NuScale Power: The Nuclear Stock Soaring on AI Demand

NuScale Power (SMR 11.35%) stock is flying today, up 12.7% as of 1:45 p.m. ET, after gaining as much as 14.5% earlier in the day. The upward movement comes as the S&P 500 and the Nasdaq Composite were up 1% and 4%, respectively. The International Energy Agency (IEA) released a research report on Thursday that was bullish on nuclear power at large, specifically mentioning the model NuScale is betting on as particularly promising. This report, coupled with the growing demand for clean, reliable energy from AI and other power-intensive technologies, has investors flocking to NuScale's stock.

Nuclear power has fallen out of fashion in many parts of the globe for decades, but the past year has seen a renewed interest as power demands from AI have ballooned. The IEA report noted that nuclear power is set to reach a new record in 2025 "as electricity demand accelerates." The technology is making "a strong comeback" as more than 40 countries around the world have plans to "expand nuclear's role in their energy systems." NuScale builds small modular reactors (SMRs), which are much smaller than traditional plants and can be manufactured offsite and delivered to the plant destination. This makes them much more adaptive and economically feasible for certain communities. SMRs were mentioned by the IEA report as offering "exciting growth potential," helping to send NuScale shares flying.



NuScale's SMR technology addresses the growing demand for clean, reliable energy from AI and other power-intensive technologies in several ways. First, NuScale's SMRs are modular, meaning they can be scaled to meet specific power needs. This makes them ideal for data centers and other power-intensive facilities that require a lot of energy but may not need a full-sized nuclear reactor. Second, SMRs produce clean, carbon-free energy, which aligns with the sustainability goals of many AI and technology companies. They also provide reliable baseload power, ensuring that data centers and other facilities have a consistent energy supply. Third, SMRs can be manufactured offsite and delivered to the plant destination, making them more economically feasible for certain communities. This adaptability can help reduce the upfront costs and time required to build a power plant, making it more attractive for AI and other technology companies to invest in.

Geopolitical factors, such as the U.S. government's support for nuclear energy, also play a significant role in NuScale's growth potential. The U.S. government has expressed its intention to at least triple U.S. nuclear energy production by 2050, which includes supporting the development of small modular reactors (SMRs) like those offered by NuScale. This commitment is a positive sign for NuScale's growth prospects, as it indicates a favorable regulatory environment and potential government support for the company's technology.

In conclusion, NuScale Power's stock is soaring today due to a combination of factors, including the IEA report's bullish outlook on nuclear power, the growing demand for clean, reliable energy from AI and other power-intensive technologies, and the U.S. government's support for nuclear energy. NuScale's SMR technology is well-positioned to meet the growing energy demands of AI and other power-intensive industries, and the company's stock is likely to continue to benefit from these trends. However, investors should remain cautious, as NuScale is still in its early stages and must prove that it can deliver on its promise.