Small Modular Reactors: Why Big Tech is Betting on Nuclear to Power the AI Era

mwilliams831
Aug 20, 2025
5 min read

Updated: Jan 13

Artificial intelligence is advancing at a staggering pace—reshaping industries, economies, and how society functions. But behind every breakthrough lies a question few outside the energy sector ask:

How will we power it all?

Training and operating large-scale AI systems requires immense computing power. A single AI query can consume multiple times the electricity of a traditional search. Multiply that by billions of daily interactions, and the strain on global power systems becomes clear.

As a result, data centers now consume electricity at the scale of entire cities—and demand is accelerating rapidly. The U.S. Department of Energy projects that global electricity needs could rise by as much as 75% by 2050, with AI-driven infrastructure emerging as one of the primary drivers.

Wind and solar will continue to play an essential role in the energy transition. But their intermittency presents challenges for mission-critical facilities that must operate continuously. That reality is pushing nuclear energy—and particularly Small Modular Reactors (SMRs)—back into the spotlight.

The New Energy Equation

For decades, U.S. electricity demand grew incrementally. Today, three powerful forces are converging:

AI and data centers scaling at unprecedented speed
Electrification of industry and transportation adding new baseload demand
Reshoring of manufacturing bringing energy-intensive production back onshore

Together, these forces are rewriting the energy equation. The future economy isn’t just digital—it is energy-intensive, requiring solutions that are both scalable and carbon-free.

Nuclear power offers a unique combination: steady output, zero direct emissions, and the ability to scale alongside long-term demand.

Amazon Leads the Charge

Among Big Tech companies, Amazon has emerged as one of the most aggressive proponents of nuclear energy.

In October 2024, the company announced a series of nuclear-related initiatives across Virginia and Washington State, including:

A $500 million investment in X-energy, anchoring development of SMRs capable of generating more than 5 GW of clean power by 2039
A partnership with Energy Northwest to launch up to 960 MW of modular nuclear capacity
An agreement with Dominion Energy to explore SMR opportunities in Virginia
A long-term power purchase agreement with Talen Energy, securing nearly 2 GW of nuclear-generated electricity through 2042

These efforts support Amazon’s broader $52 billion data center expansion across three U.S. states—designed to meet surging AWS demand while advancing its commitment to net-zero operations by 2040.

As AWS CEO Matt Garman noted:

“Nuclear is a great option for how we scale the world’s energy needs. SMRs are the most promising new technology to do that.”

Microsoft, Google, and Meta Follow Suit

Amazon may be the most visible, but it is far from alone.

Microsoft is working with Constellation Energy to explore redevelopment opportunities at the Three Mile Island site, while Bill Gates’ TerraPower advances next-generation reactors in Wyoming.
Google has partnered with Kairos Power in Tennessee to explore advanced nuclear designs.
Meta is evaluating options to secure up to 4 GW of nuclear power to support its global infrastructure footprint.

For these companies, nuclear energy is no longer experimental—it is strategic. The AI economy cannot scale without firm, reliable power, and SMRs offer a viable pathway.

Why SMRs Matter

Small Modular Reactors differ fundamentally from traditional nuclear plants:

Compact & Flexible – At roughly 300 MW per unit, SMRs are smaller and easier to site near large energy consumers.
Faster Deployment Potential – Factory-built modules reduce construction risk and timeline uncertainty.
Scalable Design – Capacity can expand incrementally, mirroring the modular growth of data centers.
24/7 Reliability – Unlike intermittent renewables, SMRs deliver continuous baseload power critical for AI workloads.

While the U.S. does not yet have an operational SMR, early units are expected to come online in the early 2030s. Many view SMRs as the most realistic path to balancing emissions reduction with surging energy demand.

Challenges on the Road Ahead

Despite strong momentum, challenges remain:

Regulatory complexity – SMR licensing and approvals are still evolving.
Capital intensity – Nuclear projects require disciplined financial structuring.
Public perception – Safety and waste concerns continue to shape community engagement.

Yet the trajectory is clear. As Doug Vine of the Center for Climate and Energy Solutions observed, while costs remain a “moving target,” the urgency of clean, firm power is accelerating investment and innovation across the sector.

Implications for Development & Infrastructure

The return of nuclear power—especially in modular form—has implications far beyond energy generation:

Data center siting will increasingly depend on access to reliable, carbon-free baseload power
Industrial growth will cluster around energy-secure campuses
Community planning will need to integrate nuclear-enabled development into land use, infrastructure, and permitting frameworks

Success in this environment will depend on early-stage coordination, long before equipment is deployed or construction begins.

Where IHD Fits

At Interface Holdings and Development Firm (IHD), we focus on the upstream development, coordination, and capital alignment required to position complex infrastructure projects for execution. As a junior developer and integrator, IHD works alongside owners, capital providers, utilities, and specialized technical partners to help advance AI campuses, industrial hubs, and energy-intensive developments.

By addressing land strategy, entitlement pathways, power planning, procurement coordination, and financing structures early, IHD helps reduce risk, compress timelines, and support long-term infrastructure resilience—without self-performing licensed engineering or construction services.

The Road Ahead

As one executive put it, “Abundant intelligence is built on abundant energy.”

Small Modular Reactors mark a turning point in aligning energy innovation with the digital economy. Challenges remain, but the direction is clear: nuclear power is being reframed as a foundational component of AI-driven growth.

For Big Tech, it’s about continuity.For communities and developers, it’s opportunity.For the future of infrastructure, it’s transformative.

At IHD, we help leaders navigate these transitions—ensuring today’s projects are developed to meet the energy demands and opportunities of tomorrow.