The Data Center Nuclear Energy Frontier: What Makes It Happen?

Sept. 6, 2024
How does the future electricity generation portfolio of the 2030s serve hundreds of new data centers totaling dozens of gigawatts without sacrificing carbon reduction goals and resiliency necessities?

In the debate around the use of nuclear reactors to fuel future data centers, many people are quick with an opinionated answer but they may not be asking the right question.

Of course, safety is the priority and the question is whether a U.S. reactor has ever caused any discernible health impacts on residents. The answer is no, not even at Three Mile Island more than 45 years ago.

Once past that, another question looms across the modern American energy landscape. Here it is: How does the future electricity generation portfolio of the 2030s serve hundreds of new data centers totaling dozens of gigawatts without sacrificing carbon reduction goals and resiliency necessities?

Ok that’s a long question so here’s a briefer query: What’s energy-dense, carbon-free and baseload power?

Nuclear, that’s what. Much remains to be seen on the feasibility, expense or even true public support for using small modular reactors (SMRs) to power the next generation of mission critical facilities, but that future debate was front and center in a Thursday session at the Data Center Frontier Trends Summit in Reston, Virginia.

Let's get small to deal with massive load

On many levels SMR nuclear may seem to make business sense. SMRs are clearly far more expensive and take longer to build than gas-fired power or diesel gen-sets, but the nation’s current fleet of utility-scale nuclear plants have performed ably for decades, generating more than half of the carbon-free power in the U.S. The ultimate dollar per MWh is fairly competitive.

SMRs are also designed to be cheaper and safer than traditional nuclear fission plants, such as the recent estimated $33 billion Vogtle expansion in Georgia. The next generation of advanced reactors would be powered by a more efficient fuel, built deeper in the ground and generate between 25 MW to 50 MW, on average, per unit.

“Nuclear is way more versatile” and reliable than other carbon-free fuels, James Walker, CEO of Nano Nuclear Energy, said during the Data Center Frontier Trends Summit session. “China came to this conclusion years ago, and they are building nuclear like crazy. They need that consistent power.”

So does the U.S., which may or may not choose SMR nuclear but has no choice but to find a way to match a forecast 40 GW of data center capacity growth over the coming decade. Advanced nuclear already is being pursued, in very early stages of course, by major industrial and technology firms from Dow to Amazon Web Services to Microsoft.

Center of the data universe

This part of northern Virginia, where the Data Center Frontier Trends Summit is happening at the Hyatt Regency Reston, is home to a massive new build of data centers. The paradigm around data center location has been focused on the proximity to fiber optic, but that is changing to consider siting new facilities where the ample electric power generation can be found.

“Virginia is doing great with data centers, but all of that [power] cannot be delivered,” noted Ralph Hunter, CEO of Orion Nuclear Energy Corp. and a former executive at nuclear generation owner utility Constellation Generation Development.

“You guys,” Hunter added, motioning to the crowd of data center developers, builders and suppliers, “will start going to different states.”

America’s coal-fired power generation fleet is in decline and almost certainly never to revive. Gas-fired power can only go so far if the nation wants to maintain a diverse portfolio of fuel resources. Solar and wind are intermittent and cannot guarantee a flexible, dependable supply of energy.

Enter nuclear, saddled with its longtime dangerous image that inspires fearsome memories of Chernobyl, Fukushima and Three Mile Island, and is surrounded by imagined miles and miles of radioactive, thousand-year waste. The truth is that those first two disasters were magnified by both severe human error and extraordinary circumstances, while Three Mile Island garnered chilling negative publicity but in reality did relatively little damage.

Educating on the facts of nuclear energy

Non-weaponized nuclear energy in the U.S. has powered Navy submarines for decades. Reactors also have generated close to a fifth of total utility-scale electricity, with far fewer of the respiratory or other health issues derived from clouds of coal-fired emissions.

On the waste issue, as the U.S. Department of Energy has pointed out, decades of nuclear fission haven’t yielded more than a football field’s worth of waste nationwide.

