BRUSSELS -- The much-touted European "nuclear renaissance," a key element in the European Union's climate-change policy, still needs to overcome formidable obstacles to become a reality -- most notably in Germany.

This was one of the lessons learned at a two-day nuclear energy conference organized last week in Brussels by Marketforce, a public relations company. Speakers claimed repeatedly that times have vastly improved for the nuclear industry, due to the specter of global warming and pledges made by various countries and regions to fight it.

"The future of the nuclear industry has not been this bright for 20 to 25 years," noted Ralf Güldner, a member of the board of E.ON Kernkraft, the nuclear subsidiary of Germany's utility E.ON Energie. "Most European countries are thinking of having nuclear as part of their energy portfolios."

Participants were reminded of the long list of nuclear power projects often mentioned as illustrations of Europe's "nuclear renaissance."

In France, a nuclear power reactor is under construction, a second is in the planning stages and a third may follow. Finland is also building a power reactor. Three are planned for Switzerland, two for the Czech Republic and one or two each for Poland and Lithuania.

Sweden has lifted its 30-year ban on new nuclear plant construction. More than 20 years after banning nuclear energy, Italy has just signed an agreement with France for at least four nuclear plants. Debates on "new builds" are under way in Germany, Belgium, the Netherlands and Hungary.

A nuclear replacement program is starting up in the United Kingdom. Robert Davies, U.K. country director at the French nuclear group Areva, lauded the "remarkable transformation" of the U.K. government's nuclear policy over the last four years. He predicted that the British nuclear market "will lead the European nuclear renaissance."

Yet the overall tone of the conference was generally far less upbeat than Davies' remarks. Several speakers mentioned a fact with which all participants are all too familiar: Though "global warming is good for nuclear energy," as one speaker bluntly put it, the industry remains unpopular with most Europeans.

Public opinion: still thumbs down

"We are still the bad, and renewables are still the good," lamented Koen Beyaert, director of communication at the Belgian Nuclear Forum, a pro-nuclear lobby. He explained nuclear energy's negative image as due to "decades of non-communication or purely scientific communication."

The industry is keenly aware, however, that its poor image is largely due not to a lack of good PR but to a dearth of satisfactory solutions to the tricky problem of nuclear waste. "To have public support, we need to solve the final disposal issue," said E.ON's Güldner.

Ute Blohm-Hieber, head of nuclear energy and waste management at the European Commission, agreed that waste is the "Achilles' heel of the nuclear industry."

Europeans are much more convinced of the risks attached to nuclear waste than they are of the potentially positive effects of nuclear energy on the climate -- a viewpoint the industry is promoting to polish its image.

A 2008 E.U. poll showed that radioactive waste remains a major obstacle to acceptance of nuclear energy, and that 4 out of 10 nuclear energy opponents would change their minds if a safe, permanent solution were found for waste management.

An earlier E.U. survey (2007) revealed that only a minority of Europeans (46 percent) agreed or tended to agree that nuclear energy does help limit global warming. By contrast, a strong majority (69 percent) believed that nuclear energy decreases Europe's energy dependency, and half of respondents felt that nuclear energy ensures lower and more stable energy prices.

The pollsters observed a high level of non-responses (23 percent) for a statement to the effect that nuclear energy helps to limit global warming. "This implies that not all Europeans are well aware of the low level of greenhouse gases emitted by nuclear energy as compared to many other energy sources, such as oil and coal," concluded the E.U. pollsters.

The percentage of people who agree that nuclear energy helps limit global warming varied enormously among European countries, from a record 77 percent in Sweden to only 30 percent in Spain, which is focusing its energy policy on renewables.

In countries such as Belgium and Germany, the nuclear industry is striving to change public perception through public relations campaigns.

Little political support yet in Germany

The German nuclear industry has a big incentive for stepping up its public relations efforts: It hopes to convince as many politicians and voters as possible of the advantages of nuclear energy before September's German general election.

"So far, people have not really understood that nuclear energy can contribute significantly to solving the climate issue," said E.ON's Güldner in a sideline interview at Marketforce's conference. "We need to educate people; this is something the industry will be working on in the months up until the election."

Since last year, the German Nuclear Forum, another nuclear energy lobby, has been running a public relations campaign in Germany that employs innovative PR techniques to target not only decision-makers, but also women and the "young avant-garde."

Since Germany made the decision to phase out its nuclear power plants by 2020, the nuclear industry's priority has been to win political acceptance for lifetime extensions for existing plants. So far, acknowledged Güldner, this type of political support is nonexistent. To create it, the nuclear industry needs to win over the public. "And to do that, we need to solve the final disposal issue," he added.

According to Güldner, no single party will hold an absolute majority after the forthcoming federal election, but if the votes produce a governing coalition, such as an alliance of conservatives and liberals more favorable to nuclear energy than the present one, the industry will have a shot at negotiating with the government to reverse the phase-out program.

"We are ready to do this, but if a completely adverse government comes to power, it'll be very difficult," predicted Güldner. The Social Democratic Party officially opposes nuclear energy, and the Green and left-wing parties are absolutely against it and are "not moving at all" on the subject, according to Güldner.

But public acceptance is not the only major hurdle the European "nuclear energy renaissance" must overcome. Another is financing.

Hopes may be soaring, but construction money isn't

Xavier de Rollat, director of corporate and investment banking at Société Générale, calculated that as of January 2009, three dozen new reactors were being planned in Europe (excluding Russia and Ukraine); this means that a minimum of €100 billion in investments will likely be required.

The problem, observed de Rollat, is that "all the major European utilities have taken a hit on their balance sheets" from the "brutal impact" of the economic crisis on the European economy. He said there is much uncertainty, since "we don't know if the energy markets -- oil, gas, European emissions rights and power prices -- have reached their lowest levels."

De Rollat put the financing of the "renaissance" into a crude financial perspective: European banks, he says, are believed to have 75 percent as much exposure to U.S. toxic debt as American banks and have been slower to take write-downs ($740 billion dollars in the United States versus $300 billion in Europe). In addition, E.U. banks have $1,600 billion of exposure to Eastern Europe.

Added de Rollat, "European new-build projects face competition for access to [financial] resources" at a time when banks all over the world are much more selective in their lending because money is so scarce.

"Most new-build projects in Europe target grid connection in 2015-20: How realistic is that? Can all announced projects be made at the same time?" he asked, noting also that the limited number of nuclear technology suppliers may also risk slowing down the fledgling "nuclear renaissance."

De Rollat predicted that of the many countries announcing their intentions to start nuclear programs, some will have a hard time raising the money for it.

Darius Montvila, strategic projects director at LEO LT, Lithuania's national energy company, agreed: "We have chosen the technology, but financing will be difficult, given Lithuania's size and the economic situation." LEO LT wants to build a new nuclear plant by 2018 to make up for the phasing-out of two Soviet-era reactors.

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