057 Michael Crabb, SVP Commercial at Last Energy

Michael Crabb (00:00)
the human condition is fundamentally a fight against entropy. and like our ability to win is arming us with the ability to manipulate energy. And the more we manipulate and manage energy, the better we’ll be. And, you know, still a couple billion on the planet that don’t have access to energy.

like the market is so big like there is room for multiple hundred billion dollar companies like it’s just it’s so big and there’s so many applications and and you know Like like we can’t be all things to all people is a 20 megawatt unit We can do as many as you want But if you need like a gigawatt that turns on immediately like yeah, we can’t like I’m not gonna do that. It’s not a good fit for me

Or if you need like one megawatt, like there’s guys out there solving that I can’t that’s too hard for me And That’s okay Again, it’s just it’s just such a big such a big space that that there’s so much room for for lots of different participants and business models and I fundamentally believe

competition makes everyone better, right?

Mark Hinaman (02:03)
Okay, welcome to another episode of the Fire2Fission podcast where we talk about energy dense fuels and how they can better human lives. Today I’m joined by my friend, Michael Crabb, SVP Commercial at Last Energy. Michael, how you doing today?

Michael Crabb (02:16)
it’s great to be at it’s great to be really excited to finally finally do this with you.

Mark Hinaman (02:21)
Yeah, yeah, I’m really excited for this conversation. A little concerned that it’ll feel like a little bit of inside baseball. You we’ve known each other for a while and you might, I feel like we might self identify as nuclear bros. So apologies ahead of time for any members of the audience that have to put up with that. But I’m stoked to dive into your background, talk about Last Energy. I think it needs to be set up front. What you guys are doing is really, really awesome.

Super impressive. So yeah, we’ll dive in. Before we get to last, let’s chat about your background. Where’d you get your start,

Michael Crabb (02:58)
Yeah, great. So way back, I studied architectural engineering and realized towards the end of my degree that I didn’t want to sit in AutoCAD all day. And so I needed to figure out something else to do. Yeah. Well, so instead I traded into sitting in Excel and PowerPoint all day, I started in energy private equity. And the fund that I was in was part of a larger strategic company, a large independent power producer here in the US. And so they had deep background in gas.

Mark Hinaman (03:09)
Good choice.

Michael Crabb (03:26)
gas power and natural gas midstream markets, but really the mandate was to look at all energy generation. And this is back in 2011. And so to give you context, it’s when the shale play started coming in, right? as like wind and solar were kind of starting to come down the cost curve, the ITC PTC was still uncertain future. And so it was just really a, and then interest rates who can forget for the last decade, right? Have been coming down and down and down. And so

It’s been a really interesting decade to be in the commodity and energy space. More specifically, as I spent half a decade there as an investor, I did a little bit of domestic LNG, liquefied natural gas development work. So it’s kind of small scale, high horsepower applications. Oil prices went from 100 bucks to 30 bucks. It didn’t make sense anymore. I rolled in back to the corporate IPP and led corporate M &A and strategy.

And so started to kind of broaden the different types of business models that we were looking at investing, bought a gas fired plan up in the Northeast and joined the team here at Last Energy almost three years ago

Mark Hinaman (04:31)
Awesome. Hearing people that worked on the LNG projects, like I think people forget that LNG wasn’t a thing. Like we were going to import these systems, right? And then, and then suddenly we turned around and we’re exporting gas and exporting LNG to countries all over the world. Like, and now it seems so commonplace, but it wasn’t right. And I know. I use this parallel a lot with nuclear.

Michael Crabb (04:54)
Yeah, and well, in a lot of the same systems and processes, right, like there are a lot of parallels. I think the interesting thing for me is I got to participate. I kind of got a front row seat on a couple of different technology maturation curves, and some that worked and some that didn’t, right. So I was about halfway through on the solar side, like there was still a lot of skepticism about solar and wind in 2011.

And then, yeah, on the LNG side, right, in 2015, right, still a lot of skepticism, right? The first conference I went to, there was 100 people. And by the time the third conference rolled around, there were 1 ,000, right? And so now in the nuclear space, it’s sort of a different maturation curve. It’s sort of relearning. But I think that has its own burdens too, right? And we can talk about it more later. I think in some ways makes it harder.

is because you’re starting with a thousand and sometimes that’s not always a good thing. So it’s just very, the parallels and differences are really interesting.

Mark Hinaman (05:56)
So how did you get connected, well, I’ll say with the group, right? Because it wasn’t Last Energy when you joined, it was the Energy Impact Center. And you guys have kind of gone through this iteration of branding and strategy and developing your business, right?

Michael Crabb (06:11)
Yeah, would say the thesis was fairly far along by the time I joined. So there was definitely work to do to really flesh that out and become more public. But yeah, I joined when we were effectively operating Last Energy in sort of a form of stealth mode and continuing to test the hypothesis that those at the Energy Impact Center had built based on the back of over thousand different conversations and

the Open 100 and some of those other processes. I was looking for more of a growth opportunity. I had looked at every generating technology, but for nuclear over a decade of my career at that point. And I got connected to Brett, our founder here. And to be totally honest, took the first call just to practice getting into interview shape again.

