Why Big Tech is turning to nuclear to power its energy-intensive AI ambitions
The OpenAI app icon displayed along with other AI applications on a smartphone.
Jonathan Raa | Nurphoto via Getty Images
Technology giants are turning to nuclear energy to power the energy-intensive data centers needed to train and run the massive artificial intelligence models behind today’s generative AI applications.
Microsoft and Google are among the firms agreeing deals to purchase nuclear power from certain suppliers in the U.S. to bring additional energy capacity online for its data centers.
This week, Google said it would purchase power from Kairos Power, a developer of small modular reactors, to help “deliver on the progress of AI.”
“The grid needs these kinds of clean, reliable sources of energy that can support the build out of these technologies,” Michael Terrell, senior director for energy and climate at Google, said on a call with reporters Monday.
“We feel like nuclear can play an important role in helping to meet our demand, and helping meet our demand cleanly, in a way that’s more around the clock.”
Google said its first nuclear reactor from Kairos Power would be online by 2030, with more reactors going live through 2035.
The tech giant isn’t the only firm looking to nuclear power to realize its AI ambitions. Last month, Microsoft signed a deal with U.S. energy firm Constellation to resurrect a defunct reactor at the Three Mile Island nuclear power plant in Pennsylvania, whose reactor has been dormant for five years.
The Three Mile Island plant was the location of the most serious nuclear meltdown and radiation leak in U.S. history in March 1979, when the loss of water coolant through a faulty valve caused a reactor to overheat.
Why they’re turning to nuclear
Tech companies are under pressure to find energy sources to power data centers — a key piece of infrastructure behind modern-day cloud computing and AI applications.
Many developers rent out servers equipped with GPUs (graphics processing units), which would typically be too expensive to own outright, from so-called cloud “hyperscalers” — such as Amazon, Microsoft and Google.
These tech giants have benefited from a surge of interest in generative AI applications such as OpenAI’s ChatGPT. But that increase in demand has also led to an unintended effect: correspondingly large spikes in the amount of energy required.
Global electricity consumption from data centers, artificial intelligence and the cryptocurrency sector is expected to double from an estimated 460 terawatt-hours (TWh) in 2022 to more than 1,000 TWh in 2026, according to a research report from the International Energy Agency.
Researchers at the University of California, Riverside, published a study in April last year that found ChatGPT consumes 500 milliliters of water for every 10 to 50 prompts, depending on when and where the AI model is deployed. That equates to roughly the amount of water in a standard 16-ounce bottle.
As of August, there were more than 200 million people submitting questions on OpenAI’s popular chatbot ChatGPT every week, according to OpenAI. That’s double the 100 million weekly active users OpenAI reported last November.
Environmental opposition
Nuclear energy isn’t without its controversy. Many climate activists oppose such supplies, citing their hazardous environmental and safety risks, and the fact that they do not offer a genuine source of renewable power.
“Nuclear power is incredibly expensive, hazardous and slow to build,” the climate charity Greenpeace says on its website.
“It is often referred to as ‘clean’ energy because it doesn’t produce carbon dioxide or other greenhouse gases when electricity is generated but the reality is that it isn’t a plausible alternative to renewable energy sources.”
Proponents of nuclear energy, on the other hand, say that it offers a nearly carbon-free form of electricity and is more reliable than renewable sources like solar and wind.
“If it is built and securitized in the right way, I do think nuclear is the future,” Rosanne Kincaid-Smith, chief operating officer of Northern Data Group, a global data center provider, told CNBC at a tech conference in London last week.
“People are scared of nuclear because of the disasters we’ve had in the past. But what’s coming, I just don’t see traditional grids being the sustainable power that’s ongoing in the development of AI,” Kincaid-Smith added.
While Northern Data Group isn’t using nuclear energy — nor is it actively exploring plans to use nuclear as a power source for its AI data centers — the firm does want to “contribute to that conversation because it’s important for the wider ecosystem, the wider economy,” Kincaid-Smith told CNBC.
– CNBC’s Pippa Stevens contributed to this report
Wind energy powered 20% of all electricity consumed in Europe (19% in the EU) in 2024, and the EU has set a goal to grow this share to 34% by 2030 and more than 50% by 2050.
To stay on track, the EU needs to install 30 GW of new wind farms annually, but it only managed 13 GW in 2024 – 11.4 GW onshore and 1.4 GW offshore. This is what’s holding the EU back from achieving its wind growth goals.
Three big problems holding Europe’s wind power back
Europe’s wind power growth is stalling for three key reasons:
Permitting delays. Many governments haven’t implemented the EU’s new permitting rules, making it harder for projects to move forward.
