Netherlands Paves the Way for New Nuclear Energy with €5bn Investment
On 15 December 2021, four Dutch parties reached a coalition agreement after months of negotiations. The formation of the new government took 299 days, a record in Dutch history.
One of the new government’s main aims is to tackle climate change: “To be climate neutral in 2050, the Netherlands will tighten the target for 2030 in the Climate Act to at least 55 per cent CO2 reduction.” In the Climate Act of 2019, this figure was 49%. After that, the Netherlands aims for a reduction of 70% by 2035 and 80% by 2040.
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To meet these ambitious goals, the country needs to change course. The Netherlands lags other EU countries on net-zero actions such as renewable energy generation. Under EU law, 14% of final energy consumption in the Netherlands had to be renewable in 2020 but the country only managed 11%. To meet the EU target, the government had to make an agreement with Denmark for a statistical transfer of renewable energy.
In the coalition agreement, the new government says it wants the Netherlands to be a frontrunner in Europe when it comes to combatting global warming. It announced a ten-year €35bn climate fund, in addition to an existing subsidy scheme for sustainable energy. The country's first-ever climate and energy minister will oversee the new fund. A CO2 road pricing system will be introduced in 2030 and “energy networks will be made future-proof”. The government also wants to make “binding customized agreements” with the ten to 20 biggest greenhouse gas emitters in the country.
“It is definitely an improvement compared with the last coalition deal,” says Heleen de Coninck, professor in socio-technical innovation and climate change at the Eindhoven University of Technology. De Coninck is an author of the IPCC Sixth Assessment Report that will be published later this year. “The new government has more ambition and that is very necessary, as the Netherlands is currently not in line with EU goals and other climate targets,” she adds.
One of the most remarkable measures is the ambition to construct two new nuclear power plants. “Nuclear energy could supplement solar, wind and geothermal energy in the energy mix and can be used for the production of hydrogen,” the Dutch government writes in the coalition agreement. “It will make us less dependent on gas imports.”
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By GlobalDataWhile the Netherlands was known as a large gas supplier, in recent years its reliance on imports has grown due to extraction cuts at the Groningen gas field. Since 2018, the Netherlands has become a net importer of gas.
The Netherlands’ limited experience with nuclear
Currently, the Netherlands has one nuclear power plant in operation. The plant in Borssele has been playing a small but steady part in Dutch energy generation over the years, with a total capacity of 482MW in 2021, according to data from GlobalData, Energy Monitor's parent company. That equates to just 1% of the total installed electricity generation capacity in the Netherlands, the lowest among European countries that produce nuclear power.
Yet the new cabinet has pledged to take the necessary steps for the construction of two new nuclear power plants. It has committed €5bn to this and will facilitate market parties in their explorations.
In addition to the two new plants, the Borssele plant will stay open longer. Borssele was due for decommissioning in 2033 and has been in use since 1973. Its decommissioning has been delayed before; in 2006, the government decided it would stay open until 2033 instead of 2013.
Borssele is already one of the oldest operational nuclear plants in Europe. The plant had an intended lifespan of 40 years, but under current plans it will be operational for 70–80 years. If a nuclear plant has consistently invested in maintenance and improvements, this should not be a problem, says Jan Leen Kloosterman, a professor in nuclear reactor physics at Delft University of Technology (TU Delft).
“A lot of nuclear plants are still in good condition after those initial 40 years, including the one at Borssele,” he says. “The government set the benchmark that Borssele has to stay in the top 25% of safest plants. So far, it has been able to keep achieving that.”
EU Taxonomy – a positive Dutch signal?
The Dutch decision to invest in nuclear energy comes at a time of heated debate over nuclear in the EU. The European Commission’s proposal to include nuclear and gas in an EU Taxonomy for green investment has instigated fierce arguments. France, Europe’s primary nuclear proponent, plans to invest €1bn in small modular reactors. No decision on big new nuclear plants has been made; likely that will wait until after the elections.
Meanwhile, Belgium and Germany are headed for nuclear exits. Germany is planning to close the last of its nuclear plants by the end of 2022 and Belgium by the end of 2025. Across the Channel, the UK has announced £1.7bn in funding for a new large-scale nuclear power plant, likely Sizewell C, to be built by EDF as a successor to its Hinkley Point C project.
Brussels-based nuclear industry association Foratom thinks the Netherlands is sending a positive signal to other member states with its decision to include nuclear power in its electricity mix.
“Until now, the Netherlands had not planned on developing new nuclear but rather extending the life of its existing nuclear power plant,” says Jessica Johnson from Foratom.
Johnson adds: “From our perspective, it is sending a positive message at EU level because it shows that a member state that was not planning on new nuclear initially has come back to its decision to be able to achieve its climate goals. We hope to see more member states following suit soon.”
