Is nuclear energy poised for an ESG-fueled comeback?

In a world of rising energy insecurity, climate change and skyrocketing energy prices, nuclear energy might be one of the only sectors feeling more bullish than ever.

"Once seen as an energy option on its last legs, the nuclear industry has had several victories lately. California Gov. Gavin Newsom (D) signed a bill intended to keep the Diablo Canyon plant running past its expected retirement date, and Germany plans to keep two aging nuclear plants available until at least April.

The energy security arguments for those plants in some ways mirror those of the 1970s, which led to a huge nuclear build-out. Then, it was skyrocketing gasoline prices and anti-market actions from Middle Eastern oil exporters creating energy insecurity. Today, similar factors are at play, with Russia now causing supply concerns and natural gas prices spiking. There’s also the ticking tock of climate change making zero-carbon nuclear particularly attractive in a world racing to cut emissions.

Supporters say there’s enough momentum for a nuclear renaissance that would catapult the industry into a greater role in the world’s clean energy future. Newsom backed an effort to keep the Diablo Canyon plant open until 2030, for example, as climate-linked wildfires and heat waves showed it would be tough for California to lose a big zero-carbon power source in the coming years as it strives to slash emissions.

But the nuclear industry has long voiced concerns over what it sees as hesitancy and unfair treatment in the world of climate finance and ESG, the movement to include environmental, social and governance issues in investing principles.

“Nuclear should be getting credit for ESG, and I’d like to tell you that it’s that simple, but it’s not,” said Maria Korsnick, CEO of the Nuclear Energy Institute industry group, during an NEI event in June. “There’s some financial institutions that look at nuclear and look at ESG, and they struggle to say that nuclear actually supports it.”

Read more at EnergyWire: Is nuclear energy poised for an ESG-fueled comeback?, by Nico Portuondo, published October 4, 2022.

Published by Nucleation Capital in Capital reallocation, Carbon emissions, Carbon markets, Climate change, Energy abundance, History-making, LINKS, Nuclear competitiveness, Nuclear financing, Nuclear-inclusive energy policy, Public companies, Solving climate, Zero emission energy

September 26, 2022

Issuance of first-ever voluntary nuclear energy carbon credits

This corporate PR news made zero headlines in the press but we could not be more excited about it. Yet, this unassuming group of executives pursuing their own corporate objectives, could well have an enormous impact on the future of the whole planet. The agreement they reached and announced in a joint press release, involving the planned procurement by Microsoft of Clean Energy Credits (CECs) from OPG, may be the first-ever voluntary corporate purchase of a carbon-credit from nuclear energy.

This auspicious moment deserves more attention than it received, as it marks the inclusion of nuclear energy for the first time as a source of carbon credits. Up until now, for no reason other than possibly concerns about public perception, carbon credit purchases (which are an entirely voluntary type of corporate greenwashing) have come solely from purchasing rights to claim credit for new renewable energy generation and activities like reforestation or rainforest preservation. As far as we know, no company has elected to purchase clean energy credits from nuclear energy.

This ground-breaking agreement could well serve as a model for many other companies seeking truly meaningful ways to reduce their actual and ongoing carbon impacts and the team involved in the deal is clearly aware that they are setting a new precedent. The press release included the following three quotes from Ken Hartwick, President and CEO of OPG, Chris Barry, President of Microsoft Canada, and Todd Smith, Canada's Minister or Energy:

“This innovative partnership will not only spur economic development in Ontario, but also serve as a model for other companies and jurisdictions to encourage use of clean hydro and nuclear power,” said Ken Hartwick, OPG President and CEO. “As part of OPG’s Climate Change Plan, we committed to achieving net zero as a company by 2040, and to act as a catalyst for efficient economy-wide decarbonization. Ensuring industry has access to clean energy to offset emissions assists in meeting that goal.”

“We can only address climate change by tackling the challenge collectively. Agreements like this one with OPG will help Microsoft move closer to achieving our sustainability commitments, including our goal of having 100 percent of our electricity consumption, 100 percent of the time, matched by zero carbon energy purchases by 2030.” said Chris Barry, President, Microsoft Canada. “Working closely with like-minded organizations like OPG, will help us move toward a more sustainable future, while continuing to power innovation in Ontario.”

“As environmental goals increasingly influence corporate decisions on where to invest and grow, this partnership between OPG and Microsoft illustrates the potential for Ontario’s Clean Energy Credit registry to draw businesses from across the world to our province,” said Todd Smith, Minister of Energy. “This voluntary registry will incentivize investments in new clean energy generation and technological innovation while reducing costs for ratepayers.”

Read more at Microsoft News Centre Canada: OPT and Microsoft announce strategic partnership to power a Net-Zero future for Ontario, published September 26, 2022.

Published by Nucleation Capital in Capital reallocation, Carbon emissions, Carbon markets, Climate change, Corporate decarbonization, Corporate purpose, Energy abundance, Future of Energy, History Timeline, History-making, LINKS, Nuclear competitiveness, Nuclear financing, Nuclear-inclusive energy policy, Public companies, Solving climate, Zero emission energy

December 10, 2021

10 EU countries call on Brussels to label nuclear energy as green source

With the eyes of the world watching, French President Emmanuel Macron led an effort, joined by nine other European nations, to call on the European Commission to recognise nuclear power as a low-carbon energy source that should be part of the bloc's decades long transition to climate neutrality.

