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EU-regulated “green” funds are investing in some of the world’s biggest coal companies that are expanding their operations in contrast to a 2021 UN agreement for countries to reduce their use of the dirty fossil fuel.

European investors hold shares worth at least $65 million in major coal firms across China, India, the United States, Indonesia and South Africa within funds designated as “promoting environmental and social” goals under EU rules, an analysis by Climate Home and media partners found.

Taken together, these companies emit around 1,393 million tonnes of carbon dioxide (CO2) into the atmosphere every year, putting them among the world’s top five polluters if they were a country.

The investments are owned by major financial firms including BlackRock, Goldman Sachs and Fideuram, a subsidiary of Italy’s largest bank Intesa Sanpaolo. Most firms analysed are signatories of the Glasgow Financial Alliance for Net Zero (GFANZ), whose members pledge to align their portfolios with climate-friendly investment.

The asset managers told Climate Home their coal holdings do not contradict EU green policies or the 2015 Paris Agreement to tackle climate change.

At the COP26 UN climate summit in Glasgow in 2021, countries agreed for the first time to accelerate efforts “towards the phase-down of unabated coal power”. “Unabated” means power produced using coal without any technology to capture, store or use the planet-heating CO2 emitted during the process.

But rather than shrinking, global coal capacity has grown since the signing of the Glasgow Climate Pact with a fleet of new coal plants firing up their boilers, primarily in China, India and Indonesia. Coal miners in those countries have also boosted their operations to keep up with the increasing demand.

European leaders have heavily opposed this, with EU president Ursula von der Leyen saying the bloc is “very worried” about coal expansion in China.

“Light green” funds

The investments analysed by Climate Home have been made by funds classified under Article 8 of the EU’s Sustainable Finance Disclosure Regulation (SFDR), which the European Commission hoped would discourage greenwashing and promote sustainable investments when it was introduced in 2021.

Article 8 – known as ‘light green’ – refers broadly to a fund that has “environmental and social characteristics”, while the ‘dark green’ Article 9 refers more directly to sustainability.

The rules were also intended to offer members of the public more clarity on where asset managers invest their money and enable them to make an informed decision on whether they want their savings or pension pots to prop up climate-harming activities.

coal mining china

Workers shovel coal onto a truck at a coal yard near a coal mine in Huating, Gansu province, China. REUTERS/Thomas Peter

But a group of European financial market watchdogs warned this month the rules are having the opposite effect and called for an overhaul of the system.

“Status as ‘Article 8’ or ‘Article 9’ products have been used since the outset in marketing material as ‘quality labels’ for sustainability, consequently posing greenwashing and mis-selling risks,” they said in a joint opinion to the European Commission.

“The general public is still being misled when it comes to sustainable funds,” Lara Cuvelier, a sustainable investments campaigner at Reclaim Finance, told Climate Home. “The regulations are very weak and there is no clear criteria as to what can or cannot be included. It’s still in the hands of investors to decide that for themselves.”

Funding coal expansion

Climate Home identified investments in the biggest-polluting companies in the coal sector as part of a wider investigation led by Voxeurope, which tracked holdings by funds that disclose information under the EU’s sustainable finance directive.

These “green” funds include investments in mining companies like Coal India and China Shenhua – the respective countries’ top coal producers – and Indonesia’s Adaro Energy, as well as in giant coal power producers such as NTPC in India and China Resources Power Holdings.

All of these companies are planning large-scale expansions of their coal output, according to the influential Global Coal Exit List compiled by German NGO Urgewald.

No new coal mines, mine extensions or new unabated coal plants are needed if the world is to reach net zero emissions in the energy sector by 2050 and keep the 1.5C warming limit of the Paris Agreement “within reach”, according to projections by the International Energy Agency (IEA).

State-owned Coal India is the world’s largest coal producer, with fast-growing output topping 773 million tonnes in the latest financial year. It is targeting 1 billion tonnes of annual coal production by 2025-26 by opening new mines and expanding dozens of existing ones.

IEA calls for next national climate plans to target coal phase-down

In its latest annual report, Coal India cited “pressure of international bodies like [the] UN to comply with [the] Paris Agreement” as one of the main threats to its business. Coal India’s share value has more than doubled over the last 12 months on the back of stronger coal demand in the country, as extreme heatwaves have fuelled the use of air-conditioning among other factors.

