Jay Wileman

President & Chief Executive Officer

GE Hitachi Nuclear Energy

August 9, 2021

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Ep 327: Jay Wileman - President & Chief Executive Officer, GE Hitachi Nuclear Energy
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Bret Kugelmass
We're here today on Titans of Nuclear with Jay Wileman, who is the President and CEO of GE Hitachi Nuclear Energy. Jay, welcome to the show.

Jay Wileman
Great. Thanks, Bret. Great to see ya.

Bret Kugelmass
Super excited to get the chance to interview you. I've interviewed your team before, been to all your facilities, absolutely one of your probably biggest fanboys out there in terms of technology deployment, also. Just super excited to be in touch directly and get to learn a little bit more about you.

Jay Wileman
Very good, well you've talked to some of the great team members with GE Hitachi. I don't know what else I'm going to be able to add, but let's find out.

Bret Kugelmass
Well, let's start off by just learning about you. Where'd you grow up?

Jay Wileman
Oh, that's a strange story. I actually grew up, through the end of middle school, in a suburb of Los Angeles. That summer going into high school, my mom and stepdad decided to move back to the state line of Mississippi and Alabama, a town of just a few dozen people and two broken caution lights. It was a strange way to come up, but it seemed to have worked out well for me.

Bret Kugelmass
Yeah, well, what was the impetus for the move? And how did it affect your educational upbringing?

Jay Wileman
The impetus was really getting back to the country, out of LA, right? Actually, it turned out great, going in high school there and learning a different culture for sure. It gave me an appreciation for culture that I've used throughout my career, in addition to the other stops with GE. But I was right there next to Mississippi State. I'm an alumni. Now I have to say College World Series champions, as of last week, so happy about that. Got an opportunity to get my degree there and also to go into University of Alabama at Birmingham for my MBA, so I became a Southern boy after that.

Bret Kugelmass
Great, great. And so your orientation is mostly on the business side of things?

Jay Wileman
Yeah, well, I actually grew up as a nuclear fuel engineer. I started co-oping at 18 years old with Southern Company, then Southern Company Services, Southern Nuclear. Throughout my college years, went back and forth for them in the nuclear fuel department and then went full-time when I graduated. Started off as an honest to goodness engineer, but it's been a while since I've done any real engineering.

Bret Kugelmass
Well, I wanted to tease that out of you. How long were you there? And can you just maybe tell us just a little bit about those early, early days? What is fuel engineering? What do you do?

Jay Wileman
Well, it's a lot of different things you can think about in nuclear. Maybe the way I stumbled into all of this anyway, was my high school senior year in my physics class. We were going through the physics book, I loved that, loved math. And I could tell that, based on the pace of getting through that book, we weren't gonna make it to that last chapter which was all about nuclear energy, so I made him skip ahead. That's Mr. Crawford, my senior teacher to give him just a quick shout-out. And by the way, I owe him this book back, so many, many years. And then I started to explore where to go to college, visited Mississippi State and spent some time thinking about the physics department proper, or the nuclear engineering department and talked to them and it just- putting the physics together with the engineering really did it for me. It just so happened in the co-op I ended up in the nuclear fuel department at Southern Company Services at that time. I got to learn all about really the economic, the customer utilization side of it first, and then trained with GE actually on their codes and methodologies when I went from that economic and commercial area over to the actual design area with Southern and trained with GE and absolutely fell in love with it. Then when I had an opportunity in 1994 to join GE, I jumped at it. I loved my time at Southern, but it's been a great, great trajectory for me with GE Nuclear.

Bret Kugelmass
Where did you start off on when you moved over to GE?

Jay Wileman
Right here in Wilmington. I've been- my GE career, I've moved to Wilmington three times. The first, as I said in '94, just starting off as a technical leader for a couple of customers, Fermi Monticello at that time, doing their reload engineering. I spent a couple of years doing that and then had an opportunity actually to get my first leadership job, which was leading the fuel department in Japan, for GE Nuclear. I moved from a single individual contributor to leading a team and working on a lot of the fuel engineering work for TEPCO and other customers.

Bret Kugelmass
What is the relationship between GE, Hitachi, the US, Japan? I see GE Hitachi in the name all the time. What does that mean? Are there a bunch of people from Hitachi that sit here and from GE that sit there? How does it work?

Jay Wileman
There's a little bit of that, but let's think about them as cousins or brothers and sisters or whatever, two entities. GE Hitachi is the organization I lead and it has 60% GE, 40% Hitachi. GE operates the joint venture and it's global for all things nuclear.

Bret Kugelmass
When you say 60/40, is that purely like equity ownership?

Jay Wileman
You can look at it like that.

Bret Kugelmass
Got it.

Jay Wileman
And then you've got the other side, which is Hitachi GE - we did a great job in naming things - that is really focused on the Japan market, and that's 80/20 with that equity sharing you talked about and it's operated by Hitachi in Japan. Now I say that - so it's a geographic split of the world - I say that, but then I always add on, except when we decide to do something different. We still serve a fuel across the world with our global nuclear fuel entity and we do services work in support of, along with Hitachi GE in Japan, and then we certainly leverage expertise as we go globally where it fits, so we make really, really strong natural partners.

Bret Kugelmass
And then how is the IP shared? Who owns the boiling water reactor design?

Jay Wileman
Well, as you can imagine, there's a long history there - 60 plus years - with GE starting the boiling water reactor at Vallecitos and a lot of those test reactors and with Dresden 1 with… in the day. And then, of course, we started partnering with both Hitachi and Toshiba back in the 60s and doing those joint developments, getting the boiling water reactor in Japan built with them based on our technology and advancing through the different stages, up to an including the advanced boiling water reactor, of which there are a number in Japan as well. We've had technical operation agreements with them for quite some time.

