Global nuclear power generation is expected to reach a record high this year. With the US committed to tripling its nuclear power capacity by 2050 alongside the energy demand coming from artificial intelligence, which is expected to increase, uranium is solidifying its position as a cornerstone of the global energy transition. Although recent developments in seemingly more efficient Chinese AI language models shifted markets’ stance on the power needs for US data centres, the Trump administration’s nuclear drive is expected to maintain this pace to ensure domestic energy security.
Nuclear is moving into the mainstream on two main catalysts: energy security and energy transition.
In the recent years, we have witnessed a boost in the energy mix shift in terms of geographical exposure and energy sources. Broader energy security has become central, and the entire commodities supply chain and trade management have been revisited. At the same time, pressures on governments from reaching green transitioning targets are intensifying. Thus, the role of nuclear energy is becoming increasingly important in the global energy mix, given that it’s clean, reliable and efficient.
Against this backdrop, the International Atomic Energy Agency (IAEA)‘s forecast for nuclear power has risen for the fourth consecutive year, nuclear energy generation might increase 2.5-fold by 2050. Indeed, nuclear power can help the economy shift away from fossil fuels and accelerate economic growth.
Alongside the continuing increase in electricity and nuclear power demand the uranium market might be supported by supply concerns and efforts by western countries to achieve energy independence. Outcomes from COP29, which took place in November 2024 in Baku, Azerbaijan, have reinforced nuclear energy commitments, with the US pledging an additional 35 GW of nuclear capacity over the next decade, with a view to triple this by the middle of the century. Legislative initiatives, such as the bipartisan “Advance Act” (Advanced Nuclear for Clean Energy), are further accelerating the construction of new reactors in the United States.
While geopolitical uncertainties and supply risks, such as restricted uranium exports from Russia, pose challenges, these factors could boost demand for Western uranium enrichment and conversion capacities. Coupled with growing energy consumption driven by AI expansion, this places uranium as a critical component of the global energy transition. Despite the pause in uranium’s bull market in 2024, the current landscape appears to support a positive outlook.
Advancements in nuclear energy technology are driving global uranium demand, with healthy progress in Europe, Asia and the US. In recent weeks, US regulators have taken steps to expedite power plant construction and streamline reactor approval processes. Meanwhile, Russia continues to expand its dominance in nuclear power, building over ten nuclear units overseas.
Elsewhere in Europe, where nuclear energy is once again being identified as a key component of the continent’s energy mix, Poland has allocated $14.7bn to build its first nuclear power plant, with discussions underway for a second facility. French companies are especially keen to participate in the expansion of nuclear production, particularly as France is soon to connect its first new reactor to the electricity grid in 25 years and push forward with advances in compact modular reactor designs. France has already increased its nuclear production prediction for 2025 and 2026, with financing plans for six new nuclear reactors also in the works.
Nuclear power is also a growing priority in Asia. Japan’s draft energy policy calls for nuclear energy to contribute 20% of the country’s energy by 2040, which is crucially backed by public support. India’s nuclear capacity is set to triple by 2032, following significant growth over the past decade. Furthermore, South Korea and the US have signed a memorandum of understanding to collaborate on nuclear energy exports and private nuclear power generation, strengthening bilateral cooperation. China, in particular, has the most ambitious plan to construct around 150 new reactors in less than a couple of decades. The monumental project might lead China to triple its nuclear energy capacity and become the largest nuclear power producer, outpacing the EU and the US in the next few years.
On the supply side, nations are focusing on reducing dependency on other markets in the nuclear fuel cycle. The US Department of Energy has selected six vendors for low-enriched uranium contracts, with agreements valued at up to $3.4bn over 10 years. However, supply chain challenges persist. Kazakhstan’s Inkai project has suspended production due to bureaucratic delays, while Canada is contemplating tariffs on uranium exports to the US in response to President Donald Trump’s proposed tariffs. On the other hand, some supply constraints may ease; Trump has pledged to resolve the Russia-Ukraine conflict quickly, potentially leading to the lifting of restrictions on Russian-processed uranium by late-2025.
