Nuclear power will receive most of the money from the US Energy Department’s loan office as part of a government push to ensure new reactors are built quickly, Energy Secretary Chris Wright said in published comments.

Billions of dollars of equity financing capital will be matched in a maximum proportion of four-to-one with low-cost debt from the Loans Programme Office, CNBC reported, citing Wright’s speech Monday at a conference hosted by the American Nuclear Society in Washington, DC.

“We have significant lending authority at the loan program office,” CNBC quoted Wright as saying in his address. “By far the biggest use of those dollars will be for nuclear power plants — to get those first plants built.”

US President Donald Trump in May signed an executive order calling for the US to start building 10 new large reactors with complete designs by 2030. Last month, the Trump administration announced a strategic partnership with Westinghouse Electric, which Cameco (TSX: CCO; NYSE: CCJ) co-owns with Brookfield Asset Management, to accelerate the development of America’s nuclear power.

“When we leave office three years and three months from now, I want to see hopefully dozens of nuclear plants under construction,” CNBC quoted Wright as saying.

AI demand

Washington’s deal with Cameco and Brookfield envisions at least $80 billion of new nuclear reactors being built across the country using Westinghouse nuclear reactor technology. Once constructed, the reactors are expected to generate reliable and secure power, including for significant data centre and computer capacity that will drive the country’s growth in artificial intelligence.

The partnership with Washington is a “significant de-risking event” for reactor orders and the wider nuclear industry, BMO Capital Markets analyst Alexander Pearce said Nov. 5 in a note.

It represents “a key step in accelerating the potential roll-out” of new Westinghouse AP1000 reactors domestically and abroad, the analyst added. His base case now includes 31 new Westinghouse reactors being built globally by 2040, including 12 that are already under construction.

Several options exist in the US to facilitate the financing of Westinghouse reactors, including the Energy Department’s loan office, Cameco chief operating officer Grant Isaac said last week on a conference call.

Restart, upgrade

While no commercial nuclear reactors are being built in the US, companies such as Meta Platforms and Alphabet are investing billions of dollars to restart or upgrade old plants to meet the massive electricity demand generates by artificial intelligence data centers.

Nuclear construction in the US has been slow, with only three reactors completed this century. Nuclear plants typically have lengthy development and approval routes to production.

And while the industry has been plagued by cost overruns, public opinion appears to be warming to nuclear power’s low-emissions attributes – after decades of trepidation following accidents in Pennsylvania, Ukraine and Japan.

Cameco and Brookfield teamed up to buy Westinghouse in October 2022. The deal brought together Cameco’s expertise in the nuclear industry with Brookfield’s recognized position as one of the world’s largest investors in energy generation technologies.

Source: MINING.COM – Read More