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SAN FRANCISCO (Reuters) - TerraPower, a nuclear energy startup backed by Microsoft Chairman Bill Gates, has raised $35 million in a new round of funding to aid the development of a reactor fueled by nuclear waste.
Original investors Gates and Waltham, Massachusetts-based venture capital firm Charles River Ventures (CRV), and new investor Khosla Ventures participated in the latest Series B round, Izhar Armony, general partner with CRV said in an interview on Monday.
TerraPower is a nuclear spin-off project from Bellevue, Washington-based incubator Intellectual Ventures, which is run by former Microsoft chief technology officer Nathan Myhrvold.
"We have been an investor since it was just an invention, an idea," Armony said. "The company has had great progress and we felt it is time to put more wood behind the arrow, so to speak, to really allow them to accelerate development."
TerraPower is working to develop so-called traveling-wave reactors, which would use depleted uranium as fuel and have the potential to run up to 100 years without refueling.
Current nuclear reactors use enriched uranium, require frequent refueling and produce a lot of waste.
Concerns about global warming and efforts to reduce carbon emissions have sparked renewed interest in nuclear energy as a clean fuel, but the difficulty of disposing of spent uranium and fear of accidents have made the technology controversial.
Microsoft Chairman Gates has touted the TerraPower's promise in various public forums and told a conference in February that TerraPower was more reliable than wind or solar. He has also said the reactor would be safer than current nuclear plants as it burns most of the waste.
Armony, who has been involved with TerraPower since its inception, said company is still in the early stage of development with commercialization about a decade away.
"We are a few years away from actually burning uranium in reactors," he said. "This is still a very lab stage and simulation stage (company)."
Commercializing TerraPower and building a nuclear reactor would cost billions, but the company does not plan to go alone.
"We don't necessarily envision TerraPower to be in the business of building reactors itself," Armony said. "Reactors are very, very expensive. So TerraPower will go to market with partners."
The company will focus on supplying expertise to partners so that they can built the reactors, he added.
TerraPower has attracted the attention of other nuclear players, including Toshiba Corp, despite being very early in its research and development stage.
The Japanese microchip giant, which owns U.S. nuclear company Westinghouse, said in March had that it was in preliminary talks with the start-up to develop the reactors.
Armony declined to comment on the talks with Toshiba but said TerraPower is receiving a lot of interest from industry players.
"They are the focus of a lot of companies in the nuclear industry," he said. "The strategy is to partner with one or few major companies. This is not something one small company can do by itself."
Reporting by Poornima Gupta; Editing by Steve Orlofsky