Terrestrial Energy, a Canadian nuclear startup, has merged with a special purpose acquisition company (SPAC) in a deal that is expected to raise $280 million for the development of its small modular reactor (SMR) technology. The combined entity will list on Nasdaq under the symbol ISMR, a nod to the company's integral molten salt reactor design.

Before the merger, Terrestrial Energy had raised $94 million, according to PitchBook. The additional funding will support the company's efforts to bring its SMR technology to market, which is designed to provide clean and efficient energy for a range of applications, including electric power, data centers, and industrial processes that require heat.

Terrestrial Energy's SMR technology is based on an integral molten salt reactor design, which uses uranium fuel mixed with salts such as lithium fluoride or sodium fluoride to suspend the nuclear fuel and act as the reactor's primary coolant. The reactor core is designed to be replaced every seven years, addressing some of the corrosion issues that plagued earlier molten salt reactors.

The company's SMR design also includes the fuel, graphite moderators, heat exchangers, and pumps that regulate the fission reactions and keep the salt cool and flowing. This integrated approach is intended to improve the efficiency, safety, and cost-effectiveness of the reactor.

Terrestrial Energy is not alone in pursuing SMR technology. Several other startups, including Oklo, have also received significant funding to develop their own SMR designs. The interest in SMRs is driven in part by the growing demand for electricity, particularly from data centers and other industrial applications.

The electrification of buildings and transportation, combined with the rapid growth of data centers, has sent electricity demand soaring. Tech companies, including Google, Meta, Amazon, and OpenAI's Sam Altman, have taken notice and are investing in SMR technology as a potential solution to meet their electricity requirements.

While Terrestrial Energy's merger with a SPAC is a significant milestone, it is not the first SMR startup to take this route. Oklo, backed by Sam Altman, completed its SPAC merger in 2024. Given the current hype around nuclear power, it is likely that Terrestrial Energy will not be the last SMR startup to pursue a SPAC merger.

The success of Terrestrial Energy's merger and the growing interest in SMR technology could have significant implications for the future of nuclear power. As the world continues to grapple with the challenges of climate change and energy security, innovative approaches like SMRs could play a critical role in providing clean and efficient energy for generations to come.