Sabey’s Nuclear Play: How the TerraPower SMR Deal Redefines Data Center Energy in 2025

Industry Adoption: Sabey Data Centers’ Shift from SMR Interest to Execution

Between 2021 and 2024, the data center industry grappled with an inconvenient truth: the explosive growth of cloud computing and AI was on a collision course with the limitations of existing power grids. During this period, Sabey Data Centers’ strategy was one of rapid physical expansion and initial exploration into next-generation power. The company made significant investments in new capacity, including a 100 MW campus in Umatilla, Oregon, an 84 MW site in Austin, Texas, and an 85 MW expansion in Quincy, Washington. This aggressive growth underscored the impending power deficit. Sabey’s interest in Small Modular Reactors (SMRs) was evident through its support for U.S. government initiatives, such as the NuScale SMR project in Romania, and a late 2023 announcement of an “Advanced Nuclear Partnership.” However, these were positioning moves, reflecting an industry-wide interest shared by competitors like Amazon and Microsoft, rather than a concrete, company-specific execution plan.

The landscape changed dramatically in 2025, marking a clear inflection point from strategic interest to decisive action. The January 2025 Memorandum of Understanding (MoU) between Sabey and TerraPower represented a pivotal shift. This was not a generic statement of intent but a specific plan to explore the deployment of TerraPower’s 345 MWe Natrium™ reactors to provide direct, carbon-free, baseload power to Sabey’s data centers. This move signaled a new era of adoption where data center operators are no longer just passive consumers of energy but active partners in developing their own power infrastructure. The variety of activities in 2025, from the high-level SMR partnership to parallel partnerships in direct-to-chip liquid cooling (SEGUENTE) and other efficiency technologies (JetCool), reveals a holistic strategy. Sabey is simultaneously tackling the supply and demand sides of the power equation, preparing its facilities for the high-density workloads that SMRs will enable. This represents a significant new opportunity to offer unparalleled power reliability, but it also introduces the long-term threat of execution risk tied to the nascent SMR industry’s regulatory and construction timelines.

Table: Sabey Data Centers Strategic Investments

Table: Sabey Data Centers Strategic Partnerships

Geography: Sabey Data Centers’ Domestic Power Play

Between 2021 and 2024, Sabey’s geographic focus was on expanding its data center footprint in established and emerging U.S. hubs. The company deepened its presence in the Pacific Northwest with expansions in Quincy, Washington, and a planned 100 MW campus in Umatilla, Oregon. Simultaneously, it pushed into the burgeoning Texas market with the completion of its 84 MW Austin site. This domestic expansion strategy created massive, concentrated power demands in regions with varying grid capabilities and energy mixes, setting the stage for a new power procurement strategy. While the company showed awareness of global SMR developments by supporting a project in Romania, its core operational and investment geography remained firmly within the United States.

From 2025 onward, the geography of Sabey’s strategy evolved from simply locating data centers to strategically co-locating power generation with consumption. The TerraPower MoU explicitly names the Rocky Mountain region and Texas as the initial focus areas for SMR deployment. This is a highly targeted approach. Texas, in particular, is actively seeking to become an “epicenter of advanced nuclear,” creating a favorable political and regulatory environment. This shift indicates that future site selection will be dictated not just by fiber connectivity and tax incentives, but by the feasibility of deploying a dedicated, behind-the-meter nuclear power source. The leading regions for this new model are no longer just data center alleys, but areas with the geological, political, and regulatory capacity to host advanced nuclear reactors.

Technology Maturity: Sabey Data Centers’ SMR Integration

In the 2021-2024 period, Sabey’s technology focus was on managing the consequences of power density. The company pursued partnerships for advanced liquid cooling technologies, such as the one with JetCool. This was a mature, commercially available technology class aimed at improving energy efficiency on the demand side. On the supply side, SMRs were a technology class under observation. Sabey’s engagement was limited to supporting broader initiatives, treating SMRs as a future possibility rather than an integrated part of their current technology roadmap. The technology was seen as promising but still in a pre-commercial, developmental stage from the perspective of a data center operator.

