@billtilles.bsky.social
Great point. Electricity is simply a commodity product. And in commodity businesses there is only one economic imperative: low price always wins. Nuclear generates this commodity at the highest possible price compared to alternatives. See the problem?
November 29, 2025 at 12:14 PM
Great point. Electricity is simply a commodity product. And in commodity businesses there is only one economic imperative: low price always wins. Nuclear generates this commodity at the highest possible price compared to alternatives. See the problem?
First we already have regulation of public utilities. But monopoly utilities now have to build new expensive stuff and raise customer prices which stinks. The alternative is to make data centers financially responsible for all their power needs.
November 26, 2025 at 8:20 PM
First we already have regulation of public utilities. But monopoly utilities now have to build new expensive stuff and raise customer prices which stinks. The alternative is to make data centers financially responsible for all their power needs.
If’s actually quite simple. AI data centers are buying up all the cheap, underutilized megawatts of electricity in the US. Then they demand monopoly utilities build even more generation. As a result, the utilities captive customers pay higher prices. And perhaps suffer declining reliability.
November 26, 2025 at 12:00 PM
If’s actually quite simple. AI data centers are buying up all the cheap, underutilized megawatts of electricity in the US. Then they demand monopoly utilities build even more generation. As a result, the utilities captive customers pay higher prices. And perhaps suffer declining reliability.
You’re half right. Nationalization would provide enormous savings in capital costs, the govt funds at a much lower rate than the private sector. But accountability is problematic because it often leads to low cost energy solutions which are the dirtiest, ie coal.
November 25, 2025 at 11:18 AM
You’re half right. Nationalization would provide enormous savings in capital costs, the govt funds at a much lower rate than the private sector. But accountability is problematic because it often leads to low cost energy solutions which are the dirtiest, ie coal.
It stands for a willing suspension of disbelief, everything they acquired got ridiculous valuation multiples, plus accounting fraud. Their financials were insanely vague. Plus they said they were a trading powerhouse with no eps volatility. Huh?
November 24, 2025 at 11:30 PM
It stands for a willing suspension of disbelief, everything they acquired got ridiculous valuation multiples, plus accounting fraud. Their financials were insanely vague. Plus they said they were a trading powerhouse with no eps volatility. Huh?
Interstate t.mission exposes momopoly utilities to price competition. Natural gas lines reinforce their base load monopoly position and provides the energy transition they always wanted, coal to gas.
November 22, 2025 at 11:53 AM
Interstate t.mission exposes momopoly utilities to price competition. Natural gas lines reinforce their base load monopoly position and provides the energy transition they always wanted, coal to gas.
Max Weber ftw.
November 22, 2025 at 11:14 AM
Max Weber ftw.
The right question is asking why IOUs need 50% equity layers while munis, co-ops, etc have zero equity in their capital structures. The real savings is in the balance sheet not the income statement (i.e lower ROEs).
November 21, 2025 at 9:47 PM
The right question is asking why IOUs need 50% equity layers while munis, co-ops, etc have zero equity in their capital structures. The real savings is in the balance sheet not the income statement (i.e lower ROEs).
Utilities outperforming tech kinda says it all.
November 21, 2025 at 8:20 PM
Utilities outperforming tech kinda says it all.
Excellent question. If you read the finance literature from that period, all the concerns are fears of excessive government interference. Our reality today is the exact opposite, full regulatory capture by corporate interests.
November 21, 2025 at 6:48 PM
Excellent question. If you read the finance literature from that period, all the concerns are fears of excessive government interference. Our reality today is the exact opposite, full regulatory capture by corporate interests.
“asskickers, shitkickers, and Methodists.” Blazing Saddles did it better.
November 21, 2025 at 5:18 PM
“asskickers, shitkickers, and Methodists.” Blazing Saddles did it better.
Which would you prefer on a risk adjusted basis?
November 21, 2025 at 12:47 PM
Which would you prefer on a risk adjusted basis?
That is not remotely the case here. Equity as a percent of capitalization is a social not an economic construct. Japanese utilities had 20% equity layers and carried AA+ bond ratings. The US IOUs had 45% equity layers and were rated BBB. These inflated layers raise costs.