Bret Kugelmass
And then one more question on the arrangement and then I'll leave you alone, I promise. I'm very curious as to the decision-making hierarchy and what might require board-level approval for any given one of the entities. And does that mean that you have people sitting in Hitachi that actually kind of vote on board-level decisions here and vice versa? Is it sharing it at that level of organizational management as well?

Jay Wileman
I report to a board and it has three GE senior leaders and it has two Hitachi leaders and we work through our strategic plan and that gets approved and we move forward and execute on behalf of our customers to bring value to them in every part of the business.

Bret Kugelmass
I see. So it's not like the- I'm thinking like, let's say post-Fukushima or something, the Japanese sentiment might have changed. I guess I was always curious, does that have like a direct operational impact on the US entity or not?

Jay Wileman
Not in particular, I would say. Obviously, we had some services in Japan that were impacted. Obviously, HG&E certainly as well, but they've been busy supporting those customers for the relicensing and everything they need to do to get approval for start-up and then start up and obviously, once that happens, all the services as well. A lot of our GE Hitachi is focused on our customers here in the US, in Mexico, in Europe, and that, so that's been a majority of our focus, but we clearly spend a lot of time with our partners, HG&E, trying to bring value there as well.

Bret Kugelmass
Great, great. Okay, back to you. Sorry. Now, if you could continue through your career. You started off there on the technical side. How did you rise all the way to the top of your organization? What was that pathway?

Jay Wileman
It was not linear at all, probably even more so than a second derivative. But after I spent my time in Japan, I was fortunate enough to be able to be in the control room when Kashiwazaki 7 hit 100% power, and Kashiwazaki 1, 2, 3, 4, 5, 6, 7, all at 100% power, it's fantastic. But it was time for me to repatriate and I came back to an opportunity to run one of our manufacturing buildings doing the Zerk components, so all the tubing for boiling water reactor fuel, as well as the channels and other components. I went from being a nuclear engineer to leading 300 factory workers and PhDs that were doing all the material science and that. It was a very interesting change of years for me. And it used to be I could come in on a Monday morning and speak to my team, talk about SEC football and all that, and here in Wilmington, North Carolina that didn't go over so well as I would go out on the floor. I had to learn to appreciate NASCAR, so that's what I did, picked Gordon to be my hero, just to mess with all the Dale Earnhardt fans out there. It was a great experience for me, really doing something different than the pure engineering.

Jay Wileman
Tell me about those Zerk components for a second. What does GE actually do with them? Did they do- do they have a forging facility? Did they just do the machine- the post-processing machining? Do they wrap up the tube and weld it? What do they actually do?

Jay Wileman
I'll take you through that process real quick. In the Zerk shop, we take tube shell that we get through supplier, and we extrude it, so stretch it, if you will, through a-

Bret Kugelmass
So sorry, one quick second. It comes from a supplier already in two forms. It was extruded out- it was heated up to really high temperatures and then pushed out of an extruder to get into tube form, but you're saying it's not dimensionally what you need for your process, right?

Jay Wileman
We take that - and we've got, that's a GE specification that that's made to - we take that and put it through, again, the pilger mill to reduce it, right, and then obviously, it elongates. We cut it, and then we do heat treatment on it, then we put it through again. And we also have in-process heat treat, which is sort of the secret sauce for all the things that we've learned about material behaviors over the years. It's a learning curve that we've spent quite a bit of time on and we're not seeing any of those performance issues that we saw back in the 70s or 80s. Really high quality, put through a lot of processing to be the beautiful tubing that you see in a 10 by 10 GNF 3 is our current form there. We do that in the Zerk shop in our fuel manufacturing operations, which is under our NRC license. We'll bring in customers, UF6 in the cylinders, and we will go through a conversion process to make powder, treat the powder, we'll press it into pellets, and we'll center them and grind them, and then we'll load them into those very same tubes. We'll put the end plugs on each of them, and then get them ready to be assembled into that 10 by 10 matrix. That's what we do here in Wilmington.

Bret Kugelmass
And just in the interest of completeness, what are some of the other divisions and functions of GE Hitachi nuclear? We mentioned the Zerk shop, the fuel, getting it from the gas into pellet, loading it up, fabricating the whole assembly, that's another shop. I assume you guys have a services business as well, right? And that helps with outage and maintenance. And then is there another business that's responsible for R&D and design? Or is that wrapped up into the services business?

Jay Wileman
I think about it as five different value streams, bringing value to the customer. We talked about our Global Nuclear Fuel America's value stream. That's all of our shops that bring in everything needed to provide fabrication services for our customers, so that's one. The other is just the good old traditional parts. You have to have nuclear dedicated parts for certain areas. We have a parts business to supply that for our customers. We have what I would call a plant solutions business. Back in the day of EPU, Extended Power Uprate, or NobleChem, right, or any of those analyses for extended operation, Mela Plus or things along those lines where you can give the customers value and flexibility in their operations. That's the third real value stream there. And then we also have our new plants, advanced nuclear. That's- I'm sure we'll get around to talking about the-

Bret Kugelmass
It's my favorite part.

Jay Wileman
-and nature of it as well. I think that if you think about how you bring the different pieces there- and as you mentioned, the Field Services businesses is the fifth one - and that's everything we do out in the field for a customer, whether it's an outage where we're helping disassemble and reassemble, whether it's inspection services, in either the AI, whether it's a mods where they need some kind of a repair, or to support an upgrade, and even these days, decommissioning services, as well. As we know, obviously, the reactor internals and the NSSS system, we feel we bring a lot of value in helping plan out a very efficient decommissioning plan for our customers.