Right? Cause it was sort of a, like a, it was a process. It was a mentality to pitching yourself and, you know, asking questions and answering questions. and I, I vividly remember spending the first hour, you know, just grilling him with questions because obviously the reputation of the industry had, had been so poor from an execution standpoint. And, know, I’m, I’m as much a deal junkie as I am a nuclear bro, right? I wanted to be building things and financing things. and, so after that conversation and some of his answers,

I said, okay, well that was actually way more interesting than I thought it was, but he’s gonna pitch his own book, so I better start reading up. And so that took me, it’s sort of a three month process, I think. Folks with my background from finance, energy, whatever, if you’re really motivated, then you start going down the rabbit hole. You start clicking on the blue hyperlinks and articles, right? You start, you’re ending up in, you

whatever database has all the different publications and studies that get referenced correctly or incorrectly as it may be. And pretty soon you go, oh wait, wait, what? It’s just a steam power plant? Like, wait, what? Like it just, it’s rocks that sit in water? Like, remember it, right? From a gas power plant perspective, like what we can do is crazy. It’s crazy. Like pulling out like blended liquids from 6 ,000 feet below ground embedded in

Pressurizing it sending it 2 ,000 miles to then light it on fire and spin a very finely honed gas turbine That ramps at a couple megawatts a minute, right? And make it more efficient and operate that free thing freaking remotely, right? I mean we were operating gigawatt gas combined cycles with 24

Mark Hinaman (08:37)
Yeah. And use the waste here to that to make it even more efficient, right?

Michael Crabb (08:51)
And, you know, in Pennsylvania getting gas from West Texas, right? Like that whole system is mind boggling. And when you compare it to, and there’s a lot of detailed work in nuclear, don’t get me wrong, but when you compare it to loading fuel and letting it sit for two years and having a seat, like that’s pretty, like that’s it.

Mark Hinaman (09:09)
Nein. Easy.

Michael Crabb (09:12)
So yes, that was like a real, and you don’t believe it either, right? You’re like, wait, why it’s, but it’s such a big thing. hear all that, like it’s so complicated, you know? That was a real light bulb moment for me. And then, you know, been very hard at work building and fleshing out the detailed business case for less energy based on my experience as an investor, right? What do investors need to see at what stages of the project and what pockets of capital are best positioned to take that risk?

and get exposure to those upside returns.

Mark Hinaman (09:44)
Yeah. Okay. So, so the progression was right. The podcast Titans and Nuclear stepping into the open 100 project, right? You guys have published work on that. That was where you kind of open sourced a nuclear reactor design. And then leverage that to say, like, can we build a product or generate a product that we can then go out and sell, but then innovate on several aspects of the business model. Right. Did I succinctly capture what five, five, six years of work in about 20 seconds?

Michael Crabb (10:08)
Yeah. Yeah, think that’s, yeah, think that, yeah, yeah, almost a decade down into 30 seconds. Yeah, I’d say that’s right. think the only, we like to nuclear power plant. A nuclear reactor is such a small portion of the plant. And I think the industry really does itself a disservice hyper -focusing on the one thing that we do really, really, really well and ignoring the rest of the stuff that as an industry we’ve done incredibly poorly.

And so yeah, we really are careful to say nuclear power plant, that is our product. It was part of that open 100 learning. It was part of our Titans of nuclear learnings, right? When we talk to customers, they said, hey, we really love nuclear power, but we go to the market and someone sells us a reactor and then we have to build the power plant. And you basically are starting from scratch as a utility. So that’d be the only net.

Mark Hinaman (10:59)
Yeah. How many people worked on that open 100 project?

Michael Crabb (11:04)
Yeah, I actually, can’t, I don’t know. was technically before my time. I was employee, oh, 21 maybe, but we had a number of, you know, there were some labs, there were some engineering firms, right? We had a host of service agreements, advisors, consultants, pretty much every way you can cut a relationship that existed at some form or another. And it was never really like,

Mark Hinaman (11:07)
Yeah.

Michael Crabb (11:34)
The beauty of that sort of open source process is it’s not like, hey, here’s design criteria and like, it’s, you know, gotta, it’s gotta be done and then it’s gotta go to contracting and now you’ve got your, no, was a, here’s like a set of ideas that, you know, a bunch of, you know, very smart folks like thought could help, you know, solve some of nuclear’s problems. the one great thing about the open 100 is everyone loves to criticize online.

And that was the best part. That was really the intent, right? Is we wanted industry veterans, regulators, couch potatoes, and everyone in between to say, hey, that doesn’t make sense. like, you hey, you get some guy that’s like, hey, I worked on seven power plants. You have to access that valve. Like, you don’t understand. You’ve got to maintain that thing every day. Otherwise, it’s going to leak everywhere, right? And so, you you post. And this is frankly a tactic that I use even in commercial negotiation or sales and discovery.

is you suggest something that is like very wrong and someone wants to correct you and they’ll give you more information because they’re correcting you and they feel like they’re in a position of strength and superiority. And you get just fantastic information when you present it that way. And that was the goal. think, even today, and I think this is a big difference from what I’ve observed from the nuclear industry more broadly. Like the nuclear industry has a learning

Like they want to show up in all their spaces. They want to be the expert. There’s this like this culture that they have to have all the answers. You don’t have all the answers and you can’t be. And so then they fake it, you know?

Mark Hinaman (13:10)
Like you’re engineers, right? You’re supposed to be able to know this stuff.

Michael Crabb (13:13)
Yeah, like, oh, yeah, it’s not gonna last for 70 years. Like, how do you know? Like we got to know. Yes, it’s like totally ridiculous expectation and the opposite of building a good company and a good product, right? A good company and a good product is at its core, a learning organization, right? What’s the Amazon thing is day one, right? Like we go into every sales conversation, every regulatory conversation, every commercial negotiation. Hey, what’s the counterparty trying to do here? What are they trying to solve? What have they scared about?

