The Pivot Back to Reliable ‘Always On’ Energy

On Wednesday, I gave you a taste of the energy investment theme.

You’ll see more of this from me in the weeks ahead. There are several reasons for that:

China knows that it needs enormous amounts of reliable energy to grow economically, overtake the US, and cement its place as the global superpower.

AI, electric vehicles, drones, robots, crypto… All the tech that the world’s most powerful countries are racing to control is highly energy-intensive.

Take AI… According to the International Energy Agency, the electricity needed to run AI datacentres is set to DOUBLE over the next five years.

In the States… research shows that electricity demand from AI could grow 30 times bigger in the next decade.

This requires ‘always on’ energy!

Oil, gas, coal, nuclear… Fuels that deliver vast quantities of cheap, 24/7 energy.

That’s why China…

Built 95GW of new coal power last year – the highest in a decade.

It’s constructing 10 new nuclear power plants—for $27 billion—to become the biggest nuclear power in the world.

And by 2035, it is expected to have up to 150 reactors nationwide.

But it’s also building new gas and oil pipelines at a rate of 4,000 kilometres a year.

And it’s not just Beijing…

After decades of watching China ignore ‘Net Zero’ pledges… and use cheap energy to fuel its manufacturing and massive growth… The rest of the world is also finally pivoting back to these fuels.

It’s a massive U-turn that could be described as the death of the ‘Net Zero’ agenda.

Simply put, China has left other countries no choice.

If they want to compete… they have to pivot back to fossil fuels or get left behind.

It’s not an economic decision… but EXISTENTIAL.

That’s why President Trump has taken the US out of the Paris Agreement.

Axed $7 billion in solar funding.

He declared he would ban ALL new wind and solar projects, calling them “THE SCAM OF THE CENTURY!”

Instead, he’s taking the US BACK to nuclear, coal, gas and oil…

He’s cut red tape to keep the US coal fleet active… he’s lining up a $44 billion gas deal with Japan and South Korea… and aiming to QUADRUPLE US nuclear power by 2050.

America and China aren’t the only ones making this U-turn…

Reuters reports an “abrupt reversal” in EU fossil fuel use… with member states cranking up output from gas—and coal-fired power plants this year.

The Germans just dropped their decades-long opposition to nuclear power in what’s being called a “sea change policy.” Their clean energy use dropped to its lowest in a decade, while fossil fuel use hit a decade-high.

And India is building US$80 billion worth of coal-power projects by the decade’s end.

And where national interests come together, the global corporations are never far behind…

The world’s largest banks – BlackRock and JPMorgan – have withdrawn from the Net-Zero Banking Alliance.

Collectively, they invested nearly US$900 billion in fossil fuel firms last year, up $162 billion from the previous year.

BP is slashing its clean energy spending by $5 billion… and ramping up oil and gas investment to $10 billion. Its CEO says they went “too far, too fast”. Shell and Equinor have also scaled back their clean energy plans.

General Motors just killed plans to make electric motors at a factory in New York and will instead invest nearly US$900 million in building V-8 gasoline engines there.

‘Sustainable’ ESG funds have seen record outflows, with many funds closing as money floods back into fossil fuels.

Amazon, Meta, and Microsoft have secured massive nuclear power supply deals, and Microsoft is even renting its own nuclear power plant on Three Mile Island.

Here’s the important bit for you…

Australia sits on the world’s largest reserves of uranium… the third largest of coal… and vast quantities of natural gas.

A breadbasket of reliable ‘always on’ energy to fuel the global AI race.

A race that is limited by how much energy counties can capture.

If you’re ready to explore this opportunity and buy quality energy stocks at a major cyclical low, you can check out my latest presentation here.

Enjoy!