The U.S. nuclear power sector is on the cusp of a significant transformation, driven by the insatiable appetite of data centers for reliable, low-carbon energy. With 94 commercial nuclear reactors generating 45% of the nation’s carbon-free electricity, these plants are increasingly seen as ideal partners for tech giants aiming to power their data centers with clean energy. This shift is not just about meeting climate goals; it’s about ensuring the grid can handle the growing demand for reliable electricity, especially as AI-enabled data centers proliferate.
Several technology companies have already announced plans to collaborate with nuclear developers, recognizing the long-term potential of nuclear power to meet their energy demands. Meanwhile, three companies with shuttered nuclear plants have notified the U.S. Nuclear Regulatory Commission (NRC) of their intentions to restart these facilities, which were previously closed for economic reasons. This resurgence is a clear indication of the changing dynamics in the energy sector, where the need for reliable, low-carbon power is outweighing economic concerns.
The federal government is taking notice. The Federal Energy Regulatory Commission (FERC) has been evaluating regulatory and policy issues related to the co-location of large loads with generating facilities. This includes addressing equitable cost allocation, potential grid impacts, and resource adequacy. FERC’s recent “show cause” proceeding in the PJM Interconnection region is a direct response to these trends, aiming to ensure that the grid can handle the increased demand from AI-enabled data centers.
FERC Chairman Mark Christie has emphasized the need to “get it right” when evaluating these issues, indicating that the status quo may not be sufficient. The importance of these issues has also been recognized more broadly within the executive branch and across party lines. President Biden’s executive order on “Advancing U.S. Leadership in AI Infrastructure” directed federal departments to lease sites for gigawatt-scale AI data centers and new zero or low-carbon power facilities, including nuclear reactors. This order underscores the federal government’s commitment to supporting the development of data center and energy infrastructure.
The current administration has also expressed its support for nuclear power. President Trump’s executive orders have directed agencies to review regulations that impose undue burdens on domestic energy resources, including nuclear energy. The establishment of the National Energy Dominance Council further highlights the administration’s focus on increasing America’s energy production, including the development of small modular nuclear reactors.
Integrating nuclear energy into operations allows companies to meet their carbon emission targets reliably and facilitates financing by providing a stable revenue stream. The nuclear industry sees the ability to serve large loads created by energy-intensive industries as a commercially justifiable reason to continue operating and expanding the current fleet of reactors. Small modular reactors and co-locating new projects with existing or mothballed nuclear facilities present viable options with lower up-front capital costs and quicker access to generation.
The NRC is also adapting to these changes, creating a new licensing pathway for advanced reactor technologies. The upcoming 10 CFR Part 53 rule, expected by the end of 2027, will provide a risk-informed, technology-inclusive licensing framework geared toward the next generation of reactor technologies. This regulatory evolution is crucial for supporting the growth of nuclear power in the U.S.
However, state laws may also come into play, potentially restricting or conditioning direct power sales under co-located generation arrangements. This could prevent independent developers from co-locating generation behind an existing customer meter, adding another layer of complexity to the regulatory landscape.
As these developments unfold, the nuclear power sector is poised for a renaissance. The collaboration between tech companies and nuclear developers, coupled with regulatory adaptations and federal support, could reshape the energy landscape. The coming years will be pivotal in determining how these trends play out and what they mean for the future of nuclear power in the U.S. The stakes are high, and the decisions made today will shape the energy sector for decades to come.
