Public Investment in Nuclear R&D: A Lever for Environmental Impact?

In light of the need to decarbonize energy systems, public investment in nuclear research and development (R&D) raises crucial questions. A recent study examines the impact of these budgets on environmental quality, revealing varied effects depending on national contexts. Overall, the study finds a reduction in the ecological footprint of countries involved.

A new study [1], published in the prestigious journal Energy in late August 2024 by an international team of researchers (China, Pakistan, Turkey, Uzbekistan, Lebanon), explores the benefits of public funding allocated to nuclear technologies on environmental quality in the ten largest economies engaged in nuclear R&D programs: Germany, South Korea, Japan, the United Kingdom, France, Russia, China, the United States, India, and Canada. Whereas previous studies focused on the overall impact, this new investigation explores the specific effects at the country level and within the different contexts each country faces.

The results show that budgets devoted to nuclear technologies have a positive impact on environmental quality by reducing the ecological footprint in most economies, particularly at specific points in the data distribution. The study also highlights that the differences in this relationship vary from country to country, making it crucial to develop nuclear policies tailored to national environmental and economic specificities.

France’s Record Investment in R&D

Public investment in energy research and development (R&D) reached a historical record in France in 2022, with €2,018 million, or about 0.08% of GDP, marking a rise for the third consecutive year despite the constraints on public finances. The share directed towards nuclear energy R&D, €824 million, decreased by 17% in 2022 compared to 2021, which was considered an “exceptional” year in terms of investment. This change is explained by “the decline in investments related to the Jules Horowitz research reactor project, which received significant funding accounted for in 2021.”

Approximately a quarter of the G7 countries’ public energy R&D budgets is allocated to nuclear energy, with contrasting situations between countries depending on the direction their energy policy takes. For instance, while the budget is shrinking in Germany and Japan, it is expanding significantly in the United Kingdom, where nuclear energy is experiencing a strong revival.

Benefits of Public Investment in R&D

The return of the state to the forefront of economic activity since the Covid-19 pandemic has been described in various ways – “investor state,” a return to planning, etc. – but this phenomenon is not new for the nuclear sector. The sustained and nearly constant, if not growing, involvement of the French state in nuclear R&D demonstrates both the strategic importance of this sector and the economic, social, and environmental benefits recognized by policymakers. This commitment has even persisted through the austerity measures that followed the Euro crisis.

Moreover, it is worth noting the political consistency of this investment policy in France, despite changes in government and budgetary shifts. The question arises as to the return on such a policy from an environmental perspective: what minimum conclusions can be drawn about the impact of public R&D budgets in nuclear energy on emissions? While the answer concerning nuclear electricity production is now well-documented [2], the question posed here has received less research attention, likely because it is less immediate and involves a more complex set of processes linking budget dynamics, industrial development, energy production, and environmental footprint.

The recent academic study offers a detailed initial response. It does not adhere to one extreme or the other in a polarized view of the issue: either that it is supposedly a waste of public money diverted from R&D in other energy sources, or that nuclear being low-carbon, any state support for R&D would necessarily manifest positive influences.

Nuclear Energy and Environmental Quality

The researchers examined the (complex) dependency relationship between public nuclear R&D spending in the ten economies with the largest budgets (Germany, South Korea, Japan, the United Kingdom, France, Russia, China, the United States, India, and Canada) and their environmental footprint [3] (the authors refer to “environmental quality”).

Qualitatively, it is reasonable to suggest that investing heavily in nuclear energy leads to the development of low-carbon technological sectors, with a small land footprint and efficient use of heavy materials (concrete, etc.) [4]. Innovative technologies, such as fourth-generation reactors, offer promising prospects for diversifying the supply of fissile materials and reusing what is currently considered waste (plutonium, minor actinides). In other words, in the long term, the impact on environmental quality is likely to be favorable.

However, the authors also note that it is quite possible for this to result in a globally negative impact: inequality between sectors, mining supply, nuclear proliferation risks through technological transfer, etc. Therefore, the impact of public investment is multifactorial and requires a close examination of the technologies developed, their applications, the related regulations, etc. It is unsurprising, then, that the literature establishes both positive, neutral, and negative effects, thereby motivating further research, including the use of different statistical methods (a brief explanation can be found in the annex at the end of the article). It should be noted that the vast majority of studies reviewed by the authors report a positive impact.

Environmental Benefits of Investing in Nuclear Energy

Broadly speaking, time series data show a negative correlation (each euro invested is correlated with a more or less significant reduction in the environmental footprint) between footprint and public R&D spending for all countries except Canada, supporting conclusions established by the literature. Now, let’s examine, using the quantile-quantile method results (see Method box), the variability of this correlation (which is negative except for Canada) according to variations in footprints and public spending. We will focus on the French, German, American, and Chinese cases for graphical representations (refer to table [5] at the end of the article for results for other countries).

The French, German, and American cases present a typical profile for developed countries. The correlation is strongest (dark blue) for the highest environmental footprints. Intuitively, it is understood that supporting the sector significantly improves the footprint by effectively (in terms of positive impact per euro of public investment) moving away from the most carbon-intensive sectors, or more accurately, by contributing to the substitution of carbon-intensive and polluting production with less impactful production. When the footprint is the lowest, this correlation, although still indicating an environmental benefit to public investment, is weakest.

One could hypothesize a saturation of the potential for environmental quality improvement. At this stage, it would have been interesting to superimpose the time series points on the graphs to link the historical trajectory of the environmental footprint and public R&D investment with the various ideal-typical configurations identified by the statistical analysis. A historical recontextualization is an interesting perspective, particularly to confirm or refute the hypotheses outlined above.

The Chinese case offers an intriguing contrast and suggests a stronger link between statistical analysis and economic context. Indeed, whereas for the three countries mentioned above, this statistical link is significantly negative, except for the low footprint quantiles, the Chinese case is reversed: for the high footprint quantiles, the correlation is significantly positive. This result should be viewed in the context of China’s energy trajectory, a country facing strong demand to support economic growth and employing all available resources: coal, nuclear, solar, etc. [6]. The thesis of some historians of science and technology regarding energy additionality is perfectly illustrated in the Chinese case. Such all-encompassing development necessarily leads to an increased environmental impact, providing a possible explanation for the observed inversion in the correlation between R&D budgets and environmental footprint.

However, one reservation can be made about one of the article’s fundamental hypotheses. This hypothesis suggests that the correlation dynamic is in a stationary state, independent of any future developments. The authors thus have a static view of economic dynamics. It is as if the time series already contain all the information, and all possible states of the world are thus explained. For example, in the Chinese case, one might expect that as pollution reduction (primarily decarbonization) of their economy continues and intensifies, the correlation would shift from strongly positive to strongly negative [7].

Invest, but Invest Wisely

Despite this point, the study offers a unique and detailed view of the impact of public R&D budgets in nuclear energy on the environmental footprint and deserves to be highlighted and considered. To conclude with implications for public policy, we can give the final word to the article’s authors: “To fully realize the positive effects of public R&D investments in nuclear energy on environmental quality, as observed in the majority of countries studied [(9 out of 10)], policymakers should focus on targeted and strategic investments [specifically designed to meet the specific and dynamic needs of their economy]. To do this, priority should be given to funding technologies that demonstrate substantial potential to reduce the environmental footprint. Governments could implement incentives such as tax relief or subsidies for projects that align with environmental quality improvement objectives, focusing on supporting innovations in nuclear technology that are designed to be safer and more efficient.” ■