When the European Commission presented the Taxonomy Complementary Climate Delegated Act on climate change mitigation and adaptation, which has been in force since 1 January 2023, it provoked a strong reaction. This is because, amongst other things, it provides for certain nuclear power activities to be classed as sustainable within the meaning of the EU Taxonomy. Particularly contentious is the assessment of whether and to what extent these activities cause considerable damage to the environment – most notably in terms of waste disposal and final storage – because the “do no significant harm” principle is embedded in the Taxonomy and is thus an integral part of the EU’s sustainability approach. However, virtually no sound scientific analyses have been produced on the long-term impact of disposing of highly radioactive waste.

EU Taxonomy: objectives and areas of activity

The overarching aim of the EU Taxonomy is to create enough transparency on the capital market to steer private investments, which will be needed in order to achieve climate neutrality by 2050, in the right direction and thus facilitate the decarbonisation that is required. The EU Taxonomy distinguishes between several kinds of activity. These include what it terms transitional activities, i.e. “activities that cannot yet be replaced by technologically and economically feasible low-carbon alternatives, but do contribute to climate change mitigation and with the potential to play a major role in the transition to a climate-neutral economy, in line with EU climate goals and commitments, and subject to strict conditions, without crowding out investment in renewables.” (source: European Commission)

This term “transitional activities” now also includes certain nuclear power applications, although these must meet specific criteria in order to qualify as Taxonomy-aligned. First and foremost, facilities must comply with the Euratom Treaty and thus meet the highest safety standards (currently “Generation III+” reactors) and have a strategy in place for final storage from 2050 onwards at the latest.

The corresponding EU regulation covers the construction and operation of new nuclear power plants (for producing electricity and heat) as well as generating electricity from nuclear energy in existing ones – mainly renovation projects involving adapting the plants in line with modern technologies.

The criteria set out for nuclear power activities to be deemed sustainable as defined by the EU include:

• The nuclear power activities concerned must contribute to the transition to climate neutrality.

• They must meet nuclear and environmental safety requirements.

• Technical evaluation criteria are designed to ensure that no significant damage is caused to the environment:

• Producers of radioactive waste must pay for its disposal (setting up funds for disposing of radioactive waste and shutting down nuclear facilities).

• Operational repositories (near-surface for low- to intermediate-level waste; deep geological repositories for high-level waste and spent fuel elements by 2050) must be in place to prevent radioactive waste being exported for disposal in third countries.

• The regulation stipulates detailed technical assessment criteriathat are regularly reviewed and adapted in line with the latest developments in technology.

Specific disclosure obligations were also introduced as part of this expansion of the Taxonomy Regulation. These mean that financial and non-financial companies are now required to disclose how much they have invested in gas and nuclear activities so that an extremely high level of transparency can be ensured and investors can make informed investment decisions.

Magdalena Quell
Product and Project Manager at Raiffeisen KAG