In the Spotlight Trend of the Month
As the world transitions away from fossil fuels, the need for scalable, low-emission baseload energy is intensifying. Nuclear power is uniquely positioned to address this need as it generates near-zero emissions and is a very reliable source of energy.
Today, countries all over the world are incorporating nuclear power into their long-term energy strategies, driving new investment and infrastructure buildout across the supply chain. Here’s a look at some recent developments, and how investors can gain exposure to the theme with eToro’s new NuclearFuture Smart Portfolio.
The benefits of nuclear energy
As an energy source, nuclear power has a lot going for it. For a start, it’s a very clean source of energy. Over the course of its life cycle, nuclear energy produces about the same amount of carbon dioxide-equivalent emissions per unit of electricity as wind power and around a third of the emissions per unit of electricity compared to solar power. Given this low-carbon profile, it can help in the global fight against climate change.
It’s also a very reliable energy source. Unlike wind and solar power, nuclear power does not require optimal weather conditions to generate electricity. Therefore, it can be a consistent and dependable source of baseload power that operates 24/7. It’s worth noting that in 2024, nuclear power plants in the US operated at full capacity approximately 92% of the time.
In addition, it’s extremely efficient. Nuclear energy is fuelled by uranium, and an egg-sized amount of uranium fuel can provide as much electricity as 88 tonnes of coal. Meanwhile, a typical 1,000-megawatt nuclear facility only requires a little more than one square mile to operate. To produce the same amount of energy with wind power, it would require 360 times more land area.
One other major attraction of nuclear power is that there is a lot of innovation going on in the industry today.
Small modular reactors (SMRs) are a good example here. These are a new generation of smaller nuclear reactors that are transportable and offer far more flexibility in terms of positioning. Given their broad range of use cases (they can be used to power data centres, mining operations, manufacturing plants, remote industrial sites, and more), the market for these reactors is expected to grow significantly in the years ahead.
Other innovations include microreactors (a type of SMR, but on a much smaller scale) and advanced fuels such as High-Assay Low-Enriched Uranium (HALEU).
Together, these are reshaping the economics and scalability of nuclear power and opening up new markets and opportunities.
A high level of government interest
Given the benefits of nuclear power, and the level of innovation across the industry today, many countries are currently re-evaluating its role as a long-term energy source. In May, US President Trump issued four executive orders (EOs) focused on nuclear energy in an effort to re-establish the country as a global leader in the industry. Goals of the EOs include quadrupling US nuclear generating capacity by 2050, reviewing and revising regulations and guidance documents to expedite licensing processes, boosting the domestic nuclear industrial base and fuel supply chain, and accelerating deployment of advanced nuclear technologies to enhance national security. More recently, in August, Sweden said that it would expand its nuclear output for the first time in 50 years. Other countries that have been making moves in the nuclear space recently include the UK, France, Poland, and the Czech Republic.
Private sector investments
It’s not just governments that are interested in using nuclear power, however; private companies are also embracing it. This is especially true in the Big Tech space, where the need for electricity is high due to the power demands of artificial intelligence (AI).
In September last year, Microsoft signed an agreement to assist in restarting the Three Mile Island nuclear reactor in Pennsylvania. Then, in October, Amazon revealed three new partnerships focused on the development of SMRs. Also in October, Alphabet announced an agreement to purchase nuclear energy from multiple SMRs being developed by Kairos Power, with the first unit targeted for operation by 2030. As for Meta Platforms, it made its first official foray into nuclear power in June this year, signing a 20-year agreement to buy energy from Constellation Energy’s Clinton Clean Energy Center in Illinois.
Outside Big Tech, organisations from a range of different industries are looking at the technology. For instance, Denver International Airport recently said that it is considering using nuclear power to fuel its operations and future growth.
Another organisation looking to capitalise on the benefits of nuclear energy is steel manufacturer Nucor Corporation. It has partnered with NuScale Power, a developer of SMR technology, to explore the use of SMRs to power its steel mills.
Given this combination of public and private sector interest, the long-term backdrop for the nuclear energy industry looks very promising.
In a report released in January, the International Energy Agency (IEA) stated that
“the market, technology, and policy foundations are in place for a new era of growth in nuclear energy over the coming decades.”
eToro’s NuclearFuture Smart Portfolio
To help investors gain exposure to the nuclear energy theme, eToro has developed the NuclearFuture Smart Portfolio. This is designed to provide exposure to companies involved in uranium mining, fuel processing and enrichment, nuclear reactor design and technology, engineering and infrastructure, and energy distribution (utilities).
With this strategy, portfolio construction begins with a broad universe of publicly traded companies operating across the nuclear supply chain. We then apply AI-assisted screening to assess each company’s financial strength, strategic relevance, and innovation profile.
From the screened list, we select 25 companies across the five different areas of the ecosystem with weightings assigned on conviction and strategy position. The portfolio is actively monitored and may be updated at eToro's discretion based on major developments in policy, technology, or market structure. You can find out more about the Smart Portfolio here.
