The Trump administration is so eager to see a nuclear power renaissance that it is starting to fund billions of dollars for reactor orders.
In a new deal expected to be announced Tuesday, low-interest loans amounting to $17.5 billion from the Energy Department will be available for utilities to finance equipment orders for the Westinghouse AP1000, the company’s flagship nuclear reactor, a version of which China is building at industrial scale.
The loans are intended to speed up construction of 10 reactors in the U.S. Five loans will be available for projects with two reactors each, the Energy Department said.
U.S. Energy Secretary Chris Wright said the conditional loans were part of a broader Trump administration mission to “unleash the next American nuclear renaissance.”
They “will also help accelerate the timeline of building those large-scale reactors by up to three years, lowering construction costs and ensuring the United States is able to deliver on President Trump’s bold and ambitious energy addition agenda,” Wright said.
The hope is that new AP1000s could come online starting in 2035, said Dan Sumner, chief executive of Westinghouse Electric.
“It really kick-starts fleet-scale nuclear development in the United States,” Sumner said.
Seven utilities have already signed formal letters of intent for the five available project loans, according to the Energy Department, which didn’t name the utilities.
The companies would form partnerships with Westinghouse and each have at least one potential site for a reactor, primarily locations with an existing reactor or large power plant, or sites that have done previous licensing work with the Nuclear Regulatory Commission, the Energy Department said.
Several large power players have told regulators and investors that they aim to bring new large or small nuclear projects online sometime in the coming decades, including Duke Energy DUK -0.64%decrease; down pointing triangle, Dominion Energy D -0.73%decrease; down pointing triangleand PacifiCorp. States including New York and Illinois are also interested in expanding their nuclear generation.
Government financing could boost a big technology that has struggled to move beyond its troubled first projects in the U.S. The only AP1000s finished domestically—two units at Georgia’s Vogtle nuclear-power plant—were originally expected to cost $14 billion, but ultimately exceeded $30 billion. They were meant to be completed in 2016 and 2017, but didn’t come online until 2023 and 2024.
Paul Tice in the Wall Street Journal:
The Energy Department this April issued its Annual Energy Outlook, including electricity generation capacity projections through 2050 under various forecast scenarios. Under both the baseline and high electricity demand cases, the DOE’s estimates show no increase—and, actually, a slight absolute decline—in U.S. nuclear generation capacity over the next 25 years.
Several factors contribute to the administration’s lack of progress on the nuclear front. First, the White House appears to have fallen into a technology trap. Rather than sticking with what the industry knows how to build and operate—gigawatt-sized pressurized and boiling water reactors—officials have been overly focused on approving newer technologies (like fusion power) and more-advanced designs (mainly small modular reactors), all of which are unproven at commercial scale and will likely never move the needle on generation.
Shiny object syndrome helps explain why the current U.S. nuclear fleet of 96 operating reactors includes more than 50 different commercial reactor designs, an excessive degree of diversification not warranted by national-security concerns. For the past 60 years, endless iteration has needlessly complicated an already complex regulatory approval process and deprived the nuclear industry of the normal learning process and economies of scale that come with standardization and repetition.
Duke Energy, Integrated Resource Plan, 2025:
Given the substantial upfront capital investment required for deployment of new nuclear generation (relative to other types of generation), support will be required in the form of cost overrun protection, which currently does not exist, or other cost mitigation measures. Units 3 and 4 at Plant Vogtle were the first advanced reactor LLWR projects in the U.S. with two AP1000® units constructed and placed into commercial operation.
The Vogtle project experienced significant delays and cost overrun, with the total cost more than double the original projected cost. Though some issues were unique to that project, the first and second movers for the next advanced reactor projects will be assuming construction risks and therefore will need some form of insurance to protect customers.
It is essential that the current tax credits that incentivize new nuclear generation remain in place, as they provide critical financial support for these investments and decrease investment risk, which will lead to lower overall costs for customers.
In addition, the current tax credits that incentivize the efficient operation of the existing nuclear fleet are also essential, as they help keep energy prices low, with every dollar going back to customers. Further, the federal loan guarantee program, federal grant opportunities, and other mechanisms like public-private partnerships could provide crucial support.
Given the risks and long-lead time associated with constructing new nuclear, cost overrun protection would further decrease investment risk in a manner that would benefit customers.
In sum, without continued federal support, the financial risk of nuclear construction could deter development, slowing, delaying, or eliminating progress despite the substantial potential benefits of new nuclear generation for customers.
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Below, a Department of Energy video celebrates “The Golden Age of Nuclear Energy”.