EU endorses gas, nuclear energy amid opposition among member states

The European Commission decided to include nuclear energy and gas in its sustainable finance taxonomy. After months of debate and political lobbying, the EU’s executive arm presented a draft for low-carbon, green investments and sent it to member states for consideration. The document is a guide that would define sustainable economic activities within the framework of the European Green Deal.

Austria said it would launch a lawsuit against the European Commission if the proposal for the taxonomy of nuclear energy stays in the current form. The European Green Party is considering to do the same. It is unlikely that 20 out of 27 EU countries would oppose the draft, which would be necessary to reject it.

Nuclear energy and gas are intended to be used during the transition toward carbon neutrality

The green taxonomy is a guide with conditions for investment in energy projects. The commission aims to facilitate a switch to renewables almost entirely but it is willing to allow gas and nuclear power projects in the transition period. Its top officials claim the solution would prevent greenwashing – which is when companies or countries promote projects harmful for the environment as sustainable.

Elevated standards for green labeling

According to the guidelines, nuclear power plants with state-of-the-art technology and strict rules for waste disposal are the only ones that can be marked as green.

Only the gas power plants that operate to the highest standards can be considered for financing. Specifically, the upper limit for carbon dioxide emissions is 100 grams per kilowatt-hour of energy produced.

The draft proposal was released on December 31 and the countries can respond by January 12. The commissioners said the final version could be adopted by the end of January, and that the rulebook would be valid from 2023.

Months of political lobbying preceded the commission’s proposal, with many opposing views among member states. Some argue they need to invest in gas for a faster coal exit. Others claim a green label for a fossil fuel would undermine the credibility of the EU as a global leader in the fight against climate change.

The proposal provokes conflicting reactions – the commission sets a compromise solution

Austria announced the lawsuit against the European Commission for nuclear approval, and the European Greens are considering the same. The document has sparked some more controversies within the EU.

The German Greens took a similar stance as Austria, primarily out of fear of the consequences of nuclear waste disposal. Last week Germany closed three of its six remaining nuclear plants.

Austria announced a lawsuit while Germany accuses the EU of greenwashing

German Vice-Chancellor Robert Habeck accused the commission of greenwashing in the energy sector with the new taxonomy. He said such a plan would “water down current efforts.”

The energy mix varies between countries and each member can determine its own version, the commission said. It added the taxonomy is a matter of compromise and it is envisaged to guide the investments in energy towards achieving the EU’s goal to become carbon neutral by 2050.

Czech government claims the criteria are too strict

The Czech Republic supports the endorsement of nuclear but its government expressed concern over high standards, saying they can make the transformation of the entire energy sector more complicated. The country called on other EU member states to cooperate and revise the conditions set out in the document.

Another nuclear plant is scheduled to be built in Dukovany by 2036 as the old one should be decommissioned while there are also plans to expand the existing Temelin facility. Both are operated by ČEZ Group. Its Chief Executive Officer Daniel Beneš pointed out that the EU should be precise with regard to the deadlines for nuclear power plant operators, especially as it could affect the decarbonization of district heating.

Yet, the European Commission believes that nuclear energy is sustainable only temporarily, according to the Czech energy sector.

The Czech Republic asked for a revision

At least 30 percent of gas needs to come from renewable or low-carbon sources by January 2026 while fossil gas must be completely replaced by 2035.

Support, lobbying for nuclear, gas

France and Poland led a group of countries that insisted nuclear energy should be a part of the EU’s green taxonomy. Bulgaria, Romania, Hungary, Croatia, Slovakia, Slovenia, Finland and the Czech Republic were part of the initiative, which was also backed by Belgium, Sweden, Estonia and the Netherlands.

At the same time, Cyprus, Germany, Hungary, Greece, Romania, and Malta are lobbying for gas energy projects in the EU taxonomy. Austria, Luxembourg, and Denmark are explicitly opposed to support for both fossil gas and nuclear power.

Serbia will decide this year whether to build nuclear power plants

Of note, Serbia expects to reach a decision this year on the possibility to build small nuclear power plants with modular reactors, Minister of Mining and Energy Zorana Mihajlović said. Serbia intends to adopt new strategy for energy development this year.