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House Data Center Power Bill Lifts Nuclear Stocks: Here's Why
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Key Takeaways
OKLO rose over 11%, SMR nearly 9% and NNE 8.5% after the House passed the Ratepayer Protection Act.
The bill would make data centers cover more costs for new generation, transmission and grid upgrades.
Advanced nuclear developers could benefit as data centers consider dedicated power and long-term supply deals.
Nuclear stocks moved sharply higher on Thursday as investors reacted to the House passage of the Ratepayer Protection Act. The bill seeks to prevent households and other existing electricity customers from carrying the infrastructure costs created by large data centers. By putting more of those costs on data center operators, the measure drew fresh attention to dedicated power sources, including small modular reactors.
Oklo Inc. (OKLO - Free Report) jumped more than 11% on Thursday, while NuScale Power (SMR - Free Report) gained nearly 9%. NANO Nuclear Energy (NNE - Free Report) advanced 8.5%. The moves followed the House vote a day earlier and showed how investors connected the proposed rules with the potential use of advanced nuclear plants to supply power-hungry data centers.
Nuclear Stocks Move Higher
Image Source: Zacks Investment Research
What Does Ratepayer Protection Act Mean for Nuclear Stocks?
The Ratepayer Protection Act aims to keep regular electricity customers from paying for the extra power infrastructure needed by large data centers. The House passed the bill 417-3. It would push data centers to cover more of the cost of new generation, transmission and grid upgrades needed to serve them.
That could help advanced nuclear developers because data centers facing higher infrastructure costs may increasingly consider dedicated power generation or long-term supply agreements. Small modular reactors could fit this need by providing large amounts of reliable, round-the-clock electricity for power-intensive data centers.
OKLO already has an agreement with Meta Platforms to develop nuclear power for its Ohio data centers. The Zacks Rank #3 (Hold) company targets initial generation in 2030, followed by a planned ramp-up to 1.2 GW by 2034.
The bill still needs Senate approval before it can become law.
Why OKLO, SMR and NNE Drew Investor Attention
OKLO, NuScale Power and NANO Nuclear are developing advanced nuclear technologies that could provide dedicated electricity to large data centers, which need a steady supply of power.
NuScale Power also has a possible path to a large commercial project. ENTRA1 Energy is in discussions with the Tennessee Valley Authority about a final power purchase agreement that could involve up to 6 GW of NuScale Power capacity.
However, Thursday's gains in OKLO, NuScale Power and NANO Nuclear Energy do not mean the House vote will quickly lead to reactor orders. The bill still needs Senate approval, and state regulators would help decide how the proposed rules are applied. Its path through the Senate remains uncertain, while several states have already introduced rules for large electricity users.
The House vote gives investors another reason to watch the connection between AI data centers and advanced nuclear power. OKLO, NuScale Power and NANO Nuclear Energy may continue to react to changes in data center power policy, but longer-term gains will depend on whether that interest leads to funding, contracts and actual reactor projects.
View the Zacks #1 Rank List
Image: Bigstock
House Data Center Power Bill Lifts Nuclear Stocks: Here's Why
Key Takeaways
Nuclear stocks moved sharply higher on Thursday as investors reacted to the House passage of the Ratepayer Protection Act. The bill seeks to prevent households and other existing electricity customers from carrying the infrastructure costs created by large data centers. By putting more of those costs on data center operators, the measure drew fresh attention to dedicated power sources, including small modular reactors.
Oklo Inc. (OKLO - Free Report) jumped more than 11% on Thursday, while NuScale Power (SMR - Free Report) gained nearly 9%. NANO Nuclear Energy (NNE - Free Report) advanced 8.5%. The moves followed the House vote a day earlier and showed how investors connected the proposed rules with the potential use of advanced nuclear plants to supply power-hungry data centers.
Nuclear Stocks Move Higher
What Does Ratepayer Protection Act Mean for Nuclear Stocks?
The Ratepayer Protection Act aims to keep regular electricity customers from paying for the extra power infrastructure needed by large data centers. The House passed the bill 417-3. It would push data centers to cover more of the cost of new generation, transmission and grid upgrades needed to serve them.
That could help advanced nuclear developers because data centers facing higher infrastructure costs may increasingly consider dedicated power generation or long-term supply agreements. Small modular reactors could fit this need by providing large amounts of reliable, round-the-clock electricity for power-intensive data centers.
OKLO already has an agreement with Meta Platforms to develop nuclear power for its Ohio data centers. The Zacks Rank #3 (Hold) company targets initial generation in 2030, followed by a planned ramp-up to 1.2 GW by 2034.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The bill still needs Senate approval before it can become law.
Why OKLO, SMR and NNE Drew Investor Attention
OKLO, NuScale Power and NANO Nuclear are developing advanced nuclear technologies that could provide dedicated electricity to large data centers, which need a steady supply of power.
NuScale Power also has a possible path to a large commercial project. ENTRA1 Energy is in discussions with the Tennessee Valley Authority about a final power purchase agreement that could involve up to 6 GW of NuScale Power capacity.
However, Thursday's gains in OKLO, NuScale Power and NANO Nuclear Energy do not mean the House vote will quickly lead to reactor orders. The bill still needs Senate approval, and state regulators would help decide how the proposed rules are applied. Its path through the Senate remains uncertain, while several states have already introduced rules for large electricity users.
The House vote gives investors another reason to watch the connection between AI data centers and advanced nuclear power. OKLO, NuScale Power and NANO Nuclear Energy may continue to react to changes in data center power policy, but longer-term gains will depend on whether that interest leads to funding, contracts and actual reactor projects.