Meta Will Buy Startup’s Nuclear Fuel in Unusual Deal to Power AI Data Centers
The company, Oklo, plans to use the fuel at a 1.2-gigawatt plant in Ohio that's due as early as 2030.
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Nuclear fuel pellet / NRC via Wikimedia Commons
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As data-center energy bills grow exponentially, technology companies are looking to nuclear for reliable, carbon-free power. Meta has now made an unusually direct bet on a startup developing small modular reactor technology by agreeing to finance the fuel for its first reactors.
The nuclear industry’s flagging fortunes have rebounded in recent years as companies like Google, Amazon, and Microsoft have signed long-term deals with providers and invested in startups developing next-generation reactors. US nuclear capacity is forecast to rise 63 percent in the coming decades thanks largely to data-center demand.
But Meta has gone a step further by prepaying for power from Oklo, a US startup building small modular reactors. Oklo will use the cash to procure nuclear fuel for a 1.2-gigawatt plant in Ohio that could come online as early as 2030.
The deal is part of Meta’s broader nuclear investment strategy. Other agreements include a partnership with utility company, Vistra, to extend and expand three existing reactors and one with Bill Gates-backed TerraPower to develop advanced small modular reactors. Together, the projects could deliver up to 6.6 gigawatts of nuclear power by 2035. And that’s on top of a deal last June with Constellation Energy to extend the life of its Illinois power station for a further 20 years.
"Our agreements with Vistra, TerraPower, Oklo, and Constellation make Meta one of the most significant corporate purchasers of nuclear energy in American history," Joel Kaplan, Meta's chief global affairs officer, said in a statement.
While utilities commonly negotiate long-term fuel contracts, this appears to be the first instance of a tech company purchasing the fuel that will generate the electricity it plans to buy, according to Koroush Shirvan, a researcher at MIT. "I'm trying to think of any other customers who provide fuel other than the US government," Shirvan toldWired. "I can't think of any."
Part of the reason for the unusual deal is that securing fuel for advanced reactor designs like Oklo’s is not simple. The company requires a special kind of fuel called high-assay low-enriched uranium, or HALEU, which is roughly four times more enriched than traditional reactor fuel.
This more concentrated fuel is critical for building smaller, more efficient nuclear reactors. American companies are racing to grow the capacity to develop this fuel domestically, but at present, the only commercial vendors are Russia and China. And with a federal ban on certain uranium imports from Russia, the price of nuclear fuel has been rising rapidly.
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Oklo will use the cash from Meta to secure fuel for the first phase of its Pike County power plant, which will supply the grid serving Meta's data centers in the region. The facility is targeting a 2030 launch, though it won’t be producing the full 1.2 gigawatts until 2034.
It’s a somewhat risky bet for the tech giant. The Nuclear Regulatory Commission rejected Oklo’s licence application in 2022, and it has yet to resubmit. An anonymous former NRC official who dealt with the application recently told Bloomberg the company "is probably the worst applicant the NRC has ever had.”
But Meta isn’t putting all its eggs in one basket.
The deal with TerraPower will help fund development of two reactors capable of generating up to 690 megawatts by 2032, with rights for energy from up to six additional units by 2035. "We're getting paid to start a project, which is really different," TerraPower CEO Chris Levesque told The Wall Street Journal. "This is an order for real work to begin a megaproject."
And the agreement with Vistra is more conventional. Meta is committing to purchase more than 2.1 gigawatts over 20 years from the existing capacity of the utility’s Perry and Davis-Besse plants in Ohio. It will purchase another 433 megawatts from expanding capacity at both plants as well as the Beaver Valley plant in Pennsylvania. All three plants had been expected to close just a few years ago, but Vistra is now planning to apply for licence extensions.
The three deals represent a bold bet on nuclear power’s potential to meet AI’s future energy demands. The big question is whether AI will still rely on the same kind of power-hungry models we have today by the time these plants come online next decade. Regardless, the current AI boom is helping power a nuclear renaissance that we may all benefit from in the years to come.
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