Westinghouse Electric got a leg up on its competition last week when the Trump administration announced a partnership with the nuclear giant to deploy $80 billion of new reactors.
The agreement is President Donald Trump’s latest move to influence the energy sector — namely, by giving the U.S. government equity in private ventures. The government would arrange financing and permits in return for a 20 percent stake in Westinghouse’s profits.
“They’re converting loan and grant programs into equity stakes,” said Brent Cebul, an associate professor of history at the University of Pennsylvania who researches political economy and business-state interaction. “That’s one way that we can think about this as both continuity with the Biden administration, but also an important precedent-setting disjuncture in terms of the equity stakes.”
As of October, the administration had taken stakes in five public companies, including semiconductor manufacturer Intel and rare earths miner MP Materials. Upon the Westinghouse announcement, ClearView Energy Partners said the “scale of the Trump Administration’s energy sector-directed industrial policy seems to be accelerating.”
“We would suggest the Administration may have identified Westinghouse as a possible ‘national champion’ within the U.S. power sector, which could influence the competitive landscape for domestic nuclear generation and energy operations writ large,” ClearView analysts wrote.
Jacopo Buongiorno, director of the Center for Advanced Nuclear Energy Systems at the Massachusetts Institute of Technology, said the deal indicates the government’s preference for Westinghouse as a purveyor of large, conventional nuclear reactors.
“It gives the perception that the government picked a winner, but it is the de facto winner in that category,” Buongiorno said.
Buongiorno noted that no other American nuclear firms are actively selling and building large reactors. While dozens of firms are looking to build midsize, small and micro reactors, he said, there are “other markets” for them.
“You have chemical plants; you have steel mills, concrete factories. They need heat and electricity, and maybe they need 100 megawatt equivalent of heat and 50 megawatt of electricity, or whatever it is,” Buongiorno said. “In that case, it doesn’t make any sense to put an AP1000. You put a small modular reactor.”
AP1000s produce roughly 1,000 megawatts of electricity, while small modular reactors generate anywhere from 12 MW to 300 MW. A typical Amazon data center consumes 300 to 500 MW.
Consulting firm Wood Mackenzie expects U.S. nuclear generation to grow 27 percent from 2035 to 2060 due largely to the proliferation of power-hungry artificial intelligence data centers. Many technology firms are turning specifically to nuclear to power their growing fleets in hopes that its low emissions will satisfy their sustainability goals without sacrificing reliability.
Westinghouse Electric’s owners, Cameco and Brookfield Asset Management, said in their announcement that the agreement with the U.S. government aims to boost the American nuclear industry, ensure energy sovereignty, support AI-driven data centers and potentially create thousands of jobs.
Under the new partnership, if the U.S. enters into agreements to build $80 billion of nuclear reactors, the government will receive 20 percent of profits “in excess of US$17.5 billion made by Westinghouse,” according to Cameco’s press release.
If the government makes a final investment decision by January 2029 and an initial public offering valuation for Westinghouse is expected at $30 billion or more, the government would be “entitled to require” an IPO. In that case, the U.S. would then have at least five years to purchase equity equal to 20 percent of Westinghouse’s value, after deducting the $17.5 billion.
Hazy details
The Trump administration’s pursuit of equity distinguishes its approach from previous instances of government ownership in private companies, such as during the New Deal and in the wake of World War II, Cebul said.
He also noted that in the 1980s and 1990s, states from Ohio to Arkansas set up public venture capital funds, pitching them as a way to create well-paying jobs.
In some instances, states reserved the right to participate in managerial decisions, Cebul said, but “I don’t know of any cases where the state actually stepped in to put their thumb on the scale.”
In the past, the U.S. government has also effectively created monopolies by awarding contracts to only one company. Cebul pointed to Boeing’s position in the aircraft industry and Lockheed Martin’s dominance in the defense sector as examples.
“Contracting is not the same thing as taking an equity stake, but it’s a distinction that is far more of a degree than a categorical difference,” Cebul said.
But much is still unknown about the deal with Westinghouse. Crucial details — such as sites, customers and builders — have not been publicly released.
“The announcement was very short on detail, and those details will have to be revealed soon for people to remain excited,” Buongiorno said.
ClearView analysts walked through the math of the IPO: At a $30 billion valuation, the agreement could let the government acquire a stake worth $6 billion by expending roughly $2.5 billion.
Funding sources aren’t specified. ClearView points to the Department of Energy’s loan-guarantee authority as a plausible tool to help arrange financing. The firm also highlights a new U.S.–Japan deal that sets aside up to $332 billion for critical energy infrastructure in the U.S., with a Japanese document sizing a Westinghouse provision at up to $100 billion.
ClearView estimated that $80 billion could support anywhere from 5 to 11 new reactors at 1 gigawatt each.
On its website, Westinghouse indicates that the new reactors could power more than AI: “Supporting America’s leadership in AI is a core use case, but the power produced will also meet broader increases in energy demand and bolster energy security.”
