Closing Bell - Manifest Space: Space Gone Nuclear with Zeno Power CEO Tyler Bernstein 2/29/24

Episode Date: February 29, 2024

As commercial space makes its mark on the moon, spacecrafts’ power sources are coming under scrutiny. Solar powered spacecraft freeze upon sunset—but the problem may become obsolete in several years as more nuclear-powered alternatives come to market. Zeno Power co-founder & CEO Tyler Bernstein joins CNBC’s Morgan Brennan to discuss repurposing nuclear waste for fuel, the role of nuclear power in space and growing its client base from government agencies to the commercial sphere.

Lunar night is harsh. Temperatures can fall to minus 292 degrees Fahrenheit or colder as the sun disappears for two weeks at a time. Solar-powered spacecraft freeze to death, which is why the reawakening of Japan's slim lander this week was such an extraordinary surprise. And why Intuitive Machines commercial lander Odysseus is being powered down now as the sun again sets. In a few years, this problem may be obsolete. Xenopower has contracts with NASA to work with intuitive machines and others on lunar vehicles equipped with nuclear-powered alternatives.

And we have a novel design at Xeno that reduces the radiation and dose coming off of the Strontium-90 heat source that we're developing, that allows us to use less shielding material and have a heat source that uses this available abundant waste product, but for the first time is also lightweight, enabling broader usability terrestrially, but for the first time also in space. And last October at Pacific Northwest National Laboratory at DOE facility in central Washington, we actually successfully built and demonstrated our first Drontium-90 heat source, confirming these innovations and building what is the world's first commercial radioisotope heat source ever built and demonstrated.

Called radioisotope power systems, RPSs convert the heat from decaying nuclear material into electricity. NASA has actually been using them for decades on big-ticket space exploration programs, from Apollo to Voyager to the Mars rovers. Historically, though, it's always been very costly, and the regulatory hurdle is high. But Xenopower's co-founder and CEO, Tyler Bernstein, says his company's new product repurposes nuclear waste, a breakthrough luring funding from venture capitalists and already eliciting government contracts. On this episode, Bernstein discusses the technology, the market for this kind of nuclear

power, and when Zeno's systems will actually go to the moon. I'm Morgan Brennan, and this is Manifest Space. Joining me now, Tyler Bernstein, Zeno Power co-founder and CEO. It's so great to have you on Manifest Space. Thanks for joining me. Yeah, thanks so much for having me, Morgan. I think let's start at the beginning. What is Zeno Power? What do you do? Yes. Zeno Power is a company started back in 2018, originally out of Vanderbilt University, building a technology called radioisotope power systems. Small boxes the size of microwave ovens that take decaying radioisotopes, hot rocks that are naturally decaying over decades, and converting that heat into electricity, resulting in small boxes that generate electricity

for decades at a time. And this is not a new technology. NASA has used this historically to power every deep space spacecraft, Voyager, Cassini, Mars rovers. Every Apollo mission had a radioisotope power system on board. The US Air Force and Navy have also used these terrestrially to power remote sensors and naval buoys. But historically, the limited supply of material or extreme mass of these power systems limited their usability. And at Zeno, we're building building radioisotope power system using an available abundant nuclear waste product as fuel in a lightweight form factor for the first time opening a broad use of this technology in space and also terrestrially as we start to see the growth of operations and offering domains from the seabed to the Arctic to the surface of the moon, largely in the wake of a new great power competition with significant investments by both the government and industry. OK, so when we talk about sort of time where we're talking about reports surfacing and lawmakers warning about the possibility of Russia, for example, putting a nuclear weapon, a space nuke into orbit.

