The U.S. military is pursuing advanced nuclear energy technologies as part of a broader strategy to enhance energy resilience, mission assurance, and clean power generation for military installations (e.g., through the U.S. Army Janus Program and the U.S. Navy and Air Force base powering initiatives).1 In response to statutory requirements like the National Defense Authorization Act of 20192 and executive orders including EO 13972 (2021)3 and EO 14299 (2025)4, the military has been looking to partner with private companies on advanced reactors designed to supply dependable electricity and heat to bases in remote areas and to provide power for mission-essential operations during grid interruptions or off-grid deployments.
Historically, some military facilities have been selling their excess power to the bulk power grid. Congress has authorized the military departments to do so under 10 U.S.C. § 2916. This provision emerged from a broader set of 1980s and 1990s defense energy reforms focused on improving energy efficiency and allowing installations to recover costs from on-site generation.5 Military facilities must meet the same requirements as electric utilities and Federal power marketing authorities under the Federal Power Act, 16 U.S.C. 791a et seq. (i.e., to charge just, reasonable and non-discriminatory rates), when selling electricity.6 This raises a jurisdictional question. The NRC licenses commercial nuclear reactors that generate electricity for sale to the grid. Accordingly, if a defense nuclear reactor were to sell electricity to the grid, would it be required to obtain an NRC license rather than utilizing the U.S. Army regulatory pathway under EO 14299?
This blog strives to clarify the U.S. military's authority to develop and operate reactors, including through partnerships with private companies to supply electricity to military installations and potentially sell power to the grid.
First, this blog examines how the Atomic Energy Act governs when the Nuclear Regulatory Commission (NRC) licensing applies, distinguishing reactors operated under military authority from reactors that are commercial facilities. The blog also explains several decisions that must be made regarding federal safety oversight of military reactors. The first is whether the reactor serves a military purpose, a determination made by the relevant military department. For this determination, whether the reactor is selling commercial power to the grid is irrelevant. Excess electricity generated on a military facility, whether from a nuclear power plant or other type of generation, can be sold to the bulk power grid by the military pursuant to the Federal Power Act.
Second, the blog explains that if the reactor is not serving a military purpose and instead operates as a commercial facility, it must be regulated by NRC. It is up to the NRC to determine the license type—§103 for commercial power reactors or §104(c) for research, test and demonstration reactors. Commercial sales from NRC licensed reactors are regulated by the Federal Energy Regulatory Commission under the Federal Power Act.
Statutory Exclusion of Defense Reactors from NRC Licensing
The U.S. military possesses independent statutory authority to design, construct, own, and operate nuclear reactors for military purposes, and those reactors are expressly excluded from NRC licensing requirements. The Atomic Energy Act of 1954 (AEA) vests authority over military applications of atomic energy in the President and, by delegation, the military. In particular, AEA §91(b) reserves to the federal government the conduct of activities related to the utilization of atomic energy and production of special nuclear material for military purposes, including reactors used for propulsion, weapons development, and other defense missions.7 This statutory structure reflects Congress’s intent to separate civilian nuclear regulation from military nuclear operations, recognizing the unique national security considerations involved. AEA §101 and §110(b) provide further details on this framework. §101 establishes that NRC licensing is generally required for the manufacture, production, or operation of any utilization or production facility, except as provided by §91. § 110(b) makes explicit that such facilities for military purposes pursuant to §91(b), and their use by DoD or a contractor, are not subject to NRC licensing. Read together, this statutory structure reflects Congress’s intent to separate civilian nuclear regulation from military nuclear operations, recognizing the unique national security considerations involved.
