nucleareurope discusses nuclear financing at NERS conference
On 27 November 2024, nucleareurope Communications and Advocacy Director Jessica Johnson participated in a panel discussion on nuclear financing, held in the framework of the 16th NERS conference taking place in Prague.
In her intervention, Jessica outlined different approaches to financing nuclear new build, highlighting that a diversity of financing models can be applied to nuclear. She detailed three models identified by the Organisation for Economic Co-operation and Development Nuclear Energy Agency (OECD NEA): a government financing model where investments are made either through State aid or public borrowing, a corporate model where utilities with strong balance sheet can finance large projects by raising equity and borrowing money, and a project finance model, where a specific project company is created.
Noting that ownership is no longer the single determinant of a nuclear financing model, Jessica added that two main models had been used in the past for ownership – the government and corporate models – and that in both cases, governments play different roles either as investors or as technology providers to a state-owned company.
Jessica then detailed the characteristics of different financing models in terms of ownership and risk transferability from public to private. She stressed that government support was needed across all models, citing the Finnish Mankala model as a successful example.
“Both the investment rating and the ability to attract debt for new projects have a central role to play in the financing of new nuclear projects, and multiple financing mechanisms are required to access a variety of sources of capital” said Jessica, listing key enablers for nuclear financing, such as a stable and long-term investment policy framework for nuclear, an industrial management framework at both project development and ownership levels, and an investment policy planning for low-carbon technologies, including nuclear.
Jessica concluded her intervention by giving an overview of the main funding and financing policy priorities in the next EU mandate, calling for these policies to adopt a technology neutral approach and guarantee equal access to private and public finance for all net-zero technologies.
Read more about nuclear financing in nucleareurope’s investment framework task force report (2021).