Communication from the Commission to the Council and the European Parliament - Nuclear Illustrative Programme {SEC(2007) 1261} {SEC(2007) 1262}
Date: 2007-10-04
Institutions: European Commission
Subjects: EAEC Treaty, EU Member State, EU investment, energy policy, energy supply, environmental protection, nuclear energy, nuclear power station, nuclear safety

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 4.10.2007 
COM(2007) 565 final 

COMMUNICATION FROM THE COMMISSION 
TO THE COUNCIL AND THE EUROPEAN PARLIAMENT 

Nuclear Illustrative Programme 

{SEC(2007) 1261} 
{SEC(2007) 1262} 

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TABLE OF CONTENTS 

Introduction .................................................................................................................. 3 

The global energy market............................................................................................. 3 

Market drivers .............................................................................................................. 3 

Global prospects and the EU-27 market ...................................................................... 4 

The Green Paper on a European strategy for sustainable, competitive and secure 
energy and the role of nuclear energy .......................................................................... 5 

EU investment in the nuclear domain .......................................................................... 5 

Nuclear power plants, worldwide and in the EU ......................................................... 5 

Investment notifications ............................................................................................... 6 

Development and investment prospects....................................................................... 7 

The impact of nuclear energy on security of supply, competitiveness and 
environmental protection ........................................................................................... 10 

The role of nuclear energy in security of supply........................................................ 10 

Nuclear power and competitiveness........................................................................... 11 

Economic aspects of nuclear power plants ................................................................ 13 

Nuclear power and climate change ............................................................................ 15 

Conditions for acceptability of nuclear power ........................................................... 16 

Public acceptance ....................................................................................................... 16 

Nuclear safety............................................................................................................. 17 

Disposal of radioactive waste..................................................................................... 18 

Decommissioning....................................................................................................... 19 

Radiological protection .............................................................................................. 19 

Action at EU level...................................................................................................... 20 

The regulatory framework (Euratom Treaty)............................................................. 20 

Commission proposals on nuclear safety................................................................... 21 

European programme for critical infrastructure protection ....................................... 21 

Euratom research........................................................................................................ 22 

The way forward ........................................................................................................ 22 

Conclusions ................................................................................................................ 23 

1. 

2. 

2.1. 

2.2. 

2.3. 

3. 

3.1. 

3.2. 

3.3. 

4. 

4.1. 

4.2. 

4.3. 

4.4. 

5. 

5.1. 

5.2. 

5.3. 

5.4. 

5.5. 

6. 

6.1. 

6.2. 

6.3. 

6.4. 

6.5. 

7. 

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1. 

INTRODUCTION 

Title  Two,  Chapter  IV,  Article  40  of  the  Euratom  Treaty  states  that  the  Commission  shall 
“periodically  publish  illustrative  programmes  indicating  in  particular  nuclear  energy 
production targets and all the types of investment required for their attainment.” Since 1958 
four such illustrative programmes and one update have been published1. 

This Nuclear Illustrative Programme describes the current status and potential future scenarios 
for  the  nuclear  sector  in  the  EU,  within  a  broader  energy  strategy.  It  provides  a  basis  for 
discussing  the  nuclear  option  in  the  context  of  the  ongoing  EU  energy  policy  debate.  The 
basis  for  a  European  energy  policy  was  set  out  by  the  European  Commission  in  the  recent 
Green  Paper2  and  in  the  Strategic  Energy  Review3.  In  this  context,  the  Nuclear  Illustrative 
Programme also aims at providing a factual analysis of the role of nuclear energy in meeting 
the  growing  concerns  about  security  of  energy  supply  and  CO2  emission  reductions,  while 
ensuring  that  nuclear  safety  and  security  are  paramount  in  the  decision-making  process. 
Independent  of  the  energy  policy  choices  made  by  Member  States,  consistent  action  in  the 
field of nuclear safety, decommissioning and waste management is necessary. 

Nuclear power stations currently generate approximately one third of the electricity and 15% 
of the energy consumed in the European Union (EU)4. Nuclear power is currently one of the 
largest sources of carbon dioxide (CO2) free production of energy in the European Union. 

2. 

THE GLOBAL ENERGY MARKET 

2.1.  Market drivers 

World energy demand is expected to rise by 60% by 2030. Oil consumption, for example, has 
increased by 24% over the last 10 years, with global demand projected to grow by 1.6% per 
year5. 

The EU's dependence on imports is increasing. Based on current trends, in the next 20 to 30 
years, around 65% of the Union’s energy requirements, up from 50% today, will be met by 
imports,  some  from  regions  that  raise  concerns  about  political  stability6.  Reserves  of  basic 
energy sources are concentrated in a few countries. Approximately half of the gas consumed 
in the EU comes from Russia, Norway and Algeria. On current trends, world gas consumption 
would increase by 92% over the next 25 years4. 

Oil  and  gas  prices  have  nearly  doubled  over  the  last  two  years,  with  electricity  prices 
following.  Despite  high  prices,  global  demand  for  energy  continues  to  rise.  In  2004,  global 
demand rose by 4.3%, mostly in the developing countries. China alone accounted for 75% of 
the additional demand for coal. Energy demand per head in Asia, Africa and South America is 
presently only a fraction of energy demand in the EU. However, the emerging economies of 

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In 1966, 1972, 1984, 1990 and lastly almost ten years ago in 1997. 
A European Strategy for Sustainable, Competitive and Secure Energy - COM(2006) 105, 8.3.2006. 
COM(2007) 1, 10.1.2007. 
Annex 1: See Figures 1 and 2 showing electricity and energy consumption in the EU. 
International Energy Agency (IEA): World Energy Outlook 2006. 
Annex 1: See Figure 3 showing forecast energy production and consumption. 

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China and India alone will certainly increase their demand for energy and have an impact on 
this balance in the near future. 

Within the EU, despite constant efforts to improve efficiency, energy demand has continued 
to  rise  by  0.8%  per  year.  The  latest  estimates  predict  an  annual  increase  in  EU  electricity 
demand  of  1.5%  on  a  business  as  usual  scenario.  As  a  result,  unless  action  is  taken  on  the 
basis of the Strategic Energy Review, greenhouse gas emissions could increase by a further 
5% by 2012, in  direct conflict with the Kyoto target of a reduction of 8% in the same time 
frame. 

Reliance  on  fossil  fuels  implies  increased  CO2  and  other  emissions  harmful  to  the 
environment. The world climate is getting warmer. According to the Intergovernmental Panel 
on Climate Change, greenhouse gas emissions have already made the world 0.6° C warmer7. 

2.2. 

Global prospects and the EU-27 market 

In 2005, the EU is the biggest nuclear electricity generator8 in the world (944.2 TWh(e)). It 
has a mature nuclear industry spanning the entire fuel cycle, with its own technological base 
and  expertise.  Attention  has  focused  on  the  safety  and  security  of  nuclear  installations  and 
protection  of  the  public.  The  recent  liberalisation  of  electricity  markets  has  significantly 
changed  the  investment  scenarios  compared  with  the  1970s  and  1980s  when  most  nuclear 
plants were constructed.  

The  Community  has  strengthened  its  international  relations  with  agreements  that  facilitate 
trade in nuclear materials and technology, instrumental to a policy of diversification of supply 
and closer cooperation on technology transfer and business with non-Community countries9. 
At the same time, the EU has continued to foster research and development on nuclear safety, 
reduction  and  treatment  of  radioactive  waste,  final  repositories  and  innovative  nuclear 
technology. In May 2006 Euratom became a full member of the Generation IV Forum (GIF), 
studying potential  future  reactor  designs that will make nuclear energy generation safer and 
more  economic,  improve  security,  reduce  non-proliferation  concerns  and  limit  waste 
generation. 

Established and emerging economies in Asia, such as Japan, South Korea, China and India, 
along  with  Russia  and  the  USA  are  planning  future  construction  of  nuclear  generation 
capacity,  ensuring  that  nuclear  power  plays  a  significant  role  in  meeting  their  increasing 
energy  requirements.  The  international  situation  calls  for  constant  attention  to  policies 
consistent  with  nuclear  developments  in  other  regions  of  the  world,  given  the  potential 
geopolitical implications for global security, health, industry and public opinion. 

In the EU, Finland, France and Bulgaria decided to construct new nuclear reactors. Other EU 
countries,  including  the  Netherlands,  Poland  (mutually  exclusive  option  from  its  expected 
collaboration  with  the  Baltic  States),  the  Czech  Republic,  Lithuania  (in  collaboration  with 
Estonia, Latvia and Poland), Slovakia, Slovenia and the United Kingdom along with Romania 
have  re-opened  the  debate  about  their  nuclear  power  policy,  which  could  lead  either  to 
extending the rating and operating life of existing plants or to debating their replacement or 

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www.IPCC.ch: Intergovernmental Panel on Climate Change – 2001 Report. 
IAEA (International Atomic Energy Agency) source, 2005. 
Agreements  have  been  concluded  with  Australia,  Canada,  the  USA  and,  more  recently,  with  Japan, 
Kazakhstan and Ukraine. 

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planning to build new installations. No political decisions on phasing out nuclear reactors or 
decision on new build in Sweden will be taken during the present Government's term of office 
(2006-2010).  Spain's  current  policy  is  a  progressive  reduction  of  its  participation  in  nuclear 
energy for power generation without compromising its security of electricity supply. Germany 
and Belgium are continuing their nuclear phase-out policies for the time being. 

