AI’s Energy Crisis Is Fueling a Nuclear SMR Investment Boom

AI’s Energy Crisis Is Forcing a Nuclear Revival

The debate over humankind’s primary energy source has intensified in recent years. Historically, fossil fuels have dominated, and arguably still do when accounting for total energy consumption across heating, industrial processes, and transportation—not just electricity generation.

However, these discussions predated the AI boom, which has supercharged global energy demand. Neural networks, Large Language Models (LLMs), and AI operations are exponentially more energy-intensive than traditional computing. For example, a “search” performed through an LLM like ChatGPT consumes 10x-30x more energy than a standard Google search.

Depending on the adoption rate and data center buildout speed, data centers could see their energy requirements multiply by 2x-6x by 2030.

This surge creates a critical bottleneck. Data centers require a stable, high-quality power supply that is 100% reliable—something intermittent sources like solar and wind cannot yet provide at the necessary scale without massive storage infrastructure.

Meanwhile, relying on fossil fuels contradicts the tech industry’s carbon reduction commitments. This is why major AI companies are turning to nuclear energy, which offers the unique combination of large-scale baseload power, stable electrical frequency, and zero carbon emissions.

Early moves included Microsoft’s initiative in late 2024 to restart the Three Mile Island nuclear reactor. But to fulfill the massive future demand of AI data centers, restarting old plants isn’t enough—new reactors are required.

What Are Small Modular Reactors (SMRs)?

The challenge with traditional nuclear reactors is speed. Building a conventional plant is an extremely slow process. For example, the Vogtle reactor project in Georgia took more than a decade, ran over 7 years behind schedule, and cost double the original budget.

These delays stem from the complexity of bespoke mega-projects and a shifting regulatory landscape. To solve this, the nuclear industry is pivoting to a manufacturing-first approach: SMR, or Small Modular Reactors.

SMRs are smaller than conventional reactors and modular, meaning components are prefabricated in factories and transported to the site for assembly, similar to shipbuilding or aircraft manufacturing.

The Many Advantages Of SMRs

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Standardization

In traditional nuclear power, every plant is a custom mega-project, preventing standardization. SMRs promise to change this by using a repeatable design built in series.

Mass production brings economies of scale to nuclear for the first time. More importantly, it reduces regulatory friction. Instead of requiring bespoke testing and permitting for every site, a standardized SMR design can be approved once and deployed across hundreds of locations. The smaller size also allows SMRs to tap into industrial supply chains rather than relying solely on specialized nuclear vendors.

Safety

Nuclear energy’s popularity waned after high-profile failures at large centralized plants like Chernobyl and Fukushima. The immense energy density of a large reactor makes cooling difficult and failure catastrophic.

SMRs are inherently safer due to their smaller core size and modern passive safety systems, which often rely on gravity and natural convection for cooling rather than powered pumps.

Location

Because they are smaller and safer, SMRs require much smaller Emergency Planning Zones (EPZ) than traditional plants. This simplifies site selection and permitting.

Consequently, SMRs can often be deployed at former coal or gas power stations. This not only streamlines permitting but also allows projects to reuse existing grid infrastructure like transformers and transmission lines.

Scaled For Industry

A massive advantage of SMRs is scalability. While a large nuclear plant is too big to power anything but the grid, SMR modules can be matched to specific industrial loads.

For example, one or two SMR modules can provide the exact amount of power needed for a large AI data center, removing reliance on local grid capacity. This is critical because grid congestion is now the primary bottleneck for data center deployment.

In Texas, CenterPoint Energy reported a 700% increase in large load interconnection requests, growing from 1 GW to 8 GW between late 2023 and late 2024. Utilities like ComEd, PPL, and Oncor are reporting more GWs of data center applications than their historical maximum peak demand.

Camus Energy

North America SMR Boom

Until recently, most nuclear expansion occurred in Asia, with China and Russia leading construction. This is changing rapidly as SMR projects multiply across North America.

How to Invest in Nuclear Energy for the AI Boom

Cameco

One way for investors to gain exposure to the nuclear renaissance—driven by SMRs and new Gen IV designs—is through uranium. Cameco is one of the world’s largest uranium miners and the largest in a stable Western jurisdiction.

Years of underinvestment have led to a chronic uranium shortage that will be difficult to resolve quickly, supporting higher commodity prices.

Notably, fuel costs are a small fraction of a nuclear plant’s operating budget. Therefore, utilities are price-insensitive during shortages, creating an ideal environment for miners like Cameco.

In 2022, Cameco moved beyond mining by acquiring a majority stake in Westinghouse, the leading US nuclear builder, alongside Brookfield (BEP -1.84%). Westinghouse produces the proven AP1000 reactor and is developing the AP300 SMR and the e-Vinci microreactor.

(You can read more about Cameco in our dedicated report covering the company.)

Oklo

As AI companies scramble for power, many are partnering directly with SMR developers. For example, Google signed with Kairos for up to 500 MW of SMR capacity starting in 2030, while X-Energy plans to deploy 12 Xe-100 reactors in Washington State to service Amazon.

Others, like OpenAI founder Sam Altman, took a direct approach. Altman served as chairman of Oklo, guiding it to public markets via a SPAC. In early 2025, Altman stepped down to “avoid conflict of interest” and facilitate future partnerships, but Oklo remains firmly positioned as an “SMR for AI” company.

Oklo’s design differs from traditional reactors; it is a “fast reactor” capable of recycling nuclear waste. This potentially alleviates uranium supply constraints, as US waste stockpiles contain enough energy to power the country for 150 years.

Fast reactors also consume transuranic materials (heavier than uranium), reducing proliferation risks and shortening the radioactive lifespan of the final waste product.

Oklo expects to deploy its first 75 MW reactor at the Idaho National Laboratory (INL) by late 2027 or early 2028.

“We have been working with the Department of Energy and the Idaho National Laboratory since 2019 to bring this plant into existence, and this marks a new chapter of building. We are excited for this, and for many more to come.”

Jacob DeWitte – CEO and co-founder of Oklo

Recent deals, including a 1.2 GW project for Meta in Ohio and a massive 12 GW agreement with data center operator Switch, demonstrate that Oklo is expanding well beyond its OpenAI origins.