A longer version of this article was published by The Center for the National Interest and it can be found here.
The hope that new nuclear energy can be quickly synced with rapidly expanding artificial intelligence (AI) data centers is currently running out of phase with reality.
The data center explosion is the most recent driver of the “nuclear power renaissance,” and there is a convincing case for its value to these power-hungry plants. Reactors can provide steady energy for decades and supplement current energy supplies that data centers will pressure.
The Trump nuclear executive orders (EOs) are designed to accelerate the nuclear deployment timeline to match new nuclear technologies with market demand. But that set of policy initiatives is not enough to catch an AI wave that is rapidly building into a tsunami.
There are substantial headwinds to success posed by reactor uncertainty, deployment costs, supply chain gaps, an inadequate workforce, and regulatory hurdles. Then there’s the ever-looming competition from Russia and China and their government-centric offerings.
Overcoming these challenges requires a strategic package of public-led and private sector implemented financial, regulatory, and policy responses. This should include cooperation with strong nuclear power partners like South Korea and Japan, as well as non-traditional nuclear power allies such as the United Arab Emirates which could provide financing. This package is something that the United States and its allies have been incapable of delivering so far but it is necessary for success.
Powering the Artificial Intelligence Eruption
At the beginning of 2024, there were over 10,000 data centers worldwide, with over half in the United States (5,388). A Deloitte Research Center analysis predicts that US data center power requirements could rise to 176 gigawatts (GW) by 2035, up from 33 GW in 2024.
A multitude of massive data center projects are under development by America’s largest tech companies, including Amazon, Open AI, Meta, Google, and Microsoft. But most are slated to run primarily on natural gas despite the investment these companies have made in start-up nuclear power companies.
Many of the next-gen reactors reside on a drawing board, are wading through the licensing process, and are at least a decade from deployment.
Westinghouse has announced its intention to build ten new reactors in the U.S. That is in line with the president’s EOs. But with a start date of 2030, which is five years from now, and a 10-year construction time, they may be too late for this wave of the AI boom.
Existing large reactors can provide some nuclear juice for data center expansion in the short term, especially through the relicensing and uprating of operating plants and the resurrection of mothballed reactors.
For example, Three Mile Island Unit 1 is scheduled to be reopened in 2028 in support of Microsoft. The Palisades nuclear plant in Michigan will also reopen with support from a loan guarantee from the US government. And NextEra Energy is seeking to restart the Duane Arnold Energy Center in Iowa.
The Trump EOs aim for five GW of growth from existing reactors through uprating the power output, and the Nuclear Regulatory Commission (NRC) is anticipating 30 power uprate applications through 2030.
Creating a Strategy & Package
While the scope of the Trump nuclear policy directives is very substantial, their sheer density make it difficult to discern if there is a strategy in them designed to shake the foundations of nuclear business as usual.
If the plan primarily rests on hollowing out the Nuclear Regulatory Commission and relying on private sector financing, that is not a winning strategy for accelerating deployment.
The missing piece for both domestic and export deployment is the role of expanded government financing or loan guarantees along with the inclusion of a deep-pocketed sovereign wealth fund (like the UAE) that could provide bankrolling along with the U.S. and other allies.
The private sector will not be able to carry the burden of data center nuclear development and deployment without a strong government partner. That is the package that has been used very successfully by Russia and China.
The administration has done a commendable job of identifying its nuclear objectives and the component elements that are required to meet them. What it hasn’t done is create the strategy and financial incentives package that will allow it to successfully meet the artificial intelligence opportunity.
Sustaining a data center-nuclear deployment disconnect could crater American nuclear competitiveness and drive the renaissance to ruin.
Ken Luongo, President, Partnership for Global Security