2.3. 

The  Green  Paper  on  a  European  strategy  for  sustainable,  competitive  and 
secure energy and the role of nuclear energy 

The era of cheap energy is probably over, mainly due to strong world demand and insufficient 
investment in production, distribution and transmission capacity over the last few decades. In 
this context, the Strategic  Energy  Review and the 2006 Green Paper on secure, competitive 
and sustainable energy highlight the need for substantial investment over the next 20 years in 
the EU to replace ageing electricity generation capacity. They also call for a more sustainable, 
efficient and diverse energy mix. 

While each Member State and energy utility chooses its own energy mix, individual national 
decisions relating to nuclear energy can have an impact on other States in terms of trade flows 
of  electricity,  the  EU's  overall  dependence  on  imported  fossil  fuels  and  CO2  emissions  but 
also on competitiveness and the environment.  

The future of nuclear energy in the EU depends primarily on its economic merits, its capacity 
to deliver cost-efficient and reliable electricity to help meet the Lisbon goals, its contribution 
to  the  shared  energy  policy  objectives,  its  safety,  its  environmental  impact  and  its  social 
acceptability.  Nuclear  energy  generation  has  a  role  to  play  in  the  response  to  the  Strategic 
Energy  Review  and,  in  particular,  to  the  main  priorities  identified  in  the  Green  Paper10: 
security  of  supply,  competitiveness  and  sustainability.  At  the  same  time,  nuclear  safety, 
decommissioning  nuclear  reactors  at  the  end  of  their  active  life,  management,  transport  and 
final  disposal  of  radioactive  waste  together  with  non-proliferation  are  important  issues  that 
must continue to be actively addressed. 

3. 

EU INVESTMENT IN THE NUCLEAR DOMAIN 

3.1. 

Nuclear power plants, worldwide and in the EU 

Today 44311 commercial nuclear power reactors are operating in 31 countries worldwide, with 
total capacity of over 368 GWe. They supply 15% of the world's electricity. In addition, 56 
countries are operating a total of 284 research reactors for scientific purposes. A further 220 
nuclear  reactors  power  military  and  naval  vessels.  Globally,  28  nuclear  power  reactors  are 
under  construction,  with  another  35  firmly  planned,  equivalent  to  6%  and  10%  of  existing 
capacity respectively12. 

Few nuclear power plants have been built after the 1980s, but those operating are producing 
up to 20% more electricity due to power up-ratings and higher availability factors (i.e. shorter 

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12 

The Green Paper identifies six priorities: competitiveness and the internal energy market, diversification 
of  the  internal  energy  mix,  solidarity  in  the  Community,  sustainable  development,  innovation  and 
technology, and external policies. 
IEA World Energy Outlook 2006. 
Annex 1, Table 1 and Figure 4: List of reactors, electricity generation and uranium requirements. 

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stoppages for fuel re-loading and fewer incidents). From 1990 to 2004 world capacity rose by 
39 GWe (12%, due both to net addition of plants and up-rating of some existing installations) 
and  electricity  production  increased  by  718  billion  kWh  (38%).  Ageing  power  plants  are 
scheduled to be shut down in the next 10 to 20 years, which will reduce nuclear energy's share 
of  total  electricity  generation13.  The  International  Energy  Agency  in  its  2006  World  Energy 
Outlook's  reference  scenario  –  i.e.  if  present  policies  continue  unchanged  –  shows  that  the 
nuclear energy share will decline from the current 15% to below 8% by 2030. 

One  quarter  of  the  world's  reactors  have  load  factors14  of  more  than  90%,  and  almost  two 
thirds above 75%. These figures suggest near-maximum utilisation, given that most reactors 
have to shut down every 18 to 24 months for re-fuelling. 

In EU-2715 a total of 152 nuclear reactors are in operation in 15 Member States. The average 
age of nuclear power plants (NPPs) is approaching 25 years16. In France, which has the largest 
fleet  (59)  of  nuclear  reactors  accounting  for  nearly  80%  of  its  electricity  generation,  and 
Lithuania,  with  only  one  NPP  yet  accounting  for  70%,  the  average  age  is  around  20  years. 
The  UK  fleet  of  23  NPPs  has  an  average  age  approaching  30  years,  while  in  Germany  the 
average age of their fleet of 17 operational NPPs is 25 years.  

Since  nuclear  power  provides  one  third  of  Europe’s  electricity  and  the  typical  initial  design 
life  of  an  NPP  is  40  years,  decisions  are  required  on  extension  of  the  life  of  some  plants, 
where safely possible, or on new investment to meet expected demand and to replace ageing 
infrastructure over the next 20 years. Taking into account the current EU energy mix, if the 
planned phase-out policy in some EU Member States is maintained, without extending plant 
lifetime  and/or  new  construction,  nuclear  energy's  share  of  electricity  production  will  be 
significantly reduced. Considering that it typically takes ten years to construct a new NPP17, 
should the intention be to replace existing nuclear plants by new ones, decisions are required, 
even if it were merely to maintain nuclear energy's current share of electricity production.  

3.2. 

Investment notifications 

Under Article 41 of the Euratom Treaty, investment projects related to the nuclear fuel cycle 
in the EU must be notified to the Commission prior to conclusion of contracts with suppliers 
or, if the work is  to be carried  out  by the undertaking with its own resources,  three  months 
before the work begins. 

Since  1997  a  total  of  19  projects  have  been  notified  to  the  Commission.  Ten  were  for 
installations in France, seven of them on replacement of steam generators for NPPs, one on 
construction of a treatment and storage facility for radioactive waste (CEDRA) at Cadarache, 
one on construction of a new uranium enrichment plant (Georges Besse II) at Tricastin using 
centrifuge technology and the last on construction of a new EPR NPP at the Flamanville site. 

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17 

Annex 1: See Figure 5 for a comparison of two possible scenarios. 
“Load  factor” means  the  ratio  between  the average  load  and  the peak  load  over  a  specified  period of 
time. 
Annex 2: Country-by-country information on current nuclear fuel cycle activities. 
Annex 1: See Figures 6 and 7 showing NPPs by age and age distribution by country. 
The  Olkiluoto  NPP  project  in  Finland  was  submitted  in  2000  and  received  Government  approval  in 
2002  and  licensing  approval  in  2004.  Construction  started  in  2005.  Operation  is  expected  to  start  by 
2010. 

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In  2004  Finland  notified  the  Commission  of  its  plans  for  a  new  NPP  at  Olkiluoto,  the  first 
new NPP to be built in the EU for more than a decade. Upgrades and additional capacity at 
the  three  uranium  enrichment  plants  (Urenco)  in  Germany,  the  Netherlands  and  the  United 
Kingdom, construction of an installation for vitrified high-active waste (VEK) in Karlsruhe, 
Germany and replacement of steam generators at the Tihange NPP in Belgium complete the 
list. 

3.3. 

Development and investment prospects 

This  section  summarises  the  situation  in  the  various  countries  that  currently  use  nuclear 
energy. Further details are given in Annex II.  

In  mid-2004  Belgium  announced  a  new  national  energy  policy  study  on  plans  to  phase  out 
nuclear power up to 2030, with the first NPP closing in around 2015. Existing legislation calls 
for the closure of NPPs after 40 years of commercial operation, but exceptions can be made 
on the grounds of security of supply. In June 2006 the Federal Government decided on Dessel 
as the site for a surface disposal facility for low- and intermediate-level short-lived waste, to 
come into operation between 2015 and 2020. 

the  end  of  2006, 

In Bulgaria Kozloduy NPP Plc operated four out of its six nuclear reactors until the end of 
2006. Two units (Kozloduy 1 and 2) were shut down in 2002, followed by Kozloduy 3 and 4 
at 
the  accession  negotiations. 
Decommissioning of these units is being supported by EU funds. In order to make up for the 
closure  of  these  units  and  satisfy  the  increasing  electricity  requirements  in  the  region,  two 
additional units at the Belene site are at an advanced design stage. 

to  meet  commitments  given 

in 

In 2003 Ceske Energeticke Zavody (CEZ) which operates the Czech Republic’s two nuclear 
power stations -  Dukovany  and  Temelin - began an ambitious upgrade programme. Besides 
improving  competitiveness  and  safety,  the  aim  of  the  upgrade  is  to  extend  the  plants' 
operating licences from 30 to 40 years. Despite plans in 2005 to close the Czech Republic’s 
remaining  uranium  mine  (Dolni  Rozinka),  which  previously  had  significant  uranium 
production,  rising  uranium  prices  are  prompting  the  authorities  to  consider  extending  its 
operation. 

The construction licence for Finland’s fifth nuclear plant, a 1600 MWe European pressurised 
water  reactor  (EPR)  sited  at  Olkiluoto,  was  issued  to  Teollisuuden  Voima  Oy  (TVO)  in 
February 2005. Construction has already started, with operation originally planned to start in 
2009-10. According to TVO, due to construction delays, the start up is postponed until 2010-
11. The operating units Olkiluoto 1 and Olkiluoto 2 have been upgraded to 860 MW with an 
operating lifetime of 60 years. 

