Cop 27: Nuclear energy in focus

Finance day at the Cop 27 UN climate conference in Sharm el-Sheikh this week saw more focus put on developing nuclear energy, which has been touted in some quarters as the fuel for a carbon-free system and energy security.

IEA executive director Fatih Birol said on the sidelines of the summit that "nuclear is making a comeback", with countries like the Netherlands, Poland and developing countries in Asia-Pacific finding a renewed appetite for new nuclear deals. The IEA, which had predicted an atomic comeback in November last year, was no longer alone in "trying to show the world that nuclear has its place when it comes to addressing energy security and climate change", Birol said.

But he lamented delays in delivery and budget constraints associated with the nuclear industry. He said international financial institutions have "failed" to aid developing countries with clean energy financing, and said: "I wouldn't give them a passing grade".

At Cop 27 there have been some signs of progress. The US Export-Import (Exim) Bank said it would provide a $3bn loan to Romania for construction of two units at the country's 1.4GW Cernavoda nuclear power plant. The bank handed two letters of interest to Romania's energy minister Virgil Popescu at the summit, outlining an initial $50mn loan to support development of a second phase of the new units, and a subsequent loan of $3bn that will cover the bank's total contribution to the project.

US presidential climate envoy John Kerry called this financing a "bolster" for energy security and said it will help "expand carbon-free energy" in Romania.

Egypt's oil minister Tarek el-Molla said at Cop 27 that the country is on track to achieve its goal of increasing the share of renewables in the energy mix, and that nuclear energy should be included in this. Construction at the country's first nuclear power plant at El-Dabaa, northwest of Cairo, started in July.

Earlier in the week, French President Emmanuel Macron said nuclear energy, alongside renewables, was an important pillar for countries such as South Africa to move away from coal, and said Paris would invest €1bn in helping South Africa achieve that goal.

Countries like Romania, South Africa and Egypt adopting or increasing their nuclear generating capacity are essential if the IEA is to be proven right that there will be a doubling of capacity between 2020-50, as it estimated in its global pathway to net zero emissions by 2050.

"When we look at the world, electricity demand growth comes from emerging countries," Birol said in Egypt. "And for these emerging countries to build large scale nuclear power plants may be a bit challenging for many reasons, including financial, in the first down payment and the technology." He stressed the need for small modular reactors to be commercially available before or around 2030, which he said would give a "very good chance" for emerging economies to meet growing power demand.

By Florence Schmit, Nader Itayim and Rithika Krishna