SMR Nuclear Reactor at night

IPO CLUB SMR Investment Analysis

Comparative Due Diligence Report

August 2025

Recommendation to America 2030. Edoardo Zarghetta, August 2025

Executive Summary

Based on comprehensive analysis of Radiant Technology, X-energy, Last Energy, NuScale and TerraPower, this report provides a structured investment framework and strategic recommendations for SMR technology investment. The analysis reveals significant differentiation in market positioning, technology maturity, and risk-return profiles across these four companies.

Market Overview

Between 2020 and 2025, AI infrastructure in the United States expanded rapidly as companies moved workloads to the cloud and generative AI emerged as a major driver of demand. By 2025, about one-third of all global data center capacity was already dedicated to AI workloads. Looking ahead, that share could approach 70% by 2030 as AI-native applications spread across industries. McKinsey estimates nearly 6.7 trillion dollars will be spent on global data centers by 2030, with more than 2.7 trillion of that in the U.S. Domestic demand is expected to keep rising 20 to 25% each year, putting continuous pressure on chip supply, the power grid, and available land. The main drivers of this growth include the massive computing needs of training large language models, the scaling of inference workloads as applications move into production, the broader digitalization of enterprises, and federal and state incentives for semiconductors and energy infrastructure.

Investment Framework: Key Due Diligence Questions

The evaluation framework encompasses 36 critical questions across six domains:

Technology & Technical Specifications (6 questions)

  • Reactor type, power output, and fuel systems

  • Safety features and operational lifecycle expectations

  • Construction timelines and site requirements

Market Position & Commercial Readiness (6 questions)

  • Regulatory approval status and deployment timelines

  • Target customer segments and competitive differentiation

  • Manufacturing scalability and partnership strategies

Financial Metrics & Economics (6 questions)

  • LCOE estimates and capital expenditure requirements

  • Revenue models and unit economics at scale

  • Total project costs and financing structures

Investment & Funding (6 questions)

  • Current valuations and investor profiles

  • Capital requirements to commercialization

  • Risk mitigation strategies and return expectations

Execution Risk & Management (6 questions)

  • Management team track records and technical milestones

  • Supply chain dependencies and manufacturing capabilities

  • Regulatory timeline risks and contingency planning

Strategic Considerations (6 questions)

  • Alignment with energy transition trends

  • Scalability potential and competitive moats

  • ESG implications and strategic partnership opportunities

Comparative Company Analysis

Technology Differentiation

Radiant Technology focuses on 1 MWe portable microreactors using TRISO fuel, targeting military and remote applications with mass production goals of 50 units annually. The company has secured HALEU fuel allocation and plans testing at Idaho National Laboratory in 2026.

X-energy develops 80 MWe high-temperature gas-cooled reactors using TRISO-X pebble fuel, designed for multi-unit plants ranging from 320-960 MW. The company benefits from Amazon's 5 GW deployment commitment and $985M+ in total funding.

Last Energy offers 20 MWe pressurized water microreactors with modular "LEGO kit" assembly, targeting industrial customers with aggressive 24-month deployment timelines. The company has secured agreements for 80 units, with 39 designated for data centers.

TerraPower operates the most advanced program with its 345 MWe Natrium reactor featuring integrated molten salt energy storage, capable of boosting output to 500 MWe. Construction began in Wyoming with $3.4B total funding including $2B DOE support.

Financial Position Analysis

Capital Efficiency Varies Dramatically: TerraPower demonstrates superior capital efficiency at $4.1M per MW, followed by Last Energy ($3.2M/MW), X-energy ($12.3M/MW), and Radiant Technology ($225M/MW). This reflects fundamental differences in scale and market positioning.

Funding Runway Assessment: X-energy maintains the strongest financial position with 9.9 years of estimated runway, while Last Energy faces the most constrained timeline at 4.3 years.

LCOE Competitiveness: TerraPower projects the lowest LCOE range ($65-95/MWh), followed by X-energy ($70-110/MWh), making them most competitive with conventional generation sources.

Risk Assessment & Investment Recommendations

X-energy: STRONG BUY (30-40% allocation)

Investment Thesis: Best-in-class funding, strategic partnerships, and technology maturity. Amazon's 5 GW commitment provides credible demand validation, while DOE ARDP participation reduces technology risk.

