Nuclear power market is estimated to be valued at USD 35.27 billion in 2024, growing at a CAGR of 3.9% over the forecast period (2024-2031). Growing government initiatives to reduce carbon emissions and increasing investments in new nuclear power plants are some of the key factors boosting the demand for nuclear power. Furthermore, the focus on achieving energy independence and security through domestic nuclear programs will also significantly contribute to the growth of the nuclear power market.
Strong government support and investment promotion policies to boost nuclear energy adoption across countries will remain a key driving factor for the global nuclear power market. Many governments are promoting private investment through tax exemptions, financing incentives, and long-term power purchasing contracts. This has led to a rise in new nuclear reactor construction projects world-over. In addition, the increasing demand for reliable base load power generation capability and energy imports has necessitated the expansion of nuclear energy programs globally. The introduction of smaller, safer, and cheaper nuclear power plant designs will further foster new plant builds and boost nuclear power capacity additions over the coming years. However, challenges like high capital costs and strict regulatory compliance may negatively impact the industry expansion to some extent over the forecast period.
Increasing demand for clean and reliable energy source
One of the major drivers for the global nuclear power market is the increasing demand for a clean and reliable source of energy globally. Nuclear power is a low-carbon energy source that produces negligible greenhouse gas emissions during operation. It provides reliability as the plants can generate continuous power for long periods without being dependent on weather conditions like solar and wind. This makes nuclear energy an attractive option for nations looking to reduce their carbon footprint and meet their climate change commitments under the Paris Agreement. The rising concerns over climate change and desire to switch from fossil fuels to cleaner sources of energy are driving many countries to invest more in nuclear power.
Growing energy needs of developing economies
Another key driver is the rapidly growing energy needs of developing economies like China, India, and countries in Southeast Asia. As the economies of these nations expand and populations increase, the demand for electricity also rises exponentially. Nuclear power can help meet this rising baseload energy demand efficiently without compromising on development. It allows countries to power economic growth and improve living standards of citizens through access to affordable and reliable electricity. Several developing countries are pursuing nuclear energy programs to satisfy their long-term electricity requirements. This growing nuclear power demand from emerging markets is a major factor propelling market growth.
High capital costs of new nuclear plants
One of the major restraints faced by the nuclear power industry is the very high upfront capital costs associated with building new nuclear plants. Modern nuclear reactors have huge price tags running into billions of dollars. The construction of nuclear power facilities requires massive investments and takes several years to complete. This makes nuclear energy a relatively expensive option compared to other renewable sources. The high capital intensity and long construction periods deter many utility companies and nations from investing in new nuclear programs.
Unresolved issues around nuclear waste storage
Another major challenge is dealing with nuclear waste generated from reactors. No long-term technical solutions currently exist for permanently storing highly radioactive nuclear waste. Spent fuel rods have to be stored securely for thousands of years which raises serious environmental and public safety concerns. The unresolved nuclear waste storage problem and lack of consensus on permanent geological repositories discourage expansion of nuclear power globally.
Rise of small modular reactors
Emerging technologies like small modular reactors (SMRs) are opening up new market opportunities. SMRs offer improved safety features, lower upfront costs, and modular construction that makes them more financially viable. They can also be deployed at smaller scales suitable for developing countries. Many SMR designs are being developed and tested which could drive new construction if commercialized. This novel reactor category presents an opportunity to revive nuclear power demand and projects globally in the coming decades.
Focus on closing fuel cycle
Another opportunity lies in closing the nuclear fuel cycle to enhance resource efficiency and reduce waste. Reprocessing spent fuel to extract unused uranium and plutonium can help reduce the volume of waste and extend the life of uranium reserves. Countries are actively pursuing advanced reprocessing technologies and fuel recycling options like advanced burner reactors. If commercially proven, these solutions could help resolve nuclear waste issues and boost the viability and public acceptance of nuclear energy.
*Link: https://www.coherentmarketinsights.com/market-insight/nuclear-power-market-5063
Key Developments
- On February 22, 2024, Prime Minister Narendra Modi will inaugurate two domestically built reactors with a capacity of 700 MW each at the Kakrapar nuclear power plant.
- In 2022, the Chinese state-owned nuclear power developer announced plans to construct a power plant in Argentina utilizing the advanced third-generation Hualong One design.
- In 2022, China and Argentina signed a significant agreement worth USD 8 billion for the construction of a nuclear power plant in Argentina.
- In December 2021, GE Hitachi Nuclear Energy secured a partnership with Ontario Power Generation to serve as the technology partner for the Darlington New Nuclear Project, located east of Toronto. As part of the collaboration, GE Hitachi will assist in the development of a BWRX-300 small modular reactor at the Darlington site, with a projected completion date as early as 2028.
Key Players
GE-Hitachi Nuclear Energy Inc., Westinghouse Electric Company LLC, STP Nuclear Operating Company, SKODA JS AS, China National Nuclear Corporation, Bilfinger SE, BWX Technologies Inc., Doosan Heavy Industries & Construction Co. Ltd, Mitsubishi Heavy Industries Ltd, Bechtel Group Inc., Japan Atomic Power Co., Rosatom Corp., KEPCO Engineering & Construction, Areva, Framatome , Bharat Heavy Electricals Limited, and SENPEC