- Big Tech companies are exploring small modular reactors, or SMRs, for AI energy solutions.
- Four SMR companies have received nearly $3 billion in equity funding.
- Leading nuclear experts say it's unclear if SMRs will be the best solution for AI's energy demands.
Big Tech companies are eyeing small modular reactors as an AI energy solution — even as some remain unsure about its potential.
There's no official standard that defines a small modular reactor, or SMR, according to two leading nuclear experts who spoke with Business Insider. The industry consensus is that they produce less power — around 300 megawatts instead of the 1,000 megawatts, or 1 gigawatt — than a traditional reactor.
The SMR playing field is also relatively small.
Data compiled from CB Insights and Pitchbook showed that over the past eight years, only four companies received about 92% of the nearly $3.2 billion in equity funding that went to SMR-focused firms.
Those companies include X-energy, Bill Gates' Terrapower, NuScale, and the Paris-based Newcleo.
"It's new, and it's old at the same time," Allison MacFarlane, former US Nuclear Regulatory Commission chairman, said of SMRs in an interview with Business Insider. MacFarlane was referring to how many SMR designs have yet to be demonstrated in real life, but the technology the reactor is based on has been around for many decades.
Tech companies like Alphabet, Amazon, and Microsoft are investing in the technology with the hope of finding a sustainable and reliable energy source to meet the increasing power demands of artificial intelligence and data centers.
In a March report, the Center for Strategic & International Studies estimated that new energy demands for all US data centers will reach 40 to 90 gigawatts by 2030. That's equivalent to simultaneously powering four to nine New York Cities during peak demands in the middle of the summer.
The CSIS number is just one estimate, however: The uncertainty around how much energy AI and data centers will require in a short time is one reason nuclear experts who spoke with BI say it's unclear if SMRs will be a key player in the solution.
"It'll depend on the size of the data centers," Jacopo Buongiorno, director of MIT's Center for Advanced Nuclear Energy Systems, said in an interview. "The hyperscalers — I understand that the latest (centers) that are proposed is close to a gigawatt, in which case it probably makes more sense to have a large reactor."
There are no SMRs up and running in the United States. According to the Nuclear Energy Agency, three are in China, Russia, and Japan.
The earliest — and most optimistic — timelines to get an SMR online in the US will likely be around 2030, with TerraPower's Natrium SMR currently under construction in Wyoming and X-energy's Xe-100 on the Texas Gulf Coast.
Here's a quick look at the four SMR companies that have received the most equity funding as of 2025. Dollar figures exclude funding from public-private partnerships.
X-energy, $1.1B
Founded in 2009 by Kam Ghaffarian, an Iranian businessman who also co-founded Axiom Space, X-energy is designing a high-temperature gas-cooled SMR, or HTGR," called the Xe-100 — different from the light-water reactors operating in the US.
The Xe-100 is what's known as a "pebble bed model," which extracts electricity by tightly packing together thousands of "pebbles" the size of billiard balls coated with uranium fuel particles, according to the Department of Energy.
The model has been demonstrated abroad, according to McFarlane.
"Germany had one, and China has one right now that's operating," MacFarlane said. "What the Germans found with theirs is that these pebbles — these sort of grapefruit-sized fuel elements, if you will — created a huge amount of dust which made a really big radioactive mess."
Robert McEntyre, a spokesperson for X-Energy, told BI in a statement that "Xe-100 meets the highest safety and operational standards, backed by over 50 years of HTGR development," adding that technical experts at the company say the assertion that the German SMR's dust issues created a radioactive mess is "inaccurate."
X-Energy announced a partnership with Dow in 2022 to install the Xe-100 at one of the chemical production company's Gulf Coast sites and have it online by 2030.
"It's a big chemical plant that uses a lot of electricity and a lot of heat," Buongiorno said of the Gulf Coast site. "And at the moment, it gets both from burning natural gas."
X-energy also announced a $500 million Series C-1 funding round anchored by Amazon in 2024. The two companies plan to bring SMRs generating a total of 5 gigawatts of energy online in the US by 2039.
