Big Beautiful Bill Encourages Nuclear, But Regulations Still Don’t

The One Big Beautiful Bill (OBBB) Act recently passed by the US Congress accelerated the phasing out of many federal incentives like Investment Tax Credit and Production Tax Credit for renewable energy like wind and solar. At the same time, it retained incentives for nuclear energy (Sections 45U, 45Y and 48E) and expanded the loan guarantees and support programs under the Department of Energy. This is perhaps the biggest investment push toward nuclear after the Bipartisan Infrastructure Act and the Inflation Reduction Act of 2022. While this is a much-needed policy move, incentives and subsidies aren’t enough to truly build our nuclear energy ecosystem. The US needs to rethink its regulatory framework to build necessary infrastructure as well as invest into cutting-edge technologies if it is ever to become energy independent.

In our modern society, energy is like oxygen — invisible in its abundance and catastrophically obvious in its absence. A lot depends on it from day-to-day household workings, functioning of public infrastructure, prices of goods and supplies, national security and more. Hence, the goal of every country in the 21st century is to become “energy independent.” This has been an American dream, too, and nuclear power can be a catalyst.

In 1973, President Richard Nixon pledged allegiance to the goal of energy independence, following the Arab oil embargo with the goal to build 1000 nuclear power plants by the year 2000. The next administration continued on this path and reorganized the Energy Research and Development Administration intended specifically to accelerate nuclear energy development while addressing safety concerns through the creation of the separate Nuclear Regulatory Commission (NRC).

But the dream remained unfulfilled because of systemic regulatory obstacles. The NRC’s changing requirements during licensing and construction period, along with additional regulations under National Environmental Protection Act (NEPA), resulted in multiyear delays. The same happened during George W. Bush’s Nuclear Power 2010 program under which only two new reactors were built at Vogtle, seven years behind schedule and double the initial budget.

Reframing Policy, Regulation and Innovation

Today, there is a renewed interest in nuclear energy because of a steady rise in electricity demand to keep up our digital infrastructure. When you throw into the mix expansion of artificial intelligence data centers, smart manufacturing and electrification of industries, our power demand is projected to double or triple by 2028. Whether the goal for the future is “net zero” or “energy independence,” increasing the nuclear mix in our power portfolio is the only way toward a stable energy future. But we cannot begin to address the solutions of the future without addressing the failures of the past.

The OBBB Act of 2025 has established a comprehensive nuclear energy policy by modifying existing tax incentives, providing substantial funding for modernization and implementing Foreign Entity of Concern Restrictions to preserve national interest. It has maintained the nuclear power production credit for operational facilities as well as investment tax credits for any reactor design approved by NRC through construction permits and combined licenses. The Act also introduced a 10% energy community bonus credit for advanced nuclear facilities, further incentivizing deployment in nuclear experienced region. It has allocated substantial funding for military nuclear programs and infrastructure. However, since the OBBB was a budget bill passed through reconciliation, the policy tracks have remained budgetary. It did not have the scope to address the complex regulations and outdated standards of NRC that still stand in the way of our goal.

My co-author and I firmly believe that the future of energy is nuclear. However, between planning, land acquisition, meeting regulatory compliance and construction, it takes more than 20 years and tens of billions of dollars to build a legacy nuclear reactor, more so to place it in service.

The primary challenge with NRC regulations is that the majority of the standards were developed for legacy light-water reactors that create an unnecessary burden for next-gen reactor technologies like small modular reactors (SMRs) and microreactors. For example, SMRs are smaller, flexible and can be constructed on the factory floor and assembled elsewhere near power grids and by design safer. It doesn’t make sense for them to follow the same prolonged review processes as a legacy reactor.

The Nuclear Energy Innovation and Modernization Act of 2019 agency mandated NRC to complete its new regulatory framework for next-gen reactors by December of 2027. However, the attempt has not been very successful and has instead revealed the depth of institutional resistance to reform. The initial draft submitted by the agency in March 2023 was rejected by commissioners and sent back for extensive revision. The second draft still hasn’t reached consensus and is unlikely to meet its deadline.

Similarly, for NEPA reviews, the current framework requires extensive documentation, with environmental impact statements often exceeding 1,500 pages even for smaller projects. These reviews consume one-third of overall licensing resources at the NRC and can take anywhere between two to three years. Not all reactors pose the same risk profiles and shouldn’t require the same cookie-cutter, full-length review treatments.

Executive orders signed by US President Donald Trump have been the most aggressive NRC reform attempts in recent history, specifically in reducing licensing timelines and environmental safety reviews like linear no-threshold standards. However, many of these orders overlap with the Advance Act of 2024, passed with bipartisan support, creating more uncertainty within the agency.

Strategic and Visionary Policy Needed

Despite these incredibly chaotic scenarios, there is still scope for reform and advancement, but we need a comprehensive effort involving Congress, the NRC and businesses developing advanced reactor technologies.

First, our energy policy needs to be strategic and visionary, and it needs long-term investments whose return on investment cannot be fully realized in the short term. It is clear that we have bipartisan support in Congress for advancing nuclear technology. What we need, more than ever, is consensus and consistency is advancing these policies without creating unnecessary overlaps or overhauls. Beyond legislation, we also need considerable Congressional oversight on how NRC is translating policy framework into regulation that prioritizes safety without stifling progress. Congress must focus on management accountability, not just rule-making timelines.

Second, we need regulatory reforms in the near term (till mid 2030s) to support initial deployment of reactors and for the long term (after mid 2030s) for wide-scale deployment and advancing nuclear energy. To make it happen, we need a more practical two-tiered reform approach at the agency level.

• Tier 1: Immediate Regulatory Triage. This should focus on establishing separate licensing tracks for different reactor classes. Manufacturing licenses for factory-built microreactors should operate under expedited six-month timelines with standardized safety cases. SMRs referencing certified designs should follow 12-month licensing processes. Only first-of-a-kind large, advanced reactors should require the full current review process.
• Tier 2: Systematic Institutional Reform. This should focus on addressing the NRC’s organizational culture and workforce challenges that prevent efficient implementation of any regulatory framework. The agency suffers from chronic understaffing in advanced reactor expertise, over-reliance on contractors and risk-averse decision-making that defaults to extensive review processes. We need to fill these roles with experts who understand next-gen reactors. Many low-risk, repetitive processes should be automated to reduce timelines and paperwork. At the same time, we need a shift in attitude within the agency itself where efficiency is a goal, change is met with adaptability and forward-thinking, innovative initiatives are encouraged.

Nuclear Future: A Shared Dream

In the end, the nuclear dream is a dream of shared humanity. This is not a challenge any one person, or one company, or the government can tackle alone. Isolation amongst ourselves has never served us well when it comes to nuclear power. By bringing together researchers, scientists and engineers as well as policy experts from both private sector and government, we can share the burden and accelerate progress.