PEM Electrolysis Nuclear Projects, 3 DOE Demos, a 1.25 MW Constellation System, and 3 Plant Integrations (2021 to 2026)

Nuclear Hydrogen Adoption, 3 DOE Pilots, and Commercial Scale Signals

The period from 2025 to 2026 marks a decisive shift from theoretical analysis to the physical deployment of multi-megawatt electrolysis systems at operating U.S. nuclear power plants. Driven by U.S. Department of Energy funding and federal tax incentives, this phase moves beyond the foundational studies and simulations of 2021-2024 to generate real-world operational and economic data, which is essential for de-risking future commercial-scale investments. The variety of technologies and partners involved in these initial projects indicates a strategic effort to test multiple pathways for market entry.

Pre-2025: Foundational Research and Policy

The years leading up to 2025 were defined by preparatory work and small-scale simulations rather than commercial deployments at active power plants. This period established the necessary policy and technical groundwork for the current demonstration projects.

• Before 2025, most activity was centered at national labs, such as the Idaho National Laboratory (INL), which ran simulations like a 250-kilowatt electrolyzer test to model integration with nuclear energy sources.
• Policy was the main catalyst, culminating in the Inflation Reduction Act, which established the 45 V Clean Hydrogen Production Tax Credit. The final rules, clarified in early 2025, confirmed eligibility for nuclear power, providing the financial certainty needed for capital-intensive pilot projects.
• During this time, nuclear operators and utilities conducted feasibility studies, but there were no significant hardware commitments or construction activities for co-located hydrogen production at commercial nuclear sites.

2025-2026: Deployment and Technology Validation

The current period is characterized by the execution of three key US nuclear demonstrations, each serving as a critical testbed for different technologies and operational models. This phase represents the first material investment in physical infrastructure at commercial sites.

• At the Nine Mile Point Nuclear Station, Constellation Energy is commissioning a 1.25 MW Proton Exchange Membrane (PEM) electrolyzer system, a project that moved into the physical construction and operational phase after 2024.
• Xcel Energy‘s Prairie Island project in Minnesota, in partnership with Bloom Energy, is advancing the first-of-its-kind demonstration of a high-temperature Solid Oxide Electrolyzer Cell (SOEC) integrated with a nuclear plant, testing a higher-efficiency production pathway.
• Energy Harbor is moving forward with a Low-Temperature PEM system at its Davis-Besse Nuclear Power Station in Ohio, with a planned capacity between 1 and 3 MW, focused on generating data for both internal use and external markets like transportation.

$27 B Market in 2024, Pink Hydrogen Forecasts, and Federal Backing

Robust federal support, combining direct DOE funding for demonstration projects with powerful tax credits, has created the financial foundation for the “pink hydrogen” market. This government backing de-risks initial private investment and underpins analyst forecasts projecting a multi-billion dollar market by the end of the decade.

DOE Demonstration Funding

The Department of Energy’s Light Water Reactor Sustainability (LWRS) Program is the primary public funding vehicle catalyzing the sector. It provides the financial backing to bridge the gap between concept and commercial viability for first-mover projects.

• The DOE is directly supporting the demonstration projects at Prairie Island, Nine Mile Point, and Davis-Besse, enabling operators like Xcel Energy and Constellation to test different electrolysis technologies without bearing the full financial risk.
• The program’s stated goal is to enable up to 150, 000 tons of hydrogen production from operating reactors by 2029, providing a clear demand signal for technology providers and engineering firms.

45 V Tax Credit as the Economic Foundation

The Clean Hydrogen Production Tax Credit (45 V), established by the Inflation Reduction Act, is the most significant long-term economic driver. It provides a direct, per-kilogram subsidy that makes nuclear-produced hydrogen cost-competitive.

• Treasury guidance issued in early 2025 provided a specific pathway for nuclear power to qualify for the tax credit, resolving critical uncertainty that had previously stalled investment decisions.
• The credit is essential for making pink hydrogen economically viable against both incumbent fossil-fuel-based hydrogen and competing clean hydrogen sources, especially for nuclear plants facing economic pressures from other power markets.

Table: Pink Hydrogen Market Size Forecasts: Comparative Analysis

US Regional Focus, Nuclear Hydrogen Projects in NY, MN, and OH

The initial wave of U.S. nuclear-to-hydrogen deployment is geographically concentrated in the Midwest and Northeast. This strategy leverages existing, high-capacity nuclear assets in regulated markets or regions with supportive state-level clean energy policies and potential industrial hydrogen offtakers.

Midwest as a Proving Ground

Ohio and Minnesota are host to two of the three key demonstration projects, positioning the Midwest as a central hub for validating the economic and operational models of nuclear hydrogen production.

