Most people still underestimate just how transformational AI is. Just two weeks ago, Elon Musk said, "Basically, AI and robots are going to make so much stuff and provide so many services that they will actually run out of things to do for the humans. If we grow 1,000 times more than our current economy, you probably have already saturated anything people can think of that they want." Over the top? In the short term, perhaps. But not over the longer term. That's why the hyperscalers are collectively spending trillions of dollars now to build these data centers. There's a problem, however. These centers suck up a lot of juice. There's a power shortfall of up to 44 gigawatts for data centers through 2028. Translation: we need more energy, fast. That's why we're seeing nuclear power get back online. Illinois is lifting bans on nuclear reactors over 300 megawatts. Meta (Nasdaq: META) just secured 6.6 gigawatts of clean power for 2035 through a partnership with TerraPower. And Japan restarted the world's largest nuclear power plant: TEPCO's reactor number six will support 20% of Japan's electric needs by 2040. In addition to fueling data centers, we also need to limit global carbon emissions - and reduce the world's dependence on suppliers in the Middle East. Nuclear power is the best solution. Nuclear generation supplies nearly one-quarter of the world's clean electricity, second only to hydropower. (The Intergovernmental Panel on Climate Change notes that nuclear power generation produces just one-quarter of the emissions of solar farms.) Nuclear is by far the fastest way to scale up low-carbon electricity. And, surprisingly, nuclear power is safer than the alternatives. The famous accidents at Three Mile Island in 1979 and Fukushima in 2011 killed no one. The 1986 Chernobyl disaster caused 31 deaths, mostly as a result of extraordinary Soviet bungling. (And in the years that followed, the radiation exposure led to a few thousand early deaths from cancer.) Yet vast numbers of people are killed every day by the pollution from burning combustibles and by accidents in mining and transporting them, none of which make headlines. That's why many European countries - such as France, Belgium, Switzerland, and Sweden - depend on nuclear power. So do others in Asia and the Middle East. If we are going to make serious reductions in the amount of carbon dioxide emitted each year, nuclear will be a major part of the solution. Especially since the technology is vastly improved. Nuclear reactors are getting smaller, cheaper, and easier to make. Companies are already planning to apply the technology to a widening variety of industrial uses, including providing process heat, electrifying mining sites and powering desalination. There are currently over 430 nuclear reactors operating globally and several dozen more under construction. (There are currently 74 nuclear reactors under construction worldwide.) And a recent International Energy Agency report estimates that electricity demand from data centers worldwide will more than double within the next five years. Increasingly, data centers are turning to nuclear energy. Nuclear power is efficient, reliable and inexpensive. And the new class of reactors today is considerably safer than older models. That's why I recommended the Global X Uranium ETF (NYSE: URA) at Investment U last week. As the largest nuclear ETF (about $7.5 billion in net assets), URA offers the best balance of liquidity and diversification. It invests in a combination of uranium miners (like Cameco), nuclear component manufacturers and service providers. It's ideal for investors wanting single-investment exposure to everything from mining to power production. The fund's expense ratio is 0.69%. Its current yield is 3.8%. And its 52-week return is 139% vs. 30% for the S&P 500. My advice? Buy some shares and tuck them away for the long haul. Looking back a few years from now, you'll be glad you did. Good investing, Alex
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