00:26:42] Yeah, it sounds like you guys are all around well-positioned in the market then. You mentioned earlier, we were talking about SMRs. Do you have any particular technologies that you are interested in or find particularly beneficial to solving some of the issues in the nuclear space?

Boris Schucht [00:27:03] There is one that comes from the demand side. So for what do you need the heat or the electricities that a nuclear power plant produces? And we already mentioned the electricity sector is not the one which creates the biggest headaches for us. I think all the other sectors are more complex. And what more and more countries also understand, you can't decarbonize these other sectors without a hydrogen industry. You will need hydrogen to replace, for example, coal in steel production. You will need hydrogen for synthetic fuel for airplanes or wherever it goes. So, a lot of processes where you have to replace fossil fuels by hydrogen or hydrogen-based synthetic fuels.

Boris Schucht [00:28:01] Then the question is, where does hydrogen come from? And we did two years ago, a very interesting study based on the situation in the U.K. The first study was done in one industry to see how high will the hydrogen demand of the U.K. be in a fully decarbonized world. And then the second study, which we asked Aurora to do for us as an independent study was where should this hydrogen come from and what is the cheapest way to produce this hydrogen? And there, actually it became very clear when you combine high temperature reactors with hydrogen production then you have the advantage of a baseload energy source combined with a pretty expensive hydrogen production. So with this essence, you can avoid going via electricity. When you go via electricity, you lose a lot of efficiency.

Boris Schucht [00:29:08] Now, first from heat to electricity and then back from electricity to hydrogen, the efficiency is below 30% or below 20%. And when you go directly from heat to hydrogen, then the electricity demand is much, much lower, and this process becomes extremely efficient. And the cost advantage that you have by going this path is tremendous. And that's why I personally believe the combination of high-temperature reactors with hydrogen production, that is one element that we will see in the future. But once again, the energy mix is always a very wide, wide mix. So I think that will not be the only solution, but I think that will be an interesting additional technological element in the energy mix where new technology will come up.

Adam Smith [00:30:07] Yeah. It definitely seems like hydrogen is going to be critical to nuclear's growth, just because we are one of the few sources of energy that can actually be used to produce truly clean hydrogen on a continual basis. So as hydrogen becomes more and more adopted, nuclear is going to be more and more widely accepted or at least needed. So, yep, we are tied together with the hydrogen industry.

Adam Smith [00:30:40] Now pivoting a little bit, in 2020 Urenco celebrated its 50th anniversary of its founding treaty. What are some of the milestones Urenco has experienced since then and what can listeners look forward to seeing next year out of Urenco?

Boris Schucht [00:30:56] It's not a long time ago, two years ago, one year ago. It depends how... three years ago now, nearly. Anyway, COVID times in between, so that was a first experience. How to work in COVID times, we all learned that. A very big experience. But seriously, I think for us, my personal biggest milestone is that we as a company have ourselves committed to net zero. I call nuclear our CO2-free technology, but it is of course today not fully CO2-free because we have in like every windmill, the concrete that you use is, of course, there is some CO2 connected with the production of this concrete of the windmill. And also in the fuel cycle, you still have very low, but there are some CO2 emissions. And our ambition is that we can offer our customers, in 2040, already completely CO2-free fuel. So that means we have signed a pledge to fully decarbonize our industry and our activities on to 2040.

Boris Schucht [00:32:14] On to 2030, we plan to have already the Scope 1 and Scope 2 emissions down to zero. And we are on track on that, to be very clear. I think even a little bit ahead of track. The one element of that, Scope 3 emissions, which are the indirect ones, the ones by your supply chain, they are much more complicated and they are the ones that we want to achieve on to 2040. But however, on to 2030, the Scope 3 emissions should also be reduced 30%. So that is, for me, a very important milestone, delivering to our customers, in a few years, CO2-free fuel. That is our contribution that we can bring in there.

