By Axios- Katie Fehrenbacher - 18 December 2024

Advanced nuclear group Oklo announced that it's signed an agreement to sell 12 GW of power from planned nuclear projects to data center company Switch.

Why it matters: It's one of the largest deals for clean energy to date and highlights the insatiable need for renewable electricity to power AI data centers.

Zoom in: Oklo, which was funded early on by OpenAI CEO Sam Altman, says the deal is a "non-binding" agreement to deploy reactors through 2044.

• The Sunnyvale, Calif.-based company says it expects to reach binding agreements around individual projects.
• Oklo plans to deploy plants in the range of 50 MW to 100 MW for Switch. The company's initial reactors will be 15 MW each, far smaller than a conventional large nuclear plant.

Catch up quick: Oklo has developed a modular "fast reactor" where the nuclear fuel rods are cooled by liquid metal instead of water.

• Oklo, was founded in 2013 and went through Y-Combinator where Altman was the president. The company went public in May via a SPAC that was co-created by Altman and investor Michael Klein.
• Oklo's shares initially fell in its debut but have since recovered and later traded almost double its launch price. The company's stock was up over 11% in pre-market trading this morning on the Switch news.
• Switch is a Las Vegas-based data center company that lists major clients like Google, Nvidia and Cisco. Switch buys 100% clean energy to support its facilities.

The big picture: Advanced nuclear has emerged as a key power source for tomorrow's AI data centers. Google, Microsoft, Meta and Amazon have all shown interest.

State of play: Other advanced nuclear companies include Kairos Power, X-energy, TerraPower, and NuScale.

Yes, but: It'll take several years for the advanced nuclear companies to commercialize their reactors.

• Nuclear is highly regulated and dependent on approval by the Nuclear Regulatory Commission.
• Project designs have also notoriously gone over budget in recent years, partly thanks to inflation.

The bottom line: Big Tech's advanced nuclear deals could kick-start project deployments and could act as a linchpin for the sector.