David Tepper says projections for nuclear powering AI are `crazy’

David Tepper, founder of Appaloosa Management, said that natural gas will be needed to power AI and that projections for nuclear powering AI appear to be “crazy.”

I’ve spoken to governors around the country, both Republican and Democrat, “and they are not going to let their nuclear power come offline,” Tepper said in an interview on CNBC on Thursday. “It’s not going to happen. It’s a joke. Some of these projections on these things are crazy.”

Tepper’s comments come after Constellation Energy (NASDAQ:CEG) shares skyrocketed 23% on Sept. 20 after the company signed a 20-year power purchase agreement with Microsoft (MSFT) that will pave the way to restore service to one of the units at its Three Mile Island nuclear power plant in Pennsylvania and keep it online for decades. Under the agreement, Microsoft (MSFT) will purchase energy from the renewed 835 MW reactor as part of its goal to help match the power used by its data centers in PJM with carbon-free energy.

“It has to be if you’re going to meet these power needs of what they need for AI, you’re going to have to use natural gas,” Tepper, who owns the Carolina Panthers NFL team, told the business network.

Constellation (CEG) plans to spend ~$1.6B to revive the plant, which it expects to come online by 2028; the company said it expects to renew its license that would extend plant operations to at least 2054. Shares of Vistra (VST), which also boasts a strong nuclear power presence, also surged 16% on Sept. 20, and have risen for 14 of the last 15 trading days. Vistra shares have gained 206% this year, whole Constellation has risen 120%. Vistra is the best gainer in the S&P 500 Index this year after surpassing Nvidia (NVDA) on Wednesday.

“If you take a current nuclear plant, and you think you are going to get these things, it will never get by these individual PUCs,” Tepper added. “It won’t. It can’t. It’s going to hurt the consumer too much. It can’t hurt the consumer that much. It’s nuts.””So I hear these guys talk about well, you know, if we did this,” Tepper added. “Well if I was 7’2 I would be in the NBA one day. I’m not 7’2.”