Uranium: Powering the Cleanest Source of Energy
The world’s energy needs are growing with its population. However, achieving a net-zero carbon economy while meeting our growing energy needs requires a larger role for clean, sustainable, and reliable sources. Nuclear is one such energy source.
The above graphic from the Sprott Physical Uranium Trust highlights how uranium is powering one of the cleanest and most reliable sources of energy in nuclear power.
The Cleanest Energy Sources
Although all energy sources have tradeoffs, some are better for the environment than others.
To find the cleanest sources of energy, Our World in Data calculated CO2-equivalent emissions per gigawatt-hour (GWh) of electricity generated over the lifecycle of power plants for different energy sources. This includes the footprint of raw materials, transport, and construction of power plants.
|Energy Source||CO2-equivalent Emissions Per GWh (tonnes)||Type|
|Natural Gas||490||Fossil fuel|
*Emissions from biomass vary depending on the type of fuel combusted.
It’s not surprising that coal, oil, and natural gas plants emit much more greenhouse gases than their renewable and non-renewable counterparts. In fact, emissions per GWh from coal power plants are roughly 273 times higher than nuclear power plants.
Hydropower offers a cleaner and renewable alternative to fossil fuels, however, the concrete and materials used in dam construction contribute to emissions. Furthermore, the decomposition of underwater vegetation in reservoirs also releases methane and carbon dioxide into the environment. Still, emissions per GWh from hydropower are around 24 times lower than coal.
Solar and wind are often the most mentioned energy sources when it comes to the clean energy transition. However, their energy densities are lower than fossil fuels and as a result, they often require more units to generate the same amount of power. For example, generating one GWh of electricity can take more than three million photovoltaic panels, or 412 utility-scale wind turbines. Constructing these massive solar and wind farms adds up to a relatively large material footprint and consequently, GHG emissions.
This is where nuclear power comes in.
Why is Nuclear the Cleanest Source of Energy?
Nuclear power plants use fission to generate electricity without any combustion, avoiding emissions from the process of electricity generation. What’s more, on average, it only takes one typical nuclear reactor to generate one GWh of electricity. The power generation capacity of nuclear reactors is largely due to the high energy density of uranium and nuclear fuel.
According to the U.S. Department of Energy, a single, eraser-sized uranium pellet contains the same amount of energy as 120 gallons of oil or 17,000 cubic feet of natural gas. This allows nuclear power plants to generate large amounts of electricity efficiently, making them one of the cleanest energy sources per GWh of electricity produced.
Nuclear’s Role in the Clean Energy Transition
Nuclear power offers several advantages in the transition to clean energy.
Besides being carbon-free and sustainable, nuclear power is also one of the most reliable and safest sources of energy. In fact, nuclear plants in the United States have a capacity factor of 92.5%, which means that they run at maximum capacity for almost 93% of the time during a year.
As one of the cleanest, most powerful, and reliable sources of energy, nuclear power could play a key role in helping countries achieve decarbonization goals in the fight against climate change.
Retirement Spending: How Much Do Americans Plan to Spend Annually?
Retirement expenses can vary significantly from person to person. In this graphic, we show the range of expected retirement spending.
Americans’ Expected Annual Retirement Spending
Planning for retirement can be a daunting task. How much money will you need? What will your retirement spending look like?
It varies from person to person, based on factors like your health, outstanding expenses, and desired lifestyle. One helpful trick is to break it down into how much you estimate you’ll spend each year.
In this graphic from Personal Capital, we show the expected annual retirement spending of Americans. It’s the last in a three-part series that explores Americans’ spending and savings.
The Range of Retirement Spending
To determine how much people expect to spend, we used anonymized data from users of Personal Capital’s retirement planning tool. It’s worth noting that these users are proactive regarding financial planning. They also have a median net worth of $829,000 compared to the $122,000 median net worth of the U.S. population overall.
Here is the range of expected annual retirement spending.
|Expected Annual Retirement Spending||Percent of People|
Users are a mix of single individuals and people in a relationship. In all cases, expected retirement spending is what the household expects to spend annually.
The most commonly-cited expected spending amount is $60,000. Interestingly, this is roughly in line with what Americans spend annually on their credit cards. This suggests that people may be using their current bills to help gauge their future retirement spending.
