Sustainability Through Nuclear Technology: Dow & X-Energy in Seadrift, Texas

In late 2022, U.S. industrial leader Dow Inc partnered with Rockville, Maryland-based advanced nuclear developer X-energy to demonstrate a high-temperature gas reactor (HTGR) for industrial decarbonization. Dow, with $57 billion in annual net sales, has a stated objective of carbon neutrality along its entire value chain by 2050. The Dow X-energy nuclear cogeneration project, at the Seadrift facility in Texas, is part of the U.S. Department of Energy (DOE)’s Advanced Reactor Demonstration Program, which seeks to de-risk advanced reactors through cost-shared partnerships with private industry. Having begun in 2021, ARDP plans to invest $1.23 billion in this project over seven years.

We are a first mover in advancing sustainability, and we are also doing it in a way that creates long-term value… The IRA in the U.S. has really advanced things. We are participant in the advanced reactor demonstration program with the DOE. We have a project in our Seadrift, TX facility to build the first small modular nuclear reactor with X-energy. That is on the basis of a high-temperature gas reactor, which produces both electricity and steam. For a big industrial process, we need as much steam as we do electricity. I can take that site essentially to net-zero with that investment. Will be a power system that will be in place for decades. -Dow CEO, Davos Jan 2024

Zero-Carbon Plastic

Dow’s vision is to eventually produce “zero-carbon plastic,” as the need for such solutions is growing. For example, after two years of research, Danish toymaker Lego recently determined that recycling plastic bottles into toy bricks would increase GHG emissions. As society starts to account for the embedded carbon content of various products, Dow aims to realize premium pricing by selling low-carbon plastic. Dow had a Scope 1 and Scope 2 GHG footprint of 31.5 million tonnes CO2e in 2022, from 104 manufacturing facilities across 31 countries.

Seadrift, Texas

Dow’s Seadrift is the company’s second largest facility in Texas, spanning 4,700 acres and employing more than 1,200 people in Calhoun County. Seadrift annually produces 1,816 tonnes of material for food packaging and preservation, footwear, wire and cable insulation, solar cell membranes, and packaging for medical and pharmaceutical products. Co-locating a nuclear cogeneration plant at this energy consumer facility allows for the efficient utilization of produced heat.

Proponents of the Seadrift project estimate that nuclear repowering will reduce annual GHG emissions by 440,000 tonnes CO2e, totaling 1.4% of Dow’s Scope 1 and 2 corporate emissions. The Seadrift site currently uses combined cycle gas steam turbines with 156 MWe capacity. Installed in 2000, this cogeneration asset is nearing scheduled retirement age by 2030, when it will be replaced with nuclear. Construction is planned to start in 2026.

X-energy’s Xe-100

The Xe-100 reactor can provide 80 megawatts of electric power (MWe) from 200 MW of thermal output (MWth), and is expected have a 60-year operational life. The Xe-100 also can deliver high-temperature steam of 565°C to serve a variety of industries including mining, chemical production, and petroleum refining. Four Xe-100 reactors will be deployed on a 26-acre footprint at Seadrift. Reliability is of paramount concern to Dow; the facility has not had an unplanned steam outage since 1987. While Seadrift needs only 100 MWe electricity plus 200 MWth heat, Dow is purchasing four reactors to accommodate for planned and unplanned maintenance, plus backup. In the future, Dow aims to both expand Seadrift operations and sell excess carbon-free power to the grid. In September 2023, the Public Utility Commission of Texas established the Texas Advanced Nuclear Reactor Working Group to study advances in this technology, the supply chain development, and the changes needed the electric grid operator.

Project Management

One of the reasons that the DOE supports us is where we are trying to help mitigate the risk and trying to show how we can deliver these units at a repeatable cost that’s affordable for an investor. So you need an industrial company that has good project management capabilities like ours that can deliver a mega-project at a low cost. You hear a lot about big nuclear projects and cost overruns. I’m not in a business where I can pass all that costs down the chain to the consumer. I’ve got to be competitive.  What we are trying to do is work with X-Energy and DOE is to say: here’s our target for the cost of this energy, the cost of these capital projects. If we can execute on that, you will see other industrial players follow. At that point, you don’t need to subsidize every further investment that’s made. – Fitterling at Davos

Dow is an optimal industrial leader to pioneer U.S. nuclear cogeneration. The company is well regarded for its operational excellence in cogeneration. Energy accounts for a large part of the company’s costs, and Dow attracts and retains the expertise necessary to see complicated projects through. In November 2023, Dow embarked on building the world’s first Scope 1 and 2 net-zero ethylene and derivatives complex at Fort Saskatchewan, Alberta. The $6.5 billion Path2Zero investment project aims to use air separation and autothermal reforming to convert the site’s cracker off-gas to hydrogen and also capture and store 1 million tonnes of CO2 emissions.