Nuclear fuel bottlenecks, both spent and otherwise, will be a solved problem with a tighter uranium supply chain in the coming decade, said Brian Gitt, head of business development for microreactor designer Oklo. The U.S. government has allocated $2.7 billion toward domesticating the uranium supply line instead of importing from Russia and other sources.

Oklo also plans to build a recycling facility for spent fuel rods. Some 90% of available energy is still in those small cylinders, he estimated.

“We could power the U.S. for the next 150 years just leveraging that spent fuel,” Gitt predicted. “It’s not new technology; it’s just the will to do it.”

Making good financial cases, dealing with strong community opposition

Nuclear-powered microgrids make sense on several financial and locational levels, proponents have said. For one thing, it helps companies deliver on net-zero emission promises in a more direct way than virtual power purchase agreements that invest in remote renewable energy projects.

For another, building SMRs closer to the customer load eliminates massive expense in transmission lines and other grid infrastructure common to utility-scale renewables and more distant power plants.

“It can be done and will be done,” Walker said.

One reason it might not be done is the formidable, yet old “Nimby” argument rearing its head: Not In My Back Yard. Residential and commercial customers, understandably wary of radioactive power resources will not go gently into that good night of nuclear power acceptance.

So, projects must be rationally considered, carefully and remotely sited. They need a business case that demonstrates the promise of future revenues from subscribed customers.

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Nuclear Microgrids: Prospects for Small, Modular and Reactive Future

The road for future SMR nuclear microgrids is narrow but passable.

“It’s an emotional issue,” Orion’s Hunter said. “From a practical point you need to find a location for SMR and data centers which won’t have that problem [of stiff commercial and residential resistance].”

Emotions, in their own way, are as powerful as reactors, and inertia is hard to overcome without a new force acting on it. Education, the panel agreed, is the tool to move SMR nuclear microgrids forward.

“The misconceptions of what nuclear is are huge,” Walker said. “We have a lot of facts on our side.”

Emotion doesn’t always listen to facts in evidence. The moderator of the Data Center Frontier Trends Summit session, Ali Ruckteschler, chief procurement officer at digital infrastructure firm Equinix, pointed out that education also should be aided by regulators who truly understand what’s at stake if data center capacity growth is slowed or stalled.

“Push it on regulators to help educate people,” she said. “We need help in educating people [to understand] that without that data center you can’t work on your phone, you can’t get on that Zoom call. Is that what you want?”

Now that’s a future most people cannot comprehend.

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About the Author

Rod Walton, Managing Editor | Managing Editor

For Microgrid Knowledge editorial inquiries, please contact Managing Editor Rod Walton at [email protected].

I’ve spent the last 15 years covering the energy industry as a newspaper and trade journalist. I was an energy writer and business editor at the Tulsa World before moving to business-to-business media at PennWell Publishing, which later became Clarion Events, where I covered the electric power industry. I joined Endeavor Business Media in November 2021 to help launch EnergyTech, one of the company’s newest media brands. I joined Microgrid Knowledge in July 2023. 

I earned my Bachelors degree in journalism from the University of Oklahoma. My career stops include the Moore American, Bartlesville Examiner-Enterprise, Wagoner Tribune and Tulsa World, all in Oklahoma . I have been married to Laura for the past 33-plus years and we have four children and one adorable granddaughter. We want the energy transition to make their lives better in the future. 

Microgrid Knowledge and EnergyTech are focused on the mission critical and large-scale energy users and their sustainability and resiliency goals. These include the commercial and industrial sectors, as well as the military, universities, data centers and microgrids. The C&I sectors together account for close to 30 percent of greenhouse gas emissions in the U.S.

Many large-scale energy users such as Fortune 500 companies, and mission-critical users such as military bases, universities, healthcare facilities, public safety and data centers, shifting their energy priorities to reach net-zero carbon goals within the coming decades. These include plans for renewable energy power purchase agreements, but also on-site resiliency projects such as microgrids, combined heat and power, rooftop solar, energy storage, digitalization and building efficiency upgrades.

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