Cathie Wood's Ark Invest Says Nuclear Energy Could Overtake Solar As Cheapest Power Source: Here's A List Of Nuclear Energy Linked ETFs To Consider
After grappling with regulatory hurdles, rising capital costs, and rapidly declining costs of renewables like solar, Cathie Wood‘s Ark Invest highlights in its new research that nuclear energy can potentially emerge as the lowest-cost source of electricity, outcompeting solar.
What Happened: A new research note from Sam Korus, the director of research for autonomous technology and robotics at Ark, published on May 14, highlights that nuclear power’s promise of reliable baseload energy was overshadowed by soaring expenses, particularly after the 1970s.
While solar costs have plummeted, Ark Invest’s analysis highlights a crucial, often overlooked factor: utilization rates.
“A quick glance suggests nuclear wouldn’t be as low as solar on a cost-per-watt basis,” the research note explains, “but importantly, the first glance misses a key point: nuclear plants operate at more than 80% utilization, while solar plants operate at a capacity utilization rate in the low 20s%.”
When adjusted for this, the playing field dramatically shifts, explains Korus in his research.
The research proposes four potential cost scenarios for nuclear, with the most optimistic envisioning a “step-change cost decline to pre-1975 nuclear cost trendline.”
This discontinuous drop, driven by new companies like Oklo Inc. (NYSE:OKLO), could lead to overall capital costs of approximately $3.3 trillion, making nuclear power the lowest-cost option.
Korus adds, “The future of nuclear energy depends upon costs. If a company were to achieve a discontinuous decline in costs, nuclear power could emerge as the lowest-cost source of electricity.”
Here’s a list of some solar energy-linked stocks and exchange-traded funds that investors could consider.
Nuclear Energy Linked Stocks
YTD Performance
One-Year Performance
Oklo Inc. (NYSE:OKLO)
71.95%
404.97%
Nuscale Power Corp.(NYSE:SMR)
32.58%
217.30%
Lightbridge Corp. (NASDAQ:LTBR)
96.27%
220.83%
Centrus Energy Corp. (NYSE:LEU)
28.41%
96.79%
BWX Technologies Inc. (NYSE:BWXT)
-1.14%
24.59%
Constellation Energy Corp. (NASDAQ:CEG)
20.53%
31.36%
Talen Energy Corp. (NASDAQ:TLN)
13.65%
123.86%
Entergy Corp. (NYSE:ETR)
11.84%
47.66%
Nuclear Energy Stocks Linked ETFs
YTD Performance
One-Year Performance
VanEck Uranium and Nuclear ETF (NYSE:NLR)
4.30%
-0.74%
Sprott Uranium Miners ETF (NYSE:URNM)
-14.84%
-37.40%
Range Nuclear Renaissance Index ETF (NYSE:NUKZ)
11.74%
39.05%
Themes Uranium & Nuclear ETF (BATS:URAN)
2.79%
11.11%
Defiance Daily Target 2X Long Uranium ETF (NYSE:URAX)
-37.13%
-60.30%
Why It Matters: Talking about solar energy, Korus said that while solar costs are expected to continue their decline, there are significant logistical challenges.
“Solar's land requirement at 71.4 million acres would be a considerable logistical challenge,” the note states.
This vast footprint, coupled with complex real estate negotiations and long interconnect times, could make large-scale solar deployment difficult, leaving a vital role for alternative sources like nuclear.
Price Action: The SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 index and Nasdaq 100 index, respectively, fell in premarket on Wednesday. The SPY was down 0.44% to $590.22, while the QQQ declined 0.47% to $517.85, according to Benzinga Pro data.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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