References

Bloomberg. (2024, January 18). Dow CEO Jim Fitterling Speaks With Bloomberg in Davos https://www.bloomberg.com/news/videos/2024-01-18/dow-ceo-jim-fitterling-speaks-with-bloomberg-in-davos

Chopping, D. (2023, September 25). Lego’s Latest Effort to Avoid Oil-Based Plastic Hits Brick Wall. WSJ. https://www.wsj.com/business/retail/legos-latest-effort-to-avoid-oil-based-plastic-hits-brick-wall-8046af66

CNBC. (2023, May 12). Dow CEO Jim Fitterling on advanced nuclear reactor project in Texas. https://www.cnbc.com/video/2023/05/12/dow-ceo-jim-fitterling-on-advanced-nuclear-reactor-project-in-texas.html

DOE. Advanced Reactor Demonstration Program. https://www.energy.gov/ne/advanced-reactor-demonstration-program

Dow. Climate Protection. https://corporate.dow.com/en-us/science-and-sustainability/commits-to-reduce-emissions-and-waste/climate-protection.html

Dow. Seadrift Operations. https://corporate.dow.com/en-us/locations/seadrift.html

Dow. (2023). Greenhouse Gas (GHG) Protocol Disclosure Report 2022. https://corporate.dow.com/content/dam/corp/documents/about/066-00439-01-2022-ghg-disclosure.pdf

Dow. (2023, November 28). Dow’s Board of Directors Approves Final Investment Decision for Path2Zero Project. https://www.prnewswire.com/news-releases/dows-board-of-directors-approves-final-investment-decision-for-path2zero-project-301999044.html

Dow and X-energy. Advanced Nuclear Reactor Project in Seadrift, Texas. X-Energy. https://x-energy.com/seadrift

Fitterling, J. (2022, June 8). The Path to Zero-Carbon Plastic | The Real Leaders of Net Zero [Podcast]. https://www.blackrock.com/us/individual/podcasts/the-bid/zero-carbon-plastic

Glotfelty, J. (2023). Texas Advanced Nuclear Reactor Working Group PUC Project #55421. Public Utility Commission of Texas. https://www.puc.texas.gov/industry/nuclear/anwg_discussion_slides_for_sept_28_workshop.pdf

Johnson, B. (2023, August 18). First Small Modular Nuclear Reactor of Its Kind Unveiled for Calhoun County Dow Chemical Plant. The Texan. https://thetexan.news/issues/energy/first-small-modular-nuclear-reactor-of-its-kind-unveiled-for-calhoun-county-dow-chemical-plant/article_aa349e28-3dd7-11ee-b239-db5b613405e6.html

Milne, R. (2023, September 24). Lego ditches oil-free brick in sustainability setback. Financial Times. https://www.ft.com/content/6cad1883-f87a-471d-9688-c1a3c5a0b7dc

Sell, C. (2023, March 30). X-energy Presentation at Guggenheim Securities Conference. Investing in Advanced Nuclear Energy: Meeting Clean Energy Needs Across the Economy, New York, NY. https://www.guggenheimsecurities.com/about/news/media/investing-in-advanced-nuclear-energy-meeting-clean-energy-needs-across-the-economy

X-energy. (2021, March 1). X-energy signs Department of Energy’s Advanced Reactor Demonstration Program (ARDP) Cooperative Agreement. X-Energy. https://x-energy.com/media/news-releases/x-energy-signs-department-of-energys-advanced-reactor-demonstration-program-ardp-cooperative-agreement

X-energy. (2023, June 12). Xe-100—High-Temperature Gas Cooled Nuclear Reactors (HTGR). X-Energy. https://x-energy.com/reactors/xe-100

X-energy, & Ares Acquisition Corporation. (2023). X-energy Investor Presentation—June 2023. https://www.aresacquisitioncorporation.com/sites/default/files/2023-06/AAC_X-energy-Investor-Presentation-June-2023.pdf

Young, K. (2023, October 23). Integrating Clean Heat from Alternative Sources: Dow Presentation. DOE’s Virtual Industrial Heat Shot Summit, Virtual. https://www.energy.gov/eere/iedo/events/register-does-virtual-industrial-heat-shot-summit-oct-23-2023