Scene set for nuclear power row as EU rules on state aid due soon
EUROPEAN Union rules to be published in the coming weeks, could make it easier to justify using taxpayers' money to fund nuclear power, pitching major EU powers against each other.
The European Commission (EC), the EU's executive, says its mind is still open on the topic, but it is under pressure to set a legal framework for state aid to nuclear projects after several member states, including Britain, sought its guidance.
Whatever it lays down, as part of wider modernisation rules, is likely to widen a rift between anti-nuclear nations, like Germany and Austria, and those in support of the technology, such as Britain and the Czech Republic.
An EC spokesman said the executive was not planning to encourage nuclear state aid, but lawyers said a leaked draft of its proposal last month indicated it was leaning towards allowing nuclear financing.
"Each notification by a member state would, of course, still be subject to a case-by-case analysis by the European Commission," said a spokesman for the EC's competition directorate, which leads on state aid.
Lawyers say the EC does have the ultimate say on the issue, but the process of issuing guidelines and carrying out a consultation could legitimise nuclear state aid for new builds, rather than solely for short-term emergency funding, as has happened in the past.
The guidelines on energy and environmental aid for 2014-2020 are expected to be published around the end of September, after elections in Germany that are scheduled for September 22.
Following consultation with member states, they would need to be approved by the EU Commissioners meeting as a body, which is not expected until next year.
"There is still a long way to go before the European Commission recognises nuclear alongside renewables as one of the essential energy solutions to climate change," a spokesman for the World Nuclear Association said.
Opponents of nuclear power, including environmental groups, say government funding for atomic power would be a breach of EU legal principles and would mark a major shift in policy.
Under EU law, state aid is designed to address problems the market cannot solve, and must not cause unfair competition. It is in principle reserved for technology in its infancy, such as renewable energy. Nuclear generation began more than half a century ago.
Critics say giving state aid to nuclear projects, and specifically to the handful of firms building atomic plants in Europe such as France's EDF or Japan's Hitachi, creates a market distortion and puts other energy sources at a disadvantage.
"It is pure hypocrisy," said Claude Turmes, member of the European Parliament representing the Greens.
Other forms of subsidy have attracted fierce criticism, such as funding for renewable power in Germany, where the public cost of its shift from nuclear to wind and solar generation after the Fukushima crisis in Japan has provoked heated debate.
Countries keen to attract nuclear investment have found developers unwilling to build nuclear plants without state guarantees on prices for power generated.
New plants in Finland and France are billions of euro over budget and years behind schedule, and regulatory changes since the Fukushima accident have further inflated costs. (Reuters)