Big Tech goes nuclear 

Amazon and Google have both hopped on the nuclear power bandwagon, striking deals with companies to supply new AI data centres with energy. In the first half of 2024, newly announced AI data centres amounted to nearly 24 gigawatts of capacity – more than triple that of the same period last year.

The recent spike in demand for nuclear energy by big corporations has come unexpectedly – especially in the context of the world’s focus on clean energy and the transition towards a more sustainable future.

This sudden demand begs the question of why these large companies are so dead set on nuclear energy, rather than other low emission sources.

There are obvious concerns surrounding nuclear power – it is a challenge to mass produce and volatile in its nature. Accidents such as Chernobyl, in 1986, making the area uninhabitable for the next 20,000 years, as well as Fukushima in 2011, are still fresh in people’s minds. These events will have no doubt crossed the minds of tech giants when deciding to invest in nuclear power. There must hence be ulterior motives other than to facilitate the additional power demand.

A chicken-egg sized amount of uranium produces as much energy as 88 tonnes of coal

Some reactor companies have claimed that renewables and batteries are not cost-effective, and are too ‘conditional’ to provide stable energy. This makes sense when analysing the requirements for renewable energy production: solar power requires constant sunlight thus cannot operate during the night, wind power requires constant wind thus cannot operate constantly, and biofuels are not efficient enough.

Therefore, nuclear has been chosen to due to its incredible production capacity. According to the International Atomic Energy Agency, a chicken-egg sized amount of uranium produces as much energy as 88 tonnes of coal. As fossil fuels are due to deplete around 2050–2060, the world must move away from them, and chose more reliable, flexible, and low emissions options. Nuclear is this option apparently.

Amazon and Google have opted to invest in small modular reactors – which can be factory assembled before transportation, driving down costs – as opposed to large conventional reactors. However, concerns have arisen in the past about the rate of production of these smaller reactors. Despite the industry receiving billions of dollars from the US government, the deployment of these reactors is likely to be delayed and incur greater operational costs than first predicted.

80% of the announced capacity is yet to enter the developmental phase

The inevitable transition to renewable, carbon-free energy is not without trials and tribulations. Similar to how solar panels and wind turbines were seen as the future of energy once in the past, and are now established, experimenting with fresh nuclear technology is tantalising but riskier.

The race to commence production of small reactors is still pending. 80% of the announced capacity is yet to enter the developmental phase, concerning Google, Microsoft, and Amazons’ 5.8GW power purchases from AES – a global renewable energy developer.

Besides the standard safety issues, as expected when dealing with nuclear power, the implementation of these small modular reactors may have some geopolitical side effects. Both Russia and China have deployed a handful of small reactors; the US channelling billions of dollars of investment into them may spark competition as to who can cement themselves as the global leader.

As AI becomes more integrated in the world and comes to assist millions of people daily, tech giants have recognised its transformative potential for change, and are willing to do whatever it takes to accelerate development. Embracing nuclear power is a difficult decision to make given its history. However, its efficiency and carbon neutrality make it the only suitable form of energy to facilitate this expansion.

Companies as well as governments must be prepared to adapt to unforeseen circumstances and the added financial obligations nuclear power comes with. It will nonetheless be interesting to witness how this plays out in the coming years.