TLDR:
- Amazon announces plans to explore small modular reactor (SMR) deployment in Virginia and Washington
- Amazon invests in SMR company X-energy as part of a $500 million funding round
- Google backs construction of seven SMRs from Kairos Power
- Nuclear power stocks surge, with Oklo and NuScale Power up over 30%
- Tech giants increasingly invest in nuclear power for data center energy needs
Nuclear energy stocks experienced a significant boost on Wednesday as tech behemoths Amazon and Google announced major investments in small modular reactor (SMR) technology. The news sparked a rally in the sector, with some companies seeing their share prices jump by more than 30%.
Amazon revealed plans to collaborate with utilities in exploring the deployment of SMRs in Virginia and Washington state. The e-commerce giant also participated in a $500 million funding round for SMR company X-energy, alongside Citadel CEO Ken Griffin and private-equity firm Ares Management.
This announcement came just two days after Google declared its support for the construction of seven SMRs from startup Kairos Power, with delivery expected between 2030 and 2035.
The market responded enthusiastically to these developments. Shares of SMR companies Oklo and NuScale Power surged by over 30%. Oklo, backed by OpenAI CEO Sam Altman, and NuScale Power, while still far from large-scale power production, saw significant investor interest. Constellation Energy, which operates the largest fleet of nuclear plants in the U.S., also benefited from the news with a more than 3% increase in its stock price.
These investments by tech giants underscore a growing trend in the industry. As artificial intelligence and data centers drive up energy demands, companies are turning to nuclear power as a potential solution. Morgan Stanley analysts have dubbed this shift a “nuclear renaissance,” projecting $1.5 trillion in investment for new capacity through 2050.
The surge in nuclear energy stocks extended beyond SMR-focused companies. Cameco, a major uranium refiner, broke out past a buy point, jumping 7.8% to $55.77. Other nuclear-related stocks also saw gains, with S&P 500 component Vistra rising 5.7% and Constellation Energy advancing 5.1%.
This renewed interest in nuclear power comes as tech companies seek reliable, low-carbon energy sources for their expanding operations. McKinsey & Co. projects that data center energy demand in the U.S. will grow from around 4% currently to 11%-12% by 2030. The partnership between tech and nuclear industries is seen as a potential solution to meet this increasing demand while aligning with sustainability goals.
Companies like Oklo and NuScale Power, despite their stock market gains, are yet to produce significant amounts of power. The timeline for SMR deployment, as evidenced by Google’s deal with Kairos Power, extends well into the next decade.
The nuclear power industry, while gaining momentum, still faces challenges. Public perception, regulatory hurdles, and the need for substantial capital investment remain significant factors. A
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