And how can we find a way to work together to address those things? Not, hey, we know the answer. Hey, we need you to do this. Because that just doesn’t work. That’s not how people

Mark Hinaman (13:53)
love that you highlighted that. One of questions we had was how has podcasting helped your efforts? Because you guys have the Titans of Nuclear podcast, the Energy Impact podcast. But I’ve seen that in my career. That’s why you have conferences and consortium and friends that are willing to talk to you and help you solve problems and address stuff together. Because it’s a way of getting more information, just like you say, learning. Stepping through this learning curve. think the problem that I’ve seen with the industry is

trying to learn or optimize some of the problems too early or optimizing the wrong problems. And rather, if you try and build fast and fail fast and gather as much information from other people in the space as you can, yeah, you can learn faster.

Michael Crabb (14:41)
Yeah.

Yeah, I think, you know, it’s a lot that helped us. I think it was really fun to highlight some of the people in the space, right? Like, it’s really, it’s one of the highlights or like the joys in my life is getting to talk to people that have done really cool things and maybe no one’s ever asked about or taught, you know, outside of maybe their close knit community. So, yeah, it’s been really fun to meet those people and then to share with those people. And for us, we learned a ton along the way and have built additional relationships, right? I’ve built advisor

Mark Hinaman (14:59)
Yeah.

Michael Crabb (15:12)
or consultant relationships or supplier relationships. So it’s really been a, yeah, it’s really been a fun platform and I know you’re kind of on your own journey as well. excited to see where you take it.

Mark Hinaman (15:22)
Awesome man. Well, give us a 30 second description of what you guys are trying trying to do What is this nuclear power plant that you’re you’re selling and the business model you’ve adopted?

Michael Crabb (15:32)
Yeah, so Last Energy is a builder owner operator of a micro nuclear 20 megawatt power plant product. are combining what we view as the best of three different worlds.

That’s your pressurized water reactor nuclear technology. We have no energy generating technology under the planet, like on the planet and throughout all of history that is as energy dense as sustainable, right? The fewest materials in for the most materials out and that exists and is broadly available today, right? Like, like uranium exists everywhere. And so from a technology perspective, we’ve got, you know, 70 years now of operating history. Like that is the premier energy generating source on planet

And then we try to steal the best things from two other industries. The second is modular manufacturing and assembly of the entire power plant. So every reactor in some form of fashion is like, is modular, right? I mean, like a pressure vessel. But that doesn’t actually solve the construction challenges. The challenges haven’t been reactor. I Hinkley Point C just started on their reactor, you know, eight years after starting construction, right?

The problem is one both of scale and of modularity of true modular construction. And what are the industries that have done that really, really, really well? Right? Well, it’s data centers and the oil and gas space, right? You’re able to the oil and at different scales. So your oil and gas modules could be enormous, right? Offshore platforms. But you think about gas skids, you think about processing plants, right? Like they’re in the middle of nowhere, West Texas or Panhandle, Oklahoma, like

You gotta be able to get the equipment there and get it set up and moving. It’s gotta be fast and it’s gotta work, right? Data center space, same thing. I don’t know how serious this comment was. was like, it’s a million dollars a minute if a data center’s down. And now that they’re bigger, it’s probably more. It’s gotta get there, it’s gotta be online, it’s gotta work, and it’s gotta happen fast. And there’s a couple data center providers in particular that are very good at, hey, here’s our module. If you want more compute, we’ll just give you more modules.

And so that’s the second leg of the stool. And the third is the developer led business model. I like I’ll get on my soapbox a little bit. I just can’t stand the nuclear entitlement. Hey, I want to like sell a utility or reactor for a $4 billion. And like, they’re going to do all the work like that hasn’t been the way energy projects have been developed for 30 years. I did a speech on this at a nuclear conference in the Netherlands. And in doing that realize

That was before video streaming. Netflix existed a couple years after energy markets liberalized. Think about that. The last time the business model that most of the nuclear industry talks about existed was when you could still go to Blockbuster. We have to move on. Yeah, yeah, yeah. We have to move on. And it doesn’t actually matter if you think that’s a better model because tough shit. That’s just not what it is.

Mark Hinaman (18:30)
like years before Blockbuster went bankrupt, right?

Michael Crabb (18:43)
And so we have to start stop pretending that, you know, the government’s going to swoop in and solve all of our problems and utilities, you can be forced to do it because it’s such a great source. Now we have to take like real responsibility as an industry to develop and build our projects. That was true for LNG, it true for solar, it was true for batteries, it’s true for hydrogen, right? It’s true for everything. And the beauty of that is that skill set exists in space, right? That is a like a real estate

skill set. And so if you look at our team, like I can’t find that skill set in the nuclear space because no one’s done it. But you know, we have we have biomass experience, I’ve got gas and LNG experience, we’ve got distributed solar experience, we’ve got energy from waste experience, right? So it’s all these folks that have seen similar processes. And the paperwork’s pretty similar. Maybe it goes to a different acronym, right? It goes to a different body. But there’s only so many ways you can look at a site, right? There’s only so many species you can examine.

or weather patterns that you can evaluate. And the beauty of nuclear is actually most of those things are somewhat irrelevant, right? Because it can be so self -contained. And so really those three aspects, you if you step back on a purely first principles basis, you’re like, hey, we’ve got this fantastic energy source. We’ve got these proven construction methodologies that people are already really good at doing. And then we’ve got this business model that, you know,

