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EU Commission orders France to set renewable energy targets despite existing nuclear power capacity

Energy / By

In a move aimed at reinforcing the European Union’s commitment to combating climate change, the European Commission has urged France to establish more ambitious renewable energy targets. This decision comes despite France’s substantial reliance on nuclear power, which already significantly reduces its carbon footprint.

The European Commission’s directive, part of the broader EU Green Deal, calls on all member states to ramp up their use of renewable energy sources such as wind, solar, and biomass. The goal is to ensure that the EU collectively achieves its ambitious climate targets, including a 55% reduction in greenhouse gas emissions by 2030 and carbon neutrality by 2050.

France, known for its extensive nuclear energy infrastructure, has one of the lowest per capita carbon footprints in the EU. Nuclear power accounts for approximately 70% of France’s electricity generation, effectively minimizing CO2 emissions from its energy sector. Despite this, the EU Commission insists that the adoption of more renewable energy sources is essential for several reasons.

Sustainability

The Commission argues that relying too heavily on a single energy source, even one as low-carbon as nuclear, poses risks. Diversifying energy sources enhances energy security and resilience against potential disruptions. Investing in renewable energy technology can spur innovation and economic growth. The renewable energy sector has the potential to create jobs, attract investments, and position the EU as a leader in green technology. Although nuclear energy is low in carbon emissions, it presents other environmental challenges, such as radioactive waste management and the risks associated with nuclear accidents. Renewables, on the other hand, offer a more sustainable and environmentally friendly long-term solution. The EU’s climate strategy is based on collective action. Every member state is expected to contribute to the shared targets, and the Commission believes that France’s enhanced participation in renewable energy development is crucial for the overall success of the EU’s climate goals.

Energy expert Mark Nelson commented on the directive, highlighting the paradox in the EU’s approach. He said, “It’s funny, because in France, nuclear is already built, doesn’t save money if forced to turn down because the weather’s good that moment for highly-subsidized renewables, and is literally much more sustainable than building new renewables (2.5g CO2/kWh vs 10-50+ g CO2/kWh).”

Isabelle Boemeke, a nuclear power influencer, argued against the renewable energy targets, stating, “Few things are dumber than renewable energy targets, especially for countries that have lots of nuclear energy. Why? Because nuclear, while clean, isn’t considered renewable. Let’s imagine a country, where 90% of the energy is clean and comes from nuclear. Now imagine they decide to set a target of getting 40% of their energy from renewables. They’d have to close a few nuclear power plants and replace them with renewables just to hit some arbitrary goal. And what’s more ridiculous? It wouldn’t even lower the country’s emissions, but probably increase it. France wanted to provide a ‘low-carbon’ energy target of 58%, which would combine both renewable and nuclear. The European Commission was like ‘no, no, you have to make up a totally arbitrary and useless renewable energy target, because… reasons.’ Clean energy is clean energy, let’s stop with the renewables nonsense.”

An alternative approach

In contrast to the EU’s appraoch, members of the “Climate & Freedom International Coalition” an international network of thinkers and academics, have proposed an alternative direction of policy. They suggest replacing the current Paris Agreement with a new international treaty offering trade benefits to countries adopting climate-friendly free-market policies. These policies would include targeted tax cuts, known as “Clean Tax Cuts,” aimed at the four sectors responsible for 80% of greenhouse gas emissions: transport, energy and electricity, industry, and real estate. Additionally, they advocate for tax cuts aimed at breaking up monopolies and scrapping profit taxes for investors purchasing monopolistic and state-owned enterprises, thereby encouraging energy market liberalization among treaty parties.

Another suggestion involves incentivizing entrepreneurs and financiers in treaty-signing states through tax-exempt “CoVictory bonds” to invest in property, plant, and equipment (PP&E). These assets are crucial for long-term company operations. The goal is to lower borrowing costs by at least 30%, encouraging more innovation and driving investments in cleaner technologies. By making private debt a tool for reducing greenhouse gas emissions, the Coalition envisions that entrepreneurs and financiers could raise internationally reciprocal, private tax-exempt CoVictory Bonds, Loans, and Savings Funds to finance PP&E in any Accord nation. Tax-free interest would reduce debt costs by 30% or more, promoting investment in newer, cleaner technologies and unlocking cross-border capital flows.

An analysis of this perspective highlights the benefits of such an approach:

“Accord nations would gain access to vast tax-advantaged international capital flows for investment and development, via a new kind of internationally reciprocal leveraged supply side tax cut designed to accelerate innovation, growth, decarbonization, and the expansion of free markets. Any kind of private debt used to finance PP&E or conservation investments would be tax exempt in all Accord nations, meaning no tax on interest. That reduces the cost of debt perhaps 30%.

In every Accord nation, developers, entrepreneurs, banks, hedge funds, mutual funds, and financiers could raise tax-exempt debt – let’s call these CoVictory bonds, loans, even savings accounts – then pool the funds and reinvest them in any Accord nation in private PP&E or conservation projects. CoVictory Funds would accelerate private capital flows between free nations, to finance conservation and ever-cleaner development projects, providing a strong incentive to join a free market framework.

These tax-exempt CoVictory funds would have the same kind of tech-neutral, decarbonizing benefits as capital expensing. They lower the cost of capital for PP&E, accelerating the transition to the newest, cleanest technologies without picking winners or losers. CoVictory Funds make clean technologies cheaper and increase the return on equity, attracting investment not only to the tax-exempt debt but also to the taxable equity.

CoVictory funds have the added benefit of being internationalizable, useful for driving international capital flows through inclusive investment opportunities for everyone, from billionaires to anyone with a bank account. By contrast, traditional tax equity subsidies, like those in the US IRA, create trade barriers and benefit the largest investors the most, often excluding smaller entrepreneurs and thus holding back innovation. Picking winners and losers means, actually, you pick a lot of losers.

Without favoring some over others, CoVictory Funds could be used as a new kind of easy-to-use, highly democratic, and inclusive international incentive to expand free markets. They could replace the CBAM with an engine of global growth and innovative decarbonization, strengthen energy security ties between nations of the free world, and help rebuild the war-shattered infrastructure of Ukraine, Israel, or Gaza.”

The debate continues

France has historically defended its nuclear energy program, highlighting its role in providing a stable, low-carbon energy supply. The French government acknowledges the importance of renewable energy but has emphasized the challenges of transitioning from a predominantly nuclear energy system to one that incorporates a higher proportion of renewables.

French officials have expressed concerns about the financial and infrastructural implications of the Commission’s directive. Upgrading the national grid, ensuring the reliability of intermittent renewable sources, and securing funding for new projects are significant hurdles that France must overcome.

The European Commission has indicated its willingness to collaborate with France to address these challenges. Support measures, including financial aid and technical assistance, are expected to be part of the implementation strategy to help France meet the new renewable energy targets.

As the debate continues, the Commission’s directive underscores the EU’s commitment to a comprehensive and diversified approach to achieving a sustainable and carbon-neutral future. France’s response and subsequent actions will be closely watched as an indicator of how traditional energy systems can adapt to the evolving demands of climate policy.

The success of this initiative will hinge on the ability of France and the EU to balance the immediate benefits of nuclear power with the long-term advantages of a diversified and renewable energy portfolio. The collaboration between national governments and the EU will be crucial in navigating this complex transition while maintaining energy security and economic stability.

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