Duke Energy's Nuclear Bet Signals the AI Power Shift

The energy demands of the digital age are no longer just talking points in quarterly earnings calls. For the past two years, tech sector giants have warned that the rapid expansion of artificial intelligence (AI), data centers, and a trend known as “The Electrification of Everything” would strain the nation's electrical grid. 

Industry estimates suggest that power usage from data centers could double by 2030, creating an urgent need for reliable electricity.

On Dec. 30, that abstract debate took a tangible step forward: Duke Energy (NYSE: DUK) officially filed an Early Site Permit (ESP) application with the Nuclear Regulatory Commission (NRC). This filing marks a critical step forward for the energy sector.

We are finally moving from a phase of speculation and PowerPoint presentations into a phase of federal permitting and physical infrastructure development.

For investors, this signals that regulated utilities are stepping up to anchor the nuclear renaissance. Duke Energy’s move offers a glimpse into how the grid of the 2030s will be built.

This provides a stable, dividend-paying entry point into the AI energy boom, in contrast to the more volatile technology stocks often associated with this trade.

Replacing Coal With Atoms

The application that Duke Energy has filed specifically targets the Belews Creek Steam Station in Stokes County, North Carolina. This choice is highly strategic and speaks to the financial discipline Duke is applying to this project. Belews Creek is currently a coal and natural-gas facility. By choosing an existing site rather than a greenfield (undeveloped) site, Duke Energy can leverage billions of dollars in existing infrastructure.

The transmission lines that carry power to the grid are already in place. The site has established access to water for cooling, and the local workforce is already trained in power generation. This Coal-to-Nuclear strategy is designed to reduce construction costs and shorten timelines, addressing two of the biggest historical risks in nuclear development.

Duke’s approach to the permit is technology-neutral. Instead of committing to a single reactor design immediately, the utility has listed six potential advanced reactor designs in its application. This includes designs from established players and newer entrants. This flexibility is a risk mitigation tool. It allows Duke to proceed with the lengthy regulatory site review, which can take up to three years, while observing which reactor technologies mature most effectively in the interim. The target in-service date for the first unit is 2036.

How Duke Profits: The Regulated Asset Model

For entry-level investors, it is vital to understand how a regulated utility like Duke Energy makes money from a massive project like this. Unlike a tech company that sells products or subscriptions, a utility operates as a regulated monopoly. It earns a return on the capital it invests in infrastructure, known as its rate base.

When Duke builds a nuclear plant, the construction costs are not viewed strictly as expenses that hurt the bottom line. Instead, they are assets. Once regulators approve the project, Duke is allowed to charge customers rates that cover the cost of the plant plus a guaranteed profit margin.

Because nuclear plants are capital-intensive, meaning they cost a significant amount to build, they offer a substantial opportunity for Duke to grow its rate base over the next decade. This structure provides a high degree of earnings visibility. For the income-focused investor, this translates to security. The growth of the rate base supports the company's ability to maintain and increase its dividend payments, which is the primary reason many investors hold Duke Energy stock.

Validation and Velocity: Utilities vs. Merchant Nuclear

While Duke Energy represents the conservative, regulated path to nuclear expansion, its filing today has ripple effects across the broader sector. The technology-neutral list included in the permit acts as a watchlist for investors tracking smaller, more speculative nuclear stocks.

Validation for NuScale Power

Notably, the application explicitly lists the VOYGR power plant design by NuScale Power (NYSE: SMR) as a contender. NuScale has faced skepticism in the past regarding the commercial viability of its Small Modular Reactors (SMRs). However, being shortlisted by one of the largest regulated utilities in the United States serves as a significant vote of confidence.

It suggests that major grid operators view NuScale’s technology as grid-ready. Even without a signed construction contract today, this inclusion validates the technology and strengthens the investment case for NuScale as a leading hardware supplier for the utility sector.

The Need for Speed: Oklo Inc.

Investors should also note the contrast between Duke’s timeline and the aggressive schedules of merchant developers like Oklo Inc. (NYSE: OKLO). Duke is targeting 2036 to ensure massive, grid-wide stability. In comparison, Oklo is racing to deploy power much faster.

• Different Models: Duke is a regulated monopoly serving millions of homes. Oklo is a merchant company that plans to sell power directly to specific customers, such as data centers.
• Different Timelines: Oklo broke ground on its Idaho facility in September 2025 and targets deployment by 2027 or 2028.
• Recent Progress: On Dec. 16, 2025, the Department of Energy approved the safety analysis for Oklo’s fuel fabrication facility, a major step toward operational independence.

This creates a clear split in the market. Duke Energy offers safety and a timeline aligned with federal regulations. Oklo offers speed and direct exposure to the immediate demands of AI companies, but with the higher risks associated with a pre-revenue company.

Balancing Safety and Speed: The Clean Firm Premium

The search for clean firm power, electricity that is carbon-free and available 24/7, is the defining energy trend of this decade. Solar and wind are essential, but they cannot run a data center through a windless night. Nuclear energy is increasingly viewed as the only scalable solution to fill this gap.

Duke Energy’s Early Site Permit filing is a signal that the Southeast U.S. grid is committing to a nuclear future. For investors, the strategy depends on risk tolerance.

For those seeking income and stability, Duke Energy remains a strong candidate. The move to add nuclear to the rate base secures long-term growth and supports the dividend, making it a suitable anchor for a conservative portfolio.

For those seeking growth, the filing provides indirect support for technology developers such as NuScale and highlights Oklo's unique speed advantage.

These stocks represent the picks and shovels of the industry, offering higher potential returns for those willing to weather volatility. 

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