Bret Kugelmass
And then, and you sit over all of these value streams, essentially?

Jay Wileman
Yes.

Bret Kugelmass
But you started off kind of running individual divisions. We were talking a little about the Zerk factory. What are some of the other ones that you were placed as General Manager or CEO of?

Jay Wileman
After I came back to Wilmington and ran the workshop, that was around the time of the formation of our Global Nuclear Fuel joint venture. I was busy working on the implementation, implementation leader for that. Everything from the logo design to our first strategic plan, right, and that was really fun watching that come together with - at that time, again - Hitachi and Toshiba for our fuel business, so here in Wilmington, plus in Kurihama where we have the factory that's GNFJ for Japan. I spent some time doing that. And then I spent a couple of years out in San Jose, California, leading that Plant Solutions Businesses as it's known now, Extended Power Uprate, NobleChem, our BWR owner's group, our consulting piece, I had all of that. And I really enjoyed learning that part of the business. That was my first really big P&L business leadership role.

Bret Kugelmass
Then, sorry, how does GE make a determination? I mean, they've got tens of thousands of employees to choose from? How do they pick you? How do they pick you to give you that responsibility? Is there a specific internal training program? Or is it just someone spots you and says, Hey, this guy's a rising star. How do you get chosen?

Jay Wileman
I think, in GE, it's no different really in nuclear than elsewhere, but I think it is, you look at- it's a meritocracy. The ability to deliver, not just deliver, but deliver in the right way, with the customer in mind, with the GE values in mind, and all of that. I had a couple of opportunities where I went outside of what I was expected to do, and did a little bit more in a different way. Some of my sponsors took a chance on me, gave me an opportunity, and I was able to grow and grow and grow.

Bret Kugelmass
What is that word sponsor? What does that mean?

Jay Wileman
That's an executive more senior than you that has mentored you and gives you the opportunity to be visible, to be known, and to have opportunities to do something, again, outside of what your day to day thing is, so you get those experiences, and you can build on those. I view my career really as a set of experiences that I've learned a whole lot more than just one thing in every experience, right? And you put those together, and you figure out in a different environment how those work.

Bret Kugelmass
Tell us about some of your next steps as well.

Jay Wileman
Yeah. Here's where it gets non-linear. I was in San Jose, California, our headquarters at that time, running that P&L business and get a call from our HR team. And they asked me to go to Florence, Italy to run our Oil and Gas Global Services business. How would you take a nuclear engineer and put them into an oil and gas business? Well, I had sort of come up through, and in running that services business demonstrated the ability to work in that world. Then take it into oil and gas you think, Well, what does nuclear have to do with oil and gas? Actually, quite a bit. The same sort of value streams were there. These were- nuclear customers are oil and gas customers. They're highly capital intensive, right? Services matter. There are opportunities for the upgrades as long as- as well as the traditional maintenance as well. I got to spend four years in Florence, Italy - actually, I was- my wife was there for four years. I was in Nigeria, China, Brazil a lot of fun.

Bret Kugelmass
Help me understand that a little bit. How come the oil and gas business based out of Italy has fingers into such a wide array of markets? I could understand maybe Northern Africa, it's pretty close by. How come Brazil and all these other places, Sub Saharan Africa, how come all these other places?

Jay Wileman
Great thing, it's no different for oil and gas and it is the rest of GE. When you have great technology, it plays in many markets.

Bret Kugelmass
What was the technology, exactly? If it's a services business, is it just special flanges or what's happening?

Jay Wileman
For the new units, the technology it was everywhere from the big compressors that we put our GE turbines on to do a liquefied natural gas station. It's everything about the aero derivative turbines and the pumps that are needed for pipelines. It's about pipeline inspection technology. It was a lot that was brought together. The new units guy would work on expanding those markets, and then I had the opportunity to serve in the turbomachinery area with again, those traditional value streams,

Bret Kugelmass
Great. Okay, cool. Take us back to your to the next zigzag in your path.

Jay Wileman
So I zag then, after four years into our railcar leasing business in Chicago, Illinois. Again, you might ask why. In those days, and this is back in 2006 or 2007, we were really looking to take what's essentially a capital business and put a service component into it. Not just leasing the rail cars, but actually maintaining them, parts, all that. Having everything from the satellite tracking, where is it, is the door open, is it in a geo fence, all of that in those days. Again, I leveraged my experiences as a services person to be able to bring that in at that time. That was a- it was a really fun experience and I learned a lot there, because I went from engineering to the service business to learning asset management and underwriting. And I remember one of the first times my team did a lunch and learn with me and they were going to really impress me with the risk management and they brought out a Monte Carlo tool, not knowing that I might know just a little.

Bret Kugelmass
A little bit about Monte Carlo coming from the nuclear industry. Yeah.

Jay Wileman
But that was great. And then we went to move that business off to another owner, and again, sit at my desk, I get an opportunity to have a call with the HR leader, and I was asked to start up GE's mining vertical.

Bret Kugelmass
At this point, you say you get a call from HR. But what does that really mean? I mean, at this point, you're in some binder of executives who are just kind of consistently doing a good job, and that other executives kind of keep track of, and then they flip through and they need a new person say, This guy's got this, and this. I think, what actually is happening that leads to that call from HR.