We're not talking about space nukes here, but we are talking about nuclear power capabilities that could be applied to space. That's correct. Not a nuclear weapon. We're talking about heat and electricity production from decaying radioisotopes. So, very different technology, but of course, they'll all run to the broader sphere of nuclear. Okay. So, I guess, talk to me about what this capability, because you said it's not new, but what is it that's new that you're doing and that's disruptive and cost-effective about what you're doing? Yeah. So historically there's two fuel sources that have been used to build radioisotope power systems, plutonium-238 and strontium-90. And plutonium-238 is what again,

NASA has used for every deep space mission. And it's a terrific isotope. It has great thermal properties, a long half-life. It's easy to shield so we can build a lightweight system for use in space. But plutonium has to be specially produced in nuclear reactors in multiple sites in the United States. And only enough is produced to meet the demand for marquee NASA missions. And we started to see the growth of demand for technologies like this as we see over 200 manifested missions to the lunar surface this decade, as we see the growth of mobility and the importance of mobility on orbit and how power systems like this can be a crucial

factor for those. So we're using a different isotope called strontium-90. And strontium-90, as mentioned, is an available, abundant, really nuclear waste product that's a liability to the U.S. taxpayer and the Department of Energy. And strontium-90 has been used in radioisotope power systems before. Over 1,000 have been deployed terrestrially. But historically, these systems required massive amounts of shielding. So they had, you know, weighed thousands of kilograms and produced enough power to power a light bulb. And we have a novel design at Zeno that reduces the radiation and dose coming off of the Strontium-90 heat source that we're developing that allows us to use less shielding material and have a heat source that uses this available abundant waste product, but for the first time is also lightweight, enabling broader

usability terrestrially, but for the first time also in space. And last October at Pacific Northwest National Laboratory at DOE facility in central Washington, we actually successfully built and demonstrated our first Drontium 90 heat source, confirming these innovations and building what is the world's first commercial radioisotope heat source ever built and demonstrated. How long did it take to build it? How long is it going to take to build future systems? Yes. So that was, you know, Xeno started back in 2018. We started this work with Pacific Northwest National Laboratory in 2021. So that was a little over two years of work with PNNL and internally to build that first prototype. And over the past three months, in addition to securing that, demonstrating that first prototype, we've had two other milestones that are putting us on a great path to begin building our full-scale systems this year. And that is first, in January,

we announced a contract with Westinghouse Electric Company to partner with them in utilizing their commercial radiological facilities to begin building our nuclear heat sources at scale this year. In late January, we also announced a public-private partnership with the U.S. Department of Energy that will be recycling a legacy source of strontium-90 that had been sitting in Tennessee since the 1980s, again, as a liability to the U.S. taxpayer and the Department of Energy, in recycling what has been this waste product to provide us enough fuel to build our first operational systems to deliver on the over $40 million of contracts we have with NASA, the U.S. Space Force, and the U.S. Navy, and fulfill the broader pipeline that we have beyond that. And again, with those three milestones, we've now demonstrated our core technology,

we've secured our initial supply chain, and we're on track to begin building our full-scale power systems this year, demonstrating them in 2025, and delivering them to our first customers in 2026. Wow. So you said over $40 million worth of customers across a number of different government agencies. Where are the biggest applications when we talk about this? Yeah. So we are right now primarily focusing on space and maritime markets for use of our technology. And these are both domains. And again, largely in the wake of our new great power competition, you're seeing significant investment from the U.S. government and from industry. And these are regions that are access and power constrained.

They're very difficult to get, and there aren't a lot of power sources to be used. And with those two factors, it's a great market for what we're building, a box that can be brought somewhere and generates electricity in that domain for decades, a foundational source of energy for operations in those regions. So we have a contract with NASA, for example, to power assets on the lunar surface. Of course, it's extremely exciting. The yesterday intuitive machine successfully landed on the moon, and they're going to be in lightness for about seven days where they'll be able to operate under solar power. And after those seven days, they're going to hit the 14-day-long lunar night that is dark and cold, and they're likely going to freeze to death. With this contract from NASA, we'll be working, and Intuitive Machines is actually a subcontractor on this program, to provide a power system to enable rovers that have heat and electricity, rovers and landers,

