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Investing in nuclear power? Don’t. It’s a scam

Don’t Invest in Nuclear Power. It’s a Sucker’s Bet. It was a Scam!   Energy and Capital  by Jeff Siegel February 21, 2017 Donald Trump is considered to be one of the greatest salesmen of all time.

But not even Trump would be able unload this steaming pile.

Last week, after Toshiba (OTCBB: TOSYY) projected a $6.3 billion write-down for its nuclear unit, management announced it was looking to sell its majority stake in Westinghouse, for which it paid $5.4 billion in 2006.

More than 10 years ago, the suits at Toshiba were overly optimistic about their ability to roll out a new generation of nuclear power plants that would be smaller, cheaper, and safer.

Today, they have four under construction in the United States and all have run into technical hiccups and cost overruns.

All in all, it was a big bet on a nuclear renaissance that, as I’ve warned dozens of times before, will never materialize in the U.S. The economics didn’t make sense 60 years ago, and they don’t make sense today….any hope of a nuclear power renaissance is based on nothing more than false hope and the illusion that’s often paraded around by lawmakers who have skin in the game.

A Very Risky Bet

In all fairness to Toshiba, the company did the Westinghouse deal right after the U.S. government ponied up a bunch of loan guarantees, tax credit packages, and cost-overrun backstops for nuclear power development.

With Washington bullish on nuclear, management likely figured it could rely on the government to help hedge some of the risk that comes along with building massive industrial projects such as nuclear power plants.

But it wasn’t enough…….


February 25, 2017 - Posted by | general

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