I think it’s almost in the trillions of, you know, dollars a year globally that go into right from 500 billion five years ago, like, hey, wait a minute, like, this is starting to look pretty pretty darn good. Right. And so we sell energy to people that need energy. And we, you know, bring a creative investment opportunities for people that invest in infrastructure projects. It doesn’t have to be much more complicated than that. And then obviously, if you dig in the underlying contracting structures become really critical, right, how you allocate risk, who’s doing what

That’s where the magic really happens and that’s true regardless of the generating source, right? You have to have good contracts in order to make that all

Mark Hinaman (20:44)
Yeah, I want to touch on this point, just comment on it a little bit because it is so relevant and nascent. When I was doing my own work and researching the space, I kept looking into the industry and being like, where are the companies? Right? Like, because I come from the oil and gas industry and they’re the operators and they’re like out there doing stuff, building projects, like actually putting steel in the ground and like acting as the general contractor. Right? That

the company and oil company, right? And that didn’t, like you say, exist in the nuclear industry. It’s not, I mean, there weren’t quote unquote nuclear companies. There were widget designers that were building reactors and then they to try and sell those two utilities. And like that business model is, it’s hard. It’s a really hard business model because you don’t have control over a lot of it, right? And so I really admire that you guys have adopted that. I mean, it’s you, it’s Oklo, it’s Aloe, right? Like that are stepping up to say, hey, let’s go

Michael Crabb (21:21)
Right.

Yes.

Mark Hinaman (21:41)
fill that unmet need and have some ownership in this.

Michael Crabb (21:45)
Yeah, yeah, it’s that alignment of accountability, right? I think you can see in some of the other public filings and there’s different things out there where for some of these companies, the consulting contracts is actually where most of the value is, right? And particularly the incumbents, you get a government, you get a utility on the hook, and once someone gives you 50 million, oh, just another 10 more to do this, another 20 more to do this, right? The incentive.

Mark Hinaman (22:10)
Which isn’t actually creating value for the world. Like, not creating electricity with those contracts.

Michael Crabb (22:12)
No value. Yeah. Crazy. Like just turning, turning paperwork around, right. And escalating costs and doing more design work, right. Like it is literally infinite. So you can be like, you have to manage those people. Right. And it’s true outside of the space, right. Like, you know, I yeah, yeah, that’s the business.

Mark Hinaman (22:29)
I’ve had that noiling ass I’ve managed EPC firms that you know they send the first proposal and they’re like all right it’s gonna be a million dollars to design this facility and I’m like that’s cool my budget’s like 25 ,000 so we’re gonna scale it back a little bit and that’s that’s what we’re gonna hit.

Michael Crabb (22:42)
Yep. Yep. Yep. And we don’t need perfect, right? I need good enough anyway. And so Yeah, I think that it can only be done in this model. Like even with government support and like government can help fill gaps.

the same way they’re doing with other nascent technologies, but it has to be led by the industry and all about creating value for customers, right? If you lose that part of it, then you’ve gone too far off, right? It won’t be successful if that’s not the prime focus.

Mark Hinaman (23:10)
Yeah. You guys have announced lots of deals or you can find some headlines and articles that say like billions of dollars of deals and projects. How are those going? then also, mean, Brett’s been interviewed and says, you know, he gets excited about other people stepping into the space and not necessarily copying exactly what you guys are doing, but emulating and replicating.

I’ll just say like my opinion is that’s going to be so helpful for the industry. If more people get in and fill this developer role. And I feel like a lot of people within the industry don’t see this. say, well, but then they’re competing. We’re competing for who we’re going to be selling energy to. And it’s like, no, no, you’re not competing with each other. You’re competing with other power producing companies. And if there are other people stepping out of the space and that makes everything else that you need to build your product even cheaper.

Michael Crabb (23:55)
Yep.

Yeah, okay, wow. Yeah, no, no, no, no, but actually two really good themes. So I’ll do it in order. I’ll talk about our contracting strategy and status and pipeline. And then I’ll talk a little bit about that idea of competition and how I think about it. So yeah, I generally our PPAs are 15 to 25 years. And so when you look at, know, our average,

Mark Hinaman (24:04)
That was a comment more than a question, please.

Michael Crabb (24:29)
I actually have to look at this again, given some of the recent traction, but generally our average is four and a half units per project. So, some are eight, nine, 10 units and those will scale in over time. Others are onesies and twosies. But if you take that as a baseload energy product over 15 or 25 years, you’re generating like pretty enormous streams of revenue. Now there’s a lot of hands at the cookie jar that, as that walks down the depository agreement, of course.

But yeah, mean the beauty of the energy space is it’s just so damn big. the other beauty, and this actually plays right into the competition story, is we’ve never actually transitioned an energy source. Right? We’ve never transitioned, we’ve only added. Still burning water, we’re still burning coal, we’re still doing manual labor, right? Like we’ve only layered additional energy on top of it. And yeah, I think, look,

Mark Hinaman (25:12)
Yeah, we’ve kept earning wood and coal.

Michael Crabb (25:25)
Everyone loves the AI story. think there’s like reshoring and manufacturing and there’s electrification. Like the human condition is fundamentally a fight against entropy. And that’s, and like our ability to win is arming us with the ability to manipulate energy. And the more we manipulate and manage energy, the better we’ll be. And, you know, still a couple billion on the planet that don’t have access to energy. So I think it just underscores like humans, like our problem with large numbers, right? Like our biases, like our difficulty.

wrestling with large numbers is that like the market is so big like there is room for multiple hundred billion dollar companies just just to like Get halfway there Yeah, like like like it’s just it’s so big and there’s so many applications and and you know Like like we can’t be all things to all people is a 20 megawatt unit We can do as many as you want But if you need like a gigawatt that turns on immediately like yeah, we can’t like I’m not gonna do that. It’s not a good fit for me

Mark Hinaman (26:05)
at the current size of the market.

