“Bipartisan support for commercial fission in Congress and the White House has opened the subsidy floodgates and, to an extent, reined-in overregulation. But the information of a free market where government is neutral is needed for the first time in the history of the industry.”
Free-market energy adherents are warned to not make commercial nuclear power (fission) the new government darling in place of wind, solar, and batteries. Instead, a free-market framework needs to be established to let the market decide with government neutral.
Special government favor created this peacetime industry in the 1950s, and its heralded promise never eventualized since. At the same time, turbine technology to generate electricity put fuel oil and natural gas into the game, providing much needed (fossil fuel) competition to coal. Wind and solar as grid electricity were nowhere through the 1960s and into the 1970s.
My study, Nuclear Power: A Free Market Approach (AIER: January 20, 2026), examines the history of the 70-year-old industry. The story is as much political as economics, and by any measure, nuclear power is the largest and most costly failure in U.S. energy history. In its simplest terms, nuclear fission is the most complicated, fraught, and expensive way to boil water to steam the turbines.
Too many on the free-market side consider commercial nuclear as the little engine that could have, with government overregulation being the problem. True, overregulation joined over-subsidization, but the latter set up the former. Take away both and nuclear power would not have been commercialized in the U.S. and probably elsewhere.
About the best that can be said is that nuclear is a successful failure. In Vaclav Smil’s words: “To whatever extent the technology can be termed a technological success, it is an economic failure.” In a world of competing ends to unlimited wants, this is a negative outcome.
Carte Blanche?
Nuclear is also a darling of the energy planners in and outside of academia. After all, nuclear fission is arguably the only mass-scale alternative to fossil fuel generation besides played-out, limited hydropower. But hope springs eternal with the ‘experts’ and would-be energy planners. The fire-ready-aim approach was forwarded by researchers at Columbia University’s Center on Global Energy Policy.
The United States needs to re-embrace nuclear energy and retake its role as a global leader in nuclear power technology…. Operationalizing a U.S. nuclear resurgence requires agreeing on an ambitious goal and working together to realize it. Just as Trump in his first term announced Operation Warp Speed to bring a COVID-19 vaccine to market, both parties should set aside partisan differences and back a Nuclear Operation Warp Speed with a target of building 20 gigawatts of new nuclear capacity by 2035.
The authors, Jason Bordoff, Ashley Finan, and Matt Bowen, refer to new proposed legislation, the International Nuclear Energy Act, intended to “to support the U.S. domestic nuclear energy industry’s leadership and offset China and Russia’s growing influence on international nuclear energy development.”
The bill’s sponsors were each quoted in a press release:
“If the U.S. doesn’t lead on nuclear energy development, Russia and China will. This bill will give us the tools we need to compete with these authoritarian aggressors and build long-lasting nuclear energy deals that benefit our economy and ensure America remains the leader on nuclear energy for generations to come,” said Chairman Risch.
“With the International Nuclear Energy Act, we’re not asking for a seat at the table—we’re setting the agenda on global nuclear development,” said Senator Lee. “Achieving American energy dominance will require us to streamline our nuclear exports, foster our relationships abroad, and bring the full weight of American industry to bear in out-competing our geopolitical adversaries. I’m grateful to partner with Senator Risch to ensure that America remains at the forefront of nuclear power for decades to come.”
“We need to counter Russia and China’s growing influence in nuclear energy development. That’s why I’m proud to cosponsor legislation that will boost America’s global energy dominance, unlock new partnerships and projects that will benefit American workers, and protect our national security,” said Senator Heinrich.
Government this-and-that is written all over the bill. In the words of its sponsors, the International Nuclear Energy Act would:
• Support the establishment of an office to coordinate civil nuclear exports strategy; establish financing relationships; promote regulatory harmonization; enhance safeguards and security; promote standardization of licensing framework; and create a nuclear exports working group.
• Create programs to facilitate international nuclear energy cooperation to develop financing relationships, training, education, market analysis, safety, security, safeguards and nuclear governance required for a civil nuclear program.
• Require a cabinet-level biennial summit focused on nuclear safety, security, and safeguards, and to enhance cooperative relationships between private industry and government.
• Establish a Strategic Infrastructure Fund Working Group to determine how to best structure a Fund to finance projects critical to national security.
Existing nuclear capacity, advantaged by sunk costs, can compete against new capacity from fossil fuels and from renewables. But for new nuclear capacity, the hoopla has not resulted in follow-through except in centrally planned economies where cost is not determining.
Energy expert Robert Bryce has described the gulf between aspiration and reality, with such talks and essays titled “The Nuclear Renaissance Isn’t What You Think” and “Nuclear Reality Check” and “Yes Nuclear. How Much, How Soon?” He, like many others, desperately wants competitive nuclear. But ….
Optimism and hyperbola about Small Nuclear Reactor (SMPs) pushed stock valuations high several years ago, followed by reality checks. A particularly hard month was in November of last year, when Oklo, NuScale Power, Terrestrial Energy, and Nano Nuclear Energy were significantly devalued. These stocks have not recovered. NuScale, for example, from a high of $57 per share a year ago is now trading below $8.00 per share.
Conclusion
Bipartisan support for commercial fission in Congress and the White House has opened the subsidy floodgates and, to an extent, reined-in overregulation. But the information of a free market where government is neutral is needed for the first time in the history of the industry. There is an off-ramp for self-regulation, as I forwarded in my primer from early this year.
In general, a free market approach to nuclear would entail
Ending governmental research and development in the field. Abolishing public grants and tax preferences for the industry. Halting foreign-loan guarantees. Repealing the Price-Anderson Act in order to privatize safety and insurance regulation. Lifting all antitrust constraints on industry collaboration. Making waste storage the responsibility of waste owners. Removing the Nuclear Regulatory Commission and the US Department of Energy from civilian nuclear policy.
And more specifically, involved parties can determine risk and a proven industry organization can replace the Nuclear Regulatory Commission on the ground.
And:
Investors and other financial stakeholders would judge reliance and safety, not Washington, DC. Radiation (such as the controversial linear no-threshold limit) and other standards would be determined by the parties informed by science. What would a judge or jury believe in this regard?
Free markets anyone?