Jay Wileman
I've got my binder for my team, as well. And I review it. I spend 25, 30%, on just thinking about talent development, how can I get this leader a new experience, increase exposure, scope, new exposure, all of that. That's what a GE executive is expected to do. Normally I say I get a call from HR. Well, that happens, but obviously my leader at that time came in and spoke to me as well. But that's sort of the process that we really have for talent development.

Bret Kugelmass
In terms of talent development - just because rarely I guess, do I get to ask someone in your position, who's been able to be the leader in so many different departments, worked his way up so well - how do you compare GE then to other companies? And is there a learning process, like a management learning process as to how to develop executive talent? Are there lessons learned? Do you go to conferences with even some of your competitors to kind of share - or maybe not competitors, maybe just other big industrial companies to kind of share best practices? How does the continual learning and development process happen within respect to this particular function?

Jay Wileman
I would say, and I won't claim that GE has that market corner. There are a lot of great companies out there that really value the talent development. Everything from our Learning Center in Crotonville, it's very well known for executive development courses and experiences like that that lets you cross integrate with a lot of different people, to be able to sit down in a learning, highly interactive session with somebody from aviation, or healthcare, or another part of the GE business where you're like, well, how does that fit together? Well, it actually does. There are a lot of common themes there on how to be a leader and how to continue to focus on your customers and deliver on technology and services in the full lifecycle. It's a good system, and I know that our HR team does benchmark a lot and keeps thinking about how to keep this fresh, if you will, and relevant and timely. These things change, obviously, over time.

Bret Kugelmass
And then is it- does GE have a habit - and this might be an obvious question to you, but as an outsider, I have no idea - does GE have a habit of promoting from within? And how does that compare to other major industrial companies?

Jay Wileman
You know, I would say, in the past, it was probably more tilted toward within. But I think as GE is now evolving, and you'll see that with what our CEO Larry Culp is doing bringing in external experts that bring something to the team is important as well. As I build my team, I like to have the experienced nuclear team, continue to give them more and more responsibility and leadership. I like to have a portion of being from elsewhere in GE, that can bring the GE values in, but into a different industrial space in nuclear and help us so we don't get that group thing. And then there's a section that just comes from outside of GE, right, whether it is nuclear, or whether it's not nuclear, and be able to keep the fresh ideas and the diversity of thought. Diversity is really, really key, in the traditional sense, but the way of thinking and experiences and all that. That's how I think you have a vibrant team.

Bret Kugelmass
Awesome. Take us back to mining. This is a little bit different. Instead of taking over an existing business line, now you're building one from scratch. Was that what you're saying?

Jay Wileman
Yeah, pretty much. We had, in our transportation business at that time, we had some technology for some of the big trucks you'd see, the wheel motors, if you will. We had some relationships, and we had a little piece over and some of our controls business on our water business, but none of them were talking to each other, we didn't really have the scale to get up into the C-suite. I took- actually, it was a report out from one of the Crotonville classes. It says here's the kind of vertical way ought to be and that was sort of the job description. The funny thing was, after saying yes, I thought about it, I called back and said well, where is this job based? The answer is, well, anywhere but the US. I really did QFD and did all the pluses and minuses of all the big mining areas and I found myself in Melbourne, Australia.

Bret Kugelmass
Yeah, big mining town. No nuclear though, but at least uranium mines.

Jay Wileman
Uranium, though, I've been to the uranium mines there, absolutely. In the iron mines and the coal and all that. Again, it was interesting because you stood up a team, you had to understand the customer dynamics, what they valued, and again, a mining company is very familiar to me. Capital intensive, technology, needs the service, right? That thread has gone through a lot of my different experiences across my GE career.

Bret Kugelmass
Yeah, pretty amazing. Okay, and then now we get back to the fun stuff. So now you're coming back to nuclear after the mining business. Is that right?

Jay Wileman
Nope. One more stop.

Bret Kugelmass
One more stop. Okay.

Jay Wileman
Actually, after a few years of that, we were really focusing on continuing the globalization push and one of the areas that we just see - and still see - is Sub Saharan Africa. I was asked to lead all of GE Energy - so the oil and gas, the power generation T&D type stuff - for Sub Saharan Africa and really getting that going, so I find myself for three years in Cape Town, South Africa. It was fascinating. Again, there was a- you look at a whole lot, you've still got your oil and gas customers. You've got your power generation there as well. Obviously not the grid and scale that we've got. It was a very different mix of items, and then still had keen interest in mining as well. Had that. There's obviously a lot of- Johannesburg was going to be one of the places I could have been instead of Melbourne. But yeah, I got to spend three years there and it was just fascinating learning about how to open up a market and continue to grow myself. I hit most of those African countries, not all of them.

Bret Kugelmass
Amazing. And then is it- when you say open up a market, is it - since GE has so many technologies to bring to the table - is it a matter of matching the market and the technology? Or the service? Or is it, Hey, this market is ripe for installing new assets, like new generation assets?

Jay Wileman
It's really looking at who's your customer? How do they succeed? And then how do you help them succeed? Whether it's a power generation company in Nigeria, that just doesn't have the capacity or the availability - there's always outage issues or something like that - how can we bring the full power of GE to be able to bring the right technology, then bring the service element to get the reliability there as well. It's interesting, very interesting.

Bret Kugelmass
Okay, so now you come back to nuclear.

Jay Wileman
Now, I come back to nuclear.

Bret Kugelmass
I'm gonna ask you, I'm gonna ask you the hard question. Why? I mean, I know you started off as a nuclear engineer, but you've obviously proven yourself now across a whole bunch of different business units within GE. Nuclear has always had a bit of a reputation of being slow and stuck here and there. There are other cool GE units, GE robotics, GE- you could have gone anywhere, why back to nuclear?

