Taking a U-turn: the world may be ready to embrace nuclear

Published Date: June 18th, 2024 | Author: Jake Coulson

Nuclear energy has been the subject of much debate. Whether or not to take the leap, that is to say, to embrace nuclear en masse, is one of the greatest questions of our age.

There are two prominent factors that have thrust nuclear into the public discourse.

The first, is the energy transition. Around 145 countries around the world have announced, or are considering, net-zero targets. This comprises close to 90% of global emissions.

Achieving net-zero means decarbonising electricity – renewable energy has been presented by many as the ideal solution given that it tends to produce very few lifetime greenhouse gas emissions. However, there are concerns over intermittency in some cases; a solar panel is rendered almost useless at night, or in regions with sparse sunlight. Similarly, wind turbines are unlikely to keep the lights on without wind.

Nuclear energy, by contrast, is generated around the clock, regardless of climate. Moreover, studies suggest it produces fewer lifetime carbon dioxide (CO2) emissions per gigawatt-hour (GWh) then the likes of wind, solar, and hydro power.

Comparison of CO2 equivalent emissions per gigawatt-hour among energy sources

Uranium Mining

Source: Our World in Data.

The second factor is energy security. In recent years, geopolitical tensions have mounted, epitomised by Russia’s full-scale invasion of Ukraine in 2022. Russia is the third largest oil producer in the world, with 60% of its exports going to Europe before the invasion, and it is typically the world’s largest gas exporter. A deterioration of diplomatic relations with Russia exacerbated a mounting energy crisis and demonstrated that imports of Russian oil and gas ought not to be relied upon.

Once again, nuclear energy provides a potential solution. Uranium production is largely concentrated in Kazakhstan, followed by Australia, Namibia, Canada, and Uzbekistan. As such, it is relatively abundant and can be sourced from a range of politically diverse countries.

Moreover, a nuclear power plant usually stores fuel supplies for up to two years, making it more immune to geopolitical shocks. Large amounts of energy can be generated predictably and reliably, with relatively small amounts of fuel thanks to uranium’s unique concentration.

So, what are we waiting for? Many countries have already taken the leap. As of this year, there are 437 nuclear power plants operating worldwide, with 61 under construction, and a further 113 planned.

Operational, under construction, and planned nuclear power plants worldwide

Uranium Mining

Source: World Nuclear Association as of 10/01/2024.

But some are still uncertain. Public opinion on embracing nuclear energy had been marred by the well-publicised incidents at Chernobyl in 1986, and Fukushima in 2011. Japan, wherein the latter and more recent of those two incidents occurred, suspended nuclear power by 2013 and relied almost solely on liquefied natural gas (LNG).

We are now seeing a shift – as at time of writing, Japan has restarted 12 of its nuclear power plants, with 5 that have passed review and are ready to be restarted, and a further 10 pending review. It would seem that the aforementioned necessity to achieve decarbonisation and energy security have moved the dial in nuclear’s favour, despite both Chernobyl and Fukushima being in living memory.

It is worth noting that nuclear power is responsible for the second lowest mortality rate per terawatt-hour (TWh) of energy produced, including the deaths linked to Chernobyl and Fukushima. RBMK-class reactors, typified by the Chernobyl disaster, have since been mostly decommissioned, or retrofitted with safety updates.

Mortality rate per TWh of energy produced

Uranium Mining

Source: Our World in Data.

Elsewhere, Italy had long voted against embracing nuclear power in several referenda, but this month has espoused an aim to reintroduce it. Italy’s minister for the environment and energy security, Gilberto Pichetto Fratin, stated “We are convinced that, given demand and with a view to decarbonisation, we cannot do without a share of nuclear power in our energy production in the future.”

This comes from a country that once relied on Moscow for 40% of its gas reserves, meaning the effects of the energy crisis were profoundly felt. For Italy to meet its decarbonisation goals and achieve energy security, it would seem that nuclear presents an ideal solution.

Meanwhile, U.S. President Joe Biden has this month announced he intends to provide up to $900 million to fund the buildout of small modular reactor (SMR) technology. The Biden administration has backed nuclear power throughout its tenure, believing it to be essential for decarbonisation.

In the private sector, Bill Gates recently announced his readiness to commit billions of dollars into a next-generation nuclear power plant project in Wyoming.

Given that a recent report from the Information Technology & Innovation Foundation suggested that the U.S. is as many as 15 years behind China on developing high-tech nuclear power, it would seem that there is a desire to catch up.

And across the Atlantic, six designs for SMRs (including one from Rolls-Royce) are currently competing for up to £20 billion in funding. Upon completion, it could power six million homes with clean electricity, and reduce the UK’s reliance on increasingly expensive fossil fuel imports.