Posiva Oy is constructing an underground characterisation facility (Onkalo) in the bedrock of 
Olkiluoto to acquire the information needed for the construction licence application for a deep 
repository that will be submitted to the Finnish Government in 2012. The repository will not 
require monitoring after closure. The Government decided, however, that retrievability was a 
prerequisite. There are plans to expand the repositories for low- and intermediate-level waste 
at Olkiluoto and Loviisa - where radioactive waste is placed in caverns and silos excavated in 
underground rock near the power stations - so that they can take decommissioning waste. The 
estimated  costs  of  the  repository  and  other  waste  management  activities  are  included  in  the 
price of nuclear-generated electricity, collected from the generators and deposited in the State 
Nuclear Waste Management Fund. 

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Before  the  French  Government  put  together  its  energy  bill,  a  national  energy  debate  was 
started in 2003. The debate concluded that nuclear power should continue to play a key role in 
the  French  energy  mix.  Two  issues  considered  in  the  debate  were  the  need  to  replace  the 
existing  fleet  of  nuclear  power  plants,  starting  in  around  2020,  and  global  warming.  On  13 
July 2005 a framework law laying down energy policy guidelines was introduced, which was 
supplemented on 13 July 2006 by a law on transparency and security in nuclear matters. On 
28 June 2006, a law was also introduced on sustainable management of radioactive material 
waste,  which  establishes  the  rules  for  generating  and  controlling  the  funding  of  long-term 
costs.  The  new  legislation  not  only  keeps  the  nuclear  option  open,  but  also  includes 
commitments to reduce greenhouse gas emissions. Once this legislation had been passed, the 
Government agreed to a request from Electricité de France (EdF) to build an EPR, the second 
in the EU, which will come into operation in 2012. 

Germany  has  a  phasing-out  law  (“Atomausstiegsgesetz”),  corresponding  to  an  agreement 
between the Federal Government and the nuclear power generators on the total nuclear power 
to be produced. The operators also agreed to stop transfers of spent fuel for reprocessing from 
2005  onwards.  In  order  to  avoid  transport  to  the  interim  storage  installations  in  Gorleben, 
construction of on-site storage facilities was required at several plants. Two NPPs have closed 
- Stade in 2003 and Obrigheim in 2005 - leaving 17 units in operation. The permit to begin 
decommissioning  the  Mülheim-Kärlich  plant  was  issued  in  July  2004.  The  final  stage  of 
expansion of the Urenco enrichment plant in Gronau has been approved, and the licence has 
been granted for a capacity increase at the Advanced Nuclear Fuels fuel fabrication plant in 
Lingen. 

The  four  Paks  units  in  Hungary,  all  second-generation  VVER-440/213  reactors,  were 
supplied  by  Russia’s  Atomenergoexport.  A  subsequent  modernisation  programme  increased 
their  power  ratings.  In  the  last  five  years  extensive  work  has  been  done  to  prepare  for 
potential extension of their operating licences for another 20 years. Paks also plans to increase 
each unit’s electrical power by a further 8%. A Central Nuclear Financial Fund has been set 
up to finance waste management and decommissioning at the Paks site. Investigations to find 
a suitable location for a new repository for low- and intermediate-level waste identified a site 
at Bátaapáti. In 2005 the local community voted in favour of the project. 

Having agreed, as a condition for accession to the EU, to close down its two Russian-designed 
nuclear reactors at Ignalina, which were not considered economically upgradeable, Lithuania 
has  decided  to  remain  a  nuclear  country.  In  March  2006  a  Memorandum  of  Understanding 
was  signed  with  Estonia  and  Latvia  on  preparations  for  the  construction  of  a  new  nuclear 
reactor. As a result of a feasibility study, intended to promote activities in favour of energy 
security in the Baltic region, the Governments of the three Baltic States agreed, in principle, 
to construction of a new NPP in Lithuania. The Lithuanian Government is expected to adopt 
legislation in 2007 to accommodate that decision. 

The  Dutch  Government  and  Elektriciteits  Produktiemaatschappij  Zuid  (EPZ),  the  owner  of 
the Borssele plant, agreed another extension to its operating life. It will continue generating 
until 2033, provided the plant remains safe and economically viable. The Government intends 
to review the national laws and regulations to clarify the conditions under which new nuclear 
installations  could  be  built  in  the  future,  giving  special  consideration  to  the  issue  of 
radioactive waste and measures to prevent terrorist attacks. 

Romania  is  operating  one  nuclear  power  plant  (Cernavoda  1).  A  second  unit  is  under 
construction  and  should  become  operational  in  2007.  Preparatory  work  for  two  additional 

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units  will  start  in  2007.  The  plan  is  to  double  electricity  production  by  2008  and  to  have 
another two NPP units by2015. 

In  February  2005  the  Slovak  Minister  for  Economic  Affairs  authorised  the  sale  of  66%  of 
Slovenské Elektrárne, the country’s nuclear operator, to Italy’s Enel S.p.A. As a condition for 
accession to the EU, Slovakia agreed to close down two of its six Russian-designed reactors - 
Bohunice 1 and 2 - which were not considered economically upgradeable. 

Slovenia shares ownership of the Krsko nuclear power plant with Croatia. In 1990 uranium 
mining  activities  were  stopped  at  the  Zirovski  VRH  mine,  which  is  now  being 
decommissioned.  

In Spain, the present policy of the Government in relation to nuclear energy is the progressive 
reduction of its participation in the power generation, without compromising at any moment 
the  security  of  electricity  supply.  In  April  2006,  the  Jose  Cabrera  (Zorita)  plant  was 
definitively shut-down after 38 years of operation. This one was the smallest and the oldest 
nuclear power plant of the Spanish park. Dismantling the plant will be undertaken from 2009. 
The main strategy established in the VI General Plan for Radioactive Wastes, approved by the 
Government on 23 June 2006, is based on the availability of a centralised temporary storage 
facility by the year 2010. 

The  operators  of  Sweden’s  10  nuclear  power  reactors  have  all  announced  modernisation 
programmes,  which  in  some  cases  includes  power  uprating.  In  response  to  these  plans,  the 
safety authority has issued new regulations on retrofitting the ageing reactors to meet modern 
safety standards. The Swedish Nuclear Fuel and Waste Management Company (SKB) set up 
by the NPP operators expects to submit a permit application in 2006 for a waste encapsulation 
plant,  due  to  be  located  next  to  the  existing  interim  storage  facility  in  Oskarshamn.  A 
preliminary application for the encapsulation facility was submitted in late 2006 and the final 
application for the entire deep repository facility is scheduled to be submitted in 2009. 

On  1  April  2006  the  United  Kingdom’s  Nuclear  Decommissioning  Authority  (NDA)  took 
over  ownership  of  most  of  the  civil  nuclear  sites  and  responsibility  for  dealing  with  the 
country’s waste legacy. This included all the public-sector civil nuclear liabilities held by the 
UK Atomic Energy Authority (UKAEA) and most of those held by British Nuclear Fuels plc 
(BNFL),  together  with  BNFL's  related  assets.  The  UK  operates  a  total  of  39  reactors  and  5 
fuel reprocessing plants, plus other fuel cycle and research facilities on 20 sites, including the 
elderly Magnox reactors which should all be closed by 2010. 

When  the  NDA  came  into  existence,  BNFL  and  the  UKAEA  continued  to  operate  most  of 
their former facilities under contract to the NDA. The plan, however, is that this arrangement 
is to be only temporary. Starting in 2008, the NDA will put site management contracts out to 
tender,  with  BNFL  and  the  UKAEA  having  to  compete  against  other  companies,  including 
American undertakings, for the jobs. The UK energy review of July 2006 stated that nuclear 
energy has a role to play in the future UK mix for electricity generation alongside other low-
carbon generation options. 

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4. 

THE  IMPACT  OF  NUCLEAR  ENERGY  ON  SECURITY  OF  SUPPLY,  COMPETITIVENESS 
AND ENVIRONMENTAL PROTECTION 

This section analyses the role of nuclear energy in relation to the three main priorities of the 
2006 Green Paper, namely: security of energy supply, competitiveness against other forms of 
energy generation, and contribution to limiting greenhouse gas emissions.  

4.1. 

The role of nuclear energy in security of supply 

Before  liberalisation  of  the  energy  sector,  it  was  the  role  of  governments  to  take  energy 
security  into  account  when  planning  their  energy  systems,  by  trying  to  put  together  a 
diversified and secure portfolio of supply sources. Since legislation on liberalisation has been 
enacted, the role of governments has evolved towards creating the appropriate framework for 
competition. On liberalised markets, investment decisions are taken by investors and not by 
governments.  

Nuclear energy can contribute to diversification and long-term security of energy supply for 
the following reasons: 

–  The limited importance of the raw material – natural uranium - and its availability 

Nuclear  plants  are  largely  insensitive  to  changes  in  the  cost  of  fuel,  unlike  other  types  of 
generating  plants.  Nuclear  fuel,  including  uranium  mining,  enrichment  and  fuel  fabrication 
represents  approximately  10-15  %  of  the  total  cost  of  generating  electricity.  Furthermore, 
maintaining strategic stockpiles, covering several years of consumption, is easily manageable 
without placing a significant financial burden on users.  

