DOE is Prioritizing a New Era for Nuclear

With U.S. electricity demand expected to increase significantly—largely driven by AI and data center needs, increased manufacturing and electrification—next-generation nuclear technologies represent a tremendous opportunity. As these industries seek to procure reliable, round-theclock, clean sources of electricity, advanced and modular nuclear technologies stand out as a uniquely qualified energy source to meet the growing demand for firm, affordable power. Accelerating the deployment of next-generation nuclear can also bolster American global competitiveness vis-à-vis hostile nations like China and Russia, which leverage nuclear exports to expand geopolitical influence

Recently, the Department of Energy (DOE) announced up to $800 million in cost-sharing funding to accelerate the development and deployment of small modular reactors (SMRs). These grant awards represent one of the most significant federal commitments to near-term nuclear deployment in decades. They are part of the Generation III+ Small Modular Reactor Pathway to Deployment Program, designed to de-risk deployment and help early projects move from licensing and site preparation toward commercial construction.

DOE closely followed this announcement with a separate set of awards totaling $2.7 billion to three companies to expand domestic uranium enrichment capacity over the next decade. This funding is intended to strengthen the U.S. nuclear fuel supply chain, reduce reliance on foreign enrichment services and ensure fuel availability for the next generation of advanced nuclear reactors. Together, DOE’s investments in near-term reactor deployment and domestic enrichment represent a coordinated strategy to ensure that new nuclear projects can be built, fueled and sustained at scale.

New Nuclear: Ready for Growth

Since the 1990s, commercial nuclear facilities have consistently provided around 20% of U.S. electricity generation. However, nuclear generation is set for substantial growth. Projections by Wood Mackenzie forecast it will remain stable until 2035, but could increase by around 27% through 2060 as new nuclear assets come online. According to the International Atomic Energy Agency (IAEA), nuclear electricity production in North America could increase by up to 50% by 2050 (Figure 1), while global production could triple. 

Figure 1. Nuclear electricity production in the North American region. 

Source: International Atomic Energy Agency (IAEA), Energy, Electricity and Nuclear Power Estimates for the Period up to 2050 (2025 edition). 

Accelerated nuclear generation growth like this will be possible through the deployment of new advanced nuclear technologies, like SMRs. Designed for faster deployment, built-in safety, generation flexibility and scalability, SMRs offer numerous benefits when compared to traditional utility-scale reactors.  

First, SMRs are modular by design—an approach in which products or facilities are built from standardized, interchangeable sections in a factory, then transported and assembled on-site. This enables benefits for projects such as faster construction, reduced upfront costs, improved quality control, less waste and greater flexibility compared to traditional construction processes. By shortening deployment timelines and increasing cost efficiencies, they lower the risk of cost overruns and delays, and provide large power users with scalable options to meet growing demand. 

Additionally, SMRs require significantly less land than conventional nuclear plants, which already have one of the lowest direct land-use requirements of any electricity-generating technology. They also incorporate passive safety features, meaning they can function without human intervention or external power, in addition to being designed to withstand extreme events, including natural disasters. 

In the future, SMRs may also strengthen grid resilience by supporting  islanded operation and black-start functionality. Taken together, these attributes make a clear case for the increased deployment of SMRs.  

The awards destined for SMR deployment, announced on December 2, highlighted the two recipients selected for receiving the cost-shared federal funding:

The Tennessee Valley Authority (TVA) 

TVA will receive up to $400 million to accelerate the deployment of the GE Vernova Hitachi BWRX-300 SMR at the Clinch River Nuclear site in Tennessee, one of the few NRC-permitted, undeveloped nuclear sites in the country. The funding will also support plans to deploy additional units with Indiana Michigan Power and Elementl. 

The BWRX-300 is a boiling water reactor (BWR), a proven nuclear technology, which has been significantly simplified to reduce construction complexity, capital costs and project risk. Only one other BWRX-300 is currently under construction in Canada, which is expected to enter commercial operation in 2030. TVA’s project is among the leading candidates to become the first commercial light-water SMR to be deployed in the U.S. 

