Financial Association News on September 23rd (Editor: Zhao Hao) According to media reports, 14 large banks and financial institutions globally will commit to increasing their support for nuclear energy. Several countries' governments and industries hope that this move will provide support for the financing of the latest wave of nuclear power plant construction.

It is reported that these 14 financial institutions are Bank of America, Barclays, BNP Paribas, Citigroup, Morgan Stanley, and Goldman Sachs, as well as the Abu Dhabi Commercial Bank, Ares Management, Brookfield, Credit Agricole CIB, Guggenheim Securities, Rothschild & Co, Segra Capital Management, and Industrial Bank of France.

These financial institutions will attend an event with John Podesta, Senior Advisor on International Climate Policy to the US President, in New York on Monday (September 23), where they will announce their support for the goal mentioned at COP28 last year to triple global nuclear energy capacity by 2050.

It is understood that this event is part of the 'New York Climate Week' that kicked off on Sunday, September 22. Major banks have not yet specified their specific action plans, but nuclear energy experts say that the public support of these institutions for nuclear energy has long been anticipated by the outside world.

The International Atomic Energy Agency (IAEA) raised its expectations for nuclear power prospects in the recently released 'Energy Electricity and Nuclear Energy Forecast for 2050' report. Under the high scenario model, nuclear power capacity in 2050 is projected to increase by 2.5 times the current capacity. Experts generally believe that nuclear energy will play a crucial role in the low-carbon energy transition process.

World Nuclear Capacity Forecast Model Source: IAEA

However, financing difficulties and high costs have always been the main obstacles to building new nuclear power plants. With the latest commitments, banks are expected to support new power plants through increasing direct loans and project financing for nuclear power companies, arranging bond sales, or introducing companies to private equity or credit funds.

George Borovas, a member of the World Nuclear Association's management committee, stated that banks often find it difficult to support new nuclear projects because such projects require approval from top management. "Senior bank management will say, 'We know nothing about nuclear energy. We only know that nuclear energy is very challenging and controversial.'"

"This event will be a key game-changer," added Borovas, mentioning that bank support will help normalize nuclear energy as part of the solution to climate change.

BNP Paribas stated that without nuclear energy, achieving carbon neutrality by 2050 in any scenario is impossible. Barclays believes that participating in the project is because nuclear energy can address the intermittency issues of wind energy and cecep solar energy.

Last Friday, Microsoft announced a 20-year power supply agreement with Constellation Energy, who will also restart a nuclear reactor at Three Mile Island in Pennsylvania, USA. Earlier this month, Oracle announced the construction of three small nuclear power plants to supply power to its giant datacenter under development.

Senior executive James Schaefer of Guggenheim Securities stated, "When you see these technology companies investing in nuclear energy through contracts, things start to happen, and we are in talks with them. The role of banks is to connect clients and investors with the producers and owners of this technology."