Musk’s Natural Gas Pivot Signals Nuanced Outlook for Nuclear Stocks Like Oklo and NuScale — BigGo Finance

Elon Musk’s evolving stance on natural gas is sending mixed signals to investors trying to position for the coming surge in electricity demand from artificial intelligence and space infrastructure. The SpaceX chief executive, who once framed Tesla’s entire mission as accelerating the death of the “mine-and-burn hydrocarbon economy,” acknowledged in late July that he is no longer opposed to using natural gas as a long-term bridge fuel, particularly to offset the seasonal decline in solar output during winter months.

That admission, posted on X on July 31, comes as SpaceX builds a dedicated natural gas pipeline to support rocket launches while its rapidly expanding AI compute operations increasingly lean on gas-fired power. The shift matters beyond SpaceX itself: it complicates the investment case for nuclear energy companies that have ridden a wave of AI-driven enthusiasm, including small modular reactor developers NuScale Power (SMR) and Oklo (OKLO).

During SpaceX’s first investor call on Aug. 11, Musk laid out the scale of the company’s near-term power ambitions. “Our tentative target is to actually have 20 gigawatts at the power and cooling level online by the end of next year,” he said, before tempering expectations. “Now I don’t think we’re going to achieve 20 gigawatts, but we want to have a series of projects that cumulatively come to 20 gigawatts by the end of next year. Some of them won’t pan out exactly on time, but I would expect that we still probably have at the power plant level, something close to 15 gigawatts.”

For context, New York City consumes roughly 10 gigawatts at peak demand during a summer heat wave. SpaceX expects to soon need more power on a daily basis than the largest city in America.

The company has so far relied on a diverse energy mix — wind, solar, and natural gas — to support its data center build-out. Other technology giants have been far more aggressive on nuclear. Alphabet and Microsoft have each committed to large-scale nuclear projects, ranging from new construction to restarting dormant systems. That divergence underscores a broader industry debate: how quickly can nuclear capacity realistically come online, and what fills the gap in the meantime?

Bank of America analysts have framed nuclear energy as a $10 trillion global opportunity over the coming decades, driven by the AI sector’s need for massive amounts of clean, baseload power. Companies like Oklo and NuScale are considered prime beneficiaries given their focus on small modular reactors, which are designed to be built faster and colocated with data center infrastructure. Yet traditional nuclear plants often take a decade or more to complete, limiting the industry’s ability to satisfy near-term power demand.

That timing gap is precisely where natural gas retains an advantage. Musk’s public acknowledgment that gas will play a role — “even long-term to some degree” — suggests the energy transition will be more layered than the binary renewables-versus-fossil-fuels framing he once championed. In a 2006 blog post for Tesla, he wrote that the company’s overarching purpose was “to help expedite the move from a mine-and-burn hydrocarbon economy toward a solar electric economy.” A decade later, he warned that failure to achieve sustainability would mean civilization would “run out of fossil fuels to burn.”

Those earlier statements have not been retracted. Tesla now produces more than 1.5 million electric vehicles annually and sells massive battery systems to support renewable integration. But SpaceX’s operational reality — rockets that need reliable fuel infrastructure and AI data centers that need uninterrupted power — has pushed Musk toward a more pragmatic posture.

The implications for nuclear investors are nuanced. If natural gas remains a durable part of the energy mix, the urgency to deploy nuclear capacity could diminish at the margins, potentially weighing on valuations for pre-revenue SMR developers that trade on future growth expectations. On the other hand, the sheer magnitude of expected demand growth — with SpaceX alone targeting 15 to 20 gigawatts within roughly a year — suggests there may be room for multiple power sources to scale simultaneously.

Oklo, which designs nuclear systems specifically for AI data center customers, could benefit from an energy arms race even if Musk’s own companies lean on gas. The developer has no direct connection to SpaceX or its AI operations, but the competitive pressure Musk’s comments create could accelerate procurement decisions across the tech sector. There is also speculation that heightened energy demand could make Oklo an acquisition target, though no formal discussions have been disclosed.

NuScale, the first company to receive U.S. Nuclear Regulatory Commission design approval for an SMR, faces a different challenge. Its technology has cleared regulatory hurdles, but commercialization has been slower than some investors hoped. The company’s stock has been volatile as the market weighs the promise of modular nuclear power against the reality of long development timelines and capital-intensive projects.

The broader picture is one of a rapidly expanding energy pie. AI data centers, electric vehicles, industrial electrification, and space infrastructure are all competing for finite power resources. Whether nuclear or natural gas captures the largest incremental share will depend on execution speed, cost curves, and regulatory environments — factors that remain highly uncertain.

Musk’s comments do not represent a wholesale retreat from his sustainability goals. Rather, they reflect an acknowledgment that the transition will require bridge fuels and that even the most ambitious clean energy advocates must contend with operational constraints. For investors, the key question is whether natural gas’s persistence delays nuclear adoption or simply coexists with it in a market where demand is growing faster than any single technology can supply.

The energy landscape in 2026 increasingly resembles a portfolio problem rather than a binary choice. Companies that can deliver reliable power quickly — whether through gas turbines, SMRs, or utility-scale solar with storage — are likely to find willing customers. Musk’s pivot is one prominent data point in that evolving calculus, but it is unlikely to be the last.