Is a nuclear energy investment boom coming? , breaking news in the U.S. energy sector

On May 29, local time, the White House released a series of policies to promote the construction of the nuclear industry, including promoting the deployment of new nuclear power plants and promoting the development of supply chains such as enriched uranium. The White House also announced that the U.S. Department of Energy's Advanced Nuclear Reactor Demonstration Program is providing "substantial funding" for a range of projects.

At the same time, US President Biden signed a congressional appropriation plan to provide US$800 million to fund up to two third-generation SMR demonstration projects. There are various signs that the United States may set off a wave of nuclear energy investment.

From a global perspective, nuclear power will also usher in a wave of restart. CITIC Securities pointed out that after a century of development, global nuclear power has ushered in a large-scale restart. Nuclear power plans in various countries correspond to an installed capacity of more than 1,200GW in 2050, driving a potential replacement demand for more than 1,000GW of new stock. Huatai Securities also believes that this round of global nuclear power construction wave is expected to match the previous peak in terms of length and intensity, and that the nuclear energy industry is experiencing a "once-in-a-decade" industrial opportunity.

On May 29, local time, the White House released a series of policies to promote the construction of the nuclear industry and deployed a special working group to study and solve problems such as the slow progress of nuclear power plant construction and the surge in costs.

The announcement issued by the White House outlines the Biden administration's multiple nuclear power support policies, which can be roughly divided into four aspects: providing funds to support the extension of existing nuclear power plants, promoting the deployment of new nuclear power plants, simplifying the approval and construction of new nuclear power plants, and expanding the capacity of existing nuclear power plants. licensing processes, and advancing supply chains such as enriched uranium.

The White House announced that the U.S. Department of Energy's Advanced Nuclear Reactor Demonstration Program is providing "substantial funding" for a range of projects. Companies receiving government subsidies include a range of fourth-generation nuclear reactor developers and suppliers, such as TerraPower and veteran nuclear power technology company Westinghouse Electric.

On the same day, the Biden administration held a Domestic Nuclear Energy Deployment Summit at the White House, at which it announced the establishment of a new group that will seek to find ways to reduce nuclear power plant construction costs and schedule overruns.

Nuclear energy is becoming one of the most important energy sources in the United States. The White House stated that nuclear energy is the largest source of clean energy in the United States. In 2023, 19% of U.S. power generation will come from nuclear energy, while wind energy and solar energy will account for 10% and 4% respectively.

At the same time, US President Biden signed a congressional appropriation plan to provide US$800 million to fund up to two third-generation SMR demonstration projects. Implementation of the scheme will be announced later this year. The plan also allocates $100 million for the design, licensing, supplier development and site preparation of third-generation SMRs.

The Export-Import Bank of the United States and the U.S. Department of State announced the launch of the “EXIMSMR Financing Toolkit,” a set of financial tools designed to support SMR deployment and help U.S. exporters compete in the global SMR market.

The U.S. Nuclear Regulatory Commission will also continue to reform its licensing and approval processes to simplify the licensing process for building new reactors, extending the life of existing reactors, and expanding the capacity of existing reactors, as well as simplifying the environmental review of new reactor licenses and existing reactor operating licenses.

There are various signs that the United States is about to set off a wave of nuclear energy investment.

In March this year, the Biden administration announced that the U.S. federal government would provide a $1.5 billion loan to restart the Palisades Nuclear Power Plant in southwestern Michigan. This was the first time in U.S. history that a closed nuclear power plant had been restarted.

Currently, the biggest uncertainty facing Biden’s nuclear energy plan is the supply of enriched uranium.

Russia is the world's largest supplier of enriched uranium. About 24% of the enriched uranium used in U.S. nuclear power plants comes from Russia. According to the U.S. Department of Energy, Russia provides low-enriched uranium to more than 90 commercial nuclear reactors in the United States and is the top external supplier of low-enriched uranium to the United States.

Data compiled by the Russian Satellite News Agency show that in November 2023, Russia became the largest uranium exporter to the United States for the first time. Russia sold a total of uranium fuel to the United States worth US$1.017 billion, which is the highest value since 2010.

On May 13, local time, Biden signed the "Russian Uranium Import Ban Act", which prohibits the import of enriched uranium from Russia unless the importer obtains an exemption from the U.S. Department of Energy. The bill also provides approximately $2.7 billion in funding to launch new U.S. enrichment capabilities for low-enriched uranium and highly enriched uranium.

Once the bill is formally implemented, the supply chain of U.S. nuclear reactors will face huge uncertainty.

The White House stated in the latest announcement that under the leadership of President Biden, the current administration has taken a series of actions to reduce and gradually eliminate dependence on Russian uranium and establish a new nuclear fuel supply chain to strengthen U.S. energy and economic security.

The announcement showed that Centrus Energy Corporation produced the first 100 kilograms of high-purity low-enriched uranium in the United States. This is the first time the United States has produced this type of uranium in more than 70 years and completes a major milestone for the U.S. Department of Energy’s HALEU demonstration project in Piketon, Ohio. It is expected that Centrus' HALEU material production will increase to 900 kilograms per year starting in 2024.

As a clean, zero-carbon emission energy source, nuclear energy is being re-recognized by global energy planners for its clean, stable and safe features.

Currently, global nuclear power is ushering in a wave of restarts. CITIC Securities pointed out that after a century of development, global nuclear power is ushering in a large-scale restart. Nuclear power plans in various countries correspond to an installed capacity of more than 1,200GW in 2050, driving more than 1,000GW of potential new stock replacement needs. Since my country's nuclear power restarted in 2019, the pace of project approval has accelerated significantly. It is expected to become the world's largest nuclear power country in this round of nuclear power restart cycle. The construction cycle of nuclear power projects is long. The large number of accumulated orders in the early stage and the implementation of new projects will promote the long-term cycle. The parts and components sector will see a three-year boom from 2024 to 2026.

Huatai Securities predicts that this global wave of nuclear power construction is expected to be comparable in length and intensity to the peak of the previous wave in the 1970s and 1980s. Between 2024 and 2035, the average annual installed capacity of global nuclear power is expected to exceed 18GW/year. The nuclear energy industry is experiencing " Industrial opportunities that only come once in ten years.

Uranium is the main fuel for the operation of nuclear power plants. Due to the substantial increase in the demand for nuclear energy, uranium spot prices will accelerate after 2021, and will start a "surge mode" in 2023.

In March this year, the international uranium price once exceeded US$100/lb, approaching a 16-year high. The latest data from the Global Economic Indicators Network shows that on May 30, the international uranium price was still above US$90/lb. Compared with the beginning of 2023, the cumulative The increase reached 84%.

Regarding the outlook for uranium prices, Huatai Securities said it is optimistic that spot uranium prices will continue to have upward momentum amid one or two warming supply and demand relations. The uranium price ceiling is also likely to be further opened with the recent structural price increase of overseas nuclear power brought about by AI data centers. In this process, the uranium price of the Changjie Association is expected to move upward towards the spot uranium price, which will benefit uranium mining companies in terms of profit volume and price. Lift.

Shocking "Oolong Finger"! The investment bank plummeted by 2.36 trillion yuan in 5 minutes and was heavily fined!

Illegal and harmful information reporting hotline: 0755-83514034

Email: bwb@stcn.com