No uranium shortages are foreseen in the near future. The rising uranium price has increased 
exploration  and  production  but  had  little  impact  on  nuclear  electricity  costs18.  Looking  ten 
years ahead, the market is expected to grow slightly without important impact to generation 
costs19. Reasonably assured and recoverable known uranium resources at competitive prices 
can sustain the requirements of the nuclear industry for at least the next 85 years20 at current 
levels of consumption. 

Primary production (new mining) of uranium has been lower than reactor requirements since 
1985.  Secondary  sources  (stocks,  recycled  fuel  and  down-blending  of  highly  enriched 
uranium  from  military  stockpiles)  have  made  up  for  any  shortfalls.  By  2020  secondary 
sources  are  expected  to  be  depleted.  Consequently,  more  exploration  is  required.  European 
companies, such as Areva, co-own mining facilities in Canada and Niger. Finland, Slovakia 
and Romania are investigating uranium mining. 

The Euratom Treaty requires that all users in the Community receive a regular and equitable 
supply of ores and nuclear fuels. It establishes a common supply policy based on the principle 
of  equal  access  to  sources  of  supply,  while  prohibiting  practices  designed  to  secure  a 
privileged position for certain users. Implementation of these provisions falls within the remit 

18 
19 

20 

“Uranium 2005: Resources, Production and Demand”, Nuclear Energy Agency. 
See Annex 1, figure 8 for impact on electricity generation for a 50% increase in price of fuel for various 
sources. 
“Forty  Years  of  Uranium  Resources  Production  and  Demand  in  Perspective  –  The  Red  Book 
Retrospective”, OECD, 2006. 

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of the Euratom Supply Agency (ESA)21. The ESA's mandate extends to ensuring that imports 
and exports to and from the Community are in line with EU policies on security of supply and 
that the interest of the users is protected. 

–  The geopolitical distribution of uranium resources, producers and suppliers 

The  geopolitical  distribution  of  uranium  resources  is  diverse22,  with  most  of  them  coming 
from politically stable regions of the world. Australia and Canada currently supply 45% of the 
EU uranium requirements.  

–  Production capabilities23 

The  various  steps  of  the  fuel  cycle  display  different  degrees  of  security  of  supply.  Some 
services, such as fabrication and transport, are provided by a wide range of suppliers, ensuring 
both security and competitive prices. For others, e.g. enrichment, the number of suppliers is 
more limited, yet more than 70% of EU-25's requirements are met by EU suppliers. 

The  international  safeguards  aiming  at  preventing  proliferation  of  nuclear  weapons  place 
specific constraints on nuclear fuel markets in the form of declaration, control and verification 
of peaceful use of nuclear materials. The framework created under the Euratom Treaty and the 
International Atomic Energy Agency (IAEA) provides a well-defined set of rules. Within this 
framework,  nuclear  materials  for  peaceful  uses  can  be  traded  freely  between  countries  and 
operators. 

4.2. 

Nuclear power and competitiveness 

Cost  and  investment  risk  are  important  issues  when  considering  construction  of  nuclear 
reactors.  Nowadays  a  new  nuclear  plant  involves  an  investment  in  the  range  of  €  2  to  3.5 
billion  (for  1000  MWe  to  1600  MWe  respectively).  Today,  given  the  Kyoto  targets,  public 
policy  has  sound  and  urgent  reasons  for  placing  a  sizeable  premium  on  clean  technologies. 
One key question is whether nuclear energy requires such policy intervention in order to be 
economically  competitive.  Investment  in  new  nuclear  facilities  requires  at  least  a  stable 
legislative  and  political  framework  given  the  time  lag  between  the  initial  investment  and 
sizeable returns. As liberalised markets cannot guarantee long-term stability of prices, the IEA 
indicates that for the private sector to invest in new nuclear projects, governments may need 
to take measures reducing investment risks. 

–  Nuclear electricity's competitiveness on the current energy market 

The total revenue and costs over the lifetime of an NPP should be compared with the return 
provided by alternative sources over the same period. However, predicting revenue and costs 
over  this  time  frame  is  very  difficult,  due  to  the  volatility  in  the  cost  of  oil  and  gas  and  of 
electricity prices. Given the lack of new plant construction in the EU and USA for more than 
a decade, no proven cost data are available yet for new generation NPPs. 

21 

22 
23 

The  Euratom  Treaty  gives  the  ESA  the  right  of  option  to  acquire  ores,  source  materials  and  special 
fissile materials produced in the Community and an exclusive right to conclude contracts for the supply 
of such materials from inside or outside the Community. In order to be valid, supply contracts must be 
submitted to the ESA for conclusion. 
Annex 1: See Figure 9. Geopolitical distribution of imported gas and uranium resources. 
Annex 1: See Figures 10.1 and 10.2. Availability of uranium resources. 

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Analysis  by  the  International  Energy  Agency  (IEA)24  and  the  Nuclear  Energy  Agency 
(NEA)25,  based  on  data  from  more  than  130  different  types  of  electricity-generating  plants, 
including coal, gas, nuclear, wind, solar and biomass, from experts in 19 OECD and 3 non-
OECD  countries,  indicates  that  in  most  industrialised  countries  new  nuclear  power  plants 
offer an economical way to generate base-load electricity with gas and coal prices at a certain 
level. The industry confirms this view26. According to the IEA and NEA, nuclear electricity is 
a  competitive  alternative,  with  costs  and  competitiveness  depending  on  the  project27.  The 
WNA report validates these findings and notes that the data were collected prior to the price 
increases for fossil fuels, which further reinforces the point.  

Nuclear  power  has  traditionally  shown  a  combination  of  higher  construction  and  lower 
operating  costs  than  fossil-fuel-based  energy  production,  which  exhibits  lower  capital  costs 
but higher and potentially fluctuating fuel and, hence, operating costs. 

–  The  economic  competitiveness  of  nuclear  power  depends  on  several  factors,  with 
construction  times,  capital  costs,  waste  disposal,  decommissioning  and  the  operational 
capacity factor playing a key role. 

–  Licensing procedures have been simplified. Although rigorous safety and quality standards 
are being and have to be maintained, predictable technical parameters and timescales, from 
design to certification through construction to  operation,  and lower regulatory costs have 
reduced overall financing costs. 

–  Operating  costs  have  fallen  steadily  over  the  last  20  years,  as  capacity  factors  have 
increased. The low marginal cost of nuclear power27 has encouraged nuclear plant owners 
to apply for extended operating licences. Although uranium prices have substantially risen 
since 2004, the impact on electricity costs has been relatively minor as the cost of uranium 
is only a small fraction (approximately 5%) of the total kWh cost. 

–  In  several  EU  countries  the  nuclear  industry  levies  electricity  surcharges  to  manage  and 
dispose  of  the  waste  generated  and  to  fund  decommissioning.  The  financial  management 
method and availability of the funds vary between Member States28. 

–  Generating utilities around the world are planning to extend reactor operating lifetimes29. 
Sweden  has  approved  10-year  extensions,  with  a  20-year  increase  possible,  provided 
nuclear safety norms are observed. 

–  The  spectacular  price  increases  in  other  fuels  have  also  added  to  the  economic 

competitiveness of nuclear power under these circumstances. 

24 
25 
26 

27 

28 
29 

International Energy Agency, World Energy Outlook 2006, p. 43. 
Projected Costs of Generating Electricity (2005) – Nuclear Energy Agency Study, March 2005. 
The  New  Economics  of  Nuclear  Power  –  World  Nuclear  Association,  December  2005: 
http://www.world-nuclear.org/economics.pdf. 
Annex  1:  See  Figure  11a  and  11b.  OECD  estimates  of  relative  competitiveness  of  electricity 
production. 
C(2006) 3672 final adopted on 24.10.2006. 
The  US  Nuclear  Regulatory  Commission  recently  granted  30  plants  a  20-year  extension,  effectively 
prolonging the lifetime of their reactors to 60 years. 

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The  IEA  concluded  its  2006  analysis30  by  saying  that  “new  nuclear  power  plants  could 
produce  electricity  at  a  cost  of  less  than  5  US  cents  per  kWh, if  construction  and  operating 
risks are appropriately managed by plant vendors and power companies. At this cost, nuclear 
power  would  be  cheaper  than  gas-based  electricity  if  gas  prices  are  above  $4.70  per  MBtu. 
Nuclear  power  would  still  be  more  expensive  than  conventional  coal-fired  plants  at  coal 
prices of less than $70 per tonne. The breakeven cost of nuclear power would be lower when 
CO2 prices are taken into account." 

–  Role of state aid 

New  nuclear  plants  are  generally  being  built  without  subsidies,  which  is  an  indication  that 
nuclear energy is increasingly perceived as competitive. This trend marks a change from past 
practice in a number of EU countries. In Finland, for instance, the new nuclear plant is being 
financed by private sources31. Similarly, the UK Government announced that it would be up 
to the private sector to initiate, fund, construct and operate new nuclear plants. 

4.3. 

Economic aspects of nuclear power plants 

Uncertainty  about  future  electricity  prices,  market  structure  and  conditions  and  about  future 
energy and climate change policies poses a major risk to long-term investment in the energy 
sector.  This  is  particularly  important  for  nuclear  energy,  due  to  the  high  capital  investment 
associated  with  construction  of  a  new  NPP  and  the  relatively  long  period  before  any  such 
investment  starts  to  show  a  profit.  It  is  therefore  important  to  try  to  establish  firm  policy 
frameworks so that the conditions are clear and predictable for new investments. 

