The nuclear industry has had a tough go since the triple disaster of earthquake, tsunami, and nuclear crisis hit Fukushima, Japan on March 11, 2011.
Plants were shut down over fear of inadequate safety protocols. Uranium prices plummeted on lack of demand causing widespread pain to producers. Falling prices also crippled explorers when conditions began to deteriorate.
To make matters worse, countries like Japan, France and Germany are even beginning to turn their backs on nuclear energy.
In fact, proposed “nuclear phase outs” by these nations have already begun and are expected to stretch out over the next two decades – possibly signaling the end of the nuclear energy world as we know it.
But as an investor, you should really read the fine print before abandoning nuclear altogether.
Because as you know, not everything you read in the headlines is true.
First of all, as you read this, Japan has three new reactors currently under construction, with ten more plants on order. Their government is also planning to re-open a number of reactors that have been closed since last year’s tsunami.
The French also backtracked and now say that they’re looking to reduce – rather than abandon altogether – the use of nuclear energy by 2025.
Even the Germans admit that it is well off its 2030 target to swap out nuclear power. They cite the cost for clean energy infrastructure as the major setback.
In fact, while all three have announced bold plans to get away from nuclear power altogether – it looks like their governments are quietly doing the opposite.
Because in reality, all three of these nations realize it would be big mistake to abandon nuclear energy altogether.
Nuclear Is Safe
There’s a reason why nations such as China, Russia and India are forging major plans for new reactors for decades to come.
In fact, the World Nuclear Association reports that there are now more reactors being planned than there were before the Fukushima incident.
And one of the major reasons for this surge in interest is the track record of safety nuclear energy has enjoyed since the beginning.
Apart from Chernobyl, no nuclear workers or members of the public have ever died as a result of exposure to radiation due to a commercial nuclear reactor incident.
And an OECD/NEA report in 2010 pointed out that the theoretically-calculated frequency for a large release of radioactivity from a severe nuclear power plant accident has reduced by a factor of 1600 between the early Generation I reactors and the Generation III/III+ plants being built today.
Yes, there is a negative stigma associated with nuclear power.
But when you compare nuclear to say, coal – the difference is eye-opening.
Nuclear Is Clean
One major dilemma facing countries looking to phase out nuclear power is the environmental impact of switching energy sources.
As the IEA’s Chief Economist Fatih Birol warned: “Except for nuclear and renewables, we don’t have many options to produce energy without emissions. If those countries believe that the gap coming from the reduction in nuclear will be 100 percent filled by renewables, they are wrong. There will be gas, coal and even oil.”
Nuclear power generation produces negligible carbon dioxide (a by-product of fossil fuel generation which is the main cause climate change). Independent studies have shown that the full lifecycle carbon emissions of nuclear energy (which include construction, uranium mining, milling and enrichment, fuel fabrication as well as decommissioning) are a fraction of those for fossil fuels and much the same as those of renewables such as wind turbines.
Nuclear Is Cheap
Unlike for fossil fuel generation, fuel costs represent a small fraction of the total operating costs for nuclear power. As a result, generation costs are stable and predictable.
Nuclear Waste Will Soon Be Recyclable
Several European countries along with Russia, India and Japan already reprocess nuclear fuel – the actual materials used to make nuclear energy – to separate and recover the unused uranium and plutonium, reduce waste and safely close the nuclear cycle.
Now China – the future world leader in nuclear energy consumption – say they’ve mastered the technology for reprocessing fuel from nuclear power plants as well, potentially boosting the supplies of carbon-free electricity to keep the country’s economy booming.
The Future For Nuclear Is Bright, And Uranium Is The Way To Play It
Now that you know what the future holds for the nuclear industry, there’s a great way for investors to profit from the coming nuclear resurgence.
And it’s with uranium.
Do you remember the Cold War?
As part of the effort to end the half-century chess match in the early nineties, a treaty was signed between Russia/Soviet Union and the United States to bring low enriched uranium to market each year from the dismantling of nuclear weapons.
The Megatons to Megawatts Program produces roughly 24 million pounds of uranium annually, representing 16% of total demand.
But in June 2013, this 20-year agreement will expire.
Suffice to say, with 1 out of every 10 American homes, businesses, schools and hospitals currently powered by Megatons to Megawatts fuel, a significant supply gap is coming up fast.
Now add to that the more than 60 reactors currently under construction around the globe and a further 160 planned.
Folks, I believe uranium demand will outpace supply very soon.
Prices will have to rise in the near future.
The time to buy is now. Take a position in quality uranium stocks today before the rebound.
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