Nuclear Power: Mickey Mouse climate solutionIn 2009, multinational financial services corporation Citigroup called nuclear power – with its skyrocketing costs, disastrous economics and dependence on public bailouts – a “corporate killer”. Now, in 2011, are we witnessing the slow death of one of the world’s largest nuclear companies?

French nuclear giant AREVA, which designs, builds (or at least tries to), and exports nuclear reactors is in financial trouble. Big trouble.

On December 13th, it announced that this year it made a loss of 1.6bn euros (US$2.1bn), and that it  is sacking up to 1,500 workers in Germany, reducing jobs through attrition in France, freezing wages, and selling some assets while reducing the value of others. AREVA will also cut its dividends to investors and its global investment for the next four years by a third. Not only that, the company is suspending its interests in uranium enrichment in the US, investment in uranium mining in Africa, and its projects to expand the output of nuclear reactors in France.

So, what is happening to AREVA? Simply put, with the likes of Germany, Belgium, Italy and Switzerland turning their backs on nuclear power, and public opinion hardening against nuclear power in the aftermath of the Fukushima disaster (not least in AREVA’s native France), the company is facing a fast dwindling number of countries willing to buy its massively expensive and incredibly complex nuclear reactors.

You see, AREVA’s nuclear arm just isn’t really very good at what it does. It’s currently building – not very successfully - four of its much-hyped next generation EPRs (European Pressurised Reactors) in Finland, France and China. The Finnish and French reactors are years behind schedule and billions of euros over budget. Meanwhile, the two EPRs being built in China are suffering the same construction defects and safety concerns that have made the European EPRs such a joke.

It’s a classic case of hubris meeting nemesis. AREVA bet the farm by hoping it would sell 50 new nuclear reactors this decade. It hasn’t received a single order for a reactor since 2007. Apart from the UK, whose own nuclear plans are increasingly delayed, nobody in Europe wants to buy AREVA reactors. AREVA hopes to sell the EPR to India but the country’s nuclear power ambitions are currently strongly opposed by the public and arguments about who pays for the damage and clean up in the event of a nuclear accident (here’s a clue: the nuclear industry doesn’t want to.)

Add to that the global financial situation (there has yet to be a nuclear reactor anywhere in the world built without public cash which is in short supply right now) and it doesn’t add up to a recipe for nuclear success. Renewable energy sources such as solar and wind get cheaper, more efficient every day and offer us a sustainable future while nuclear gets more expensive, troubled and can’t help in the fight against climate change in any meaningful way.

As noted by Citigroup, the smart money doesn’t see a future for nuclear power. AREVA’s future isn’t entirely bleak, if it makes some strategic businesses changes. The company has a renewables arm that specialises in solar and wind energy, biomass, and hydrogen power technologies. By ditching the failing nuclear side of its business and fully devoting its resources to renewables, the company could yet salvage its reputation and its profits.