AI’s Insatiable Appetite: A Second Chance for Nuclear and Coal?
The world is abuzz with the transformative power of Artificial Intelligence, yet its immense capabilities come with an equally immense and growing energy appetite. This voracious demand is now offering a surprising lifeline to energy sources once deemed to be on a path to obsolescence: nuclear and coal. It’s a dramatic pivot, echoing a similar, largely unsuccessful attempt just a few years prior.
Cast your mind back to 2017. The Trump administration, newly in office, sought to bolster struggling coal-fired and nuclear power plants with billions in taxpayer-funded subsidies. Facing increasing price pressures from cheaper natural gas and rapidly expanding renewables, these efforts largely faltered. In subsequent years, the nuclear industry continued to face roadblocks, with three plants shutting down since 2020. Coal, meanwhile, continued its long decline, its share of the US power mix plummeting from a high of 45 percent in 2010 to a mere 17 percent.
Nuclear’s Rocky Road and Renewed Hope
Fast forward to 2025, and the narrative has shifted dramatically. The Trump administration is not just promoting nuclear, but specifically positioning it as the indispensable solution to AI’s voracious energy needs. May saw a flurry of executive orders, including a directive for 10 new large reactors to be constructed by 2030. A pilot program at the Department of Energy, created as a result of these orders and coupled with a significant reshuffling of the country’s nuclear regulator, has already spurred breakthroughs from smaller startups. Energy Secretary Chris Wright declared in September that AI’s progress “will be accelerated by rapidly unlocking and deploying commercial nuclear power.”
Tech giants are mirroring this governmental push with substantial investments. Companies like Google, Amazon, and Microsoft have inked numerous deals in recent years with nuclear firms to power their burgeoning data centers. Microsoft even joined the World Nuclear Association and is notably backing the high-profile restart of the infamous Three Mile Island, an endeavor supported by a $1 billion loan from the federal government. Public support for nuclear power, currently at its highest since 2010, further emboldens this dual public-private sector drive.
Enduring Hurdles for Nuclear
Despite the renewed enthusiasm, the practicalities of nuclear energy continue to cast a long shadow over its future. The primary cost driver isn’t onerous regulations, but the sheer expense and complexity of construction. Critics voice skepticism over potentially inflated valuations for small modular reactor (SMR) companies, particularly those with strong ties to the current administration. An $80 billion deal the government struck with reactor giant Westinghouse in October remains light on details, raising more questions than answers for the industry. And while high-profile tech deals promise rapid deployment, the timelines for bringing reactors online consistently prove challenging.
Yet, insiders see this year as a pivotal moment. “Nuclear technology has been seen by proponents as the neglected and unjustly villainized hero of the energy world,” notes Brett Rampal, a nuclear power expert who advises investors. “Now, full-throated support from the president, Congress, tech companies, and the common person feels like generational restitution and a return to meritocracy.”
Coal’s Unexpected Lifeline
Nuclear isn’t the only beneficiary of AI’s energy demands. In April, President Trump signed a series of executive orders to boost US coal to power AI, with Secretary Wright subsequently issuing emergency orders to keep two plants, previously slated for retirement, online. The administration has also moved to ease pollution regulations, making it simpler to operate coal facilities. These concerted efforts, combined with AI’s seemingly endless energy appetite, have extended a lifeline to coal: more than two dozen generating units across the country, separate from Wright’s order, that were scheduled to retire are now staying online, some receiving years-long reprieves.
The Lingering Shadow of Coal
However, a complete recovery for the coal industry remains highly uncertain. A recent analysis of the US power sector reveals that almost all of the 10 largest utilities in the US are significantly slashing their reliance on coal, often looking to replace coal-fired power with more nuclear. A major impediment for coal is its persistent public relations problem. The technology of the future, after all, isn’t meant to pollute the air and drive global temperatures up. While AI’s energy footprint has significantly set Big Tech back from its stated climate-change goals, these companies are theoretically still committed to not ‘frying the planet’. And while tech giants are scrambling to align their energy needs with sustainability goals, coal’s environmental baggage presents a stark contrast, making its long-term viability in an AI-driven future a contentious debate.
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