Developers of small modular nuclear reactors have raised at least $1.5bn in funding over the past year, tapping into a surge of investor interest linked to power supply deals agreed with Big Tech.
They have also secured pledges of billions of dollars of support from governments, amid a global race to launch new technologies considered critical to powering the artificial intelligence revolution.
The largest fundraising of $700mn was closed this month by X-energy, a US developer that added Jane Street and other institutional investors to a register that included technology giant Amazon, Ken Griffin, founder and chief executive of Citadel and chemical company Dow.
Paris-based developer Newcleo raised $151mn in September and US-based developers Blue Energy and Last Energy raised $45mn and $40mn respectively last year. Nano Nuclear Energy, a developer of microreactors which listed in May, raised $134mn capital in 2024.
Three SMR developers listed in New York, Oklo, NuScale and Nano Nuclear, raised more than $700mn through share sales and other financing mechanisms over the past 12 months, according to a Financial Times analysis of public records and data from PitchBook and BloombergNEF.
Westinghouse, Rolls-Royce, Holtec International, GE Hitachi and Bill Gates’ TerraPower are also among a host of companies investing in about 60 SMR projects globally, according to World Nuclear Association data.
Amazon’s purchase of a stake in X-energy and Google’s signature of a power supply deal with SMR developer Kairos Power, which both occurred in October, have shaken up a funding market that soured in 2023 due to high interest rates and inflation.
Improving investor sentiment has fuelled a surge in the share prices of Oklo and NuScale, which have seen their combined market capitalisation jump by almost $8bn following the deals. It has encouraged some early stage venture capital, providing more options for SMR developers.
Core Power, a UK-based company which designs reactors for the shipping industry, told the Financial Times it is close to finalising a $500mn fundraising round from strategic investors. Holtec International, one of four shortlisted bidders in a UK government competition for SMR developers, said it is exploring funding options.
“There has been a dramatic change in the capital markets for companies like ours,” said Clay Sell, chief executive of X-energy, adding the recent deals demonstrated how the technology industry now fully appreciates the role nuclear will play in providing reliable, clean power.
Surging power demand in the US caused, in part, by the rollout of AI data centres is causing the technology sector to underwrite part of the capital costs of deploying nuclear energy.
Last year Microsoft signed a 20-year power deal with Constellation Energy to reopen the Three Mile Island nuclear plant in Pennsylvania, citing its value as a source of emissions-free energy that would not dent climate targets.
But there are only a handful of nuclear plants that can be restarted in the US and building standard-sized reactors is considered risky due to a recent history of lengthy delays and cost overruns.
Instead, the technology industry is focusing on SMRs, which are new types of advanced nuclear reactors that have a power capacity of 300MW of less, or about a third of the size of standard facilities.
Oklo, which is chaired by Open AI’s Sam Altman, signed a non-binding agreement with Switch Inc, a large privately held data centre operator, to build reactors with a total capacity of up to 12 gigawatts — enough in total to power all 7.6mn households in New York state.
Meta is evaluating proposals from SMR developers for a tender to supply up to 4 gigawatts of capacity to support its data centre roll out in the early 2030s.
But analysts warn developers still face technical, regulatory and even funding risks despite the improved sentiment.
NuScale is the only SMR developer with a design approved by the US Nuclear Regulatory Commission.
TerraPower filed its construction permit application to the NRC last year and has begun preparatory construction work on a site in Wyoming but most companies have not started the process.
Developers want technology companies to finalise the dozens of non-binding memorandums of understanding they have signed to provide them with financial certainty.
“To see more SMR projects announced and move forward we need to see binding agreements, rather than MOUs,” said Marc Bianchi, analyst at TD Cowen, an investment bank.
Government funding is critically important for developers due to the risks associated with a first-of-a kind technology and a history of delays and budget overruns that have blighted nuclear projects, say investors.
“We have to have federal dollars. I just can’t underscore that enough,” Google’s head of energy market development, Caroline Golin, told a Nuclear Energy Institute conference in New York last week.
In the US, the Biden administration kick-started the industry by pledging billions of dollars in grants to X-energy, TerraPower and other developers. It also offered production tax credits of up to 50 per cent to support the deployment of SMRs in the inflation reduction act.
President Trump wants to repeal the IRA and has frozen billions of dollars of loans to the clean energy sector, prompting industry concerns over funding.
But the new secretary at the Department of Energy, Chris Wright, sat on the board of Oklo until his confirmation and the Republican party are strong supporters of nuclear energy, providing executives with hope that Washington’s support remains firm.
“We remain confident,” said Sell from X-energy. “The president has talked extensively about the role nuclear should play in this energy dominance strategy, which we strongly support.”