State-run mining and energy giant China Shenhua plans to invest over $1 billion in 2024 to expand its fleet of coal power stations and build new coal mines. “We will keep a close eye on climate change to improve the clean and efficient use of coal,” its latest annual report said.

Big investors

The funds with stakes in those coal-heavy companies are managed by Fideuram, an arm of Italy’s largest bank Intesa Sanpaolo, US-based AllianceBernstein and Mercer, a subsidiary of the world’s largest insurance broker Marsh McLennan.

Coal investments in Fideuram’s Article 8 funds – worth at least $16 million – also appear to breach the company’s own coal exclusion policy, designed to rule out holding shares in certain coal firms.

Two of its flagship “emerging markets” funds claim to promote environmental and social characteristics including “climate change prevention” and the “reduction of carbon emissions”, according to information disclosed under EU rules. To achieve their ‘green’ objectives, the funds claim to exclude any investment in companies “deriving at least 25% of their revenues” from the extraction, production and distribution of electricity connected with coal.

But Climate Home found the funds include investments in at least six major coal companies exclusively or primarily involved in coal mining or power generation.

A coal-fired power plant under construction in Shenmu, Shaanxi province, China, in November 2023. REUTERS/Ella Cao

Fideuram did not answer Climate Home’s questions about the funds’ apparent breach of their own policy. But a company spokesperson said in a written statement that “investments in sectors with high-carbon emissions do not conflict with the objectives of the SFDR, which concern the transparency of sustainability investments, nor with the Paris Agreement, which promotes a transition to a low-carbon economy”.

A spokesperson for Mercer said its Article 8 fund, which holds shares in NTPC and China Resources Power Holdings. has an exclusion policy to avoid investing in companies that generate more than 1% of their revenue from thermal coal extraction. “Based on the data provided by ISS [a provider of environmental ratings], no groups involved breach the 1% threshold, and therefore, the fund is not in violation of its SFDR commitments,” they added.

AllianceBernstein did not respond to a request for comment.

Coal-hungry steelmaking

While excluding investments in so-called thermal coal used for electricity generation, several ‘green’ funds put their money in companies producing coking coal – or metallurgical (met) coal – which is used to make steel.

Goldman Sachs’ Article 8 funds hold shares worth several million dollars in Jastrzebska Spolka Weglowa, Europe’s largest coking coal producer, and Shanxi Meijin in China. BlackRock offers exchange-traded funds (ETFs) tracking indexes that include investments in SunCoke, a leading met coal producer in the US and Brazil, Alabama-based Warrior Met and Shanxi Meijin.

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Reclaim Finance’s Cuvelier said that, up until recently, the focus has been on pushing thermal coal out of investor portfolios because the alternatives to met coal in steel production were “less developed”.

“There are now increasing calls on financial institutions to cover met coal as well in their exclusion policies as alternatives exist,” she added. “It’s becoming very important because there are new projects under development that should be avoided”.

A spokesperson for BlackRock said: “As a fiduciary, we are focused on providing our clients with choice to meet their investment objectives. Our fund prospectuses and supporting material provide transparency as to the methodology and investment objectives of each fund”.

Goldman Sachs did not reply to a request for comment.

Reforms on the horizon

At the end of 2022, the European Commission began a review of the SFDR’s application with a view to updating its sustainable finance rules.

Future reforms may include changes to the ways funds are categorised. “There are persistent concerns that the current market use of the SFDR as a labelling scheme might lead to risks of greenwashing… partly because the existing concepts and definitions in the regulation were not conceived for that purpose,” the Commission said in a consultation paper released last year.

It also indicated that the existing categories under Articles 8 and 9 could either be better defined or scrapped entirely and replaced with a different system. The new Commission, yet to be formed following last month’s elections, will decide if and how to move forward with the reform process.

Lithium tug of war: the US-China rivalry for Argentina’s white gold

Separately, the EU’s market supervisory authority, ESMA, has recently issued guidelines to prevent funds from misusing words like “sustainability”, “ESG” – environmental, social and governance – or “Paris-aligned” in their names. A handful of the funds with coal investments analysed by Climate Home have used those labels.

