Trump Takes the Nuclear Option
- SWS
- May 27
- 8 min read
Energy Policy Perspectives Vol. 7 - May 27, 2025
Enhanced and accelerated nuclear policies. On May 23, President Trump issued four new executive orders (EOs) broadly related to the advancement of new nuclear electricity generation technologies and related nuclear manufacturing, engineering, construction, development, and related nuclear fuel cycle infrastructure and supply chains as well as targeting the development of a future nuclear labor force.
EOs are broadly positive. Most of the Trump EOs related to energy contain broadly positive enhancements to national energy policy. The Friday EOs further expand on earlier EOs promoting an increase in U.S. energy production. Clearly, significant new nuclear electricity generation capacity will be required to support the U.S. electrification of industry and transportation, and to power data center and AI compute growth over the next several decades. The expediting of this new nuclear generation infrastructure and its related supply chains is essential incremental energy policy as the U.S. electricity supply grows increasingly constrained, dispatchable electricity generation is becoming dearer nationally, and the electricity demands of the digital industries are both large and more imminent. As seen on Friday, some nuclear generator, nuclear fuel processor, and new nuclear reactor technology developer stocks rose as much 30%. The reaction in the equity market appears overly optimistic given the realistic new nuclear deployment runway required. Also, as in most of the Trump energy executive orders, the policy appears constructive for nuclear generation and related companies/industries, but how the policy may be executed raised some concerns for us.
EOs clearly driven by AI ambitions. While the Trump administration has shown a clear preference for dispatchable power sources and a general disdain for intermittent electricity generation technologies in its EOs to-date, the DeepSeek event has clearly remained on the administration’s radar as a national security and AI development issue. Much of the motivation behind the nuclear EOs on Friday is clearly motivated by strategic U.S. AI technology development concerns and the power supply constraints thereof that could prevent the “digital dominance” of the U.S.
New nuclear generation capacity. The general intent of the nuclear EOs appears to be to significantly accelerate the expansion of the U.S. power supply available for AI technology development for both commercial and U.S. defense purposes. Thus, the focus of the new EOs is to accelerate the deployment of new nuclear generation technologies that would provide a significant increase in reliable dispatchable power generation capacity and production. While maintaining the administration’s support for fossil fuels, the EOs clearly foresee a critically important role for dispatchable nuclear generation resources.
Establishing a significantly enhanced nuclear supply chain. Beyond accelerating new nuclear generation deployment, much of the focus of the EOs relates to enhancing domestic nuclear supply chain development, particularly the entire nuclear fuel cycle. The most recent EOs expand on the March 20, “Immediate Measures to Increase American Mineral Production” executive order and the January 20 EOs.
EO #1. The first Trump EO titled “Reinvigorating the Nuclear Industrial Base” orders various departments to coordinate a report within 240 days that recommends new policies for the development and deployment of a modernized domestic nuclear fuel cycle (processing, enrichment, fabrication, recycling, re-processing, transportation, permanent waste disposal, etc.), the development of related U.S. industries and production capabilities, and radioactive waste disposal plans. The report is also to evaluate the reprocessing and recycling of spent nuclear fuel along with a permanent waste disposal strategy. The EO also orders the diversion of U.S. excess plutonium toward commercial nuclear energy fuel reprocessing. The EO targets the restart of retired reactors, the completion of halted nuclear reactors, the uprate by 5 megawatts at existing reactors, and the commencement of the construction of 10 new “large reactors” (we infer this actually means nuclear plants, not actual large reactors) by 2030. The EO imagines providing grant, loan, and other funding support for these efforts. Finally, the EO orders various government agencies to provide grants that accelerate nuclear career development programs while providing greater access to government research and development labs for educational purposes.