Michael Crabb (26:24)
Or if you need like one megawatt, like there’s guys out there solving that I can’t that’s too hard for me And that’s that’s our sales process right is like a discovery like what’s the can we add value to this customer? And sometimes they think you can sometimes they think you can’t sometimes they’re right. That’s okay Again, it’s just it’s just such a big such a big space that that there’s so much room for for lots of different participants and business models and I fundamentally believe

competition makes everyone better, right? Like if you think about the sports analogy, like the nuclear industry, they come to the practice field, and they’re really nice and they’re hugging everybody and they don’t do a lot of work. And then they walk off and then each position group says how lazy the other one is or how crummy the other right and like off the field really sharp elbows and then they get to the game and we’re getting our ass kicked. Right? We got 40 losing seasons. And and and then we’re just like so happy that our culture is so good. Right? Like that is that is like what I like. That’s the nuclear industry.

Mark Hinaman (27:21)
Thank

Michael Crabb (27:23)
And that’s not it, the way you get better, the reason why solar has gotten so good and so fast, because it is so competitive and like people will lose, people will go bankrupt and some people will win and they’ll be enormous and that talent will take those lessons, right back to learning, different, the talent will take those lessons, they’ll go on to the next one and it creates this just like unstoppable momentum of new ideas, even in the light of a bunch of failures.

So like I think I saw a stat the other day 650 635 solar projects got cancelled last year in the US But no one cares because 1500 got started Right because there’s a hundred companies with like oh doing this rooftop niche or this distributed thing or this utility right like everyone’s got an angle and and so I just I Hate how short -sighted and how fixed

high the nuclear industry really is. And I think there’s some reasons for that, some logical and like some rational and some a little bit more like nefarious. But broadly, if we want to be successful, it has to be a market where we let we let the results on the field dictate what what is a winner, what is it? And and like, yeah, I’ll leave it there. I can go on on this.

Mark Hinaman (28:35)
Yeah, absolutely.

I like it. So who’s your typical customer? Where are you finding these people or what’s your archetype of an optimal end user look

Michael Crabb (28:51)
Yeah, I would say I mean, obviously, the data centers data center space has become a really, really hot one. It’s a space that we’ve been involved in. And, you know, shit, frankly, since I got here, even way back two, three years ago, before some of the AI boom stuff, like data centers were good customers, because they had been buying corporate power for a decade. And so they were a lot and they are a baseload consumer of

And then you add the environmental sort of targets on top of it. So they were a really logical customer set. I would say over the last 12 months, that has gone as just sort of like gone into super duper overdrive. Yeah, Pun in hyperdrive. I like it. like it. And I think some of that is real. I think some of that is a nature of that competition, right? Everyone’s kind of vying for the same

Mark Hinaman (29:33)
Maybe hyperscale, right?

Michael Crabb (29:48)
the same end customers. But yeah, it’s probably about half of our book at this point, to be honest with you. And certainly some of our earlier, or like our most matured, the first few projects are likely to be data centers. And then there’s this sort of mid, I’ll call it mid -scale manufacturing. So yeah, think of any type of industry that might be large enough for their own gas CHP unit, or their

like set of gas peekers. So, mining about you, thank you, thank you. I’m still bad at using acronyms sometimes. So yeah, so pulp and paper. you have some food manufacturing, some petrochemical, metals and mining. Some of those will take heat as well. Some of them are just purely electric or some are electrifying, right? Maybe their electric need has been pretty low, but they’re adding an arc furnace. Some of those

Mark Hinaman (30:18)
CHP, combined heat and power,

Michael Crabb (30:45)
really big. Some of those are less real too, like we’ll see.

Mark Hinaman (30:52)
Any behind the meter EV charging stations? I feel like your guys’ plan would be

Michael Crabb (30:55)
So charging is hard. So we need a couple of things to really make it work. We need a customer that has a baseload power need, or is willing to pay for availability. So we don’t need someone. And I can talk a little more about that in a second if you’re interested. And then we need a counterparty that has credit.

Mark Hinaman (31:01)
consistent flat flat

Michael Crabb (31:23)
or can buy credit in order to backstop their obligation to pay us. If you think about the deal, our investors are bringing in 100 million bucks up front, and then their return on and of that capital comes over 15 to 25 years. And so the counterparty has to be able to say, yes, I’m going to be around to pay you for that period of

Now there’s a whole host of ways to structure that and address that and sort of allocate costs of that credit. And that’s, you know, that’s my bailiwick and history from a decade of being on the investor side, needing that credit to make it work. But it’s with EV charging in particular, they tend to be much less mature, immediate counterparties developers, and then they don’t have tenants that have credit either, right? Especially if it’s a public charging station that you can’t like syndicate credit,

credit amongst anybody that will use

Mark Hinaman (32:19)
It’s not like we can guarantee that people are going to show up to our EV charging station in next 20 years and be plugging in.

