The United States is now fully engaged in a new space race with China — one that is much broader than the US-Soviet Union competition in the 1960’s and 1970’s. China and the US are competing in Earth-orbiting networks of commercial communications satellites, in creating diverse and resilient global positioning systems, and new types of military networks for missile defense and other national security purposes.
The highest-profile component of the US-China space competition is most visible in China’s and the US’s ambitious human and robotic space exploration agendas. China’s progress in developing its own space station and achieving difficult lunar robotic landings has increased pressure on NASA’s timelines for replacing the International Space Station and, especially, for landing and sustaining human presence on the Moon and, eventually, Mars.
In this race, the US may be falling behind in development and deployment of one technology likely to influence which nation wins: nuclear power. That’s because, despite high-profile efforts to prioritize this capability, the US has not generated the level of investment and government commitment necessary to reach scale.
What makes nuclear a compelling power solution is its inherently high-energy density that can reduce interplanetary travel times from years to months and the sustainable electric power that can be generated for long stays in space. Space-based nuclear power offers a compelling solution to enable America’s space ambitions — if, and only if, our nation makes the full commitment needed to break down existing technological, political, and commercial barriers to deploying sufficient nuclear power. America is just now starting to push large-scale space nuclear capabilities forward. But winning the space race requires much more to be done, and quickly.
NASA takes a bold step forward on nuclear power
In August, the National Aeronautics and Space Administration (NASA) unveiled plans to get a 100-kilowatt nuclear reactor up and running on the moon by 2029. This is an important commitment that will bolster America’s lunar and broader space goals. But is it enough?
While an intrepid project conceptually, many in the industry worry that the project’s business model simply does not match the scale of its aspiration or the relatively short timetable it has set. Under the plan, NASA will act as an anchor customer for an unspecified portion of the Moon reactor’s energy generation. That role as anchor customer worked for NASA with more mature programs, such as the International Space Station and building a commercial lunar lander, but the technology and coordination necessary for a complex project like building a reactor on the Moon is far less advanced.
Instead, NASA and the nation need a more muscular and broad-based financial, political and technical commitment to meet its own ambitious timetables for space leadership. For this nuclear plan to meet NASA’s goals, it will need to be more ambitious and concrete: for example, buying a specified amount of power (for example, 75%, with a de-escalation scale tied to commercial partners joining on) from the reactor once online to incentivize adequate private sector response and could prevent delays in progress toward action.
Why the US government's role must grow in a nuclear era
If the US is to take the lead in nuclear propulsion technology and nuclear energy use in space, it will require the government to put up convincing and timely levels of investment and technical support to match its ambitions. This would require tapping not just NASA for funds and technical expertise but also the Department of Defense (DoD), Department of Energy (DoE), and related sub-agencies, along with relevant private-sector actors.
These stakeholders of space nuclear energy face a classic “chicken and egg” dilemma common to all space investments. The development of nuclear propulsion and power systems requires substantial investment based on the potential of an eventual sizable demand, yet without the system’s availability and demonstrated viability, the demand doesn’t materialize fast enough to encourage investors. On the flip side, there is a lack of commercial players large enough to absorb the level of investment needed to scale the technology, given how long it will take to generate the customer and mission base and its likely fragmentation once established. Without clear, immediate demand, investors hesitate, perpetuating a cycle of underinvestment.
Here's where the government can act as a crucial convener. The network across agencies such as NASA, DoE, and DoD must be leveraged to align efforts, and regulatory harmonization nationally and internationally would smooth technology deployment and operation and help develop robust regulatory frameworks that not only ensure environmental and safety protections and transparent public engagement but also encourage investor participation.
Why nuclear power matters
Still, there is a growing sense of urgency around making nuclear a central theme in the space race where the US’s lead against global rivals is slipping away. Beyond putting a nuclear reactor on the Moon, the US also stands on the threshold of a profound leap in space exploration, with plans to send astronauts and spacecraft to Mars and beyond. But achieving these goals requires the development of nuclear propulsion technology and modular nuclear energy capacity.
Nuclear propulsion systems (both nuclear thermal or nuclear electric) can provide sustained thrust over long durations, shrinking the travel times on interplanetary missions. Space-based nuclear reactors also can generate substantial electrical power to fuel life support systems, scientific payloads, and communications equipment crucial to unlocking many emerging commercial and government projects such as asteroid mining and manufacturing in space. Even today, activities like satellite servicing and refuelling increasingly depend on the kind of sustainable power nuclear generators best provide.
Many current missions have nuclear components (ranging from radioisotope power systems for electrical generation to nuclear thermal and electric propulsion), validating the recognition that nuclear energy must be part of the equation in any modern-day space programs looking to travel beyond the Moon or develop more expansive activities. Examples of accidents involving radioactive leaks or debris are limited and mostly decades old.
The nuclear space race is on
Globally, emerging tailwinds are supporting nuclear power's return to prominence and improving the perception of nuclear power in the public eye. In the US, Westinghouse’s announcement to build 10 large reactors signals renewed confidence in nuclear energy. Globally, the International Atomic Energy Agency (IAEA) has reported four straight years of growing positive outlooks on the development of nuclear power. Meanwhile, advances in nuclear technology — from small modular reactors to enhanced safety systems — have improved viability.
Failure to develop the power infrastructure necessary to fulfil the US’s missions risks ceding leadership, making nuclear power development not just a critical energy solution but also a strategic imperative.
How to break the cycle of underinvestment in space-based nuclear technology
Our space team at Oliver Wyman has landed on four critical strategies we feel will break the cycle of underinvestment:
- Public-private partnerships. Governments can share risk and support development through funding, policy, and regulatory frameworks while private enterprise drives innovation and cost efficiencies. NASA’s responsive launch initiative exemplifies successful public-private partnership models that could be adapted to nuclear propulsion.
- Incremental modular development. Instead of solely pursuing monolithic systems, phased building of smaller, modular nuclear reactors for space power enables progressive technical demonstration and market confidence.
- Incentives for early adopters. Grants, tax incentives, and contracts for initial nuclear power users help build a customer base, catalyzing further investment.
- Demonstration missions. Pathfinding missions showcasing nuclear propulsion and power capability provide validation that attracts broader interest.
While these examples have faced disruptions in political support over time, they demonstrate that coordination among industry leaders can unlock funding, establish favorable regulatory frameworks, and enable industry to pursue financially viable investments amid uncertainty. Establishing consistent and patient support across stakeholders is therefore central to overcoming the massive systemic challenges in maturing the space nuclear ecosystem.