Nuclear Power in the European Union

(Updated September 2016)

  • The EU depends on nuclear power for more than one-quarter of its electricity, and a higher proportion of base-load power. Nuclear provides over half of low-carbon electricity.
  • Very different energy policies pertain across the continent and even within the EU, but attention is now being given to an EU Energy Union.
  • A substantial degree of transmission interconnection exists in western Europe, but much more investment is needed.
  • Electricity markets are a key to the future of reliable generation capacity, including nuclear.

NB please consult individual country papers for country-specific details, this is simply an overview.

The European Union (EU) comprises 28 countries across continental Europe which are committed to working together and sharing unrestricted trade. Since six countries founded it in 1958 as the European Economic Community free trade area, it has acquired more members, and in 1993 its name became European Union (EU). The UK joined in 1973 when it was characterised by liberalizing trade. In the 1980s and 1990s it gained political substance as members transferred some powers to it, and it increasingly became characterized by regulation, including of energy. The former East Germany was admitted as part of reunified Germany in 1990. A number of treaties agreed by member states define these central powers wielded from Brussels. The total EU population is just over 500 million.

The non-EU European countries of Switzerland, Norway and some Balkan states* are to some extent electrically networked with the EU. Following a referendum in June 2016, the UK is set to join them in 2018. Norway participates in the EU Emissions Trading System.

*Serbia, Bosnia & Herzegovina, Montenegro, Albania, Macedonia.

The European Parliament is directly elected from within each EU member state and can pass laws. The EU's broad priorities are set by the European Council, which brings together national heads of state and a rotating EU president. The interests of the EU as a whole are promoted by the European Commission (EC), whose members are appointed by national governments. The EC, based in Brussels, proposes legislation, and is then responsible for implementing it. Governments defend their own country's national interests in the EU Council.

EU energy policy, Energy Union

The EU is the largest energy importer in the world, importing 53% of its energy, at an annual cost of around €400 billion.

The new EC which took office in November 2014 had a new position of Vice President for Energy Union, related to forging a common EU energy policy, and the former portfolios of Energy and Climate Change were merged, underscoring their close connection. The Energy Union aims to integrate and strengthen the EU’s internal energy market, and its five priorities outlined in January 2015 are: enhance security of energy supply; build a single internal energy market; increase energy efficiency; decarbonise the economy; and boost research and innovation. However, two developments are cutting across the single electricity market concept, both related to ensuring that critical future demand can be met: national capacity markets, and demand response markets. France, Italy, the UK, Spain, Portugal, Italy, Greece and Ireland all offer capacity payments of some sort, which are often costly, distort the market, and run counter to the idea of phasing out fossil fuel subsidies in the long term.The UK capacity market operates about four years ahead, and more broadly, companies have several GWe of peak load under management, with growth driven by the volatile effects of increasing intermittent renewables.

In 2015 in the EU, 27% of electricity was nuclear, 27% was from coal, 17% from gas, 2% from oil, and 27% renewables (more than half from hydro). The hydro plus other renewables target for 2030 is about 46-50% of electricity (27% renewables overall), with wind and PV likely to contribute more than half of that. The power transmission system operating body (ENTSO-E) is formulating a ‘Vision Package’ to grapple with increased levels of variable renewables. This is to take forward the Energy Union strategy, and comprises four executive papers: on market design, on regions to enforce the internal energy market, on better regulation for energy in the EU, and on a new framework for European security of supply.

The EC published in February 2015 its Framework Strategy for a Resilient Energy Union, listing the key actions to be taken in order to achieve these priorities. It is a high priority to remedy the situation where ten EU member states (apart from Cyprus and Malta) do not meet the EU's minimum interconnection target – that at least 10% of installed electricity production capacity be able to "cross borders". This target is likely to rise to 15% by 2030.

The industry association Foratom commented that EU energy policy should be built upon the three pillars of sustainability, competitiveness and security of supply, to which nuclear, as a competitive, reliable and base-load source of energy, will continue to contribute. The term ‘Energy Union’ should serve as an umbrella that includes recent and future reforms in the areas of climate and energy, including emissions trading system (ETS) reform and the completion of the internal electricity market.

Others, such as Agora Energiwende, a think tank "created to manage the energy transition", say that 50% renewables in 2030 means that there will no longer be any base-load demand then, and the grid infrastructure will be used principally to back up renewables. The plants that fit this scenario are those that can ramp up and down rapidly, and load-follow normally. New nuclear plants will be disadvantaged by low load factors (5000-6000 hours per year) and because wholesale prices are reduced by renewables input. However, in the present market design these wind and solar PV sources cannot finance themselves.

The EC expected to adopt its vision for a European Energy Union by the end of 2015, with policy priorities of decarbonisation and security of supply. The electricity focus is on real-time power market, long-term investment signals, and services beyond energy supply such as balancing. The EC has noted that binding national targets for renewables do not fit well with a single EU market, and the cross-border effects of capacity mechanisms create problems. The EC sees short-term cross-border markets as core to the redesign, since these best capture the value of operational flexibility, which is vital when variable renewables start to dominate. Balancing zones will have to be bigger than today. “Most importantly, an EU-wide system for cross-border intra-day trading needs to be set up,” says the EC. At the same time, Germany’s neighbours have installed phase-shifting transformers on its borders to restrict power surges and counter the effects of Germany dumping surplus power in very windy or sunny weather. How the Energy Union will proceed is unclear.

Regarding long-term price signals, a transition to a market design that complements marginal pricing with some mechanism to support fixed cost recovery is needed. Long-term contracts can help mitigate investment risk, but must conform to EU competition law.

In February 2016, Jean-Bernard Lévy, the head of French utility EDF, said that the EU’s and France’s electricity market structure should be reformed to allow for future investments in capacity, calling for the implementation of capacity mechanisms for all EU countries as well as a carbon emissions price floor. “With electricity prices as low as they are today, overcapacity related to sluggish growth, to renewable energy development, operators today can barely cover their variable costs with this market model. Energy supply is secured, but no operator is able to invest in building new means of production without public subsidies to support them,” he said.

