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Nuclear-Powered Data Centers: The Next Big Thing?

by Team Lumida
May 24, 2024
in Markets, Nuclear Renaissance
Reading Time: 3 mins read
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Key Takeaways

  1. White House endorses nuclear energy, including SMRs, for sustainable data centers.
  2. AWS leads with a 960 MW data center connected to a nuclear plant.
  3. New SMR technology promises safer, scalable, and reliable power for data centers.

What Happened?

The White House Office of Science and Technology Policy has officially endorsed nuclear power, including small modular reactors (SMRs), as a sustainable energy source for data centers. At Data Center World 2024, Assistant Director Rian Bahran emphasized the increasing energy consumption of data centers, which account for 1-2% of annual US energy use.

Amazon Web Services (AWS) has already acquired a 1,200-acre site in Pennsylvania, connected to a 2.5 GW nuclear plant, and plans to expand its data center capacity to 960 MW. Bahran highlighted that nuclear power provides a stable and firm backbone, complementing renewables like wind and solar.

Why It Matters?

The endorsement marks a significant shift in energy policy, opening doors to reversing the trend of closing nuclear power facilities. This move addresses the growing power demands of data centers, especially with the rise of AI technologies. Nuclear energy offers a reliable and carbon-free solution, supporting job creation and emissions reduction.

The Inflation Reduction Act and state-level actions have made nuclear power economically competitive, evidenced by the $1.5 billion commitment to repower the Palisades nuclear plant in Michigan. Nuclear power is now seen as essential for maintaining grid stability and meeting future energy needs.

What’s Next?

Expect an increase in data centers located near nuclear plants, with AWS and other hyperscalers likely announcing similar plans. SMRs will play a pivotal role, with 2 GW of new-build nuclear projects expected over the next five years. Companies like Standard Power and NE Edge are already planning to deploy multiple SMRs.

The nuclear fleet’s recommissioning will ensure a continued clean energy supply, with modernized plants operating for decades. The next few years will see a blend of large-scale nuclear facilities and smaller, modular reactors powering data centers, making nuclear energy a cornerstone of sustainable tech infrastructure.

Source: Datacenterknowledge
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Lumida's website (referred to herein as the "Website") is limited to the dissemination of general information pertaining to its advisory services, together with access to additional investment-related information, publications, and links. Accordingly, the publication of the Website on the Internet should not be construed by any client and/or prospective client Lumida’s solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the Internet.

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