The United States is experiencing a period of rapid growth in electricity demand, which is expected to continue for at least the next decade. This growth is driven by economic development and expanded electric use in various sectors. Electric vehicles, tech manufacturing and the expansion of data centers to power AI applications are major factors in the growth of electricity demand.

To support this, the US electricity grid is undergoing significant upgrades and modernization efforts. This is driven by factors like aging infrastructure, increasing demand, the need to integrate more renewable energy sources, and the desire to enhance resilience against extreme weather events. The Biden Administration allocated $1.5 billion towards four major transmission upgrades, and another $5 billion loan guarantee for a massive Midwestern power line project.

But as we survey the energy landscape in early 2025, a compelling case for nuclear expansion is emerging. With electricity demand projected to surge 9% by 2028 and potentially triple in the coming decades, we're facing a critical decision point for America's energy future.

Current Nuclear Landscape

My sense is if you mention nuclear power production to most Americans, they will immediately think of the disasters. Plant disasters at Fukushima, Chernobyl and, of course, Three Mile Island in Pennsylvania would cause people to believe we have shut down all or nearly all of our nuclear power plants. Right?

But the fact is the United States remains the world's largest producer of nuclear power, generating about 19% of the nation's electricity through its fleet of 94 reactors across 54 plants. However, with an average age of 42 years, most of these facilities are approaching the end of their original design life. The recent completion of Georgia's Vogtle Units 3 and 4 marks the first new reactors connected to the grid in over three decades.

In recent papers by the Nuclear Innovation Alliance (NIA) and E4 Carolinas, trade associations for energy companies, clear economic and environmental advantages can be found through the use of nuclear power to supply US electricity needs. Below are summaries of the major points.

The Economic Case

Nuclear power delivers compelling economic benefits that extend beyond electricity generation. The industry directly employs over 73,000 workers and contributes $63.8 billion to GDP annually. Nuclear plant jobs typically offer salaries 50% higher than other power generation sources.

Modern reactors are less expensive and faster to construct. Advanced reactor designs were developed with a specific focus on cost-competitiveness and reducing construction complexity and risk compared to conventional nuclear plants.

Advanced reactor designs feature smaller physical footprints than conventional plants and emphasize the use of manufactured components to reduce the amount of on-site construction. Advanced reactors are designed for modular construction with reduced capital investment, and less construction complexity. This enables faster construction and scalable, incremental power additions to meet energy demand as needed.

Reliability Advantages

Nuclear plants operate at maximum power more than 92% of the time, nearly double the reliability of natural gas and coal, and triple that of wind and solar. This consistent baseload generation is crucial for grid stability.

Unlike renewable sources, nuclear power operates 24/7 regardless of weather conditions, making it an essential complement to intermittent renewable energy.

Most advanced nuclear reactors are also expected to operate between 60-80 years or more. In comparison, wind and solar energy sources are anticipated to operate on average between 30 and 40 years.

Low Carbon Footprint

Including nuclear power gives the best chance to tackle climate change. Princeton University’s Net Zero America study analyzed the ability and affordability of five distinct technological pathways, all using technologies known today, to decarbonize the United States’ economy. Out of the five pathways, all but one used nuclear energy and the pathway which used the largest amount of nuclear energy was also the most affordable.

Challenges to Address

The path forward isn't without obstacles. Recent projects have faced significant hurdles.

Plant Vogtle, a nuclear power plant in Waynesboro, Georgia, is the largest source of clean energy in the U.S. following the addition of two new reactors, according to Georgia Power.

The plant’s unit 4 reactor began commercial operations in April and unit 3 went online last year. They are the first reactors built from scratch and connected to the grid in over three decades and together can power over a million homes and businesses, according to the utility provider.

But the project ran seven years behind schedule and material costs rose. The two new reactors were initially budgeted at $14 billion, but that price tag more than doubled. The project also ran seven years behind schedule.

Even with the use of simplified advanced reactor designs, other factors will slow plant construction. Regulatory requirements and plant licensing processes are complex and time consuming. A skilled workforce in nuclear plant construction and operation is also limited.

Policy Momentum

Recent developments signal growing support for nuclear expansion. The Inflation Reduction Act provides crucial investment and tax incentives for both existing and new nuclear development. Multiple states have lifted historical bans on nuclear development, including West Virginia, Illinois and Wisconsin.

Tech giants like Google, Amazon and Microsoft are actively pursuing nuclear power agreements to meet their energy needs. For instance, Constellation Energy announced that its Unit 1 reactor at Three Mile Island, which closed in 2019, is expected to be revived in 2028, dependent on Nuclear Regulatory Commission approval. Microsoft will purchase the carbon-free energy produced from it to power its data centers to support artificial intelligence initiatives.

The Path Forward

To successfully expand nuclear capacity, the United States must:

• Streamline regulatory processes while maintaining safety standards
• Invest in workforce development and training
• Support the development of advanced reactor technologies, including small modular reactors
• Strengthen public-private partnerships to manage construction costs

For investors watching this sector, the convergence of policy support, technological advancement and market demand creates an intriguing opportunity set. While near-term volatility is likely, the fundamental drivers for nuclear expansion appear stronger than they have been in decades.

The need for expanded nuclear power generation has never been more urgent. With electricity demand soaring and the imperative to decarbonize our energy system, nuclear power represents a proven, reliable solution that supports both our economic and environmental goals.

President Trump has an opportunity to leave a legacy of economic growth, innovation and energy resilience. This effort would not only solve the power reliability crisis but also position the U.S. as a global leader in the energy technologies of the future.

The time for action is now – our energy security and economic competitiveness depend on it.

 

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