Investing.com — U.S. nuclear energy is poised for significant growth, with two key themes shaping the industry’s future: expanding domestic capacity and localizing the enriched uranium supply.
According to Daiwa Capital Markets, these developments could unlock billions in new markets while reshaping the energy landscape.
Nuclear equipment
Daiwa explained in its research note to customers that the US Department of Energy (DOE) aims to add 35 gigawatts (GW) of new nuclear capacity by 2035, a 36% increase over 2023 levels. This would be part of a broader target to triple capacity by 2050, as announced at COP29.
The company notes that achieving this milestone would require an annual addition of 15 GW from 2040 onwards, which would contribute to net-zero emissions targets. Daiwa estimates that this growth trajectory will open a $101 billion market for nuclear power equipment manufacturers.
Daiwa believes in the ‘long-term growth story’ [is] reattached with [the] US eyes 35 GW of additional capacity by 2035; a $101 billion market that needs to be unlocked.”
They add that companies like GEV, BWXT and Fluor (NYSE:) are positioned to benefit, given an estimated capital cost of $6,041 per kilowatt.
Enriched uranium
The company notes that a recent Russian counter-ban on enriched uranium exports to the US has intensified efforts to localize nuclear fuel supplies.
Russia currently accounts for 44% of the world’s uranium enrichment capacity. The US ban on Russian uranium, which came into effect in May, is creating a 27% shortfall in domestic demand for enriched uranium.
Daiwa expects a $443 million market for domestic enrichers, with companies like Centrus energy (NYSE:) and Honeywell (NASDAQ:) as beneficiaries.
While uranium oxide (U3O8) supplies remain robust and cover 2.9 years of demand, “nuclear fuel localization is now likely a priority,” Daiwa said. The growth in enrichment is likely to outweigh the benefits to miners in the short term.
Daiwa sees the US nuclear revival as part of a global trend, with similar optimism about China’s nuclear ambitions indicating a robust outlook for the sector.
