In a historic shift in domestic nuclear policy, the U.S. Department of Energy (DOE) announced it has entered into “advanced negotiations” with five private nuclear energy startups to supply them with surplus, Cold War-era weapons-grade plutonium.
The initiative, managed under the federal Surplus Plutonium Utilization Program, marks the first time the U.S. government has opened up its military plutonium stockpiles to private commercial entities. If finalized, the deal will allow startups to recycle high-risk military liabilities into fuel for next-generation Small Modular Reactors (SMRs).
The Five Selected Startups
The DOE’s Office of Nuclear Energy has tapped five advanced reactor and nuclear technology developers for the initial negotiation phase:
- Oklo Inc.: The California-based fast-reactor startup, which is partnering with European developer Newcleo to build domestic fuel-fabrication infrastructure.
- Exodys Energy: Focused on developing advanced mixed oxide (MOX) fuel cycles.
- SHINE Technologies: Specializing in nuclear recycling and medical isotope technologies.
- Flibe Energy: Developing molten-salt reactor designs that utilize liquid fluorides.
- Standard Nuclear: Working on advanced commercial fuel applications.
Solving the Advanced Nuclear Fuel Bottleneck
The policy pivot addresses a critical bottleneck facing the advanced nuclear sector: a severe shortage of domestically produced fuel.
Most modern SMR designs rely on High-Assay Low-Enriched Uranium (HALEU), which is enriched between 5% and 20%. Currently, Russia dominates the global commercial HALEU supply chain. However, following the 2024 U.S. ban on Russian uranium imports—set to fully choke off supply chains by 2028—American developers have been scrambling for alternative domestic fuel sources while local enrichment facilities slowly scale up.
Plutonium-239, harvested from dismantled nuclear warheads, can act as a potent alternative or “bridge fuel.” Fast-neutron reactors, like those being designed by Oklo, are uniquely engineered to run on either uranium or recycled plutonium-based mixtures.
“Fuel supply constraints are a key throttle to advanced reactor development,” said Jacob DeWitte, co-founder and CEO of Oklo. “This program creates a pathway to use existing surplus material as bridge fuel for advanced reactors to bring more reactors online sooner.”
A Reversal in Federal Disposal Strategy
The United States holds a legacy stockpile of over 50 metric tons of surplus weapons-grade plutonium from the Cold War. For years, the federal government’s default plan was to dilute the material, encase it in glass or concrete, and bury it deep underground at a high-security waste isolation site in New Mexico—a framework estimated to cost taxpayers roughly $19 billion over three decades.
The new program fundamentally reverses this approach. Under the updated framework, the DOE plans to distribute up to 20 metric tons of this surplus arsenal directly to the private sector. Instead of funding long-term government storage, private enterprises will bear the financial costs of processing and fabricating the material. Oklo and Newcleo have already signaled plans to invest up to $2 billion into a specialized fuel-fabrication site near Savannah River, South Carolina.
Proliferation and Safety Concerns
While energy advocates view the initiative as a massive win for a domestic “nuclear renaissance,” it has drawn sharp criticism from nonproliferation experts and some policymakers.
The primary concern is the precedent of putting weapons-grade material—highly toxic and capable of being weaponized if intercepted—into commercial hands. Critics argue that civilian plutonium processing increases security risks and undermines America’s leverage in discouraging other nations from recycling or accumulating weapons-usable nuclear materials.
Next Steps
The DOE stressed that the negotiations are not yet finalized. The upcoming phase will involve rigorous logistical, security, and regulatory reviews to determine how the material will be guarded, transported, and converted from warhead components into standardized commercial reactor elements under strict Nuclear Regulatory Commission (NRC) oversight.