NRI Annual Review 2026 - Flipbook - Page 32
Part I: Global strategic drivers
and macroeconomics
Nuclear energy is rapidly transforming
from a traditional alternative power source
into an indispensable pillar of national
economic and energy security. Dr. Sama
Bilbao y León, Director General of the
World Nuclear Association, was clear in
her view that nuclear power is increasingly
being recognised as a critical component
in addressing the global energy challenges
of climate change, energy security, and
equity, a shift further intensified by broader
macroeconomic and geopolitical shocks.
The 2026 Straits of Hormuz crisis and
subsequent blockade have resulted in a loss
of trust in fossil fuel supply chain reliability,
which is triggering a profound paradigm
shift across industrial sectors and electrical
utilities, prompting the implementation
of state policies that prioritized absolute
dependability of supply.
Concurrently, the exponential expansion of
artificial intelligence architectures and data
centres—which consume up to 400% more
energy than conventional facilities and
demand unyielding, 24/7 power—reinforces
the strategic mandate for clean, reliable
baseload electricity. However, this surge
threatens to make securing energy supply
an intra-national challenge, potentially
delivering an acute cost-of-living issue for
ordinary voters, given that meeting future
needs will require around 40 gigawatts of
new capacity annually until 2050, equivalent
to building roughly 20 large-scale reactors
and 70 SMRs each year for the next
quarter-century.
As a result, nuclear energy is now viewed
as key to many nations’ sovereign energy
policies. Global nuclear electricity output
reached record highs in 2025, supported
heavily by systematic reactor restarts
in Japan and the completion of major
fleet maintenance cycles in France. In
parallel, ambitious capacity expansion was
aggressively pursued across North America,
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Asia, Europe, Africa, and Central Asia.
Dr. Bilbao y León pointed out that major
growth was led by Canada, the United
States, China, India, Russia, and South Africa,
while private capital commitments across
the supply chain were projected to reach
$120 billion by 2030.
The broader climate framework further
solidified nuclear energy’s competitive
positioning. The formal commitment
initiated at COP28 to triple global nuclear
capacity by 2050 expanded to 38 sovereign
states, but there is a note of caution: global
build rates highlight a severe scale-up
deficit that potentially creates an aggressive
seller’s market. Sovereign nations and
corporate entities are likely to compete
fiercely for limited industrial resources,
technical expertise, and capital allocation.
Part II: The evolution of
nuclear security and regulatory
frameworks
The deployment of SMRs is introducing a
complex, highly diverse matrix of legal and
regulatory friction points into the market,
driven by rapid technological maturation
and novel commercial deployment
models. Kimberly Nick, Head of the NEA
Division of Nuclear Law at the Nuclear
Energy Agency, OECD, explained that
authorizing these advanced configurations
was complicated by the urgent industry
demand for predictable, standardized
licensing pathways. However, national
sovereignty remained a fundamental
barrier to international standardization.
Each sovereign state retained absolute
jurisdiction over its domestic nuclear legal
framework and enforced independent
accountability for safety determinations.
This regulatory fragmentation is driving
up project financing costs and causing
execution delays, as developers are forced
to completely re-navigate disparate legal
and technical requirements in every
new jurisdiction.
