Source: Economic DailyAuthor: Wang Baokun Recently, the World Bank announced the lifting of its ban on nuclear power financing, marking a major shift in the World Bank’s energy policy.
World Bank President Ajay Banga stated that the World Bank will "re-enter the nuclear energy field" and resume support for nuclear energy
projects, with key focuses including extending the lifespan of existing nuclear power plants and developing small modular reactors (SMRs). It
also plans to deepen cooperation with the International Atomic Energy Agency (IAEA) to ensure nuclear safety standards and non-proliferation supervision. Subsequently, the Asian Development Bank also indicated that it will assess whether to lift similar bans.
The World Bank formally imposed a ban on financing nuclear energy projects in 2013, aiming to avoid investment risks caused by nuclear energy safety hazards and immature technologies, particularly for developing countries. In fact, the World Bank has always been cautious in investing in nuclear energy; its last funding for a nuclear energy project dates back to 1959, when it supported the Latina Nuclear Power Plant project in Italy. This major policy shift by the World Bank signifies that the mainstream attitude toward nuclear energy among major countries worldwide—especially many Western countries that once opposed nuclear power development—has shifted from "restricted utilization" to "active development."
There are several reasons behind this shift:
First, power supply has become a key factor determining the success of the digital economy. The development of the digital economy, especially emerging industries such as artificial intelligence (AI) and data centers, requires substantial power support. The International Energy Agency (IEA) predicts that by 2030, the global power demand of data centers is expected to more than double, with AI becoming the primary driver of the surge in electricity consumption. The Electric Power Research Institute (EPRI) of the United States estimates that by 2030, the electricity consumed by all data centers in the U.S. may account for 9% of the country’s total electricity generation. Without breakthroughs in new technological innovations, nuclear energy will be one of the few options capable of quickly meeting the growing demand for electricity in the short term.
Regarding the Tripling Nuclear Energy Declaration reached at the 28th United Nations Climate Change Conference (COP28) held in the United Arab Emirates in 2023, 31 countries have so far committed to tripling their nuclear power installed capacity by 2050 compared to 2020. However, a Goldman Sachs report points out that due to long project cycles and limited financing channels, the actual fund disbursement rate is less than 60%, making financing difficulties a bottleneck for nuclear power development. The World Bank’s lifting of the financing ban couldn’t have come at a better time. With the Asian Development Bank subsequently indicating it will assess lifting similar bans, policy-driven momentum is expected to trigger a wave of global nuclear power financing.
Second, the attitudes of major countries worldwide have shifted. The United States, France, Germany, the United Kingdom, Japan, and others have all expressed support for strengthening nuclear power financing to promote nuclear energy development, accelerating the trend of global nuclear power revival.
As the largest shareholder of the World Bank, the new U.S. administration signed four executive orders in May, planning to start the construction of 10 large-scale nuclear power plants by 2030 and increase nuclear power capacity from 100 gigawatts (GW) in 2024 to 400 GW by 2050. Germany, another major shareholder, has abandoned its strong anti-nuclear stance. According to the latest German public opinion poll in May, 55% of German citizens support the resumption of nuclear power, an increase of 23 percentage points compared to three years ago. The new German government has also stated that it will no longer obstruct the EU’s nuclear energy development policies. On June 10, the United Kingdom announced it would provide $19.3 billion in funding for Sizewell C, a new nuclear power plant in southeastern England. This project is expected to create approximately 10,000 jobs during construction and supply sufficient electricity to around 6 million households after commissioning. The French government has extended the lifespan of reactors and is developing next-generation nuclear reactor technologies. More than 10 developing countries, including Egypt, Bangladesh, Indonesia, and Turkey, have officially launched nuclear power construction plans, while about 20 other developing countries are in the stage of active planning or exploration.
Third, nuclear power technology has been upgraded to be safer and more efficient, with SMR technology in particular gradually maturing. As a new generation of nuclear reactors, SMRs offer advantages in cost, efficiency, and safety. They can also provide flexible power supply for different regions, environments, and electricity demand scenarios, with accident risks significantly lower than those of traditional reactors.
Currently, major countries around the world are increasing investment in the R&D and application of SMRs, and small-scale nuclear power projects have become a development trend. China, Russia, and the United States are at the forefront, followed by Canada, the United Kingdom, Japan, France, and other countries—all of which are conducting independent or collaborative R&D on safer and more efficient small modular reactors. In addition, to meet the electricity demand of AI and big data center development, global technology giants such as Google, Amazon, and Oracle have also announced their investment in SMR R&D, striving to gain a first-mover advantage in the digital market. In the foreseeable future, international market competition for SMRs will become increasingly fierce.
Fourth, there is a balance between climate goals and development needs. As a baseload power source that can replace traditional fossil energy on a large scale, nuclear power has the advantages of cleanliness and stability. Considering the entire production chain from raw material extraction to electricity generation, the carbon dioxide emissions of nuclear power plants are 1/70 of those of coal-fired power plants and 1/3 of those of solar power plants. By signing the Tripling Nuclear Energy Declaration, 31 countries have essentially chosen a development path that relies on the vigorous development of nuclear power to meet electricity demand and achieve emission reduction targets. Many private technology enterprises have opted to sign long-term nuclear power procurement agreements to support the decarbonization needs of their data centers.
The World Bank’s policy shift will not only accelerate the global revival of nuclear power—especially the commercialization of SMRs—but also provide more options for developing countries to achieve low-carbon energy development. However, whether nuclear power development can truly usher in a "spring" still depends on addressing key issues such as innovation in financing models, reconstruction of safety trust, and coordination among multilateral institutions.
English
