Best of the Week
Most Popular
1.Gold Price Trend Forecast, Where are the Gold Traders? - Bob_Loukas
2.Stocks Bear Market of 2017 Begins? Shorting the Dow At its Peak! - Nadeem_Walayat
3.Betting on President Trump Leaving Office Early, Presidency End Date - Betfair Market - Nadeem_Walayat
4.Why Stock Market Analysts Will be Wrong About 2017 - Clif_Droke
5.Is This The Best Way For Investors To Play The Electric Car Boom - OilPrice_Com
6.Silver Price 2017 Trend Forecast Update - Video - Nadeem_Walayat
7.Gold Price Set For Very Bullish 2017, Trend Forecast - Austin_Galt
8.10 Things I learned From Meetings With Trump’s Transition Team - - John_Mauldin
9.How Investors Can Profit From Trumps Military Ambitions - OilPrice_Com
10.Channel 4 War on 'Fake News', Forgets Own Alt Reality Propaganda Broadcasting - Nadeem_Walayat
Last 7 days
Trump Relinquishes Control of Foreign Policy - 26th Feb 17
[Gratis] "Dark Money" Secrets Revealed! - 26th Feb 17
Stock Market SPX New All-time Highs Continue - 25th Feb 17
POWERFUL GOLD & SILVER COILED SPRINGS: Important Charts You Have To See - 25th Feb 17
Underperformance in Gold Stocks Argues for Interim Peak - 25th Feb 17
Watch What Happens When Silver Price Hits $26...  - 25th Feb 17
Gold Futures Buying Yet to Start - 25th Feb 17
When the Stock Market Flying Pig Tops - 24th Feb 17
Gold, Second Fed Hike and Interest Rates - 24th Feb 17
Bitcoin Price Hits Record High! - 24th Feb 17
Another Stock Market Bubble? Bring it On! - 24th Feb 17
What Investors Need To Know About U.S. Money Market Funds? - 24th Feb 17
When Was America’s Peak Wealth? - 24th Feb 17
The Oscars – Worth Their Weight in Gold? - 24th Feb 17
The Best Reasons to Buy Gold in the Age of Trump - 22nd Feb 17
Silver, The Return of Stagflation - 22nd Feb 17
Why EU BrExit Single Market Access Hard line is European Union Committing Suicide - 22nd Feb 17
Gold: Short End US Rates Matter More Than Long End Real Yields - 22nd Feb 17
CONTINENTAL RESOURCES: Example Of What Is Horribly Wrong With The U.S. Shale Oil Industry - 22nd Feb 17
Here’s Proof Rising Rates Are Good for Gold - 21st Feb 17
Gold and Silver Weekly Update - 21st Feb 17
US Dollar and Gold Battle of the Cycles - 21st Feb 17
NSA and CIA is the Enemy of the People - 21st Feb 17
Big Moves in the World Stock Markets - Big Bases - 21st Feb 17
Stock Market Uptrend Continues - 21st Feb 17
Brent Crude Oil Price Technical Update: Low Volatility Leads to High Volatility - 20th Feb 17
Trump’s Tax System Could Spark The Wave Of Self-Employment - 20th Feb 17
Here’s How to Stay Ahead of Machines and AI - 20th Feb 17
Warning Signs Of Instability In Russia - 20th Feb 17
Warning: This Energy Investment Could Wreak Havoc On Your Portfolio - 20th Feb 17
The Mother of All Financial Bubbles will be Unimaginably Destructive when it Bursts - 19th Feb 17
Gold’s Fundamentals Strengthen - 18th Feb 17
The Flynn Fiascom, the Trump Revolution Ends in a Whimper - 18th Feb 17
Not Nearly Enough Economic Growth To Keep Growing - 18th Feb 17
SPX Stocks Bull Market Continues to make New Highs - 18th Feb 17
China Disaster to Trigger Gold Run, Trump to Appoint 5 of 7 Fed Governors - 18th Feb 17

Market Oracle FREE Newsletter

State of Global Markets 2017 - Report

The Big Nuclear Energy Lie

Commodities / Nuclear Power Dec 12, 2012 - 12:15 PM GMT

By: DailyWealth

Commodities

Matt Badiali writes: What are the Japanese doing in Uzbekistan?

For natural resource investors, it's one of the most important questions in the world. The country is a major gold producer. It also produces large amounts of natural gas, cotton, and copper. But these days, Japan has little interest in the traditional commodities Uzbekistan has to offer.


The Japanese are in Uzbekistan because they need uranium...

That might surprise a few readers. Japan's Fukushima Daiichi nuclear disaster pushed the country to shut down its 50 nuclear reactors within weeks. The mainstream media reported Japan planned to swear off nuclear energy for good.

