Energy Review: Part 2 - Nuclear

In the last article, the outlook for renewables looked pretty bleak. 

However, a glimmer of hope lies within the nuclear energy industry.

Recently, a US startup has raised $425m in a mission to start producing electricity from nuclear fusion in 2028. The startup, Helion, has found backing from SoftBank, Sam Altman, Mithril Capital and Nucor allowing it to reach a valuation of nearly $5.5bn. 

The company has not only garnered support from the AI industry through Sam Altman, but it has also broken big tech by being awarded a contract to start supplying Microsoft with its fusion system by 2028.

However, recently, doubts have been sowed surrounding investor interest and demand issues if AI training and operating turn out to be less energy intensive than first estimated. This topic has been particularly pressing following the release of Deepseek which proved that equivalent AI models could be built using significantly less energy than their US counterparts. For more information on how Deepseek disrupted the AI industry, read ‘Seek or Swim: Nvidia swims onwards’.

Despite this, chief executive David Kirtley has reassured industry sceptics that energy-efficient AI models “would not change anything” for the success of Helion. He added, “There is a huge need [for baseload power] even more than we thought before. So if that extra need is a little bit less, that is OK too”.

Further than this, X-energy has raised $700m to fund the construction of small, modular nuclear reactors. They are joined by the likes of Newcleo, Blue Energy, Last Energy and Nano Nuclear Energy who have raised hundreds of millions, totalling over $1.5bn in investment over the past few months. 

The reactors that these companies specialise in are smaller and more flexible than traditional reactors, referred to as SMRs. 

SMR’s flexibility and scalability have been recognised as attractive to big tech firms in particular, who seek to continue AI development utilising as much clean energy as possible. 

Tech companies are enthusiastic about the technology with Meta currently in talks with SMR developers, Google already brokering a power supply deal with an SMR developer and Amazon going as far as purchasing a stake in X-energy. 

So despite the shift away from renewables under the current geopolitical climate, nuclear remains a bastion for clean energy, maintaining both investor interest and technological progress in the field.