Under the new guidelines, asset managers wanting to slap climate-friendly labels on their funds will have to exclude companies that derive more than a certain percentage of revenues from fossil fuels.

Climate Home produced this article with data analysis contributions from Stefano Valentino (Bertha Fellow 2024) and Giorgio Michalopoulos. This article is part of an investigation coordinated by Voxeurop and European Investigative Collaborations with the support of the Bertha Challenge fellowship.

(Reporting by Matteo Civillini; additional reporting by Sebastián Rodríguez; editing by Sebastián Rodríguez, Megan Rowling and Joe Lo)

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A COP30 roadmap to inaction or ambition on climate finance?

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Mariana Paoli, from Brazil, is the Global Advocacy Lead at Christian Aid and Iskander Erzini Vernoit, from Morocco, is the Executive Director at the IMAL Initiative for Climate and Development.

Government negotiators in Bonn will discuss in the coming two weeks how to put into practice an idea that emerged from the corridors of the COP29 climate talks: “the Baku to Belém Roadmap to $1.3 Trillion”.

This exercise, that aims to propose approaches for scaling climate finance flows for developing countries to over a trillion dollars per year by 2035, is due to be presented at COP30 in Brazil this November. The origins of its mandate offer insights into its perils – as well as its promise.

Brazil seeks early deals on two stalled issues at Bonn climate talks

Initially, negotiators from the G77+China countries united behind Africa’s call for $1.3 trillion as the replacement for the $100-billion goal for annual mobilisation of climate finance by developed countries for developing nations, set 15 years ago. Faithful to this, some G77 countries originally called for a roadmap to indicate actions that developed countries might take to raise public finance resources for this provision and mobilisation for the Global South.

There were, however, those in the Global North who pushed for a broader, less well-defined $1.3 trillion target that would include other sources and types of finance. These forces ultimately won the day, resulting in a final decision on $1.3 trillion that calls for “all finance” from “all … sources”, establishing a “roadmap” process toward this.

Exceedingly disappointing for the Global South, this new formulation obfuscates the responsibility of wealthy historical emitters to pay their fair share of public finance to tackle a proble they have caused and risks shifting the burden to developing countries.

Loss and damage threat

In this context, the Roadmap to 1.3T has the potential to be a milestone in the global governance of climate finance. Yet it faces risks and opportunities, being essentially at the discretion of Azerbaijan and Brazil as the COP29 and COP 30 presidencies.

There is a very real risk that the Roadmap will fall short of sending a strong signal of what level of ambition is required, in terms of public finance from contributor countries. If that happens, the Roadmap could entrench injustice, increase debt burdens, and delay urgent action on climate change.

In terms of injustice, poorer countries, while largely not responsible for climate change, could face loss and damage of $450 billion-$900 billion per year before 2030, not including the costs of reducing emissions and adapting to global warming.

Loss and damage fund to hand out $250 million in initial phase

Within this, Africa’s nomadic pastoral communities are one real-life example of those whose livelihoods and way of life are being destroyed by the choices of others. The COP29 decision on the new climate finance goal disregarded their needs by not including a target for loss and damage funding, but the Roadmap need not.

Heavy debt burden

The Roadmap must not ignore that external debts are at record highs, with repayment costs now higher than capacities for repayment in two-thirds of developing countries, according to UNCTAD.

In 2023, African governments paid around 17% of their revenues on servicing debts, the highest levels in decades, equalling 15% of African export earnings. By comparison, after the Second World War, inspired by the work of Keynes and others, it was decided to cap Germany’s debt repayments at 3% of its exports earnings, to allow recovery.

In this context, Global South countries may lack the fiscal space to invest in essential climate action – or may prioritise other areas, such as healthcare or education.

COP30 President-designate Andrea Corrêa do Lago is correct in his assertion that there is too often a denial of the economic benefits of climate action – yet Global South countries are not always able to pursue economically beneficial investments. Markets are not always efficient, economic benefits do not always equal revenues for investors , and the cost of capital is higher in Global South countries, heightening the need for support, especially with upfront costs.

Framework to scale up finance

Of course, in addition to underscoring the necessity of rich countries increasing their provision of grant-equivalent public funds for poorer countries, for the reasons cited above, the Roadmap can point to opportunities to build the architecture for scaling finance.

