Nuclear power no longer qualifies as "green"
Published by MAC on 2019-07-04Source: Euractiv
France put in quandary
The French state is one of the world's most nuclear-dependent energy producers.
As often described on this website, such "uranium reliance" translates into virulent French neo-colonial ventures overseas.
French nuclear to suffer after exclusion from EU’s green investment label
By Romain Thomas
EURACTIV.fr [translated by Daniel Eck]
25 June 2019
In the next five years, about half of France's nuclear reactors will turn 40. To continue operating, they will have to be renovated at a cost of around €55 billion by 2025, according to EDF and nearly €100 billion by 2030, according to a recent report by the French court of auditors.
These are considerable sums for the group whose market capitalisation amounts to several tens of billions of euros.
The European Parliament’s decision to exclude the nuclear energy sector from the list of investments that can benefit from the EU’s green investment label will have consequences for the sector, particularly in France.
Financing the energy transition is undoubtedly one of the major challenges of our century. To give itself the means to achieve its ambition, “the European Parliament recently voted in favour of a sustainable finance taxonomy project that defines a framework for activities considered environmental or green,” explained Nicolas Redon, Novethic’s green finance expert.
The main aim is to ensure capital flows are increasingly directed towards a low-carbon economy because the needs are so colossal.
On the basis of work carried out by the EU High-Level Expert Group on Sustainable Finance (HLEG), the European Court of Auditors estimated that the cost of the energy transition in Europe between 2021 and 2030 would reach more than €1 trillion per year.
Nuclear power excluded from EU's green investment label
The European Parliament voted on a proposed classification for sustainable assets on Thursday (28 March), voting to exclude nuclear power from receiving a green stamp of approval on financial markets.
Directing capital flows towards a low-carbon economy
Investments in fossil fuels and nuclear energy are no longer part of sustainable finance and hence kept away from the financing needs of the transition.
In the same vein, the European Commission is working on a “European green investment label that would make it easier to channel investment funds into clean energy by the end of 2020”, added Nicolas Redon.
Logically, the new taxonomy set up by the EU should help stimulate the supply of sustainable financial products, and therefore the sums invested in clean energies.
A decision with consequences for the sector
The European decision is not without debate. For example, a recent report published by the International Energy Agency (IEA) urges developed countries to extend the life of their nuclear power plants for electricity production.
Otherwise, the energy transition would be more complex to implement, with millions of tonnes of carbon dioxide (CO2) being released into the atmosphere.
This plea can be explained by the current situation: according to Eurostat data, atom-smashing is the leading low-carbon source of electricity in Europe ahead of hydropower.
However, reducing the lifespan of a nuclear power plant requires heavy investments that risk being penalised by the EU’s taxonomy.
Commission to tease carbon tax and nuclear treaty overhaul
The European Commission will make the case later on Tuesday (9 April) for scrapping national vetoes on environmental tax changes and for finally updating the bloc’s venerable nuclear treaty, last amended in 1957.
Nuclear renovation
This is particularly true in France where the majority of electricity is still produced by nuclear power plants according to the British think-tank Sandbag.
As a result, a gradual shutdown of their production capacity would undoubtedly require massive investments in green energy such as solar and wind power in order to meet consumer needs.
This would also have consequences for households and businesses because “this scenario of forced development of renewable energies could harm consumers because of the increase in electricity costs,” the IEA report states.
France backtracks on nuclear phase-out pledge
The French government has postponed a long-held target to reduce the share of nuclear energy in the country’s power production after grid operator RTE warned it risked supply shortages after 2020 and could miss a goal to curb carbon emissions.