The global power grid is facing unprecedented pressure as electricity demand accelerates at a historic pace. Nuclear energy is rising to the occasion, having delivered a record-breaking year of output in 2024. Nuclear capacity is now forecast to more than double by 2050, and Small Modular Reactors are set to be a key part of this growth, with their market predicted to increase steadily over the next ten years.
Surging Demand for Electricity
The International Energy Agency’s (IEA) Electricity Mid-Year Update 2025 projects that global demand for electricity will rise by 3.3% in 2025 and 3.7% in 2026, a rate more than twice as fast as total energy demand growth in the same period. This unprecedented speed means utilities are under immense pressure to find new power sources.
The IEA’s figures are well above the 2015-2023 average annual growth rate of 2.6%, and they follow a 4.4% surge recorded in 2024. This acceleration is being driven largely by broad-based electrification, the proliferation of data centers and heavy industrial needs.
Nuclear’s Record Output
Nuclear energy has recently demonstrated its important role in meeting this demand. Reactors generated a record-breaking 2,667 TWh of electricity worldwide in 2024 according to The World Nuclear Association’s (WNA) World Nuclear Performance Report 2025. This surpasses the previous annual record of 2,660 TWh set in 2006.
This huge amount of electricity was also clean and efficient. WNA reports that 2024 also saw nuclear reactors avoid 2.1 billion tonnes of CO2 emissions, equivalent to double the carbon footprint of the global aviation industry.
Equally impressive, the global average capacity – how much electricity a power source actually produces compared to its maximum possible output – increased to 83%. This is higher than any other source of electricity.
This strong performance is cause for optimism for the nuclear sector, a sentiment reflected by the International Atomic Energy Agency (IAEA). In a recent report about the future of nuclear power, they revised both their low and high case forecasts upward. The latter would see a 2.6-times increase in capacity by 2050, bringing global nuclear capacity from 377 GW in 2024 to 992 GW.
SMRs Support Nuclear Growth
Many communities and industries could benefit from the safe, reliable and clean baseload power provided by nuclear power, but not every site can handle the footprint and logistics of a gigawatt-scale plant.
Small Modular Reactors (SMRs) are rapidly emerging as an important alternative for remote communities, mines, data centers and more. They can be scaled to meet demand, may not need extra land for emergency planning zones, and can come online faster.
In the high case forecast from the IAEA report, SMRs would provide 24% of new nuclear capacity by 2050. As the Agency’s Director General Rafael Mariano Grossi noted during the presentation of the report, “Everywhere I go, people are talking about wanting nuclear energy. … When will Small Modular Reactors come on the market?”
Recent market research reports confirm their potential. While the numbers vary across sources, the SMR market in 2025 is estimated to be somewhere in the range of $6 Billion USD and is projected to grow to between $8 – 10 Billion USD by 2035. With compound annual growth rates (CAGR) across these reports ranging from 3 to 7 percent, it is an important signal that institutional investors are lowering their risk assessment of SMRs and increasingly understanding they will be a vital component of a clean energy future.
The convergence of soaring electricity demand and the optimistic outlook on nuclear energy will fundamentally reshape the global utility landscape. SMRs in particular are uniquely positioned to fill the need for always-on and emission-free power for smaller and more remote applications, making them a critical component of the world’s increasingly electric future.
