Why GoCo models are transforming national labs from Canada to the U.S.—and what it means for the future of science infrastructure

Governments in Canada, the United States, and the United Kingdom are increasingly adopting the Government-owned, Contractor-operated (GoCo) model to manage high-value science, energy, and national defense research infrastructure. Recent moves, including Atomic Energy of Canada Limited’s (AECL) new contract for Canadian Nuclear Laboratories (CNL), and the U.S. Department of Energy’s long-standing reliance on GoCo for its national labs, indicate a major shift in how public R&D is executed.

The GoCo structure allows the government to retain ownership of physical and intellectual assets while delegating operations to private sector or nonprofit contractors through performance-based agreements. In doing so, it blends the accountability of public ownership with the innovation and efficiency of market-driven execution.

Institutions such as BWX Technologies, Battelle Memorial Institute, Amentum, and Kinectrics are increasingly taking the lead in managing government labs—bringing global best practices in contracting, science leadership, and operational discipline to labs that serve strategic national missions.

What are GoCo labs and how do they differ from fully public or privatized research operations?

The GoCo model emerged during the Second World War with the Manhattan Project and was formalized postwar in the United States. It was later adopted by Canada in 2015, when AECL shifted the operations of CNL to private consortia under long-term contractual arrangements. Under this model, the government owns the land, laboratories, nuclear licenses, and mission mandates—but a third-party operator is responsible for day-to-day operations, scientific management, and delivery of key objectives.

In Canada, this model is now being renewed under a new six-year, C$1.2 billion per year GoCo contract with Nuclear Laboratory Partners of Canada Inc. (NLPC), a joint venture led by BWX Technologies, Amentum, and Kinectrics. NLPC will assume operational responsibility for CNL effective September 13, 2025, under AECL’s oversight.

The United States currently operates 16 of its 17 Department of Energy (DOE) national laboratories under GoCo contracts, with operators including Battelle, the University of California, and industry-led consortia. These labs serve critical functions from nuclear weapons stewardship and energy systems testing to climate modeling and medical isotope development.

How does the GoCo model enhance cost control, innovation, and accountability in national research labs?

At its core, the GoCo model aims to unlock value by combining government mission assurance with private-sector efficiency. Operators are incentivized to meet technical, budgetary, and operational performance targets while remaining fully accountable to the government sponsor.

In the Canadian context, AECL retains responsibility for long-term liabilities such as radioactive waste cleanup, while also setting multi-year operating objectives and reviewing contractor performance annually. Specific metrics include R&D output, environmental stewardship, Indigenous engagement, and financial transparency. Contracts include both base funding and performance-based incentives.

In the U.S., the DOE conducts rigorous annual performance reviews of its GoCo labs, with incentives tied to scientific excellence, safety compliance, schedule adherence, and programmatic relevance. Operators must regularly report against key performance indicators (KPIs), which are used to renew or terminate contracts. This performance-aligned approach is seen by many policymakers as a way to reduce bureaucracy without sacrificing oversight.

What are the risks and limitations of the GoCo model and how are Canada and the U.S. addressing them?

While the GoCo model has proven effective in many domains, it is not without challenges. In Canada, the Auditor General’s 2023 report highlighted issues related to contract oversight, cost inflation, and executive compensation at CNL under the previous GoCo cycle. For example, total contract payouts have exceeded C$1.3 billion annually, prompting concern about value-for-money and contract transparency.

AECL has responded by strengthening its internal governance frameworks, increasing contract management capacity, and implementing audit-friendly reporting processes. New measures include board-level performance reviews, internal risk registers, and enhanced oversight of procurement and capital projects.

In the U.S., some labs have struggled with mission drift, uneven collaboration with academia, and challenges in balancing national security imperatives with open science. These issues are typically addressed through governance reforms, peer reviews, and realignment of incentive structures. For instance, DOE’s Office of Science has introduced programmatic reviews to ensure strategic relevance across its GoCo labs.

Despite these issues, both Canada and the U.S. maintain that the GoCo model offers significant net benefits over fully public models—particularly in terms of operational agility, talent attraction, and infrastructure modernization.

Why are private-sector operators increasingly competing for GoCo contracts and what strategic value do they see in managing national labs?

For major engineering and government services firms, winning GoCo contracts is more than a revenue play—it provides strategic access to national research infrastructure, cross-sector partnerships, and long-term program visibility. BWX Technologies’ entry into the Canadian GoCo ecosystem through NLPC, for example, builds on its legacy in U.S. nuclear systems and government site management.

Firms like Battelle manage multiple U.S. labs—including Pacific Northwest National Laboratory and Oak Ridge National Laboratory—demonstrating scale, technical depth, and ability to navigate complex regulatory environments. For these operators, GoCo contracts offer stable long-term revenue, reputational enhancement, and a platform for influencing next-generation scientific agendas.

As public trust in science infrastructure becomes more politicized, these firms are also taking on roles in workforce development, DEI implementation, and Indigenous engagement—as seen in BWXT’s PAIR-Committed status and CNL’s ongoing stakeholder initiatives in Canada.

Could the GoCo model become a global standard for managing advanced science and energy infrastructure?

There is growing international interest in adopting GoCo models to manage complex, high-stakes research facilities. The United Kingdom’s UKAEA fusion program is exploring GoCo-style models for its future facilities, and countries in the Asia-Pacific are studying Canada’s CNL governance structure for isotope production and SMR testing.

Analysts believe GoCo will likely expand into areas such as fusion energy platforms, pandemic preparedness labs, AI testbeds, and space systems engineering hubs. The structure allows governments to leverage private capital and expertise while maintaining sovereign control over intellectual property and strategic outcomes.

In the clean energy transition, this model is particularly attractive. As nations look to rapidly deploy advanced energy systems—from microreactors to hydrogen hubs—the need for agile, accountable, and technically proficient operators is greater than ever. GoCo enables faster project execution and deeper integration with industrial ecosystems, which may prove essential as energy systems become more decentralized and digitally managed.

What is the investment and policy outlook for GoCo labs heading into 2030 and beyond?

Governments are signaling increased commitment to the GoCo model with larger contract sizes, expanded scopes, and longer durations. In Canada, AECL’s new six-year base contract for NLPC includes options to extend up to 20 years, reflecting confidence in long-term outsourcing of public lab operations.

In the U.S., recent budgets have increased funding for DOE Office of Science programs, with labs like Lawrence Berkeley and Sandia receiving billions in infrastructure upgrades under GoCo management. Industry observers expect this trend to continue as infrastructure modernization and AI-powered R&D become more capital-intensive.

Institutional investors monitoring these operators—such as BWX Technologies (NYSE: BWXT) and publicly traded contractors like Amentum’s future SPAC targets—see GoCo lab awards as growth catalysts that provide revenue visibility, regulatory insulation, and ESG-aligned science delivery.

With geopolitical competition, climate urgency, and biothreat preparedness driving demand for advanced public science infrastructure, the GoCo model is now viewed not as an experiment, but as an operating standard for the 21st century.