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Supply chain data to Openai nvidia This week, the $100 billion investment commitment sheds a clear light on the US’s heavy reliance on foreign suppliers of components to complete the project.
Brandon Daniels, CEO of AI-powered risk and supply chain management solutions company Exiger, told CNBC whether it’s gas-fired or nuclear, that traditional power plants require an array of special parts that the US does not produce in large quantities.
“There are four major categories of equipment that are very expensive and largely foreign languages. This dependency occurs when power generation construction is already tackling a tough backlog or shortage,” warned Daniels.
The first is a gas turbine.
Exiger supply chain data analysis shows that the global market for robust, utility-scale turbines is dominated by three original equipment manufacturers (OEMs). Ge Vernova In the US, Siemens In Germany and Japan Mitsubishi.
The three controls’ new turbine supply, and nearly 50% of that supply, Daniels said, is foreign-made. “These companies are essential to strengthening (artificial intelligence) infrastructure of this size,” he said.
Nuclear components
The second category is forging and components in ultra-large nuclear plants.
Daniels said that in the United States, for example, large One Piece reactor pressure vessels and associated hardware were no longer manufactured in the United States. South Korea-based Dousan has produced pressure vessels and steam generators for a recently created reactor at the Bogle plant in Georgia, the first new nuclear plant in the United States.
The large transformers essential for distributing electricity from the power plants to the electric grid, the third part of the supply chain relies on overseas suppliers.
Over 80% of these high-voltage transformers are made by suppliers from South Korea to Germany and Canada, Daniels said.
Steel is the fourth element of this supply chain and could add cost.
“Alliances like the US and the UK still remain important producers, but project developers often rely on imports to meet both cost and capacity needs,” Daniels said.
Tariff effects
Higher tariffs on imports only add to the complexity of these projects.
“The impact of tariffs is not uniform because build-outs and planning scale can take years rather than months, so the domestic capacity in the US could grow in the meantime,” Daniels said. “Some Allies are under a lower tariff regime, for example, as the UK is now exempt from US steel fees. But even with these engravings, the scale of the necessary means of materials and equipment will increase.”
For multi-billion-dollar energy projects, a 3% to 6% budget increase due to tariffs would translate to hundreds of millions of dollars, Daniels said.
“It’s just steel and aluminum,” Daniels said. “Additional pressure comes from foreign-made components such as turbines, reactor vessels, transformers, and other foreign-made components, where the backlog and import reliance amplifies the exposure.
To this, add the amount of labor assistance needed to complete the plan.
“This requires a near wartime labor expansion at industrial bases,” Daniels said. “We don’t have a skilled workforce for this fast scaling. The US (building) trade is already declining and there is a shortage of welders, mechanics and electricians. This can be as big a pinch point as the hardware itself.
