I watched this wonderful talk from Jim Kennedy this week. In the talk, Jim beautifully breaks down the surprising economic connections between the loss of control of the rare-earth mineral market, the decline in the manufacturing dominance of America, and the potential to develop thorium as a nuclear fuel source.

Kennedy posits that by controlling the relatively small ($3 billion) market on rare-earth mineral production, China has put a lock on the huge market of value-added goods ($4+ trillion). Basically, by controlling access to the rare-earth minerals which are absolutely essential for the production of electronics, China is putting immense economic pressure on manufacturers to produce their goods in China.

Kennedy presents a strong argument, and where it really gets fascinating is the connection of this industry to nuclear regulation. Essentially, it seems that one of the major issues that has forced rare-earth mining producers to shut-down production in America is due to their tendency to produce a particular mining by-product known as thorium. Wherever you find rare-earth minerals you also find thorium.

Thorium is a relatively common mineral in the earth’s crust; it is also radioactive. Although it should be noted that this radioactivity does not make thorium particularly dangerous, as its alpha radiation is not able to penetrate human skin. In fact, people have a long history with production and use of thorium in the glowing mantle used in gas lamps, and it is thought that generally these uses are safe.

Because of its reactivity, thorium also has the potential for use as a nuclear fuel. In particular, there is a lot of excitement around the development of a thorium fuel cycle in a next generation reactor known as a molten-salt reactor. This type of reactor provides numerous benefits over current generation nuclear, including dramatically lower waste production and much improved safety systems. I would highly recommend a watch of this short video for an introduction to the liquid-fluoride thorium reactor, a technology that has the potential to provide sustainable and safe base-load electrical power for the future.

Through developing a thorium fuel cycle, we could easily meet world demand for power for thousands of years. This technology is actually so promising that it seems unbelievable, maybe even downright magical. Here is the fact we have forgotten though, nuclear technology is magical. All that we have to do is bring the right concentrations of the right rocks together in the right space and they just start producing energy (like magic).  

If this fact alone doesn’t just blow your mind, then you have lost your wonderment for the world. But it doesn’t really matter. It is a fact that a massive amount of energy can and will be obtained from the radioactive decay of fissionable material. The connection to nuclear arms and a number of high-profile accidents over the years may have taken the shine off of nuclear energy, but none of that changes the fact that it is a reliable source of cheap plentiful power. We cannot wish away the existence of nuclear technology, because it would make the world simpler. 

Trying to wish away the existence of nuclear technology is exactly what killed rare-earth mining in America. Because thorium was a major by-product of rare-earth mining, and thorium was classified as a nuclear fuel, it presented huge regulatory hurdles. The last rare-earth mine in America was actually closed following a minor release of mineral thorium. This impediment to rare-earth production in America is known as the thorium problem.

In order to make rare earth mining in America profitable, there needs to a profitable use of thorium in order to offset the regulatory costs of dealing with it. Hence, the development of new nuclear technology and a thorium fuel cycle would potentially provide not only a huge source of sustainable power, but it would also solve a major problem for rare-earth mineral production, and could lead to a reinvigorated electronics production industry in North America. Through a modest investment in research and development of thorium based nuclear reactors, we can turn the thorium problem into the thorium solution. 

While it does not seem to be gaining any traction in America (beyond the internet), it would seem that the great potential benefit of thorium as a nuclear fuel has not gone unnoticed in China. China sees that by developing power from thorium, they may be able to produce cheap baseload power in a safe and sustainable way. More importantly, as Jim Kennedy warns, China is not going to share this technology but they will lease it globally for great profit.

The energy industry is an absolute giant, and the only one that is bigger than the electronics manufacturing sector that China already has a lock on. If China can develop next generation nuclear technology for 10 cents a kilowatt hour, even while dealing with the minuscule amount of waste produced by a thorium reactor, this has the potential to turn the world upside down.

If China develops a modular, mass-produced thorium nuclear technology, it will also gain the associated economic and political power and there will be no looking back.

People have developed an irrational fear of nuclear energy over recent decades, but I would not count on this being enough to stop people from buying it. Maybe I am wrong and we in the west will turn our noses up at any thought of new nuclear power, but I am sure this will not be the case in the most heavily populated parts of the world. The developing world is desperately thirsty for electricity, and they are going to buy it from whoever can offer it to them at a competitive price.

More than just offering a means to raise the developing world in a more sustainable way, thorium could offer us a sustainable means to tap into high power applications in the western world. Things like going to space cost a lot of energy. Do you want to go to space? Thorium, or something very much like it, is going to be needed if we want to provide the kind of power that would be necessary so we all can go to space one day.

If we want to dream big, we are going to need the power to do it.