Michael Crabb (32:21)
Yeah, yeah. And so early we said, okay, one of the things we did look at is, what about a captive charging station? Is there a, like a FedEx or a UPS, is there a return to base process that could make a lot of sense? And generally we’re a bit big for that. Like 20 megawatts would be some like a serious fleet trucking and that’s generally not returned to base, right? That’s generally more intermodal. And so I think there’s some unique aspects

Some of these like mobile generator or mobile reactor type concepts that are smaller, maybe that they like better ramping capabilities. Because again, then it’s overnight. And so it’s it’s all on, it’s all off. Again, there’s ways to address that and spill to grid, but it just so you can start kind of going through this process, it’s getting really, really complex. And we said, you know what that like, we got enough to worry about. If I can site next to a data center, I could build five or six or seven units.

and just sell power and focus on the other stuff. So that’s where we ended up on the EV charging

Mark Hinaman (33:27)
Gotcha. Circling back to learning, how different is your guys’s, I guess, current design from the Open 100 project? then you guys have built some stuff. Like you’ve got your cube demonstration. You’ve got multiple demonstration prototype, full scale prototype, reactor vessels and steam generator. Like how has building those and doing those physical projects actually taught you stuff about how you’re going to go and build the real plants?

Michael Crabb (33:53)
Yeah. Yeah. I don’t know if we have another few hours, we could, we could. Yeah. So I would say, I would say very different from the open one on trend, right? I mean, that was 2018, 2019, whatever, maybe 2020.

Mark Hinaman (33:56)
Hahaha.

All right, they’re bringing up the big questions. I’m curious. I want to know.

Michael Crabb (34:14)
I think it was a hundred megawatt maybe. yeah, very, the product has come an incredibly long way from that original set of ideas. I think even at the, was confusing to some customers. We’ve taken some of the like more material docs down. But yeah, so the product itself has definitely gone through a number of iterations now and has become quite defined. And a large part of that were these couple of different prototype processes.

So it was like two main things that you learn when you actually build stuff. The first is just the technical side of it. So for instance, we had a structural steel design for our first prototype. And we did it because it was a little bit cheaper than an alternative that we were considering. And then we went to fabricate it, we realized it created a lot more managerial headaches to ensure that the orientation was

And I said, well, we can’t have that. how stupid would it be to like bring all of these modules to site and have one of the like, one of the connectors like have the wrong orientation. Like, like, you know, it’s not Ikea. And so, and you see, you gotta screw it up and you gotta like really test. Yeah, you gotta really test it. And I also will actually, this is a good way to plug as well. It can feel a little dorky.

Mark Hinaman (35:29)
That stuff happens, man. You gotta screw stuff together in person. Real hard steel.

Michael Crabb (35:41)
we do a ton of both 3D modeling and then 3D printing and then like very small, like what seems like kind of silly experiments, like desktop level experiments, but you just, you have to like kind of play with stuff and so many ideas come out of, you know, really visualizing something. It looks different than it did on the screen, right? Like it’s got a different consistency or that elbow looks really tight, right? Like you just have to go through that process in order to come out with a good

with a good product. And even still, maybe the other thing that I’ll step back and say, we’re not building our own manufacturing facility until we build a few like, like, we are subcontract. Yeah. And guess what they do a lot more than we would or get right. Like I like again, like let the people that are like do the thing they’re really good at. This is this is for us to learn to manage other people not to actually do it. And that’s the second leg that’s so important contract management contract structure, owners engineer

Mark Hinaman (36:19)
Why would you? There’s already existing manufacturing facilities that can do this better than you.

Michael Crabb (36:41)
right? How do we get people on site? So the first two we did were in Texas. That’s pretty straightforward. We have the same jokes, you talk about the same football teams. Well, the third we did in Poland. And so now you got the time, you know, flew folks out there and they stayed out there for, it took about five weeks to put that module together. But the team was just fantastic. You know, the thing about I think it’s like some Eastern European, like culturally are just so technically oriented and they

you know, hey, what if we use this jig? They knew we were like looking to do more with them and we are, we love working with them. Like, what if we use this jig or, you hey, have you thought about structuring it this way? They did this like laser etched plate to show how excited they were. It was just a really great experience. And part of it was we were more prepared going in because we’d done it twice, right? So we knew we had to give, hey, here’s where you got to give more direction. Here’s where you can like, you know, take their input, make them feel a part of the process. Like they’re the experts, we aren’t.

We know what the output needs to look like, but hey, how can we make them our partners in this and not some confrontational type relationship? so yeah, those would be the two main themes, I guess. And you have to just keep iterating as an organization and get better at stuff like accounts payable, right? Like, you meet the contract, right? It sounds so silly. It’s so boring.

Mark Hinaman (37:54)
It’s so boring. It’s so boring and yet it’s so necessary. It’s what makes a good business.

Michael Crabb (38:00)
Yeah, you gotta do it, you gotta do it. So yeah, I mean, we’ve definitely grown, definitely become more institutional, we’ve got more growth to do. And I hope we always have that mentality, right? And you’re always growing, you’re always getting better. And it’s always day one.

Mark Hinaman (38:12)
You mentioned Poland, right? You guys have some projects in Western Europe and Eastern Europe, but not in the United States. Why not the US? And then do you think that’ll change with some of the, some of the advance act? I’ll say legislation that’s come out and or, I mean, I’ve got more follow -up questions to that, but yeah, let’s start.

Michael Crabb (38:30)
All

Yeah, let me let me start there and then dive in don’t let me just word vomit at you I think yeah, I think definitely like You know, we’d love to build in the US It’s always you know, what’s the like, know, would you want in your backyard like unequivocally? Yes, like absolutely I would love nothing more than then to you know, have this here domestically when we think about it from a business perspective There’s like there were a couple There are a couple key challenges for

The first was just the economics. That here in the US, we have access to really cheap gas. There’s no real carbon tax. So any environmental premium is voluntary. And then our tariff structure is generally regressive, meaning if you’re a large energy consumer, so these would be our customers, you pay less on your transmission and delivered cost of energy versus more.

