IEA: Is Nuclear the Solution to a Low-Emissions Future?

Nuclear energy is poised for significant expansion according to the International Energy Agency (IEA).

The IEA’s 2025 report, 'The Path to a New Era for Nuclear Energy,' shows an acceleration in nuclear power adoption while also spotlighting its major challenges.

“It’s clear today that the strong comeback for nuclear energy that the IEA predicted several years ago is well underway, with nuclear set to generate a record level of electricity in 2025,” said IEA Executive Director Fatih Birol. 

“In addition to this, more than 70 gigawatts of new nuclear capacity is under construction globally, one of the highest levels in the last 30 years, and more than 40 countries around the world have plans to expand nuclear’s role in their energy systems. SMRs in particular offer exciting growth potential. 

“However, governments and industry must still overcome some significant hurdles on the path to a new era for nuclear energy, starting with delivering new projects on time and on budget – but also in terms of financing and supply chains.”

The present state of nuclear energy

Today, nuclear power holds the title as the second-largest source of low-emissions energy globally following hydropower, and it supplies nearly 10% of the world's electricity.

With soaring demands for electricity, partly driven by new technology needs like AI requiring immense energy for data centres, nuclear energy could be a crucial solution with its robust and flexible energy output.

A majority of nuclear facilities reside in advanced economies, but many of these plants are aging. 

The production and enrichment of uranium, the lifeblood of these plants, also remain intensely concentrated.

“Today, more than 99% of the enrichment capacity takes place in four supplier countries, with Russia accounting for 40% of global capacity, the single largest share,” Dr Birol said.

What does the future hold for nuclear?

The nuclear sector’s landscape is evolving rapidly according to the IEA.

A significant number of projects are underway, especially in China which is expected to surpass both the United States and Europe in nuclear capacity by 2030.

A notable shift towards innovative nuclear technology has been seen, particularly with small modular reactors (SMRs), which are drawing mounting interest from the private sector.

Notably, Amazon has taken proactive steps in developing nuclear solutions.

The company has inked agreements aiding the development of two SMR project sites as well as a company engaged in nuclear energy generation.

Amazon has been the world's largest corporate purchaser of renewable energy in the world for five consecutive years. 

Kara Hurst, Chief Sustainability Officer at Amazon, says: “Meaningful climate action requires speed and scale — and Amazon continues to explore carbon-free energy solutions.

“We’ve signed agreements to help develop new nuclear energy projects in the US — including enabling the construction of new Small Modular Reactors (SMRs). These advanced nuclear reactors have a smaller physical footprint and can be built more quickly, allowing them to come online sooner.”

The IEA is optimistic that with adequate support, SMR installations could reach an 80 GW capacity by 2040, representing 10% of global nuclear capacity.

However, this ambitious growth necessitates doubling the yearly investment in nuclear projects to US$120bn by 2030.

Nomi Ahmad, CEO of GE Vernova's Financial Services business, says: “Private finance will play a pivotal role in getting future nuclear projects off the ground. By working with regulators, governments, industry, and investors to develop smarter funding approaches, we can overcome cost and schedule challenges, share risks, and accelerate progress. 

“SMRs have the potential to break the stigma of run-away costs and schedules and make nuclear energy as easily deployable as a combined cycle project, but first, we need clear government commitment to a nuclear roadmap, a policy to enable sites to be identified and permitted creating a pipeline for developers, nuclear regulators internationally to align on how to leverage each other’s reference projects and for the planning process to be fast tracked in order to meet demand. 

“SMRs create the opportunity for a repeatable cycle that creates business cases for investors and supply chain alike, who are champing at the bit to drive economic growth and deliver energy security.”

Explore the latest edition of Sustainability Magazine and be part of the conversation at our global conference series, Sustainability LIVE. 

Discover all our upcoming events and secure your tickets today.

Sustainability Magazine is a BizClik brand