One of the nuclear power plant operators in the USA, Constellation Energy, has received approval and funding amounting to one billion dollars to reactivate one of the closed nuclear power plants. Following this news, the company's valuation has increased by over 5%.
Americans are increasingly facing an impending energy crisis, and Washington is taking increasingly desperate measures to prevent sharp increases in energy prices or even interruptions in supply.
Tech giants are building more data centers at an unprecedented scale and pace, and the demand for energy is equally unprecedented. Research centers, investment firms, and government institutions are warning of even triple-digit growth in demand solely due to the construction of data centers. Demand will also significantly increase due to the electrification of vehicles and the growing needs for cooling and heating, driven by ongoing climate changes.
The largest energy deficits are predicted in the regions of New England and Texas, with the infamous Three Mile Island power plant located near the former. Infamous because this plant was the epicenter of the largest nuclear disaster in U.S. history.
Soon, this power plant is expected to start producing energy again. Interestingly, although the plant's reactivation is funded by the government, all the energy is set to go directly to Microsoft's data centers.
Recent government actions suggest certain conclusions. One of them is that the administration and decision-makers are beginning to realize that without cheap electricity, it is impossible to win the competition with China, and the only real way to address the growing shortage is nuclear energy.
This sentiment is reflected in company valuations. Power plant operators, component manufacturers, and even mining companies are recording double-digit growths just this year:
- Cameco (CCJ.US) - YTD + 64%
- BWX Technologies (BWXT.US) - YTD +58%
- GE Vernova (GEV.US) - YTD +77%
Constellation Energy - CEG.US (D1)
Source: xStation5
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