Making the case for nuclear energy as a "key, affordable, stable and independent energy sources" the writers argue that nuclear energy could protect EU consumers from being "exposed to the volatility of prices."

Nuclear energy accounts for over a quarter of the electricity produced in the European Union, and over 74% for France, which initiated the letter that was signed by Bulgaria, Croatia, Czech Republic, Finland, Hungary, Poland, Slovakia, Slovenia and Romania.

Over 90% of the EU's natural gas come from foreign importers, with Russia as the main producer. This great dependency has been credited as one of the main factors behind the rise in energy prices as well as supply insecurity.

"Supply tensions will be more and more frequent and we have no choice but to diversify our supply. We should pay attention not to increase our dependency on energy imports from outside Europe."

The signatories urge the Commission to include nuclear energy inside the EU green taxonomy, a technical guidebook that helps governments and investors to identify which projects respect the Paris Agreement and which ones are in breach of its climate goals.

Read more in Euro News' Led by France, 10 EU countries call on Brussels to label nuclear energy as green source, published December 10, 2021.

Published by Nucleation Capital in Brilliant thinkers, Capital reallocation, Carbon emissions, Carbon markets, Climate change, Climate policy, Environmental support for nuclear, Future of Energy, International support for nuclear, LINKS, Politicians supporting nuclear, Reduced ecosystem impacts

July 15, 2021

China launches national carbon market

According to Bloomberg Green, China's national carbon market opened with a "flurry of trades that sent prices surging." This is exceptionally exciting news, yet Bloomberg's annonymous report went on to enumerate many reasons why this is a less than stellar achievement, claiming that "it’ll be years before the system helps the top polluting nation curb its emissions."

We say "bull pucky" to that. China pulls way ahead of the U.S. with this launch, which requires even state-owned oil giants such as China Petroleum & Chemical Corp., known as Sinopec, and China Energy Investment Corp., one of the world’s largest coal producers, to participate in trading carbon allowances. The frenzy produced a rise of 10%—deemed the daily limit—within about 10 minutes of the launch.

While there are always issues to be worked out whenever a new market is launched, as far it goes, China Carbon market's first day was a huge success. Carbon allowances opened at 48 yuan ($7.42) a metric ton and traded as high as 52.80 yuan, limited by the defined max.

China's carbon prices may be starting low but it won't take long for them to exceed those of California's Cap & Trade system, where the price of carbon started at $12 in November 2014 and which grew a total of 40% over the subsequent five years. It then languished at around $17 from 2019 until May of this year, when it suddenly began to climb. This performance is an embarrassment and shows the power of the fossil fuel lobby in California throughout the last decade, since the price of buying CO2 hovers at around $150 on the commondity market. China's carbon market could theoretically exceed the price of carbon in California within a matter of weeks, even with a 10% daily cap.

We are encouraged by China's achievement and believe that they are moving along with an important tool to place the appropriate market signals on carbon emissions. It is not clear why Bloomberg feels the need to dis their efforts and diminish the importance of this launch but we believe this will light a fire under the U.S. to take more action, which may explain why the price of California's permits started showing some upward movement in price during the May auction.

Read Bloomberg Green's unsigned report, Top Carbon Market Launch Won't Help China Tame Emissions Yet," posted July 15, 2021.

Published by Nucleation Capital in Carbon emissions, Carbon markets, Climate change, Climate policy, Government support, History Timeline, History-making, LINKS

June 1, 2021

Biden should impose a carbon fee immediately

James Hansen and Daniel M. Galpern co-authored an opinion piece which was published in the Boston Globe, entitled "Biden should impose a carbon fee immediately." According to the authors, under the Independent Offices Appropriations Act, the president retains authority to direct the Environmental Protection Agency to impose a fee on greenhouse gas emissions.

As they explain, the president retains authority to direct a relevant federal agency (here, the Environmental Protection Agency) to impose a fee on GHG emissions. The fee can be collected efficiently from the about 200 oil, gas, and coal companies that produce, refine, and distribute fossil fuels in the United States.

This is a crucial clarification to executive authority, because EPA has labored for decades under a presumption that it lacked authority to impose such fees. That assumption derived in part from an aside in a legal memorandum by then-EPA General Counsel E. Donald Elliott. Elliott had reviewed economic incentives available to the agency to restrict pollution but, by his own later admission, Elliott at that time was “woefully ignorant of the IOAA and related jurisprudence.” Writing in 2019, Elliott sought to “set the record straight that EPA does have existing authority to impose a reasonable user fee on releases of carbon dioxide and other GHGs . . . any time that it has the political will to do so.”

Economists agree that a rising carbon price covering all fossil fuel uses is essential for rapid phasedown of emissions. More than 3,500 economists — including 28 Nobel Prize laureates, all four living former chairs of the Federal Reserve, and 15 former chairs of the President’s Council of Economic Advisers — issued a statement endorsing a carbon fee and dividend. More than 400 student body presidents, representing more than 4 million college students across all 50 states, support a carbon fee and dividend as well.

See The Boston Globe oped "Biden should impose a carbon fee immediately." by James Hansen and Daniel M. Galpern, June 1, 2021.

Published by Nucleation Capital in Brilliant thinkers, Carbon emissions, Carbon markets, Climate change, LINKS, Solving climate, US technological leadership

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