There are plenty more examples. The bottom line is that we are seeing something of a “nuclear renaissance”, a widespread acceptance and commitment to nuclear energy. If, as suggested earlier in this article, this shift is being primarily driven by the dual need for clean energy and energy security, we might expect the adoption of nuclear to ramp up further. Net-zero targets are not going away, and geopolitical tensions are not subsiding.

The consequence of this nuclear renaissance is a marked increase in demand for uranium. In the last couple of decades, nuclear power had largely been reliant on stockpiles of uranium left over from the Cold War – but those stockpiles have since depleted.

Uranium demand is now expected to outstrip supply, culminating in a 1-billion-pound deficit by 2040, according to forecasts.

Uranium Mining

Source: UxC LLC. and Cameo Corp. Data as of Q4 2023. Chart displays expected data. For illustrative purposes only.

In order to meet the new demand levels, we will need to mine much more uranium. Whether it entails expanding preexisting mining operations, or investing in the exploration of new mining sites, supply will need to increase.

Uranium miners may be poised to take a greater market share as the nuclear revolution unfolds in earnest, following years of relative underrepresentation.

The extent to which nuclear may or may not dominate the future of energy remains to be seen, but if the current trend continues, it seems that nuclear power, and the uranium miners underpinning it, could be central to a new nuclear age in the coming years.

Sprott Uranium Miners UCITS ETF (URNM) seeks to invest in companies devoted to the uranium mining industry, which may include mining, exploration, development and production of uranium.

The Fund is also permitted to invest in entities that hold physical uranium, uranium royalties or other non-mining assets. We believe these companies may stand to benefit from nuclear power’s increasing contribution to the green energy transition.

Sprott Junior Uranium Miners UCITS ETF (URNJ) seeks to invest in small, exploration- and development-stage uranium mining companies with the potential for revenue and asset growth.


Thematic ETFs are exposed to a limited number of sectors and thus the investment will be concentrated and may experience high volatility. Investors’ capital is fully at risk and may not get back the amount originally invested. Exchange rates can have a positive or negative effect on returns. The value of equities and equity-related securities can be affected by daily stock and currency market movements.

More Articles

AI adds to positive natural gas outlook

Juni 2024

Copper – the defining metal of a new age

Juni 2024

Trump stance will force NATO countries to spend more whether elected or not

Mai 2024

The great travel industry rebound

Mai 2024

ESG Mining – Turning a brown industry greener

Mai 2024

ESG and defence investing: a balancing act

Mai 2024

Dominant Magnificent 7 could lose ground to broader tech rally

Mai 2024

The fall of Russian defence spending, and the rise of NATO

April 2024

Die KI-Revolution – ein Spiel mit Rohstoffen?

April 2024

Recycled gold and traceability

April 2024

Warum Investoren den Verteidigungssektor in Betracht ziehen sollten

April 2024

Copper’s new supercycle | Fresh highs and the long-term story

April 2024

Bitcoin in 2024 – a monumental year so far

März 2024

Gold price rallies but miners need to catch up

März 2024

Investing in India’s rise – what makes India an ideal emerging market?

Februar 2024

Global instability – three potential ways to hedge

Februar 2024

Energy Transition: The Metal Elephant in the Room

Januar 2024

HANetf’s 2024 Outlook

Dezember 2023

The Road Ahead for Digital Infrastructure

August 2023

HANetf Model Portfolios Performance Review – Q2

August 2023

Two Ways to Invest in Low-carbon Gold

März 2023

US ETFs are not the only ETF wrapper with a tax advantage; Irish domiciled ETFs have one too!

März 2023

Article | There is no Walt Disney Company in crypto yet…

Januar 2023

Gold Shining in 2023?

Januar 2023

HANetf 2022 wrap up and outlook for 2023: Where did the inflows go?

Januar 2023

Key Dates for Digital Assets in 2022

Januar 2023

Article | The Merge and Ethereum – what you need to know

September 2022

Article | The innovative US funds that HANetf has brought to Europe

Juli 2022

Article | Why small ETFs are not necessarily less liquid

Februar 2022

Article | HANetf Outlook 2022: Covid; gold; crypto and more

Januar 2022

Solar Energy 101 | Understanding the Solar Energy UCITS ETF

Juni 2021

The Investment Case for Solar Energy | Executive Summary

Juni 2021

The Royal Mint ESG Credentials

Mai 2021

Five Things to Know about Investing in a Gold ETC

August 2020

Don’t Look | The Case For Non-Transparent Active ETFs

Juni 2020

Wie man kauft