Legislation seeks $9B boost for advanced nuclear

The proposal in House Resolution 8997 was developed by Rep. Chuck Fleischmann (R., Tenn.), chair of the Energy and Water Appropriations Subcommittee, though some Democrats criticized that most of the funding would be diverted from the Department of Energy Loan Programs Office.

Fleischmann argues the funding boost is needed for U.S. nuclear to help tap into a $740 billion international market opportunity for nuclear equipment and services over the next 10 years, citing estimates from the Commerce Department.

“To realize that, we have got to complete these nuclear demonstration projects,” he said. “If we don’t do this, in a few short years, we will be out of the game not only with our foes but with our friends.”

Opposition: Rep. Marcy Kaptur (D., Ohio), the top Democrat on the subcommittee, said she strongly supports nuclear energy but does not want to see a large cut to the Loan Programs Office, which supports deployment projects across a wide range of clean energy technologies.

That office currently has 175 active applications requesting approximately $250 billion, and the cuts would reduce at least $90 billion in available financing, including for advanced nuclear projects, Kaptur said. At the end of June, the DOE reported that advanced nuclear projects totaling almost $65 billion in loan applications had come in already or were expected to be submitted in the next 120 days.

“Instead of setting a reasonable nondefense allocation for this bill and finding a bipartisan path that would have allowed the nuclear reactor demonstration programs to be robustly funded in their own right, my colleagues in the majority see fit to wipe out $65 billion in potential nuclear project financing . . . while allocating only $8 billion in funding for the reactor demonstration programs,” Kaptur said. “That does not seem like a sensible trade to me.”

The committee did not adopt Kaptur’s proposed amendment to provide $1 billion for the nuclear demonstration projects and keep the other $8 billion as loan program funding.

A closer look: Some of the funding proposed in Fleischmann’s package would go to the two main projects in the DOE’s Advanced Reactor Demonstration Program—TerraPower’s Natrium and X-energy’s Xe-100. To date, ARDP has received $2.5 billion from the Infrastructure Investment and Jobs Act as well as funding via the annual appropriations process.

The committee expects the new money will be sufficient to complete the projects despite an increase in construction costs.

The Nuclear Regulatory Commission accepted TerraPower’s construction permit for review in May and expects X-energy’s to be submitted within the year. Both projects were originally slated to begin operations before 2028, but Natrium is now looking at 2030 deployment due to a lack of commercial HALEU fuel suppliers beyond Russia.

The remainder of the proposed nuclear-related funding would be earmarked for small modular reactor development, with the goal of quickly deploying the first unit. NuScale canceled plans in late 2023 to build an SMR plant because of concerns over its commercial viability. The DOE began funding that project in 2020. The department is still funding a light water–cooled SMR project by Holtec Government Services through the ARDP.

Congress created a new funding stream for SMRs in the final appropriations legislation for fiscal year 2024 by repurposing unspent funds from the Infrastructure Investment and Jobs Act. The DOE anticipates offering funding in two tiers:

• Tier 1 is dubbed the “first-mover team support,” and the Office of Clean Energy Demonstrations will manage awards. The program will provide up to $800 million for two first-mover teams of utility, reactor vendor, constructor, and end users or power offtakers committed to deploying a first plant while also facilitating a multireactor, Gen III+ SMR order book.
• Tier 2, the “fast follower deployment support,” managed by the Office of Nuclear Energy, will be eligible for up to $100 million in awards to help bridge key gaps that have hindered the domestic nuclear industry in areas such as design, licensing, supplier development, and site preparation.

The DOE anticipates opening applications for the SMR funds in late summer or fall.

The House Appropriations Committee said in the report accompanying its draft legislation for FY 2025 that the DOE is not moving fast enough, which “puts at risk near-term deployment of U.S. nuclear technology domestically and internationally.” The committee proposed allocating an additional $100 million for up to two U.S. nuclear design companies to complete grid-scale design of SMRs, on top of the funds that would be repurposed from the Loan Programs Office.

What’s next: The full House is expected to vote on appropriations before Congress breaks for their annual recess in August, and the Senate Appropriations Committee is expected release its own appropriations bill soon. Then the chambers will mark up the legislation and conference to arrive at a final package.

Quotable: “Opponents say that this bill’s reprioritization of funding will hinder clean energy. But let me be clear, nuclear energy is clean energy,” Fleischmann said. “Strong American leadership in new nuclear deployment is essential for a stable domestic electrical grid.”