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How to Beat Putin, Climate Change, and the Market by Investing in Nuclear Energy

New nuclear investments could help beat Putin abroad, climate change globally, and the markets at home. Here’s how we start.

If the top risks to the world right now are geo-political rivalry and conflict, energy security, and climate change, investing in nuclear energy is essential.

Less dependence on Russian energy supplies will strengthen the NATO alliance, and increased nuclear energy in the world’s electricity mix weakens the hand of China’s de facto ally Russia.

For example, the Ukraine situation would be much easier to handle if Germany had not made the decision to close all of its nuclear reactors by the end of 2022. Russia is by far the largest natural gas supplier to Europe, providing roughly 40% of the region’s imports, primarily through pipelines.


Furthermore, increased investing in nuclear energy would, over time, free up financial resources for European members of the alliance to provide for 70% of NATO’s minimum military requirements by 2030 so that America can focus 60% of its military resources on its top priority: protecting freedom of navigation in Asia and deterring China.

Germany’s decision to shut down its nuclear energy program exposed Europe’s vulnerability and surely emboldened Russian President Vladimir Putin to invade Ukraine in his bid to rewrite the post-Cold War security arrangements for Europe.

Why the World Should Consider Investing in Nuclear Energy

Politicians in America and Europe need to show some courage by investing in nuclear energy technology that is far safer, cleaner, and less costly than earlier generations of technology.

The advantages of nuclear energy over the alternatives are clear. Nuclear energy is virtually emissions-free energy, takes up very little land, consumes very little fuel, contributes to fuel diversification and the stability of the grid, creates skilled, well-paid jobs, and produces very little waste. It‘s the technology that solves both energy poverty and climate change.

Then there is the important issue of reliability. Nuclear power plants on average operate at full power on 336 out of 365 days per year. Hydroelectric systems deliver power on average 138 days per year, wind turbines 127 days per year and solar electricity only 92 days per year. Even plants powered with coal or natural gas only generate electricity about half the time for various reasons. Nuclear power is also a clear leader on reliability. No wonder nuclear power accounts for 70% of France’s electricity mix and 30% for Switzerland, South Korea and Sweden.

In the public’s perception, there are two issues with nuclear power: the risk of accidents, and the question of disposal of nuclear waste. There have been three large-scale accidents involving nuclear power reactors since the onset of commercial nuclear power in the mid-1950s: Three-Mile Island in Pennsylvania, Chernobyl in Ukraine, and Fukushima in Japan. These incidents all represent old technology.

Nuclear waste disposal, although a continuing political problem in the U.S., is not any longer a technological problem. More than 90% of spent fuel could be recycled to extend nuclear power production by hundreds of years, and can be stored safely in impenetrable concrete-and-steel dry casks on the grounds of operating reactors, its radiation slowly declining. Price and performance are the key factors, and advanced nuclear energy is cheaper than coal and more dependable than solar or wind.

2 Companies for Investing in Nuclear Energy in Your Portfolio

There are significant American beachheads to support and validate the new nuclear investments. For example, Duke Energy (DUK), 40% of the electricity the company produces comes from nuclear power. America has 94 reactors that generate about 20% of our electricity but we have not built one new plant in the last 25 years.

In both America and Europe, where productivity at construction sites has been low, we need expanded use of factory production to take advantage of the manufacturing sector’s higher productivity when it comes to turning out complex systems, structures, and components. This includes modular construction in factories and shipyards, high-strength reinforcement steel as well as ultra-high-performance concrete. All of these could have positive impacts on the cost and schedule of investing in nuclear energy.

Wyoming Governor Mark Gordon announced in June 2021 that a next-generation nuclear power plant would be built at a soon-to-be-retired coal-fired plant. The project is a joint initiative of PacificCorp and Bill Gates’s Terra Power. The project includes a 345-megawatt sodium-cooled fast reactor with a molten-salt-based energy storage system, which would produce enough power for roughly 250,000 homes. The storage technology is also able to boost output to 500 megawatts of power for about five and a half hours, which is equivalent to the energy needed to power around 400,000 homes, according to TerraPower.

Companies such as BWX Technologies (BWXT) and private firms such as Westinghouse, X-energy, and UltraSafe Nuclear are all working on new concepts, such as the advanced small modular reactor (SMR) design such as a sodium fast reactor, and a modular high-temperature, gas-cooled reactor. For example, NuScale is developing a small reactor that is capable of generating 77 megawatts of electricity and is in the midst of the U.S. Nuclear Regulatory Commission’s licensing process.

Both America and China can create carbon-free electricity by ramping up modern safe, nuclear energy. If you are concerned about climate change, you should consider investing in nuclear energy.

Would you consider investing in nuclear energy in your own portfolio?


Carl Delfeld is a member of the Cabot investment team, and chief analyst of Cabot Explorer.