Defense Policy Becomes a Tailwind for the Nuclear Renaissance

This year’s National Defense Authorization Act (NDAA) has emerged as a perhaps surprising catalyst for the nuclear energy sector, reinforcing the “nuclear renaissance” investment theme.

The passage of the fiscal year 2026 defense policy bill marks a key moment for the nuclear energy sector, as the U.S. government increasingly views nuclear power through the lens of national security and reindustrialization. 

The final version of the bill authorizes approximately $901 billion in total national defense discretionary funding. This topline allocates roughly $34.3 billion to the Department of Energy (DOE) for national security programs, a move that reinforces long-term demand for nuclear power. The National Nuclear Security Administration (NNSA) received a significant boost, with authorizations reaching $26 billion, which is a notable increase over previous years. 

Military Adoption of Small Modular Reactors (SMRs)

A highlight of the bill is the expanded authority for the Department of Defense (DOD) to pilot and deploy Small Modular Reactors (SMRs). Specifically, the bill prioritizes advanced nuclear technology at naval-support installations and codifies a pilot program to bring SMRs into the DOD footprint. This follows a high-profile $800 million federal cost-share award announced earlier this month to the Tennessee Valley Authority (TVA) and Holtec Government Services to support early SMR deployments.

Beyond this, the U.S. Army is aggressively pursuing black-start capabilities through Project Janus. This initiative aims to deploy commercial microreactors — defined as units producing fewer than 20 megawatts — at nine domestic installations by the end of the decade. 

These federal commitments provide an advantage to the companies capable of delivering modular designs. Deploying the technology initially at military bases paves the way for future civilian and commercial uses, such as providing power for AI data centers.

Gaining Nuclear Exposure With NUKZ

Advisors looking to capture this intersection of defense policy and energy technology may find a relevant tool in the Range Nuclear Renaissance ETF (NUKZ). Unlike broad utility funds, NUKZ tracks companies across the nuclear fuel and energy industry, including advanced reactors, construction, and fuel services. Furthermore, the fund’s holdings stand to benefit from the increased focus on U.S. energy security and the modernization efforts outlined in the NDAA.

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