After over a year of debate and lobbying, the European Commission revealed its proposal to designate nuclear power and natural gas as “sustainable” in the European Union’s (EU's) sustainable finance taxonomy. The taxonomy classifies certain economic activities with specific environmental criteria as sustainable, in an effort to minimize greenwashing and generate investments for truly green activities as the EU aims to reach net-zero emissions by 2050 (Reuters).

Nuclear and gas are listed as “transitional activities” in the proposal, and come with specific conditions. New gas-fired plants must replace a coal or oil-fired plant and transition to low-carbon gases by 2035, among other conditions, to qualify. Nuclear plants would need to commit to transitioning to “accident-tolerant” fuels by 2025 if available, and lay out plans for radioactive materials storage in 2050 (Politico).  

EU states are deeply divided on the proposal. Its supporters say these energy sources are critical for addressing climate change and would aid in the transition away from coal. Critics argue the proposal is greenwashing and would get in the way of reaching emissions reduction targets, in addition to setting a concerning example for the rest of the world (Reuters). Many states, including Germany and France, supported the “sustainable” designation for at least one of the two energy sources (CNN). Austria and Luxembourg have said they will take the policy proposal to court and challenge it (Independent). There is also a possibility that either a supermajority of EU states or a majority of European Parliament’s lawmakers could veto the proposal.