Nuclear power is not an industry that experiences huge growth rates, and it is infinitely more difficult for investors to find a hidden gem in nuclear energy than it is in oil and gas. There just aren’t any mom and pop nuclear shops out there. Nevertheless, it is a global industry that does around $140 billion in annual business and thus it is important to get a status check on what is going on in the nuclear world from time to time.
A Renaissance Delayed
The “nuclear renaissance” was supposed to have kicked into high gear by now, as many predicted only a few short years ago. But the industry has hit a standstill in the western world, as a confluence of events conspired to kill off the renaissance before it got started.
First was the financial crisis, which depressed demand for electricity worldwide, and despite the economic recovery, power demand will not reach the trajectories that executives had previously anticipated. Then came the fracking revolution, which caused natural gas prices to plummet as a glut of new fuel came online. Utilities suddenly found it much cheaper to go with gas over nuclear power.
Meanwhile, the collapse of the cap-and-trade bill in 2009 in the U.S. Congress doomed carbon pricing for at least half a decade, perhaps longer. As a carbon-free fuel, the nuclear industry would have benefited enormously from restrictions or costs put on fossil fuels. Climate hawks are still trying to gain back the momentum they…