NextEra Energy (NEE, Financial) CEO John Ketchum highlighted that the U.S. requires an addition of 900 GW to meet future energy demands by 2040, with nuclear energy contributing only a small portion. He expressed skepticism about the economic viability of small modular reactors (SMRs) in the company's recent earnings call. Ketchum noted that despite potential challenges, such as competition for regional wind resources, few nuclear plants might be economically viable to restart, including the Duane Arnold plant in Iowa.
Ketchum is cautious about the potential of SMRs, asserting that the company's SMR team has not yet found definitive economic benefits. He also raised concerns about the availability of nuclear fuel in the U.S., stating that SMRs remain costly despite a decline in renewable energy costs, and emphasized prioritizing other power resources.
The rise in energy demands from sectors like artificial intelligence and computing has spurred interest in SMRs. Oklo (OKLO), a developer of small nuclear plants, noted that nuclear facilities are ideal for data centers. Amidst growing interest in nuclear energy as a pivotal player in the AI sector, companies like NuScale Power (SMR) have seen stock increases.
The U.S. is also in talks with Southeast Asian nations, including the Philippines, Singapore, and Thailand, about deploying SMRs. Andrew Light from the U.S. Energy Department confirmed discussions on intergovernmental talks about current SMR arrays, which offer a cost-effective and faster-to-build alternative to traditional nuclear facilities. Their modular design and shorter construction times make them suitable for small-scale and dispersed grids, effectively addressing emerging market and remote area power needs.
Interest from tech giants in SMRs is growing, with Google signing a deal with Kairos Power to purchase power from planned SMRs. The deal includes power purchase agreements for delivery by 2030-2035. Similarly, Amazon has committed to investing in SMRs alongside Dominion Energy at the North Anna site.
The U.S. Nuclear Regulatory Commission held public meetings with Constellation Energy (CEG) regarding the restart of Pennsylvania's Three Mile Island nuclear plant, with plans to sell energy to Microsoft (MSFT). Oracle (ORCL) Co-founder Larry Ellison revealed plans for a data center powered by three SMRs to meet over 1 GW of power demand.