Reforming the international financial architecture is important, but, to achieve this, wealthy countries must relinquish their current hegemony and drop their resistance to reform in the negotiations for a UN tax convention and in those around the potential UN sovereign debt workout mechanism that could be agreed at the upcoming Financing for Development (FFD) Conference in Seville.

Climate shocks and volatile currencies hike debt burden for poor countries

Further additions to the financial architecture could include country platforms, aimed at unlocking finance, particularly private investment – but these require resourcing to administer and will only reaffirm the need for catalytic public resources, whether for technical assistance, project preparation, or making finance more affordable.

Of course, current politics are not conducive to increasing international provision of grant-equivalent finance, with recent short-sighted decisions taking overseas aid even further away from the global target for countries to provide assistance equal to 0.7% of their gross national income, established over fifty years ago, despite public support.

Naturally, Global South countries should not hold their breath waiting for others to come to their senses, but should do what they can, including South-South cooperation.

Bold signal needed

And yet, if global temperature goals are not to slip out of reach, if climate action is to be enhanced and injustice and indebtedness curtailed, richer countries must step up on finance. Will the Roadmap affirm this? The COP presidencies have yet to give a firm indication, though have called for inputs from finance ministers and other key groupings through ongoing consultations.

To be successful, there must be a willingness to depart from the status quo — just as was demonstrated with the Paris Agreement and the UAE Consensus, which set ambitious goals to limit global temperature rise and accelerate energy transition, respectively. Even amid uncertainty, these agreements raised the standard for ambition instead of passively allowing low expectations to go unchallenged.

A comparable approach is now needed for international public finance – the Baku-to-Belem Roadmap must send a bold signal of what is required, lest a key opportunity be lost.

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DeBriefed 13 June 2025: Trump’s ‘biggest’ climate rollback; UK goes nuclear; How Carbon Brief visualises research

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Welcome to Carbon Brief’s DeBriefed.
An essential guide to the week’s key developments relating to climate change.

This week

Trump’s latest climate rollback

RULES REPEALED: The US Environmental Protection Agency (EPA) has begun dismantling Biden-era regulations limiting pollution from power plants, including carbon dioxide emissions, reported the Financial Times. Announcing the repeal, climate-sceptic EPA administrator Lee Zeldin labelled efforts to fight climate change a “cult”, according to the New York Times. Politico said that these actions are the “most important EPA regulatory actions of Donald Trump’s second term to date”.

WEBSITE SHUTDOWN: The Guardian reported that the National Oceanic and Atmospheric Administration (NOAA)’s Climate.gov website “will imminently no longer publish new content” after all production staff were fired. Former employees of the agency interviewed by the Guardian believe the cuts were “specifically aimed at restricting public-facing climate information”.

EVS TARGETED: The Los Angeles Times reported that Trump signed legislation on Thursday “seeking to rescind California’s ambitious auto emission standards, including a landmark rule that eventually would have barred sales of new gas-only cars in California by 2035”.

UK goes nuclear

NEW NUCLEAR: In her first spending review, UK chancellor Rachel Reeves announced £14.2bn for the Sizewell C new nuclear power plant in Suffolk, England – the first new state-backed nuclear power station for decades and the first ever under a Labour government, BBC News reported. The government also announced funding for three small nuclear reactors to be built by Rolls-Royce, said the Times. Carbon Brief has just published a chart showing the “rise, fall and rise” of UK nuclear.

MILIBAND REWARDED: The Times described energy secretary Ed Miliband as one of the “biggest winners” from the review. In spite of relentless negative reporting around him from right-leaning publications, his Department of Energy Security and Net Zero (DESNZ) received the largest relative increase in capital spending. Carbon Brief’s summary has more on all the key climate and energy takeaways from the spending review.

Around the world

  • UN OCEAN SUMMIT: In France, a “surge in support” brought the number of countries ratifying the High Seas Treaty to just 10 short of the 60 needed for the agreement to become international law, according to Sky News.
  • CALLING TRUMP: Brazil’s president Luiz Inácio Lula da Silva said he would “call” Trump to “persuade him” to attend COP30, according to Agence France-Presse. Meanwhile, the Associated Press reported that the country’s environmental agency has fast tracked oil and highway projects that threaten the Amazon.
  • GERMAN FOSSIL SURGE: Due to “low” wind levels, electricity generation from renewables in Germany fell by 17% in the first quarter of this year, while generation from fossil-fuel sources increased significantly, according to the Frankfurter Allgemeine Zeitung.
  • BATTERY BOOST: The power ministry in India announced 54bn rupees ($631m) in funding to build 30 gigawatt-hours of new battery energy storage systems to “ensure round-the-clock renewable energy capacities”, reported Money Control.

