European nuclear start-ups shift focus to US in search for funding
American investors galvanised by possibilities of technology they hope can power expected AI boom
Europe’s cutting-edge nuclear start-ups are preparing to switch operations to the US as they seek deeper financing and stronger government support, warning they are losing out to well-resourced rivals in the race to develop the technology.
President Donald Trump’s enthusiasm for the sector, and the potential of a new generation of small modular reactors (SMRs), has galvanised US investors’ interest in the possibilities for technology they hope can power the expected AI boom.
This has helped fuel eye-popping valuations for some US nuclear developers, and helped others to raise hundreds of millions of dollars, far exceeding the sums available in Europe, where some start-ups have struggled with liquidity.
European developers of advanced nuclear reactors told the FT that moving some parts of their business to the US or setting up new operations there was imperative if they wanted to stay in what has also become a global fight against Chinese developers.
Newcleo, a Franco-Italian start-up developing lead-cooled reactors that use nuclear waste as fuel, is eyeing the US for “a third of our deployment”, including a possible fuel fabrication site in South Carolina.
Chief executive Stefano Buono said the US would replace the UK in its plans, having opted to abandon the British market last year.
“In the UK we had zero support, and no financial support,” Buono said. “The government was not really backing advanced modular reactors, they started supporting the third generation, not the fourth generation.”
Aerospace, defence and energy company Rolls-Royce has been selected by the UK to build a future fleet of reactors and has funding pledges as a result, but its designs use the older pressurised water reactors rather than more experimental technology.
“It’s clear [the US] are strongly supporting advanced nuclear in a way that Europe is not,” said Kiki Lauwers, chief executive of Franco-Dutch developer Thorizon, another company seeking to tap the booming North American market.
Lauwers pointed to hefty US energy department subsidies for American nuclear companies such as Amazon-backed X-energy or Bill Gates’ TerraPower — the latter received $2bn to fund its first reactor — matched by large private fundraisings. Europe lacks the capital depth to do the same, she added.
French nuclear start-up Naarea struggled to raise funding and went into receivership last September — a procedure to protect it from creditors. A court will this week rule on a buyout offer from Luxembourg and Poland-based waste treatment group Eneris, leaving its next steps in the balance.
Chief executive Jean-Luc Alexandre had been eyeing moving operations to the US, telling the FT late last year that was where nuclear companies could “go faster”.
The company, which aims to use liquid salt as a reactor coolant, raised an initial €100mn from family offices in France and a further €10mn from a French government scheme in 2023. But it had estimated its funding needs at €2bn.
“Europe is not where it needs to be on this right now,” Alexandre said.
Europe is home to one of the world’s top nuclear operators, France’s EDF, which built dozens of large reactors between the 1970s and 1990s. French SMR developers and related suppliers account for the biggest chunk of members of a 350-strong European SMR alliance.
Industrial companies and data centres are pinning their hopes on powerful but easily replicable small reactors to fuel their electricity needs and plans to reduce emissions.
But even in France, the state has earmarked about €1bn in funding for nuclear start-ups, when advanced reactor developers need about €1bn each, according to French energy regulator estimates.
Christophe Grudler, a lawmaker in the European parliament, said more EU financing would become available in the coming months for nuclear research and prototypes with project-based funding.
He also noted that while Europe might be slower to advance, it did so meaningfully. “The Trump of one day may not be the Trump of tomorrow. Europe’s a reliable partner,” he said.
But some European start-ups courting the US said they had already seen a pay-off. “The moment we said we were going to do operations in the US, our own existing investors started to put in more money,” said Newcleo’s Buono.
He warned that the next two years would be crucial for the sector, as prototypes were built out and expanded, and that many businesses might not survive.
“It’s a challenging phase, a sort of death valley,” Buono said. “A lot of companies fail to deliver in this phase.”