Utility Sector Ideas

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>>> Microsoft goes nuclear to power AI data centers


Yahoo Finance

by Julie Hyman and Josh Lipton

September 20, 2024


https://finance.yahoo.com/video/microsoft-goes-nuclear-power-ai-204151380.html


Nuclear energy has been a hot topic in investors' minds after Microsoft (MSFT) and Constellation Energy (CEG) announced an agreement to restore a dormant nuclear power plant to power the tech company’s AI and cloud data centers.

Microsoft wants to restore the Three Mile Island nuclear power plant in Londonderry Township, Pennsylvania, known for one of the largest nuclear disasters in the US when one of the plant's two reactors melted down in 1979.

Radiant Energy Group founder and managing director Mark Nelson joins Josh Lipton and Julie Hyman to explain how nuclear energy could power the artificial intelligence era.

A nuclear engineer himself, Nelson explains that the plant’s other reactor “kept going for 40 years. The only reason it closed in 2019 is because fossil fuels were really cheap.”

He says there’s a renewed interest in nuclear energy today because “we're running out of other energy sources… we're running out of power, and we're realizing that if we're going to have everybody buy electric vehicles, we have to be able to charge it from power plants that run all the time.”

Nuclear power plants could help meet the energy-intensive needs of training and running AI, which has brought the utilities sector into focus. Nelson says building new nuclear plants and restoring existing ones could help.

“The very best American design for a nuclear plant is being built in China over and over again for about four years or so per reactor and about $3 billion. I don't think we're going to meet China's prices for building our reactors, but we could probably do a lot better building our reactors if we do it in series with the same design, the same plant layout, and we do it over and over," the expert tells Yahoo Finance.

“Fortunately, we've got designs that are licensed and ready to go today at existing nuclear plants that already serve tens of millions of customers. And those are the plants that are being approached by the data centers. So I think to get over this hump, we have to accept that we've got outstanding equipment ready to install. We've just forgotten how to do it and we need to do it the same way every time.”

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