Holtec’s delayed IPO, falling small reactor stocks, and shaky data center demand suggest the nuclear boom is deflating, but real opportunities remain for targeted US expansion.

The decision by Holtec International to delay its initial public offering (IPO) is the canary in the coal mine of a leaking nuclear power bubble. 

Holtec’s CEO, Kris Singh, didn’t build his multifaceted empire chasing unprofitable or irrational exuberance. The company cited multiple economic and energy headwinds that caused it to change course, including rising interest rates and uncertainty about the future direction of artificial intelligence (AI).

That’s bad news for emerging reactor companies, and it reflects market uncertainty about the future role of nuclear energy if current AI models change course from a centralized US approach that requires large data centers to distributed models requiring less concentrated power. 

Data centers are projected to drive significant electricity growth in the United States. But they now face a persistent political backlash. People are worried about the impact on energy costs, the environment, and whether AI is an economic accelerator or killer. Without a data center explosion, US electricity demand will remain relatively flat, and new nuclear energy begins to look less attractive compared to other alternatives.

Why Nuclear Energy Must Look Beyond Data Centers

This uncertainty argues for reframing the nuclear energy value proposition away from an overdependence on data center power. 

In many ways, the Trump administration is well situated to lead this redirection. It has designated nuclear energy a national security technology, pursues energy domination as a core policy, understands the acute nuclear technology and market competition posed by China and Russia, and has instituted dramatic domestic policy changes to promote the fortunes of American nuclear energy. 

But it seems uninterested in building the sound policy and financial foundation that is necessary for success. Instead, it seems addicted to the relentless promotion of mostly marginal nuclear energy advancements that will not result in American nuclear superiority.

Why the US-South Korea Nuclear Deal Raises Questions

A good example of the administration’s fixation on hype is the high-profile announcement that South Korea will provide $120 billion for the construction of eight nuclear power plants in the United States. Six will be Westinghouse AP-1000s and two Korean APR-1400s. 

These funds supposedly will be matched to the $17.5 billion loan the US government has committed to finance the purchase of AP-1000 long lead items and the US government’s previously created strategic partnership with Westinghouse to provide $80 billion for the construction of 10 AP-1000s in America. 

This South Korea deal is in the ballpark of meeting the Trump administration’s goal of building 10 new AP-1000s in the United States, but it is very unlikely that any of these will be under construction by 2030 as the May 2025 executive order contemplates. There are just too many unanswered questions about the US-South Korea deal and how it will be implemented. 

Sites are not public. While the general locations for these reactors are to be on federal land in Ohio, Tennessee, South Carolina, and Kentucky, the sites were not named. It has been speculated that the former Department of Energy (DOE) nuclear sites in Paducah, Kentucky, and Piketon, Ohio, are targets. The Tennessee location could be on the territory managed by the Tennessee Valley Authority, and perhaps the South Carolina site will be Savannah River. But there is no confirmation of these guesses, and site assessment is a long and challenging process, complicated further by the need to provide assurance to a foreign partner.

Terms are uncertain. The Commerce Department fact sheet notes that “The parties will develop and announce individual projects separately as sites, schedules, and commercial terms are finalized.” This process could take years to complete and would likely extend well beyond the current administration. This deal is specifically linked to the Trump administration’s tariff agreement with South Korea, and the terms of that trade pact may change after the 2028 presidential election.

Politics are problematic. It will be politically controversial to build South Korean APR-1400 reactors in the United States over AP-1000s. The sites will be on federal property and the Trump executive orders were explicit about nuclear growth supporting American technology. There is a presumption that South Korean firms will provide the engineering, procurement, and construction (EPC) for all the reactors, and this makes sense based on past performance. But that will generate opposition if it fails to create American jobs, another stated Trump administration priority. There also is no commitment by US utilities to participate in this deal, raising questions about how the energy created by these reactors will be used.

Why Small Modular Reactor Companies Face Headwinds

While the South Korea deal raises questions about whether an established technology like the AP-1000 can be built at scale in the United States, these concerns are magnified when considering the case for smaller reactors. 

