Nuclear Company Oklo Receives Startup Authorization for Groves Reactor, A Key Step In Its Regulatory Journey

On Thursday, nuclear start-up Oklo (NYSE:OKLO) announced some welcome news. The company received “startup authorization” from the U.S. Department of Energy (DoE) for its Groves Reactor in Texas under the Reactor Pilot Program (RPP).

According to the company, the authorization “allows Oklo to load nuclear fuel, conduct startup testing, and proceed toward first criticality.”

It’s a big step forward for Oklo and one that is likely to have a major impact on the company’s regulatory future. Here’s what this authorization means for Oklo and why it’s a bigger deal than it seems for Oklo investors.

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Slower than molasses

In the world of nuclear regulations, safety is the biggest priority. That makes sense given the massive destructive potential of even a small nuclear reactor. Speed, on the other hand, isn’t a priority.

If anything, that’s an understatement. Obtaining commercial certification from the U.S. Nuclear Regulatory Commission (NRC) for a new reactor design takes years or even decades.

Oklo knows this better than anyone: the company began the regulatory journey for its novel sodium-cooled fast reactor SMR with the NRC in November 2016, almost ten years ago. It finally was able to submit its combined license application for the Aurora Powerhouse design in March 2020. And it’s still anybody’s guess when it might be awarded a commercial license.

The company has completed three of the five steps of its DoE RPP regulatory review for construction and operation, while an NRC audit is in progress. Once the audit is completed, the company can formally request a commercial license. It will undergo further NRC review before receiving approval... assuming neither the audit nor the review turns up any material issues that need to be corrected.

A breakneck pace

This painfully slow process is one of the reasons the U.S. hasn’t begun construction of a new nuclear power plant since 1976, and why only two existing plants have added new reactors since 1993.

The Trump Administration aimed to change that with the RPP, which was enacted by executive order in 2025 to speed up the deployment of nuclear reactors in the U.S. The RPP instructs the NRC to create an expedited pathway to approve reactors that have been safely tested by the DoE, with a deadline of 18 months to evaluate and approve new construction and operation licenses.

The RPP allowed the Groves Reactor project to move forward at unprecedented speed. The time from groundbreaking to receiving start-up authorization was just over 10 months, which included construction, hiring, fuel and equipment procurement, and the DoE authorization process.

Even Oklo CEO Jacob DeWitte seemed surprised by the breakneck pace. "This facility marks the fastest time that we are aware of to go from greenfield to substantial completion for a full-scale, privately funded and sited reactor in history,” he said in a press release.

But the important part was what he said next: “And this experience is fully translatable to future commercial deployments.” Here’s why that should be music to shareholders’ ears.

The hidden benefit

The Groves Reactor isn’t a nuclear power plant, nor does it feature Oklo’s unique sodium-cooled fast reactor SMRs. It’s a water-cooled test reactor designed to use low-enriched uranium for the production of isotopes, like those used in radiation therapy for cancer.

Currently, most radioactive isotopes used in the U.S. are produced overseas. The Groves Reactor is part of an effort to increase domestic production.

But Oklo’s primary goal is to build SMRs for power generation. The Aurora Powerhouse uses a different reactor design and fuel, and serves a different purpose. So, how does this move Oklo towards that goal?

Well, in the world of nuclear authorizations, repeating yourself is a good thing. Through the RPP, certain portions of DoE approval are expected to directly transfer to the NRC approval process, expediting the review time frame.

Image source: Getty Images.

The takeaway

Because Groves is a commercial-scale facility, Oklo notes it can “repeat the experience with demonstrated experience in siting, building, commissioning, and operating its commercial reactors in the future.”

The company also believes that the “repeatable approach to engineering, construction, commissioning, operations, and regulatory authorization ... helps reduce execution risk and accelerate future deployments across all of Oklo’s business units.”

If the process for the Aurora Powerhouse moves forward as quickly as the Groves process, Oklo could find itself months or even years ahead of schedule on its ultimate plan.

John Bromels has positions in Oklo. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.