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State Aid for New Nuclear Power Plants under the Plethora of EU Environmental Regulations journal article

Sebastian J Kasper

European State Aid Law Quarterly, Volume 21 (2022), Issue 3, Page 251 - 265

Climate change has become one of the critical matters of European Union (EU) Law. Hence, the EU Member States are about to transform their respective energy supplies from mainly fossil fuels to climate-neutral sources. This transformation process requires time, as the security of energy supply must be ensured (see Article 194(1)(b) of the Treaty on the Functioning of the European Union). An approach favoured mainly by France and argued by several parties across Europe is to rely heavily on nuclear power and to invest in (new) nuclear reactors until 2050. Against this background, the question arises whether the EU Member States can support the transformation process by granting State aid for nuclear power plants despite the commonly known risks. Since the European Commission’s recently published Guidelines on State aid for climate, environmental protection and energy 2022 exclude nuclear energy from its scope, a broader review of the European Treaties, including the Euratom Treaty, as well as secondary and tertiary instruments, must be conducted to answer this question. Considering that nuclear energy has, following the Joint Research Centre’s risk assessment, recently been included in the Taxonomy Regulation for a transitionary period, granting State aid for nuclear reactors is likely to be still compatible with EU law upon the European Commission’s discretion, but not for long. Keywords: nuclear power; Taxonomy Regulation; Hinkley Point C; environmental protection; Euratom Treaty

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