Artificial intelligence (AI) as the future light of all mankind, has a very high demand for computing power and electrical stability, often described as an 'electricity-eating monster'.

Previously, the CEO of the AI chip leader$NVIDIA (NVDA.US)$Huang Renxun publicly emphasized the issue of energy consumption: 'We cannot only think about computing power. If we only consider computers, we would need to burn the energy of 14 planets.'

According to reports from foreign research institutions, ChatGPT needs to respond to approximately 0.2 billion requests per day, consuming over 0.5 million kilowatt-hours of electricity, equivalent to the electricity consumption of 0.017 million American households. Furthermore, the International Energy Agency (IEA) has reported that if artificial intelligence is fully integrated, the electricity consumption for platforms like Google Search could increase tenfold. Faced with such substantial power demands, tech giants have unanimously turned to the same solution - artificial sun: nuclear fusion.

In this context, the technology giant$Microsoft (MSFT.US)$has decided to embrace nuclear energy, signing a 20-year power purchase agreement with Constellation Energy, a U.S. company.$Constellation Energy (CEG.US)$The stock price soared by more than 20% on the day, leading nuclear energy and uranium-related stocks to rise collectively.

According to Market Watch and other foreign media reports, on September 20, the US Constellation Energy Company announced that it has signed a 20-year power purchase agreement with Microsoft. Starting from 2028, the Three Mile Island nuclear power plant in Middletown, Pennsylvania will restart operations, generating over 800MW of electricity, which will be fully purchased and used by Microsoft to ensure the power supply for AI data centers.

Constellation Energy Company plans to restart the Unit 1 reactor of the Three Mile Island nuclear power plant, which ceased operation in 2019 due to cost challenges against renewable energy. As nuclear power generation does not emit greenhouse gases, it aligns with the international net-zero carbon reduction trend. Additionally, nuclear energy is not as susceptible to weather conditions compared to solar or wind power generation, making it a popular option for power supply once again.

Are technology giants embracing nuclear power?

It is noteworthy that technology giants have set self-sufficient electricity goals, indicating that the power consumption of company data centers and other operations will be entirely sourced from their own invested new carbon-free energy. Nuclear energy accounts for a significant proportion of this.

Market analysts believe that purchasing nuclear energy will help Microsoft achieve its goal of having all its vast global data center network powered by clean energy by 2025. Bobby Hollis, Microsoft's Energy Vice President, stated in a media interview that this nuclear energy will be used for data center expansions in regions like Chicago, Virginia, Pennsylvania, and Ohio.

Hollis mentioned that data centers are an ideal customer for nuclear power, as wind and solar energy outputs fluctuate, while nuclear power plants typically run continuously, requiring a customer that can take all the electricity. This makes technology companies with cloud computing an ideal choice.

Earlier this year, microsoft stated that its carbon neutrality goals are at risk due to the surge in cloud computing demand driven by ai. In the fiscal year ending June 30, the company's capital expenditure exceeded 50 billion dollars, mainly for expanding datacenters, with plans to exceed this amount in the current fiscal year. Additionally, as the technology industry accelerates the development of ai, it was previously anticipated that the power demand of datacenters in the coming decades would surge, potentially adding pressure to the power grid.

In addition, in March of this year,$Amazon (AMZN.US)$cloud computing service AWS acquired Cumulus data center park for 0.65 billion dollars,$Talen Energy (TLN.US)$which is connected to the Susquehanna nuclear power station. As part of the deal, Talen Energy signed a ten-year power purchase agreement with amazon to supply power through the Susquehanna nuclear power station.

$Oracle (ORCL.US)$Chairman Ellison recently announced the design of a data center that will require over 1 gigawatt of power, to be powered by three small nuclear reactors, each with a power capacity of no more than 300 megawatts, with the potential to deploy carbon-free energy more quickly. A nuclear energy startup$Oklo Inc (OKLO.US)$Expected to launch its first reactor before 2027.

Goldman Sachs predicts that by 2030, the power consumption of data centers will account for 8% of the total electricity demand in the USA, compared to the current 3%.

On the other hand, at the 28th United Nations Climate Conference, 22 countries made an unexpected statement: by 2050, global nuclear energy installation will reach three times the current level, directly driving the demand for uranium. The USA has pledged to allocate up to 0.5 billion US dollars under the 'Inflation Reduction Act' to establish uranium supply for advanced nuclear reactors, thereby avoiding geopolitical risks such as the Russia-Ukraine conflict.

How to seize the rising opportunities of nuclear power, uranium mining stocks?

It can be foreseen that, driven by the AI wave and the demand for clean energy, the construction quantity and speed of nuclear power units in major global economies will significantly accelerate, and the share of nuclear power in the grid will rapidly increase.

Therefore, investors can not only bet on stocks, but also buy related stock options. Looking at the options chain, the star nuclear power stocks of this surge.$Constellation Energy (CEG.US)$The call option with an expiration date of October 18 and a strike price of $270 earned more than 61 times.

At the same time, due to the significant increase in nuclear power demand, it will also drive the demand for upstream raw material uranium mines. In fact, in 2023-2024, the price of uranium has already led the way in the substantial increase of energy-related commodities.

Therefore, investors can also invest in related ETFs to follow the overall upward trend of the industry, such as$VanEck Uranium and Nuclear ETF (NLR.US)$Rising nearly 5% on the previous trading day.$Global X Uranium ETF (URA.US)$rose more than 4%.

How to find the desired ETF? The ETF section can help you! Mooers can click on Market >ETF> Choose from a variety of ETFs in different markets.

At the same time, you can also access the detailed quote page and click on 'Fund' to view the introduction and investment components.

Editor/ping