U.S. Energy Department Allocates $800 Million to Advance Small Modular Nuclear Reactors
In a significant move to bolster the nation’s clean energy infrastructure, the U.S. Department of Energy (DOE) has awarded a total of $800 million in grants to support the development and deployment of small modular reactors (SMRs). This funding is divided equally between the Tennessee Valley Authority (TVA) and Holtec International, each receiving $400 million to construct advanced nuclear reactors utilizing existing fission technology.
Tennessee Valley Authority’s Initiative
The TVA plans to construct a 300-megawatt SMR designed by GE Vernova Hitachi in Tennessee. This project aims to enhance the region’s energy capacity while contributing to the reduction of carbon emissions. By adopting SMR technology, the TVA seeks to provide a reliable and sustainable power source that aligns with the nation’s clean energy objectives.
Holtec International’s Project
Holtec International is set to build two 300-megawatt SMRs in Michigan. These reactors are part of Holtec’s broader strategy to revitalize the nuclear energy sector by introducing more flexible and cost-effective solutions. The deployment of these SMRs is expected to create jobs, stimulate local economies, and provide a stable energy supply to meet growing demands.
The Rise of Small Modular Reactors
SMRs represent a new generation of nuclear reactors that are smaller in size and designed for modular construction. This approach offers several advantages over traditional large-scale reactors, including reduced construction times, lower initial capital investment, and enhanced safety features. The modular nature of SMRs allows for scalability, enabling energy providers to adjust capacity based on demand.
Generation III+ Reactor Designs
The reactors planned by both the TVA and Holtec are classified as Generation III+ designs. These are advanced versions of existing reactor models that have been refined to improve safety, efficiency, and cost-effectiveness. By downsizing to a modular format, the industry anticipates that mass production of components and standardized construction processes will lead to significant cost reductions and streamlined project timelines.
Current Status of SMRs
Despite the promising outlook, the deployment of SMRs is still in its early stages. According to the World Nuclear Association, only two small modular reactors are currently operational worldwide. This underscores the importance of continued investment and research to overcome technical and regulatory challenges associated with SMR technology.
Tech Industry’s Interest in Nuclear Power
The technology sector has shown increasing interest in nuclear power as a means to meet the escalating energy demands driven by advancements in artificial intelligence and data processing. Companies like Microsoft and Meta have entered into agreements to purchase nuclear-generated electricity, highlighting a trend towards integrating nuclear energy into corporate sustainability strategies.
Microsoft’s Partnership with Constellation Energy
In November 2025, the DOE announced a $1 billion loan to Constellation Energy to restart a nuclear reactor at Three Mile Island. Microsoft committed to purchasing all the electricity generated by this 835-megawatt power plant for two decades, demonstrating the tech giant’s commitment to securing clean and reliable energy sources.
Meta’s Agreement with Constellation Energy
Similarly, in June 2025, Meta entered into a multibillion-dollar deal with Constellation Energy to acquire the clean energy attributes of the Clinton Clean Energy Center, a 1.1-gigawatt nuclear power plant in Illinois. This agreement ensures the continued operation of the plant through 2047, aligning with Meta’s sustainability goals and supporting the broader adoption of nuclear energy.
Investment in Nuclear Startups
The renewed focus on nuclear energy has also spurred significant investments in nuclear startups. For instance, X-energy raised $700 million in a Series D funding round in November 2025 to advance its small modular reactor technology. This influx of capital reflects growing confidence in nuclear power as a viable solution to meet future energy needs.
Conclusion
The DOE’s allocation of $800 million in grants to the TVA and Holtec International marks a pivotal step in advancing small modular reactor technology in the United States. By supporting the development of these advanced reactors, the government aims to diversify the nation’s energy portfolio, reduce carbon emissions, and meet the increasing energy demands of various industries. The collaboration between public institutions and private companies underscores a collective commitment to fostering innovation and sustainability in the energy sector.