Construction  of  the  new  NPP  in  Finland,  although  not  requiring  government  subsidies, 
depends  on  secure  long-term  investment,  which  will  be  achieved  by  shareholder  agreement 
ensuring a fixed energy price to the owners/investors, which are essentially shareholders from 
the paper industry.  

Another  key  issue  for  the  economic  future  of  nuclear  power  is  to  understand  how  its 
commercial  returns  relate  to  electricity  market  structures32.  Investors  prefer  shorter  payback 
periods,  making  investments  with  lower  construction  costs  and  a  short  lead  time  more 
attractive. Nuclear lead times (five years in the most optimistic scenario) are, for engineering 
and  licensing  reasons,  much  longer  than  for  combined  cycle  gas  turbines  (CCGT)  or 
renewable energy sources which have lead times of only two years or less. 

Construction  costs  for  nuclear  plant  are  two  to  four  times  greater  than  for  a  CCGT.  Of  the 
three  major  components  of  nuclear  generation  costs  –  capital,  fuel,  and  operation  and 
maintenance  –  the  capital  costs  account  for  approximately  60%  of  the  total,  compared  with 
only around 20% of the total costs for a CCGT. 

30 
31 

32 

World Energy Outlook, 2006, p. 43. 
The  procedure  for  clearing  the  investment  under  Articles  41-43  of  the  Euratom  Treaty  was  fulfilled 
properly and did not give rise to any objection. Regarding the export credit guarantee awarded for part 
of  the  project,  which  is  in  conformity  with  OECD  export  credit  rules,  the  Commission  has  opened  a 
procedure to determine whether this guarantee constitutes State aid within the meaning of Article 87(1) 
of the EC Treaty, and, if it does, whether the aid is compatible with the common market. This procedure 
is pending at the time of writing.  
International  Energy  Agency  (2005):  “Projected  costs  of  generating  electricity,  2005  update”,  OECD 
publication, Paris. 

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The economic risks of a nuclear power plant are linked to the major capital investment at the 
beginning and require quasi-faultless operation during the first 15 to 20 years of its 40-60 year 
lifetime  to  pay  back  the  initial  investment.  In  addition,  decommissioning  and  waste 
management mean that financial assets must be made available for 50 to 100 years after the 
shutdown of the reactor. 

The lack of recent experience with new construction makes it difficult to estimate the precise 
costs  for  the  latest  generation  of  reactors.  In  the  past,  disputes  about  licensing,  local 
opposition  and  cooling  water  sources  have  delayed  construction  and  completion  of  nuclear 
plants  both  in  the  USA  and  Europe33.  As  the  same  factors  have  also  caused  delays  in  more 
recent energy system investments, for example in inter-connectors, similar delays are likely to 
occur in construction of new nuclear plants. 

The larger size of nuclear plants exposes investors to greater downstream risks, as for the next 
decade  only  large-scale  plants  (> 500 MW)  should  be  available.  On  liberalised  electricity 
markets, uncertainties about electricity prices encourage construction of small-scale modular 
units,  as  the  timing  of  entry  is  critical  to  the  returns  on  an  investment.  For  engineering 
reasons, economies of scale dominate nuclear  plants and reducing unit size does not appear 
economic with current technologies34. 

Certain  financial  and  environmental  risks  still  remain  with  governments  in  some  Member 
States, such as responsibility for the facilities for long-term waste disposal and management. 
Although  funds  may  be  accumulated  by  operators  during  the  plant's  operating  life,  and  as 
such  paid  for  by  the  private  sector  and  consumers,  gaps  may  still  exist  between  the  funds 
available  and  those  actually  required.  It  will  be  for  governments  and  generating  companies 
together to develop innovative mechanisms to tackle outstanding issues and future challenges. 
It remains crucial that sufficient savings are set aside to finance decommissioning and waste 
management. 

Building  a  large  number  of  reactors  with  similar  design  (fleet  approach)  has  potential 
advantages.  Hence,  it  could  also  be  attractive  for  private  investors  to  cooperate  in  order  to 
benefit  from  such  economies  of  scale.  Nuclear  suppliers  have  indicated  that  savings  on 
subsequent plants could be between 10% to 40% of the cost of the first plant, which provides 
a  significant  incentive  for  a  fleet  approach.  The  projected  savings  are  due  to  the  following 
factors, inter alia: 

–  First-of-a-kind (prototype) costs related to a new design.  

–  A fleet of plants of the same design allows the licensing costs to be spread. 

–  The  fleet  design  concept  would  allow  development  of  a  single  solution  on 

decommissioning. 

33 

34 

Ludwigson, J. et al. (2004): “Buying an option to build: regulatory uncertainty and the development of 
new electricity generation”, IAEE Newsletter, Second Quarter 2004, pp. 17-21. 
Gollier,  C.  et  al.  (2005)  “Choice  of  nuclear  power  investments  under  price  uncertainty:  valuing 
modularity”, Energy Economics 27(4): 667-685. The benefit of one large nuclear power plant project 
stemming  from  increasing  returns  to  scale  are  compared  with  the  benefit  of  a  sequence  of  smaller 
(300 MWe),  modular,  nuclear  power  units  on  the  same  site.  The  benefit  of  modularity  in  terms  of 
profitability is equivalent to a reduction of the cost of electricity by only one thousandth of a euro per 
kWh. 

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–  The  limited  number  of  professionals  could  be  used  more  efficiently,  avoiding  potential 

expertise bottlenecks. 

–  If  a  commitment  were  made  to  purchase  a  number  of  reactors,  more  favourable  turnkey 

contracts could be offered35. 

The fleet approach, however, is not devoid of commercial risk, for example if it were to prove 
necessary to redesign the plant as a result of an accident or other generic malfunction. 

4.4. 

Nuclear power and climate change  

The path forward on climate policy lies primarily in near-term emission reductions driven by 
the  targets  set  by  the  Kyoto  Protocol36.  Nuclear-generated  electricity  provides  large-scale, 
base-load supply to support energy-intensive industries and daily domestic requirements with 
limited  emissions.  Nuclear  power  plants  have  met  38%  of  the  increased  global  electricity 
demand  since  1973.  Assuming  that  otherwise  this  capacity  would  have  burnt  fossil  fuel, 
nuclear  energy  has  significantly  contributed  to  mitigating  emissions  of  CO2,  the  principal 
greenhouse  gas  (GHG)37.  Generation  of  one  million  kilowatt-hours  of  electricity  from  coal 
releases  230  metric  tonnes  of  carbon  into  the  atmosphere,  from  oil  190  metric  tonnes  and 
from natural gas 150 metric tonnes. Under normal operating conditions a nuclear power plant 
generates  the  same  kilowatts  essentially  carbon-free.  Emissions  due  to  extraction  and 
fabrication activities for the different types of fuel are not considered in this comparison. 

In  2000  the  NEA38  investigated  the  role  of  nuclear  power  in  alleviating  the  risk  of  global 
climate  change  and  provided  a  quantitative  basis  for  assessing  the  reduction  of  GHG 
emissions following alternative nuclear development paths. The analysis covers the economic, 
financial,  industrial  and  potential  environmental  effects  of  three  alternative  nuclear  power 
development scenarios (“nuclear variants”): continued nuclear growth, a nuclear phase-out or 
a  period  of  stagnation  followed  by  a  nuclear  revival.  Each  of  the  three  variants  would  pose 
challenges  to  the  nuclear  sector,  but  all  of  them  would  be  feasible  in  terms  of  construction 
rate,  financing,  site  selection,  land  requirements  and  natural  resources.  The  NEA  concluded 
that nuclear power is an available option for alleviating the risk of global climate change and 
that keeping the nuclear option open would also foster further development of non-electrical 
applications, such as heat, drinking water and hydrogen production, further enhancing nuclear 
power's  contribution  to  reducing  GHG  emissions.  Consequently,  the  role  of  nuclear  power 
should  continue  to  be  taken  into  account  in  the  discussions  on  the  EU  Emission  Trading 
Scheme. 

35 

36 

37 

38 

According to EDF, its project for construction of a new EPR reactor at Flamanville is expected to cost 
around  €3 billion  to  build  with  the  initial  cost  of  energy  production  around  €43/MWh,  potentially 
subsequently dropping to €35/MWh based on a contract to build a series of 10 NPPs. These costs are 
similar to those expected for Olkiluoto in Finland.  
The  Kyoto  Protocol  is  an  amendment  to  the  United  Nations  Framework  Convention  on  Climate 
Change. It was opened for signature on 11 December 1997 and came into force on 16 February 2005. 
By February 2006, 162 countries, including the EU Member States, were parties to the Protocol. 
According to the International Nuclear Forum, in 1995 electricity utilities’ emissions of CO2 worldwide 
were  32%  lower  than  they  would  have  been  if  fossil  fuels  had  been  used  instead  of  nuclear  energy. 
Emissions of sulphur dioxide and nitrogen oxide were 35% and 31% lower, respectively. 
The OECD NEA is an intergovernmental body with the objective of assisting its member countries (28 
members,  including  all  the  EU  Member  States  with  nuclear  programmes)  in  maintaining  and  further 
developing, through international cooperation, the scientific, technological and legal basis required for 
safe, environment-friendly and economical use of nuclear energy for peaceful purposes. 