Jay Wileman
That's what I am at my heart is really a nuclear engineer. I love the industry, love the customers, love the technology, love what it does for the environment. And it was just, it was the right time. I had my family in all the places we just talked about, and I knew Wilmington very well. I came back into a role at that time that was the new plants role. And that's the only area that I hadn't participated in throughout my nuclear career. I came back as that plus the Chief Operating Officer, so a little bit of a succession planning, if you will, and spent, let's see, three, I guess three years in that role. And then it's a- this fall will be about six years in the CEO role.

Bret Kugelmass
Amazing. What is new build? What does new build meant to GE? When you first came there, what was on the table for new builds? And how has that changed over the years?

Jay Wileman
At that time, the big celebration in 1996 was selling the Longmen plant type power in Taiwan and that went through - as I'm sure you know, if you have any the history there - a long duration, starts, stops and that, so that was really the focus of new build. Obviously, in the mid-2000s, we had the Renaissance and we're bringing, not just the ABWR at that time, but, but also the ESBWR. And again, there was still a new build that we were working on with our partners in Japan, as well, throughout the 90s and 2000s. And then after the Renaissance, we started working for the ESBWR. We got our design certification document. Both DTE and Dominion got the combined operating license for the ESBWR, so it was really morphed into that. And then in 2015, 2016, when the projects here domestically were running into some issues, my team went off with some Red Bull and pizza on their own time at night and you spoke to a couple of them with the concept of the BWRX-300 and all its innovation that really hits at listening to the customer, what's it going to take to get back into new builds base. It was very clear certainty of cost and schedule, obviously, later, but- and not just certainty, but also, you can't look at a $10 billion plant and what it would do to a customer's balance sheet. You're really betting the company on a project, right? That's tough. So that's why we sort of targeted, Hey, we've got to get at or below a billion dollars to make this- and prove it and demonstrate it right. The team has done great. It really is the best of the best approaches. It builds on the ESBWR, which was, again, add a lot of the passive safety areas there, but yet it does new things, but in a way where we've already proven that technology, whether it's natural circulation, or all the components in the internals, and the Triple S system, but yet, it brings in a couple of phenomenal innovations. One is our integral isolation valve - and I'm sure … walked you through all the details of that, so he will do a much better job than I could do here - but that's key to really- they call it SMR, small modular reactor. I don't necessarily think of that s as small. This is simple. That's the key to keeping the great safety that we've had, but getting that cost down. That integral isolation valve allowing you to eliminate - or just not even eliminate, not need - a lot of the equipment, and just doing the design to cost instead of design to something else right is really, really key for us. The other breakthrough is our advanced construction technology. You may have seen just today, the DOE with NREC has awarded a consortium of us led by GE Hitachi to go and work on that advanced construction technology. I'm excited about that. Everything that we've done over the years, different than other SMRs, has already been proven. We don't have to come up that curve of construction. We've proven it with short durations, 38 months to 48 months over in Japan. We don't have to talk about how we're going to get from- my goodness, the US fleet was what, 60% capacity factor way back when, and now we're running at 93 plus. That's an experience curve. We start off that way, as compared to other designs, which will need to come up that curve as well. Same for the fuel. We're using GNF 2 for the BWRX-300, already license proven, and it's been our experience, it takes 10 years to license a fuel design, so we're there already.

Bret Kugelmass
Let me ask a tricky question, because I mean, listen, the X-300 I think it's my favorite design out there, because it doesn't do that many new things. That's my- listen, I love the advanced reactors, the newer technology, I love those too. But I do think that you got to kind of prove that you can build 10 plants first without incorporating something too new, just to kind of get the mechanics of construction, get the confidence of investors, and so that's one of the reasons I love the X-300 design so much, just because of how little it changes about the power plant. But was there ever the conversation - and then I'll ask this specific question as well - do you have access to the original financial documents for the first 50 BWRs that you guys built out? The literal construction documents, design documents, economic documents? Do you have access to that? That does still outperform the projected economics of the X-300, and so was there ever that conversation? Why don't we just build literally a 1960s reactor with just modern parts? Obviously, you can use the new fuel. Obviously, you can use the new valves. Obviously, you can use the new materials, but literally, like the size of equipment, the layout of the pipes, the construction of the building, just do what we did in the 60s, where it's just so obvious that the economic performance was so good, but was there ever that conversation?

Jay Wileman
Look, back in the 60s and 70s - and yes, I've spent, as you can imagine a lot of time thinking about lessons learned through the cycles of nuclear. And if you think about the 60s and 70s, those projects, they went over budget over time as well. But I'll tell you, in the 60s and 70s, that ideally, yeah, you'd like to just build one build another exactly like it another exactly like it. It's not what our customers wanted. That's not what our engineers were sort of forced to do, if you will, so every design was somewhat different.

Bret Kugelmass
But you can find first-of-a-kind designs from the 1960s that were like 500, 600 megawatt reactors, and in today's dollars only cost $500 million. And I understand maybe the regulations have changed, but then why not just go to another market that desperately needs power, where you can make the case, Hey, this is good enough for the US in the 1960s, there are a few upgrades over time that made it good enough for us today. This is what we want to sell you. Any thought to that?

Jay Wileman
I think you'll still get that the desire for the newest technology- and you made a point I want to expand upon, the regulations in the 60s, were obviously very, very different than what they are today post-TMI. That really was a lot of costs there. And as we've evolved, and of course, delivering the nuclear promise in the mid-2010s focused on trying to get that cost back. The customers did a great job there, but I think that I get your concept, but it's just, I think that the market is really not there. That's-

Bret Kugelmass
Would you guys be open to license - if somebody else wanted to pioneer that market, wanted to pioneer that business model, would you guys be open to licensing them your 1960s technology for just some royalty?

