Signal Berlaymont: Europe's leaders must embrace the nuclear power renaissance

Once shunned, nuclear power is back, in a big way. A number of developments in the last week show this.

France's new finance minister is 33 year-old Antoine Armand. He is a strong proponent of nuclear power, and a vocal critic of energy policies that rely on intermittent renewables. He chaired an investigative commission warning France had neglected the security of its energy supply.

Earlier this year, Armand stressed the importance of “the principle of subsidiarity”. Originating in Catholic social thought, this principle holds decisions should be taken at as close a level as possible to citizens. The EU should only be involved when it offers clear added value. Applying this to energy policy, he questioned the EU’s binding target for 42.5 per cent of energy to be renewable by 2030. He stated: “If the European objective is carbon neutrality, let’s (…) start from the objective of decarbonisation rather than from a technological bias”: He added: “Especially when some member states think it is right to exclude nuclear power from the European objectives, even though it is a decarbonised energy, they are scoring an own goal.”

In other words, it's one thing for the EU to tell member states to reduce their CO2 emissions. It's quite another to say they need to use a minimum percentage of “unreliables”, as “renewables” have come to be known.

Armand is bound to clash with the two EU commissioners-designate responsible for energy policy. Both Spanish socialist Teresa Ribera and Danish socialist Dan Jørgensen are are notoriously anti-nuclear. But he will remind them the EU Commission is required to “encourage” nuclear energy. This is a result of the 1957 Euratom Treaty. And Armand’s grandfather Louis, as it happens, served as Euratom’s first president.

Nuclear renaissance   

Global financial institutions worth $14 trillion signed a statement calling for tripling the world's nuclear energy capacity by 2050. This is yet more good news for nuclear power. It reinforces a declaration made at last year’s COP28 international climate conference about the need to triple nuclear energy production in the next two and a half decades. That was signed by a broad group of countries, including the United States and the United Kingdom, and EU member states ranging from Sweden, Bulgaria, Croatia, Czechia, and Finland, to France, Hungary, the Netherlands, Poland, Romania, Slovakia and Slovenia. Meanwhile, Italy just presented plans to reintroduce nuclear power, reversing the country’s nuclear phase-out decided on in 1987.

In another new development, Czechia selected British company Rolls Royce to implement its proposed small modular reactor (SMR) programme, working with Czech state utility ČEZ. This reactor will deliver consistent power for at least 60 years. Rolls Royce has secured the first order from a European government to build a fleet of mini nuclear reactors. The deal may generate billions of pounds of export orders for UK industry. Rolls Royce's first reactor will likely be built in the mid-2030s. It will be a useful addition to a field where only three SMR designs are now in operation: one in China, one in Russia, and a test reactor in Japan.

Due to their small scale, SMRs won’t suffer the budget overruns and delays plaguing large-scale nuclear-power projects. In Britain, the Labour government now wants the technology to play “an important role” in UK energy security.

Meanwhile, in Belgium, negotiations for a new government coalition continue. Amid warnings Belgian electricity consumption will double by 2050, it is now virtually certain a legal ban on new nuclear power plants will be scrapped. The new coalition is likely to extend as many as possible of the country’s existing nuclear plants, but for that, it needs to agree a deal with their owner, French state-owned company Engie. There is hardly any political support left for economically suicidal Green policies to shut down these nuclear plants prematurely.

On September 25, in a sign of the times, the leaders of Germany’s fanatically anti-nuclear Green Party resigned, after a string of humiliating election defeats.  

Alternatives to current climate policies  

Never mind new nuclear plants. Both US top officials and nuclear plant directors have confirmed existing nuclear reactors can run for 100 years. Given such a lifespan, policies throughout the West to shut them down look more problematic.

The change in the public mood is evidence of the overall growing scepticism about the EU’s punitive approach to climate policy. Brussels has imposed its carbon tax, central planning, regulation and climate tariffs. Alternative climate policies are starting to emerge, though. One comes from the Warsaw Enterprise Institute and like-minded think tanks. In a new study, they suggest replacing the collectivist “Paris Agreement” with a “Climate & Freedom Accord". This international treaty would see signatories benefit from trade advantages if they implement climate-friendly free-market policies.

The think tanks argue this would “de-bureaucratise the economy”, along with  “tax changes (...) to make investing in PP&E (Property, Plant, and Equipment) more profitable in a way that incentivises companies not only to maintain their current capacities but also to modernise and develop new projects. Subsidies of any kind should be abolished in an orderly and gradual manner.” As economies become more innovative, this benefits the environment. Even if you don't care about climate change, these reforms still make sense.

Von der Leyen

In a properly liberalised energy market, nuclear power may still not be dominant. Its opponents point to state support nuclear power has received in the past. But looking at the extremely long lifespan of nuclear reactors, and the fact every other competing energy source is also strongly subsidised (by taxpayers' money or regulation), the odds for nuclear to become the dominant energy source start to look pretty good.

Unfortunately, European Commission president Ursula von der Leyen hasn't yet considered any alternatives to her Green Deal climate policy approach. This week, she exclaimed “carbon pricing works”. This is when the European car manufacturers lobby, ACEA, just sounded the alarm over new EU CO2 targets for cars and vans coming into effect in 2025, which will make Europe’s car manufacturing crisis even more severe. According to von der Leyen, the challenge is “encouraging more countries to join the movement”. In other words, let’s hope the rest of the world copies the EU’s ill-conceived policies.

It is telling that last year, the European Parliament was more sensible than the European Commission when it came to energy policy. The parliament urged the Commission to expand its list of “net zero technologies” to include nuclear energy of all types, not just innovative third and fourth-generation nuclear power technologies.

On September 20, Microsoft announced it would revive a Three Mile Island reactor in Pennsylvania previously shut down in 2019. The decision is to fuel the company’s ambitions for artificial intelligence, which requires enormous supplies of electricity. In Europe, EU overregulation (like the GDPR data regulation) has stifled digital innovation. EU-directed climate policies have also driven up energy costs to uncompetitive levels. This expensive energy will now make the EU even less competitive when it comes to digital innovation, which should make alarm bells sound. Europe needs to embrace nuclear power. Now public opinion has completely turned around on the issue, the remaining opponents in the European Commission should get in line.