Nuclear-Gas Synergy: Oklo and RPower Unveil Phased Model to Address Data Center Power Demands

Advanced nuclear technology firm Oklo is partnering with Texas-based prime and backup solutions company RPower to roll out an innovative "phased energy model" that will combine natural gas and nuclear to offer a scalable and sustainable turnkey solution for data centers.

The companies on Jan. 17 said they signed a memorandum of understanding (MOU) to explore the model, which targets large energy users looking for an immediate and reliable source of power but remain committed to a transition to long-term decarbonization.

" Once implemented, the phased power model is expected to work in three stages," said the companies in a joint statement. At first, RPower's natural gas generators will be deployed within "approximately 24 months, depending on site conditions, to meet immediate power needs for data centers that the local utility cannot serve," they said. "Next, Oklo's advanced nuclear power solutions, the Aurora powerhouses, will be added to these sites as they become commercially available, providing emissions-free energy."

Over time, the model envisions that Aurora powerhouses "will supply the majority of the energy needed." RPower's natural gas generators will then serve backup and resilience roles, which would allow "RPower to serve as a Good Grid Citizen by providing extra power to the local grid in times of need," the companies said.

A Phased Gas-to-Nuclear Hybrid Model

The partnership is unique for the power industry, given that it brings together two niche power solutions providers to create a hybrid model that balances sustainability with the speed-to-market that data center developers are seeking. But it also marks a broader trend within the power sector seeking to capitalize on the synergies between nuclear and natural gas.

Last week, competitive power giants Constellation and Calpine announced a $16.4 billion merger that, if finalized, will combine the largest nuclear fleet in the country with the largest natural gas and geothermal fleets. Constellation CEO Joe Dominguez said Constellation views the merger as a strategic way to diversify its nuclear-heavy portfolio, expanding its presence in high-growth markets like Texas, and better position it to serve its growing commercial and indsutrial (C&I) customer base.

Oklo is developing a suite of nuclear solutions under a "full value chain" approach that involves managing smaller reactors' design, build, and operation through power purchase agreements (PPAs). It is targeting the first deployment of its f lagship offering, the 15-MWe-100 MWe Aurora powerhouse-a compact passive fast-spectrum reactor-at Idaho National Laboratory (INL) by 2027. The company has already secured a customer pipeline of 2.1 GW, including agreements with major data center operators like Prometheus, Hyperscale, and others. In December, it partnered with Switch, a Las Vegas-based data center designer, builder, and operator, to deploy 12 GW of Aurora powerhouses through 2044 in a historic deal hailed as "one of the largest corporate clean power agreements ever signed."

RPower, a company based in The Woodlands, Texas, was founded in 2021 by Jeff Starcher, former CEO of MP2 Energy (now Shell Energy). It develops prime and backup power solutions for energy-intensive sectors like data centers, oil and gas, and industrial manufacturing, and its offerings include scalable natural gas power systems that it says can be deployed in as little as 12 months for projects of up to 300 MW. The company, notably, also provides Resilience-as-a-Service (RaaS), which integrates onsite natural gas microgrids for backup power and grid support.

A Turnkey Solution for Power-Hungry Data Centers

In a recent white paper, RPower highlighted several constraints on the grid that exacerbate challenges for large-scale energy users, particularly data centers and the oil and gas industry. Concerns include insufficient transmission and distribution capacity, delays in interconnection timelines, and a growing reliance by grids on intermittent renewable resources, which, in Texas, have ushered in incentives promoting dispatchable power. RPower also pointed to volatility in wholesale markets, which has made energy planning increasingly complex for high-energy users.

A ll of these are compounded by the intense surge in power demand attributed to data centers, which require 24/7 power availability. A POWER analysis reveals a wide range of estimates. U.S. data center electricity consumption is expected to reach between 214 TWh and 675 TWh annually by 2030, a variation that reflects differing assumptions about artificial intelligence (AI)-driven workload growth, efficiency improvements, and infrastructure development. That translates to a compound annual growth rate (CAGR) for U.S. data center electricity consumption that ranges from about 5.2% to 24.0%.

More recent notable projections, including from Gartner-a much-cited research firm that advises business leaders in IT-are alarming. Gartnerpredicted in November that power shortages would restrict 40% of AI data centers by 2027. Gartner estimates the power required for data centers to run incremental AI-optimized servers could reach 500 TWh per year in 2027-2.6 times the level in 2023. "Significant power users are working with major producers to secure long-term guaranteed sources of power independent of other grid demands," said Bob Johnson , vice president analyst at Gartner. "In the meantime, the cost of power to operate data centers will increase significantly as operators use economic leverage to secure needed power. These costs will be passed on to AI/GenAI product and service providers as well." Gartner also warned that zero-carbon sustainability might be negatively affected by short-term solutions.

While power companies and tech titans from the data center industry are already collaborating to resolve mounting demand uncertainties, the landscape is growing more complex as new policies are introduced. Earlier this week, President Biden signed an executive order that seeks to fast-track the development of large-scale AI data centers and clean power facilities on federal sites. The effort, he said, prioritizes national security, economic competitiveness, and sustainable energy while ensuring costs are not passed to consumers.

According to Oklo, the emergence of a turnkey power solution that combines immediate energy deployment with long-term sustainability is a critical step forward. "This collaboration aims to ensure that data centers can access reliable energy today while building a clear and practical pathway to clean energy in the future," said Jacob DeWitte, co-founder and CEO of Oklo. "With a growing customer pipeline and a current order book of 14 GW of energy, we are thrilled to work with RPower to address both immediate and long-term energy challenges," he said.

RPower's CEO Jamie Smith echoed the timeliness of the solution. "Our relationship with Oklo represents a powerful way to bridge today's energy demands with tomorrow's clean energy solutions," he said. "We are excited to bring this phased model to market, providing valuable and timely energy solutions to our customers while advancing their sustainability goals."

-Sonal Patel is a POWER senior editor (@sonalcpatel, @POWERmagazine).

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