So that’s really hard for us. So you got cheap power and a lot of, a lot can be solved with tax credits, but again, a huge complexity, right? Tax credits aren’t like a panacea. you

Mark Hinaman (39:38)
It’s not straightforward. It’s not like, yeah, we’ve got a tax credit and then the government just sends us money. You have to have like a tax obligation, right? That is of the scale.

Michael Crabb (39:47)
You have to have the tax obligations. Now you’re managing all of these interim structures, right? You have deficit restoration obligations. And then you have to make sure you’ve got the right content, right? You’ve got, even in the IRA, a lot of guidance still outstanding around how you think about the broader claims of what the IRA defines. So I just couldn’t add that risk to our initial deployments, right? Like I had to, my team has to focus on what it can control and how it can execute.

And if you add that like structural complexity and tax equity is super risk off, right? Like no one’s going to do tax equity at like a first deal, just too hard. And so from an economic and sort of structural perspective, didn’t make sense. Now in Europe competing, and it wasn’t always Europe, Europe really solidified around the gas crisis driven by the Russian war and the intermittency challenges six months prior. So UK costs actually escalated six months prior to the Russian invasion.

I think you could put your tin foil hat on, there was probably some correlation, right? There was some weakness that Putin recognized, right? It’s not been a secret in Eastern Europe. People were worried about their exposure to that gas. And so yeah, they’re a global LNG price market. They have carbon taxes that are escalating. They’ve got old generation that’s retiring. They’ve got a bunch of intermittent generation that’s causing price volatility. And then they pass on that intermittent cost to the end user.

And so now I can charge double what I would here in the States and still save my customer 30 to 40 % on price. And so that is that sort of win -win that like, now I’ve, you know, economics that I can go and do all of these other things that I’ve talked about doing, right? Versus playing with a really thin margin, everything having, you know, having to go right. And then the other aspect of it is the regulatory process as a new entrant just has a very poor track record here. And so

Mark Hinaman (41:43)
It’s a high barrier to entry,

Michael Crabb (41:45)
Yeah, particularly for a new entrant, like it just is too hard and you’re competing against folks that don’t really want you there, right? Like it is competitive and it’s an industry with really sharp elbows. And so, yeah, I think the, I would say more broadly, regulators get a lot of shit in the industry. And the more that, the more we’ve been involved with regulators and the more we engage like with broader industry, I side with the regulators more than I do industry.

I think like submissions have been, have generally been poor. I think there’s like not real projects, right? And in Europe in particular, in Eastern Europe, generally they’re like government projects crammed down, whichever like state on entity is there. And, you know, they’ve spent $500 million and haven’t really gotten anything yet. Right? So it’s like, I think the regulators are generally well -intentioned and, and very naturally highly skeptical.

of anybody in the space because it’s been so poorly executed on. And so eventually that turns usually to our advantage as we mature in these relationships because we read all those documents, right? We put it in their local language, right? Like who cares about US code if I’m submitting something to someone in Romania? It’s Romanian code that’s gotta match. And so that actually has really helped us and continues to drive our confidence and the ability to execute in these markets.

Mark Hinaman (43:11)
Nice.

Michael Crabb (43:12)
And the final thing I will say, if you think about that framework, right, it’s not really the regulator’s fault. I think that’s really true in the US too, in some respects, that like, it’s the law as written. It’s shitty that it’s written that way, right? Like it makes it impossible to build anything, but that’s where that advance act, bipartisan support, right? Like nuclear has always had incredibly high support here in the States. So like, yeah, I think there’s a lot of momentum and I think the biggest risk is can we as an industry,

be constructive with those tailwinds, right? Because no one’s gonna come in and say, hey, here’s the right framework, but the industry. And so if we can align on, hey, here is what needs to happen, here’s how the EPA does it, here’s how we can create the framework to accommodate for benefits, right, versus risk, or here’s how we can make a, you know, here’s the size cutoff, everything below that has a lighter, you know, this is other research reactors are this size, like that should be the process.

Like the industry has to dictate that because the government can’t. They don’t

Mark Hinaman (44:15)
thought reading through it and listening to the webinar, I thought you guys would have been a good fit for the Gen 3 plus light -watt reactor process that the DOE has put out recently. Notwithstanding, think that you have to have a utility V prime on that agreement and it doesn’t really fit with your model, but I don’t know.

Michael Crabb (44:31)
That was a weird, that was a weird clause. Right? Like that was weird. Like why, why define that way? I think it’s a little, again, it comes back to like, you know, having to learn

Mark Hinaman (44:42)
I guess maybe there’s too much inside baseball too, right? This was a grant that, giving listeners a perspective if they don’t know, right? This was a grant process that’s just started in summer of 2024 that the Department of Energy has released to put about $800 million towards a light water reactor project, right? And it’s pretty, a little ambiguous about what exactly that could go to, but yeah. In reading it, I was like, these last energy should apply and like, use it to go through the licensing process.

Michael Crabb (45:06)
I like

I know, look, we’ll see. Never say never, we continue to monitor how stuff’s moving forward. Like we continue to spend a little bit of time, like keeping an eye on it, like involvement here. So yeah, maybe, look, the window hasn’t closed, right? So we’ll see. There’s a lot we have to focus on execution -wise in our existing projects. And so, you know, that’s part of the trade -off here.