That division of authority is explicitly recognized in NRC regulations. 10 C.F.R. § 50.11(a) provides that NRC licensing requirements in Part 50 do not apply to “[t]he manufacture, production or acquisition by the Department of Defense of any utilization facility authorized pursuant to section 91…”, unless the NRC is specifically authorized by statute to regulate them. The U.S. military exercises this authority through service-specific regulations, all operating under executive authority derived from the AEA and presidential directives.8
Accordingly, defense facilities operating nuclear reactors do not require an NRC license so long as the reactors are operated by the U.S. Government or its contractors pursuant to a military mission. The key jurisdictional determinant is not whether the reactor produces electricity, but whether it is a military nuclear facility authorized under the AEA’s military provisions.
Distinguishing NRC Licensing Types: The Eielson Microreactor Case
The Eielson Air Force Base microreactor project is an example that differs from the earlier discussion of military authority under §91 of the Atomic Energy Act. Rather than considering whether a reactor is entirely exempt from NRC jurisdiction, the U.S. Department of the Air Force (DAF) determined the project falls under NRC licensing. The project may propose the appropriate type of NRC license, but the NRC will have the final say as to which type of NRC license is required - i.e., §103 or §104(c). § 91 (b) focuses on whether a reactor is fulfilling a military function, a function assigned by the AEA to the President. In contrast, the NRC is responsible for deciding whether §103 or §104(c) apply to civilian-regulated reactors based on their purpose, function, and the use of the electricity they produce.
The Eielson Air Force Base normally is supplied by the Alaska grid and about 20 megawatts of onsite diesel generators. The DAF expects the microreactor to generate about 5 megawatts of electricity and accompanying thermal energy to support the base’s operations under a long-term power purchase agreement with a private developer.9 It is not clear from publicly available materials why DAF elected to pursue NRC licensing rather than the military department regulatory framework available for government-owned defense reactors. §327 of the National Defense Authorization Act (NDAA) of 2019 requires DAF to demonstrate operation of a “licensed micro-reactor.”10 To implement the NDAA, the DAF required11 the reactor to be developed, owned, and operated by a private developer in a commercial structure under a power purchase agreement. In this context, “licensed” is generally understood to mean an NRC license rather than a military department regulatory pathway.
NRC must determine whether this facility is to be licensed under AEA §103 versus AEA §104(c). AEA §103 governs NRC licensing for industrial or commercial utilization facilities, while AEA §104(c) applies to research, development, and demonstration reactors where electricity generation is incidental. AEA §31 further defines the permissible research activities underlying AEA §104(c) licenses. Because the Eielson microreactor’s primary purpose is to supply electricity to the base, likely the NRC will decide it falls within the scope of a commercial utilization facility, triggering NRC licensing under AEA §103 rather than AEA §104(c).
This commercial licensing requirement—including siting, construction, operation, and decommissioning—reflects the principle that NRC jurisdiction applies when a reactor’s primary purpose is to produce electricity for a person. The AEA defines person broadly but the President can narrow the definition to exclude a military department or its contractors. A person must have an NRC license to possess or operate a reactor in a functional configuration even if the primary customer is a military facility. A reactor whose output is purely incidental to research or demonstration might qualify for a §104(c) license under §31, but in the Eielson case, the delivery of electricity and thermal energy to support the base’s operations makes the facility a commercial reactor. As a result, the Air Force expects the project to proceed through the NRC’s commercial licensing framework to ensure regulatory oversight, safety, and compliance with applicable statutes under an AEA section 103 license.
Conclusion
The AEA is structured to reflect a policy choice to transfer control of nuclear technology use and development from the Department of War after the successful Manhattan Project of World War Two. This civilian control was assigned to the Atomic Energy Commission, and that function has been transferred to the DOE and NRC today. In 1954, the AEA was amended to recognize that there are military development and uses of nuclear technology that should be under the control of a military department and authorizes the President to determine what those are. Where the President has designated such a military use, the military department or its contractors may operate a nuclear reactor without a license from the NRC. Importantly, the sale of electricity to the grid does not determine whether a reactor is subject to an NRC license. Regardless of whether a reactor operates under U.S. military regulatory authority or NRC oversight, sales of electricity from such a reactor would be subject to the Federal Power Act.
