Key Points
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The U.S. has accumulated 100,000 metric tons of used nuclear fuel over the past six decades.
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Conventional reactors utilize only a small fraction of the energy potential of enriched uranium, and Oklo’s fast reactors aim to make use of this spent fuel.
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The company will spend nearly $1.7 billion to build a nuclear fuel recycling facility in Tennessee.
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Over the last six decades, the United States has accumulated nearly 100,000 metric tons of used nuclear fuel. Despite generating about one-fifth of the nation’s electricity from nuclear power, the U.S. never established a permanent geological repository for spent commercial nuclear fuel.
This spent fuel could get a second chance if Oklo (NYSE: OKLO) has its way. That’s because Oklo’s nuclear reactors are designed to efficiently utilize spent nuclear fuel, creating an opportunity to get more from existing nuclear waste.
Here’s what investors need to know about Oklo’s long-term vision.
How Oklo plans to get more from nuclear waste
When it comes to nuclear energy, used nuclear fuel is not fully depleted or useless material. That’s because conventional light-water reactors extract less than 5% of the total energy potential from enriched uranium before the assemblies stop generating power efficiently and are removed. While conventional reactors cannot use the spent fuel, the remaining material still contains large quantities of uranium and other elements that advanced reactor designs could utilize.
Oklo plans to use this spent fuel in its Aurora fast reactor, a compact, advanced reactor designed to operate on high-assay low-enriched uranium (HALEU) and recycled nuclear materials. This is possible because fast reactors can more efficiently utilize the heavier isotopes in spent nuclear fuel, enabling closed-loop fuel cycles.
Oklo’s initial powerhouses are expected to use fresh HALEU fuel, but in the longer term, the company aims to recycle portions of the country’s accumulated used-fuel inventory into new reactor fuel. If it succeeds, it could expand domestic fuel supplies, reduce dependence on newly mined uranium, and lessen the burden of nuclear waste management by producing 90% less high-level waste than conventional reactors.
Oklo’s use of recycled nuclear fuel could make it an innovator in the nuclear energy space, and it is investing nearly $1.7 billion to build a nuclear fuel recycling facility in Tennessee. Construction is expected to begin here in 2027, with the facility projected to begin producing recycled fuel by the 2030s.
What’s next for Oklo?
Oklo is making important progress with its nuclear reactor technology. The company’s anchor project is the Aurora Powerhouse located at the Idaho National Laboratory. Here, the company will build a 75-MWe liquid-metal-cooled, metal-fueled reactor and aims to begin operations as soon as 2028.
It also has a major deal with Meta Platforms to build a 1.2-GW clean energy campus in Ohio. It has signed a Letter of Intent (LOI) with Centrus Energy to purchase HALEU fuel for this facility, which is slated to start delivering power in 2030, and the full campus is expected to be completed by 2034.
That said, it has a long road ahead and is vulnerable to regulatory setbacks. On top of that, it will incur significant expenses (it projects $350 million to $450 million in capital expenditures this year) before becoming commercially viable.
For those reasons, Oklo is a speculative stock best left to aggressive investors with a long-term perspective.
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Courtney Carlsen has positions in Centrus Energy and Meta Platforms. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy.
