Denmark is establishing a new nuclear power fund with the aim of raising €350 million ($397 million) to support the development of small modular reactors (SMRs) and advanced nuclear technologies. The initiative marks a significant shift in Danish energy policy as the country looks to diversify its energy mix and meet rising electricity demand, driven by the expansion of data centres and the electrification of heavy industries.
The fund is backed by a coalition of Danish pension funds, private investors and energy companies, signalling a departure from Denmark’s traditional reliance on renewables, particularly wind power. Historically, Denmark has refrained from pursuing nuclear energy, but the surging electricity requirements of data centres and industrial sectors have prompted a reassessment.
Data centres, which consume large amounts of electricity for operations and cooling, are a major contributor to the growing energy demand. The global boom in artificial intelligence applications has further intensified this trend, with AI models requiring significant computational power. In Denmark, several major technology firms are planning large-scale data centres, with some projects expected to demand up to 960 megawatts of electricity — placing new strains on the country’s renewable energy infrastructure.
The proposed nuclear fund aims to invest in SMRs, smaller and more flexible nuclear reactors capable of delivering reliable, low-carbon power. SMRs are viewed as a solution to the intermittency challenges of wind and solar energy, offering consistent generation to complement variable renewables.
Proponents of the fund argue that nuclear energy must form part of Denmark’s transition to a low-carbon economy. They stress the need for a diversified energy portfolio combining renewables and nuclear to safeguard energy security and meet emissions reduction targets. Supporters also suggest that Denmark, with its established industrial capabilities and energy expertise, could position itself as a leader in nuclear innovation.
However, the initiative has drawn criticism from environmental groups and some political parties. Opponents argue that Denmark should focus exclusively on expanding renewable energy capacity and improving energy efficiency, raising concerns about nuclear waste management and the high costs associated with nuclear infrastructure. The Danish government’s role in the initiative is regulatory, ensuring investments adhere to national energy policies and safety standards. While the government has not contributed direct funding, it has signalled openness to the development of nuclear technologies that align with Denmark’s climate objectives.
