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Frontier vision-language models achieve only 50-53% accuracy on basic quantitative physics tasks, behaving as approximate guessers that preserve semantic plausibility while violating physical constraints. Safety-critical control demands outcome-space guarantees over executed actions, not parameter-space imitation. Here we present a pathway toward domain-specific foundation models through compact language models operating as Agentic Physical AI: policy optimization driven by physics-based simulator validation rather than perceptual inference. We train a 360M-parameter model on synthetic nuclear reactor scenarios scaled from 10^3 to 10^5 examples. Scaling produces strong, regime-dependent reliability gains under nominal simulated conditions, with variance coll","title":"Agentic Physical AI toward a Domain-Specific Foundation Model for Energy Systems: A Case Study on Nuclear Reactor Control","url":"https://arxiv.org/abs/2512.23292","vendor":"arxiv_cs_ai"},"summary":"arXiv:2512.23292v4 Announce Type: replace \nAbstract: The prevailing paradigm in AI for physical systems: scaling general-purpose foundation models toward universal multimodal reasoning, confronts a barrier at the control interface. Frontier vision-language models achieve only 50-53% accuracy on basic quantitative physics tasks, behaving as approximate guessers that preserve semantic plausibility while violating physical constraints. Safety-critical control demands outcome-space guarantees over executed actions, not parameter-space imitation. Here we present a pathway toward domain-specific foundation models through compact language models operating as Agentic Physical AI: policy optimization driven by physics-based simulator validation rather than perceptual inference. We train a 360M-parameter model on synthetic nuclear reactor scenarios scaled from 10^3 to 10^5 examples. 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