to have heat and electricity independent of the sun, increasing their lifetime from days to years. We also have a contract with the Space Force to power a small satellite with constant power and electric propulsion to increase the mobility of platforms on orbit. And we have a contract with the Navy to power undersea sensors and undersea infrastructure, large in support of maritime domain awareness. Again, placing power in these regions, enabling operations to occur in these areas that are both access and power constrained. I want to go back to the lunar piece of this specifically. But first, I mean, I have conversations with startups that are also focused on nuclear power and this idea of being able to basically send a reactor in a container box anywhere that you need and what that means for military applications, to your point,

or even just being able to set up in remote areas, et cetera. The fact that you're not focused on something like that, you're focused on sea and space and some of these more difficult places to reach. I guess, why did you decide to go there when so many others are going here? Yeah, you know, that is where we saw the market pull us. You know, early on in 2018, you know, again, this started at Vanderbilt University, my sophomore year of undergraduate there. And we started really with a market study of where are these regions where a box that generates electricity for decades could have usability. And we largely engaged with the Department of Defense and the government, and we received interest in everything from powering undersea infrastructure

to Arctic outposts to forward operating infrastructure to, of course, space and deep space applications. And we started to see the draw and the markets really pulling us towards space and maritime regions, again, because these are the most challenging domains where it's difficult to get and power is challenging. And a different dynamic here as well is these are regions where customers are not buying our technology because of the dollar per kilowatt hour of the energy that we're producing. They're buying it because we're enabling a brand new capability.

We enable undersea sensors to be placed in regions where they cannot operate today. We enable a lunar lander to operate for years instead of days. We enable satellites to fly in orbits that they cannot today. And by working in these markets where we're generating new capabilities and generating new value for customers, it changes the economics in a way that we see a lot more upside than some of these more competitive energy markets where, again, the ultimate fact of the matter is dollar per kilowatt hour. So these radioisotope power systems, we'll call them RPSs for short here from here on out. Do we see examples of these in spacecraft currently active in space, whether it's on orbit or undergoing deep space exploration right now?

Absolutely. Again, over a thousand radioisotope power systems have been deployed historically in space and terrestrially. In space, the current Mars rover that was launched in 2021 is powered by a plutonium radioisotope power system. The Voyager spacecrafts, the first human-made objects to ever leave our solar system, are powered by radioisotope power systems. Every single Apollo mission had a radioisotope power system on board that was left behind on the surface of the moon to power scientific payloads. So there's a rich history of the use of this technology in space. What we are doing is replacing this fuel source, this heat source, using an available abundant

fuel in a lightweight form factor that, again, opens up broader usability as we see these markets growing and the demand for this technology grow. And so you mentioned that you're going to be working with intuitive machines. We know this first lunar lander that just touched down successfully and has made history as such is not powered in this way. Is the next one going to? What's the timeline for this? So our contract with NASA and the public release we have is targeting 2026 and 2027 for the time period of when this technology will be built and potentially deployed on future lunar surface

missions. Got it. And you're not just working with intuitive machines. You're working with other commercial space players as well. That's correct. So, you know, Blue Origin is another subcontractor that we have on our specific NASA contract and certainly have engagement with other folks in the industry as well. Got it. What are the bigger applications? Is it going to be in the sea or underwater? Is it going to be in space? I guess, how big is this total addressable market? Do we even know yet? Yeah, so in the space and maritime markets alone, in a bottoms-up analysis that we've conducted, we see demand for over 1,100 of these power systems as we start to see the growth of autonomous assets in the maritime environment, as you see the growth

of industries and telecommunications and deep-sea mining and offshore wind monitoring in the space environment, as we see the over 200 manifest admissions to the lunar surface this decade, and we see the growth and the importance of mobility and space platforms. So we see the just space and maritime markets alone representing tens of billions of dollars of potential opportunity. But that is not necessarily our North Star. Where we get excited is about providing power that enables development and taking regions on and off this earth that require more power to develop as they would like to and helping them do so. And a lot of those are terrestrial applications. And over time, following the path of a lot of novel technology in the past, of starting with these more price-insensitive and cost-insensitive markets as these initial beachhead markets. And over time,

