Taking the Investment Pulse: Q4 2023

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ESG & Climate Finance, Climate Finance, Markets & Finance

Kayley Deaton

January 18, 2024

If one had to pick a word to describe 2023 for nuclear energy, it would be momentum. Amid inflation woes and geopolitical tensions, navigating clean energy investments can be difficult. That’s evidenced by the fact that climate tech investments were down 30% in 2023.

As if that weren’t a difficult enough environment, clean energy generators faced additional hurdles: owners of first- and second-gen solar farms met a midlife crisis, Ørsted canceled two offshore wind projects thanks to supply chain constraints, and weather events in the U.S. led to lower water supply and reduced hydropower generation.

Nuclear had its own hiccups this year—though, like the rest of the clean energy sector, it certainly doesn’t indicate a broader industry malaise. There are more projects, more announcements, more investments happening every day that paint a richer picture. Let’s break it down.

Trends

Economic Impact: In Q3’s update, we talked about the often-unsung positive impact that nuclear can provide economies—well, this quarter produced some projections to back it up. In Poland, a single BWRX-300 reactor could bring €5 billion to its economy, and OPG claims “a fleet of four SMRs will contribute approximately $15.3 billion to Canada’s GDP.”

Retail Investors: Everyday people from activists to influencers are throwing their weight behind nuclear energy. And you can see this surge in demand for reliable, clean nuclear reflected in investment portfolios. Uranium prices saw an unprecedented gain of 90% in 2023, with nuclear ETFs popping up and popping off.

@NEI’s International Uranium Fuel Seminar was incredible. Much to digest. I’ll be doing a UMM later this week with some key takeaways.

This panel was excellent. To summarize: nuclear demand is stable and growing, supply growth is uncertain, and China isn’t slowing down. pic.twitter.com/Uzr6AUcytK
— Uranium Insider (@uraniuminsider) October 24, 2023

Growing Pains: FOAK projects are always tricky, and nuclear is no exception. Though NuScale and UAMPS terminated their SMR project in Idaho, there were lessons learned that will pave the way for other companies, NuScale’s other projects, and for the Idaho project itself. UAMPS CEO and general manager insisted that the project won’t be “permanently discarded to a back room to gather dust. It just needs time to become fiscally feasible.” Similarly, the decision from X-energy and Ares to cancel their SPAC plans was in response to current market conditions, and X-energy ended the year strong by finishing a capital raise.

Announcements

U.S. Developments: From milestones and awards to customer deals and legislative wins, nuclear’s star really shone at home this quarter.

The potential of nuclear energy to address both decarbonization and the growing demand for electricity is clearer than ever before.

Chair Lewis, EX-IM Bank of the U.S.

International Developments: Rising interest in nuclear has created a wide and competitive global market for new reactors, large and small.

the video was… pic.twitter.com/POWjF9hpXY
— 💎 ISODOPE (@isodope) December 22, 2023

Commentary

It was a great quarter for reports, op-eds, and sound bites supporting the nuclear thesis. We heard from energy-intensive corporate customers like Microsoft, Wall Street players like Bank of America, and even billionaire CEOs like Ken Griffin.