ETFs
AI’s Insatiable Energy Needs Boost Uranium ETFs – May 14, 2024
Tech giants Microsoft (MSFT – Free report), Google’s parent Alphabet (GOOGLE – Free report), Amazon (AMZN – Free report), and meta (META – Free report) reported massive investments in artificial intelligence and cloud computing in their latest earnings reports.
The AI boom has led to increased demand for data center capacity to handle AI workloads and store the large amounts of data they require. Data centers are power hungry, and AI applications consume even more energy than traditional computing.
Many tech giants have committed to using renewable energy to power their data centers, driven by sustainability goals. And they are increasingly exploring nuclear power for their energy needs.
Governments around the world have also recognized that nuclear power could be one of the main options for meeting their net-zero emissions targets.
Uranium, mainly used in nuclear power plants, is one of the most carbon-free means of producing electricity. However, nuclear power currently accounts for only about 10% of global electricity generation and about 20% in developed countries, including the United States.
As demand for uranium continues to increase, supply faces many challenges. Increasing the supply of uranium will take a long time.
President Biden yesterday signed a bill banning the import of Russian enriched uranium, which includes some waivers allowing imports through 2028 if no alternative source is found. The bill provides about $2.7 billion to increase domestic uranium supplies.
To learn more about the Global X Uranium ETF (URA – Free report) , Sprott Uranium Miners ETF (URNM – Free report) and VanEck Uranium+Nuclear Energy ETF (NLR – Free report), please watch the short video above.
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