Lévy added: “It is now urgent to reform the current market model and to adapt it to the energy transition, by quickly implementing capacity mechanisms in order to secure energy supply, by setting a European carbon price which will be in line with the commitments made by Europe at COP 21, and by introducing a new and enhanced regulation.” See section below on ETS.

A number of eastern European countries have strong mutual political, economic and electrical network links, notably Russia, Belarus, and Ukraine, though Ukraine is forging links with the EU and plans to integrate with the European power grid and gas network to make the country part of the European energy market by 2017.


Nuclear Power in the EU


EU nuclear generation capacity

The 128 nuclear power reactors (119 GWe) operating in 14 of the 28 EU member states account for over one-quarter of the electricity generated in the whole of the EU. Half of the EU’s nuclear electricity is produced in only one country – France. The 53 units operating in three non-EU countries (Russia, Ukraine and Switzerland) account for about 17% of the electricity in the rest of Europe. Norway and Switzerland are effectively part of the EU synchronous grid (see later section on Interconnection: European Transmission Infrastructure).

Nuclear energy in the EU is governed to a large extent by the Euratom Treaty, which was one of the founding treaties establishing the EU. All EU member states are party to it by default. The European Atomic Energy Community (EURATOM) was established in March 1957 and associated with the Treaties of Rome in 1958 to form a common market for the development of the peaceful uses of atomic energy. It initially comprised Belgium, France, West Germany, Italy, Luxembourg and The Netherlands at a time when energy security was a prime concern.  The Euratom Treaty originally envisaged common EU ownership of nuclear materials. Politically it was both a counter to US dominance and a means of cooperation with the USA by providing guarantees of peaceful use, being the basis of the first multilateral safeguards system. 

The Euratom Treaty provided a stable legal framework that encouraged the growth and development of the nuclear industry while enhancing security of fuel supply for it and nuclear plant safety. Euratom has signed bilateral co-operation agreements to ease trade with its major external partners, and has played a significant role in upgrading nuclear plants in Ukraine. It also operates a comprehensive regional system of safeguards designed to ensure that materials declared for peaceful use are not diverted to military use. Today Euratom in its own right is a member of the Generation IV International Forum and the ITER consortium building a fusion reactor. It has remained substantially unchanged and is largely independent of EU parliament's control – a major point of criticism of it.

The Euratom Treaty requires the EC to periodically issue a Nuclear Illustrative Program (PINC), based on data from member states, and the latest of these was in April 2016 (the first since 2007). It forecast a decline in EU nuclear capacity to 2025 and then a levelling out to 2050 at 95 to 105 GWe. This scenario would require €45 to €50 billion to be invested in long-term operation programs and €350 to €450 billion in new reactors by 2050, as well as expenditure on decommissioning and wastes. The projected total nuclear costs to 2050 total €649 to €755 billion. This compares with the required investment of between €3.2 trillion and €4.2 trillion in the overall EU energy supply to 2050 in order to meet the objectives of the Energy Union strategy.

Although the establishment and operation of power generating capacity is undertaken on a national basis, a lot of electricity trading is undertaken across national boundaries in the EU, and any country’s energy policies have significant implications for neighbours. While economic considerations are normally paramount, energy policies relating to CO2 emissions, energy security or ideology may trump economics and skew the choice of generating technology.

Although nuclear is a proven source of low-carbon, dispatchable electricity giving a high degree of energy security and provides 53% of the EU’s carbon-free electricity, the sector today faces major challenges within the EU. Some member states are strongly anti-nuclear, and electricity markets are often structured in response to populist support for renewables. In the period to 2030, nuclear capacity that will be lost due to the closure of a number of reactors – either because they have reached the end of their operating lifetimes or due to political interference – is expected to outweigh that gained from new reactors. A slight decrease from the current EU nuclear capacity of 122 GWe is therefore expected in the near term. Total EU generating capacity in 2011 was 903 GWe, almost one-third of this in Germany and France.

Nuclear plant construction is currently underway in only three EU member states – Finland, France and Slovakia. These construction projects have all experienced cost overruns and delays. Further new units likely to come online before 2030 are planned or plausibly proposed in Bulgaria, Czech Republic, Finland, France, Hungary, Lithuania, Poland and the United Kingdom. The long-term future of nuclear power in the EU is likely to depend on the outcome of these projects, which are relatively few in number – in total less than planned in Russia.

EU nuclear power

Country 2015 nuclear generation Reactors operable at April 2016 Reactors under construction at April 2016 Reactors planned at April 2016 Reactors proposed at April 2016
  TWh % e No. MWe net No. MWe gross No. MWe gross No. MWe gross
Belgium 24.8 37.5 7 5943 0 0 0 0 0 0
Bulgaria 14.7 31.3 2 1926 0 0 1 950    
Czech Rep. 25.3 32.5 6 3904 0 0 2 2400 1 1200
Finland 22.3 33.7 4 2741 1 1700 1 1200 1 1500
France 419 76.3 58 63130 1 1750 0 0 1 1750
Germany 86.8 14.1 8 10728 0 0 0 0 0 0
Hungary 15.0 52.7 4 1889 0 0 2 2400 0 0
Lithuania 0 0 0 0 0 0 1 1350 0 0
Netherlands 3.9 3.7 1 485 0 0 0 0 1 1000
Poland 0 0 0 0 0 0 6 6000 0 0
Romania 10.7 17.3 2 1310 0 0 2 1440 1 655
Slovakia 14.1 55.9 4 1816 2 942 0 0 1 1200
Slovenia 5.4 38.0 1 696 0 0 0 0 1 1000
Spain 54.8 20.3 7 7121 0 0 0 0    
Sweden 54.5 34.3 9 8849 0 0 0 0    
UK 63.9 18.9 15 8883 0 0 4 6680 7 8920
EU 815.2  c27% 128 119,421 4 4392 19 21,840 16  

In October 2015 EU industry association Foratom proposed a target of commissioning 100 new nuclear power reactors between 2025 and 2045, total 122 GWe, to at least maintain the current nuclear capacity up to 2050 in at least 14 EU member states. Foratom recommended that there should be no nuclear-specific taxes; that the process for obtaining clearance for state aid from DG Competition must be clear and completed to a strict timetable; and that the EC should not discriminate among low-carbon technologies, including nuclear energy as well as renewable energy sources. The EU and the European financial institutions should address existing market failures in many of the member states and facilitate investment in nuclear energy projects. "This would ease the burden of high up-front capital intensity in order for the overall benefit of nuclear's competitiveness to be realised. All applications for funding should be considered on a non-discriminatory basis."

In the non-EU countries the outlook is more positive for nuclear, both in the near term and longer term. Growth in the nuclear sector of these countries will be largely driven by the deployment of Russian VVER designs. Construction is now underway in Russia and Belarus using VVER technology. Looking further ahead, Russian nuclear technology development is well ahead of any in the EU, with France the only modest challenge to that.

EU neighbours nuclear power

Country 2015 nuclear generation Reactors operable at April 2016 Reactors under construction at April 2016 Reactors planned at April 2016 Reactors proposed at April 2016
  TWh % e No. MWe net No. MWe gross No. MWe gross No. MWe gross
Belarus 0 0 0 0 2 2388 0 0 2 2400
Russia 182.8 18.6 35 26053 8 7104 25 27755 23 22800
Switzerland 22.2 33.5 5 3333 0 0 0 0 3 4000
Turkey 0 0 0 0 0 0 4 4800 4 4500
Ukraine 82.4 56.5 15 13107 0 0 2 1900 11 12000
Total 287.4   55 42,493 10 9492 31 34,455 43  

In Europe the nuclear industry creates or supports an estimated 780,000 jobs.

Energy policies and CO2 emissions

EU Emissions Trading System

The EU has led the world in creating an emissions trading system (ETS) for CO2, which is the cornerstone of EU policy to counter climate change, and a major factor in EU energy policy. The ETS is a cap-and-trade system which is seen as providing the core of a wider scheme to limit carbon emissions worldwide. By mid-2012 the ETS covered some 11,000 installations (power stations and industrial plants) in 27 EU countries plus Norway, accounting for half of the EU’s carbon emissions. In 2011, carbon to the value of about €112 billion was traded on ETS, but in 2012 this dropped to about €75 billion, its lowest level since 2008. After a positive start in 2005, in May 2006 the price of emission allowances under the ETS for the first commitment period (2005-2007) plunged to less than half their previous value, indicating fundamental problems with the efficacy of the whole scheme. Attempts have been made since then to address those problems.

In January 2014 the EC published its 2030 Framework for Climate and Energy Policies, including a legislative proposal for the ETS to establish a market stability reserve to operate in the fourth commitment and trading period starting in 2021. The reserve would both address the surplus of emission allowances that has built up in recent years and also improve the system's robustness by automatically adjusting the supply of allowances to be auctioned. In February 2015 the European Parliament voted in favour of a market stability reserve to operate from 2019.

Emissions reduction targets and means

The 2008 EC Climate and Energy Package set the '20-20-20' targets for 2020: a 20% reduction in greenhouse gas emissions from 1990 levels, a 20% renewables share in energy consumption and a 20% improvement in EU energy efficiency. The 2030 Framework for Climate and Energy Policies moved away from major reliance on renewables to achieve emission reduction targets and allows scope for nuclear power to play a larger role. It is focused on CO2 emission reduction, not the means of achieving that, and allows more consideration for cost-effectiveness. However, disincentives to high CO2 emissions remain inadequate to drive change from high dependence on coal. This was debated and largely accepted in October 2014 by EU leaders by way of taking a lead in relation to the 2015 UN climate conference in Paris, and it set collective targets to reduce carbon dioxide emissions, raise efficiency and deploy more renewables. (EC document SN 79/14)

The centrepiece of the 2030 Framework is a 'binding' 40% reduction in domestic greenhouse gas emissions by 2030 (compared with a 1990 baseline) which will require strong commitments from EU member states. Current policies and measures if followed through should deliver 32% reduction by then, so 40% “is achievable” and widely supported. It implies a 43% cut from 2005 for CO2 in sectors covered by the EU Emission Trading System (ETS) and 30% for the rest. The 40% EU target is to be broken down into 28 nationally-binding targets.

There were to be no post-2020 national renewables targets, leaving individual states free to use whatever technology they wish to achieve emission reductions in the longer term, though a 27% “headline target at European level for renewable energy” was included. In the October 2014 statement, renewables should be deployed to make up a total of 27% of EU energy by 2030 under another ‘binding’ target (in 2013 including hydro they comprised about 22%). However, these were evidently conditional upon the UN climate conference in December 2015 achieving comparable and legally-binding outcomes. A ‘flexibility clause’ was added to the final text, so that the Council “will revert to this issue after the Paris conference” and “will keep all elements of the framework under review”. As noted above, the framework also proposed reform of the ETS with a new instrument to stabilise the market, to make it the principal driver of climate policy. It will ratchet down the maximum covered emissions from the EU by 2.2% per year from 2021 onwards, an increased rate of decarbonisation compared with the 1.74% per year currently. An ‘indicative’ and non-binding target should raise energy efficiency by 27% against “projections of future energy consumption based on current criteria” and “delivered in a cost-effective manner”. See also ETS section in Policy Responses to Climate Change paper.

Impetus for the profound change in emphasis from the 2008 policy framework appears to have come from EU member states which are winding back renewables programs due to escalating costs. The International Energy Agency has pointed out the huge difference in energy prices between USA and EU, with gas prices three times as high and electricity twice as high in the EU. The EU is evidently concerned about loss of international competitiveness and the increasingly chaotic retreat from subsidy schemes related to its 2020 renewables target. More generally, it acknowledges that “the rapid development of renewable energy sources now poses new challenges for the energy system”.

Wind and solar in five EU countries, February 2016

  Wind capacity end 2015, GWe Wind output Feb 2016, TWh Solar capacity end 2015, GWe Solar oputput Feb 2016, TWh
Germany 45.0 10.6 39.7 1.2
Spain 23.0 6.1 6.7 0.6
UK 13.6 3.0 8.7 0.4
Italy 9.1 2.2 18.9 1.2
France 10.4 2.8 6.2 0.4

Platts Renewable Power Tracker, calculated load factors 32-39% for wind, 4.3-12.9% for solar

The key change from 2020 goals is “providing flexibility for Member States to define a low-carbon transition appropriate to their specific circumstances, preferred energy mix and needs in terms of energy security, and allowing them to keep costs to a minimum.” An early test of this was approval for UK plans to set long-term electricity prices to enable investment in nuclear plants. However, only weeks later, the European Parliament in a non-binding resolution voted by 341 to 263 to claw back some of the previous provisions by changing the EC draft policy to call for binding national targets of 30% of power from renewables (not 27% overall) and reinstating the energy efficiency goal to 40% improvement by 2030, along with the EC 40% greenhouse gas reduction. EU member states can however go with the EC draft policy rather than this. reports that there was 142 GWe of wind capacity installed in the EU by the end of 2015, about 131 GWe onshore and 11 GWe offshore. This comprised 15.6% of EU capacity, more than hydro. Evidently on the basis of 25% capacity factor, it could produce 315 TWh to meet 11.4% of EU consumption in a normal wind year.

In May 2016 the EC confirmed that 2008 laws requiring member states to use “at least 10%” renewable energy in transport will be scrapped after 2020, dampening a protracted controversy surrounding the environmental damage caused by biofuels. It plans to publish a revision of the EU Renewable Energy Directive at the end of the year.

In eastern Europe outside the EU there are no corresponding carbon reduction policies.

Energy Security

EU heads of state and government pledged in March 2014 to focus on energy security at their June summit, and agree on the climate and energy framework by October. They are divided on the impact of the Ukrainian crisis (Russian control of Crimea and subsequently parts of eastern Ukraine), with Germany calling for ambitious CO2-reduction, renewables and energy-efficiency goals to lower the reliance on imported fossil fuels, notably Russian gas. Russia supplies over 30% of Europe’s gas, and half of this transits via Ukraine. However, Poland and other eastern European countries wish to maintain significant dependence on domestic energy resources such as coal and possibly shale gas as a higher priority than CO2 reduction. Dependence on Russian gas is a wide concern.*

* EnergyMarketPrice 17/10/14 reported on an evaluation of the vulnerability of EU28 and ten neighbouring countries to a possible six-month halt in gas supplies from Russia: Germany is Europe's main purchaser of Russian gas, paying Russian gas exporter Gazprom approximately $15 billion a year, while EU members such as Bulgaria and Slovakia are almost completely dependent on Russian gas imported through Ukraine. A halt in Russian supplies would be a peril to markets such as Bulgaria and Britain, since these countries have insignificant gas storage capacities, of three weeks and two months respectively. Meanwhile, Germany has reserves for almost half a year, or among the biggest in Europe.

In May 2014 the European Commission proposed a new European Energy Security Strategy, in the context of its energy import dependency of more than 50%, with 39% of EU gas imports in 2013 coming from Russia. Diversifying external energy supplies, upgrading energy infrastructure, completing the EU internal energy market and saving energy are among its main points. Central to it is the urgent need for the EU to increase its indigenous energy production, improve transmission infrastructure and reduce its dependence upon external suppliers. The European nuclear industry role is vital to this strategy. The EC acknowledged that "electricity produced from nuclear power plants constitutes a reliable base-load supply of emission-free electricity and plays an important role for energy security," and that "EU industry has technological leadership on the whole chain, including enrichment and reprocessing." The EC recommended that the Euratom Supply Agency should be responsible for ensuring a diverse supply of nuclear fuel, both for the EU's current fleet of nuclear power plants and for those that are due to be built. Uranium, even though imported, represents a much lower effective dependence on external suppliers than coal or gas, since significant reserves can easily be held. Nuclear power is therefore classified as indigenous production.

Germany has its Energiewende policy involving phasing out nuclear power by 2023 and increasing its reliance on solar and wind power. Subsidies on these renewables are accompanied by giving them priority grid access, so that when they are producing they displace other sources from the grid. This reduces the load factors of gas, coal and nuclear plants, most critically in Germany but also elsewhere that these policies prevail to any degree. This compromises the economic viability of those plants, especially the newer ones which must earn money to repay construction costs. Coupled with this side effect from renewables’ grid priority is the low ETS carbon price and also low cost of coal, which makes coal-fired generation attractive. Despite concern about CO2 emissions, in 2012 some 10 GWe of new coal-fired plant was being built in Germany alone, adding to 55 GWe of coal plant operating there. While gas plants fit better as back-up for expanded renewables, they are less economic than coal, and gas supplies are uncertain, especially since sanctions applied due to Russia’s annexation of Crimea. About 35% of Germany’s gas is imported from Russia, and fracking is banned at least until 2021. A former Chancellor of Germany sits on the Gazprom board.

The International Centre for Natural Gas Information, Cedigaz, in June 2014 warned that natural gas-fired power plants accounting for almost 30% of Europe’s generating capacity are at risk of shutting or being laid up as utilities opt to burn cheaper coal. It said that EU power generators’ demand for gas had plunged 33%, or 51 billion cubic metres, in the past three years. The gas share of the EU electricity mix had slumped to 19% in 2012 from 23.6% in 2010, it said, corresponding to a 42% increase in gas prices over that period. Conversely, as US power generation took advantage of cheap shale gas, coal was exported to the EU at prices which made its use very competitive despite higher carbon emission costs. However, Cedigaz says that up to 70 GWe of older coal-fired capacity may be closed down by 2023 due to EU emission control regulations. (See Cedigaz report.)

Cedigaz reported that 25 GWe of gas-fired plants accounting for 14% of installed EU capacity were idled, shut or at risk of closing at the end of 2013, due to being unprofitable since the start of 2012. A further 25 GWe was at risk, and overall almost 30% of the EU’s gas-fired capacity could be closed down by 2016. Generation from renewable sources with priority access to the grid surpassed gas in the EU for the first time in 2012, cutting into gas-plant operating times. In Germany the average load factor of gas-fired plants dropped to 21% in 2013, and in Spain it dropped to 11%.

“Faced with low running hours and declining/negative returns, gas power operators have started to mothball or close their loss-making plants,” it said. “If all gas power plants currently under review by major European utilities are closed, this may lead to the closure of about 50 GWe of capacity by 2015-16, or 28% of the current capacity,” according to Cedigaz. “This capacity is needed to ensure security of supply when wind and sun are not producing.”

More broadly than gas, Cedigaz said that “Altogether a capacity of 115-120 GWe, representing a third of gas and coal capacity in the EU, is closing or at risk of closure, posing a serious challenge for security of supply as fossil-fuelled power generation is needed to back-up intermittent renewables. The building of flexible power capacity is threatened by the lack of market signals and adverse investment environment. This situation has the potential to unfold into a major structural crisis and must be addressed urgently.” Capacity markets are seen as a relatively short-term help, but “a more profound reform of the entire power system will nevertheless be necessary, including structural reform of the EU ETS, integration of renewables into the market and completion of the Internal Electricity and Gas Markets.”

Reuters reported that GDF Suez in France took a €15 billion writedown on its gas storage and power plants businesses in 2013.

In May 2015 investment bank UBS published a report showing that the pace of closures in the coal and gas sector in Europe was accelerating – even as the growth in wind and solar renewables steadies and, in some countries, slows. According to its data, some 70 GWe of coal- and gas-fired generation had been shut down in the last five years, and the pace is increasing: 28 GWe in 2014, 27 GWe in 2013.

UBS said that the combination of reduced demand and yet more renewable energy additions over the next two years (47 GWe) will force the closure of at least 24 GWe of coal and gas capacity, and could lead to another 30 GWe of closures just to ensure that the remaining coal- and gas-fired plants can stabilise profits. At the moment nearly half of the remaining 260 GWe of coal- and gas-fired generation in Europe (38 GWe of it in Germany) is cash-flow negative, meaning they do not earn enough money to cover basic costs. UBS described the potential closure of so much at-risk capacity as a potential disaster that could leave the system precariously balanced, with not enough capacity to meet peak demand. The report showed total capacity of 908 GWe, with 30% of that coal and gas.

In June 2015 Euratom said that the EU had ten years' supply of uranium in hand. This included large uranium inventories “which could be mobilized when needed,” fresh natural uranium inventories “that are utility-owned, inventories from underfeeding and re-enriched tails and spent fuel inventories from 1971 to today that could be reused as MOX or reprocessed uranium.”

Russian dependence

The EU has a high dependence on Russia for natural gas, and to a lesser extent, oil. Several Russian-designed nuclear power reactors get their fuel mainly from TVEL in Russia, and the older VVER-440 units depend wholly on TVEL for fuel fabrication. A lot of EU uranium enrichment is done in Russia, though other capacity is available in EU and USA.

Russian nuclear reactors in the EU are in Bulgaria (2), Czech Republic (6), Finland (2), Hungary (4) and Slovakia (4, with two more being built). Hungary has an agreement for two more to be built, and Finland is planning one with Russian equity.

Regarding nuclear fuel, the EC’s 2014 European Energy Security Strategy referred to above said specifically: "There is no diversification, nor back-up in case of supply problems (whether for technical or political reasons)." It went on to urge that: "Ideally, diversification of fuel assembly manufacturing should also take place, but this would require some technological efforts because of the different reactor designs." Westinghouse produces fuel for VVER-1000 reactors, and is increasing its supply of that to Ukraine.

In early 2015 the EC and the Euratom Supply Agency disapproved a fuel supply contract between Rosatom and Hungary’s MVM for the planned Paks II VVER plant. The contract was later approved by Euratom after the duration of the exclusive contract with Rosatom was cut from 20 to 10 years, after which time alternative suppliers would be able to bid to supply fuel. The EC reiterated that diversification of nuclear fuel supply for Russian VVER reactors is very important to it.

In June 2015 the Euratom research and training programme, which is part of Horizon 2020, the EU's research and innovation programme, provided €2 million to Westinghouse and eight European partners "to establish the security of supply of nuclear fuel for Russian-designed reactors in the EU." This is part of a Euratom project, known as ESSANUF – European Supply of Safe Nuclear Fuel – and largely concerns fuel for 16 VVER-440 reactors. Westinghouse, with Enusa, had provided VVER-440 fuel for Loviisa in Finland over 2001 to 2007.

Interconnection: European Transmission Infrastructure

More broadly than the EU, in May 2014 the power grids and exchanges in southern and north-western Europe were connected, covering about 70% of European customers and with annual consumption of almost 2400 TWh. The common day-ahead power market created through the physical and financial integration of the two regions extends from Portugal to Finland. This is expected to lead to a more efficient utilization of the power system and cross-border infrastructures, as a result of a better harmonization between energy markets. It is expected that electricity markets in the Czech Republic, Slovakia, Hungary and Romania will join similarly and then link to the rest of Europe. Poland is partially integrated with north-western region in Europe through a subsea line to Sweden. Italy's possible integration will depend on Switzerland's discussions with the European Union on connecting power systems.

In October 2014 EU leaders renewed a 2002 commitment to increase energy trading through electricity connectors to 10% by 2020, ie that much of each country’s generation capacity should be available for trade across borders. The statement said that "The integration of rising levels of intermittent renewable energy requires a more interconnected internal energy market and appropriate back up, which should be coordinated as necessary at regional level." The Baltic States, Portugal, Spain, and also Greece are priorities of electricity interconnection and integration.

In Europe, the power transmission system operating body ENTSO-E (European Network of Transmission System Operators for Electricity) comprising 41 transmission system operators (TSO) from 34 countries, has assessed the ability of Europe's grid networks to become a single internal energy market. This will require some €94 billion in new and upgraded power lines in order to meet the EU's renewables and energy market integration goals. It identified 100 power bottlenecks standing in the way, with 80% of them relating to the challenge of integrating renewable energy sources such as wind and solar power into national grids. One goal (set in 2002) is to have a level of interconnection for each country at least equivalent to 10% of its generating capacity, to achieve trans-EU electricity infrastructure. This is far from being achieved in 2013, but the above investment will bring it about for all EU countries except Spain. The EC proposes 15% interconnection by 2030, though this still needs to be defined.

In November 2015 the report from a 40-month e-Highway2050 study commissioned by the EC and involving the TSOs was released, to give a longer-term perspective on planning than provided by ENTSO-E’s ten-year network plans. The report says that Europe does not need the sort of long-distance HVDC network proposed a few years ago, but must attend to bottlenecks that need fixing by 2050. The 2030 grid plan from ENTSO-E will be insufficient to support any 2050 low-carbon future (80-95% cut in emissions). Depending on the scenario, the annual investment required is €10-20 billion per year, for an annual benefit of €14-55 billion. The expected benefits outweigh the costs in all the scenarios. Greater investments deliver proportionally greater benefits. However, the grid must relate to generation, which remains uncertain in several respects. A separate study commissioned by VGB PowerTech said that the historical rate of investment in thermal power plants must be maintained up to 2035 to back up variable renewables. Total generation investment needed amounts to about €40 billion per year to 2025, rising to €40-80 billion per year from 2030, and including gas turbines, nuclear plants and CCS. Security of supply needs to be a priority.

Much of the European investment needs to be on refurbishment or construction of about 51,000 km of extra high voltage power lines and cables, to be clustered into 100 major investment projects dealing with the main bottlenecks. "The fast and massive development of renewable energy sources drives larger, more volatile, power flows over longer distances across Europe and is responsible for 80 out of 100 identified bottlenecks," according to ENTSO-E’s 2012 Ten-Year Network Development Plan.

The TSOs said their analysis showed that extending the grid by only 1.3% enables the addition of 3% generation capacity and the integration of 125 GWe of renewable energy sources – all at a cost of 2 cents per kilowatt-hour for electricity consumers over a 10-year span. "Cumbersome permit-granting procedures and a lack of public acceptance for power lines are presently the most relevant obstacles" facing the efforts. Hence ENTSO-E proposes that each EU member state should designate a single competent authority responsible for the completion of the entire permit-granting process, which would not exceed three years.

Another goal of the EU's grid infrastructure efforts is reducing the "energy island" status of Italy, Iberian Peninsula, Ireland, UK and Baltic states. This will be addressed by the upgrades, while reducing the total generation costs by about 5%. Lithuania’s revised energy policy in 2012 involves rebuilding the grid to be independent of the Russian system and to integrate with the ENTSO-E synchronous system, as well as strengthening interconnection among the three Baltic states. (see further details of transmission developments in Baltic states in WNA Electricity Transmission Grids paper).

This EU integration was an important factor leading to Russia suspending work on its new Baltic nuclear power plant in its exclave of Kaliningrad after 14 months' construction on the first of two planned 1200 MWe units. It was designed for the EU grid. Despite endeavours to bring in west European equity and secure sales of power to the EU through proposed transmission links, the plant is isolated, with no immediate prospect of it fulfilling its intended purpose. Kaliningrad has a limited transmission link to Lithuania, and none to Poland, its other neighbour. Both those countries declined to buy output from the new Baltic plant. Lithuania does not wish to upgrade its Kaliningrad grid connection to allow power from the Baltic nuclear plant to be sent through its territory and Belarus to Russia. As well as upgrading the Lithuania link, Russian grid operator InterRAO had plans to build a 600-1000 MWe link across the Kaliningrad border to Poland and a 1000 MWe HVDC undersea link to Germany, but with no customers these plans are not proceeding. In March 2013 Rosatom said that Russia had applied for Kaliningrad to join the EU grid system (ENTSO-E), evidently without response.

Electricity markets in the EU are a key to the survival of reliable, especially base-load, capacity. Preferential access to the grid by subsidized renewable sources depresses wholesale prices so that unsubsidized plants can cease to be viable economically. In particular, where intermittent renewable sources dump their surplus electricity on neighbouring transmission systems they undermine load factors for incumbent base-load providers. Many gas plants, even very new ones, have closed as a result and nuclear plants are also affected. However, there seems no disagreement that such conventional generation will remain a vital part of the EU energy mix for the foreseeable future.

Nuclear energy cooperation in the EU

Cooperation within Europe and between Europe and third countries operates at several different levels. The European Atomic Energy Community (EURATOM) was established by one of the Treaties of Rome in 1958 to form a common market for the development of the peaceful uses of atomic energy. It initially comprised Belgium, France, West Germany, Italy, Luxembourg, and The Netherlands at a time when energy security was a prime concern. The Treaty originally envisaged common EU ownership of nuclear materials. Politically it was both a counter to US dominance and a means of cooperation with the USA by providing guarantees of peaceful use, being the basis of the first multilateral safeguards system preceding the Nuclear Non-Proliferation Treaty (NPT). It now includes all European Union (EU) members, but remains legally separate from the EU.

The Euratom Treaty provided a stable legal framework that encouraged the growth and development of the nuclear industry while enhancing security of fuel supply for it and nuclear plant safety. It covers all civil nuclear activities in the European Union and aims to provide a common market in nuclear materials, to ensure nuclear fuel supplies, and to guarantee that nuclear materials are not diverted from their intended purpose.

Euratom has signed bilateral co-operation agreements to ease trade with its major partners. It also operates a comprehensive regional system of safeguards designed to ensure that materials declared for peaceful use are not diverted to military use. Today Euratom in its own right is a member of the Generation IV International Forum and the ITER consortium building a fusion reactor. It has remained substantially unchanged and is largely independent of EU parliament's control – a point of criticism of it. Euratom funding for 2012-13 was €118 million for fission research including radiation protection and €233 million for nuclear research at the EC’s Joint Research Centre, as well as over €2.2 billion for ITER fusion project.

Euratom reports annually on EU nuclear matters, especially uranium supply. At the end of 2013 EU utilities had enough uranium inventory for almost three years, but with variation among individual countries ranging from zero to six years. 
Inventories of uranium – defined as natural uranium, or uranium that is in-process for conversion, enrichment or fuel fabrication – in 2013 totaled 53,982 tU, a 3% increase from 2012 and
 24% above the 2008 level.

In March 2013, twelve EU states joined together to promote the role of nuclear energy in the EU’s energy mix. The countries that signed the agreement are the UK, Bulgaria, Czech Republic, Finland, France, Hungary, Lithuania, the Netherlands, Poland, Romania, Slovakia and Spain. The Czech Republic is coordinating this group. A joint statement said that they are "committed to collaboration on safety and creating greater certainty for investors in low-carbon infrastructure projects." They pledged to press ahead with the deployment of low-carbon technologies, including nuclear power, renewable energy, and carbon capture and storage. In addition to the joint statement, the UK and France pledged to invest £12.5 million in funding for the 100 MWt Jules Horowitz research reactor being built in France. This is a €500 million project, half funded by France’s CEA and 20% by EU research institutes.

In July 2014 a letter to the EC on behalf of nine of these countries plus Slovenia demanded a level playing field for nuclear power among other low-emission sources in the EU so that it could play a greater role in energy security, sustainability and emissions reduction. “In our view, nuclear energy, for its physical and economic characteristics, is entitled to be treated as an indigenous source of energy with respect to energy security, having an important social and economic dimension... It is important that the market failures and the need to hedge against investment risks are accounted for in order to create the necessary market conditions for investment in new nuclear build projects in Europe. A technology neutral approach creating a level playing field for all low-emission sources is crucial.”

In Eastern Europe, consideration of future options involves the contiguous Visegrad group countries within the EU – Poland, Slovakia, the Czech Republic and Hungary. These are cooperating closely on nuclear power issues, including in research into future reactor designs and infrastructure development. They are all keen to reduce reliance on Russian gas imports. The Visegrad alliance was established in 1991 and its members became part of the EU in 2004, though the name reflects a similar alliance from 1335 set up in the Hungarian town of that name.

The EU’s Sustainable Nuclear Energy Technology Platform (SNETP) agreed by member countries, is structured around three main pillars: NUGENIA, to develop R&D supporting safe, reliable, and competitive GEN-II and GEN- III nuclear systems; the Nuclear Cogeneration Industrial Initiative (NC2I) for the low-carbon cogeneration of process heat and electricity based on nuclear energy; and the European Sustainable Nuclear Industrial Initiative (ESNII) which promotes advanced Fast Reactors with the objective of resource preservation, plutonium management, and minimizing the burden of radioactive wastes. ESNII is focused on three technology streams: SFR Astrid, LFR Myrrha and Alfred, and GFR Allegro (see Fast Neutron Reactors paper).

Energy co-operation and integration of energy networks is developing rapidly, both within the EU and between East and West Europe. The framework for such developments includes the European Energy Charter, the Energy Charter Treaty (ECT), and the Trans-European Energy Networks (TENs). The Synergy program governs the Community's general energy relations with third countries.

In 1991 EDF from France, Nuclear Electric from UK, UNESA from Spain, Vereiningung Deutscher Elektrizitätswerke from Germany and Tractebel from Belgium started a collaboration to produce standardised European Utility Requirements for light water reactors. The EUR organisation today includes 17 European utilities that might build new Generation III plants in the future (CEZ, EDF Energy, EDF, Endesa, EnergoAtom, Fortum, Gen Energija, Iberdola, MVM, NRG, RosEnergoAtom, SOGIN, Swissnuclear, GDF-Suez/Tractebel Engineering, TVO, Vattenfall, VGB Powertech). The specified common requirements serve as an important guide within Europe and beyond.

European regulation and safety

The principal responsibility for regulation and safety of nuclear facilities is with national authorities, and this independence is strenuously guarded against EU encroachment. An EC nuclear safety directive in 2009 emphasised the fundamental principle of national responsibility for nuclear safety. An amendment to the safety directive approved by the EC in July 2014 introduces a high-level EU-wide nuclear safety objective that aims to limit the consequences of a potential nuclear accident as well as address the safety of the entire lifecycle of nuclear installations (siting, design, construction, commissioning, operation and decommissioning of nuclear plants), including on-site emergency preparedness and response. It also introduces a set of rules to support the independence of national nuclear safety regulators, with a new peer review system.

The EU industry association Foratom said the directive "strengthens the role and independence of Europe's national regulators and endorses agreed safety objectives for nuclear power plants, in accordance with the recommendations of the Western European Nuclear Regulators' Association (WENRA)." Controversial proposals to develop harmonised safety guidelines and an EU-wide licensing process did not make the final text.

Member states will submit a first report to the Commission on the implementation of this directive by July 2017, and then another by July 2020.

A less controversial directive on waste management was adopted in July 2011. This requires member states to develop national programs detailing where and how they will construct and manage final repositories. The first report on the implementation of this directive is to be submitted in August 2015, then every three years thereafter.

Two associations of regulators are important – WENRA and ENSREG – and they became more significant after the Fukushima accident.

The Western European Nuclear Regulators' Association (WENRA) is a network of chief regulators of EU countries with nuclear power plants and Switzerland, with membership from 17 countries. Other interested European countries have observer status. It was formed in 1999 and has played a major role in coordinating safety standards across Europe including significant involvement in Eastern Europe. It is seeking increasing engagement with regulators in Armenia, Ukraine and Russia.

In Europe, six national agencies from the EU have combined to form a group to assist Eastern European countries with radioactive waste management.

The European Nuclear Safety Regulators Group (ENSREG) is an independent, authoritative expert body created in 2007 by the European Commission to revive the EU nuclear safety directive, which was passed in June 2009. It comprises senior officials from the national nuclear safety, radioactive waste safety and radiation protection regulatory authorities from all EU member states, and representatives of the European Commission. Its role is to help to establish the conditions for continuous improvement and to reach a common understanding in the areas of nuclear safety and radioactive waste management. It continues to make recommendations to and through the European Commission.

The national progress reports on European stress tests in 2011 are published by ENSREG.

Early in 2010 four national technical safety organizations set up a European Nuclear Safety Training and Tutoring Institute (ENSTTI) to help strengthen European research and assessment in the fields of nuclear safety and radiation protection. The institute is a joint initiative of France's Institut de Radioprotection et de Sûreté Nucléaire (Institute for Radiological Protection and Nuclear Safety, IRSN); Germany's Gesellschaft für Anlagen- und Reaktorsicherheit (GRS); the Nuclear Research Institute Rez (UJV) of the Czech Republic; and the Lithuanian Energy Institute (LEI).

The European Bank for Reconstruction and Development (EBRD) was founded in 1991 to be an international development bank for former communist countries, though its remit was extended to Turkey in 2009 and some MENA countries in 2012. It administers three funds for nuclear safety on behalf of the G24 countries and the EU for which €1.5 billion has been pledged: the Nuclear Safety Account (NSA); the International Decommissioning Support Funds (IDSFs) for Bulgaria, Lithuania and the Slovak Republic; and the Chernobyl Shelter Fund (CSF). The EBRD provides technical, financial, legal and administrative services.

At their Munich Summit in July 1992, the G7 countries initiated a multilateral program of action to improve nuclear power plant safety in Eastern Europe, including some countries which have since joined the EU. In February 1993 the G7 officially proposed that the EBRD set up a Nuclear Safety Account, to receive contributions by donor countries to be used for grants for safety projects. The first four projects financed safety upgrades for Bulgaria's Kozloduy plant, Lithuania's Ignalina plant, Russia's Leningrad, Novovoronezh and Kola plants and for Chernobyl in Ukraine. However, the continuing concerns following the Chernobyl accident over two types of Russian nuclear power reactors in Eastern Europe led to the EU requiring that these be shut down as part of EU accession negotiations with the countries hosting them. Eight reactors were involved over 2002-09: six VVER-440/V-213 models in Bulgaria and Slovakia, and two RBMK reactors in Lithuania. See also: Early Soviet Reactors & EU Accession paper.

In November 2013 the European Parliament backed a €631 million program over 2014-20 to support nuclear safety in countries aspiring to join the EU, or in neighbouring EU countries. This continues from a similar 2007-13 program.

The Nuclear Safety Assistance Coordination Centre database lists Western aid totalling almost US$1 billion to more than 700 safety-related projects in former Eastern Bloc countries.

The EU also supports nuclear safety through various agencies and programmes such the TACIS (CIS states) and PHARE (East Europe including the Baltic states) programs and various funds. In addition, the European Investment Bank (EIB), the financing arm of the EU, administers a US $1.4 billion long-term loan facility for Euratom to fund nuclear safety projects in eastern Europe, in particular those related to later-model VVER reactors. Further funding comes from the European Commission’s Directorate General for Transport and Energy which also has a direct responsibility for nuclear safety.

Uranium supplies for the EU

Euratom reported that in 2014, 14,751 tonnes of uranium was delivered to EU-28 utilities, representing 26% of world supply from mines. Nearly all of this was under long-term contracts. In addition, MOX fuel containing 11.6 t of fissile plutonium was used, representing a saving of 1156 tonnes of natural uranium and 0.8 million SWU.

The main sources of 2014 uranium deliveries were: Kazakhstan 27%, Canada 17%, Russia 18%, Niger 15% and Australia 13.5%. The 2013 average price for deliveries under long-term contracts was €78.31/kgU, 8% lower than in 2013. However, new contracts were being written at average €93.68/kgU, 10.65% higher than 2013. Long-term contracts covered 96.5% of 2014 deliveries. In 2014 enrichment was supplied by: EU (Areva and Urenco) 6.9 million SWU, Russia (Tenex) 3.2 million SWU, and others 2.4 million SWU.

In 2013 inventories had grown to 54,526 tonnes of natural uranium equivalent, about three years' requirements, but in 2014 they decreased 3% to 52,898 tU. Projections by utilities for Euratom suggest that this will diminish to about 2025.

Euratom reported that in 2014, 2165 tU of fresh fuel was loaded into commercial reactors in the EU-28. It was produced using 15,355 tU of natural uranium and 582 tU of reprocessed uranium as feed, enriched with 11.4 million SWU. In 2014, the fuel loaded into EU reactors had an average enrichment assay of 3.85% and an average tails assay of 0.24%.

Main References:
New Nuclear in Europe – 2030 outlook, World Nuclear Association, ISBN 9780955078484 (July 2014)
Development And Integration Of Renewable Energy: Lessons Learned From Germany, FAA Financial Advisory AG (Finadvice), July 2014
Euratom Supply Agency Annual Reports
Fraunhofer IWES, The European Power System in 2030: Flexibility Challenges and Integration Benefits – An Analysis with a Focus on the Pentalateral Energy Forum Region (June 2015). Analysis on behalf of Agora Energiewende
Technical And Economic Analysis Of The European Electricity System With 60% RES, Alain Burtin, Vera Silva, EDF Research and Development Division (June 2015)
Security alert: Europe needs more grids, more power plants, Energy Post (17 November 2015)

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