as we work down the experience curve, as we drive our price point down, as we increase the power of our systems, getting to a position where we have a box the size of a refrigerator that is generating kilowatts of electricity for years that can be buried underground for all locations in disaster relief scenarios, providing clean, reliable energy to help areas develop on and off the earth. You talked about cost per kilowatt hour, I believe, right? Yes. What are the costs, I guess, traditionally speaking, especially when you talk about RPSs, what do those costs look like? Where are you at in terms of those costs now? How much can they come down? How does that compare to other types of power sources? Yeah. So if you look at publicly available information, the plutonium radioisotope power systems that NASA uses are in the hundreds of millions of

dollars of total cost per system. Again, when you have a $2 billion Martian rover, and this is the power source that enables that, that makes a lot of sense. Strontium-90 radioisotope power systems historically have more been on the order of tens of millions of dollars, given the more available and abundant fuel source that Strontium-90 is. And we're building systems that are on the price of the order of those legacy Strontium-90 systems, but again, now making a Strontium-90 system that is lightweight, so it can be used more broadly terrestrially, but also in space. So again, kind of hitting that combination of a more affordable system in a lightweight form factor that enables broader usability. Now, over time, we do see significant opportunity to decrease

the price of these systems. Likely not in a position where we'll be competitive with mainstream energy sources, whether that is larger nuclear reactors or wind or solar or geothermal. But in areas that are willing to pay a premium for resiliency, we do see opportunities in those markets as we drive our price point down in the coming years. There's so much focus for better or worse. I realize there's a lot of myth busting that's attached to this about the safety of nuclear power. Your thoughts? The regulations are what keep nuclear safe. And there are very strong and strict regulations that we have to follow when we're building and deploying these technologies. And our technology has to go through tests to show that if it's on

a rocket that blows up, that it will stay intact. If it's on orbit and hits the ground, that it will stay intact. And we go through a series of tests to prove that. And radioisotope power systems have a rich history of use with a strong safety record, and so do, you know, largely nuclear reactors. And this is certainly something that the industry, you know, always battles with. And it's something we take very seriously, you know, but we have high confidence in the regulatory environment that we work in, and then the regulators from the Nuclear Regulatory Commission to the FAA. And, you know, one of our core values, Morgan, is that we work in, and then the regulators from the Nuclear Regulatory Commission to the FAA. And one of our core values, Morgan, is that we will never put our business interests over human and environmental safety.

And we take that responsibility very seriously, especially as we begin building nuclear hardware now, and again, have great relationships with the regulators to ensure that this technology can be safely built and deployed and enable these amazing new capabilities for the U.S. government or international partners in commercial industry. What does being a government contractor enable in terms of being able to navigate some of these regulations, which do span across so many different agencies? Yeah, you know, I wouldn't necessarily say that it enables new things from a regulatory standpoint, but certainly having the government support early on is terrific. You know, we have amazing partners in NASA and the Space Force and the Navy, customers that are frequently willing to take a bet on technologies earlier than

commercial industry. And, you know, there's a great quotation from one of the NASA executives who said that, you know, they see themselves, you know, being the first customers, taking on the risk, being the ones that will pay more for first of a kind technologies so that over time, as these technologies become commercialized, they can be opened up for use by NASA, but also the commercial marketplace. dual use technology where the government sees one of its roles in helping develop some of these technologies that can support the government, but also commercial industry, but be that first anchor customer to decrease risk and bring this technology to market quicker. It's like you just took the question right out of my mouth because I was going to ask about how you're approaching this in terms of dual use technologies and what that portfolio is going to look like and how it's going to evolve from government to commercial. Yep, absolutely. You know, we are right now, all of our customers are the government. But in almost all of these government programs, we have commercial sub

