IAEA Calls For Major Investment In Nuclear Energy Expansion

The International Atomic Energy Agency published the 2024 version of its Climate Change and Nuclear Power report, pointing to a need for rapidly scaling up investments in nuclear power to achieve climate objectives. Issued on the side of the Clean Energy Ministerial (CEM) in Brazil, it is a release that reflects mounting global interest in the deployment of nuclear power as countries work to improve energy security and lower their carbon intensities. In its high case, the IAEA predicts a rise of as much as 2.5 times in nuclear capacity by 2050-to meet net-zero emissions targets.

To do this, investment in nuclear power will need to rise to USD 125 billion per year, compared to the USD 50 billion per year pledged for the period between 2017 and 2023. Over 20 countries rallied behind a tripling of nuclear capacity at COP28; doubling that will require more than USD 150 billion a year of annual investment.

While acknowledging that financial constraints are a fact of life today, particularly in market-driven and developing economies, IAEA Director General Rafael Mariano Grossi said that nuclear power remained cost-effective over its lifetime, though raising money for front-end costs can be tricky. He also stated that there was a need to attract the private sector's involvement along with public institutions and multilateral development banks to unlock funding for nuclear projects in developing nations.

The report also explores unlocking private sector financing, which has picked up momentum lately. 14 Key Financial Institutions Would Like to Have a Stake in Nuclear Projects during New York Climate Week Moreover, the report featured at a CEM side event in Brazil where key figures of IAEA, the International Energy Agency, and the U.S. discussed ideas for the sourcing of funds for nuclear projects. The event presents innovative strategies on investment attraction that would be essential in integrating nuclear energy with clean energy.

For example, for nuclear power, in the Europe context, it has already been added to sustainable financing frameworks. This means Finland and France issued green bonds in 2023 that are dedicated to nuclear power. The report has proposed reforms in policies, international cooperation, and regulation updates, which will be instrumental in filling the gap in finance, as well as spur the growth of nuclear power, especially in new markets.