Following a number of nuclear asset closures throughout Midwestern and Northeastern US over the past few years, Director of US Energy Infrastructure at S&P Global Ratings, Michael Ferguson, warns of the implications that could follow continued low nuclear demand in FTSE Global Markets.
Traditionally reliant on high profit margins necessary to meet high fixed costs, today’s nuclear industry is faced with the fierce competition of low oil and gas prices, Ferguson explains. The risk of market exposure is increased by more efficient alternative energy sources – such as renewables – and improving energy efficient technologies, he adds.
As nuclear producers find it more difficult to spread their costs over poor market conditions, the long-term economic viability of nuclear assets has been called into question. The extent of the impact however, will depend on the duration of low power prices, Ferguson notes.
Please read the full article in FTSE Global Markets, here.