And yeah, I would say philosophically, what you just said like is an argument. Hey, use that money and go through the licensing process, but we keep doing that. That doesn’t solve the underlying problem and it’s not scalable. So it just actually reinforces the problem. If I get 400 million bucks from government to go through a licensing process that costs four times the size, the cost of my entire power plant. Okay.

Mark Hinaman (46:08)
What are we doing here? And then you’re going to have to go and do it again?

Michael Crabb (46:09)
What are we doing? What’s the next one? Let’s say you cut it in half. You’re making my permitting 200 million and my power plant 100. That is crazy. Unless I don’t sell electricity. If I don’t sell electricity, then it’s maybe 10. That’s the kind of stuff we need to address the underlying fundamental problems with the policy. To be fair, NRC is just enforcing the law. And they’ll tell you that.

Sometimes that’s genuine and sometimes it isn’t, they wanna do stuff too, right? They just don’t wanna have these sort of half -ass applications because no one cares because the US government’s on the hook and everyone knows it’s their own tax dollars that are going to this project that has no chance of seeing the light of day. I don’t know, I’m a little bit too onerous on some of those things.

Mark Hinaman (47:03)
Let’s go.

Michael Crabb (47:04)
We can talk about some of my perspectives on the broader space. Cause I think things like

Sometimes I’m too negative. think…

Mark Hinaman (47:10)
Capital markets. How are capital markets viewing nuclear as an opportunity now? Yeah, doing a bad job as a host here letting you get too down.

Michael Crabb (47:15)
Yeah, thank you. Pulling me off on it. That’s good. Look, really excited. Yeah, it’s good. good. good. It’s good. The capital market space has never been more interested in nuclear. And you don’t have to take my word for it. We now have three public comps that are going like absolutely gangbusters. know, Fusions raised God knows amounts of money and even Fission has raised a ton of private money over the last three, four years. So

You still see people in the space say, private capital markets can never do nuclear. And I would say absolutely bullshit. Anyone peddling that message is probably, if they aren’t in the exact same breath, the next breath, asking for money from government. And so it’s helpful to your case to say private markets can do it. But guess what? They have and are. We’re on Oklo, Nano.

New scale, obviously, and then a host of private fundraisers, some of which are public and some of which are private, right? Like there is a ton of activity in this space. What we need now are real projects, right? And so that’s where our focus on maturing those off take agreements, land agreements, grid connection agreements, right? Like we’re right on the cusp of being able to bring some of these markets to capital markets and figuring

And really the hard part, which is that early deployment capital, right? This is not a nuclear thing. This is an industry thing. And there’s a lot of different ways that the industry is thinking about it and that capital markets are trying to solve.

Mark Hinaman (48:52)
Early deployment capital, that’s like the seed funding, the money up front to go and originate the project, build the first one. Am I thinking about that correctly?

Michael Crabb (49:01)
Yeah, yeah. And generally, you can think about a project lifecycle similar to a company lifecycle, right? Where you like, if you have a good marketplace, you structure it such that lots of projects can start with very little money invested. And then as you get more mature, it’s a little bit more money. And that right and yep, and you go from C to series A to B, right? And it’s bigger checks, but it’s less risk, it’s maybe less upside. And so, you know, development capital and then project capital.

or sort of your traditional baskets. Now we’re taking a little bit of of a, a, an adjusted view to that because our model allows us to almost treat the product, the thing, the power plant can exist anywhere in 3D space and still produce electricity at the low, at the low end of the voltage. And so that allows us in our markets, they’re all 50 Hertz,

to place that product anywhere in those markets. And so we’re able to manufacture ahead of what would be a traditional single project FID. But that is corporate, it is likely corporate capital or some form of structured capital at the top co -level that will support that funding.

Mark Hinaman (50:15)
Gotcha. Yeah. Michael, we’re coming up on our time. I knew this was going to happen that we wouldn’t have enough time to go over all the things that I wanted to chat about. I’ve got a strong sense of ownership. So as the host, it’s my responsibility to keep you on track. A couple of just last questions as we wrap up. is climate change still our greatest challenge or is this idea of energy prosperity, energy abundance?

Michael Crabb (50:23)
It’s my fault. You let me rattle on.

Mark Hinaman (50:42)
Yeah, and Brett always talked about on his early episodes, like he got into it with climate change. And then I think there was one episode he’s like, actually, think energy poverty might be more important.

Michael Crabb (50:53)
I think he’s definitely taken a bit of a shift. I would lean on balance to like an energy abundance question, just philosophically, right, going back to my earlier comment, that’s the fight against entropy. And our ability to have more energy will help us adapt to whatever climate throws at us now or in the future. So I think the answer is how much energy can we generate and as sustainably as possible.

Mark Hinaman (51:22)
I love that. That was a very diplomatic and positive answer. Well done, sir. Last question for you, Michael. Leave us with your most optimistic, positive view of the future. I normally ask people, what’s it going to look like in 10 to 20 years? But I think you guys are on a faster time scale than that.

Michael Crabb (51:38)
Yeah, I mean, look, in 10 to 20 years, we need to get this industry to a place where it is an industry. It is a market. It is a set of bright, smart, young people finding new solutions and pushing me out to early retirement because I’m too curmudgeonly and I’m doing it the way we did it in 2025, right? We only get

by creating that learning environment and creating a marketplace that invites competitors and new ideas and different peers. And so, that’s where we need to head. If we head there, we can do it. This is not hard if we put our minds to it, but we need to allow that space to let that flourish.

Mark Hinaman (52:19)
I love that. Krabb, thanks so much for your time.

Michael Crabb (52:22)
Mark, thanks for having me.

‍