Brussels/Strasbourg – On Wednesday, the European Parliament approved a contentious proposal giving a sustainable finance label to investments in gas and nuclear power. This is part of the EU’s classification system for sustainable financing called “taxonomy”, which intends to channel private investments to help the European Union meet its 2050 climate goal of net zero greenhouse gas emissions. The label is relevant for companies, because it may influence investment decisions and thus have an impact on project financing costs, for example. The label also enables investors to avoid investing in sectors of the economy that are harmful to the climate.
In a first step, a decision had already been taken last year to classify electricity generated with solar panels, hydro or wind power as climate-friendly. The EU Commission, under pressure from nuclear-powered France and gas-reliant Germany, argues that natural gas and nuclear power have a role to play as comparatively clean sources of energy in the transition to a net zero carbon future.
France, which currently operates more than 50 nuclear reactors and is planning to rely on the technology to cut carbon emissions, has been particularly keen in recent months to add nuclear energy to green investment portfolios. Poland has also said that greater investments into in gas and nuclear would help the country move away from coal. Out of 27 EU member states, around half have nuclear power plants.
Proponents and opponents have arguments
20 trade unions in the energy sector in Bulgaria, Belgium, Czechia, Finland, France, Hungary, Lithuania, Romania, Slovakia, Slovenia and Croatia supported the inclusion of nuclear and gas in the EU taxonomy.
“In the event of a positive vote on the resolution, nuclear energy would be excluded from the taxonomy, and this would be harmful to Slovenia, its citizens and the environment,”the association of Slovenian nuclear experts said.
According to them, the use of nuclear energy in Slovenia makes an important contribution to the reliability and stability of power generation, reduces greenhouse gas emissions, stimulates development and increases the domestic share of production.
As such, nuclear power is the basis of Slovenia’s energy independence and part of REPowerEU, the EU’s strategy to eliminate its dependence on Russian fossil fuels, the nuclear experts added. The association also highlighted that maintaining nuclear power in Europe was crucial for the transition to a climate-neutral society.
In Italy, politicians are divided. The Italian Minister for Ecological Transition, Roberto Cingolani, finds clear words:
“Science is not an opinion, it is numbers. And the numbers say that at the level of greenhouse gas emissions, nuclear power is more advantageous than other technologies,”Cingolani said in an interview with TG2.
Cingolani rather sees the future in new technologies such as nuclear-powered icebreakers “that do not use uranium, produce zero waste, need little power, but are intrinsically safe.”
Critics of gas point to the war in Ukraine as the most urgent reason to reject the green label, saying that encouraging investment would only increase dependence on Russian supplies. Whereas opponents of nuclear power emphasize the threat posed by accidents and nuclear waste and believe solar and wind energy is the best way forward.
Resistance by Austria and Luxembourg
Czech Prime Minister Petr Fiala described the legal act as a “hard negotiated and fragile compromise.” A number of EU states can only meet their obligations under the common climate targets with such rules, the liberal-conservative politician argued on Wednesday. The EU aims to become climate-neutral by 2050.
The proposal was met with particular resistance from Austria and Luxembourg. Ministers from both countries reaffirmed their intention to pursue legal action against the labelling, should it not be blocked by member states before coming into effect.
Austrian Climate Protection Minister Leonore Gewessler tweeted that Austria will file an already prepared request for annulment with the European Court of Justice (ECJ), as soon as the “greenwashing program” takes effect. The Green politician added that she would now seek to “win more allies.”
“We have already prepared ourselves intensively for this case in recent weeks and months and will file our lawsuit within the deadline set for this,”Gewessler stated on Wednesday.
However, it is unlikely that Austria and Luxembourg will find enough allies to prevent the bill from coming into effect.
Blockade by a majority of member states considered impossible
The implementation of the Commission’s proposal can still be prevented if at least 20 EU states representing at least 65 percent of the total EU population join forces by July 11. However, due to the vested interest of many states in the use of nuclear power, it is considered impossible that such a majority will be achieved in the Council of the EU. The legislation will therefore probably come into force at the beginning of 2023.
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