Lately, the nuclear-power sector has been enjoying something of a revival, because of its operating-cost advantages over other forms of electricity production. That may prompt investors to bet on its resurgence by buying shares in nuclear power plant operators, equipment makers or fuel producers.
The economic appeal of nuclear power has risen as prices for natural gas and coal - fuels for the bulk of America's electricity - have climbed. The price of natural gas, especially, has soared. In October, it touched $14 per million British thermal units. That was nearly double the price from October of last year. "There's a big advantage for operating a nuclear plant when gas prices are in the $5 range, much less where they are today," said John C. Kohli, portfolio manager at the Franklin Utilities fund.
Many people, of course, still worry about inadvertent releases of radiation and about the long-term storage of radioactive waste. But in some circles, those fears are beginning to be overtaken by an appreciation of nuclear power's competitive advantages. As concern about global warming has become mainstream, some investors are reminded that nuclear power produces no greenhouse gases. And while nuclear power plants could be vulnerable to a terrorist attack, war and recent hurricanes have underscored the fragility of fossil-fuel supplies. Federal lawmakers have given nuclear power a nudge, too, with a raft of subsidies in the Energy Policy Act this year.
"The incentives in there were a bold statement that nuclear is going to be an important part of the U.S. electricity supply in the future," said Timothy P. O'Brien, manager of the Evergreen Utility and Telecommunications fund.
The economic appeal of nuclear power has risen as prices for natural gas and coal - fuels for the bulk of America's electricity - have climbed. The price of natural gas, especially, has soared. In October, it touched $14 per million British thermal units. That was nearly double the price from October of last year. "There's a big advantage for operating a nuclear plant when gas prices are in the $5 range, much less where they are today," said John C. Kohli, portfolio manager at the Franklin Utilities fund.
Many people, of course, still worry about inadvertent releases of radiation and about the long-term storage of radioactive waste. But in some circles, those fears are beginning to be overtaken by an appreciation of nuclear power's competitive advantages. As concern about global warming has become mainstream, some investors are reminded that nuclear power produces no greenhouse gases. And while nuclear power plants could be vulnerable to a terrorist attack, war and recent hurricanes have underscored the fragility of fossil-fuel supplies. Federal lawmakers have given nuclear power a nudge, too, with a raft of subsidies in the Energy Policy Act this year.
"The incentives in there were a bold statement that nuclear is going to be an important part of the U.S. electricity supply in the future," said Timothy P. O'Brien, manager of the Evergreen Utility and Telecommunications fund.
