If the U.S. wishes to remain competitive, it should rely on its strengths.
China has invested massively in building a nearly insurmountable global lead in producing wind and solar energy, as well as batteries and the critical minerals for them. We should not be alarmed. Rather than enter a spending race trying to catch up, the U.S. should understand that China made the wrong choice.
Renewables are appropriate in some cases and uses — solar energy in Arizona, wind in Oklahoma, batteries for stabilizing the electric grid in Texas, etc. However, they simply cannot meet the surging electricity demand and needs of the future.
The International Energy Agency projects that electricity demand from data centers alone worldwide is set to more than double by 2030 (to an amount equivalent to slightly more than the entire electricity consumption of Japan today). Overall, demand is expected to increase by about 25 percent, driven by economic growth but also, more specifically, by the surge in data-processing and the climate-policy-related “electrification of everything.” As an example of the former (and there are plenty to choose from), Microsoft and OpenAI are planning a supercomputer campus that will require 5,000 megawatts of electricity. To put that in perspective, all of New York City has an average electricity need of 8,000 megawatts.
All this demand has one overarching need — stable electricity — to ensure continuous operation of the critical services that data centers provide and protect the sensitive IT equipment they contain. As matters stand today, the two best ways to produce this electricity are nuclear and natural gas, not least because, at least until storage technologies improve, renewables may weaken grid resilience once their share of electricity generated becomes “too” high. This concern will be heightened if it is shown that the recent widespread blackout in Spain and Portugal can be attributed in whole or in part to this factor. Blackouts such as these are devastating for data center operators.
China and the U.S. are fiercely competing for leadership in AI. Electricity supply will be key to that competition. While China has 30 nuclear plants under construction and aggressive plans to build more domestically and abroad, the U.S. nuclear sector retains some strong competitive advantages.
The U.S. currently produces more nuclear energy than any other country. We know how to do it, and many customers are eager to work with U.S. companies on nuclear energy. In addition, the Nuclear Regulatory Commission is regarded globally as the gold standard for nuclear regulators — hence, the NRC stamp of approval on a design is a good way to build public confidence.
We are also the largest producer of natural gas in the world.
Let’s go with our strengths. While nuclear power accounts for around one-fifth of the electricity generated in the U.S., it has been stuck at that level for decades; we could and should do more.
Wind, solar, and batteries have received massive subsidies. Let them get by on their own in the private sector. Government policy should focus on reforming regulation to get what is required — uninterruptible electric power that can best be supplied in the quantity needed by nuclear and natural gas.
The accident at Fukushima led Japan to shut down its nuclear plants for safety reviews, but they have slowly been reopened. Half a world away, Germany responded to the incident by doubling down on plans to phase out nuclear power, which it completed in 2023. As a result, Germany has faced increased energy costs (reinforced by its switch to renewables) and even greater vulnerability to blackmail by Russia. Recent opinion polls now show that a majority of Germans would favor a return to nuclear power, although only about a third would support building new plants.
France provides a contrast. After experiencing the 1973 oil embargo, it launched a massive expansion of its nuclear power program to ensure its energy security. To this day, France benefits from those decisions made decades ago. Nuclear provides 70 percent of its electricity. Earlier plans to reduce that portion to 50 percent have been abandoned, and a program to replace or upgrade aging nuclear plants is underway. Other European countries are following suit, with new plants under consideration in Czechia, the Netherlands, Sweden, and the U.K.
Finally, nuclear has a million-to-one energy density advantage over any other power source. (This means that a one-ounce nuclear fuel pellet produces as much energy as one ton of coal.) Former U.S. Senator Lamar Alexander, in a speech I heard him give, asked: If you have to go to war, would you rather go in a fast nuclear-powered attack submarine or a sailboat? I’m not talking about war here, but, in the race for energy security, similar considerations apply.