Boris Schucht [00:33:06] The second one that I think makes sense to point out, the fuel cycle in itself needs also to be closed. So there's uranium mining then there's conversion and then we are enriching the fuel and then we have enriched uranium. But tails, also tails. And so far, we haven't managed to close the fuel cycle on the tails. And therefore we built in Capenhurst, our U.K. site, a big deconversion plant to deconvert the UF6 tails into uranium oxide. And this plant is now in operation; it came in the last two years in operation. And by that we are one step closer to actually closing the fuel cycle. We have just the pilot going on where U.S tails are transported to the U.K., are deconverted, and then they will be transported back to the U.S., and there we have already in the U.S. a final disposal option. So that's the first time then that we have fully closed the fuel cycle. And that, I think, is something which is important. We have to show societies that it is possible, without huge problems, to close these fuel cycles. And that's why I'm very keen that we get that done. So these are the two ones that I wanted to mention. When you ask me what are the biggest milestones of the last two years, they are, I think, extremely important ones. The company's proud of them.

Adam Smith [00:34:41] Yeah, those are incredible milestones to be hitting, and I think that's very forward thinking of Urenco to be thinking about their own CO2 footprint. A lot of companies that want to go green and are really thinking about their carbon footprint not only have to think about their existing product, but their supply chain as well. So, if you're thinking from a nuclear power plant standpoint, you are part of their supply chain and you guys decarbonizing helps the nuclear industry as a whole decarbonize just given your critical point in the fuel supply chain. So that's that's amazing; I'm glad to hear that. What are some things people might not know about enrichment services or the fuel cycle products?

Boris Schucht [00:35:31] Oh, I hope a lot of things. I hope a lot of things. I think the most important is the less people hear from us, the better it is, because then we are doing our job well. The fuel costs of nuclear power plants, they really don't play, commercially, any role in the energy price. They are very, very minor. So here, I think what we offer mainly to our customers and by that to societies is really a reliable energy source. And this company always advertises with no missed delivery in the whole lifetime of the company. That's amazing; I must say that's really amazing. But that is where the company is extremely proud. I have never heard that from any company before. They are so focused on that and that is something which people don't know. So this company feels extremely responsible for the safe and secure supply of fuel to their customers. Energy security is, I would say, of highest importance, and the company is delivering on that very well.

Boris Schucht [00:36:57] What also not a lot of people see, yes, we have a huge capacity program in the background. We have a huge investment program to actually manage all that. And all investments which are not necessarily very visible. People are not aware of that. That's a big, big challenge for us in the coming years. We have, on the one side, to refurbish our existing plants while they are in operation because we don't want to take out the capacity, then capacity would be not enough for meeting the demand. That is a huge challenge. And beside that, we are also building up new capacity. So that will be a big challenge for us and that is also not very visible.

Boris Schucht [00:37:58] And last but not least, maybe to repeat it again, everything that we do on the medical and stable isotope side is an additional value. And also in this area, there are only very few companies who are able to deliver on certain isotopes and the dependency on special suppliers are even higher than in any other sector. So I think we have there, also, an obligation against our societies that we are offering there our solutions and our services that the medical sector has sufficient supply.

Adam Smith [00:38:50] Wow. Well, it seems like you guys at Urenco are very forward thinking. You guys are really seeing the industry and preparing for its growth and the expansion of your product lines. So, this has been amazing. We're just about out of time, so let me ask you one last question. Would you like to share a message about nuclear with our listeners?

Boris Schucht [00:39:18] I strongly believe that nuclear has a really important role to play in the future of the energy sector. Decarbonizing the world is nearly impossible without... It is impossible without adding nuclear. It makes a lot of sense to go for nuclear as a technology for on the one side, reliable supply, energy independence. But on the other side, to meet the climate targets and to be able therefore to hand over a world to our children and to our grandkids which is a nice world to live in. Nuclear can play there a very important and a very big role. Thank you.

Adam Smith [00:40:08] Boris Schucht, thank you for coming on the show. We appreciate it. This has been an amazing conversation. Thank you.

Boris Schucht [00:40:14] Very good. Thank you very much.