AI Power Demand Is Fueling a Nuclear Boom. This IPO Stock Just Joined the List.

There are many nuclear energy stocks to choose from. But only a small handful are involved in the design and production of small modular reactors, or SMRs.

Research from Bank of America suggests that rising energy demand from the AI sector will spur a renaissance in nuclear energy, creating $10 trillion in opportunity. SMRs will play a key role.

“Amid surging electricity demand, driven in part by the rise in AI/data centers, nuclear energy offers a potential solution,” the bank concludes. “And new advancements in technology may now make the tipping point in sight for small modular reactors (SMRs) to reshape nuclear energy supply chains over the next decade.”

Currently, only a few SMR systems are in commercial operation worldwide. More than 80 projects, however, are currently in development. Dozens of firms are working to scale SMR infrastructure, but only a small handful are publicly traded. Even fewer are primarily focused on SMRs. The others are typically more diversified industrial conglomerates.

Oklo Inc (OKLO +6.16%) and NuScale Power (SMR +7.01%) are two of the most popular pure-play SMRs stocks on the market today. I have written about both extensively. But soon, another SMR business may conduct and IPO, allowing the public the buy shares for the first time.

This SMR stock is preparing to go public

According to reports, Westinghouse Electric — a major SMR developer backed by uranium miner Cameco Corp (CCJ +3.87%) and renewable energy investors Brookfield Renewable Partners (BEP +2.50%) — is preparing for a potential IPO.

Westinghouse Electric was first formed in 1886, but that original company has little to do with the firm’s operations today, which is solely focused on nuclear energy. Note, also, that Westinghouse Electric is completely independent from Westinghouse Air Brake Technologies Corporation (WAB +1.93%), a firm that serves the freight rail and passenger transit markets.

Image source: Getty Images

Like Oklo and NuScale Power, Westinghouse Electric’s opportunity lies in creating new, clean energy infrastructure that can generate large and reliable loads for both the AI sector and electric utilities in general.

“Electricity demand is rising, artificial intelligence has turned access to power into a strategic issue, and governments are once again treating nuclear energy as an essential part of national energy policy,” observes Forbes. “Westinghouse appears positioned to benefit. Its technology supports reactors around the world, its services are embedded across the nuclear fleet, and its AP1000 reactor has become central to several proposed new-build programs.”

Westinghouse Electric has yet to determine how many shares it will sell. It also hasn’t settled on a potential selling price, meaning we don’t yet know how valuable the company believes itself to be. There’s also no guarantee that the company will go public, though reporting seems to suggest that an IPO is the goal, subject to market conditions.

According to The Wall Street Journal, “Westinghouse and its owners last year signed an agreement with the Commerce Department that will see the U.S. government arrange financing and facilitate approvals for at least $80 billion in nuclear reactors powered by Westinghouse technology.”

NuScale Power is currently the only company approved by regulators in the U.S. to build an SMR system. Oklo and Westinghouse Electric are in the application process. Oklo has a long list of data center customers in its pipeline, while NuScale is focused on utility-scale systems, backed by $25 billion government subsidy granted to its financing partner ENTRA1.

Westinghouse Electric’s strategy will more closely mirror NuScale Power’s, especially given its $80 billion in government backing. But more details will be revealed once a public IPO prospectus is filed.