There are surprisingly strong synergies between nuclear energy and artificial intelligence.
In many ways, nuclear energy stocks today can almost be considered AI stocks. That's because the multitrillion-dollar global data center build-out to support AI technologies requires an increasing number of new energy sources to come online. Nuclear energy is an ideal solution for many reasons. Nuclear energy typically offers low carbon emissions, reliable baseload power, and limited refueling requirements.
But it's not just AI companies that are looking into nuclear. Nuclear companies are now looking into AI.
NYSE: OKLO
Key Data Points
This nuclear energy company is going all in on AI
Last month, Oklo Inc. (OKLO 0.17%) -- a nuclear energy developer specializing in small modular reactors (SMRs) -- announced a partnership with the Battelle Energy Alliance, a government-owned facility focused on nuclear energy research. The goal of the partnership is to accelerate the use of AI technologies for designing and building next-gen nuclear reactors.
In this way, Oklo now has two main exposure points to AI. Most of its customer pipeline consists of AI companies. And now, it plans to use AI itself to improve its own produce pipeline.
If you're bullish on AI in general, Oklo is emerging as a promising potential stock pick. Shares are down by nearly 70% since their highs last summer. Its market cap is now down to just $10 billion -- down from a peak of around $30 billion.
Image source: Getty Images.
Oklo isn't a traditional nuclear energy developer. It is pioneering a unique approach to nuclear power using small modular reactors (SMRs). Only a small handful of SMRs are in operation worldwide. And while SMRs have many benefits versus conventional nuclear power plants -- including lower initial costs and faster construction times -- this type of nuclear infrastructure has yet to take off in any meaningful way.
But tailwinds for SMR adoption are emerging. AI data centers will need vast amounts of new energy capacity to come online over the next few years and decades to support growth. Most forms of energy are set to benefit. Because they are faster to build and can be expanded with more reactor modules down the line, SMRs are a potential fit for meeting AI's rising energy demands.
There is clear buy-in from the U.S. government to expand SMR infrastructure. Oklo's partnership with the Battelle Energy Alliance reportedly gives it "access to specialized national-lab expertise and facilities." The ultimate goal is to enable Oklo to innovate faster by designing, building, and obtaining regulatory approval in record time.
"By leveraging AI-enabled technologies, national laboratory expertise, and industry collaboration, we are accelerating the development of next-generation reactors to support our nation's energy goals," Rian Bahran, the Deputy Assistant Secretary of Energy for Nuclear Reactors at the U.S. Department of Energy, said in a press release.
Oklo deserves a closer look by both AI and nuclear energy investors.