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A  study39  contracted  by  the  Commission  provides  in  depth  projections  on  energy 
requirements  and  the  consequences,  based  on  various  scenarios  on  the  choice  of  electricity 
generation  for  the  EU  until  2030.  The  study  shows  that,  in  the  medium  term,  a  sustainable 
choice  for  the  energy  mix  would  be  a  combination  of  renewable  sources  of  energy  and 
investment  in  nuclear  electricity  generation,  combined  with  efforts  to  improve  energy 
efficiency. 

Nuclear power is therefore one of the options available for reducing CO2 emissions. Nuclear 
power  is  presently  one  of  the  largest  sources40  of  CO2-free  production  of  energy  in  the 
European  Union  and  forms  part  of  the  Commission's  carbon  reduction  scenario.  The  IEA's 
2006 World Energy Outlook mentions, in the case of the EU, “extension of the life of nuclear 
plants”  (148  Mt  of  CO2  emissions  avoided)  along  with  increased  use  of  renewable  energy 
sources in power generation (141 Mt of CO2 emissions avoided). Keeping the nuclear option 
open  in  order  to  achieve  this  potential  will  require  a  number  of  decisions  and  measures  by 
governments and industry. 

5. 

CONDITIONS FOR ACCEPTABILITY OF NUCLEAR POWER 

5.1. 

Public opinion and participation 

A factor to be taken into account, which influences the debate on the future of nuclear power, 
is the issue of public opinion because of its impact on the political decisions to be taken and 
of  the  legitimate  right  of  populations  to  be  involved.  Concerns  about  the  safety  of  nuclear 
power plants, management of radioactive waste, security, proliferation and terrorism have all 
had an influence on public opinion. 

The 2005 Eurobarometer survey showed that the EU public is not well informed on nuclear 
issues,  including  possible  benefits  in  terms  of  mitigating  climate  change  and  the  risks 
associated with the different levels of radioactive waste. It also found that out of a majority of 
citizens  having  questions  about  nuclear,  40%  of  opponents  of  nuclear  energy  would  change 
their mind if solutions to nuclear waste issues were found. Consequently, these issues need to 
be solved if nuclear energy is to be considered acceptable. 

Public opinion and perception of nuclear power is paramount to the future of nuclear policy. It 
is  essential  that  the  public  has  access  to  reliable  information  and  can  participate  in  a 
transparent  decision-making  process.  The  EU  will  explore  the  way  to  increase  access  to 
information, possibly by creating a database accessible to citizens. The EU is fully committed 
to  safeguards,  non-proliferation  and  security  of  nuclear  materials,  improving  the  security  of 
nuclear  installations,  enhancing  detection  capabilities,  safe  management  and  transport  of 

39 

40 

“European  Energy  and  Transport  Scenarios  on  Key  Drivers.”  Commission  publication  (September 
2004) produced by the National Technical University of Athens, E3M-Lab, Greece. It shows the results 
of  application  of  the  PRIMES  model  to  investigate  alternative  energy  futures  for  EU-25,  as  distinct 
from  the  baseline  provided  by  the  effects  of  current  trends  and  policies.  The  study  was  taken  as  the 
basis for the Commission publication “European Energy and Transport - Trends to 2030”. 
According  to  EUROSTAT,  nuclear  power  accounted  for  18.2%  and  Hydro  power  18.6%  of  installed 
capacity (743375 MWe) of electricity production in the EU-27 during 2005. The average percentages 
for  nuclear  and  hydro  over  the  period  (1994-2005)  were  19.6%  and  19.7%  respectively.  It  should 
however be noted that nuclear accounted for 30.1% and hydro only 10.3% of actual electricity produced 
and  consumed  (3310401  GWh)  in  the  EU-27  during  2005.  The  average  over  the  period  (1994-2005) 
was 31.7% and 12% for nuclear and hydro respectively. 

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radioactive sources, decommissioning and radiological protection of workers and the general 
public. The Commission will therefore step up its cooperation with the IAEA, Member States 
and operators to enhance their effectiveness and ensure the health, safety and security of the 
public. 

5.2. 

Nuclear safety 

From  the  outset  the  importance  of  nuclear  safety  was  recognised  by  the  European 
Community, as stated in the Euratom Treaty, and accordingly by the Council41. Until now, the 
safety and reliability record of EU nuclear power plants is excellent. Two nuclear accidents, at 
Three  Mile  Island  (1979)  in  the  USA  and  Chernobyl  (1986)  in  Ukraine,  triggered 
international  efforts  to  raise  safety  standards.  Afterwards,  the  industry  came  under  intense 
scrutiny leading to improvement of nuclear safety worldwide. Major lessons were learned for 
all  nuclear  installations.  A  Council  Resolution  on  the  technological  problems  of  nuclear 
safety, published in 1992, reaffirmed the objectives of the 1975 Resolution and extended it to 
non-Community  countries,  notably  in  Central  and  Eastern  Europe  and  the  Republics  of  the 
former Soviet Union42. 

Liability  for  nuclear  accidents  in  the  EU-15  Member  States  is  governed  by  the  Paris 
Convention of 1960, which created a harmonised international system on liability for nuclear 
accidents,  currently  limiting  the  liability  to  operators  in  case  of  nuclear  accidents  to  around 
$700  million.  The  Vienna  Convention,  another  arrangement  on  the  same  subject  but  linked 
with  the  Paris  Convention  by  a  Common  Protocol  of  1988  (creating  a  joint  regime  with 
mutual  recognition  of  the  two  Conventions),  is  applicable  in  the  majority  of  the  ten  new 
Member States. The Commission is aiming  at harmonising  the nuclear  liability rules within 
the Community. An impact assessment will be started to this end in 2007. 

Nuclear safety is still a central issue in the context of the recent enlargements of the EU. Four 
nuclear reactors (Ignalina 1 and 2 in Lithuania and Bohunice 1 and 2 in Slovakia) with first-
generation Soviet-design reactors are being shut down in predetermined stages in compliance 
with the 2004 Accession Treaty43. The EU is providing financial assistance, subject to certain 
conditions, to various projects on decommissioning and replacement of electricity generation 
capacity.  Similar  arrangements  are  in  place  for four  of  the  six  reactors  at  Kozloduy,  two  of 
which are already closed and another two were closed by the end of 2006 as part of Bulgaria's 
EU  Accession  Treaty.  The  Commission  has  adopted  two  proposals  for  regulations44  which 
provide for continued financial assistance to Lithuania and Slovakia until 2013, guaranteeing 
at least the same level of funding as agreed for the period 2004-2006. 

Furthermore, the Community has acceded to the Convention on Nuclear Safety45 and to the 
Joint Convention on the Safety of Spent Fuel Management and on the Safety of Radioactive 
Waste  Management46.  A  revised  declaration  of  competences  for  the  Nuclear  Safety 

41 

42 
43 
44 
45 
46 

Council  Resolution  of  22  July  1975  on  the  technological  problems  of  nuclear  safety  aiming  at 
progressive  harmonisation  of  safety  requirements  and  criteria  in  order  to  provide  an  equivalent  and 
satisfactory degree of protection of the population against radiation risks with no lowering of the safety 
level already attained. 
Council Resolution of 18 June 1992 (OJ C 172, 8.7.1992, p. 2). 
OJ L 236 of 23.9.2003 
COM(2004) 624, 29.9.2004. 
Commission Decision 1999/819/Euratom of 16 November 1999 (OJ L 318, 11.12.1999, p. 20). 
2005/510/Euratom: Commission Decision of 14 June 2005 (OJ L 185, 16.7.2005, p. 33). 

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Convention was deposited with the IAEA in May 200447. The Conventions aim at enhancing 
national measures and international cooperation related to safety. 

Outside  the  Community  the  EU  has  made  a  substantial  contribution  to  improving  nuclear 
safety  in  the  CIS  countries  through  the  TACIS  nuclear  safety  programme,  to  which  it 
allocated some €1.3 billion over the period 1991-2006. This assistance is to be continued from 
the new Instrument for Nuclear Safety and Cooperation, which is no longer limited to the CIS 
but, in principle, allows assistance to other countries. 

Euratom loans have been provided to Kozloduy 5 and 6 in Bulgaria (€212.5 million in 2000), 
Cernavoda  2  in  Romania  (€223.5  million  in   2004)  and  Khmelnitzky  2  and  Rovno  4  in 
Ukraine ($83 million in 2004) to improve their safety standards and/or construction. 

5.3. 

Disposal of radioactive waste 

In the EU as a whole, some 40 000 m3 of radioactive waste is generated each year. The vast 
majority  of  this  radioactive  waste  originates  from  day-to-day  activities  at  NPPs  and  other 
nuclear installations and is classified as low-level and short-lived. Spent nuclear fuel produces 
some  500  m3  of  high-level  waste  per  year,  in  the  form  of  either  irradiated  fuel  or  vitrified 
waste from reprocessing. 

