“This news that the world breached 1.5C warming in 2024 comes as demand for energy is growing. One after another, technology companies looking for reliable low-carbon electricity to power AI and data centres are turning to nuclear energy, both in the form of traditional large reactors and SMRs,” Director General Rafael Mariano Grossi in La Revue de l’Énergie”
As the world faces an ever-increasing demand for clean, green and reliable energy, the requirements for support of big data centers and Artificial Intelligence (AI) are also intensifying. 14 of the world’s largest banks have committed to increasing support for nuclear energy. With their commitments to achieve Net Zero Carbon emission, big tech companies are now weighing up the use of nuclear energy to support their breakneck data center growth. This is an opportunity for big tech companies in Pakistan to invest in SMRs to support their growing need to power data centers while combating climate change through Net Zero.
AI-driven data centers require a tremendous amount of energy. Currently, mega tech companies like Alphabet, Microsoft, Meta, Amazon and others combined consume 1-2 percent of energy. This figure is expected to double in the next decade as the world relies more on digital and AI driven data infrastructure. All these companies have also pledged to achieve NET ZERO and reduce their carbon footprints. Regarding carbon footprint of AI, the energy consumed is approximately 1,287 MWh while training or using large AI models like OpenAI (GPT3). This means that while consuming this energy, they can emit approximately 550 Metric Tons of CO2. This is equivalent to CO2 release via at least 125 flights from New York to London. Tech companies are integrating these large models into vast use of internet from online search to emails.
The strategic shift between finance, technology and nuclear power highlights the dire need to increase the reliance on nuclear energy.
One solution for tech companies could be the adoption of Small Modular Reactors (SMRs) for big data infrastructures. According to the reports, the Global SMR market growth is expected to be 2.68 times more than $5 billion in 2022 to approx. $13.4 billion in 2032. Bill Gates, being a founder of Breakthrough Energy, and founder and chairman of TerraPower – is also focused on nuclear energy. Moreover, Satya Nadella, CEO of Microsoft has already hired principal program manager for nuclear technology “responsible for maturing and implementing a global SMR and microreactor energy strategy” as Microsoft gears up for “the next major wave of computing” to make data centers more efficient, according to Nadella. This strategic shift between finance, technology and nuclear power highlights the dire need to increase the reliance on nuclear energy in the energy mix for a sustainable AI-driven world. In the case of SMRs, this strong support can further prompt important stakeholders to enhance – at a faster pace – harmonization and standardization of SMR design, construction, regulatory and industrial approaches. SMRs are more reliable as they can provide uninterrupted power supply to data centers around the clock. The AI revolution is inevitable, hence, there is a dire need to prioritize nuclear power as the backbone of AI infrastructure thereby, SMR technology is worth exploring.
Pakistan has been using nuclear energy for peaceful purposes in the realm of electricity production, socio-economic uplift of the people, agriculture, healthcare and having clean and green environment while combating climate change. SMRs are a case in point to reach the remote off-the grid areas for Pakistan. Similarly, data centers in Pakistan are on the rise with 22 in 2024 where there is an increasing need for powering such centers. There is an opportunity for tech companies to develop energy-efficient data centers powered by SMRs. Fo this, tech companies in Pakistan including software developers, cloud providers and system integrators can join hands with private and public energy producers for partnership regarding coinvesting in pilot SMRs.
This public-private partnership (PPP) will require equitable division of financial and operational responsibilities for the implementation of SMRs. For the public and private energy companies, the pivotal role can be played regarding integration of SMRs in the energy mix by lowering financial barriers. This can be done though offering low interest loans, tax benefits as well as government-backed guarantees. This will help encourage private companies to invest in R&D of SMRs in Pakistan. Such enabling environment for SMRs in Pakistan could also help accelerate global adoption of SMRs, thereby, demonstrate Pakistan’s commitment to sustain energy solutions via nuclear power.
Regarding the involvement of tech companies, India’s Nuclear Power Corporation of India Ltd (NPCIL), under the Ministry of Atomic Energy, has advertised the request for proposals (RFPs) from private companies regarding the development of Bharat Small Reactors (BSRs) in India. Companies like Tata Sons have already shown interest in nuclear energy projects. Similarly, Pakistan’s leading local IT giants need to step forward to champion the role of nuclear energy in further reducing carbon emissions. Their rigorous advocacy in this domain can help highlight SMRs as foundational for Pakistan to go down the road of an AI-driven as well as energy-efficient infrastructure.
According to the World Nuclear Association, “Financial institutions can provide experience, global presence, services and solutions to support the nuclear energy industry.” In this regard, Pakistan’s government banks like National Bank of Pakistan as well as private banks including Habib Bank Limited need to further their commitment to achieve net zero carbon emission by pledging the support for nuclear energy in Pakistan. Case in point will be their crucial support for nuclear energy projects like SMRs. Think tanks in Pakistan which deal with civil uses of nuclear energy can also play an important role in this domain. As a primary step, they already counter consistently the misunderstanding regarding nuclear energy. For this, time and again, thinktanks like Center for International Strategic Studies Islamabad, go back to basics of how safe, efficient, reliable and clean nuclear energy is via seminars, conferences, lectures, IHDs and webinars. In the second phase, there is a need for such thinktanks to collaborate with public and private partners for dedicating seminars and conferences to evaluate as well as promote SMRs. This will serve as a platform to foster dialogue between public, academia, policy makers, banking sector and industry leaders regarding the potential of SMRs as enablers to meet energy demands of AI-driven data centers in Pakistan. This will help create a collaborative environment in Pakistan for adoption of SMRs.
In 2024, at CISS Islamabad DG IAEA stated, “Pakistan has technical and engineering capacity for new nuclear power plants including Small Modular Reactors (SMRs), which indicates a promising future for nuclear energy.” DG IAEA’s visit to Pakistan this February is a testament to Pakistan’s commitment to promote nuclear energy for a sustainable, clean and green future- as a founding member of the IAEA. The aforementioned integrated approach will support not only a nexus of nuclear energy and AI but also promote Pakistan as a regional leader steering the Global South – side by side with the IAEA – in advancing nuclear technology for an AI-driven and AI-ready, clean and green future.
The writer is an Associate Director at the Center for International Strategic Studies (CISS) Islamabad and is also a Project Associate at the University of Leicester, UK led by Professor Andrew Futter. She can be reached @Anum_A_Khan