The European Commission has published the rules for sustainable finance, also known as "EU taxonomy" intended to help investors and consumers identify economic activities that can be considered environmentally green.

Nuclear was not mentioned once in the detailed 66-page Final Report, developed by the Technical Expert Group (TEG) on Sustainable Finance.

The 593-page Technical Annex contained a few brief paragraphs relating to “TEG deliberations on nuclear energy”.

It acknowledged that: “Nuclear energy generation has near to zero greenhouse gas emissions in the energy generation phase and can be a contributor to climate mitigation objectives,” and that “consideration of nuclear energy by the TEG from a climate mitigation perspective was therefore warranted”.

However, it said the proposed Taxonomy regulation and TEG’s methodology for including activities in the Taxonomy “explicitly includes two equally important aspects, Substantial Contribution to one environmental objective and Do No Significant Harm (DNSH) to the other environmental objectives”.

TEG said it used evidence and expert opinion from others, “but ultimately was mandated to make recommendations about the inclusion of economic activities and screening criteria in the Taxonomy”.

It said: “Evidence on the potential substantial contribution of nuclear energy to climate mitigation objectives was extensive and clear. The potential role of nuclear energy in low carbon energy supply is well documented.”

However, on potential significant harm to other environmental objectives, “the evidence about nuclear energy is complex and more difficult to evaluate in a taxonomy context”.

Waste management: why it proved an issue

TEG said it considered “scientific, peer-reviewed evidence of the risk of significant harm to pollution and biodiversity objectives arising from the nuclear value chain”.

Evidence regarding advanced risk management procedures and regulations to limit harm to environmental objectives was also received. “This included evidence of multiple engineered safeguards, designed to reduce the risks”.

However, TEG said that “despite this evidence, there are still empirical data gaps on key DNSH issues”, for example, long-term management of high-level waste (HLW).  

“There is an international consensus that a safe, long-term technical solution is needed to solve the present unsustainable situation.

"A combination of temporary storage plus permanent disposal in geological formation is the most promising, with some countries leading the way in implementing those solutions. Yet nowhere in the world has a viable, safe and long-term underground repository been established.”

TEG said it was, therefore “infeasible” to undertake a robust DNSH assessment “as no permanent, operational disposal site for HLW exists yet from which long-term empirical, in-situ data and evidence to inform such an evaluation for nuclear energy”.

Given these limitations, “it was not possible for TEG, nor its members, to conclude that the nuclear energy value chain does not cause significant harm to other environmental objectives on the time scales in question”.

It concluded: “The TEG has therefore not recommended the inclusion of nuclear energy in the Taxonomy at this stage. Further, the TEG recommends that more extensive technical work is undertaken on the DNSH aspects of nuclear energy in future and by a group with in-depth technical expertise on nuclear life cycle technologies and the existing and potential environmental impacts across all objectives.”

These conclusions are not surprising given the composition of TEG, which included no technical expertise capable of adequately evaluating the complexity of nuclear energy.

Of the 32 organisation represented on TEG, The vast majority were in the financial sector (22). Others represented media, manufacturing, research and environmental interests. Only two were in the energy sector – Eurelectric, which represents no nuclear interests, and EnBW, which is implementing Germany’s nuclear phase-out policy.

EU Taxonomy: a tool to help plan and transition to net zero

The Final Report said that “despite widespread recognition of the challenges that humanity faces, the current level of action aimed at changing course is too weak.”

It added that “a focus on sustainable environmental outcomes, including new tools, is needed to enable transition to a sustainable economy”.

It noted that “the trajectory of today’s economy is not consistent with the EU’s environmental goals” with few sectors of the economy operating at a net-zero level, and emissions are not reducing fast enough.

It said the Taxonomy “is a tool to help plan and report the transition to an economy that is consistent with the EU’s environmental objectives”.

A key component of the European Green Deal is the proposed ‘Climate Law’ embedding a legal commitment for the EU to achieve climate neutrality by 2050.

“In establishing thresholds for Taxonomy screening criteria, the TEG understands climate change mitigation objectives to mean net-zero emissions by 2050 and a 50–55% reduction by 2030, consistent with the commitments under the EU Green Deal,” the report said.

“To reach these goals, the TEG recognises that sectors already at near-zero carbon levels must be expanded, and heavily emitting sectors must rapidly decarbonise.”

Industry responds to EU taxonomy decision

Clearly, though it does not consider nuclear to be a key factor in this. In response, on 13 March, seven utilities wrote to the European Commission (EC), urging the establishment of an independent group of scientists and experts to evaluate whether nuclear power is a low-carbon and sustainable source of electricity.  

Czech utility ČEZ, said it had "joined the challenge" facing the main European energy companies to gain the EC's agreement that nuclear should benefit from future sustainable financing. ČEZ said that France's EDF and Orano, Finland's Fortum, Romania's Nuclearelectrica, Poland's PGE, and Slovakia's Slovenské Elektrárne had jointly urged an independent evaluation of nuclear energy.

"The technical expert group itself acknowledges that nuclear is too complex to evaluate. If the European Commission and its Joint Research Centre lack expertise in this field, then an independent expert assessment is logically needed. And from my point of view also the participation of national nuclear regulators, who have exclusive insight into nuclear facilities," said ČEZ CEO Daniel Beneš.

He noted that the EU “is already using very extensive regulations, laws and directives to ensure that nuclear energy does not and cannot cause any damage”. He added: “This also applies to radioactive waste from operations – their management is not only governed by European directives, but is also under the scrutiny of regulators and international organisations."