Trade Deals and a New Chapter for American Nuclear

Critical Questions by Ray Cai, Jane Nakano, and Joseph Majkut

Published November 7, 2025

Last week, the White House unveiled new details of the $550 billion U.S.-Japan investment agreement reached earlier this year, which commits significant capital to U.S. energy technologies, including nuclear reactors, power plant and grid components, and critical minerals. At the same time, the administration announced an $80 billion partnership with nuclear manufacturer Westinghouse Electric Company to help build a fleet of new reactors in the United States. The White House indicated that some of the U.S.-Japan investment commitment would be directed to the Westinghouse deal. Together, these new initiatives could amount to the most ambitious U.S. government action to support nuclear energy in decades-though key questions remain.

Q1: What's in these deals, and who's involved?

A1: The joint fact sheet released last week included up to $100 billion each for Westinghouse and GE Vernova Hitachi to construct nuclear reactors, $25 billion each for Bechtel and GE Vernona for power equipment and services, and another $25 billion for Carrier for cooling systems. NuScale and ENTRA1 were also mentioned in the joint fact sheet, though no specific dollar amount was designated. In total, Japan is expected to invest $550 billion before President Trump's term ends in 2029.

According to a memorandum of understanding released in September, investments under the U.S.-Japan trade agreement will be selected by the U.S. president, who will establish an investment committee-chaired by the secretary of commerce-to recommend and oversee funding decisions. A new U.S. Investment Accelerator, housed in the Commerce Department, will manage and administer these investments, with each project operating through a special purpose vehicle (SPV) governed by the United States or its designees.

Once a project has been proposed, Japan has 45 days to review and transfer the related funds to the investment accelerator in U.S. dollars. If it declines to fund all or part of the project, the United States can impose tariffs on Japanese imports. To facilitate the deal, Japan will create a Strategic Investment Facility (SIF) under the Japan Bank for International Cooperation (JBIC). The SIF will be active through March 2029 and draw from three funding sources: dollar-denominated bonds issued by JBIC, yen-denominated government loans to JBIC, and allocations from Japan's foreign exchange reserves.

Investment returns will initially be split 50/50 until Japan recoups its investment, after which 90 percent will go to the United States and 10 percent to Japan. The U.S. government will facilitate projects by providing federal land, access to water and power, offtake agreements, and expedited regulatory approvals, while giving Japanese firms priority as suppliers where feasible. The deal expects private financial institutions to be involved in providing funding, likely with the assistance of loan guarantees facilitated by Nippon Export and Investment Insurance (NEXI), Japan's export credit agency.

For the Westinghouse partnership, the Trump administration will similarly help facilitate financing, land acquisition and permitting, and international business development to support the construction of either about eight AP1000 reactors or a mix of large and small modular units. In return, Brookfield and Cameco-owners of Westinghouse-have entitled the U.S. government to 20 percent of future Westinghouse profits in excess of $17.5 billion; alternatively, if the company's valuation surpasses $30 billion by 2029, the government could require it to go public and receive an up to 20 percent equity stake.

Q2: Why are the deals significant?

A2: These deals mark another step in the Trump administration's efforts to advance its stated priorities of strengthening U.S. nuclear and rebalancing trade. The administration had already pushed for building 10 new AP1000s as part of a "nuclear renaissance" to foster AI competitiveness and economic growth. They also echo a pattern seen earlier this year-with MP Materials and Lithium Americas-of Washington taking direct equity positions in private businesses it deems to be of strategic importance or needing government support.

With the One Big Beautiful Bill Act (OBBBA) largely retaining Inflation Reduction Act tax credits and Department of Energy (DOE) loan authority for nuclear, policy mechanisms were already in place to support new builds. These new deals have the potential to facilitate the missing private capital and supply chain investments needed to form concrete order books.

This could provide a crucial boost to the U.S. nuclear industry, where construction has been largely stagnant for decades. Plant Vogtle, the country's only recent domestic new build, came online seven years late and nearly $17 billion over budget. Although a dozen new projects and four restarts are now in various stages of development (see CSIS dashboard), the pipeline remains shaky as financing and cost challenges continue to loom large.

Q3: How might the promised funding actually be used, and what remains unclear?

A3: Few details have been released about how the new investments will be deployed. Industry analysts and stakeholders have welcomed the announcements, but stress that key questions remain unanswered, particularly regarding the mechanisms and legal authorities that will channel the committed investments. Early reporting suggests that some portion of the funding could support the VC Summer restart in South Carolina, which was recently awarded to Brookfield.

The scope and structure of the planned investments remain to be seen. For the Westinghouse deal, it is not yet clear which stakeholders will receive funding or how the $80 billion commitment will be allocated across different stages of project development. Uncertainty extends to the channels of disbursement and the legal authorities under which the funding will be spent.

Previous federal nuclear financing-such as the $12 billion in loan guarantees for Plant Vogtle-was provided through the DOE Loan Programs Office (LPO) to local utilities and municipal power agencies under Title XVII (Section 1703 and 1706) of the Energy Policy Act of 2005. Analysts, however, have noted that investment structures under the new deals could be "radically different" than these earlier LPO transactions.

Q4: Who's missing from the deal, and what gaps remain?

A4: Thus far, the announced partnerships have revolved around service and equipment providers. But for the envisioned nuclear projects to materialize and succeed commercially, other key stakeholders still need to be involved. Most importantly, offtakers-whether utilities, hyperscalers, or the federal government-will be crucial to anchor demand by committing to purchase the power generated.

Historically, many nuclear plants were built and owned jointly by regulated utilities or public power cooperatives, which could recover costs through their general rate base or by selling to specific offtakers. The Vogtle 3 and 4 reactors, for instance, were planned, designed, and owned by three Georgia providers, with a fourth (Southern Company) as the project's developer and operator.

Here, several pathways appear possible. The administration could channel support through direct loans or credit enhancements; it could also establish cost overrun insurance or construction contingencies. Other options include prepaid power purchase agreements and federal offtake backstops to provide early revenue certainty, or equity stakes at the project level. Similarly, the funding could also be funneled toward local workforce development, procurement, waste disposal, or other activities aimed at firming up the supply chain and enabling environments.

In practice, these mechanisms differ sharply across dimensions, including cost incidence and risk allocation, which will all weigh on how these investments translate into project outcomes. The administration will likely need to address how these dynamics affect upfront planning and regulatory approval from relevant agencies ranging from the State Public Utility Commissions to the Nuclear Regulatory Commission, which have been key pain points for nuclear projects.

Ray Cai is an associate fellow in the Energy Security and Climate Change Program at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Jane Nakano is a senior fellow in the Energy Security and Climate Change Program at CSIS. Joseph Majkut is director of the Energy Security and Climate Change Program at CSIS.

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