Alternative Energy Stocks Will Benefit From Japan’s Nuclear Meltdown

| March 15, 2011 | 0 Comments

I spent the weekend mesmerized by the shocking images coming out of Japan.

Just seeing the images and videos on TV and the internet are overwhelming.  I can’t imagine what it must be like to be on the ground… My heart goes out to everyone who has been impacted by this tragic event.

The fifth most powerful earthquake in the last century and the following tsunami have devastated Japan’s coastal regions.  It’s clear this will go down as one of the worst natural disasters in recent memory.

It’s brought life in northeastern Japan to a standstill.  Transportation is shutdown, communications are disrupted, and power is shut off.

And here’s the scariest part… We may not have seen the worst of it!

Japan is admitting the fuel rods in three of their damaged nuclear reactors are melting down.  We’ve already seen three massive hydrogen explosions at the nuclear facility…

At this point, it’s still unclear if the safety barriers will hold.  In a worst case scenario, the protective shield around the reactors melts away.  And a massive amount of radioactive material leaks into the ground.

The fallout from a nuclear reactor meltdown of this magnitude would have far reaching consequences.  It’s already sparking debate about the use of nuclear reactors to generate electricity.

I’ve never been a big proponent of nuclear power…

Sure it has some benefits.  Nuclear power generation creates fewer greenhouse gas emissions than coal or natural gas.  But that doesn’t make it clean… In my opinion, the risk and cost of a major nuclear meltdown far outweighs any benefits.

Nevertheless, nuclear power remains an important part of America’s energy production.  An impressive feat considering no new nuclear power plants have been built in the US since 1979.

Recently, support for new investment in nuclear power has been picking up steam.  In fact, nuclear power is the only part of the energy policy Republicans and Democrats in Congress agree on!  The nuclear industry in the US was on the verge of a major comeback.

Now the crisis in Japan has thrown the industry for a loop.  Public support for nuclear power is taking a big hit.  And it could be the death knell for nuclear power in the US…

Remember, it has been over three decades since the Three Mile Island incident.  And it’s been in just the last few years that nuclear power has re-entered the conversation.

If nuclear power is sent to the backburner for another three decades… you can kiss nuclear power in the US goodbye.  But we don’t need to wait decades to see how this plays out.  I think the public backlash against nuclear power will have an immediate impact on energy policy and production.

The clear winner will be alternative energy.

Companies whose technologies are involved with solar power, bio energy, wind power, hydro power and geothermal energy will be the winners in the long run.

It may not be today or tomorrow, but at some point alternative energy will dominate energy production.  That’s why I think it should be a core holding in any long term portfolio.

An easy way to get exposure to a wide array of alternative energy stocks is with Exchange Traded Funds (ETFs).  One of the best is the Market Vectors Global Alternative Energy ETF (GEX).  It invests in 31 alternative energy companies from around the world.

The way I see it, the crisis in Japan will only speed up the adoption of alternative energy.  And investors who have exposure to a wide range of alternative energy stocks stand to make a fortune.  Take a closer look at GEX for your own portfolio.  This is one investment trend you don’t want to miss.

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Category: Stocks

About the Author ()

Corey Williams is the editor of Sector ETF Trader, an investment advisory service focused on profiting from ETFs and the economic cycle. Under Corey’s leadership, the Sector ETF Trader has become one of the most popular and successful ETF advisories around. In addition to his groundbreaking service, Corey is the lead contributor to ETF Trading Research, where he shares his insights about ETFs and financial markets on a daily basis. He’s also a regular contributor to the Dynamic Wealth Report and the editor of one the hottest option trading services around – Elite Option Trader.

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