EO #2. The second EO, titled “Reforming Nuclear Reactor Testing at the Department of Energy” orders the Secretary of Energy to reform nuclear reactor testing policy at U.S. national laboratories over the next 60 days to promote new reactor testing with more explicit project application and review procedures due within 90 days that allow reactor testing applicants to be operational within 2 years. In some ways, the EO appears to be superseding the NRC for new reactor evaluation. The EO also orders the establishment of a pilot reactor testing program outside of the national lab structure, directing the Secretary of Energy to approve at least three reactor pilots with a “goal of achieving criticality in each of the three reactors by July 4, 2026.” We have to believe the use of the word “criticality” refers not to actual reactor operation, but pilot reactor application progress. To expedite reactor testing, the EO also orders the Secretary of Energy to develop rules that reform environmental compliance rules/regulations for the new test reactors by June 30. The intent here appears to be to utilize DOE environmental exclusions to exempt reactor testing from some environmental reviews.
EO #3. The third EO, titled “Ordering the Reform of the Nuclear Regulatory Commission” orders the reorganization of the NRC to “promote the expeditious processing of license applications and the adoption of innovative technology.” The EO also orders a broad reduction in NRC staffing while requiring new regulations to be drafted to execute the new policy directives. The EO orders the development of Notices of Proposed Rulemaking (NOPRs) related to a “wholesale revision” of FERC regulations and guidance within 9 months, with final rules/guidance due within 18 months. The EO suggests that the NRC has been too focused on extreme risk aversion and has not evaluated the alternative costs of generation in its analysis and has generally constrained new nuclear generation capacity deployment. The EO orders the establishment of a firm fixed application review deadline of 18 months for new reactors and one year for reactor life extension applications. The EO also requires the establishment of standardized applications for “high volume” microreactor and small modular reactor application reviews. The EO suggests a goal of increasing nuclear generation capacity from about 100 GW today to about 400 GW by 2050.
EO #4. The fourth EO, titled “Deploying Advanced Nuclear Reactor Technologies for National Security” orders the Secretary of Defense to establish a nuclear energy deployment program at U.S. military bases with the first reactor operational by September 30, 2028. The U.S. Army (which, unlike the U.S. Navy, has very limited nuclear experience) will operate and regulate the reactors. The Secretary of Defense is ordered to produce recommendations for the execution of the new policy within 240 days. The Secretary of Energy is also ordered to begin a process of designating AI data centers within the continental U.S. as “critical defense facilities, where appropriate.” This portion of the EO suggests that some AI data centers may be located at DOE sites. All of the associated electricity infrastructure would also be designated as “defense critical electrical infrastructure.” We have a lot of questions about what the implications of these designations may actually be. The EO orders the Secretary of Energy to designate at least one DOE site for the deployment of a new reactor technology and orders the Secretary to expedite the deployment of “privately funded” nuclear reactors at DOE sites for powering AI data/compute centers with a goal of operating the first reactor within 30 months. The EO further orders the Secretary of Defense and Secretary of Energy to expedite private nuclear fuel cycle facilities in a similar fashion.
Significant nuclear fuel/waste policy deviations. Contained within the new nuclear EOs are some fairly radical deviations from existing nuclear policy. The EOs call for the establishment of a spent nuclear fuel reprocessing and recycling industry as well as the establishment of a permanent spent nuclear fuel and radioactive waste depository, such as the terminated Yucca Mountain project, which does not exist today. A permanent spent nuclear fuel storage repository has been plagued for decades by state politics. While done internationally, spent fuel reprocessing has been a controversial issue in the U.S. due to nuclear weapons proliferation concerns and is not currently done in the U.S. commercially. While not explicitly addressed, the door for controversial breeder reactor technology deployment also appears to be left ajar in the EOs as advanced nuclear technology and due to its beneficial nuclear fuel cycle considerations.
Hasty EO execution. Despite some of the May 23 nuclear EOs being in development for some time, the EOs also appear to have been somewhat hastily cobbled together based on the numerous errors present in the texts. As we discuss in the following section, the hasty preparation of the EOs is somewhat troubling in terms of how the administration has developed a very aggressive nuclear deployment strategy with some very short periods of time anticipated for the actual deployment and construction of new nuclear reactors, and short periods allocated for the deliberation by various agencies to establish revised rules/regulations/policies as short as 30, 60, 90 days. The EOs suggest some naivete related to new nuclear development, safety regulations, and the complex systems involved. We hope that the processes and deadlines established in the EOs are less hastily executed.
