Why did Prime Minister Sanae Takashi’s first visit to the U.S. result in a confirmed $40 billion investment in small modular reactors (SMRs)?

Executive Summary: Japanese Prime Minister Sanae Takashi’s first visit to the United States marked a pivotal moment in U.S.-Japan economic security cooperation—culminating in a $40 billion investment commitment for small modular reactor (SMR) nuclear energy projects, jointly pursued with former President Donald Trump. The initiative aims to meet surging electricity demand from AI data centers. SMRs are already entering a quasi-commercial phase in the U.S., offering advantages including modularity, lower costs, and broad applicability—holding significant promise both economically and militarily. Japan’s investment is part of a broader strategic “capital-for-technology” calculus: by participating in U.S.-based construction, Japan seeks to acquire critical know-how and operational experience, laying the groundwork for future domestic deployment to bolster energy security—and potentially support future military applications. On March 19, shortly after assuming office, Prime Minister Sanae Takashi made her inaugural visit to the U.S. and finalized, at the White House, a suite of economic security cooperation projects with then-U.S. President Donald Trump. One key announcement was the launch of a $40 billion nuclear energy investment initiative focused on small modular reactors (SMRs). According to Kyodo News, this $40 billion SMR investment will fund reactor construction in Tennessee and Alabama—led jointly by GE Vernova and Hitachi Ltd. The stated objective is to meet the explosive power demand generated by AI data centers. Some executives from Japanese private enterprises and financial institutions have voiced concerns. Senior executives at Japan’s largest banks, for instance, remain uneasy about the project’s profitability. For example, the SMRs selected for the second batch of projects face steep cost hurdles unless mass production is achieved. I. Has the SMR nuclear energy project been commercialized in the U.S.? These Japanese executives’ concerns are not unfounded—SMRs (Small Modular Reactors) have not yet achieved full commercialization in the U.S. Yet such worries may be premature: SMRs have already entered a quasi-commercial stage. In other words, while large-scale commercial operation has not yet begun, SMRs stand on the cusp of commercialization—and Japan’s investment could serve as the decisive final push. Currently, NuScale Power leads the field: its SMR design has received certification from the U.S. Nuclear Regulatory Commission (NRC). This NuScale module—the first SMR design ever approved by the NRC—generates approximately 50–77 MW per unit and can be combined into larger power plants. It also marks the first approval by the NRC in a decade for a new commercial nuclear power plant. On March 4, the U.S. Nuclear Regulatory Commission (NRC) granted TerraPower—a nuclear energy company founded by Bill Gates—its first-ever license to construct a commercial SMR facility. TerraPower plans to break ground this month in Wyoming for America’s first commercial SMR nuclear power plant, targeting demonstration operation by 2030. TerraPower’s SMR employs sodium-cooled fast reactor technology, using liquid sodium as coolant (boiling point: 880°C), significantly boosting generation efficiency and reducing nuclear waste output to roughly 10% of that from conventional nuclear plants. The plant also integrates energy storage systems, enabling flexible output adjustment according to real-time electricity demand—complementing highly variable renewable energy sources. In 2025, the Tennessee Valley Authority (TVA), in partnership with private firms, plans to build approximately 6 GW of SMR capacity across seven states—supplying power to industry, data centers, and the grid. This represents the largest SMR deployment plan in the United States.

A BYD vice president claimed, 'We can surpass Toyota even without the U.S. market'—what strategy and confidence does this reflect?

In fact, once you enter the U.S. market, you risk becoming politically entangled—effectively held hostage by American policy. You see the thieves feasting—but not the beatings they endure. Yes, Toyota, Honda, and Hyundai vehicles flood American streets—but have you considered how the U.S. manipulates Japan? And have you observed how desperately—and humiliatingly—Japan scrambles to sell just a few cars manufactured locally in the U.S.? It’s practically a surrender of sovereignty. Toyota’s U.S. sales hit a record high—reaching 2.5 million units annually. The U.S. has demanded Japan invest a total of $550 billion in the U.S. by 2029—with over $65 billion specifically earmarked for next-generation small modular reactors (SMRs). The specific funding amounts were phased in under the U.S.-Japan framework agreement: Total Investment Package ($550 billion): This is Japan’s pledge to secure tariff relief from former U.S. President Donald Trump—committing to invest $550 billion in the U.S. by 2029. Crucially, the U.S. retains absolute ‘project selection rights,’ and plans to capture 90% of the investment profits. First Batch of Nuclear Core Projects ($40 billion): In March 2026, during Prime Minister Sanae Takashi’s U.S. visit, Japan confirmed the second round of candidate projects—including a dedicated $40 billion allocation to construct next-generation SMRs in Tennessee and Alabama, led by Hitachi (in collaboration with GE Vernova). This remains the core funding item currently stalled due to disputes over liability for accidents. (Japan’s position: “We’ll wire the money—but you cannot include clauses making Japan liable if an accident occurs at the nuclear plant.”) Indeed, the U.S. government insists Japan not only provide capital but also assume full responsibility—and financial liability—for any incident. Though the U.S. Department of Commerce and Secretary Howard Lutnick orally assured Japanese institutions—including the Japan Bank for International Cooperation—that Japan would bear no liability (since the plant sits on U.S. soil and is owned by U.S. entities), Japanese officials retort: “Oral assurances aren’t enough—we demand legally binding written exemption documents.” That impasse remains unresolved. Subsequent Additional Nuclear Energy Plan ($25 billion): In June 2026, further U.S.-Japan negotiations proposed raising Japan’s total nuclear investment in the U.S. to ¥10 trillion (approximately $62.4–65 billion), adding up to $25 billion more to support NuScale Power’s SMR initiatives—beyond the initial $40 billion commitment. Yet despite Japan’s substantial upfront capital outlays, even Toyota hasn’t escaped massive losses. U.S. tariffs have wiped out all of Toyota’s North American profits—triggering rare operational losses in the region and slashing profits by 49%, even after price hikes justified by alleged inventory shortages. The tariff shock created a severe financial shortfall, forcing Toyota’s new CEO to urgently accelerate structural reforms across its North American operations. Other coercive investment demands—clarifying the earlier “90%” figure: This clause is what most suffocates Japan’s financial sector. Within Japan’s pledged $550 billion investment, the U.S. not only holds absolute project selection rights (i.e., Japan must invest exactly where and how the U.S. dictates), but also intends to claim 90% of all investment profits.

Nuclear Reactor Project in Tennessee Set to Win US Approval

15 hours ago

The US Nuclear Regulatory Commission is expected to approve TVA's plan to build a 300-megawatt BWRX-300 small modular reactor in Tennessee, marking a significant step for the fission industry.

bloomberg

2026-09-28

Nuclear Reactor Project in Tennessee Set to Win US Approval

Nuclear Reactor Project in Tennessee Set to Win US Approval

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