On a recent spring afternoon, Aalo Atomics' cavernous manufacturing space in Southwest Austin was quiet. Staffers had shut down the machines on the shop floor as they prepared to unveil a technology the CEO believes will change the future of electricity.
“Right now we’re coming up to the reactor vessel,” Matt Loszak said, pulling aside a big black curtain to reveal a cylindrical shining steel tank.
The vessel, displayed under a futuristic blue light, was 20 feet tall, about the size of a shipping container. Next to it, Loszak gestured to more metal components, the guts of the reactor.
“This is where the nuclear fuel would go,” he said.
To be clear, there was none of that fuel present. These small modular nuclear reactors — Loszak called them microreactors — are still in their testing phase. But they are a key part of the built-to-order nuclear power plants Aalo wants to mass produce to sell to AI data centers.
And it wasn’t just the reactors Loszak was showing off; it was the manufacturing facility itself.
“This is, essentially, the world's first factory that can produce nuclear power plants kind of wholesale,” he said. “So, not just the reactor, but also the whole plant.”
That is, if things go according to plan.
Aalo is one of a handful of nuclear companies now operating in Texas hoping to get in on the ground floor of a new atomic age.
An answer to the power crunch
Texas consumes more electricity than any other state by a wide margin and ranks sixth in energy consumption per capita.
It also is the only state in the lower 48 that operates its own power grid. That grid, managed by the Electric Reliability Council of Texas or ERCOT, is known for its ease-of-entry for new power generators.
But that’s not the only reason new nuclear firms have been attracted to the state.
“Texas is just an energy leader,” Loszak said, citing its deep pool of industry talent, from the oil, gas and renewable sectors and new state programs to foster and finance nuclear technology.
Those programs took shape after Gov. Greg Abbott kicked off this year’s legislative session with calls for a new “nuclear renaissance” to jump-start the industry.
A forecast from ERCOT had found that Texas energy demand could almost double by 2030, in large part because of the influx in AI data centers.
Analysts warned that, if the forecast was even close to accurate, it could pose a threat to a state power grid that has already delivered one major blackout and several close calls this decade.
Nuclear power currently accounts for only 10% of the energy consumed in the state, generated at the Comanche Peak and South Texas Project nuclear power plants.
Abbott and others saw more nuclear energy as the answer to the power crunch.
Lawmakers responded to the governor’s urging by passing the Texas Nuclear Deployment Act.
The law created a state office to promote the industry — and set aside $350 million for public financing of nuclear projects.
Private companies are already planning to build small modular nuclear reactors outside Dallas and along the Gulf Coast.
Research centers, some of which received their own dedicated funding, are also hoping to build test reactors to find safer ways to produce nuclear power at Texas A&M and Abilene Christian University.
“Nuclear power provides the most reliable and energy dense electricity available to mankind,” the Texas Nuclear Deployment Act’s author, Rep. Cody Harris, R-Palestine, said on the House floor. “Investment in nuclear generation will ... create tens of thousands of high-wage jobs for Texans up and down the nuclear value chain from uranium mining and enrichment to technology development and advanced manufacturing.”
Harris argued a nuclear renaissance starting in Texas will soon spread beyond the state’s borders, answering rising energy demand and maintaining grid reliability.
Not everyone is as enthusiastic.
‘One accident will wipe us out’
Diane Wilson is a fourth-generation shrimper in the Gulf Coast town of Seadrift. She has spent decades trying to stop local petrochemical companies from contaminating the coast and degrading the fishery.
Wilson won a major victory in 2019, when the plastics manufacturer Formosa agreed to a landmark settlement after she showed it had been illegally discharging plastic pellets into Matagorda Bay for years.
She said the industry’s environmental record leaves her deeply concerned about plans to build a small modular reactor to power a plastics factory in Seadrift.
“We aim to stop this project in its tracks,” Wilson said of the nuclear plant, which is still years away from construction.
"I’m not afraid of the technology. I’m afraid of the cost of the technology."Dennis Walmsted, Institute for Energy Economics and Financial Analysis
“Nobody has bothered to talk to people who might have some concerns, like the fisherman,” she said. “We are a fishing community. One accident will wipe us out!”
Similar projects are likely to attract resistance as well from people concerned about the risks posed by reactor accidents and radioactive waste, complicating plans for a new nuclear age in Texas and elsewhere.
Aside from environmental concerns, some doubt the small reactors touted by the industry are ready to answer the country’s looming power crunch.
“I’m not afraid of the technology. I’m afraid of the cost of the technology,” said Dennis Walmsted, an analyst with the Institute for Energy Economics and Financial Analysis.
Nuclear power plants are expensive to build. They are also notorious for cost overruns and construction delays. While those are problems that small modular reactors are supposed to solve, Walmstead points out that those have never actually been deployed commercially in the U.S.
“Until you build one or five, you don’t know how long it’s gonna take,” Walmstead said. “Until you build one or five, you really have no idea what it’s gonna cost, because you haven’t built one!”
Increased demand from AI data centers
But back at the Aalo Atomics facility in Austin, Loszak is confident his company can build one and then many, many more.
He said deep-pocketed tech companies with a “higher willingness to pay upfront” have changed the calculus around what's possible in the world of advanced nuclear technology.
“The amazingly fortunate thing is that right now we have that type of demand — for the first time, really — since the creation of nuclear energy,” Loszak said. “Which is from these AI data centers.”
While Aalo plans to start building a working test reactor in the next 12 months, actually delivering electricity is still years away. The company is betting that demand will still be there when the reactors are ready.