Holtec Government Services, LLC (Holtec) 

Holtec will receive up to $400 million to deploy two SMR-300 reactors at the Palisades Nuclear Generating Station site in Covert, Michigan. The site already possesses nuclear-trained workforce, transmission infrastructure and community familiarity with nuclear operations, all of which help reduce siting and development risk. 

Holtec’s SMR-300 is a pressurized water reactor (PWR) that builds on well-established light-water reactor technology while incorporating modern passive safety systems and modular construction features. 

The Generation III+ Small Modular Reactor (Gen III+ SMR) Pathway to Deployment Program aims to bridge the gap between today’s operating nuclear fleet and more advanced reactor concepts to be supported through DOE’s Advanced Reactor Demonstrations Program (ARDP). 

Rather than funding early-stage research, the Gen III+ SMR Program prioritizes reactors that leverage established, light-water nuclear technologies and have a credible pathway to licensing, financing and construction in the near-term. 

In addition to the initial $800 million awards, DOE has outlined a second funding tier of up to $100 million, yet to be awarded, that will focus on addressing gaps in design, licensing, supply chain, and site readiness.  

Strengthening the American nuclear sector is not only key to meeting the electricity needs of an advanced information economy, but is also a strategic imperative. As global electricity demand rises, competitors are racing to lock in influence through reactor deployment and exports.  

China and Russia have made nuclear energy an important pillar of their geopolitical strategy, accelerating the buildout of their domestic nuclear fleets while using exports to deepen their political and economic ties abroad. 

Russia is a leading player in nuclear exports through state-backed financing and turnkey projects, and has provided nuclear technology to Iran, Turkey, Egypt, India and Eastern Europe. Meanwhile, China is constructing dozens of reactors domestically and aggressively positioning itself as a nuclear exporter. It has exported technology to Pakistan and is pursuing projects across Africa, the Middle East, Central Asia and Latin America.  

Expanding domestic capacity for uranium enrichment is also strategically vital. Prior to the 2000s, the United States enriched most of the uranium used by its nuclear fleet. However, as low-cost Russian imports expanded and prolonged periods of inexpensive natural gas reduced incentives for domestic investment, U.S. enrichment capacity declined—leaving the United States increasingly reliant on foreign suppliers even as nuclear power continued to provide reliable, emissions-free electricity. Today, most enriched uranium used domestically is imported (Figure 2). 

Figure 2. Purchases of enrichment services by U.S. civilian nuclear power reactors by origin country, 2020-2024.  

Source: Author’s illustration based on data from the Energy Information Administration’s 2025 Uranium Marketing Annual Report (Table 16). Notes: (1) “Separative work units (SWU)” refer to the energy input needed to enrich uranium. Thus, the chart illustrates how much “separation work” is purchased as a service from different supplier nations. (2) The “Other” category may include China and other European nations; exact amounts undisclosed. 

Building out a robust domestic nuclear deployment pipeline alongside a reliable supply chain, including fuel and a skilled workforce, is essential to America’s ability to lead in global nuclear markets. A strong slate of U.S. projects enables American companies to offer reliable alternatives to state-backed competitors, like China and Russia, whose nuclear offerings often come bundled with opaque financing and long-term dependencies, as well as less stringent export conditions and transparency around safety and nonproliferation. 

Accelerating advanced nuclear deployment is not just about meeting domestic power demand. It is about whether the United States will shape the future of global nuclear energy—or allow China and Russia to do it instead. 

The nuclear industry is currently at a turning point. The policies implemented today will determine which nations take the lead over the next two decades, including whether the United States can rebuild a secure domestic nuclear fuel supply chain and deliver reliable, clean electricity to meet rapidly growing demand from data centers and advanced manufacturing. 

Recent DOE investments in near-term SMR deployment and domestic uranium enrichment directly advance both objectives. By helping projects move from licensing to construction while strengthening the nuclear fuel supply chain, these programs support U.S. energy security at home and position American companies to compete globally with technologies built to the highest standards of safety, transparency and nonproliferation. Sustaining and expanding this momentum will be critical to reestablishing American dominance in nuclear energy deployment, innovation and exports.