VANCOUVER (miningweekly.com) – Changing global macroeconomic trends are increasingly making more space for nuclear power to support renewable energy roll-outs, boding well for the uranium market, which has been dealing with unsustainably low prices for nearly a decade, according to former US secretary of energy and current chairperson of Uranium Energy Corp Spencer Abraham.
“Nuclear power is increasingly being thrown into the mix as states prepare to implement renewable energy strategies, and will result in new-build projects on a state level in the US. I see substantial state-level law changes coming that increasingly equates nuclear generation with renewable energy options,” he told the Sprott Natural Resource Symposium held in Vancouver this week.
Abraham believes that the US pulling out of the Paris climate accord is immaterial to global carbon emission reductions, as most states already have some policy on the books to curb emissions. There is a growing desire among states to grow cleaner power sources.
He concedes that coal is in better shape under the administration of President Donald Trump, but points out that challenges remain from cheap alternative sources of natural gas.
Uranium will be among the biggest winners as renewable power sources continue to be included in state mandates.
The number of new-build nuclear power stations is expanding at a breakneck pace in Asia and, to some extent, in the US. As a result, long-term demand for uranium enrichment facilities will also rise.
Nuclear power currently accounts for about 20% of the US energy mix, with new legislation being adopted by states such as Illinois, New York, Pennsylvania and Connecticut reflecting a substantial state law change in favour of new nuclear builds.
While the Obama administration was hostile to nuclear, the Trump administration is embracing it. “There is a growing recognition that nuclear needs to play an increasing role in the US energy strategy and we’re seeing this with increased regulatory support for the domestic uranium industry, to supply this need,” Abraham said.
This imperative is reflected in the US importing about 95% of its uranium requirements, with more than half of that being controlled by Russia-controlled entities.
“Under the Bush administration, we thought America’s requirement to import 60% of oil was a matter of national security. How much worse is this scenario regarding uranium imports? I think the new administration will look into this against the backdrop of energy security,” he stated.
This could include strengthening the domestic supply side, implementing trade policies and removing domestic regulatory burdens to permit more viable projects.
“This could go a long way to rejuvenate the US mining industry, especially uranium, and help shrink the seven to ten-year permitting timeline. We have a number of very encouraging signals that the uranium supply sector is moving in the opposite direction and growing in the next four to eight years,” he suggested.