All of a sudden, nuclear energy is trendy.

In the last month, three big tech companies, Microsoft, Alphabet, and Amazon, have all signed deals for nuclear energy. That’s not a coincidence. The AI race is forcing the tech giants to reckon with how to power the massive data centers they’re building to run AI applications like ChatGPT.

In fact, the biggest constraint in AI may not be the technology itself, but a source of cheap and available energy, and that’s why the world’s most valuable companies are turning to nuclear, a seemingly forgotten source of energy.

Among the backers of this re-emerging technology is Bill Gates, the Microsoft co-founder who has become an investor and philanthropist in a wide range of areas. Gates has invested more than $1 billion in TerraPower, a privately held start-up that is building small nuclear reactors. The billionaire sees nuclear energy as necessary for bridging the gap in renewable energy and told The New York Times, “If you care about climate, there are many, many locations around the world where nuclear has got to work.” He also said he’s not involved in TerraPower to make money, but “because we need to build a lot of these reactors.”

Since TerraPower is privately held, you can’t invest in it, but there’s a similar stock that you can buy. That’s NuScale Power (NYSE: SMR), and the stock is up more than 400% this year as it’s riding the wave of enthusiasm for nuclear power.

NuScale was founded in 2007 and is focused on developing small, modular reactors. Its core technology, the NuScale Power Module (NPM) can generate 77 megawatts-electrical (MWe).

It’s developing the VOYGR power plant that can include as many as 12 NPMs. NuScale’s technology offers an advantage over renewable alternatives like wind and solar because it generates an equivalent amount of power in a much smaller space, making a more efficient use of land.

NuScale is also the only small modular reactor (SMR) company to have received a standard design approval (SDA) from the U.S. Nuclear Regulatory Commission.

NuScale also benefits from a close relationship with Fluor, a top engineering, procurement, and construction company that is the majority shareholder in NuScale Power.

The company has yet to generate any material revenue today as it has not yet sold any NPMs, though it’s made some negligible service revenue. NuScale faced a setback in 2023 when it canceled a project in Idaho that was expected to build momentum for new nuclear projects. The project was plagued by cost overruns and a lack of sufficient electricity buyers to make the project viable.

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