contractors that we expect and intend to be, we hope to be commercial customers in the future. So following, you know, a frequent track record of having the government be our initial beachhead, be our initial customers by 2026, with support of the government, we will have space and maritime qualified products that are proven and deployed that we can then go and sell broadly to the government, but commercial industry as well. I just want to circle back on space for a minute. So we talked about lunar landers. We talked about lunar landers. We talked about, you know, about satellites. When you start talking, when you start thinking about things like colonizing Mars or, you know,

colonizing the moon even, or some of these other, you know, kind of maybe longer term, but on the horizon, you know, human activities in space applications, I guess how necessary is this type of power source going to be to really see something like, for example, manufacturing in space and heavy industry in space? Nuclear is going to be a crucial component to the support of human ambitions in space.

Energy is foundational for all operations. And whether this operations on orbit, on the surface of moon, transiting from Earth to Mars, on the surface of Mars or beyond, you need power to do everything. And nuclear has multiple characteristics that, you know, lended a lot of credence in these areas. First, it is extremely long lived. Second, it is producing electricity independent of the sun or other external factors. And third, it has extremely high power densities. So you can have small containers that are constantly generating heat and electricity for a decade. And no other power source can provide those same characteristics. And when you're on orbit or transiting from Earth to the moon,

having a high-density energy source to to enable whether it's manufacturing or propulsion in these domains is crucial. When you're on the surface of the moon, you're in lightness for 14 days and darkness for 14 days. And if you want heat and electricity in those dark regions, nuclear is an unbelievable power system that can do this. When we're transiting from Earth to Mars, using nuclear can significantly decrease the transit time, decreasing the radiation that astronauts will receive and increasing the potential success of those missions. And on the surface of Mars, you know, we have two types of rovers that we've launched to the Martian surface before, some solar powered and some nuclear powered. And Mars is a dusty, in some places, dark area. And having a power source independent of the sun to provide this foundational capability for humans to thrive in those domains, you know, again, is going to be important. So, you know, again, for power on orbit

for manufacturing capabilities, power for propulsion, whether it is going to the moon or Mars, and for power on the surface of these planetary bodies to enable human settlements and humans to thrive in activities. You know, guys see nuclear playing a crucial role in all those areas. So final question for you then on all of this, and that is, we know that there's treaty in place in terms of nuclear weapons in space. We know that there are rules and regulations, not only for safety on earth around nuclear power, but also from a national security standpoint, intellectual property attached, the capabilities, how they could be used, not just for power, but for, for example, weapons. What does this look like in space? And are we going to have to see some sort of update to, for example, the treaty that's existed for decades now, or I guess just an

extension of regulations from Earth to space? Yeah. So, you know, we do not see any treaties need to be changed for the use of our technology in space. And, you know, again, that is proven by the fact that there is a rich history of the use of radioisotope power systems on orbit, on the surface of the moon, in deep space, on the surface of Mars and beyond. And I really do think that it draws that distinction between what we are building in a nuclear weapon, an extremely different technology with different implications behind that. Having said that, there are some areas where there are gray zones. What are the operations around nuclear power systems on the surface of the moon?

What are the safety zones, the exclusion zones? And these are areas where we're in active dialogue with think tanks, with NASA, and with under-industry stakeholders to ensure that this technology is safely and responsibly deployed. Again, given that it really is a crucial building block for United States, our international partners and commercials ambitions in the lunar, cislunar and broader space environment. All right. Tyler Bernstein, Xenopower co-founder and CEO. Thank you so much for taking the time. Appreciate it. Thanks for taking time as well.

Really enjoyed it. That does it for this episode of Manifest Space. Make sure you never miss a launch by following us wherever you get your podcasts and by watching our coverage on Closing Bell Overtime. I'm Morgan Brett.