• The Davis-Besse project in Oak Harbor, Ohio, operated by Energy Harbor, aims to produce hydrogen for both internal plant use and, critically, for external markets such as regional transportation and industry, testing the full value chain.
• At Prairie Island in Red Wing, Minnesota, Xcel Energy‘s project is a test case for integrating advanced, high-efficiency electrolysis, which could provide a competitive advantage if proven successful at scale.

New York’s Clean Energy Leadership

Constellation‘s project at the Nine Mile Point facility in Oswego, New York, aligns with the state’s aggressive decarbonization targets and highlights the role nuclear hydrogen can play within a broader clean energy portfolio.

• The 1.25 MW PEM electrolyzer is the first to be installed at a U.S. nuclear plant, giving Constellation a first-mover advantage in understanding the operational integration challenges and opportunities.
• The initial output will be used for plant cooling, replacing hydrogen currently supplied by other means, but the project is explicitly designed to demonstrate scalability for future, larger commercial applications.

Technology Validation, PEM vs. SOEC at 3 Nuclear Plants

The current U.S. demonstration phase is strategically designed to directly compare and validate two competing electrolysis pathways for nuclear integration. This parallel testing of mature Low-Temperature Proton Exchange Membrane (PEM) technology against the more efficient but developmental High-Temperature Solid Oxide Electrolyzer Cell (SOEC) technology will generate crucial data to inform future-large scale deployments.

PEM Technology as the Commercial Baseline

Two of the three active pilot projects are deploying PEM electrolyzers, reflecting a strategy to use a mature, commercially available technology to establish an operational and economic baseline for nuclear-hydrogen production.

• The projects at Constellation‘s Nine Mile Point plant and Energy Harbor‘s Davis-Besse station use PEM systems. This choice minimizes technology risk and allows the projects to focus on the challenges of system integration, operational synergy, and market development.
• While PEM electrolysis does not utilize the nuclear plant’s thermal energy, its deployment provides a clear benchmark for production costs and reliability against which emerging technologies can be measured.

SOEC as the High-Efficiency Future

The Prairie Island demonstration project is a critical, first-of-a-kind test for SOEC technology in a live nuclear environment, representing a higher-risk, higher-reward approach to maximizing production efficiency.

• In partnership with Xcel Energy, Bloom Energy‘s SOEC system leverages both electricity and high-temperature steam from the nuclear plant. This process significantly reduces the electrical energy required to split water, promising a lower levelized cost of hydrogen if the technology proves durable and reliable in operation.
• Success at Prairie Island could position SOEC as the preferred technology for future nuclear-hydrogen projects, especially for new advanced reactors designed with integrated hydrogen production in mind.

Scenario: Will Constellation Scale Beyond 1.25 MW by 2027?

The critical indicator to watch in the next 18 months is whether the initial operational data from the three pilot projects, particularly from Constellation‘s Nine Mile Point facility, is compelling enough to trigger a commercial-scale Final Investment Decision (FID) for a 100+ MW expansion by 2027. This would signal that the business case has been proven beyond the pilot stage.

Bull Case: Rapid Scale-Up

Positive operational data and favorable economics from the pilot projects could accelerate investment decisions for commercial-scale facilities. Key signals to watch for include:

• Public announcements from Constellation, Xcel Energy, or Energy Harbor regarding feasibility studies for electrolyzer systems in the 100 MW to 500 MW range.
• The formation of new joint ventures between nuclear operators and industrial gas companies or large hydrogen consumers to secure offtake agreements for future production.
• Updated analysis from the DOE showing that production costs from the pilot projects are meeting or exceeding targets, making them competitive under the 45 V tax credit framework.

Bear Case: Pilots Remain Pilots

Conversely, a lack of progress or negative data could keep nuclear hydrogen in the demonstration phase for several more years. Key signals of a stalling market include:

• An absence of announcements for follow-on projects or expansions by the end of 2026, suggesting the initial economics are not compelling enough for private capital.
• Reports of significant operational issues, lower-than-expected efficiency, or higher-than-projected maintenance costs from the three demonstration sites.
• A strategic pivot by nuclear operators back toward selling electricity exclusively to the grid, particularly if wholesale power prices rise significantly, making hydrogen production a less attractive use of an operator’s marginal megawatt-hour.

The questions your competitors are already asking

This report covers one angle of the first US nuclear hydrogen demonstration projects. The questions that matter most depend on your work.

• Large scale nuclear hydrogen plant proposals
• long term cost comparison high temperature vs low temperature electrolysis
• production cost of hydrogen from nuclear with tax credits
• companies signing contracts for nuclear produced hydrogen

This report does not answer these. Enki Brief Pro does.

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