Episode summary
Nuclear Stocks: Why I Haven’t Recommended a Single One
Summary
The host argues that the Nuclear Regulatory Commission’s first-ever approval of a small modular reactor for the Tennessee Valley Authority is a major milestone, but not an investing signal. He says the approval at the Clinch River site in Oak Ridge, Tennessee means the design is deemed safe and construction can begin, though TVA still needs an operating license before it generates power.
He frames SMRs as part of the broader AI and energy race, but says the key issue is cost. The host cites an expected $18,000 per kilowatt for the nuclear project versus about $6,000 for geothermal and $2,500 for natural gas, and notes gas has risen sharply from $785 in 2022. In his view, capital tends to flow to the lowest-cost, fastest path to deployment.
That is why he says he has not recommended any nuclear stocks. Instead, he says his portfolios have leaned toward gas and geothermal, which he believes will win business from data centers and other power-hungry projects because they are easier to finance and build.
Key takeaways
- The host says the NRC’s approval of TVA’s SMR is historic, but TVA still needs an operating license before producing power.
- He argues nuclear is too expensive at about $18,000 per kilowatt versus $6,000 for geothermal and $2,500 for natural gas.
- The host says the AI buildout is really an energy race, but investors will back the cheapest and fastest power source.
- He says he has not recommended any nuclear plays, preferring gas and geothermal instead.
- The host expects geothermal to have an especially strong opening in the West because gas equipment is backlogged.
Notable quotes
“The Nuclear Regulatory Commission, the NRC, just approved its first-ever small modular reactor, its first-ever SMR”
“this approval is huge. I mean, it means that the commission determined that the reactor's design is safe”
“the AI race is at root an energy race. All technology revolutions are at root powered by energy”
“Here for this plan, they're expecting $18,000 per kilowatt cost to get this thing up and running”
“I haven't recommended any nuclear plays. I mean, we've recommended things that benefit from nuclear, picks and shovel plays”
How the episode opens
Good morning. This is Dylan Jovine with Behind the Markets. Happy Wednesday.
Today is Wednesday, October 14th. Well, today I'd like to talk about a story that I haven't covered yet. I was traveling when it happened, but it's kind of a big story.
The Nuclear Regulatory Commission, the NRC, just approved its first-ever small modular reactor, its first-ever SMR. You've been hearing a lot of promotion about this as people who back nuclear small module reactors have been promoting the heck out of this as the solution to all the energy problems we have. And you know, they did it for the NRC approved it for the Tennessee Valley Authority.
Remember the TVA you learned during your study of the Great Depression that Roosevelt created the Tennessee Valley Authority or helped it. Anyway, the TVA at its Clinch River site in Oak Ridge, Tennessee, very important site for people who remember the study of the atomic bomb and the creation of that. So, anyway, they're building their SMR there, right there in Oak Ridge, Tennessee, and this approval is huge.
I mean, it means that the commission determined that the reactor's design is safe and that the operator, the Tennessee Valley Authority, which is a utility, can actually start building. Although, there's one more hurdle left for the TVA. The TVA would need an operating license to start generating power.
So many hurdles, right? I mean, it's just insane. But I understand that.
You need to, you know, the regulators need to approve the design, and then they to get the license, you got to show that everything's working as designed, and that makes sense given that we're talking about nuclear. So, this is kind of a very, very big deal. It's the very, very first time that the NRC has given approval to build an SMR, a small modular reactor.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- nuclear power costs
- small modular reactors
- energy investment flows
- ai and energy demand
- geothermal vs natural gas
Companies and tickers mentioned
- Tennessee Valley Authority
Watch the episode
Watch “Nuclear Stocks: Why I Haven’t Recommended a Single One” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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