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Japanese leaders are investing up to $40 billion in small nuclear reactors in Tennessee and Alabama through a 2025 deal reached with the Trump administration.
The deal is part of a trade agreement that commits Japan to a $550 billion total investment in the United States. Japan also will invest in natural gas generation, a key energy interest of Trump’s.
Japanese Prime Minister Sanae Takaichi announced the agreements during her visit to the United States last month. GE Hitachi, which is partnering with the Tennessee Valley Authority on the Clinch River small modular reactor project in East Tennessee, is listed as the project operator in fact sheets about the investments on the White House and U.S. Department of Commerce websites.
“The groundbreaking commercial deployment of the advanced SMRs in the U.S. will serve as a next-generation stable power source, stabilizing electricity prices for the American people and strengthening the U.S. leadership in global technological competition,” commerce department officials said in a fact sheet.
TVA estimated the cost of a 300-megawatt small modular reactor at $5.4 billion, according to information in the utility’s 2025 draft Integrated Resource Plan. Small modular nuclear reactors are a fraction of the size of giant plants that require huge cooling towers.
TVA serves almost all of Tennessee but only the northern part of Alabama, which hosts the utility’s oldest and most powerful nuclear plant: Browns Ferry in Limestone County. The plant produces about a fifth of the utility’s total generating capacity. TVA also owns an unfinished nuclear plant in Hollywood, Alabama, near Huntsville.
New reactors could position U.S. to gain global ground on energy, senator says
The $40 billion investment represents a broader sense among Japanese officials that Tennessee’s energy business is on the upswing, according to U.S. Sen. Bill Hagerty. Hagerty, a former ambassador to Japan, said in remarks in Oak Ridge on April 2 that Japan’s business community is pleased to return to Tennessee.
“We can deliver here in an incredible way,” he said. “We want to be on the forefront. We want to be on the cutting edge.”
Hagerty, who serves on the Senate Committee on Foreign Relations, said he was deeply involved in the trade deal.
“The investment is something I’ve been trying to nurture for a long time ‒ since before I was ambassador,” he told Knox News. “The Japanese see the strategic value beyond just the economic impact. There’s a national security component to their desire to invest in America.”
That value is tied to Japanese and American competition with China, Hagerty said.
Since taking office as a senator, Hagerty has been a proponent of speeding nuclear development, especially in the Volunteer State. At times, he’s criticized TVA’s leaders as moving too slowly on nuclear projects. In a 2025 op-ed piece published in POWER Magazine, Hagerty and Sen. Marsha Blackburn, both close allies of President Donald Trump, called for a new board to direct TVA and an interim CEO from outside the utility to lead daily operations, citing among other things the pace of nuclear progress.
Shortly after the piece was published, Don Moul, who’d been TVA’s chief operating officer, was appointed the utility’s next CEO, and Trump fired several board members, leaving TVA without a quorum for months.
Mariah Franklin reports on technology and energy for Knox News. Email: mariah.franklin@knoxnews.com. Signal: mariahfranklin.01