-19.3C

The temperature that one-in-10 London winters could reach in a scenario where a key Atlantic ocean current system “collapses” and global warming continues under “intermediate” emissions, according to new research covered by Carbon Brief.


Latest climate research

  • A study in Science Advances found that damage to coral reefs due to climate change will “outpace” reef expansion. It said “severe declines” will take place within 40-80 years, while “large-scale coral reef expansion requires centuries”.
  • Climatic Change published research which identified “displacement and violence, caregiving burdens, early marriages of girls, human trafficking and food insecurity” as the main “mental health” stressors exacerbated by climate change for women in lower and middle-income countries.
  • The weakening of a major ocean current system has partially offset the drying of the southern Amazon rainforest, research published in Environmental Research has found, demonstrating that climate tipping elements have the potential to moderate each other.

(For more, see Carbon Brief’s in-depth daily summaries of the top climate news stories on Monday, Tuesday, Wednesday, Thursday and Friday.)

Captured

Aerosols have masked a substantial portion of historical warming. Chart for DeBriefed.

Aerosols – tiny light‑scattering particles produced mainly by burning fossil fuels – absorb or reflect incoming sunlight and influence the formation and brightness of clouds. In this way they have historically “acted as an invisible brake on global warming”. New Carbon Brief analysis by Dr Zeke Hausfather illustrated the extent to which a reduction in aerosol emissions in recent decades, while bringing widespread public health benefits through avoided deaths, has “unmasked” the warming caused by CO2 and other greenhouse gases. The chart above shows the estimated cooling effect of aerosols from the start of the industrial era until 2020.

Spotlight

How Carbon Brief turns complex research into visuals

This week, Carbon Brief’s interactive developer Tom Pearson explains how and why his team creates visuals from research papers.

Carbon Brief’s journalists will often write stories based on new scientific research or policy reports.

These documents will usually contain charts or graphics highlighting something interesting about the story. Sometimes, Carbon Brief’s visuals team will choose to recreate these graphics.

There are many reasons why we choose to spend time and effort doing this, but most often it can be boiled down to some combination of the following things.

Maintaining editorial and visual consistency

We want to, where possible, maintain editorial and visual consistency while matching our graphical and editorial style guides.

In doing this, we are trying to ease our audience’s reading experience. We hope that, by presenting a chart in a way that is consistent with Carbon Brief’s house style, readers will be able to concentrate on the story or the explanation we are trying to communicate and not the way that a chart might have been put together.

Highlighting relevant information

We want to highlight the part of a chart that is most relevant to the story.

Graphics in research papers, especially if they have been designed for a print context, often strive to illustrate many different points with a single figure.

We tend to use charts to answer a single question or provide evidence for a single point.

Paring charts back to their core “message”, removing extraneous elements and framing the chart with a clear editorial title helps with this, as the example below shows.

This before (above) and after (below) comparison shows how adding a title, removing extraneous detail and refining the colour palette can make a chart easier to parse.
This before (above) and after (below) comparison shows how adding a title, removing extraneous detail and refining the colour palette can make a chart easier to parse.

Ensuring audience understanding

We want to ensure our audience understands the “message” of the chart.

Graphics published in specialist publications, such as scientific journals, might have different expectations regarding a reader’s familiarity with the subject matter and the time they might be expected to spend reading an article.

If we can redraw a chart so that it meets the expectations of a more general audience, we will.

Supporting multiple contexts

We want our graphics to make sense in different contexts.

While we publish our graphics primarily in articles on our website, the nature of the internet means that we cannot guarantee that this is how people will encounter them.

Charts are often shared on social media or copy-pasted into presentations. We want to support these practices by including as much context relevant to understanding within the chart image as possible.

Below illustrates how adding a title and key information can make a chart easier to understand without supporting information.

