In a significant development in the nuclear energy sector, startup Oklo has signed a massive deal with data center operator Switch to build enough small modular reactors (SMRs) by 2044 to generate 12 gigawatts of electricity for Switch’s data centers. The agreement would see Oklo building and operating the plants, selling power through Switch to its data center customers.
The Deal in Context
Oklo’s deal with Switch is a significant milestone in the company’s mission to provide clean and reliable energy to power-hungry data centers. Data centers are one of the fastest-growing consumers of electricity globally, and Oklo aims to meet this growing demand with its SMRs. The agreement would see Oklo building dozens to hundreds of its SMR power plants, with the first reactor online in 2027.
Caveats Abound
While the deal is significant, there are several caveats that need to be considered. Firstly, Oklo still hasn’t received approval from the Nuclear Regulatory Commission (NRC) after having its previous application denied in 2022. The company plans to resubmit a new application in 2025, hoping that new legislation taking effect next year will speed up the process.
Altman-Backed Oklo Faces Stiff Competition
Oklo’s ability to meet its internal deadlines and secure NRC approval is crucial for the success of the deal. However, even if the company receives approval, it still faces stiff competition from other nuclear startups in addition to renewable power projects. Kairos, one of Oklo’s competitors, has already received NRC approval and currently has a deal with Google to supply its data centers with electricity.
Renewable Power and Grid-Scale Batteries Gain Ground
The increasing competitiveness in the energy sector means that renewable power and grid-scale batteries are becoming more attractive options for data centers. Google announced last week that it was helping to anchor a renewable power deal that will see $20 billion worth of solar, wind, and batteries. The first phase of the project will be operational by 2026.
The Future of Energy
The future of energy is likely to be shaped by the intersection of nuclear power, renewable energy, and grid-scale batteries. Oklo’s deal with Switch highlights the potential for nuclear energy to play a significant role in meeting the growing demand for electricity from data centers. However, the company’s ability to navigate the regulatory landscape and deliver on its promises will be crucial to its success.
Timeline
- 2025: Oklo plans to resubmit a new application to the NRC
- 2027: First reactor online
- 2044: Enough SMRs built to generate 12 gigawatts of electricity
Conclusion
Oklo’s deal with Switch is a significant development in the nuclear energy sector. However, the company faces stiff competition from other nuclear startups and renewable power projects. The future of energy will be shaped by the intersection of these technologies, and Oklo’s ability to navigate this landscape will be crucial to its success.
Competitors
- Kairos: Already received NRC approval and has a deal with Google
- Renewable power: Becoming more attractive option for data centers due to decreasing costs
Key Players
- Oklo: Nuclear startup backed by Sam Altman
- Switch: Data center operator
- Google: Company with significant investment in renewable energy projects
Regulatory Landscape
- NRC: Regulatory body that has denied Oklo’s previous application
- New legislation: Taking effect next year, aims to speed up the approval process