00:00 To combat climate change we need to stop relying on fossil fuels.
00:03 Renewable energy sources are great but they suffer from intermittency issues.
00:07 Solar power needs the sun to shine and wind turbines need the wind to blow.
00:11 Batteries aren't yet good enough to store all the energy they create.
00:14 A clear solution to this is nuclear power. Nuclear has low operating costs and it's 8,000
00:19 times more efficient than fossil fuels. It's also clean. According to the World
00:24 Nuclear Association, during its life cycle nuclear energy produces about the same amount
00:28 of CO2 per unit of electricity as wind and even less than solar. Of course nuclear power has
00:34 problems too. Reactors cost a lot to build, nuclear waste is radioactive and accidents happen.
00:39 The progress of nuclear power hit a major setback after the 2011 disaster at Fukushima.
00:45 That said, the scale of the challenge facing humanity is so great that we're going to need
00:49 some help from nuclear power in order to meet carbon targets. And this progress is starting
00:54 to happen. Right now there are at least 57 nuclear reactors being built around the world.
00:59 According to the International Energy Association, 8 gigawatts of new nuclear
01:03 capacity came online last year. The thing is, to reach net zero we're going to need
01:08 four times more than that every single year until 2030 according to the Financial Times.
01:14 And the best way to invest in the future of this nuclear power is through the fuel uranium.
01:19 Uranium itself is an abundant metal. According to BMO, global stockpiles are 3.8 times higher
01:25 than annual demand. But not many people are mining uranium right now. Demand is outstripping
01:30 supply by 50 million pounds per year according to the Financial Times and this is quickly
01:35 depleting stockpiles. As a result, the price of uranium is starting to rise, hitting $56 a pound.
01:42 Today there's plenty of ways to invest in this trend. Uranium mining stocks like Camco, Energy
01:47 Fuels, Denison Mines and Uranium Energy Corp offer investors direct and mostly unhedged exposure
01:53 to the price of uranium. Meanwhile, larger cap mining companies like BHP Billiton and Rio Tinto
01:59 also have uranium mines as well as exposure to other commodities like copper which is used a
02:04 lot in electric vehicles. Buying small individual miners is highly risky since they often go
02:09 bankrupt. They usually operate in high risk countries and the process of mining is difficult
02:14 and expensive. But when they do succeed, they can produce big returns. A less risky way to invest
02:19 in uranium is through ETFs. The Global Uranium ETF URA provides exposure to a range of companies
02:25 involved in uranium mining and the production of nuclear components and it's got an expense ratio
02:31 of 0.68%. There's also the Sprott Uranium Miners ETF and the Sprott Physical Uranium Trust which
02:37 invests in physical uranium and currently holds over 61 million pounds of the metal. This one has
02:43 an expense ratio of 0.7%. If the price of uranium continues to increase, these stocks and ETFs should
02:50 all rise in value. But this is my personal opinion, not financial advice and I do hold shares in UEC,
02:55 URA and Energy Fuels. If you're interested in more detailed investing ideas, make sure to visit
03:01 our website overlookedalpha.com
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