Jay Wileman
If you think about what's out there to do what you're talking about, proven that it's been built, operated, and all of that, that's our Advanced Boiling Water Reactor. It absolutely is.

Bret Kugelmass
I mean, I would buy a BWR, not an ABWR, I would buy a BWR. If I could, I would license that technology from you guys and just pay you a no-risk royalty, and just take your 1960s B - not A - the BWR to market.

Jay Wileman
And I will tell you that, again, depending on the regulatory framework you were in and all that, you wouldn't build it economically would be my gut call there. You could take that and you'd have to do so many changes that would almost be again, a first of the kind to me,

Bret Kugelmass
my thought would be, instead of pay for those changes, which can be hundreds of millions of dollars, pay to rewrite the regulations back to what they were in the 1960s.

Jay Wileman
Right. And we've learned so much more obviously, since the 60s, on just system reliability. All the different regulations were there for a reason, both design plus operations as well.

Bret Kugelmass
What I really mean is those plants, as they are today, they've incorporated changes and everything. I know that you can't go through the US NRC and build one of those plants today, but you could go through another regulator, like Vietnam or something. They want to build nuclear, they've got tons of coal, like they nuclear technology. I would want to bring a 1960s BWR with all the upgrades and learning since, but for the $500 million dollar price tag for 500, 600 megawatts.

Jay Wileman
Yeah. And I think, take the NRC aside for a second, right, but they are looked to as the global premier leader in the regulatory licensing area, but there's the AIA that countries have to come through, if it's like a Vietnam or some other country that's new to nuclear, so those are robust regulations as well. I love your thought process, existential argument there. I just think that the industry has moved on. Now, what I will say - and you mentioned advanced reactors, as well, Gen IV - I view the arc of the development of the nuclear industry, as parallel channels, each operating at its own pace. The base there is exactly that. The plants that were built in the 70s and 80s, we've got to keep them operating there online. I'll speak to US, but it's true globally. That's where we bring in values with the upgrades, or anything else, just subsequent license renewal, all those things that keep that in, because if those come offline, your whole carbon argument goes back, you step backwards by a decade or two. That's the first channel is everything that we're working on to keep those operating safely and efficiently and economically. I view the next layer, especially if you think about getting the net-zero by 2050, much less zero in power gen in 2035, as people are speaking to now. If you have those aspirations, you need to get started now with the new build wave. Again, the BWRX-300, with its history and its legacy, I believe is the only one that can meet that timeline.

Bret Kugelmass
Tell me about that, because last time I spoke to your team, it's been a couple years, so we're due for an update. Where's the X-300 right now in terms of the development timeline, and when can we see electrons on the grid from the first unit and where's it going to be?

Jay Wileman
As you may know, it's been announced as part of the plan in Canada for small modular reactors. OPG is going out and looking at three different. We are one of those and we are busy working to support them and in the evaluation, that we are working toward a plan that gets - we're working on now - that gets us on the grid with electrons from the BWRX-300 in 2028. Okay, so that's what we're working with. We're also talking with other areas, whether it's Poland and Synthos Green Energy, as you may have seen press releases, right, or Estonia or Czech Republic. Certainly Japan, obviously, when they're ready for for that. So it's in a number, but I think the leading one right now, I'm very impressed with what the Canadian government has done to put this roadmap in place and really understanding the need for that. Now, again, that's the X-300 small modular, to make sure you can have a chance at hitting that 2035 to 2050, and then the advanced reactors.

Bret Kugelmass
Before we get to the advanced reactors, let's just let's stick on the X-300 just for another quick second. You mentioned Canada and Poland. Does that mean you'd be going through the Canadian nuclear licensing authority? Or would you be going through the US one and hoping to translate the license?

Jay Wileman
This is under the CNSC, so Canadian licensing, absolutely. It's in their country. They are the experts in the licensing there and the regulator, so absolutely.

Bret Kugelmass
And then, historically, nuclear licenses have cost like- I mean, even NuScale, the budgets over 500 million now for a relatively simple reactor design. What are the expected costs to get through to get a nuclear license in Canada or anywhere in the world, really?

Jay Wileman
Well, I don't want to speak to very specific numbers, but let me conceptually say that a lot of that work, because it's built on the DNA of the ESBWR, a lot of that safety case -well, all the safety case, obviously, because it has this DCT DCD - but we've gone and are learning now on those things that are different for the BWRX-300 design. We are generating licensing topic reports, and for example, that integral isolation valve, we submitted an LRT to the NRC. They reviewed it and approved it. That has sort of retired that risk of something that's different than the licensing basis. Same will happen with the advanced construction methodology and other areas that are needed, so that's it. That's our focus with the US. And we're working with several US customers, as well, should put them on the list. But we take that knowledge, and then we go and we demonstrate that we can meet the CNSC safety case requirements, because again, that's our focus.

Bret Kugelmass
Yeah, I guess I'm just, I'm constantly worried about the regulations just because I mean, like the ESBWR was built upon the ABWR, right?

Jay Wileman
To a large degree.

Bret Kugelmass
And that still cost a billion dollars in licensing fees. Is Canada willing to commit to a more streamlined license? Because to me the license costs as much as the facility. It blows the economics out. Unless we attack the licensing issue with the same almost like analytical mindset that we attack the engineering issues, I feel like the whole nuclear industry is just trapped. Is there- you guys have an internal strategy department that, just like you put 50 engineers on corrosion chemistry, you put 50 lawyers on? How do we get the cost of a license from a billion dollars down to $10 million?

