How to Invest in Nuclear Power

The new generation of nuclear power plants feature improved designs and better safety systems.

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As the price of oil makes producing electricity more expensive, nuclear power becomes less of an option and more of a necessity. The European Nuclear Society reports that as of Jan. 2013, 437 nuclear power plants are in operation worldwide and another 68 are under construction. Along with oil, coal and natural gas, nuclear power offers investors an additional way to profit from increasing energy demand. Investors can purchase shares in an exchange-traded fund that covers the entire nuclear power industry, or select stock in a company that focuses on one aspect of it.

Uranium Mining Stocks

Uranium is the primary source of nuclear fuel. Although uranium is mined worldwide, Canada and Australia are the two major producers. Mining companies explore, mine and refine the raw ore. All uranium-mining companies are heavily monitored by national and international agencies. Some companies devote their operations solely to finding and extracting uranium deposits. Others mine uranium in addition to gold and silver, as well as drilling for oil.

Public Utility Stocks

Electricity-producing utilities are building new nuclear power plants to meet increasing customer demand. The built-in monopoly electric utilities have makes them attractive to investors seeking long-term stock growth and consistent dividends. At the time of publication, 30 public utilities operate 100 nuclear power plants in 31 states. There also are at least two applications awaiting approval for new plants, and two are under construction.

Construction Company Stocks

Building nuclear power plants is labor-intensive, costly and highly regulated. As a result, only a handful of companies build them. The renewed interest in nuclear energy combined with the number of applications pending approval and new permits issued could make this an investing opportunity.

Uranium ETFs

At the time of publication, there are two exchange-traded nuclear power funds. One holds stock in approximately 20 companies and is geared toward nuclear energy companies rather than uranium production. The other concentrates on uranium mining and production operations.