As US Democrats brace for Donald Trump’s return to the White House, environmental permitting reform could provide some rare opportunities for bipartisan alignment.
Trump is preparing to launch a bonfire of environmental rules and laws. And while much of his deregulatory agenda is anathema to the left, some progressives have argued that an overly bureaucratic permitting system is slowing the buildout of renewable energy.
While that potential overhaul hangs in the balance, Microsoft is exploring using artificial intelligence to cut the time and money spent on efforts to win approval for new nuclear power plants. For today’s newsletter, I take a look at how that tool could support tech companies’ ambitions to enlist nuclear as a source of low-carbon energy for power-guzzling AI data centres.
Plus, we look at what’s behind a major reversal by retail group Walmart on the expensive diversity strategy it launched with fanfare just four years ago.
nuclear power
Using AI to deploy nuclear . . . to power more AI?
As Big Tech goes all in on an uncertain artificial intelligence revolution, companies are racing to access nuclear power to meet exploding electricity demand.
Microsoft, Amazon and Google have all struck deals this year with developers of atomic power, which they argue can provide the reliable 24-hour low-carbon energy to power their data centres — and keep their valuations soaring on the strength of their AI ambitions.
In September, Microsoft announced a deal to restart Pennsylvania’s Three Mile Island plant. But the supply of dormant US nuclear power plants is limited, and new buildout will require developers to go through a sluggish permitting process that has rarely been used in recent years.
If electricity-hungry AI is at the root of the energy demand problem, Microsoft is betting that it can also be part of the solution: it is developing an AI tool that it has said could help cut down the cost and time of completing nuclear site permits.
The effort will test bipartisan ambitions to improve an energy permitting process that critics say is mired in red tape — and could remove a key hurdle for the so-called Magnificent Seven.
“Licensing is the single biggest bottleneck for getting new [nuclear] projects online,” Microsoft AI director Nelli Babayan said in a presentation to a September workshop at the Nuclear Regulatory Commission, which is responsible for approving new nuclear sites.
Since few nuclear site permits have been issued over the past 15 years, data is spotty. But the costs of applying to the NRC have ranged from tens to hundreds of millions of dollars, according to a study by utilities LG&E and KU, and have involved lengthy delays. In its presentation, Microsoft cited a decade-long timeline to win site approval.
Dominion Energy, one of the biggest US utilities, spent as much as $600mn pursuing two licenses for a traditional large-scale power station in Virginia, according to the LG&E and KU study. (A Dominion spokesperson could not confirm that figure by publication time.)
These applications require “a huge amount of manual data collection”, Kirsty Gogan, founding director and co-CEO of Terra Praxis, told me. “You have to invest all that time and money, without really knowing if you’re going to be successful.”
NRC spokesperson David McIntyre said the agency had made strides in efficiency. He pointed to a new facility being developed by Kairos Power in Tennessee, the Hermes 2 test facility, whose construction permit was approved last week in a process that took under 18 months. Last month, Google announced a deal with California-based Kairos to build small modular nuclear reactors.
The Hermes 2 licence was approved “much quicker than previous reviews”, McIntyre said, “by leveraging our work on the first Kairos application and taking innovative approaches to some of our required actions”.
Microsoft has partnered with Terra Praxis to train AI models on nuclear regulatory and licensing documents, as well as geographical and seismic data, to streamline the process of preparing applications for regulatory review. Terra Praxis said the AI tool it has built with Microsoft can cut the time to produce early application drafts from years to hours or days.
McIntyre said the NRC was “actively exploring potential uses of AI, including possibly Microsoft’s, to improve the efficiency of agency processes”.
The first clients of the tool are likely to be utilities and power generation businesses, Gogan said. Terra Praxis is particularly interested in utilities that operate coal plants that could be repurposed for nuclear power generation.
A 2022 report by the US Department of Energy said hundreds of US coal power stations, including retired and active plants, could be converted to nuclear energy. Repurposing coal equipment for nuclear power could save 15 to 35 per cent in construction costs, it said.
Advocates for nuclear energy say such fleet-scale undertakings — involving dozens of sites at once, rather than just a slow drip of individual projects — will be needed to bring down costs. That is due to the high level of investment needed to support the nuclear supply chain and train a workforce that can deliver plants on schedule.
The director of a newly formed nuclear energy venture, who met this year with the NRC to argue for licensing reform, said the agency had been receptive to the push for permitting reform.
But for now, he added, “what I think most people see is a ball of red tape, timelines that are horrendous, and supply chains that have been chopped up and distributed all over the world, that are now at risk for geopolitical reasons. If there’s ever going to be any commercial adoption [of nuclear power], that’s what has to be navigated.”
Diversity, Equity and inclusion
Walmart drops DEI commitments
Walmart has announced a large-scale retreat from key diversity, equity and inclusion policies, becoming the biggest US company so far to drop commitments to DEI programmes following activist pressure.
Ahead of the Black Friday shopping rush, the US’s largest private-sector employer said it would wind down its Center for Racial Equity, a non-profit it launched in 2020, as well as programmes that help suppliers that are majority-owned by women, minorities, veterans, or LGBTQ people.
Walmart will stop sharing data on its LGBTQ corporate policies with the Human Rights Campaign, and will phase out the term diversity, equity and inclusion in company documents, the retailer said.
Walmart declined to explain the moves, or to clarify whether it planned to discontinue racial equity training entirely.
“We’ve been on a journey and know we aren’t perfect, but every decision comes from a place of wanting to foster a sense of belonging,” the retailer said in a statement.
The term DEI has become a target of rightwing attacks. “Anti-woke” activist Robby Starbuck claimed credit for Walmart’s U-turn, writing on X: “I have to give their executives major credit because this will send shockwaves throughout corporate America.”
A growing number of companies including Ford, Caterpillar and Boeing have dropped or watered down their diversity policies, as we highlighted a couple of months ago.
However, it’s not clear that investors consider diversity efforts to be a financially material concern. Walmart’s stock price did not react to Monday’s news. But a steep drop in sales of Bud Light, after a collaboration with a transgender TikTok personality, highlighted the potential risks for companies drawn into the US culture wars. The backlash drove a 10.5 per cent fall in revenue at parent company Anheuser-Busch InBev.
Smart reads
Falling short The COP29 outcome is too little, too late, warns Martin Wolf.
Overpromising The general public has some sound reasons to be sceptical about politicians’ promises of green employment booms, writes Sarah O’Connor.
Holding fire Steelmaker ArcelorMittal has blamed policy uncertainty for its decision to delay green investments in the EU.
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