“The Dutch decision to invest in nuclear could strengthen the position of France on this matter, but in the end, the Netherlands’ stance on the Taxonomy will matter more,” says de Coninck.
That stance is not currently clear. In December 2021, the Dutch House of Representatives passed a motion that gas should not be labelled 'green'. However, in summer, the House of Representatives also voted for a motion to include nuclear energy in the EU Taxonomy.
“They find themselves in a conundrum,” says Johnson. “If they want nuclear included in the Taxonomy, they have to accept gas to be so [too].”
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Within the Netherlands, the plans for two new nuclear plants are also stirring debate. “There are few topics that split society as much as nuclear energy,” says de Coninck. “It seems you have to be either for or against it.” De Coninck thinks the step towards more nuclear was not unexpected given the political situation of the country.
“I suspect it is a politically motivated compromise for the strict and ambitious emission goals,” she says. “Two of the big parties in the coalition are pro-nuclear. The argument is that we need a backup for all the variable energy from wind and solar, and they say that nuclear would be the most suitable and CO2-free candidate, although various studies indicate there are other, cheaper options. Most future electricity will be generated by renewables. So the question is how often the nuclear plants would operate. Who wants to invest in a nuclear power plant that is only operational 25% of the time?”
In their election programmes for 2021, the liberal pro-business People’s Party for Freedom and Democracy and centre-right Christian Democratic Appeal expressed a desire to invest in nuclear energy. The other two parties that now form part of the coalition, the left-of-centre liberal Democrats 66 and the conservative Christian Union, were not against new nuclear plants if they are “sustainable and reliable”.
Kloosterman argues that the Dutch choice for nuclear makes sense considering the urgency of net-zero goals. “While the two new nuclear power plants won’t be able to contribute to the 2030 targets, they can contribute to those in 2050. To reach net zero in 2050 we must consider every option. It seems logical to me to give serious consideration to nuclear as part of the mix.”
Kloosterman thinks it unlikely that any new nuclear technologies such as thorium-based generation will be ready in time for the two new plants. “If you want to make sure the plants contribute to 2050 goals, light-water reactors are the only option.”
Cost and skills challenges
One of the biggest obstacles to building the plants will be cost, says de Coninck. She thinks the initial €5bn will likely not be enough. In Finland, the Olkiluoto 3 reactor is more than ten years behind schedule and many times over budget. France has the same issue with Flamanville 3. The completion of Hinkley Point C in the UK will cost £500m more than planned and is delayed to June 2026.
Since the last nuclear power plant in the Netherlands was built more than 50 years ago, there is also a lack of knowledge and expertise in the country, argues de Coninck. “Building two entirely new nuclear plants, while not having done that in half a century, is quite a task.”
Kloosterman disagrees. He says the knowledge is there, but the capacity is not. “If we want to start building nuclear power plants, we have to start training new people as soon as possible.” Education on all levels would need upscaling. Some studies, expertise and research positions that have disappeared over the years would need to be brought back.
Building two entirely new nuclear plants, while not having done that in half a century, is quite a task. – Heleen de Coninck, Eindhoven University of Technology
“At TU Delft, we used to have a chair in nuclear reactor technology,” says Kloosterman. “That professor retired around a decade ago but was never replaced. With the renewed interest in the construction of nuclear power plants, it is necessary to start increasing the capacity in education on a national level.”
This is also why Kloosterman thinks it is important to extend the lifespan of the only plant in the country. “It is important to keep that kind of experience in the Netherlands, the people who understand the operation of a power plant. That is why I think it is a wise decision to keep Borssele operational, so you can keep that experience until the new power plants are built.”
For now, the Dutch government’s plans for the new nuclear plants are still in their early stages. For that reason, de Coninck warns the country should not rely too much on nuclear.
“Building a power plant takes a lot of time and resources," she says. "What if something, like public opinion, changes in the next ten or 20 years? If you opt out then, you are stuck with an unreliable electricity grid or you miss your climate targets. If the government initiates the building of new nuclear plants, they need to make sure it happens.”
A report on public opinion on climate change and the energy transition from Statistics Netherlands in 2020 showed that the Dutch are divided on nuclear energy: around 25% think the Netherlands should invest more in nuclear, 18% think less and 25% think the use of nuclear should stop altogether.
The actual realisation of new Dutch nuclear plants also depends on whether there are energy businesses interested in building and operating them. These private sector players have yet to step forward. To convince them, the government needs to make sure there are clear agreements on the completion of the projects, says Kloosterman.
“Businesses need that guarantee before investing in such a big project," he says. "The government could play a critical role in minimising risks by establishing that once this process is started it will be completed, and that the plant could sell the produced electricity for a cost-effective price.”