Key Strengths: $985M+ funding, proven TRISO technology, multi-unit scalability, and strong regulatory engagement.

Primary Risks: Extended timeline to commercialization (early 2030s) and dependence on HALEU supply chain development.

TerraPower: BUY (25-35% allocation)

Investment Thesis: Market-leading position with $3.4B funding and active construction in Wyoming. Unique energy storage integration addresses grid flexibility needs.

Key Strengths: Bill Gates backing, NVIDIA investment, most advanced development stage, and grid-scale market opportunity.

Primary Risks: High technology complexity with sodium cooling systems and significant capital requirements.

Radiant Technology: MODERATE BUY (5-10% allocation)

Investment Thesis: Fastest commercialization timeline (2028) targeting stable military demand[1][2]. Mass production model offers scalability potential.

Key Strengths: Strong VC backing (a16z, DCVC), HALEU fuel allocation, and clear market demand from defense applications.

Primary Risks: Very limited scale (1 MW) and high capital intensity constraining broader market applicability.

Last Energy: HOLD/WATCH (0-5% allocation)

Investment Thesis: Attractive unit economics and aggressive deployment timeline, but significant execution risks. Regulatory challenges with NRC create uncertainty.

Key Strengths: Lowest capital per MW, modular approach, and 80 units under agreement.

Primary Risks: Limited funding ($64M total), regulatory disputes, and unproven commercial execution.

Market Context & Strategic Considerations

SMR Market Dynamics

The global SMR market is projected to grow from $6.1 billion in 2023 to $7.7 billion by 2030, representing a 3.3% CAGR[35]. However, industry analysis suggests significant challenges remain, with LCOE estimates ranging from $36-117/MWh depending on deployment scenarios.

Regulatory Timeline Realities

NRC licensing processes typically require 3-4 years for construction permits, with total deployment timelines of 5-10 years from contract to operation. Only NuScale has achieved full NRC design certification to date, highlighting regulatory complexity.

Technology Maturation Requirements

First-of-a-kind (FOAK) projects face substantial cost premiums and schedule risks compared to nth-of-a-kind (NOAK) deployments. Learning effects and economies of scale become critical for long-term competitiveness.

SMR Nuclear Fuel Analysis: Regulatory, Economic, and Disposal Considerations

TRISO Fuel (Radiant Technology & X-energy)

TRISO (Tri-structural Isotropic) fuel features spherical uranium kernels surrounded by protective layers of carbon and silicon carbide, providing exceptional safety characteristics up to 1600°C. Regulatory approval has advanced significantly, with the NRC issuing final safety evaluations for TRISO fuel qualification methodologies in 2025, establishing a common regulatory framework with Canada. X-energy’s TRISO-X facility application was accepted by the NRC with a 30-month review schedule. Procurement costs are substantial at approximately $30,000 per kilogram compared to $2,000/kg for standard fuel, with projections of $15,000/kg at scale. The high cost reflects complex particle fabrication ($25,000/kg) and HALEU enrichment requirements ($5,000/kg vs $1,500/kg for standard uranium). Disposal presents unique challenges due to the graphite matrix, potentially increasing disposal volumes by 37-100% compared to conventional fuel, though the robust containment layers provide superior fission product retention.

HALEU Fuel (TerraPower)

High-Assay Low-Enriched Uranium (HALEU) enriched between 5-20% U-235 enables smaller reactor designs and longer operating cycles. Regulatory frameworks are developing through the DOE’s HALEU Availability Program, with multiple contractors (BWXT, Centrus, Framatome, GE Vernova, Orano, Westinghouse) awarded 10-year contracts worth up to $800 million total. Current commercial production exists only in Russia and the US, creating supply vulnerabilities. Procurement costs for 19.75% enriched HALEU are estimated at $23,725-25,725 per kilogram, with 65% of costs attributed to existing LEU fuel cycle activities and 35% to new HALEU-specific processes. Disposal economics are complicated by higher decay heat generation requiring extended cooling periods (potentially centuries), larger waste packages, or expanded repository footprints, while higher fissile content necessitates enhanced neutron absorbers for long-term criticality control.