In the case of low-level and short-lived waste, strategies are implemented on industrial scale 
in  nearly  all  EU  Member  States  with  a  nuclear  power  programme.  A  total  of  some 
2 million m3 of such waste  have been disposed of in  the  EU  so  far,  most of it in surface or 
near-surface  facilities.  In  the  case  of  high-level  and  long-lived  waste,  even  though  many  of 
the steps of a management strategy are in place, no country has yet implemented the proposed 
final  solution.  Deep  disposal  in  a  stable  rock  formation  is  the  preferred  option  by  nuclear 
operators,  whereas  others  prefer  near-surface  storage  in  order  to  make  surveillance  and 
potential recovery easier in the future if required. Some of the main factors affecting progress 
on this final step are socio-political rather than technical. To this end there has been progress 
in Finland, where a disposal site has been chosen with the agreement of the local population 
and the endorsement of the Finnish parliament. The Finnish Law excludes any possibility of 
exporting or importing nuclear waste from or to Finland. There have also been big advances 
towards site selection in Sweden and France. However, in most countries site selection is the 
central issue delaying the disposal option. 

Additional techniques for dealing with waste, aimed principally at reducing either the volume 
or  the  long-lived  component,  are  being  developed  in  research  programmes.  These  are 
collectively  referred  to  as  “partitioning  and  transmutation”.  Although  they  would  offer  the 
possibility of reducing the long-lived toxicity of such wastes, they can never totally eliminate 
the need for isolating them from the environment (e.g. in a deep geological repository). This 
“concentrate and confine” approach makes it possible to minimise the environmental impact. 

In  several  cases,  the  estimated  shares  of  waste  management  and  decommissioning  costs  are 
added to the price of electricity in the EU and deposited in special funds. However, because of 
the  difficulty  of  predicting  future  costs,  financing  schemes  need  to  be  kept  under  review  to 

47 

In December 2002 the Court of Justice of the European Communities annulled the third paragraph of 
the  Declaration  attached  to  the  Council  Decision  of  7  December  1998  approving  the  accession  of 
Euratom  to  the  Nuclear  Safety  Convention,  on  the  grounds  that  it  failed  to  state  that  the  Community 
was competent in the fields covered by Articles 7, 14, 16(1) and (3) and 17 to 19 of the Convention. 

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ensure that adequate funding will be available when it is needed. Management of these funds 
varies between Member States. 

The  key  to  progress  is  greater  public  acceptance  and  involvement  in  the  decision-making 
process. Waste is fundamentally an environmental and health issue; as such, management and 
disposal  of  radioactive  waste  have  to  be  subject  to  the  same  scrutiny  applied  to  all  projects 
which could have an impact on humans and their environment. 

Safety also remains at the heart of the Community (Euratom) research effort in various fields. 
There  is  a  recognised  high  level  of  nuclear  safety  in  the  operation  of  the  current  park  of 
nuclear installations in Europe. Maintaining this level and raising it where possible are subject 
to  concerted  and  long-term  research  and  development  (R&D).  The  Euratom  research 
Framework Programme is instrumental in this effort. 

5.4. 

Decommissioning 

Decommissioning  is  the  final  phase  in  the  life  cycle  of  a  nuclear  installation.  It  is  part  of  a 
general strategy of environmental restoration after the end of the industrial activities. 

At  present  over  110  nuclear  facilities  within  the  Union  are  at  various  stages  of 
decommissioning. It is forecast that at least one third of the 152 NPPs currently operating in 
the enlarged European Union will need to be decommissioned by 2025 (without taking into 
account  any  possible  extension  of  the  working  life  of  NPPs).  Decommissioning  is  a 
technically  complex  operation  requiring  considerable  funding.  The  amount  needed  to 
rehabilitate  the  site  of  a  nuclear  plant  is  currently  estimated  to  be  around  10  to  15%  of  the 
initial investment cost for each reactor decommissioned. 
When  the  conditions  for  the  internal  market  in  electricity  were  set48,  decommissioning 
funding  schemes  were  discussed  between  the  European  Parliament,  the  Council  and  the 
Commission.  The  resultant  inter-institutional  statement49  highlighted  the  need  for  adequate 
financial resources for decommissioning and waste management activities to be available for 
the  purpose  for  which  they  were  set  aside  and  to  be  managed  with  full  transparency.  The 
Commission  later  proposed  two  draft  directives  on  nuclear  safety  and  financing  of 
decommissioning and spent fuel management, not yet adopted by Council. 

In order to ensure adequate financial resources, in October 2006 the Commission adopted a 
Recommendation  which  pays  special  attention  to  construction  of  new  nuclear  plants50.  It 
proposes  establishment  of  national  bodies,  independent  in  their  decision-making  from  the 
contributors  to  the  decommissioning  funds.  While  segregated  funds,  either  externally  or 
internally managed, with appropriate controls on use are the preferred option for all existing 
installations, they are clearly recommended for any new plant. Operators should bear the real 
decommissioning costs in their entirety, even beyond existing estimates. 

5.5. 

Radiological protection 

The Health and Safety Chapter of the Euratom Treaty has given birth to a considerable body 
of  Community  legislation  on  health  protection  for  workers  and  members  of  the  public.  The 

48 

49 
50 

Directive  2003/54/EC  of  the  European  Parliament  and  of  the  Council  of  26  June  2003  concerning 
common rules for the internal market in electricity and repealing Directive 96/92/EC. 
OJ L 176, 15.7.2003. 
JO L 330, 28.11.2006. 

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basic  safety  standards  were  updated  in  1996  and  supplemented  by  a  new  Directive  on 
protection of patients in medical applications51 (for therapy and diagnostics). Medical uses of 
radiation sources are becoming increasingly important, with new technologies administering 
ever-increasing  doses  to  the  patient.  Big  savings  in  exposure  of  the  population  could  be 
achieved  in  medicine  and  in  relation  to  natural  radiation  sources  (radon  in  dwellings  or 
industries processing ores with high uranium or thorium content). 

By  contrast,  exposure  of  workers  in  the  nuclear  industry  has  been  showing  a  marked 
downward  trend,  fostered  by  the  regulatory  requirement  that  all  doses  should  be  “as  low  as 
reasonably achievable” (ALARA). Also, discharges of radioactive effluent (both airborne and 
liquid)  from  nuclear  industries,  in  particular  from  reprocessing  plants,  have  decreased 
drastically over the last few decades52. 

Research  conducted  under 
the  Community's  Framework  Programme  has  deepened 
understanding of the biological effects of radiation and confirmed the precautionary approach 
adopted  internationally.  While,  in  normal  operation,  nuclear  installations  can  therefore  truly 
be  regarded  as  safe,  the  possibility  of  a  major  accident  is  not  being  ignored:  Community 
legislation  adopted  in  the  aftermath  of  the  Chernobyl  accident  has  brought  significant 
progress in emergency preparedness, information exchange and controls on food. 

Measures  to  enhance  a  tighter  control  of  radioactive  sources  so  as  to  avoid  misuse,  loss  or 
eliminate risks to exposure of the public due to radiological or nuclear terrorism are also being 
supported by the Commission. 

6. 

ACTION AT EU LEVEL 

6.1. 

The regulatory framework (Euratom Treaty) 

The  Euratom  Treaty  is  a  self  contained  Treaty  that  gives  the  Community  wide  ranging 
competences.  Indeed,  Article  2  requires  the  Community  :  to  promote  research,  to  establish 
uniform safety standards to protect the health of workers and the general public, to facilitate 
investments, to ensure regular and equitable supplies of ores and nuclear fuels, to make sure 
that  nuclear  materials  are  not  diverted  for  purposes  other  than  those  for  which  they  are 
intended, to exercise its right of ownership in respect of special fissile materials, to ensure the 
creation of a common nuclear market in the relevant areas, and to foster the peaceful use of 
nuclear energy by fostering relations with third countries and international organisations. 

The Treaty (Articles 31 and 32) provides a legal basis for Community initiatives on nuclear 
safety.  This  legal  basis  was  endorsed  by  the  Court  of  Justice  in  December  200253.  Under 
Article  35  of  the  Treaty,  Member  States  are  required  to  establish  facilities  to  monitor 
radioactivity levels released into the environment and ensure that they comply with the basic 
safety  standards.  The  Commission  carried  out  26  on-the-spot  verifications  between  January 
1999  and  June  2006.  Since  2004  priority  has  been  given  to  EU-10  countries  (Ignalina  NPP 
(LT) and Temelin NPP (CZ)) and to installations like the Sellafield (UK) and La Hague (FR) 
reprocessing plants. 

51 
52 

53 

Directives 96/29/Euratom and 97/43/Euratom. 
See,  for  example,  “Radioactivity  in  food  and  the  environment”,  UK  Environment  Agency  et  alia, 
October 2006, ISSN 1365-6414. 
European Court of Justice ruling for Case C29/99 on 10.12.2002. 

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Article  37  of  the  Treaty  also  places  an  obligation  on  Member  States  to  provide  the 
Commission with general information relating to any plans for disposal of radioactive waste 
so  that  it  can  evaluate  whether  such  plans  would  affect  the  environment  of  another  EU 
country. A total of 66 submissions, mainly by France, Germany and the UK, have been made 
in  the  last  six  years.  Some  23  of  them  concerned  decommissioning  and  dismantling  and 
another  23  concerned  changes  to  an  existing  facility.  All  the  opinions  released  by  the 
Commission  concluded  that  the  disposal  of  radioactive  waste  was  not  likely  to  result  in 
significant contamination in terms of health on the territory of another Member State. 

