US to Own Nuclear Reactors Stemming From Japan’s $550 Billion Pledge

Article content

(Bloomberg) — The US government plans to buy and own as many as 10 new, large nuclear reactors that could be paid for using Japan’s $550 billion funding pledge, part of a push to meet surging demand for electricity.

Article content

The new details of the unusual arrangement were outlined Wednesday by Carl Coe, the Energy Department’s chief of staff, about the non-binding commitment made by Japan in October to fund $550 billion in US projects, including as much as $80 billion for the construction of new reactors made by Westinghouse Electric Co.

Article content

Article content

Article content

“The role of having the government involved in private markets is sacrosanct — you just don’t do it,” Coe said at an energy conference hosted by the Tennessee Advanced Energy Business Council. “But this is a national emergency.”

Article content

Article content

The Trump administration has sounded alarms bells about a shortage of electricity needed for energy-hungry data centers that power artificial intelligence and for a potential resurgence of domestic manufacturing.. On his first day in office, President Donald Trump declared an energy emergency, unlocking new domestic powers to fast-track pipelines, expand power grids and save struggling coal plants. 

Article content

It has been more than a decade since the US last broke ground on a large-scale nuclear power plant that came online. Most of America’s energy industry wrote off for dead the notoriously expensive projects after Southern Co., the last utility to build a new plant, went $16 billion over budget and seven years behind schedule building its Vogtle project.

Article content

Still, the AI boom has created new life for the big plants. Earlier this year, Xcel Chief Executive Officer Bob Frenzel raised the idea that the projects could come back in vogue.

Article content

Article content

It is still unclear whether the funding commitments made by Japan, announced last month as part of a trade deal framework with the US, will come to fruition. In all, Japan has agreed to invest some $332 billion for energy projects in the United States, according to the White House. That pledge, in addition to Westinghouse’s new AP1000 reactors, include a new breed of smaller nuclear reactors, as well new power plants, electric transmission projects and pipelines. 

Article content

The Trump administration’s energy ambitions include orders aimed at accelerating the construction of nuclear power plants and government funds to support the restart of shuttered nuclear plants. An executive order aims to get 10 large, conventional reactors under construction by 2030, a target the industry has said will be challenging, but possible.

Article content

Shares of Oklo Inc., a US developer of small modular reactors, rose on Wednesday following Coe’s statement. Its stock was up 6% at 1:57 pm in New York. Shares in Canadian uranium miner Cameco Corp. rose as much as 5.7% and were up 3.3% at 1:57 pm in New York. 

Article content

The Energy Department didn’t immediately respond to a request for more details. Coe, in his remarks at the conference, said lots of details remained to be decided, but expressed confidence the nuclear reactors would come through. 

Article content

“We’re trying to decide where to put them,” Coe said.

Article content

Article content

—With assistance from James Attwood.

Article content

(Updates with background on nuclear power and Japan’s investment pledge starting in paragraph 4.)

Article content