Jay Wileman
I may not go to 10 million, but it certainly-

Bret Kugelmass
Why not? I mean, that's what they were licensed- once again, back in the 60s, less than 10 million was spent on licensing a plan.

Jay Wileman
Yep. I would say that, yes, we do have- they're regulatory experts, not lawyers, although some may be both - but yes, we do indeed have a team that really understands what those requirements are and how we can best do that. Again, remember that the US NRC and CNSC have a collaborative MOU as well, because, theoretically, you'd love to have one envelope that would allow you to engineer once and license many times, so you don't have different designs of different areas. That's the whole purview of Cordell, that's looking at regulatory harmonization. I think that's really key. Again, the other piece is simplicity. Simplicity drives a lot of cost out and that's not just in construction, that's in regulatory licensing as well.

Bret Kugelmass
You're saying the document is literally going to be a simpler document. It's gonna have less graphs on it, it's gonna have less text in it.

Jay Wileman
I would hope so. As an outcome, absolutely.

Bret Kugelmass
Okay, so 2028. I'm gonna hold you to it.

Jay Wileman
I'll check back in with you, I'm sure before then.

Bret Kugelmass
Yeah, absolutely. And then any word on- I mean, do you guys have an estimate for how much it'll cost? Who fronts the cost? Is there a turnkey model that you guys could deploy? Is any of that possible?

Jay Wileman
Yeah, we're working a consortium. It's a little bit of a change in how maybe GE historically has done this. We're bringing in some strong partners. You'll see today an announcement, for example, with Cameco for being able to deliver fuel domestically. You'll see some other agreements coming out. There are some great engineering construction firms in Canada. That's important to us. It's also important to get all of our engineers in Canada, as well, a lot of them, I won't say all of them, but I'm really building out- we've got a great facility just outside of Toronto - or actually in Toronto area - and we're gonna start putting a lot of our design engineers and project managers and sourcing.

Bret Kugelmass
With this consortium, does that mean that, as a group together, it maybe won't be public, but there will be an internal financial spreadsheet across these members that say, Hey, we know the plant is going to cost this amount of dollars. Now, let's go to the banks and get the money.

Jay Wileman
Yeah, again, it's a, should we win this? It will be an OPG project.

Bret Kugelmass
Okay, so it's up to OPG, essentially, to pay for the costs. And then you guys just license the technology?

Jay Wileman
Yeah. We're still working through a lot of those pieces in addition to the good old detailed P&ID type finds as well, but still a lot to be a lot to be developed there over the summer. Absolutely.

Bret Kugelmass
And is there any internal conversations or thought or maybe what's just your thought on like a turnkey model? To me? It seems like there's so many countries that desperately need nuclear, but they don't. Many of utilities aren't nuclear utilities, they're not going to, you know, get so involved. They just want like a just some electricity at the end of the day. And to me, it seems like it's the vendor, the technology vendors in the best position to essentially take the cost risks onto themselves, because they it's their technology, they're the ones in charge that destiny, is there any talk about it a turnkey business model.

Jay Wileman
So if you think about it, when you say turnkey, it's complete risk allocation.

Bret Kugelmass
I mean like, GE goes and issues a bond, and gets $1 billion in cash, and then deploys that, builds a facility, and then turns over the keys for $1.5 billion in cash or something like that.

Jay Wileman
You're talking more like an IPP type of operator and that's not actually my business model. I believe in the best athlete. I believe in really understanding the risks, and allocating the risk to the people that can best manage those risks. I'm not a construction company, not at all. I'm an OEM and Triple S designer, right? And I stick to my needs from that point of view, but I know I need a world class construction company to be able to take care of all that civil works and such. I'll go find that partner and we'll figure out how to come together on behalf of the customer who's very interested in owning and operating that plant, not just selling me electricity. And most people's model out there today is, hey, I want the best technology, I'm gonna own it, and I'm gonna operate.

Bret Kugelmass
Yeah, yeah. I think that that makes sense too, to have the utility be the owner operator at the end of the day, but I still am interested in exploring how we can get back to a turnkey model somehow, to make customers more willing to get involved. Maybe it's not GE that fronts the money, but maybe it's that construction company. I don't know. What's the largest construction company in - pick a country - the Czech Republic or something, maybe they'd be willing to do the turnkey part and then just partner with you guys directly for the technology expertise.

Jay Wileman
Very well could be in the future. I would say that once we demonstrate that you can have an end to end on budget, on schedule, or even better below budget and an early delivery of something of our BWRX technology that starts up and get your 90 plus percent capacity factor in the first cycle and meets all COE, so it's got minimal staffing that's required, the licensing risk has all been retired, then maybe you might be able to see an IPP type person of, Hey, give me a power purchase agreement and I'll build this for you and sell you electricity, Mr. Customer. It's possible. I think that again, there's the risk element that we've got to demonstrate here in this industry, to be able to bring certainty. And that's the other thing, not just simple, but the other thing I think of when I think of the BWRX-300 is the certainty that we can bring.

Bret Kugelmass
Okay, so you wanted to talk about other advanced technologies. I'd love to hear about them, but I also want you to compare them to the X-300 at scale. How did those economic pictures look for an advanced technology at units, let's say one through 10, compared to an X-300, at unit 100?