The year 2025 marked a definitive change in the perceived maturity and applicability of SMR technology for Sabey. The TerraPower partnership moved SMRs from the “watch list” to the core of its long-term infrastructure plan. The focus narrowed from the general concept of SMRs to a specific technology: the Natrium™ sodium-cooled fast reactor with its integrated molten salt energy storage. This Generation IV technology, while still pre-commercial with the first plant slated for 2030, was validated for Sabey by its ability to provide flexible, baseload power and by significant third-party investment from tech giant Nvidia. The September 2025 announcement that Sabey’s data centers are engineered for liquid cooling confirms this strategic pivot; the company is now building facilities designed to harness the full potential of a dedicated, high-capacity nuclear power source, signaling that SMR integration has moved from a theoretical concept to an active engineering and design priority.

Table: SWOT Analysis of Sabey Data Centers’ SMR Strategy

Forward-Looking Insights and Summary

Sabey Data Centers’ strategic pivot in 2025 from a passive observer to an active developer of nuclear power sets a bold precedent. The year ahead will be defined by the transition from ambition to execution. Market actors should pay close attention to the outcomes of the feasibility studies conducted under the TerraPower MoU. These results will be the first concrete signal of whether the vision can become a reality, dictating project viability and timelines.

The next critical signal will be a formal site selection announcement, likely in Texas or the Rocky Mountain region. This will not only anchor the project geographically but also trigger local and federal regulatory engagement. The subsequent filing of a license application with the U.S. Nuclear Regulatory Commission (NRC) will mark the official start of a multi-year journey, and its progress will be a key barometer for investor confidence. Finally, watch for the MoU to be supplanted by a formal, binding Power Purchase Agreement (PPA), which will codify the financial terms and firm up the commitment. Sabey’s journey is no longer about if data centers will use nuclear power, but how—and they are writing the blueprint in real time. For energy strategists and investors, tracking these milestones is essential to understanding the future of energy-intensive industries.

As companies like Sabey forge new paths in energy procurement, having the right intelligence is critical. To conduct your own deep-dive analysis on Sabey, TerraPower, or the broader SMR market, explore a dedicated research platform. Request a trial with Enki today to access the granular data and analytics needed to navigate the evolving energy landscape.

Frequently Asked Questions

Why did Sabey Data Centers partner with TerraPower for nuclear energy?
Sabey partnered with TerraPower to address the ‘collision course’ between the explosive growth of AI and the limitations of existing power grids. The goal is to secure a direct, carbon-free, baseload power source to meet its massive energy needs, ensure power reliability for high-density workloads, and achieve its 2029 net-zero goal.

How did Sabey’s strategy change in 2025 compared to previous years?
Before 2025, Sabey’s strategy involved ‘initial exploration’ and general support for SMRs, reflecting a passive industry-wide interest. The year 2025 marked a ‘pivotal shift’ from this strategic interest to ‘decisive action’ with the signing of a specific Memorandum of Understanding (MoU) with TerraPower to actively plan the deployment of SMRs for its data centers.

When can we expect these nuclear reactors to be powering Sabey’s data centers?
This is a long-term strategy. The article states that TerraPower’s first commercial Natrium™ plant is ‘slated for 2030,’ and the agreement with Sabey extends through 2044. Near-term grid expansions confirm the SMRs will not solve immediate power shortages. Key milestones to watch for are feasibility studies, site selection, and the NRC license application.

What are the main risks associated with Sabey’s SMR strategy?
The primary risks have shifted from market competition to project execution. The analysis identifies ‘significant regulatory hurdles’ with the U.S. Nuclear Regulatory Commission (NRC), ‘high capital costs and long construction timelines,’ and a high-stakes dependency on a ‘pre-commercial technology’ that is not yet proven at scale.

While planning for nuclear power, what is Sabey doing to manage energy demand now?
Sabey is pursuing a holistic strategy by tackling both supply and demand. Alongside the long-term TerraPower SMR plan, the company is making near-term investments to ‘expand grid power availability’ at key campuses (October 2025) and partnering with companies like JetCool and SEGUENTE to implement advanced liquid cooling technologies that improve energy efficiency for high-density AI workloads.