Euratom  safeguards,  as  provided  for  under  Articles  77  to  79,  and  the  extensive  powers 
bestowed on the Commission under Articles 81 to 83 are fundamental to safe and secure use 
of  nuclear  materials  and  mandatory  for  continued  use  and  development  of  the  nuclear 
industry.  The  Commission's  over  150  inspectors  submitted  over  3,400  detailed  reports  over 
the period 2004-2005. As a result, the Commission issued over 200 requests for clarifications 
or corrective actions on non-conformity, discrepancies and shortcomings to varying degrees 
in the operators’ nuclear accountancy systems. No evidence was found to suggest that nuclear 
materials  were  diverted  from  their  intended  use.  However,  as  underlined  above,  system 
weaknesses were detected and corrections were implemented by the operators concerned54. 

6.2. 

Commission proposals on nuclear safety 

Greater  harmonisation  of  safety  requirements  for  nuclear  installations  in  the  EU  is  a 
prerequisite  for  the  future  development  of  nuclear  energy.  At  various  times  in  the  past  the 
Commission put forward proposals for directives to set  up a Community framework for  the 
safety of nuclear installations and the management of nuclear waste (known at the time as the 
"Nuclear package"). Although not yet adopted, those proposals have set in motion a process 
leading  to  greater  awareness  of  the  need  to  establish  a  Community  framework  linking  the 
work of national safety authorities. As part of the ongoing work, the Council prepared a report 
that puts forward recommendations that will allow the discussion to restart. 

At  technical  level,  the  Western  Europe  Nuclear  Regulators  Association  (WENRA)55  is 
contributing  significantly  to  the  harmonisation  efforts  by  establishing  “safety  reference 
levels”,  88%  of  which  have  already  been  implemented.  Building  on  the  existing  work  and 
bringing  it  within  the  Community  framework  would  add  value  to  the  national  approaches. 
Based on the technical consensus reached to date by WENRA, a debate on the roles of each 
player involved in nuclear safety should be restarted. 

6.3. 

European programme for critical infrastructure protection 

The  security  and  economy  of  the  European  Union  as  well  as  the  well-being  of  its  citizens 
depends  on  certain  critical  infrastructure  and  the  services  they  provide.  In  order  to  improve 
the  protection  of  such  infrastructure,  including  nuclear  installations,  and  to  prevent  their 
destruction  or  disruption,  the  Commission  is  putting  forward  a  European  Programme  for 
Critical Infrastructure Protection (EPCIP). 

54 
55 

COM(2006) 395. 
Report available at www.wenra.org together with the policy statement of the national safety authorities 
on nuclear safety (December 2005). 

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6.4. 

Euratom research 

At  present,  European  research  in  the  nuclear  field  comes  under  the  Seventh  Euratom 
Framework  Programme  (FP7).  In  particular,  key  political  and  societal  concerns,  such  as 
management  of  radioactive  waste  and  safety  of  existing  reactors,  plus  longer-term  energy-
related  issues,  such  as  innovative  fuel  cycles  and  reactors,  are  addressed.  Education  and 
training together with research infrastructure are crucial cross-cutting areas receiving support. 
These research activities help to structure and catalyse the R&D programmes in the individual 
Member States, contributing to establishment of the “European Research Area” (ERA) in the 
field of nuclear fission. The ERA was launched by the Commission in 2000 to ensure closer 
coordination of research activities and to enhance convergence of policies at national and EU 
levels.  It  is  an  integral  part  of  the  Lisbon  agenda  aiming  at  building  a  more  dynamic  and 
competitive Europe. This Community research strategy started in the Euratom FP6, and will 
be  consolidated  during  the  Euratom  FP7,  especially  by  establishing  technology  platforms 
aiming at fully implementing the ERA in nuclear science and technology. 

Preservation of expertise in radiological protection and nuclear technology in both the nuclear 
industry and medicine is fundamental to the EU, as are safety and environmental protection 
notably through efforts in nuclear fission and innovative reactor technologies. It is important 
that this effort be sustained. In collaboration with global initiatives such as GIF, the current 
Euratom research in this field is principally into the viability of proposed innovative systems 
and fuel cycles. Thereby, it contributes to the debate regarding future energy supply and helps 
strategic decisions regarding energy systems and carriers. 

6.5. 

The way forward  

As  announced  in  the  Green  Paper  on  sustainable,  competitive  and  secure  energy,  the 
Commission has carried out a Strategic Energy Review which offers a European framework 
for  national  decisions  on  the  energy  mix.  The  review  also  facilitates  a  transparent  and 
objective debate on the future role of nuclear energy in the EU energy mix for the Member 
States concerned. 

In  order  to  finalise  and  improve  the  proposals  already  made,  the  discussion  should  notably 
focus on: 

–  recognising  common  nuclear  safety  reference  levels  for  implementation  in  the  EU, 
building on the extensive expertise of Member States’ national nuclear safety authorities; 

–  setting  up  a  High  Level  Group  on  Nuclear  Safety  and  Waste  Management  with  the 
mandate  of  progressively  developing  common  understanding  and,  eventually,  additional 
European rules on nuclear safety; 

–  ensuring  that  Member  States  put  in  place  national  plans  for  management  of  radioactive 

waste; 

–  during  the  early  phase  of  FP7,  establishing  technology  platforms  to  ensure  closer 
coordination of research in national, industrial and Community programmes in the fields of 
sustainable nuclear fission and geological disposal; 

–  monitoring the recommendation on harmonisation of national approaches to management 

of decommissioning funds to ensure that adequate resources are made available; 

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–  simplifying  and  harmonising  licensing  procedures,  based  on  closer  coordination  between 

national regulatory authorities, aiming at maintaining the highest safety standards; 

–  ensuring  greater  availability  of  Euratom  loans,  provided  the  ceilings  are  updated  in  line 

with the needs of the market as already proposed by the Commission; 

–  developing  a  harmonised  liability  scheme  and  mechanisms  to  ensure  the  availability  of 

funds in the event of damage caused by a nuclear accident; 

–  giving new impetus to international cooperation, notably through closer collaboration with 
the IAEA, the NEA, bilateral agreements with non-EU countries and renewed assistance to 
neighbouring countries. 

7. 

CONCLUSIONS 

Nuclear  power  already  contributes  significantly  to  the  EU's  energy  mix,  thereby  mitigating 
concerns about potential shortfalls in the security of supply of electricity. Nuclear electricity 
production costs' sensitivity to fluctuations in the costs of imports of the basic energy sources 
(uranium)  is  limited  and,  as  underlined  by  the  International  Energy  Agency,  it  is  an 
economically  viable  generation  option,  provided  environmental  and  societal  concerns  are 
appropriately taken into account. 

Nuclear  energy,  essentially  free  of  CO2  emissions,  makes  an  important  contribution  to 
mitigation of global climate change as a result of greenhouse gas emissions. 

It is for Member States to decide whether to use nuclear energy or not. For those EU countries 
that choose to continue or to start making use of nuclear energy generation, Member States' 
Governments need to take the necessary decisions. A significant number of NPPs are indeed 
due to close down within the next 20 years. Construction of new plants and/or extension of 
the  current  operating  lifetimes  of  existing  reactors  will  be  required  if  the  Member  States 
choose to maintain the current share of nuclear power in the overall energy mix. 

Globally, demand for nuclear generation is expanding. The EU is a leading industrial actor in 
nuclear  energy.  This  creates  business  opportunities  for  European  companies  and  brings 
potential  advantages  to  the  EU  economy,  thereby  contributing  to  the  Lisbon  agenda. 
Therefore, at least an adequate investment environment and legislative framework is needed 
to develop this potential if need be. 

The  Community  must  enhance  its  cooperation  with  international  bodies,  such  as  the  IAEA 
and  the  NEA,  and  remain  consistent  with  all  international  obligations,  including  on  non-
proliferation  of  nuclear  materials  and  technology,  protection  of  the  health  and  safety  of 
workers and of the general public, nuclear safety and the environment. 

The Community considers nuclear safety paramount in Member States' decision on whether to 
continue to use nuclear energy. For those Member States that choose to go down the nuclear 
path, acceptability by the public will also be an important factor. The Community has a key 
role to play in ensuring that the nuclear industry develops in a safe and secure manner. In that 
respect, the Commission considers it a priority that the Community adopt a legal framework 
on  nuclear  safety,  facilitating  harmonisation  and  compliance  with  internationally  acceptable 
standards  and  ensuring  the  availability  of  adequate  funds  for  decommissioning  NPPs  at  the 
end of their life and national policy plans on management of radioactive waste. 

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Development of nuclear energy will need to be governed in line with the rest of EU energy 
policy in accordance with the principle of Subsidiarity, should be based on the technology's 
own  competitiveness  and  should  be  one  component  of  the  energy  mix.  There  are  clearly 
impacts for the EU as a whole from the decisions which individual member states take in the 
area  of  nuclear  energy,  although  the  choice  of  national  energy  mix  use  is  a  matter  for  each 
Member State. In order to provide a more regular updated picture of the situation in the EU, 
the  Commission  will  –  in  accordance  with  Article  40  of  the  Euratom  Treaty  –  increase  the 
frequency of publication of the Nuclear Illustrative Programmes. 

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