As public and investor support for data centers plummets, the prospect of startup nuclear companies emerging as AI powerhouses is receding. This year, fledgling small modular reactor (SMR) companies that have gone public have been punished by the market. The stock prices for Oklo and NuScale Power are down more than 50 percent for the year, X-energy is approaching a 60 percent decline, and NANO Nuclear Energy is down by about 40 percent. Fuel-related companies have not fared much better.

One ominous sign is that the hopeful nuclear spring that let a thousand paper reactors bloom seems to be transitioning to a winter of the survival of the fittest, as evidenced by a nasty social media spat between two reactor startup companies, each of which has generated glowing headlines but not much energy.

Another indicator of concern is that TerraPower has separated from its EPC contractor, Bechtel, on the construction of its 345-megawatt (MW) Natrium reactor in Wyoming. That plant has a construction permit, making it the first advanced reactor being built in the United States. But the reactor is still under Nuclear Regulatory Commission (NRC) operating license review. 

The target price of the reactor is $4 billion, but at least one estimate offers an 80 percent probability that it will cost over $9 billion. TerraPower has established several agreements with South Korean companies, but most significantly has signed a framework agreement with Hyundai Engineering and Construction (HDEC), under which it would be the EPC for up to eight additional Natrium reactors. Those reactors likely will be developed for Meta, under an agreement announced earlier this year. But HDEC also could be added as the EPC for the Wyoming plant in an effort to rein in the cost of construction for the first reactor and generate further savings in subsequent builds.

How a Change in Congress Could Shift US Nuclear Policy

A change in control of one or both houses of Congress could flip energy priorities. For the past decade, supporting the resurgence of American nuclear power has been a bipartisan priority. However, the sheer volume of Trump executive orders on nuclear energy, the aggressive stance of the administration and some reactor companies toward the NRC and its authority to regulate SMRs, and a $40 trillion national debt in a rising interest rate environment may begin to erode this cross-aisle camaraderie.

It also is likely that with subpoena power, a Democratic majority will lead invasive investigations into how federal dollars for nuclear startups were spent and what they created, or didn’t. In this regard, the Democrats will be happy to return the favor after the drubbing they took during the Republican congressional investigation into the federal loan default by the Solyndra solar panel company.

Then there’s a wildcard question of whether the White House, seeking to boost reactor fortunes, will reverse course on the ban on Russian nuclear fuel, as it did with diesel fuel. That likely will generate bipartisan political opposition.

Where the Real Opportunities for US Nuclear Energy Lie

While the nuclear power bubble seems to be commencing a correction and deflating excessive expectations, it is important to remember that there are concrete opportunities for targeted US nuclear energy expansion.

Westinghouse is creating an overseas order book for the AP-1000, with a commitment from Poland for three units, and other Central and Eastern European countries signing memoranda of agreement that could result in additional sales. The pending agreement with Saudi Arabia also could expand the Westinghouse order book by two additional reactors.

The power uprating of operating US reactors is accelerating and could add six to eight gigawatts (GW) to the grid in coming years. Related, the owner of the VC Summer reactor project in South Carolina is inching toward a restart of construction on two AP-1000s after it was shut down almost a decade ago for cost reasons. That would add over two GW of power.

The GE Vernova Hitachi (GVH) BWRX-300 is emerging as the SMR of choice in Organization for Economic Co-operation and Development (OECD) countries. It is under construction in Canada, has received a construction license in the United States, and is a key contender in European and Asian markets. And the US Department of Defense continues to steam ahead with new microreactors that could create a durable pathway for additional small reactor testing and deployment.

About the Author: Kenneth Luongo

Kenneth N. Luongo is a recognized innovator, entrepreneur, and leader in global nuclear energy and transnational security policy. He is the president and founder of the Partnership for Global Security (PGS). He has been a TEDx presenter, written over 100 articles, including in The New York Times and Foreign Affairs, and engaged extensively with global media, governments, and audiences around the world on nuclear energy and transnational security challenges and responses. He was formerly a senior advisor to the secretary of energy and a professional staff member on Capitol Hill.

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