NUCLEAR POWER & ESG: A question of identity?

Nuclear power has long been a contentious topic, particularly in the context of clean energy and decarbonisation. Whilst some argue that it could be a valuable tool in weaning the world off its addiction to fossil fuels, others contend that it presents too much of a risk to even be considered “green”. 

With ESG (Environmental, Social Governance) frameworks playing an increasingly prominent role in guiding investors and institutions, the question arises: should nuclear power be considered ESG-compliant?

The Current State of Nuclear Energy Usage

There is an international consensus on our need to reduce greenhouse gas emissions – primarily caused by our use of petrochemicals – and considerable resources are being expended to come up with alternative energy sources with less environmental impact. The International Energy Agency reports that global clean energy investment in 2024 is set to reach $2 trillion, 80 billion of which being spent on nuclear energy. 

Studies by the UN’s Intergovernmental Panel on Climate Change (IPCC) have shown that nuclear power emits 3.7-110 grams of CO2 per kWh, compared to 11-40 grams for wind and solar, making it one of the lowest-carbon energy sources available. Additionally, unlike renewables that depend on sunlight or wind, nuclear power provides a stable, continuous energy supply, reducing the need for large-scale energy storage solutions to manage fluctuations.

In pursuit of decarbonisation targets, some of the world clearly intends to rely heavily on nuclear power. In China, 25 new nuclear facilities are under construction, 11 of which were commissioned in only August this year. But this contrasts considerably with the slower development of nuclear – and even the complete phasing out of existing projects – in the Western world. For instance, in 2023, Germany closed its last three nuclear power plants—a project referred to by the German government as a ‘great success’, whilst critics have pointed out that it has led to an increased reliance on coal, raising questions about its commitment to lowering emissions.

The Promised Potential of Nuclear Energy

Imagine if today, a revolutionary new energy technology was discovered. One that could generate enormous amounts of clean energy; indeed, enough reliable power to meet the energy needs of the entire planet at a fraction of the environmental cost of existing solutions. It would require minimal land, produce zero carbon emissions, and operate continuously, unaffected by weather conditions. 

You would expect many to consider this a breakthrough—a panacea to the world’s most pressing energy problems, eliminating our need for fossil fuels and decarbonising entire economies. And when the first nuclear power stations emerged in the 1950s, this is how it was perceived.

As Lewis Strauss, the former head of the US Atomic Energy Commission, predicted in 1954:

“It is not too much to expect that our children will enjoy in their homes electrical energy too cheap to meter... It will be [nuclear] power that will energise the machines of industry and the homes of tomorrow.”

Whilst the world had little awareness of fossil fuel-driven climate change at the time, the promise of energy security free from geopolitical tensions was clear. 

So Why Hasn’t It Happened? A Double-Edged Sword 

Whilst many hailed nuclear as the beginning of the end of our energy issues, there has always been an awareness of its associated risks. Humankind’s ability to split the atom yielded access to a great deal of energy, but this energy could be used as destructively as it could constructively. Even Einstein urged caution with the emergence of nuclear power, hailing its benefits but warning: 

“The release of atomic energy has not created a new problem. It has merely made more urgent the necessity of solving an existing one.” 

The problem here was man’s apparent inclination to use anything with destructive capacity for destruction.

First real political opposition to nuclear power emerged with the green movements of the 1970’s. In fact, the political green movement came directly out of the anti-nuclear and world peace movements, such as the German Green party (Die Grünen) who were the first to gain national prominence; inspiring the emergence of such parties – with similar policies – across the world. The nuclear disasters in Chernobyl (1986) and Fukashima (2011) entrenched their positions, seemingly vindicating them on the catastrophic dangers of human error in nuclear technology. 

Green opposition to nuclear energy is generally based on several foundations: its dual-use as a weapon; the argument that when it goes wrong, it goes really wrong; and what they perceive as a lack of good solutions for how we deal with nuclear waste, which remains hazardous for tens of thousands of years. 

However, whilst the first two arguments certainly carry weight, it does seem more prudent to have waste that can be contained and managed, rather than pollution dispersed throughout the atmosphere (as is the case with fossil fuels).

Shifting Views: A Growing Divide

Despite entrenched opposition, some prominent environmentalists are rethinking their stance on nuclear energy. George Monbiot, a prominent British environmentalist, now argues that refusing to consider nuclear, despite its low-carbon footprint, is akin to climate denial—driven more by dogma than fact. Similarly, the Finnish Green Party’s decision to accept nuclear as a necessary tool in our transition away from fossil fuels, has led to accusations of treachery from the wider green movement.

The fact that the mere consideration of nuclear energy for decarbonisation, despite its low-carbon nature, is treated as an act of betrayal reflects how deeply tied some environmental positions are to identity—perhaps at the cost of pragmatism in the fight against climate change.

So, Is Nuclear ESG?

The question of whether nuclear power qualifies as ESG-compliant is far from settled. Unlike universally agreed-upon standards for renewable energy, ESG frameworks vary between regions and institutions. Some countries and regulatory bodies have begun to accept nuclear energy as “green” under certain conditions. For instance, in 2022, the European Union classified nuclear energy as a sustainable investment under its EU Taxonomy, as long as strict safety standards and waste management protocols are followed. This has sparked debate across Europe, with countries like France considering nuclear as essential for achieving net-zero emissions, whilst others, like Germany and Austria, remain adamantly opposed. 

In essence, with no internationally centralised or legally binding ESG standards, it remains up to individual investors and institutions to define where nuclear power fits within their ESG goals.

In any case, I don’t dismiss the very real concerns around nuclear safety, but we must look at this question with an open-mind, free from ideological bias. My main concern is that if opposition to nuclear power is driven more by entrenched identity markers than by a thorough assessment of the facts, we risk overlooking viable solutions to what is the world’s most pressing challenge.

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