French nuclear startup Naarea plans to raise €150 million ($164m).

The small modular reactor (SMR) company hopes to close the fundraising in the first quarter of next year, Bloomberg reports.

Naarea aims “to produce power and heat as close as possible to industrial companies, to relieve the grid," CEO Jean-Luc Alexandre told the publication.

– Naarea

Naarea (that is, Nuclear Abundant Affordable Resourceful Energy for All) is developing a molten salt fast neutron reactors that burns plutonium and radioactive waste that’s stored in France. It claims to have developed a ceramic that prevents corrosion from the liquid fuel, a stumbling block for similar past approaches.

These reactors could produce 40MW of electricity, the company believes. It hopes to have a full-scale prototype in 2028, but said that it needs to raise around €2 billion ($2.2bn) by 2030 to complete the reactor development, build a fuel plant near Orano SA’s nuclear-waste recycling facility, and set up a separate reactor factory also in France.

The company is one of a number of SMR companies looking to disrupt the energy market, often using different nuclear fuel and different technological approaches.

Several have already eyed the data center industry as an obvious market, given the sector's growing power needs and challenges with the grid.

Rolls-Royce has begun pitching 470MW modular power plants to data centers, with a planned roll out of 2030, while Last Energy has already found customers in the UK for 20MW SMRs. Sam Altman-backed Oklo is also planning 15MW+ SMRs, while Microsoft cofounder Bill Gates has backed TerraPower.

But the sector was hit by setbacks when frontrunner NuScale saw its flagship deal canceled, while another deal with a blockchain company has been labeled fake by short seller Iceberg Research.

“NuScale isn’t dead, and still has projects,” Naarea CEO Alexandre told Bloomberg.