Reuters Report on SMR 2024 - On Closing in on Commercialization - 2024

Nuclear Power Industry

In 2023, May saw the signing of Microsoft in a kind-a-of-first purchase-power agreement to buy carbon-zero electricity from a little-known electricity energy provider with supplies due to begin around 2028. Such agreements are commonplace these days as tech giants seek to decarbonize their supply chains, and the amount in question—50 megawatts (MW)—was trivial compared to the gigawatts (GW) of electricity that Microsoft consumes every year.

What made this deal newsworthy is that it involved procuring electricity from an energy source that does not yet exist....SMRs.

Supplier Helion Energy is touting a technology called nuclear fusion, which could generate almost limitless amounts of energy—and is becoming tantalizingly close to commercial reality after decades of development and around $5 billion in private funding.^{Reference 1} The fact that fusion is not yet a proven technology has not dampened the tech sector’s enthusiasm for its potential, with ChatGPT developer OpenAI also looking to tap Helion for “vast quantities” of energy, according to reports in June 2024.^{Reference 2}

Like others in the tech sector, Microsoft and OpenAI—which has backing from the Redmond-based behemoth—face mounting power requirements as they roll out increasingly complex artificial intelligence (AI) systems. The two firms are said to be planning to open a joint AI data center in 2028 that will consume a whopping 5 GW of power.

AI’s immense energy needs are one of several factors driving interest not only in fusion but also another form of nuclear energy that has much greater chances of commercialization, according to speakers at Reuters Events’ SMR & Advanced Reactor 2024 conference in May. The 2025 conference should be even more encouraging (here).

Unlike fusion, advanced and small modular reactor (SMR) technology is based on established nuclear fission processes and, while still subject to some commercial uncertainty, could be a much safer bet for AI-related clean energy demand, experts believe.

“Our goal is to deliver data center infrastructure in a way that provides the least environmental impact, and webelieve advanced nuclear is helpful in achieving that,” said Microsoft’s director of nuclear development acceleration, Erin Henderson, at SMR & Advanced Reactor 2024.

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