In typical years, nuclear energy contributes between 18% and 25% of the region’s electricity needs, with even higher reliance during periods of low hydro or wind generation. The abrupt removal of this firm, low-marginal-cost baseload power would lead to a structural gap that cannot be adequately filled by renewables alone without substantial changes in operational frameworks and investment strategies.
The immediate consequence of such a nuclear exit would be a firm capacity deficit. Nuclear facilities typically operate at capacity factors ranging from 85% to 95%, delivering consistent output regardless of weather conditions. To replace the lost energy from 10 GW of nuclear generation, estimates suggest that around 25-30 GW of new wind or 40-45 GW of solar capacity would be necessary. Moreover, these renewable sources cannot replicate nuclear’s contributions to peak security or grid inertia, leading to potential adequacy shortfalls during critical demand periods such as winter evenings or summer heatwaves.
State-owned utilities would bear the brunt of this transition, as their thermal fleets—largely reliant on lignite and coal—would need to increase their operational intensity. Existing plants currently running at 40-55% utilization would face strain as they are pushed toward maximum technical limits. This increased operational pressure could result in higher wear and tear on equipment, unplanned outages, and significantly elevated operational expenditures. The financial implications are stark; annual system costs across South-East Europe could escalate by €8-12 billion depending on fluctuating gas and carbon prices.
Natural gas might initially mitigate some capacity losses, but its role would be limited and fraught with risks. The existing combined-cycle gas plants in the region can only substitute for about 30-40% of the lost nuclear output under maximum utilization. This shift would also heighten fuel import dependency, particularly for non-EU states in the Western Balkans, thereby increasing geopolitical risks associated with energy supply.
Hydropower could offer some degree of relief; however, its current usage is already high and subject to climate variability. In optimal conditions, hydropower may compensate for only 10-15% of the lost output from nuclear sources during wet years. Conversely, in drier years, it would provide minimal support while draining reservoirs more quickly than before—compromising seasonal flexibility.
As renewables expand in response to a nuclear phase-out scenario, they may not stabilize the grid as anticipated. Increased penetration of wind and solar could lead to greater volatility in electricity prices and heightened balancing requirements due to the absence of a stable baseload source like nuclear power. Markets may experience more frequent zero-price or negative-price hours during peak renewable production times followed by sharp price increases when adverse weather conditions arise.
In this context, renewables devoid of storage capabilities risk becoming economically unviable. The compression of merchant revenues during high-output periods will challenge financing models for new projects. Lenders may respond by tightening credit conditions and demanding larger equity buffers from developers.
Balancing capabilities will emerge as a critical function within this altered landscape. The need for fast-responding assets will surge as grids without nuclear inertia require enhanced mechanisms for frequency stabilization and short-duration adequacy management. Projections indicate that South-East Europe will need at least 20-30 GWh of battery storage capacity by the early 2030s—an increase from just a few gigawatt-hours currently available—to effectively address these challenges.
The economic significance of battery storage will also grow substantially; it could account for up to 60% of total renewable EBITDA in a scenario without nuclear power. However, an increased reliance on storage introduces new risks including degradation and cybersecurity threats while raising regulatory concerns regarding market power concentration.
Cross-border trading dynamics will shift dramatically as well; currently stable systems that export reliability may become simultaneous importers during stress events without nuclear support. This change will likely decrease mutual assistance among neighboring countries while reinforcing the necessity for domestic firm capacity.
From a financing standpoint, a transition away from nuclear energy may bifurcate the market into two distinct segments: one comprising optimized renewable energy plus storage portfolios that attract investment despite complexity; the other consisting of state-owned utilities facing heightened residual risk with limited revenue prospects tied to thermal asset management.
In summary, a future without nuclear power in South-East Europe is poised to create a more expensive and volatile energy landscape marked by financial polarization between public utilities burdened with adequacy responsibilities and private capital focusing on balancing opportunities rather than traditional energy supply roles. This transformation underscores an essential truth: decarbonization efforts that do not incorporate firm low-carbon baseload options merely shift risk within the energy system rather than eliminate it entirely.