Several other countries followed suit, most notably Germany. Chancellor Angela Merkel shut down all of Germany's nuclear power plants, instantly removing 41% of Germany's electric power.

But that's not the end of the story. And if you dig through the hysteria and government misinformation and look at the facts, you'll find a big investment opportunity...

You see, once again, basic economics is overriding political speechmaking. Let me explain...

Coal is the world's most important fuel for power generation... accounting for 40% of the electricity generated in 2010 (the most recent full-year data available)... Natural gas comes in next at 21% (and rising). Hydropower generates 16%, barely ahead of nuclear at 13%.

Global demand for electric power totaled 22,018 terawatt hours (TwH) in 2010, according to the International Energy Agency (IEA) World Energy Outlook 2012. Depending on policy changes, economic development rates, and population growth over the next 25 years, the study predicts an increase in electrical consumption between 48% and 88%.

Government policies will drive development of the various fuels. But in any scenario you choose, nuclear power plays a prominent role.

In 2010, nuclear power produced 2,756 TwH of electricity. Depending on the scenario used, the IEA projects nuclear power growth between 42% and 117% over the next 25 years. That would put production between about 4,000 TwH and 6,000 TwH.

That is a significant underestimation.

This study accepts at face value governments' fanciful projection of renewable energy, which would reduce the role of nuclear power. In the most aggressive scenario, the study shows non-hydro renewable power accounting for 9,031 TwH in 2025. That's much more than nuclear and nearly 12 times the power production by renewables in 2010. That is a ridiculous assumption. And I believe, in real life, that nuclear power will be tapped to fill much more of that production than in this estimate.

Here's why...

The following table displays the costs of various sources of electric power in U.S. cents per kilowatt hour (KwH). Nuclear power is the cheapest source of electricity.

Further complicating Japan and Germany's anti-nuclear stance... both countries are aggressively trying to restrict the use of fossil fuels, like coal, to reduce carbon-dioxide production. (We'll leave the folly of that endeavor for another day.)

If you abandon nuclear fuel and coal... you're left with limited and expensive options...

"Renewable" energy sources are popular to discuss, but the only viable one is hydroelectric power. And as the table shows, it's more than four times as expensive to operate as a nuclear power plant. Wind and solar are unproven as mainstay sources of power for a national power grid... and are incredibly expensive to build and maintain.

Add to that... the demand for electricity is growing fastest in places that don't have the luxury of experimenting with fads and theories...

The IEA and oil major BP both put out highly regarded annual energy forecasts. And according to both analyses, electricity demand represents the largest growth of any energy sector. World electricity demand is projected to grow between 2.2% and 2.6% per year through 2030, according to the two major forecasts. And as you would expect, the main sources of growth are the immense and modernizing economies of China (38%) and India (13%).

One of the cheapest, cleanest options for these countries is nuclear power. There's just no way the world can work without nuclear energy playing a prominent role... no matter what the politicians say.

That's why Japan is in Uzbekistan looking for uranium. Just a few months ago, Japan Oil, Gas, and Metals National Corporation – the government agency responsible for creating stable supplies of key resources – closed a deal to help fund the exploration and production of large uranium deposits in central Uzbekistan.

This is not the action of a country ready to give up on nuclear power. It's the action of a country that's saying one thing and doing another. And that's why there's a big opportunity here for investors.

In my next essay, I'll show you another major factor that will help kick off a bull market in uranium and uranium producers.

Until then...

Good investing,

Matt Badiali

P.S. Last week, I told my S&A Resource Report subscribers about my three favorite ways to profit off the opportunity in uranium. These companies are so beaten-down that we won't risk more than 12.5% on any of them... and our potential gains are as much as 300% if they simply recover to their pre-Fukushima prices. You can gain immediate access to these picks with a subscription to the S&A Resource Report. Learn more here.

http://www.dailywealth.com

The DailyWealth Investment Philosophy: In a nutshell, my investment philosophy is this: Buy things of extraordinary value at a time when nobody else wants them. Then sell when people are willing to pay any price. You see, at DailyWealth, we believe most investors take way too much risk. Our mission is to show you how to avoid risky investments, and how to avoid what the average investor is doing. I believe that you can make a lot of money – and do it safely – by simply doing the opposite of what is most popular.

Customer Service: 1-888-261-2693 – Copyright 2011 Stansberry & Associates Investment Research. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This e-letter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of Stansberry & Associates Investment Research, LLC. 1217 Saint Paul Street, Baltimore MD 21202

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Daily Wealth Archive

© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife