Green taxonomy: EDF relativizes the scope of the vote for the future of nuclear power
MEPs will vote Wednesday (July 6), at noon, on the introduction of nuclear and gas into the green taxonomy. A vote whose scope is put into perspective by EDF officials who confided in EURACTIV.
On June 14, in the Environment (ENVI) and Economic Affairs (ECON) parliamentary committees, MEPs voted an objection against the integration of these two controversial sectors in the taxonomy on sustainable finance of the European Union.
A strong political signal, but which is not binding as it stands.
Thus, at first glance, the reflection on the integration of nuclear energy into the taxonomy is “as much a question of ‘premium’ on the financial level as of display on the political level” say EDF officials interviewed by EURACTIV.
“Very negative political signal” in case of non-integration in the taxonomy
Firstly, on the political level, the non-integration of nuclear energy would not bring about the end of atomic energy in Europe. However, the signal would be ” not at all good news for the sector, […] in the midst of a revival” admit EDF officials, who see it as a “a very negative political signal for the nuclear sector”.
In November 2021, the President of the Republic also announced the launch of new nuclear reactor sites.
Then, on the financial level, the non-integration of nuclear power into the taxonomy is “difficult tomeasure » they confide.
But for the moment, “the first purely qualitative feedback from financial institutions does not identify differentiated rates for activities depending on whether or not they are in the taxonomy”.
EDF, like other energy companies, nevertheless assumes “there will be differences”. Consequently, the French giant pleads for the integration of nuclear in the taxonomy in order to facilitate its access to markets.
Indicative Green Bonds “market appetite”
Among other advantages, this “should induce preferential rates on the collective debt with financial partners” they analyze.
Above all, this would make it possible to subscribe to green bonds on nuclear power “which should be significantly oversubscribed”. However, subscriptions greater than the volume put up for subscription are a good indicator of “market appetite” they claim.
However, whatever the fate reserved for nuclear and gas, private investors are increasingly turning away from construction sites for gas and nuclear power plants, according to Thierry Bros, professor at Sciences Po Paris and adviser for the World Energy Council contacted by EURACTIV.
Conversely, EDF officials confirm that tests with the financial markets show that a certain number of players, particularly French and British, could consider subscribing to green financial products with nuclear.
Nonetheless, they ” not [s’attendent] not that a non-green bond is a guaranteed failure”.
In other words, whether or not nuclear is included in the taxonomy should not be a harmful financial indicator to the point of ” the death of nuclear ».
“We don’t think a lot of companies are thinking today that their survival is correlated with whether or not their business is included in the taxonomy,” they advance.
Furthermore, they recall that the taxonomy concerns only private investments. Thereby, ‘sWith regard to nuclear power, there will be a mix between EDF’s own financing, perhaps recourse to private players, and a contribution from public funds. »
Review the organization of electricity markets
In addition, EDF officials note that maintaining nuclear power would lower electricity prices in the long term.
“What makes it possible to decorrelate electricity prices from the price of gas is to get out of fossil fuels as quickly as possible. [En somme]the more renewable and […] of nuclear power, the more likely we are to have this decorrelation”.
On the other hand, for this, “we must add long-term financing mechanisms to existing markets” and therefore review “organization of electricity markets” they assure.
Versus “a certain dogma that is very entrenched”, they thus welcome the positions taken by the President of the European Commission during a question and answer session at the European Parliament on June 8, 2022.
Ursula von der Leyen acknowledged in this case that electricity prices should be decorrelated from production capacity “marginal” available in gas-fired power plants to reduce “the ripple effect” on electricity prices. State of fact that the Italian, Portuguese and Greek leaders called for overcoming as early as March.
Must S’ “adapt to the new realities of dominant renewable energies”, with a “gigantic reform” she asserted, the first milestones of which could take shape with “legislative proposals from 2023”, advance our sources at EDF.
“We are going to be able to have a slightly more open discussion on topics such as credit regulation and capacity markets, which was a complete no go a year ago”they say.
Finally, one of the leaders appeals to those who have a “truncated and biased vision” : the delegated act does not support the Russian regime. On the contrary “the delegated act means energy independence” he says.
A position also shared by Agnès Pannier-Runacher, Minister for Energy Transition, in a column published on July 4 in the columns of the daily Les Echos, co-signed by the Bulgarian, Croatian, Finnish and Hungarian Ministers of the Environment and Energy , Polish, Czech, Romanian, Slovak and Slovenian.
In letter addressed yesterday (July 5) to a number of MEPs, the Ukrainian Ministry of Energy also called for “consider positively” the introduction of gas and nuclear into the taxonomy.
Kyiv has a capacity of ” indigenous gas production » and recognizes that ” nuclear energy will continue to make a significant contribution to energy security » from Europe.
Complement renewable energies
The debate on nuclear power also concerns its ability to decarbonize the energy mix.
“It is certain that a vote against the delegated act would be a negative signal for part of the carbon-free electricity which must take over to complement renewables and have volumes available for electrification and hydrogen production” EDF officials say.
Especially since the need for volumes of electricity from nuclear power to decarbonize the economy should double by 2050, estimates the International Energy Agency in a report published on June 30.
Gold, if the text is rejected, the services of EDF see badly “how the European Commission will find a fairly quick compromise with regard to its carbon ambitions”.
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