nuclear-news

Nuclear energy could double by 2050, but AI-driven power demand does not change the economic case

New global assessment finds nuclear is not cost-competitive with solar and wind in most countries, despite renewed interest arising from AI datacentres and energy security concerns

Key findings:

• Global nuclear capacity could grow 2–3x to ~550–1,000 GW by 2050, holding a ~10% share as electricity demand also grows 2–3x. Reaching ETC’s central estimate of ~750 GW requires new build to rise 3–5x, from 5 GW/year over the past 20 years to 15–25 GW/year, and investment to rise from ~$50bn to ~$200bn a year.
• Small modular reactors remain 1-2 decades away from wide deployment, despite attracting large investment and political attention amid surging AI-driven power demand. Early US cost estimates range from ~$140–270 per MWh, well above the large reactor cost range of $40–190 per MWh.
• Similar reactor designs can cost 4–9 times more to build in the US and Europe than in China and South Korea – financing costs are key factor.
• Russia controlled 40% of global uranium enrichment capacity in 2025, and key nuclear equipment manufacturing is concentrated in just five countries. Nuclear supply chain concentration poses the greatest risk, rather than safety and waste management.

London, 6 October 2026 — Surging power demand from AI data centres and energy security fears sharpened by the Russia-Ukraine war and the Strait of Hormuz crisis have revived interest in nuclear power. A new report from the Energy Transitions Commission, The Role of Nuclear in the Energy Transition: Complementary but Limited, offers a measured assessment: nuclear could provide up to 10% of global electricity supply by 2050 — roughly doubling today’s 380 GW capacity to 750 GW — but expansion only makes economic sense in a limited number of countries. Delivering this share requires average new nuclear capacity to grow to 15–25 GW annually until 2050, from an average of 5 GW per year over the past 20 years, backed by $200bn annually compared to $50bn today. This high deployment rate was previously achieved in the 1970-80s across the US and EU, in part driven by an oil crisis.

The vast majority of the remaining 90% of decarbonised electricity will come from solar and wind, which are cheaper and faster to build in almost every country. In most developed countries, new solar and onshore wind are typically 20–50% cheaper than new nuclear, while offshore wind costs are comparable or lower. Cost reductions in battery storage are increasingly enabling solar and wind to provide cost-competitive ‘round the clock’ power.

“The nuclear debate has been too binary for too long: reject it outright over safety and waste concerns or insist it must carry the whole transition. This report settles it with evidence: extend existing plants where safe, and build new ones  where costs can be managed to competitive levels. On average this might mean 10–20% of a country’s future power generation coming from nuclear plants. In most places, however, solar and wind win decisively on cost, speed and security. So for countries without existing nuclear delivery capabilities, diverting resources to nuclear will increase costs and delay the transition.” said Adair Turner, Co-Chair of the Energy Transitions Commission.

“SMR investor hype was built on cost assumptions that have not materialized. US SMR CAPEX estimates have inflated from $3,000–10,000 per kilowatt to $12,000–15,000 per kilowatt in just a few years, hit by the same cost overruns as large reactors. Costs will only fall with manufacturing scale and standardisation, but with over 70 competing designs, achieving either will take time. SMRs may have a role in the 2040s, but deployment at scale in the 2020s is unlikely. For businesses needing reliable clean power, grid-scale renewables plus storage and power purchase agreements with existing nuclear are proven, cheaper alternatives.” said Jules Kortenhorst, Co-Chair of the Energy Transitions Commission.

SMR hype is outpacing the technology’s readiness

Small modular reactors (SMRs) are attracting heavy investment amid AI’s power surge, and pilot projects are underway in China and Canada, but the ETC estimates widespread deployment will not occur until the late 2030s and 2040s and only if costs decline. Early US cost estimates range from ~$140–270 per MWh, well above the large reactor cost range of $40–190 per MWh. While modular reactor designs could reduce costs by 20–30%, this depends on design consolidation from over 70 competing SMR designs globally and standardisation across regulations in different countries to enable sufficient project pipelines and cross-border learning effects.

Why nuclear is economic in some countries, but not most

A country’s optimal nuclear share depends on two factors: the nation’s ability to deliver projects quickly at competitive costs, and the benefit to the electricity system. Similar nuclear designs cost 4-9 times more in US and Europe than in China and South Korea, and result in over 3 times higher final electricity prices. The gap reflects: higher standardisation and replication in recent Chinese and South Korean projects, leading to shorter construction timelines compared to “first-of-a-kind” Western projects; more effective regulatory architecture in fleet-build programmes; and lower financing costs. Chinese state-backed projects raise capital at around 1–3%, compared with 8–10% for privately financed projects.

Benefits to the grid vary greatly by country. The UK, with expensive offshore wind and high balancing costs, could economically support up to 20% nuclear generation instead of increasing reliance on ultra-long duration storage and overbuilding renewable capacity. In India, the optimal share of nuclear is only roughly 10%-20%, as abundant solar resources paired with batteries provide the cheapest source of electricity. Countries with lots of renewable resource and no established nuclear industry—for example, most of Sub-Saharan Africa, Latin America and Australia—have no economic case for nuclear; the same institutional and financial resources devoted to renewables deliver faster, cheaper decarbonisation.

Lifetime extensions are safe and the most cost-effective new capacity

The cheapest path to maintaining nuclear capacity is safely extending existing reactor lifetimes from 60 to 80 years. Life extensions cost $500–$1,100 per kilowatt versus $2,000–$18,000 per kilowatt for new builds, yielding electricity costs below $40 per megawatt-hour. 12 US plants have been approved for 80-year operation since 2019. Extending existing global capacity to 80 years could retain 230 GW that would otherwise retire by 2050, reducing new-build requirements by a third.

Russia’s stronghold on supply chains is nuclear’s vulnerability

Approximately 40% of global uranium enrichment capacity in 2025 ran through Russia. It supplied around 20% of EU enriched uranium in 2024, even after the EU took measures to reduce Russian imports after the invasion of Ukraine. Reactor pressure vessels, turbines and control systems are manufactured in just six countries: France, South Korea, Japan, the US, China and Russia. While in aggregate, supply chain capabilities can meet the ramp up in nuclear build rates needed to reach up to 1,000 GW by 2050, it could take a decade or more to diversify these capabilities to reduce nuclear supply chain concentration.

Download the report: https://www.energy-transitions.org/publications/nuclear-in-the-energy-transition/

October 11, 2026 Posted by Christina Macpherson | business and costs, ENERGY | Leave a comment