US and South Korea Outline $120 Billion Deal to Build Eight Large Nuclear Reactors on American Soil

On September 30, the U.S. Department of Commerce and the South Korean government announced a $120 billion framework to construct eight large-scale nuclear reactors across the United States. The agreement, designated "Project Power," allocates $100 billion for overnight construction costs and reserves $20 billion for contingencies. It marks the largest single component of a broader strategic investment package designed to expand domestic energy infrastructure.[2][4]

The reactor fleet will blend American and South Korean technology, consisting of six Westinghouse AP1000 units and two Korea Hydro & Nuclear Power (KHNP) APR1400 units. Both models are gigawatt-scale pressurized water reactors, with the AP1000 offering 1,110 megawatts of capacity and the APR1400 providing 1,400 megawatts. This arrangement represents the first time a foreign-designed commercial reactor will be deployed on U.S. soil.[1][2]

To accelerate the manufacturing process, the two nations intend to transfer a $10 billion advance payment by the end of 2026. These funds are earmarked for long-lead items, such as reactor vessels and steam generators, which require years to fabricate. The early capital injection is intended to stabilize the supply chain before specific project sites and schedules are finalized.[2][3]

The nuclear framework operates within a larger $350 billion investment commitment South Korea made in late 2025 to secure exemptions from U.S. import tariffs. Alongside the reactor plan, the two countries confirmed "Project Star," a $22.3 billion natural gas power plant in Texas designed to supply electricity to artificial intelligence data centers. A third initiative, focused on liquefied natural gas in Alaska, remains under commercial review.[2][3]

Resolving intellectual property disputes

The inclusion of the APR1400 reactors resolves a persistent intellectual property dispute between Westinghouse and South Korean nuclear firms. The framework establishes a waiver that permits the deployment of the Korean units in the U.S., accompanied by a compensation package recognizing Westinghouse's underlying technology. Negotiations are also underway for South Korean companies to acquire a significant minority stake in Westinghouse.[1][4]

While the framework outlines the financial and technological structure, the physical footprint of the reactors remains unsettled. U.S. officials indicated the plants will be built on federal land, with specific regions already identified.[2][3]

“They are going in Ohio, they are going in Tennessee, they are going in South Carolina, and they are going in Kentucky,” Commerce Secretary Howard Lutnick stated during a September 30 briefing.[2]

The deployment will proceed in phases, beginning with two AP1000 reactors, followed by the two APR1400 units, and concluding with the remaining four AP1000s. The phased rollout strategy reflects a compromise between the two nations regarding technology deployment.[1]

Navigating regulatory and financial hurdles

Washington initially pushed for a fleet composed entirely of ten AP1000 reactors, aiming to maximize domestic manufacturing through Westinghouse. Seoul countered by advocating for its independently developed APR1400 model, seeking to leverage its own engineering capabilities and establish a foothold in the American market.[1][4]

The resulting eight-reactor split allows both countries to achieve their primary industrial objectives. By securing the first two construction slots, the AP1000 maintains its position as the baseline technology for the U.S. nuclear renaissance. Integrating the APR1400 into the second phase provides South Korea with a high-profile demonstration project, which officials expect will enhance confidence in the reactor model for future third-country exports.[1]

Developing these gigawatt-scale facilities requires navigating a complex regulatory environment. Although the U.S. Nuclear Regulatory Commission granted design certification to the APR1400 in 2019, each specific site will still require separate construction and operational permits. The regulatory timeline for these approvals will dictate when the Korean-designed units can actually break ground, adding a layer of scheduling uncertainty to the second phase.[2][4]

The scale of the $120 billion investment underscores the massive capital requirements of modern nuclear construction. The $20 billion contingency reserve is specifically structured to absorb the cost overruns that have historically plagued large reactor projects in the West. By locking in this financial cushion upfront, the framework attempts to reassure investors and supply chain partners that the projects will not stall due to budget shortfalls.[1][3]

Balancing immediate demand with long-term projects

Beyond the reactors themselves, the agreement signals a shift in how allied nations approach energy security and industrial policy. The $350 billion overarching investment package was originally conceived to shield the South Korean economy from proposed 25 percent import tariffs. By redirecting that capital into U.S. infrastructure, the two governments have effectively linked trade policy directly to the expansion of low-carbon power generation.[3]

The Texas gas plant, known as Project Star, illustrates the immediate industrial demand driving these energy investments. The 6,472-megawatt combined-cycle facility in Encinal is slated to cost $22.3 billion and will supply power directly to co-located artificial intelligence data centers. The first phase of gas turbine generation is scheduled to begin in 2029, providing a faster return on investment while the nuclear projects navigate their longer development cycles.[3]

The third component of the investment package, Project North, highlights the ongoing negotiations over commercial viability. The proposed $50 billion liquefied natural gas project would transport gas from northern Alaska to southern export terminals via a 1,300-kilometer pipeline. However, South Korean officials have publicly stated that this initiative remains under review and will only proceed if the commercial assessments prove favorable.[2]

For the domestic nuclear industry, the framework represents a generational opportunity to rebuild manufacturing capacity. The $10 billion advance payment for long-lead items will flow directly into the heavy forging and specialized component sectors, which have struggled with inconsistent order volumes. Establishing a steady pipeline of eight reactors provides the demand certainty required for suppliers to invest in new tooling and workforce training.[2][4]

As the framework transitions from a diplomatic agreement to commercial execution, the focus will shift to site selection and detailed engineering. The use of federal land in states like Ohio and Tennessee is intended to bypass some of the local zoning hurdles that can delay large infrastructure projects. However, integrating eight gigawatt-scale reactors into the regional transmission grids will require substantial upgrades to existing power lines and substations.[2]

The ultimate success of Project Power will depend on maintaining political and financial alignment over a multi-decade construction horizon. While the $120 billion allocation provides a robust foundation, the actual deployment of the reactors will test the capacity of the U.S. and South Korean industrial bases. The framework establishes the architecture for a massive nuclear expansion, but the physical realization of that vision remains years away.[1][2]