By Cyber Era NG Special Correspondent

With the electricity consumption of data centres, artificial intelligence (AI) and cryptocurrencies set to grow in the coming years, major tech companies are actively looking to advanced nuclear technologies such as small modular reactors (SMRs) to provide clean, reliable and flexible power. This could result in a new pathway for the commercialization of SMRs and other advanced reactors in markets where they are yet to emerge.

Data centres (which house the servers and computing equipment needed to store digital information), AI and cryptocurrencies are driving an increase in electricity demand in several regions. Together, they accounted for 2 per cent of global electricity consumption in 2022, a figure that may double by 2026, according to the International Energy Agency (IEA). The combined electricity consumption of four companies alone — Amazon, Microsoft, Google and Meta — more than doubled between 2017 and 2021 to about 72 terawatt-hours (TWh).

As they seek to meet their rising power needs, major tech companies also want to decarbonize their operations, either because legislation requires them to do so or in order to meet their own sustainability goals. To achieve this, they are looking not only to variable renewable sources of electricity such as solar and wind but also to advanced nuclear technologies such as SMRs. A similar trend can be observed in other industries seeking clean 24/7 power and heat, such as petrochemicals.

“In some regions, the pathway to advanced nuclear power deployment may very well pass through major corporate end users in the tech industrial sectors,” says Director of the IAEA’s Division of Nuclear Power Aline des Cloizeaux. “SMRs and other advanced nuclear reactors are well suited to play a key role for these companies, providing the flexible and reliable low carbon energy they need to run their operations”.

In 2022, data centres consumed an estimated 460 TWh of electricity, according to the IEA. By 2026 that figure could rise to more than 1000 TWh — over one third of the total electricity generated by the world’s nuclear power plants last year, and roughly equivalent to the electricity consumption of Japan.

In China, electricity demand from data centres is expected to double to 400 TWh by 2030 compared to 2020. In the north-east of the United States of America (USA), it is expected that data centres will increasingly drive electricity demand. The data centre market in Europe is also developing rapidly. Electricity demand from data centres in Ireland, for example, was 5.3 TWh in 2022, equivalent to 17 per cent of the country’s total electricity consumption. The IEA has stated that “at this pace, Ireland’s data centres may double their electricity consumption by 2026, and with AI applications penetrating the market at a fast rate, we forecast the sector to reach a share of 32 per cent of the country’s total electricity demand in 2026”.

Searching for solutions to these emerging needs, both Google and Microsoft have recently released reports examining how advanced nuclear, along with other clean electricity sources, can support their business and sustainability goals. “We know that wind, solar and batteries will be critical in order to decarbonize our energy consumption. But we also need firm, dispatchable, carbon free electricity technologies to cost-effectively decarbonize our electricity consumption,” says Senior Manager in Global Energy and Climate at Google Devon Swezey.

As data centres, AI and cryptocurrency companies seek sources of clean and reliable baseload power to run their operations and achieve decarbonization targets, vendors of advanced nuclear technology are taking note. “Nuclear energy is obviously the best solution to both of these problems, so the question is how to deliver it most effectively,” says Founder and Chief Executive Officer of Last Energy, a microreactor vendor based in the USA Bret Kugelmass.

Electricity end users such as tech companies need the kind of clean and firm power that advanced nuclear can provide. At the same time, they can help to overcome the barriers to deployment that stand in the way of these technologies coming to market.

In its recent policy brief on the use of advanced nuclear fission and fusion as a decarbonization tool, Microsoft cited a number of areas in which the company and other stakeholders can advocate for addressing such barriers. These included accelerating research and development, enabling programmes for testing new technologies and modelling them for integration with other low carbon sources, advancing regulatory approaches for safe and cost-effective deployment, and leveraging the power of digital technologies, including AI, in the management of new energy technologies and the grid.

Google sees a similar role for itself: “Corporate buyers can help reduce barriers to the commercialization of these technologies, including advanced nuclear,” says Swezey. “We hope to work with other clean energy buyers to scale these technologies in the coming decades and achieve 24/7 clean power, not just for Google but for everyone”.

Financing new build nuclear projects remains a challenge in several markets worldwide, given their typically high capital costs and long construction times. By contrast, SMRs and microreactors, which are smaller and factory built, are expected to require lower upfront costs and shorter build times. Like companies in the tech sector, those in other industries, such as Dow Chemicals, are looking to deploy SMRs to power their operations not only with decarbonized electricity but with high temperature heat.

The result, according to Kugelmass, may be a new path for nuclear power deployment: “Packaging nuclear in a way that’s smaller — micro scale, in fact — and modular is the key to making it affordable for private industry. Crucially, it is also the key to developing projects with purely private capital.” If we can create a model for nuclear energy that relies solely on private funding, we will be able to develop projects more efficiently and realize the benefits of nuclear at scale”.