Uranium Prices: U.S. DOE Pushes for More Nuclear Power

While dozens of nuclear power plants are in the planning and building stages around the world, supporting future demand expectations for uranium, nuclear power use in the U.S. has been declining due to aging plants and lack of plans for new builds.

The challenge in America is the availability of low-cost natural gas, but now the US Department of Energy has issued a report suggesting that the premature retirement of nuclear plants could put the resiliency of America’s electricity grid at risk.

Last April, Energy Secretary Rick Perry issued a memorandum requesting DOE staff conduct a study to examine electricity markets and reliability, and this week the DOE released the results of the study, noting that several critical issues central to protecting the long-term reliability of the electricity grid were identified.

The DOE stated: “Hydropower, nuclear, coal and natural gas power plants provide essential reliability services and fuel assurance critical to system resilience. A continual comprehensive regional and national review is needed to determine how a portfolio of domestic energy resources can be developed to ensure grid reliability and resilience.”

The report recommends to accelerate and reduce costs for the licensing, relicensing and permitting of grid infrastructure, including nuclear power plants, and the DOE added that the Nuclear Regulatory Commission should be “encouraged to ensure the safety of existing and new nuclear facilities without unnecessarily adding to the operating costs and economic uncertainty of nuclear energy”. It suggests nuclear safety rules are revisited under a risk-based approach.

It is not clear what will come of this report, right now, but power companies cheered the findings If this report opens the way for increased nuclear power capacity in the U.S., then we can expect an even more positive outlook for uranium prices.

Leia Toovey has a B.Sc. in geology from Simon Fraser University, and her degree had a focus on resource economics. Out of school, she started working in the booming mining industry of Vancouver, Canada, covering junior mining stocks and commodities including potash, copper, nickel, oil and gold. Then she moved to New York and worked as a commodities analyst covering a breadth of commodities, from the Baltic Dry Index through the softs. As a geologist she has a greater understanding of the exploration and extraction side of commodities, and how changes in technology and the depletion of resources impact pricing. At Economic Calendar she covers a variety of commodities, providing daily technical and fundamental analysis and assessing major market developments.