Three small nuclear reactors will power Oracle's new data center.

• Larry Ellison, chairman and co-founder of Oracle, stated that the company is planning to construct a data center that will necessitate over a gigawatt of power.
• This week, Ellison informed investors that the data center would be powered by three small modular nuclear reactors.
• Next-generation small modular reactors have the potential to provide reliable, carbon-free power quickly, but they face obstacles in reaching the commercial stage.

This week, Larry Ellison, the chairman and co-founder, made a "bizarre" announcement.

Oracle is considering using next-generation nuclear technology to meet the increasing electricity demand from artificial intelligence, as stated by Ellison during the company's earnings call on Monday.

"Ellison declared to analysts, "I have something to say that will sound quite unusual." They might respond, "Well, you're known for saying unusual things, so why is this one any different?" The implication being that it must be truly bizarre."

The chairman of Oracle announced that the company is building a data center that will need over a gigawatt of electricity. He stated that the data center will be powered by three small nuclear reactors.

"The data center's power source, three small modular nuclear reactors, have already obtained building permits," Ellison stated. "This is how insane the situation is becoming."

Oracle declined to reveal the location of the data center or the future reactors when asked by CNBC.

New designs known as small modular nuclear reactors aim to accelerate the provision of dependable, carbon-free energy to meet increasing energy demands from data centers, factories, and the broader electrification of the economy.

These reactors are typically 300 megawatts or smaller, which is about one-third the size of the typical reactor in the current U.S. fleet. They would be constructed in several parts and then assembled on-site, thereby reducing the capital costs that hinder larger plants.

Small modular reactors are not yet commercially viable in the U.S., with most nuclear industry executives predicting that they will become a reality by the 2030s.

The Nuclear Energy Agency reports that there are three operational small modular reactors globally, with two located in China and Russia, countries at odds with the U.S. Additionally, a test reactor is operational in Japan.