Page 23 - DIY Investor Magazine | Issue 36

3) Nuclear is clean
Nuclear energy generates the lowest greenhouse gases of any power source, period. Over the full life cycle of nuclear power production, each gigawatt-hour of electricity contributes about three CO2 equivalent emissions per gigawatt-hour of electricity, which is in line with wind and solar. Hydroelectric power sources generate 10 times more CO2 equivalent emissions; oil and coal generate 240 and 273 times more, respectively.
‘NUCLEAR POWER HAS THE POTENTIAL TO PROVIDE HIGH-IMPACT CHANGE THAT CAN SIGNIFICANTLY MOVE THE NEEDLE’
The energy crisis encouraged governments to turn to nuclear energy while the Cold War saw governments stockpile uranium for potential military use. This strong demand resulted in a
bull market between 1973 to 1978. The next bull market came during the commodity supercycle of the 2000s. Surging oil prices resulted in many expecting a renaissance in nuclear energy. That bull market ended with the onset of the Global Financial Crisis and the requestioning of nuclear energy following the 2011 tsunami-driven accident at Fukushima, Japan.
The reaction to that incident, however, is increasingly seen
as rash and misguided. Today, we believe we are at the start of a new bull market in uranium. Crucially, there is a deficit in uranium supply. The production of uranium has simply not kept pace with the growing demand for new reactors.
Until recently, the gap between production and demand had little impact on the spot price. This was due to the availability of stockpiles made available at the end of the Cold War. With the de-escalation of tensions, weapons stockpiles were released for use in power plants. However, the availability of that supply is coming to an end. Uranium miners will need to step up production to plug the gap.
More information about Sprott Uranium Miners UCITS ETF here >
SPROTT URANIUM MINERS UCITS ETF LAUNCHES IN LONDON TO TAP INTO NUCLEAR ENERGY TREND
23
Dec 2022
DIY Investor Magazine ·
CO2 Equivalent Emissions per Gigawatt-Hour
Nuclear
3
Wind
4 Solar
5 Hydro Biomass
Natural Gas Oil Coal
34
154
Source: Energy.gov. Measures CO2-equivalent per gigawatt-hour of electricity over the life cycle of a powerplant.
A NEW URANIUM BULL MARKET?
The changing sentiment toward nuclear power is driving the first signs of a new uranium bull market.
Since the advent of nuclear energy, uranium, as a commodity, has seen two other bull markets. The first was in the 1970s. The defining feature of that decade was an energy crisis, due to the OPEC oil embargo, and geopolitical tensions, in the form of the Cold War.
490
720
820