Nuclear energy has returned to the forefront of investment discussions as its prospects for addressing clean, reliable power gains momentum. The rising interest is reflected in the Global X Uranium ETF surging 65% over the last year, alongside considerable but volatile rallying moves by newer companies such as Oklo, whose shares have risen 278%, and Nano Nuclear with a 21% increase to date.
Despite enthusiasm surrounding nuclear ventures, caution is warranted with startups like Oklo and Nano Nuclear. Both entities are developing breakthrough nuclear technologies but face extended paths before achieving commercial output or revenue generation.
Conversely, Constellation Energy, with a robust portfolio and proven operations, emerges as a compelling nuclear sector investment for those seeking present-day revenue and growth supported by substantial asset ownership and contracts. Here, the characteristics and prospects of each company are considered.
Innovative Nuclear Startups Pushing the Boundaries
Oklo and Nano Nuclear are pioneering concepts intended to reshape nuclear energy deployment. Oklo focuses on advanced fission reactors called Aurora powerhouses. These relatively compact reactors are designed to recycle nuclear fuel efficiently, targeting power demands from data centers, industrial operations, and smaller communities.
In parallel, Nano Nuclear specializes in microreactors that are even smaller and portable, with industrial-scale outputs between one and two megawatts. Such reactors are envisioned to energize remote locations, including mining sites, islands, and disaster zones, while also being suited for military and potentially space-related use cases.
While promising, the development timelines for these technologies remain extensive. Oklo’s inaugural Aurora reactor is projected to commence operation around 2027 or 2028. Nano Nuclear is still in the early research phase for its microreactor technology, with commercial deployment estimated no earlier than the 2030s.
Besides technological hurdles, Nano Nuclear is also working to establish a vital supply chain encompassing uranium mining, high-assay low-enriched uranium (HALEU) production, and nuclear fuel transportation, adding layers of complexity and potential delays in scaling operations.
From an investment standpoint, both companies are presently pre-revenue with no available commercial products. Their financial viability heavily depends on securing funding, navigating development challenges, and achieving regulatory approvals in the years ahead, reflecting inherent risks.
Constellation Energy: Established Nuclear Leadership
In contrast to the startups, Constellation Energy operates at scale today, managing 14 nuclear generating stations across the United States with a total capacity near 22 gigawatts. It stands as the nation's largest nuclear plant operator and a significant renewable energy producer.
The company’s assets are strategically located across key energy markets, including the western part of the PJM region—a critical U.S. transmission system servicing over 65 million people across 13 states plus Washington D.C.—and the MISO region spanning the Midwest and Plains areas, along with portions of the southern U.S.
Operational excellence is demonstrated by Constellation’s average nuclear capacity factor of 94.6% over the past three years, outperforming the industry average by approximately four percentage points since 2013. This efficiency translates to higher revenue per reactor and greater reliability during peak demand periods.
Significant contracts underscore Constellation’s market position, including long-term power purchase agreements (PPAs) such as a 20-year deal with Microsoft and a similar arrangement with Meta Platforms, guaranteeing off-take for facilities like the Clinton Clean Energy Center in Illinois. Additionally, it recently secured $1 billion in combined contracts via the U.S. General Services Administration to supply power across more than a dozen federal agencies.
Investment Considerations Amid Different Risk Profiles
The dichotomy between the startups and Constellation Energy highlights distinct investment profiles. Oklo and Nano Nuclear embody innovative, potentially transformative technologies but carry substantial execution risks and extended horizons before contributing revenues. Their financial success hinges on technological breakthroughs, regulatory navigation, and establishing full supply chains.
Conversely, Constellation offers investment exposure to nuclear energy built on established infrastructure, ongoing cash flows, and secured long-term contracts. Its demonstrated operational efficiency and asset scale suggest a capacity to meet growing energy demand in the near term.
Investors evaluating nuclear sector exposure must weigh the allure of future-oriented startups against the more immediate, stable returns of a sector leader with recognized performance and contracts in place.