Where can nuclear energy fit in an ethical portfolio?

Electricity pylons on a golden sunset background
For financial professionals only

Investing is about choices - 'where should I invest?' and 'how much risk do I want to take?' are common questions.

When it comes to ethical investing, the questions get harder because you have to align your investments with your values too.

A divisive topic

Supporters of nuclear power argue that it's a source of clean, renewable and reliable energy, while critics say that it's costly to produce and dispose of, and dangerous to both society and the environment.

In the UK, nuclear power accounts for around 15% of our energy mix, with a further 34% coming from natural gas, 19.6% from wind, 8.5% from solar, 2.9% from biomass and 0.9% from hydroelectric power. The rest is imported (as of May 2023) (1)

That makes us relatively pro-nuclear, with just under a sixth of our power generated this way. We're way below France, which generates a huge 70% of its energy from nuclear power, but more than Germany (which is aiming to phase it out) at 12% (2).


Besides being clean, renewable and reliable, nuclear energy has one of the lowest carbon emission rates of all energy sources. It's lower than solar and considerably less than coal, oil and gas, making it an attractive source of energy to support the transition to net zero.

It can also provide consistent 'baseload' power i.e. operate at near capacity. In contrast, solar and wind power depend, to an extent, on weather, so arguably have the potential to be intermittent and unreliable.


The anti-nuclear movement are concerned about the damage nuclear energy causes to the environment. Uranium has to be mined and processed to generate power, creating radioactive waste. And uranium itself is a finite resource. 

The costs to develop and decommission are also a concern. Nuclear reactors typically require large upfront costs (Hinkley Point is expected to cost upwards of £25bn) and demand significant ongoing operating costs. The decommissioning cycle can last as long as the life cycle of the reactor itself, given the necessary deconstruction of the site and safe storage of radioactive fuel. This can amount to billions of pounds.

We should also consider how dangerous nuclear power can be when it goes wrong - Chernobyl and Fukushima are just two examples. Both caused huge environmental and social damage, and cost  hundreds of billions of dollars.

Despite these cons, the chart below shows nuclear power is one of the safer sources of energy. It also creates far less greenhouse gas emissions than other sources of energy:

Safe Clean Energy Image

Source: ourworldindata.org

Fossil fuel generated power are clearly worse on both accounts, while nuclear, wind and solar are generally safer overall.

Wind and solar energy are indisputably central to the transition to a net zero economy, but for those who have the appetite for it, there is an argument for the inclusion of nuclear.

Whatever your view on nuclear energy and the ethical case for using it,  it’s our job to offer investors different choices. Those who feel strongly against the use of nuclear power can choose environmental investment portfolios that specifically exclude it -  our Ethical Active Profile D and Passive ESG solutions provide this option.  And if the focus is on responsible or sustainable investing, our Ethical Profiles A to C cater for those investments tastes.

If you’d like to learn more about the differences between our Ethical solutions, please read our guide on Choosing the right ethical solution for your client.

(1) https://www.nationalgrideso.com/electricity-explained/electricity-and-me/great-britains-monthly-electricity-stats

(2) https://www.world-nuclear.org/information-library/facts-and-figures/nuclear-generation-by-country.aspx

This article is for financial professionals only. Any information contained within is of a general nature and should not be construed as a form of personal recommendation or financial advice. Nor is the information to be considered an offer or solicitation to deal in any financial instrument or to engage in any investment service or activity.

Parmenion accepts no duty of care or liability for loss arising from any person acting, or refraining from acting, as a result of any information contained within this article. All investment carries risk. The value of investments, and the income from them, can go down as well as up and investors may get back less than they put in. Past performance is not a reliable indicator of future returns.  

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