Nuclear experts outline tailwinds behind the theme, from the AI buildout, to Canadian government funding, to US private enterprise
Earlier in May the Ontario government announced a cost-sharing agreement with local utility Bruce Power valued around CAD $300 million to add a new facility to the Bruce Power nuclear generating site in Kincardine, Ontario. The proposed “Bruce C facility” is expected to add an additional 4,800 megawatts of nuclear energy, which could be sufficient to power approximately 4.8 million homes, and make the Kincardine site the largest nuclear power generating plant in the world. The Kincardine development is one of many nuclear sites under way in Canada, the United States, and around the world as broader global trends continue to push demand for nuclear energy.
The management team at Portland Investment Counsel Inc. (Portland) identified this nuclear trend coming three years ago when they launched their Portland Replacement of Fossil Fuels Alternative Fund. They formed the view that nuclear power was a key potential energy generating solution for a net-zero future, given its ability to provide large-scale, low-emission, and reliable baseload power.
What has transpired in the past three years, however, continued to validate their thesis in different ways. Reshoring and reindustrializing in the developed world have ramped up demand for power in those markets, while the developing world continues to look towards nuclear as a means of powering growth. The rise in demand for AI capacity has further heightened demand for reliable power sources, including nuclear power, bringing the full force of US private enterprise and financial markets into this space. Those trends can be seen, in the performance of Portland Replacement of Fossil Fuels Alternative Fund - Series F, with an annualized return of 46.08% since its inception on April 28, 2023, 46.20% for 3 years and 129.62% for the past year as at April 30, 2026.
“$300 million to Bruce Power is comparable to other government funding initiatives, including the $1 billion provided to Ontario Power Generation for the Small Modular Reactor (SMR) project at Darlington, and $100 million provided to SaskPower to do pre-project work, which allows engagement with capacity building, etc., to supply chain development. And most importantly it provides a market signal that these projects are real and expected to go forward,” explains Christopher Deir, Chief Nuclear Officer at AIC Global Holdings Inc. “In the United States, they are very much focused on having private equity and private capital do the work for them. So, they have changed the rules to support greater participation from private investors l based upon feedback from those players.”
Dragos Berbecel, Chief Investment Officer and Portfolio Manager at Portland explains that these two contrasting styles of public and private backing can offer investors a diversified means of access. He notes the example of some US nuclear-related companies that have seen significant stock price appreciation and subsequent declines as the level of interest around AI demand waxes and wanes. Those more ‘growthy’ names are contrasted with more stable utilities companies and Canadian or global equities exposed to nuclear with deeper state backing. The fund itself has global exposures, with the largest allocation to the United States, followed by Canada, South Korea, Australia, and a cohort of European names.
“Ultimately the conclusion is: capital is likely to flow towards parts of the market where uncertainty is lower, and speed of execution is higher. So essentially, if you look at any number of different jurisdictions that might have ambitions to attract capital for any initiative,” Berbecel says. “Then investors may be more attracted towards places where there’s more certainty and higher speed of execution.”
Within that approach, Berbecel also notes that their management style has had to stay disciplined in the past year. The arrival of US private and public capital into the nuclear space has created a host of new investment opportunities. His team’s approach has been to look for long-term value creators in that mix. That has resulted in a sector balance across the Portland Replacement of Fossil Fuels Alternative Fund more weighted to industrials, followed by energy names and utilities companies, with the inclusion of some small allocations to underlying inputs like physical uranium. Berbecel describes his team as high-conviction active managers, and notes that in the early stages of a global nuclear shift focusing solely short-term performance introduces long-term risk.
For all the promise that nuclear now shows, and the vast array of projects being explored, financed, and approved all over the world, Berbecel continues to insist that the nuclear theme is a long-term view. Nuclear projects, even SMRs, take years to build and are designed to last for decades. He and Deir view this theme as an “intergenerational investment” and one that should be looked at as being in its very first days.
“We’re still at the early stages. There’s a lot of noise, but there are a lot of real projects happening. We had a term called “nuclear renaissance” from about 10 years ago. But the difference between then and now is that now we’ve got increased government support, evolving regulatory support, growing private equity support, and developing supply chain support,” Deir says. “More importantly, there appears to be strong societal support for nuclear energy. We have conditions today which did not exist 10, 15 years ago during the first nuclear renaissance. So those conditions are helping to drive it now.”
