Major nuclear projects will have to wait longer for delayed EIB financing

8 months ago 33

The European Investment Bank (EIB) dealt a major blow to the nuclear industry at last week’s International Nuclear Energy Summit in Brussels, when it dithered over the industry’s request for more funding for nuclear projects, but confirmed that investment in renewable energy will remain a priority until 2030.

Read the original French article here.

“What would it take for nuclear energy to make a substantial contribution to our climate neutrality target? I see a number of key challenges. The most important is to secure new investment,” said European Commission President Ursula von der Leyen at the Nuclear Energy Summit (NES) in Brussels on Thursday (21 March).

This statement set the scene for the major international conference, where some 40 official delegations attended, including those from China, India, and the United States, along with more than 300 industry leaders. All of whom had come to request more certainty on financing for nuclear power.

“We call for greater integration of nuclear energy into the environmental, social and governance (ESG) policies of the international financial system,” they wrote in a joint statement adopted at the event.

But for this to happen the world’s multilateral banks including the World Bank, Asian Investment Bank, and the European Investment Bank, must be involved they argued.

But some are “politically hesitant, not necessarily in favour of nuclear energy,” said the French president’s office, before the summit, particularly the European Investment Bank (EIB). Who did not hesitate to repeat their hesitancy during the event leaving many guests speechless.

Favouring renewables

The EIB, the EU’s investment arm, plans to invest €1 trillion between 2021 and 2025 in climate and environmental projects, including clean energy, by 2030.

In theory, nuclear projects within the EU are eligible for EIB financing, and since 2000, eight nuclear projects have been financed for more than €1 billion.

By comparison, the EIB has lent more than €10 billion for renewable energy investments in 2021 alone – a trend is set to continue as “renewable energy will be our priority until 2030,” said EIB Vice-President Thomas Östros at last week’s summit.

Nuclear projects a ‘very high’ risk

“We are a bank, and we consider the risks of [nuclear] projects to be very high,” Östros explained.

In short, the EIB’s nuclear financing strategy will not change fundamentally before 2030, said Valérie Faudon, general delegate of the French nuclear energy association Sfen.

Faudon also described Östros’s speech as worrying, though, she acknowledged that some progress had been made in this area, as “not so long ago, everyone in Brussels thought it was perfectly normal to say that we only deal with renewables,” she told Euractiv.

“In the past, potential developers were discouraged, so to speak, from applying [for EIB funding],” said Yves Desbazeilles, director general of Nucleareurope, the association representing the nuclear industry to the EU.

This was the case, for example, with the financing of the Hinkley Point C nuclear reactors in England, he told Euractiv at a press briefing on Friday (22 March). According to Desbazeilles, the problem was that “It seemed cumbersome and politically difficult.”

Financing in the future?

From now on, “it is up to the industry to push”, in other words, to motivate the financing of nuclear power, Desbazeilles argued.

But financing nuclear projects in principle is not being ruled out, as confirmed recently by new EIB chief Nadia Calviño.

At the same time, the European Commission, responsible for providing an opinion on any EIB financing, seems more inclined than before to welcome a nuclear project, especially Small Modular Reactors (SMRs).

Pressure on the EIB’s management is mounting after the French-led Nuclear Alliance’s call in early March, to open up European financing for nuclear power. This was reiterated, by 12 EU countries on the sidelines of the Nuclear Energy Summit on Thursday.

“We were in an untenable situation. The changes at the top of the EIB and Ursula von der Leyen’s speech today are a step in the right direction,” said a representative of the French nuclear industry.

As EIB investment decisions require the approval of all EU member states, the only thing left to do is to urge member states that are strongly opposed to nuclear power, such as Germany and Austria, to “change their mindset”, Andrei Goicea, head of public policy at Nucleareurope, told Euractiv on Friday.

According to information obtained by Euractiv, EIB investment projects in SMRs “could already be on the horizon.”