Nuclear Energy's Strategic Alignment with AI Infrastructure: A New Era of Clean Energy Innovation

The rapid ascent of artificial intelligence (AI) has triggered an unprecedented surge in global energy demand, with data centers and computational infrastructure consuming an estimated 2% of the world's electricity today. As AI models grow in complexity and adoption accelerates, the need for reliable, carbon-free power sources has become critical. Nuclear energy-particularly Small Modular Reactors (SMRs)-is emerging as a linchpin in this transition, offering a strategic alignment between AI's insatiable energy needs and the global push for clean energy innovation.

The Energy Demands of AI and the Rise of SMRs

AI infrastructure requires not only vast quantities of electricity but also uninterrupted, high-quality power to sustain operations. Traditional energy sources, including fossil fuels and even intermittent renewables, struggle to meet these demands at scale. Nuclear energy, however, provides a stable, low-carbon alternative. Small Modular Reactors (SMRs), with their modular design and scalability, are uniquely positioned to power data centers and AI hubs.

The United States has taken a leading role in this convergence. According to the 2025 industry report, in 2025 the country committed to tripling its nuclear capacity, with Amazon Web Services (AWS) spearheading a $20 billion initiative to convert the Three Mile Island reactor into a carbon-free AI-ready data center. Similarly, Google and Microsoft have invested heavily in SMR partnerships: Google is deploying molten salt reactors from Kairos Power, while Microsoft secured 837 MW of carbon-free power by restarting Three Mile Island. These projects underscore a clear strategic alignment between AI innovation and nuclear energy.

China, too, is accelerating its nuclear expansion, targeting 200 GW of capacity by 2030 and 400–500 GW by 2050 to fuel its AI infrastructure. The country's Linglong One SMR, the first commercial land-based SMR to operate in 2023, is a testament to its ambition. Canada and the UK are following suit, with Canada approving a CAD 7.7 billion BWRX-300 reactor at Darlington and the UK backing Rolls-Royce's 470-MW SMR design with £280 million in government funding.

Technological Advancements and Global Deployment

SMRs are not a monolithic technology but a diverse portfolio of designs tailored to AI infrastructure needs. First-generation SMRs, such as NuScale's 77-MW modules and GE Hitachi's BWRX-300, rely on proven light-water reactor technology and are projected to be deployed by 2030. These reactors offer grid flexibility and can be scaled to meet the growing power demands of data centers.

Advanced reactor designs, including Generation IV molten salt and high-temperature gas reactors, promise even greater capabilities. Molten salt reactors enable continuous operation and high-temperature outputs, which can be harnessed for hydrogen production and industrial process heat-applications that could further decarbonize AI-related industries. Microreactors, such as Oklo's Aurora (1-30 MW), are ideal for remote locations or edge computing facilities, with Oklo securing agreements for 12 GW of deployment by 2044.

Strategic Policy and Regulatory Support

The strategic alignment between AI and nuclear energy is not just technological but also policy-driven. The U.S. AI Action Plan emphasizes grid modernization, streamlined permitting, and infrastructure investment to align with AI-driven energy demands. Executive Order 14300 has reduced reactor review timelines from 5–7 years to 18 months, while the Nuclear Regulatory Commission is developing a licensing framework tailored to advanced reactors. Internationally, the IAEA's Nuclear Harmonization and Standardization Initiative aims to streamline global deployment by addressing regulatory fragmentation.

However, challenges persist. High capital costs and reliance on Russian-sourced HALEU fuel remain significant hurdles. Domestic HALEU production is under development, but investors must monitor progress in this area.

Investment Implications

For investors, the convergence of AI and nuclear energy represents a high-conviction opportunity. The SMR market is projected to grow from $12 billion in 2025 to over $100 billion by 2040, driven by AI infrastructure demand. Key players like X-energy (AWS partner), Kairos Power (Google partner), and Rolls-Royce (UK-backed) are positioned to benefit from this growth. Additionally, countries with aggressive nuclear expansion plans-China, the U.S., and Canada-offer attractive markets for SMR deployment.

The strategic alignment between AI and nuclear energy is not a fleeting trend but a foundational shift in how the world powers its digital future. As AI reshapes industries, the ability to scale clean, reliable energy will determine the pace of innovation. Nuclear energy, with its technological adaptability and policy support, is poised to lead this transformation.