Aalo Atomics Inc., a startup developing miniature nuclear reactors for data centers, today announced that it has raised $100 million from investors.

Valor Equity Partners led the Series B round. It was joined by more than a dozen other institutional backers including Hitachi Corp.’s venture capital arm.

Traditional nuclear reactors take billions of dollars and upwards of a decade to build. Miniature reactors such as those Aalo is developing can be deployed considerably faster. As a result, they have emerged as a major focus for the tech industry. Cloud providers and other market players are investing heavily in new energy generation infrastructure to support their data center expansion plans.

Utilities generate electricity with nuclear reactors by using the heat they produce to evaporate water. The resulting steam drives a turbine that spins a magnet inside a metal coil. This rotation causes electrons in the coil to move, which creates an electric current.

The heat produced by a nuclear reactor is not applied to the water it evaporates directly but rather via a so-called coolant. Aalo’s reactor, the Aalo-1, uses liquid sodium as its coolant. The company claims that the technology allows its reactors to produce 10 times more energy than competing systems that use other coolants.

Aalo says its sodium coolant also has other benefits. It can operate in lower pressures than competing technologies, which makes it possible to use relatively simple reactor safety mechanisms. That simplicity, in turn, reduces the risk of technical issues 

The Aalo-1 is based on a design called MARVEL that was developed at the Idaho National Laboratory. According to Aalo, it incorporates readily-available steel and turbines, which facilitates mass production. The company believes that it will eventually be possible to make upwards of 100 Aalo-1 reactors a year.

In the more immediate future, the company will use its new funding to build a pilot nuclear power plant dubbed Aalo-X. The facility is expected generate 50 megawatts of power at full capacity. It will be powered by a single turbine connected to five Aalo-1 reactors, each of which is set to produce 10 megawatts. 

“We’re planning to put an experimental data center right next to it,” Aalo co-founder and Chief Executive Officer Matt Loszak wrote in a blog post today. “This will be the first time a nuclear plant and data center are built together, and will act as a demonstration of something we’ll see a lot more of at GW scale thereafter.”

Aalo’s long-term plans revolve around the development of a new reactor with 10 times the power generation capacity of the Aalo-1. The system is expected to generate electricity at a cost of three cents per kWh, which is on par with solar farms. Similarly to the Aalo-1, it will feature a design optimized for mass production.

Photo: Aalo