"Our proven technology offers one of the most cost-effective and safest ways to bring net-new clean energy to market," McEntyre said. "Amazon and Dow are not just off-takers but strategic partners in our effort to be a first-mover on advanced nuclear."
TerraPower, $880M
TerraPower was co-founded by Gates, a vocal proponent of nuclear energy, in 2008.
The company is building a sodium-cooled fast reactor — using liquid metal rather than water as a coolant — in Wyoming. Terrapower calls it the Natrium reactor and plans to get in online by 2030.
Buongiorno calls the estimated arrival date a bit optimistic by a couple of years or so for two reasons.
One, the supply chain for the enriched uranium — the fuel that will power the reactor — is still being established in the US, he said.
"At the moment, there is no supply chain in the US," Buongiorno said. "There is in Russia, there is in China, but for obvious reasons, we can't do business with either one."
The second reason is that Natrium will be the first reactor Terrapower ever built.
"They are bound to have challenges they haven't thought about," he said, pointing to potential hiccups with the supply chain and licensing processes or other regulatory hurdles.
A TerraPower spokesperson said in a statement to BI that the company has "rapidly established a reliable supply chain, recently securing contracts for all long-lead components needed for construction, and today announced an agreement to establish a manufacturing supply chain to assist in the development of multiple reactors."
"We are actively constructing the non-nuclear portions of the Natrium commercial demonstration plant in Kemmerer, Wyoming," the spokesperson said. "Furthermore, the US Nuclear Regulatory Commission recently announced that our safety evaluation is ahead of schedule."
In January, the company announced a deal with Sabey Data Centers to explore deployment opportunities for its Natrium reactors in the Rocky Mountain region and Texas.
Newcleo, $585M
Newcleo is a new player in the reactor field that launched in 2021 and is based in Paris. It was founded by Italian physicist Stefano Buono, an alum of the European Organization for Nuclear Research.
The company specializes in lead-cooled fast reactors, which use liquid or molten lead as a coolant.
"It's a design that was actually demonstrated by the Russians on some of their submarines back in the '70s," Buongiorno told BI. "So nothing is entirely new here, my friend."
Newcleo said in February that it started the land acquisition process to build its first lead-cooled fast reactor in France by 2031. It will serve as a demonstrator reactor, showcasing the viability of the SMR design, according to a company press release.
A Newcleo spokesperson told BI that the company "benefits from strong public recognition and support both in France and across Europe and is one of only two Advanced Modular Reactor projects selected by the European Industrial Alliance on Small Modular Reactors."
NuScale Power, $468.7M
NuScale was founded in Corvallis, Oregon, in 2007 by José Reyes, a fellow of the American Nuclear Society, and Paul Lorenzini, former CEO of Powercor Australia electric provider. The company went public in 2022.
NuScale's SMR designs are based on the more common light-water reactor.
"I'm kind of simplifying, but it is essentially a smaller version of large pressurized water reactors, which are the backbone of the nuclear industry as we have known it for decades," Buongiorno said.
NuScale CEO John L. Hopkins said during the company's fourth-quarter earnings call on March 3 that light-water SMRs give NuScale an edge over others in the SMR space because they're "not burdened by the additional hurdles faced by non-light water reactor SMR technologies."
But NuScale has not been without challenges.
Although the company has agreements to develop SMRs in Ghana, Romania, and Poland, NuScale has yet to ink a deal to develop one of its reactors in the US.
Plans to build six of NuScale's 77-megawatt reactors in Idaho were terminated in 2023 because the project failed to attract enough customers to support soaring costs stemming from inflation, Hopkins said during an earnings call in November 2023.
The company said in an earnings presentation that NuScale has seen increased interest across the board.
"In an era where more energy is necessary to fortify the US electricity grid, power economic growth, and bolster America's global competitiveness, the need for new nuclear is becoming a reality," Hopkins said during the fourth-quarter earnings call.
