A startup co-founded by former Texas Gov. Rick Perry went public this week, raising the young company’s value to $19 billion following an initial public offering this week.
Fermi America, based in Amarillo, plans to harness nuclear energy to power AI data centers. The company already has the attention of Wall Street, with shares up 55 percent over the opening price after one day of trading.
Claire Hao covers energy and the power grid for the Houston Chronicle. She says the massive power needs of AI data centers appeal to Wall Street investors. Listen to the interview above or read the transcript below.
This transcript has been edited lightly for clarity:
Texas Standard: Fermi America is described as a nuclear and data center company. Spell that out for us. What does that mean? What does Fermi plan to do?
Claire Hao: Yeah, so essentially artificial intelligence, which is getting more and more embedded in all parts of our lives, the servers that host the data for artificial intelligence are stored in these massive warehouses called data centers. And data centers use a ton of electricity. And there’s a lot of excitement on Wall Street about just how much power data centers could use and the lucrative opportunity to supply them that power.
So Fermi America has a proposal to build what they say will be the world’s largest data center powered by what they say will be the country’s largest nuclear complex. So very ambitious plans.
And they want to bring online a mega reactor, the first one by 2032, and then bring three others and then also in the interim. So by the end of next year, they also want to bring online natural gas power and solar as well.
You know, there’s been a lot of talk about these small nuclear power plants being constructed near some of these data centers, but it sounds like what you’re describing is a massive facility.
Could you square that away for us? Is Fermi talking about these smaller nuclear power plants or something much larger that would run multiple AI centers?
What Fermi is talking about building are large traditional reactors. You’re right. There is a lot of excitement about what’s known as small modular reactors, the reason being these very large traditional reactors are a tried and true technology.
But the nuclear industry has a history of taking a very long time to build them and they are also very expensive to build. So the last time a large reactor was completed in the U.S. was in 2023 by a Georgia utility and it was $17 billion over budget and many years delayed.
So Fermi, what they’re trying to do is they’ve hired folks that have successfully built these projects in China and in other countries where it has been a lot smoother to build these. And Fermi wants to try to make it a quicker process.
Tell us about Rick Perry’s involvement. He’s a former U.S. energy secretary. Is that where his interest in nuclear power and AI comes from?
Well, he co-founded this company. His son, Griffin Perry, is also involved in the company.
Rick Perry, obviously a high-profile name attached to this company, is one of many headline grabbing things about it, the other being that Fermi America has teased in their application that they might name the whole project or some of the nuclear reactors on site after President Donald Trump.
But Rick Perry says that he really wants to help the U.S. catch up to countries like China when it comes to delivering nuclear power for the AI race. He says we’re already behind. And so that is what he’s saying about why he wants Fermi to do what it’s doing.
But obviously, also he was the energy secretary in Trump’s first term…
Has his connections.
I want to ask about the fact that this IPO brought in a whole lot more money than was expected and sort of raised some eyebrows for a company that hasn’t yet earned any revenue. And in fact, I think the company was just launched this year, right?
Yeah. So their initial public offering was $21 per share, and then it closed at more than $32 per share on the first day of trading. It’s fallen a little bit now to about $28 per share, but still, I mean, this company has yet to bring in any revenue.
It was just formed at the beginning of this year in mid-January. It was announced in June. Not even ten months old at this point.
So far in the first half of this year, they have reported a $6.4 million loss, and they do lay out a lot of different risks to their business, including the fact that what they’re trying to build may never happen. So there are risks to investing.
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What is it about how successful this IPO was? I think that a lot of people weren’t expecting it to be quite as successful as opening day proved to be. Is this about something Fermi is doing or just something about the general interest in this industry?
Well, I think that just shows there’s a lot of hype on Wall Street around artificial intelligence-related ventures. And Fermi, in the four months since its announced itself as a company, has found a lot of different ways to grab people’s attention.
Through what?
…the fact that Rick Perry is involved, some of the really bold plans that it has, the fact that this company was first reported by the Washington Post, who reported that it could name the whole thing after President Donald Trump.
So I think a lot of different things that make folks want to take an interest.
What’s next for Fermi? Do you know anything on that score?
Yeah, so they’re going to take the money that they’ve raised from going public and put it back into actually trying to make their goals a reality.
So, you know, trying to secure some of the equipment that’s needed for the site, trying to work to find tenants for their data center site that are confirmed… Just in general, try to work towards bringing online some power by the end of 2026 from natural gas and solar.
And then in the longer-term, their goal is by 2032 to bring online the first nuclear reactor.
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