The European Commission recognizes the importance of nuclear energy in the green revolution
Earlier this month, the European Commission recommended that nuclear energy be considered green energy.
The EU uses an investment classification system called the EU taxonomy, in which it attempts to establish a common language and clear definitions around what is considered “sustainable”. Three types of investments are considered green: those that contribute substantially to emissions targets, such as wind or solar power; those that enable other green activities, such as electricity storage; and transition activities that are not considered fully sustainable but have emissions below the industry average.
Nuclear energy is considered vital to achieving net zero emissions by some experts, and is heavily factored into the energy infrastructure of France and the Czech Republic.
Uranium is emerging from a decade-long bear market where oversupply of uranium and widespread distrust of nuclear power following high-profile disasters had clouded public outlook on the nuclear energy. As the threat of climate change has become more pronounced, nuclear power is gaining attention as a possible green solution to help shift away from coal and other high-emitting energy sources.
Nuclear power currently provides 10% of the world’s electricity and produces fewer emissions per gigawatt hour than even wind and solar power. Additionally, solar and wind energy are still nascent in their development and have some quirks. Solar panels only work when they receive sunlight, and wind turbines depend on strong winds to meet demand. Electric storage can fill some gaps here, but nuclear power has the advantage of being almost always online and producing power.
In addition, the nuclear energy supply situation has changed dramatically. Low uranium prices over the past decade have discouraged the development of new mines and increased production capacity. However, the upsurge in demand means that the supply will be exploited, which will push prices up further and make now an excellent time for investors to get into uranium through funds such as the Sprott Physical Uranium Trust (UU). The Sprott Physical Uranium Trust offers investors a safe and convenient way to gain exposure to physical uranium at a time when the market is primed to take off.
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