Standard Nuclear Fuel (Last Energy)

Standard nuclear fuel using conventional low-enriched uranium (3-5% U-235) in pressurized water reactor configurations represents the most mature technology. Regulatory approval follows well-established NRC frameworks with decades of operational experience, though Last Energy faces specific challenges with their modular approach and deployment timeline disputes. Procurement costs are the most competitive at approximately $2,000 per kilogram including uranium ($842), conversion ($120), enrichment ($401), and fabrication ($300), translating to fuel costs of 0.46¢/kWh. Disposal infrastructure is well-developed with established cost structures of approximately 0.1¢/kWh through the Nuclear Waste Fund, representing the lowest-risk waste management pathway.

Key Investment Implications

Cost Structure Impact: The fuel cost differential is substantial, with TRISO fuels adding $15-25/MWh compared to standard fuel, potentially affecting overall project economics. Last Energy’s standard fuel provides the most predictable cost structure, while advanced fuels require premium market positioning to justify higher operational costs. Supply Chain Risk Assessment: HALEU faces the highest supply vulnerability with only Russian and US production capabilities, creating geopolitical risk for TerraPower. TRISO fuels have limited suppliers but benefit from domestic production capabilities, while standard LEU enjoys mature global supply chains. Regulatory Timeline Considerations: Standard fuel offers the fastest deployment pathway with established frameworks, while TRISO benefits from recent NRC methodology approvals providing clearer regulatory certainty. HALEU relies on ongoing DOE programs with multiple qualified contractors reducing single-point-of-failure risks. Total Lifecycle Cost Impact: When combining fuel, disposal, and supply chain risks, the economic hierarchy shows standard fuel ($5-7/MWh), HALEU ($10-20/MWh), and TRISO ($20-30/MWh), with disposal costs adding 0.1-0.6¢/kWh depending on fuel type. These differentials significantly impact the overall LCOE competitiveness of each SMR technology against conventional generation sources.

Economic Impact Summary

Fuel cost comparison per MWh reveals significant differences: standard fuel costs $5-7/MWh, HALEU approximately $10-20/MWh, and TRISO fuel $20-30/MWh when accounting for enrichment and fabrication complexities. Waste disposal costs range from 0.1¢/kWh for standard fuel to potentially 0.4-0.6¢/kWh for advanced fuels due to volume increases and enhanced containment requirements. Regulatory pathways are most established for standard fuel, moderately developed for HALEU through government programs, and emerging for TRISO with recent NRC approvals providing clearer frameworks. The total lifecycle cost impact suggests advanced fuels could add $15-25/MWh to generation costs compared to standard fuel, requiring offset through improved capacity factors, longer operating cycles, or premium market positioning to maintain economic competitiveness.

Investment Committee Recommendations (to America 2030 not to External Investors)

Portfolio Construction Strategy

Core Holdings (65-75%): Concentrate investments in X-energy and TerraPower as primary positions, leveraging their superior funding, partnerships, and technology maturity.

Satellite Positions (10-15%): Maintain smaller allocation to Radiant Technology for military/niche market exposure and timeline diversification.

Watch List: Monitor Last Energy for potential entry after regulatory resolution and additional funding rounds.

Key Monitoring Metrics

  • Technical Milestones: Testing schedules, NRC approvals, and construction progress

  • Commercial Traction: Customer commitments, partnership announcements, and deployment contracts

  • Financial Health: Funding rounds, burn rates, and capital efficiency improvements

  • Regulatory Progress: Licensing approvals, permit submissions, and policy developments

Risk Mitigation Approach

Diversification across different technologies (HTGR, PWR, sodium-cooled), market segments (military, industrial, grid-scale), and deployment timelines (2026-2032) provides portfolio resilience against sector-specific risks while maintaining upside exposure to SMR market development.

The SMR sector represents a compelling long-term opportunity driven by decarbonization imperatives and AI-driven energy demand growth, but requires careful selection given significant technology, regulatory, and execution risks across individual companies.

Disclaimer: The information provided in this report is for informational purposes only and does not constitute financial, investment, legal, or tax advice. You should consult with your own professional advisers before making any financial decisions.