This before (left) and after (right) comparison shows how including key information within the body of the graphic can help it to function outside the context of its original research paper.
This before (left) and after (right) comparison shows how including key information within the body of the graphic can help it to function outside the context of its original research paper.

When we do not recreate charts

When will we not redraw a chart? Most of the time! We are a small team and recreating data graphics requires time, effort, accessible data and often specialist software.

But, despite these constraints, when the conditions are right, the process of redrawing maps and charts allows us to communicate more clearly with our readers, transforming complex research into accessible visual stories.

Watch, read, listen

SPENDING $1BN ON CLIMATE: New Scientist interviewed Greg de Temmerman, former nuclear physicist turned chief science officer at Quadrature Climate Foundation, about the practicalities and ethics of philanthropic climate-science funding.

GENDER HURDLES: Research director Tracy Kajumba has written for Climate Home News about the barriers that women still face in attending and participating in COPs.

OCEAN HEATWAVES: The New York Times presented a richly illustrated look at how marine heatwaves are spreading across the globe and how they affect life in the oceans.

Coming up

Pick of the jobs

DeBriefed is edited by Daisy Dunne. Please send any tips or feedback to debriefed@carbonbrief.org.

This is an online version of Carbon Brief’s weekly DeBriefed email newsletter. Subscribe for free here.

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Chart: The rise, fall and rise of UK nuclear power over eight decades

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The UK’s chancellor Rachel Reeves gave the green light this week to the Sizewell C new nuclear plant in Suffolk, along with funding for “small modular reactors” (SMRs) and nuclear fusion.

In her spending review of government funding across the rest of this parliament, Reeves pledged £14.2bn for Sizewell C, £2.5bn for Rolls-Royce SMRs and £2.5bn for fusion research.

The UK was a pioneer in civilian nuclear power – opening the world’s first commercial reactor at Calder Hall in Cumbria in 1956 – which, ultimately, helped to squeeze out coal generation.

Over the decades that followed, the UK’s nuclear capacity climbed to a peak of 12.2 gigawatts (GW) in 1995, while electricity output from the fleet of reactors peaked in 1998.

The chart below shows the contribution of each of the UK’s nuclear plants to the country’s overall capacity, according to when they started and stopped operating.

The reactors are dotted around the UK’s coastline, where they can take advantage of cooling seawater, and many sites include multiple units coded with numbers or letters.

UK nuclear capacity, 1955-2100, gigawatts. Individual plants are shown separately. Source: World Nuclear Association and Carbon Brief analysis.

Since Sizewell B was completed in 1995, however, no new nuclear plants have been built – and, as the chart above shows, capacity has ebbed away as older reactors have gone out of service.

After a lengthy hiatus, the Hinkley C new nuclear plant in Somerset was signed off in 2016. It is now under construction and expected to start operating by 2030 at the earliest.

(Efforts to secure further new nuclear schemes at Moorside in Cumbria failed in 2017, while projects led by Hitachi at Wylfa on Anglesey and Oldbury in Gloucestershire collapsed in 2019.)

The additional schemes just given the go-ahead in Reeves’s spending review would – if successful – somewhat revive the UK’s nuclear capacity, after decades of decline.

However, with the closure of all but one of the UK’s existing reactors due by 2030, nuclear-power capacity would remain below its 1995 peak, unless further projects are built.

Moreover, with the UK’s electricity demand set to double over the next few decades, as transport, heat and industry are increasingly electrified, nuclear power is unlikely to match the 29% share of generation that it reached during the late 1990s.

There is an aspirational goal – set under former Conservative prime minister Boris Johnson – for nuclear to supply “up to” a quarter of the UK’s electricity in 2050, with “up to” 24GW of capacity.

Assuming Sizewell B continues to operate until 2055 and that Hinkley C, Sizewell C and at least three Rolls-Royce SMRs are all built, this would take UK capacity back up to 9.0GW.

Methodology

The chart is based on data from the World Nuclear Association, with known start dates for operating and retired reactors, as well as planned closure dates announced by operator EDF.

The timeline for new reactors to start operating – and assumed 60-year lifetime – is illustrative, based on published information from EDF, Rolls-Royce, the UK government and media reports.

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Chart: The rise, fall and rise of UK nuclear power over eight decades

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