Jay Wileman
Yeah, so that's yet to be seen. However, that's part of the design parameters that we're working on. Obviously, last year, Terrapower received the ARDP award based on the Natrium technology, which I love, because it's the best athlete brought together from our PRISM technology and their traveling wave reactor and really bring the best of each of those. And in addition to that, bringing in the secondary molten salt loop, to be able to take a 345 steady state, and be able to use that stored energy to go up to 500 megawatts for over five hours. It's fascinating to be able to do that and it simplifies things. It takes the secondary side out of the licensed area. And again, those same simplification concepts, those same design to cost concepts are there. And then you get the benefit, obviously, of the Gen IV, right?

Bret Kugelmass
What is the benefit of a Gen IV? I still never really quite heard of a super compelling case as to where the economic performance gains actually are on the Gen IVs.

Jay Wileman
Well, and that is I think what a lot of these companies are working on right now. We've had some demonstration reactors that had non-water moderation cooling, but again, you have to prove it at scale. And I think that's the great thing about the advanced reactor demonstration program is the ability to do that. Again, with a fast reactor, you do open up the opportunities for the recycling of fuel. I'm one of those guys that, when I'm at a conference and somebody uses the word waste, No, no, no, it's not waste, it's slightly used.

Bret Kugelmass
But new fuel is so cheap. I mean, it's like maybe later in the future we could use this stuff. I'm all for keeping it for 100 years and letting future societies take care of it. Why not just dig stuff out of the ground? It's like, we already produce a million times less waste comparable to other energy sources.

Jay Wileman
You can always get better, you can always get better, right?

Bret Kugelmass
Don't we want to go the opposite way? Don't we want to sacrifice a little bit of our million times advantage for economic to gain 10% economic performance?

Jay Wileman
Well, it's all about economics, so that's right. That's the first hurdle you absolutely have to clear. You've got to prove that it competes. That's sort of what we set as our goal. I want to be so economical in nuclear space with a small modular reactor that I can compete with, not just solar and wind, but I can compete with a combined cycle gas turbine.

Bret Kugelmass
Well, I mean, listen, back to the 1960s. plants, those plants produce power. The LCOE was cheaper than today's gas plants, which is like the cheapest - in America - is like the cheapest thing you could imagine. Okay, so I guess we're saying the jury's still out on- the advanced technologies are good to pursue, good to understand. Obviously, we have to always keep developing technology, but the jury's still out on the economic performance.

Jay Wileman
I mean, yeah, that's the whole piece of the demonstration there is in our joint teams have absolutely that charter is this is what we're going to prove this is how we're going to do it.

Bret Kugelmass
What happens if we build you one of these advanced plants, and listen every first-of-a-kind is going to run into all sorts of issues. That's expected. That doesn't mean it's bad technology, it just means you're learning operational characteristics. We are gonna have to go back down to 60% capacity factor for new technology. It's just gonna happen as we figure out corrosion issues, operations issues, new vibration, whatever it is, we're gonna be back down to 60%. What happens after running that for five years and the economic performance just isn't there? Do we give up? How do we advance past that point?

Jay Wileman
Well, imagine if we would have just given up with the whole light water reactor built in the 60s and 70s when they were operating 60%. You just learn, you get smarter. The thing even - and I talked about this in the BWRX-300 space - all that experience and learning curve that we're bringing to table on day one. If you think about it, though, a lot of the EDR 2 that we brought into the PRISM technology, and all the work that Terrapower has done in testing that. That's a pretty good leg up on understanding what those technical issues are in the materials space, in systems performance space, in PRA space, whatever it may be. I feel pretty good that we're not going to be like we were in the very, very first generation of nuclear even with advanced gen. It's just, it's not going to be as quick as the opportunity for a small modular reactor like BWRX-300.

Bret Kugelmass
Yep. And then what happens if all this takes 20 years and the climate narrative - which I think it's the best, the best case that nuclear has to make their case to the public and to governments is the climate narrative - what happens in 10, 15, 20 years when it's like, we're not talking about climate more, because either we've lost the game, or we've won the game at that point?

Jay Wileman
Yeah, I like to be a positive person, but we just have to do this. If we truly believe in net-zero by 2050, as many countries or provinces or states or private companies have talked about, this just absolutely has to be. We have proven that we understand this technology in this industry, we've learned a lot. There's a lot of experience out there and I'm very optimistic that we'll be able to do our part. And it's not just going to be about power gen with non-emissions. It's got to be a lot of other things as well, but it's up to us to do our part in the nuclear industry supporting the broader power gen industry. Absolutely.

Bret Kugelmass
Awesome. Well, as we wrap up here, I want to give you the final word. You've been an awesome sport, kind of going through all these big tough questions, really appreciate it. Any last thoughts for our audience?

Jay Wileman
I think that, again - excuse me - everything that we've learned, we've aligned toward what we know we have to get done to hit those carbon goals on behalf of the environment. What we really need to be able to do is get that consensus built with the broader stakeholders out there. We have to earn that. And I think we can certainly do that in demonstrating this technology for small modulars in demonstrating. We don't talk enough about what the installed base today has done for us. It's 20% of our power generation, it's 55% of our zero carbon generation, right? Appreciating that and what that means to the environment and then building on that for this sort of next generation build out is going to be really, really key. And as I visit a lot of these sites, the communities are fully supportive. They understand that it means jobs, very good paying jobs. It means that they're really contributing to this environmental impact in a very good way, relative to carbon in the environment. I think getting that momentum going again is going to be key and I feel out there, whether it's Canada, the US, the UK, Europe, I just feel the momentum shifting. I'm looking forward to doing our part as GE Hitachi.

Bret Kugelmass
Jay Wileman. Thank you so much.

Jay Wileman
Thank you much, great to talk to you today.

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