By Faridat Salifu
The latest report from the International Atomic Energy Agency (IAEA) underscores the urgent need for a substantial increase in global investment in nuclear power to meet the growing demand for clean energy and tackle climate change.
Released during the Clean Energy Ministerial (CEM) in Brazil, the 2024 edition of the Climate Change and Nuclear Power report calls for an annual investment of $125 billion, more than doubling the current average of $50 billion annually between 2017 and 2023.
The report highlights nuclear energy’s critical role in global efforts to reach net-zero emissions by 2050. Under the IAEA’s high-case scenario, nuclear capacity would need to expand by 2.5 times its current level by mid-century.
To achieve this, not only must investments increase, but financial barriers, particularly for developing countries, must also be addressed.
IAEA Director General Rafael Mariano Grossi emphasized the affordability and competitiveness of nuclear power over its lifetime but acknowledged that securing the upfront capital is a significant challenge, especially in market-driven economies.
“Financing the upfront costs can be a challenge, particularly in developing countries,” Grossi said, adding that multilateral development banks will play a crucial role in ensuring better access to nuclear financing for these nations.
Private sector involvement is gaining momentum, as evidenced by a recent commitment from 14 major financial institutions during New York Climate Week to support nuclear newbuild projects.
This growing interest comes as more governments and financial institutions recognize the importance of nuclear energy in the cleaner energy mix.
The report was launched alongside a joint event by the IAEA and CEM’s Nuclear Innovation: Clean Energy Future (NICE) initiative.
The CEM, a global platform for promoting clean energy policies, has increasingly focused on nuclear power as part of the broader strategy to achieve affordable and sustainable energy for all.
Jean-Francois Garnier, Head of the CEM Secretariat, noted, “Financing the necessary expansion of nuclear power to help integrate other sources of clean electricity is key to success, and innovative approaches to attract investments from both public and private sectors are essential.”
Countries like Brazil are already leveraging IAEA’s expertise. Giovani Machado, an advisor to Brazil’s Energy Research Office (EPE), praised IAEA publications for guiding Brazil’s national energy policy, particularly in assessing the Angra-3 nuclear power reactor.
The report further points to emerging financing tools, such as green bonds issued for nuclear power, which are starting to gain traction in Europe.
France’s Electricité de France (EDF) secured €4 billion in green bonds in 2023, a promising sign that nuclear power is being recognized within sustainable finance frameworks.
As the world gears up for COP29 in Azerbaijan, where financing clean energy will be a central topic, the IAEA report stresses the need for international collaboration, regulatory reform, and innovative financing mechanisms to close the investment gap.
These measures will be crucial in scaling nuclear power and enabling emerging markets to join the clean energy transition.
By accelerating nuclear expansion, the world can make significant strides toward a cleaner, more sustainable energy future, while also securing energy security and reducing carbon emissions.