Nuclear Energy Gains Popularity Among Tech Giants in the AI Era

Recently, major tech players like Microsoft, Alphabet, and Amazon have shown increasing interest in nuclear energy. This shift is no accident, as the demand for power in AI data centers escalates.

The evolution of AI may hinge less on technology and more on securing affordable energy, leading these companies to explore nuclear power, a previously neglected energy source.

Notably supporting this resurgence is Bill Gates, co-founder of Microsoft and a prominent investor and philanthropist. Gates has invested over $1 billion in TerraPower, a startup dedicated to creating small nuclear reactors. He views nuclear as essential for bridging the renewable energy gap, emphasizing its necessity for climate efforts. Gates stated in The New York Times, “If you care about climate, there are many, many locations around the world where nuclear has got to work.” He insists his involvement with TerraPower is anchored in necessity, not profit.

Although TerraPower is private and not publicly tradable, investors can look to NuScale Power (NYSE: SMR). Its stock has surged over 400% this year, benefiting from the renewed interest in nuclear energy.

Image source: Getty Images.

Understanding NuScale Power

Founded in 2007, NuScale specializes in small, modular reactors. Each NuScale Power Module (NPM) can produce 77 megawatts-equivalent (MWe). The company is working on the VOYGR power plant, which may incorporate up to 12 NPMs. This technology allows NuScale to generate equivalent power to wind or solar, but in a more compact space, making it land-efficient.

NuScale holds a significant advantage as the only small modular reactor (SMR) company to receive standard design approval (SDA) from the U.S. Nuclear Regulatory Commission. Its close partnership with Fluor, a leading engineering and construction firm, further strengthens its position. However, NuScale has yet to generate significant revenue, with only minor service income so far. A setback occurred in 2023 when it terminated a promising Idaho project due to budget issues and insufficient buyers for electricity.

Evaluating NuScale Power as an Investment

NuScale Power represents a high-risk investment. Despite lacking substantial revenue, momentum in the nuclear sector is growing, bolstered by actions from major tech companies and investments from billionaires like Gates. Nuclear energy holds the potential for both significant returns and a viable, climate-friendly energy solution as power demands increase with AI technologies.

NuScale’s synergy with Fluor also provides a boost, as they can assist in project development, customer outreach, and funding. Although NuScale’s current market cap stands at $1.7 billion with minimal revenue, some investors may find value in having a stake in the stock.

Given the potential role of nuclear energy in the future of AI, NuScale Power positions itself as a leader in the SMR field. For those willing to take risks, investing in NuScale Power now could yield significant rewards down the line.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Jeremy Bowman has positions in Amazon. The Motley Fool has positions in and recommends Alphabet, Amazon, and Microsoft. The Motley Fool recommends NuScale Power and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.