The major American presidential candidates should be talking more about energy. As JP Morgan notes in a recent research report (italics by me):

Electrification continues at an extraordinary pace across the economy, with autos, data centers and other uses driving increased demand for both renewables and fossil fuels. What was unthinkable just a few months ago has become reality – just look at the proposed restart of the storied Three Mile Island nuclear power plant.

Now I’m not sure that President Joe Biden pledging to sign the Building Chips in America Act—which aims to streamline the approval process for semiconductor projects under the National Environmental Policy Act (NEPA)—qualifies as “unthinkable.” But the decision does seem to be a notable change of direction for an administration that back in 2022 reinstated key NEPA protections involving major infrastructure projects, reversing Trump-era deregulation efforts. As with the Three Mile Island (TMI) news, AI is playing a key role here, given that the ability to manufacture advanced chips is a crucial component of the AI revolution.

Let’s take a step back: The decline of nuclear energy and the rise of NEPA play significant roles in the story of what I term the “Great Downshift,” the profound slowdown in technological innovation and labor productivity since the early 1970s, marking the end of America’s postwar boom and the start of economic stagnation. Nuclear energy, once seen as a promising source of abundant, pollution-free power, was hindered by increasing regulatory scrutiny and public anxiety, especially after the partial meltdown at Three Mile Island in 1979. Simultaneously, NEPA imposed lengthy environmental review processes, which often delayed critical infrastructure and energy projects. Together, these forces contributed to a broader cultural shift toward caution and risk aversion.

My positive case for change, as outlined in my 2023 book The Conservative Futurist: How to Create the Sci-Fi World We Were Promised, is that the need for clean energy and the need to outcompete China would provide tailwinds for pro-progress or “up wing” change. And that’s what seems to be happening as the need for clean energy to power AI and the need to stay ahead of China in the AI race are providing catalysts for progress, including a re-embrace of nuclear and much-needed regulatory reform.

But more needs to be done, including additional NEPA reforms (if not its elimination). And the nuclear revival is hardly a full renaissance yet. As Bloomberg energy columnist Liam Denning notes, Big Tech’s interest in nuclear power for data centers faces significant hurdles. While restarting old plants like TMI is viable, new nuclear projects remain hampered by high costs and long timelines. Expect tech giants to continue funding nuclear research, he says, including small modular reactors and fusion, while also exploring options such as efficiency improvements, natural gas contracts, and carbon capture technologies. That, even as renewable energy sources and battery storage gain market share, competing with nuclear. 

Denning concludes:

This is not to say no new reactors will be built at all. The combination of national security concerns and Big Tech’s balance sheet provides the best shot in a generation. In addition, federal support has amped up — indeed, roughly half the estimated profits for Constellation on the Three Mile Island deal will consist of tax credits. That same support, however, reflects the challenge in persuading private money to take on the pricing and timing risks of new reactors. Nuclear enthusiasts can pocket the victory and bask in the symbolism. Much else must go right for a renaissance to take hold.

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