France bets on more nuclear power in face of Europe’s energy crisis

Macron announces €1bn investment by 2030 as political and public opinion shifts

Anna Gross in Paris for the FT 12.10.21

President Emmanuel Macron has said France will invest €1bn in nuclear power by the end of this decade as Europe’s energy crisis spurs renewed interest in the contentious source of power.

“The number one objective is to have innovative small-scale nuclear reactors in France by 2030 along with better waste management,” he said while announcing a “France 2030” investment plan on Tuesday.

France is a bastion of nuclear power in Europe, with more than 70 per cent of its electricity derived from nuclear plants. However, after the disastrous 2011 explosion at a plant in Fukushima, Japan, and big cost overruns at a new plant in Flamanville, north-west France, national pride around France’s nuclear capability eroded.

Early in his presidency Macron announced the intention to shut 14 reactors and cut nuclear’s contribution to France’s energy mix from 75 to 50 per cent by 2035.

But the mood has now changed. Macron said on Tuesday he would begin investing in new nuclear projects “very quickly”.

“We will continue to need this technology,” he said.

Approval of nuclear plants is also a way for Macron to show his pro-nuclear credentials when a number of his most likely challengers in next year’s presidential election are pushing for more investment.

“Nuclear is coming [back] to the fulcrum of the energy debate in France and much faster than I ever thought it would,” said Denis Florin, a partner at Lavoisier Conseil, an energy-focused management consultancy.

Advocates say nuclear power’s availability and predictability has proved its worth at a time of soaring gas prices — while renewable energy remains volatile and difficult to store. Those advantages, which have protected French industrial companies and consumers from the most severe price hikes seen in other parts of Europe, have begun to outweigh lingering safety concerns.

French households pay less for electricity than other EU countries.

About 25 per cent of France’s electricity is sold at a regulated price of €42 per megawatt hour (MWh). The rest is subject to wider market prices and, specifically, a European pricing mechanism that means countries pay for the last unit of energy consumed — normally gas — which has led to some frustration among French consumers.

Bruno Le Maire, France’s finance minister, has advocated a complete overhaul of Europe’s electricity pricing mechanism, which he argues unfairly prevents French citizens from fully benefiting from the country’s nuclear capability.

French businesses pay less for electricity than other EU countries France also wants nuclear energy to be labelled as “green” in the evolving EU green finance taxonomy that determines which economic activities can benefit from a “sustainable finance” label.

France and eastern European capitals want to show investors that nuclear energy is part of the EU’s journey towards carbon neutrality, while Germany and others have resisted, pointing principally to the environmental impact of nuclear waste.

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France bets on more nuclear power in face of Europe’s energy crisis - Anna Gross in Paris
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