Nuclear renaissance draws $3 billion in M&A as AI power demand surges

A surge in artificial intelligence data center construction and a renewed focus on energy security are driving the biggest wave of nuclear investment in a generation, with European M&A already doubling last year's total by early June.

The confluence of AI's insatiable electricity demand, volatile fossil fuel markets and shifting government policies has pushed nuclear power back to the center of energy planning across the US, Europe and Asia. European nuclear merger and acquisition activity reached a seven-year high in 2025 with 25 transactions totaling $1.5 billion, according to Mergermarket data compiled by law firm White & Case. In the first five months of 2026 alone, deal value has already hit $3 billion across 10 transactions — double the full-year 2025 total.

"The case for European nuclear power M&A and equity investment is as strong as it has been in a generation," Ximena Vasquez-Maignan, project finance lawyer specializing in the nuclear sector at White & Case, said. "Energy security in Europe is no longer a peripheral concern. Decarbonization requirements are tightening, and the surge in AI-driven power demand, particularly from data centers, is creating a supply gap that requires reliable, low-carbon and high-density energy, which nuclear is uniquely positioned to provide."

Global data center electricity consumption is projected to reach 945 terawatt-hours by 2030, according to industry estimates, up from roughly 460 TWh in 2022. That growth is pushing technology giants toward nuclear power purchase agreements as a way to secure round-the-clock clean electricity. Microsoft President Brad Smith said the company remains bullish on nuclear's long-term outlook, according to a Wall Street Journal report cited by OilPrice.com. The company is among the leading technology firms investing in nuclear energy to power its expanding AI data center footprint.

The investment wave extends well beyond Europe. In Canada, Cameco Corp. together with French partner Orano is acquiring the Japanese stake in the high-grade Cigar Lake mine in Saskatchewan for about CAD 116 million, increasing Cameco's ownership to 57.4%. Cigar Lake holds proven reserves of 172.4 million pounds of uranium with annual production estimated at 17.5 million to 18 million pounds. Cameco reported first-quarter adjusted net income of $203 million, double the prior-year period, on EBITDA of $509 million. The company has secured supply contracts averaging 28 million pounds annually over the next five years.

Small Modular Reactors Draw Investor Attention

Small modular reactors — factory-built units typically under 300 megawatts — are attracting particular interest from investors and technology companies. Unlike conventional nuclear plants that can take more than a decade to build and cost upward of $10 billion, SMRs promise lower upfront costs and faster deployment timelines.

The European Commission's 2026 Nuclear Illustrative Program projects that SMR installed capacity in the EU should range from 17 to 53 gigawatts by 2050, requiring between 60 and 350 units. The EC has also announced a €200 million ($233 million) guarantee fund to support private sector investment in SMR development. In the UK, the government's Great British Nuclear initiative is funding domestic SMR development, while the US Department of Energy is providing grants to advanced reactor concepts including Bill Gates' TerraPower.

Nuclear startup newcleo recently closed an $87 million funding round to expand its research and development infrastructure in Europe and enter the US market. The company confirmed in late May it would list on the Nasdaq via a special purpose acquisition company merger valued at $2.4 billion. Separately, a $475 million merger between US-listed blank check company GSR III Acquisition Corp and nuclear startup Terra Innovatum aims to support the rollout of micro-modular reactors for data centers and industrial operations.

Policy Reversals Signal Broader Shift

Governments that had turned away from nuclear power after the 2011 Fukushima disaster are now reversing course. Japan, which shut down all its reactors after the accident, is targeting the reconstruction of more than a dozen reactors by 2050. Italy is preparing to reintroduce nuclear into its energy mix through next-generation small reactors, reversing a four-decade ban. Sweden has committed to building four large-scale reactors to meet surging demand and strengthen energy independence. Belgium and Switzerland have also announced plans to reverse historic bans.

In the US, the Trump administration is pursuing a nuclear renaissance with plans to extend the lifespan of existing reactors and develop new capacity, including both large-scale plants and SMRs. The Department of Energy is exploring funding research into repurposing Cold War-era nuclear weapons material for power generation to reduce dependence on imported uranium.

China is adding seven new nuclear units this year, while the UK is streamlining regulation to accelerate nuclear projects. The UK's Sizewell C nuclear power plant secured approximately £3.25 billion ($4.4 billion) in private sector commitments, with equity investments from Canadian pension fund La Caisse, Centrica and Amber Infrastructure.

The uranium supply picture adds another layer of urgency. The industry faces an annual production shortfall of about 30 million pounds, according to industry estimates, while 70 gigawatts of new reactor capacity is under construction globally. Energy Fuels Inc., operator of the last conventional uranium mill in the US, processed nearly 1.6 million pounds of uranium in the first half of 2026 at its White Mesa Mill in Utah — already hitting the lower end of its annual guidance after just six months.

For investors, the nuclear revival creates exposure opportunities across the value chain. Cameco, trading near $101, offers exposure to established production with secured long-term contracts. Energy Fuels, at about $15, combines uranium processing with a rare earth metals strategy. Exchange-traded funds including the VanEck Uranium and Nuclear ETF (NLR), Range Nuclear Renaissance Index ETF (NUKZ) and Themes Uranium & Nuclear ETF (URAN) provide diversified access to the sector.

This article is for informational purposes only and does not constitute investment advice.