Nuclear execution concerns related to EOs. As we have noted in prior Policy Perspectives discussions, some of President Trump’s EOs have presented very constructive energy policy enhancements. Increasing U.S. energy production and reducing system friction allowing for the quicker deployment of new energy technologies are laudable aims. The necessity for significant new electricity infrastructure and reducing the constraints on new electricity generation deployments are undeniably required today and essential enhanced policy objectives. However, there is a difference between expediting new nuclear generation processes more efficiently in the latest EOs and ordering and establishing untested, potentially very short development, construction, and safety review processes. The administration’s EOs have also sometimes presented conflicting objectives relative to enhancing U.S. energy infrastructure and energy supplies. For example, EOs under the Trump administration focused on supporting increased domestic crude oil production, while tariff actions have had negative implications on drilling economics and global demand, dampening oil production growth expectations. Also, on April 9, the administration issued the EO titled “Zero-Based Regulatory Budgeting to Unleash American Energy” which effectively orders the inserting of sunset provisions into major U.S. energy and environmental regulations related to such critical established U.S. law such as the Federal Power Act of 1935, the Natural Gas Act of 1938, the Atomic Energy Act of 1954, various Energy Policy acts, and the Endangered Species Act of 1973. While these efforts were intended to reduce regulatory costs and constraints that delay new energy technology deployments, with the government agency staffing reductions and the massive extent of the regulations requiring review suggests that the review of sunset provisions and the potential for extensive delays in those reviews could cause the triggering of some sunset provisions in the future that could cause compliance chaos for energy producers and unintended consequences in the future. We wonder what conflicts and unintended consequences may arise from Friday’s EOs.
The new nuclear EOs also contain numerous very aggressive deadlines for the deployment of new nuclear generation and new policies/regulations that could prove problematic. For example, the deadlines for new nuclear technology deployments in EO #4 of 2027 and 2028 appear beyond difficult to potentially dangerous, in our view. Given the complexity of the systems and risks involved, the difference between improving the expediency of new nuclear technology development and maintaining adequate reactor safety and environmental reviews perhaps represents a wide gap in the EOs. Considering that AI has been nearly 70 years in development (and counting) due to the complexity of the problem, the insistence on very short timelines for the completion of the full development and construction of new reactor technologies, and the completion of the relevant review processes for new nuclear reactors is likely unrealistic, in our opinion. Trying to fit the entire process of completing the first new reactors within the President’s term could prove to be unwise and counterproductive.
Too soon for extreme optimism. Big tech companies have shown a desire for not only reliable but clean/renewable energy. The influence of the AI developers in the EOs is fairly clear. In addition to the news about Big Tech’s PPA support for the restoration of some shuttered nuclear units, recent industry pledges from Big Tech have provided further support for deploying new nuclear energy (Amazon, Google sign pledge to support tripling of nuclear energy capacity by 2050). The increasing industry support for new nuclear power generation development is critical, in our view, as the technology is best positioned to provide reliable, baseload power given some of the limitations of hydropower and geothermal generation which both represent alternative renewable, clean and dispatchable energy generation sources. Industry financial support cues for the nuclear technology industries will help to speed technology development. The policy directives of the EOs to expedite new nuclear generation technology and supply chain deployments are a welcome next step in support for the nuclear industries and companies.
However, as we previously noted, the stock market reaction on Friday appeared a bit frothy. While nuclear-related industry participant stocks rallied substantially, new nuclear reactor technology deployment is not likely to be as quick as the EOs envision with the economic benefits accruing to the related companies taking a bit longer than the market imagined last week. Nuclear safety reviews have often taken over a decade to accomplish at the various government agencies and reducing the process to 18 months will be a tremendous challenge even if new nuclear reactor technology was fully developed and ready for licensing applications today. While the administration’s focus on improving the deployment and review processes for new nuclear infrastructure is a big step in the right direction, we suspect that the reform processes and policy adjustments to be executed by various government agencies, while those agencies are simultaneously reforming and reducing staffing themselves, may take a bit longer and prove more complicated than anticipated by the EOs issued last week.
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