Sam Altman’s Startup Soars 100% as Big Tech Bets Big on Nuclear Energy

Amazon and Google announced their decision to invest in developing the emerging Small Modular Reactors or SMRs Technology. SMRs do not exist now. But some companies are trying to develop the technology. In March of this year, Amazon paid $650 million for a Talen Energy nuclear energy-powered data center campus in Pennsylvania. This can be seen as an early move towards the path of nuclear energy.

The interest in nuclear power is beneficial for an industry in the US that has shown a flat energy generation for a decade. The largest cloud data centers and AI Operators like Amazon, Microsoft, Alphabet, and Meta are also looking towards Nuclear power as a solution to increasing energy consumption from data centers. This created an upsurge in the share values of producers.

The Impressive Leap: Sam Altman and OKLO

OKLO is a nuclear power company in which OpenAI chief Sam Altman is an investor. Its shares have climbed 150% in the last month. The stock was 50% high for almost this year. However, OKLO showed a decline of  5% during the mid-day trading of Thursday. OKLO ‘s aura powerhouses can produce 15 megawatts of electrical power(MWe) that can be increased to 50 megawatts of power and can be operated for ten years without refueling.

OKLO ‘s shares have been increasing since Microsoft made a power purchase agreement for twenty years with Constellation Energy. Constellation energy owns most of the US power plants. As a part of the agreement constellation will be restarting the Unit 1 reactor at Three Mile Island. The share price of Constellation rose by around 36 % in the last month itself. The stock price increased to 138 % so far this year.

As per the deal with Microsoft, Constellation will launch the Crane Clean Energy Center. Microsoft will be purchasing energy from the Unit 1 reactor to fulfill its sustainability goals. Constellation energy demand grows as a result of artificial intelligence and data centers. The constellation energy has excess reserves and can absorb more growth in demand. The company is trying to improve the capacity to 1000 MW.

A study by the Pennsylvania Building and Construction Council found that the Crane Clean Energy Center which is going to be released online by 2028 will be adding more than 800 MW of carbon-free electricity to the power grid.

A California-based company having three project sites stated that they are developing next-generation fission powerhouses to produce abundant affordable clean energy on a global scale.

Google also announced that it has signed the world’s first corporate agreement with Kairos Power to purchase nuclear energy. Kairos Power is a California-based Small modular reactor developer company. Google said that it expects the first SMR online to be released by the end of this decade.

AI and Nuclear energy

The Artificial intelligence energy wave will drive the nuclear power and utility stocks in 2024. 

In this decade Artificial intelligence and data centers required to train the systems are expected to boost energy requirements. The current growth of demand is about 4%  total energy demand for data centers of McKinsey &Co. It is expected to have a growth of 11-12 percent by total energy demand by 2030.    

Many Technology companies like Morgan Stanley are investing in or partnering with nuclear power providers for the power supply to their data centers. Analysts of Morgan Stanley regarded it as an upcoming nuclear renaissance. They declared that nuclear power will come back as a power source irrespective of contradictions. The firm plans also to invest $ 1.5 trillion in new capacity through 2050. The constellation Microsoft deal is proof of nuclear power for hyper scalers with a high price for future deals.

Read More:

IEA World Energy Outlook 2024 Analysis

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