What Are Small Modular Reactors?

Small modular reactors are nuclear reactors with power output typically between 50 and 300 megawatts, significantly smaller than conventional nuclear plants that generate 1,000 megawatts or more. The modular aspect refers to their design philosophy: major components are manufactured in factories and assembled on-site, rather than being custom-built for each installation.

SMRs use the same fundamental physics as conventional reactors. The difference is in scale, engineering approach, and safety design. Most SMR designs incorporate passive safety systems that rely on natural physical processes, such as gravity and natural convection, rather than active mechanical systems. This means the reactor can safely shut itself down without operator intervention or external power.

Why Data Centers Are Interested in Nuclear

Data centers need large amounts of reliable, around-the-clock electricity. A hyperscale data center might require 100 megawatts to over 1 gigawatt of continuous power. Solar and wind cannot provide this without massive battery storage. Natural gas produces carbon emissions that conflict with corporate sustainability goals. Nuclear offers the rare combination of carbon-free generation, high reliability, and compact footprint.

The interest from technology companies is concrete. Microsoft signed an agreement to purchase power from the Three Mile Island nuclear plant. Google announced partnerships with nuclear developers. Amazon acquired a data center campus adjacent to a nuclear plant in Pennsylvania. Oracle’s chairman has discussed plans for data centers powered by small modular reactors.

Leading SMR Designs and Developers

Several companies are racing to bring SMRs to market. NuScale Power received the first design certification from the US Nuclear Regulatory Commission for an SMR. Their design uses light water reactor technology scaled down to 77 megawatt modules. However, their first commercial project was cancelled in 2023 due to cost escalation.

Other developers include X-energy with a high-temperature gas-cooled reactor, Kairos Power building a demonstration reactor using molten fluoride salt coolant, and TerraPower developing a sodium-cooled fast reactor paired with molten salt energy storage. Each design has different strengths in safety, operating temperature, fuel type, and intended application.

Timeline and Regulatory Path

The timeline for SMR deployment is measured in years, not months. NRC licensing typically requires five to seven years for a new reactor design. Construction adds several more years. The first commercial SMR installations in the United States are unlikely to be operational before the late 2020s at the earliest, with significant scale arriving in the early to mid-2030s.

This timeline presents a mismatch with data center demand, which is growing now. Companies investing in nuclear power agreements today are betting on their energy needs a decade from now, when AI computing demand could be dramatically higher than current levels.

Challenges: Cost, Waste, and Public Perception

Cost remains the most significant challenge. The two most recent conventional nuclear units built in the US, at Plant Vogtle in Georgia, came in years late and billions over budget. SMR proponents argue that factory fabrication will avoid these problems, but until multiple SMRs are actually built, the cost projections remain unproven.

Nuclear waste management is a persistent issue. The United States does not have a permanent repository for high-level nuclear waste. Public perception remains mixed, shaped by the legacies of Three Mile Island, Chernobyl, and Fukushima, even though modern designs have fundamentally different safety characteristics.

The Role of Nuclear in the Future Energy Mix

Nuclear energy is experiencing a resurgence driven by decarbonization and growing electricity demand. Existing plants are having licenses extended. Previously retired plants are being considered for restart. And new SMR development is attracting billions in investment.

For data centers, SMRs represent a potential long-term solution to the tension between massive power demand, carbon-free commitments, and grid constraints. A behind-the-meter SMR could provide dedicated, reliable, zero-carbon power without depending on the interconnection queue. Whether this vision becomes reality depends on whether developers can deliver on cost, schedule, and performance promises. The next five years will be decisive.