A Bill Gates-backed energy company is developing what could be a game-changing nuclear reactor

Bill Gates sees nuclear energy as a potential solution to lowering carbon dioxide emissions around the world, and he has spent the past decade funding new ways to produce the energy in a safe, affordable way.

About 10 years ago, Gates co-founded a company called TerraPower to build new kinds of nuclear reactors.

TerraPower is developing a line of reactors that use a molten chloride coolant, drawing on a decades-old but still unused invention to lower costs and reduce waste. The most common reactors use light (or regular) water as a coolant.

Following a US Department of Energy investment worth $40 million and a partnership with energy provider Southern Company, TerraPower plans on opening a new laboratory next year. Gates' company wants to develop a molten chloride prototype by 2030, and the laboratory will be used to test reactor materials in the meantime.

John Gilleland, the company's chief technical officer, told Business Insider that molten chloride designs are the "ultimate green reactor."

Nuclear energy grew in prominence after 20th-century scientists figured out how to harness the atom's power, but high costs and safety concerns over dangerous radioactive waste have deterred many countries from investing in it.

Scientists at Massachusetts Institute of Technology's Energy Initiative say that within the electricity sector, nuclear energy would be the least expensive solution to reducing greenhouse gas emissions in the next few decades. But nuclear energy currently accounts for only 11% of the world's electricity, according to the World Nuclear Association.

Nuclear energy is produced when radioactive fuel is put into a reactor to trigger fission — a process in which the nucleus of an atom splits within a reactor core.

TerraPower's liquid chloride design, however, puts uranium fuel and the coolant in the same molten salt, Gilleland said. Fission can heat the salts directly as the mixture flows through the reactor core, and the mixture then goes through heat exchangers to generate heat or electricity, he said.

A rendering of TerraPower's molten chloride nuclear reactor. BusinessInsider

Though TerraPower began working on its newest line of reactors just a few years ago, the design is based on Cold War-era molten salt technology. (TerraPower has also spent the past decade developing a traveling wave reactor, another advanced design.)

Researchers at the Oak Ridge National Laboratory in Tennessee developed a molten salt reactor in the 1960s, but funding came to a halt several years later as scientists raised concerns about corrosion and safety problems associated with the reactor.

Now, with government funding and the support of billionaires like Gates, these reactors have another shot at hitting the market. TerraPower and Southern Company are working on their design with scientists from Oak Ridge National Laboratory, Idaho National Laboratory, the Electric Power Research Institute, and Vanderbilt University.

Several other startups are competing with Gates' company to commercialize similar molten salt reactors.

In April, Florida-based company ThorCon received $400,000 from the US Department of Energy for a joint research project with Argonne National Laboratory. ThorCon aims to begin testing a molten salt-fueled fission reactor by 2023.

Department of Energy officials have also given $2.1 million to Alabama-based Flibe Energy, which is using thorium instead of uranium.

At the same time, some nuclear startups have struggled to make their designs commercially viable. MIT-affiliated Transatomic Power, for example, shut down in September after seven years of operation. The company, founded just after the 2011 nuclear disaster in Japan's Fukushima Prefecture, had claimed its reactors would produce electricity 75 times more efficiently than light water reactors.

In a blog post announcing the shutdown, Transatomic CEO Leslie Dewan acknowledged there had been errors in early analyses and said the company was unable to scale up fast enough. Transatomic Power later open-sourced its intellectual property for other researchers to use.

Microsoft co-founder and philanthropist Bill Gates talks with a colleague before the Berkshire Hathaway annual meeting in Omaha, Nebraska, U.S. on May 6, 2017. BusinessInsider

Renewable energy use is growing too slowly to prevent dangerous climate change on its own.

About 25% of the world's electricity currently comes from renewable energy sources, according to the World Energy Outlook. The International Energy Agency predicts that the share will rise to 40% by 2040, and nuclear energy can prove to be a vital factor in any changes.

For Southern Company and TerraPower, the companies' ambitious plan could produce a new reactor well before 2040. The partners are developing a prototype with the capacity to produce up to 1,100 megawatts of electricity — enough to power about 825,000 homes, according to the California Energy Commission.

A Bill Gates-backed energy company is developing what could be a game-changing nuclear reactor

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