November 19, 2025 at 10:51 PM
That is not remotely the case here. Equity as a percent of capitalization is a social not an economic construct. Japanese utilities had 20% equity layers and carried AA+ bond ratings. The US IOUs had 45% equity layers and were rated BBB. These inflated layers raise costs.
You could also make the case that utilities, which are risk free monopolies, should have less equity in their capital structures. This would also lower prices.
November 19, 2025 at 10:40 PM
You could also make the case that utilities, which are risk free monopolies, should have less equity in their capital structures. This would also lower prices.
Wow, that would be 7000 100 mw SMRs. Very impressive.
November 17, 2025 at 11:08 AM
Wow, that would be 7000 100 mw SMRs. Very impressive.
Well your kind of posting our origin story here. President Eisenhower wanted ”atoms for peace“, the navy had a surplus reactor, the Shippingsport, PA nuclear power plant was built, and here we are.
November 14, 2025 at 11:04 PM
Well your kind of posting our origin story here. President Eisenhower wanted ”atoms for peace“, the navy had a surplus reactor, the Shippingsport, PA nuclear power plant was built, and here we are.
The difference here is that this is a non investment grade credit with that yield so people are pricing in some risk. In 2007 the credit risks were wildly mispriced as solidly investment grade. In the “Big Short” the credit person who messes up is the blind woman.
November 14, 2025 at 7:30 PM
The difference here is that this is a non investment grade credit with that yield so people are pricing in some risk. In 2007 the credit risks were wildly mispriced as solidly investment grade. In the “Big Short” the credit person who messes up is the blind woman.
Your logic is correct. The eminent energy professor Vaclav Smil essentially and politely called the technology BS and I leave the last word to him.
November 14, 2025 at 12:07 PM
Your logic is correct. The eminent energy professor Vaclav Smil essentially and politely called the technology BS and I leave the last word to him.
You’re right. But electricity is a commodity and in commodity world low price always wins. SMRs produce electricity at the highest price. Hence they will likely remain a niche technology. Building many if these won’t/can’t change this.
November 14, 2025 at 12:04 PM
You’re right. But electricity is a commodity and in commodity world low price always wins. SMRs produce electricity at the highest price. Hence they will likely remain a niche technology. Building many if these won’t/can’t change this.
Aboxlutely right. Investor owned utilities have a higher cost of debt, (they pay a corporate rate) and the remaining 50% of their capital structure is equity, which is about 5-6% more expensive than that. Nice job.
November 14, 2025 at 2:03 AM
Aboxlutely right. Investor owned utilities have a higher cost of debt, (they pay a corporate rate) and the remaining 50% of their capital structure is equity, which is about 5-6% more expensive than that. Nice job.
There was an interesting study done years ago about nuclear concerns. All the scientists and policymakers were worried about proliferation. The general public was worried about nuclear plants going boom.
November 14, 2025 at 1:51 AM
There was an interesting study done years ago about nuclear concerns. All the scientists and policymakers were worried about proliferation. The general public was worried about nuclear plants going boom.
Weil, not really. I believe it was JP Morgan that recently issued a long research report on three already built SMRs, two in Russian and one in China. They cost three times their original budget and took twice as long to build. Just like Plant Vogtle in Georgia.
November 14, 2025 at 1:42 AM
Weil, not really. I believe it was JP Morgan that recently issued a long research report on three already built SMRs, two in Russian and one in China. They cost three times their original budget and took twice as long to build. Just like Plant Vogtle in Georgia.
Totally wrong. Smr’s are more expensive on a per kwh of electricity produced. Example: minivan seats 8, costs $40k, moves people at $5k per head. Used two-seater, costs $20k, moves people at $10k per head. Replace “per head” with kilowatts and you see the economics problem.
November 13, 2025 at 10:11 PM
Totally wrong. Smr’s are more expensive on a per kwh of electricity produced. Example: minivan seats 8, costs $40k, moves people at $5k per head. Used two-seater, costs $20k, moves people at $10k per head. Replace “per head” with kilowatts and you see the economics problem.