Europe’s uranium dilemma – GIS Reports

The EU imports a fifth of its uranium supplies from Russia and sooner or later it will be pressured to look for alternatives.

Even though the media has mainly focused on the EU’s oil and gas dependence, Russia’s nuclear manufacturing is also an integral part of Europe’s energy supply. ©Getty Images
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In a word

  • EU energy security is not limited to oil and gas supply
  • Europe still relies on Russian uranium to produce nuclear energy
  • Other possible suppliers also carry geopolitical risks

Russia’s invasion of Ukraine sent shockwaves across the world, especially in Europe. In energy markets, customers and households were exposed to rapidly rising prices at a critical time when the economy was just recovering from the Covid-19 pandemic.

However, the impact of the crisis on prices is only part of the story and will likely be resolved by market mechanisms over time. The most important and lasting effect is the tectonic shift unleashed in global trade, investment decisions and policy shifts.

Energy security has always been an important pillar of EU energy policy, but has received varying attention over the years. In times of scarcity (even if only perceived) it acquires a great sense of urgency, but then fades to the back burner when supplies are plentiful and prices low. Today, the question is again on the front of the stage. Everyone closely monitors the Russian energy supply in Europe, measures the threats and hopes to weaken this political lever. As European Commissioner for Energy Kadri Simson described it: “Russia’s invasion of Ukraine has worsened the security of supply situation.

Determination

Europeans had long feared that Russia would use its energy trade for political purposes. The current crisis has confirmed these fears; Europe has been unable to sanction Russian energy exports due to its heavy dependence. As of 2013, all EU member states are net energy importers, with Russia being the main supplier of the main primary energy products – natural gas, crude oil and hard coal.

The invasion of Ukraine was a step too far for the international community. But the EU’s indecisiveness in imposing sanctions on Russia’s energy trade has been criticized by many commentators. The EU therefore announced its intention to phase out dependence on Russian fossil fuels well before 2030. “The new geopolitical and energy market reality requires us to significantly accelerate the transition to clean energy and increase the Europe’s energy independence from unreliable suppliers and volatile fossil fuels”. said the European Commission in early March.

Several questions arise from this statement, chief among them where these supplies will come from. The focus has been largely limited to replacing Russian oil, coal and gas. However, as has been widely recognised, a rapid switch to other fossil fuel sources is neither practical nor straightforward. Additional supplies must be secured to fill the massive void left by the loss of not only the largest exporter of fossil fuels to the continent, but also one of the cheapest suppliers. A fraction of these are readily available, but for larger volumes, investment is needed, especially given competition from other regions and consumers.

Missing fuel

Investments are needed not only in oil, coal and gas, but also in alternative energy sources, including renewable energy and nuclear energy. The International Energy Agency (IEA) recognizes the role that nuclear energy can play in reducing the EU’s dependence on gas supplies from Russia and recommends maximizing the production of the largest source of low-emission electricity in the Union. Moreover, in most of the 1.5 degree Celsius trajectories envisaged by the Intergovernmental Panel on Climate Change (IPCC), the share of nuclear energy in electricity production is expected to increase. Nuclear power is also seen as more compatible with EU climate change goals than fossil fuels.

Nuclear power covers around 25% of EU electricity production, although in countries like France it accounts for over 66%. Russia is the second largest exporter of uranium to the EU, supplying 20.2% of the Union’s needs, after Niger (20.3%). Somehow, this aspect of Russia’s trade with the EU has been largely omitted from the bloc’s official statements in response to the current crisis. This could partly be explained by the fact that only 13 members of the Union use nuclear energy, but that some of them export nuclear-generated electricity to neighboring countries.

More importantly, nuclear energy is a controversial issue. In February, the European Commission unveiled its taxonomy of environmentally sustainable activities and extended this categorization to nuclear power if countries can prove they can safely dispose of the waste. Such a classification, however, has created a backlash, as opponents of nuclear power argue that it has the potential to “cause significant harm”, making it impossible to obtain the EU green label.

Sooner or later, the EU will come under pressure to review its dependence on Russian uranium. In a press briefing in March this year, Sweden’s Minister for Energy and Digital Development, Khashayar Farmanbar, said the Swedish government “wants to see two concrete changes in Europe’s energy supply. First, the EU must stop depending on Russian gas. Second, EU member states must stop importing nuclear fuel from Russia.

Phasing out Russian uranium while preserving (or even developing) domestic nuclear power would mean increased dependence on other countries. However, the EU needs to carefully assess the risk of relying on other suppliers. Kazakhstan, for example, has the potential to fill some of the gaps created by the loss of Russian uranium. However, the EU should weigh the geopolitical risks. Kazakhstan faces Russian claims to some of its northern territories and depends on Moscow and Beijing to export its resources.

Broader perspective

EU security of supply is clearly defined in the European Energy Security Strategy of 2015: “The prosperity and security of the EU depend on a stable and abundant supply of energy” – a definition that continues to s apply, even though it tends to single out natural gas as the primary source of concern. The IEA uses a more comprehensive formulation: “reliable and affordable access to all fuels and energy sources”, especially as the energy transition has broadened the scope of what constitutes energy security. This should be the definition that the EU adopts and pursues.

A study further expands the concept and argues that energy security must extend beyond traditional concerns such as the security of fossil fuel supplies. “Energy security – the equitable provision of available, affordable, reliable, efficient, environmentally friendly, proactively managed, and socially acceptable energy services to end users – is inextricably linked to both traditional conceptions of national security and emerging concepts of human rights and individual security. “, concludes the document.

This definition, if fully adopted, would cause serious problems for the EU, as some of the Union’s major energy exporters, particularly in developing economies, do not perform well on many these aspects. Such targets may also seem unachievable in the midst of the current crisis, but they should give the EU direction as it seeks new energy supplies and engages in long-term purchases.