Median spending, or the middle value when spending is ordered from lowest to highest, falls at $70,000. However, average spending is a fair amount higher at $100,000. This is because the average is calculated by adding up all the expected retirement spending amounts and dividing by the total number of users. Higher expected spending amounts, some in excess of $300,000 per year, skew the average calculation upwards.
Of course, given their higher net worth, it’s perhaps not surprising that many Personal Capital users expect to spend larger amounts in retirement. How does this compare to the general population? According to the Bureau of Labor Statistics, Americans age 65 and older spend about $48,000 per year on average.
Chances of Retirement Success
Once you’ve determined how much you’ll spend in retirement, your next step may be to wonder if your savings are on track. Based on an assessment of Personal Capital retirement planner users, here is the breakdown of people’s chance of success.
The good news: more than half of people have an 80% or better chance of meeting their retirement spending goals. This means they have sufficient financial assets and are contributing enough, regularly enough, to meet their expected spending amount. The not so good news: one in five people has a less than 50% chance of meeting their goals.
This problem is even more troublesome in the overall U.S. population. Only 50% of people have a retirement account, and the Center for Retirement Research at Boston College estimates half of today’s workers are unprepared for retirement.
Setting Your Own Retirement Spending Goals
While seeing the goals of others is a starting point, your annual retirement spending will be very specific to you. Not sure where to start?
Financial planners typically recommend that you should plan on needing 70-80% of your pre-retirement income in retirement. This is because people generally no longer have certain expenses, such as commuting or childcare costs, when they retire. However, keep in mind your expenses could be higher if you still have a mortgage, encounter unforeseen medical expenses, or want to splurge on things like travel when you retire.
It requires some upfront planning, but being realistic about your retirement spending can give you confidence in your financial future.
Navigating Market Volatility: Why ETFs Are Critical Tools
Historically, the trading volume of ETFs has spiked during market volatility. We explore why ETFs are preferred by institutional investors.
Download the ETF Snapshot for free.
Why ETFs Are Critical Tools During Market Volatility
Investors experienced record-breaking volatility in 2020. During COVID-19 market turbulence, the CBOE Volatility index surpassed the previous peak seen in 2008.
In this infographic from iShares, we explore how ETFs rose in popularity during this time—and the characteristics that make them particularly useful during market volatility. It’s the first in a five-part series covering key insights from the ETF Snapshot, a comprehensive report on how institutional investors manage volatility.
To assess how institutional investors navigated this volatility, Institutional Investor published a report in 2021 based on a survey of 766 decision makers. Respondents were from various types of organizations, firm sizes, and regions.
For instance, here is how responses broke down by location:
- 21% Asia Pacific
- 36% North America
- 29% Europe, Middle East and Africa
- 14% Latin America
Here’s what the survey found.
Rebalancing During Market Volatility
In total, 90% of institutional investors said they rebalanced their portfolios between the first and third quarter of 2020. How did they do it?
Among all financial tools, ETFs were the most popular vehicle for rebalancing. For instance, ETFs were used by 70% of investors globally, compared to the 51% who used mutual funds or derivatives.
The popularity of ETFs was evident in market activity. From January to March 2020, ETFs as a proportion of total equity trading volume increased.
|January 2020||February 2020||March 2020|
|ETF trading volume||$95B||$136B||$240B|
|ETF as % of equity volume||26%||27%||36%|
Based on an average of daily values. Reflects all listed U.S. ETFs across all asset classes.
This trend is true historically as well, as ETF trading volume has typically spiked during periods of volatility.
Want more institutional insights into ETFs?
Download The ETF Snapshot for free.
The Attributes Driving ETF Usage
Why are ETFs preferred by institutional investors? They offer three key characteristics:
- Liquidity: ETFs make it much simpler to buy and sell large portfolios instantly, instead of trading individual securities.
- Transparency: Among multi-asset managers, transparency of holdings is the top reason for using ETFs. A clear holdings breakdown helps these managers achieve exposures to particular asset classes, sectors, and styles.
- Efficiency: ETFs can be traded quickly. They typically also have lower transaction costs relative to the underlying basket of securities.
Based on these key benefits, ETFs were an invaluable tool during extreme market volatility.
ETFs are also poised to help institutional investors navigate the market going forward. Globally, 65% of institutional investors plan to increase their use of ETFs in the future.
In fact, this is already coming to fruition. As of September 2021, the average daily trading volume of ETFs was up more than 5% compared to 2020.
Evidently, ETFs play a critical part in helping institutional investors achieve their goals.
Download the ETF snapshot for free.
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