Grid connection bottlenecks. Over 500 GW(!) of potential wind capacity is stuck in grid connection queues.
Slow electrification. Europe’s economy isn’t electrifying fast enough to drive demand for more renewable energy.
Brussels-based trade association WindEurope CEO Giles Dickson summed it up: “The EU must urgently tackle all three problems. More wind means cheaper power, which means increased competitiveness.”
Permitting: Germany sets the standard
Permitting remains a massive roadblock, despite new EU rules aimed at streamlining the process. In fact, the situation worsened in 2024 in many countries. The bright spot? Germany. By embracing the EU’s permitting rules — with measures like binding deadlines and treating wind energy as a public interest priority — Germany approved a record 15 GW of new onshore wind in 2024. That’s seven times more than five years ago.
If other governments follow Germany’s lead, Europe could unlock the full potential of wind energy and bolster energy security.
Grid connections: a growing crisis
Access to the electricity grid is now the biggest obstacle to deploying wind energy. And it’s not just about long queues — Europe’s grid infrastructure isn’t expanding fast enough to keep up with demand. A glaring example is Germany’s 900-megawatt (MW) Borkum Riffgrund 3 offshore wind farm. The turbines are ready to go, but the grid connection won’t be in place until 2026.
This issue isn’t isolated. Governments need to accelerate grid expansion if they’re serious about meeting renewable energy targets.
Electrification: falling behind
Wind energy’s growth is also tied to how quickly Europe electrifies its economy. Right now, electricity accounts for just 23% of the EU’s total energy consumption. That needs to jump to 61% by 2050 to align with climate goals. However, electrification efforts in key sectors like transportation, heating, and industry are moving too slowly.
European Commission president Ursula von der Leyen has tasked Energy Commissioner Dan Jørgensen with crafting an Electrification Action Plan. That can’t come soon enough.
More wind farms awarded, but challenges persist
On a positive note, governments across Europe awarded a record 37 GW of new wind capacity (29 GW in the EU) in 2024. But without faster permitting, better grid connections, and increased electrification, these awards won’t translate into the clean energy-producing wind farms Europe desperately needs.
Investments and corporate interest
Investments in wind energy totaled €31 billion in 2024, financing 19 GW of new capacity. While onshore wind investments remained strong at €24 billion, offshore wind funding saw a dip. Final investment decisions for offshore projects remain challenging due to slow permitting and grid delays.
Corporate consumers continue to show strong interest in wind energy. Half of all electricity contracted under Power Purchase Agreements (PPAs) in 2024 was wind. Dedicated wind PPAs were 4 GW out of a total of 12 GW of renewable PPAs.
Read more: Renewables could meet almost half of global electricity demand by 2030 – IEA
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The Chinese EV leader is launching a new flagship electric sedan. BYD’s new Han L EV leaked in China on Friday, revealing a potential Tesla Model S Plaid challenger.
What we know about the BYD Han L EV so far
We knew it was coming soon after BYD teased the Han L on social media a few days ago. Now, we are learning more about what to expect.
BYD’s new electric sedan appeared in China’s latest Ministry of Industry and Information Tech (MIIT) filing, a catalog of new vehicles that will soon be sold.
The filing revealed four versions, including two EV and two PHEV models. The Han L EV will be available in single- and dual-motor configurations. With a peak power of 580 kW (777 hp), the single-motor model packs more power than expected.
BYD’s dual-motor Han L gains an additional 230 kW (308 hp) front-mounted motor. As CnEVPost pointed out, the vehicle’s back has a “2.7S” badge, which suggests a 0 to 100 km/h (0 to 62 mph) sprint time of just 2.7 seconds.
To put that into perspective, the Tesla Model S Plaid can accelerate from 0 to 100 km in 2.1 seconds. In China, the Model S Plaid starts at RBM 814,900, or over $110,000. Speaking of Tesla, the EV leader just unveiled its highly anticipated Model Y “Juniper” refresh in China on Thursday. It starts at RMB 263,500 ($36,000).
BYD already sells the Han EV in China, starting at around RMB 200,000. However, the single front motor, with a peak power of 180 kW, is much less potent than the “L” model. The Han EV can accelerate from 0 to 100 km/h in 7.9 seconds.
At 5,050 mm long, 1,960 mm wide, and 1,505 mm tall with a wheelbase of 2,970 mm, BYD’s new Han L is roughly the size of the Model Y (4,970 mm long, 1,964 mm wide, 1,445 mm tall, wheelbase of 2,960 mm).
Other than that it will use a lithium iron phosphate (LFP) pack from BYD’s FinDreams unit, no other battery specs were revealed. Check back soon for the full rundown.
Source: CnEVPost, China MIIT
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