Billions Flow to US Nuclear Sector With Payoff Still Years Away

eh}95maynjnf3svfcdb}oal2_media_dl_1.png Bloomberg Intelligence

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(Bloomberg) — After a generation of stagnation, interest in US nuclear energy is sky high, thanks to artificial intelligence’s voracious energy needs. Nuclear companies are stock market darlings, and the Trump administration recently unveiled an $80 billion-plus commitment to help fund new reactors.

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There’s just one problem: Hardly anything will be ready to to plug in for a decade.

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In theory, $80 billion can buy enough reactors to power all of Virginia’s Data Center Alley. In reality, traditional reactors take 10 years or more to build, while a highly anticipated wave of small, modular reactors has yet to produce commercial power. That means the only plants that will go into service anytime soon are a handful of shuttered facilities that can be restarted.

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“There’s a lot going on, and nothing is going on,” said BloombergNEF’s head nuclear analyst Chris Gadomski.

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That dissonance underscores how radically, and rapidly, the US energy system has transformed in recent years. Not long ago, utilities were shutting down costly nuclear plants and replacing them with cheaper natural gas-fired and renewable plants. The AI boom has since supercharged electricity consumption, straining power supplies and driving up prices. But while nuclear is suddenly in demand again, logistics and technology constraints threaten to thwart development even with President Donald Trump’s moves to streamline permitting and commit billions of dollars in funding.

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It’s possible the nuclear industry can meet Trump’s goal of starting construction on 10 big nuclear reactors by 2030. But there won’t be a lot of wiggle room, said Wyatt Hartley, head of North American asset management for Brookfield Asset Management Ltd. The company is emerging as a key player in the industry, in part because it’s the majority owner of Westinghouse Electric Co., which is expected to be a key beneficiary of the $80 billion reactor deal announced last month.

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“Nothing in nuclear happens overnight,” said Jeffrey Merrifield, a former commissioner with the Nuclear Regulatory Commission.

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Besides permitting, developers must line up buyers for the power and hire thousands of skilled workers. And some of the most critical components of a plant, such as reactor vessels and steam generators, can take as long as four years to manufacture and deliver.

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Hartley expects some of those orders to be placed “in the very near term” but, realistically, it will take 10 years to get just two plants up and running.

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Until then, some reactor developers are relying on natural gas. Fermi Inc., an energy real estate investment trust co-founded by former Energy Secretary Rick Perry that is developing a massive data center in Texas, placed orders for reactor components last month, but doesn’t expect them to go into service until the early 2030s. Start-ups Blue Energy Global Inc. and First American Nuclear Co. also expect their reactors to be completed next decade. All three companies are installing gas systems to supply data center customers as soon as possible.