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1Nuclear Innovation Alliance, New Nuclear Reactors for Military Purposes (Dec. 2025), available at https://nuclearinnovationalliance.org/sites/default/files/2025 12/New%20Nuclear%20Reactors%20for%20Military%20Purposes.pdf
2See Fiscal Year 2019 National Defense Authorization Act, Pub. L. No. 115-232, § 327 (requiring the Secretary of DoD/DoW to report on a pilot program to site, construct, and operate at least one licensed micro-reactor by December 31, 2027)
3Executive Order 13972, “Promoting Small Modular Reactors for National Defense and Space Exploration,” Jan. 5, 2021, The White House, https://trumpwhitehouse.archives.gov/presidential-actions/executive-order-promoting small-modular-reactors-national-defense-space-exploration/ (directing coordinated federal use and demonstration of advanced reactor technologies including small modular reactors for national defense and space exploration).
4Executive Order 14299, “Deploying Advanced Nuclear Reactor Technologies for National Security,” May 23, 2025, The White House, https://www.whitehouse.gov/presidential-actions/2025/05/deploying-advanced-nuclear reactor-technologies-for-national-security/ (directing coordinated use and deployment of advanced nuclear reactors for defense and national security applications and related agency actions).
5See, 10 U.S.C. § 2916, “Sale of electricity from alternate energy and cogeneration production facilities” (added by Pub. L. 98407, title VIII, § 810(a), Aug. 28, 1984; amended by Pub. L. 103160, div. B, title XXVIII, § 2802, Nov. 30, 1993) (authorizing military departments to sell electricity generated on installation property and credit proceeds for energy supply and related projects).
6Under the Federal Power Act (16 U.S.C. § 791a et seq.), entities that sell electricity—including federal facilities when acting like power sellers—must comply with the same regulatory standards as electric utilities and federal power marketing authorities. Specifically, rates and charges must be just, reasonable, and non discriminatory (16 U.S.C. § 824d), and the Federal Energy Regulatory Commission (FERC) has authority to review and adjust any rates or practices that are found to be unjust or discriminatory (16 U.S.C. § 824e). The federal Power Marketing Administrations in the United States consist of four agencies including the Bonneville Power Administration that markets the power generated by the Columbia Nuclear Power Plant, so there is a long standing successful example for a military department to follow if it intends to market sizeable quantities of electric service from nuclear facilities.
7Atomic Energy Act of 1954, Pub. L. 83-703, § 91(b) (Aug. 1, 1954), codified at 42 U.S.C. § 2121(b).
8Rama T. Ponangi and Brittany Lutz, U.S. Federal Oversight of Nuclear Reactors by NRC, DOE, and DoD, Nuclear Innovation Alliance, 8 (November 2025). https://nuclearinnovationalliance.org/sites/default/files/2025 11/U.S.%20Federal%20Oversight%20of%20Nuclear%20Reactors%20by%20NRC%2C%20DOE%2C%20and%20DoD% 20%2811-25%29.pdf
9Department of the Air Force, Micro‑Reactor Pilot, FAQs (Office of the Deputy Assistant Secretary for Infrastructure, Energy and Environment, March 2025), 1. https://www.eielson.af.mil/Portals/40/ENVIRONMENT/Micro-Reactor/DAF%20Micro Reactor%20FAQs_FINAL%20%28March%202025%29.pdf
10 National Defense Authorization Act for Fiscal Year 2019, Pub. L. No. 115-232, § 327(a), 132 Stat. 1636, 1739 (2018) (“The Secretary of Defense shall develop and carry out a pilot program to demonstrate the feasibility of operating a licensed micro-reactor on a military installation for the purpose of enhancing energy resilience and ensuring mission assurance.”).
11 Eielson Air Force Base, Microreactor Pilot Program. https://www.eielson.af.mil/microreactor/