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European Commission Opens State Aid Probe Into France's EUR 73 Billion Nuclear Reactor Plan Investigation into subsidies for 10 gigawatts of new nuclear capacity threatens to delay atomic ambitions as power demand surges. The European Commission launched an investigation Tuesday into France's plan to subsidize six new nuclear reactors with a total capacity of 10 gigawatts, throwing regulatory uncertainty over a project estimated to cost EUR 73 billion. The probe examines whether France's proposed subsidy scheme for construction and operation of the reactors complies with state aid rules. The timing matters for European power markets facing unprecedented demand growth. Data centers alone are projected to consume 35 gigawatts of power by 2030, more than double the 17 gigawatts used in 2022, according to industry analysts. Investment in data center infrastructure reached USD 197 billion in 2024, with the sector seeing 209 deals worth over USD 48 billion in 2021, up roughly 40 percent from USD 34 billion in 2020. France's nuclear expansion comes as the country works to maintain its position as Europe's largest power exporter while replacing aging reactor capacity. The country already operates the ITER fusion research complex in southeastern Provence, the world's largest international effort to prove fusion can multiply energy tenfold, though commercial fusion remains decades away. State aid investigations by the European Commission typically take months to complete and can result in modifications to subsidy structures or outright rejection of financing schemes. The outcome will determine whether France can proceed with its atomic build-out on the current timeline or face delays that could tighten power supply across Western Europe. The regulatory uncertainty arrives as France navigates seasonal challenges to nuclear output. Meteorological forecasters expect frequent rainfall and thunderstorms this summer that may reduce disruption risks to nuclear generation from cooling water constraints. June could be the sunniest and warmest month, but periodic cooling may limit temperature-related output cuts that have plagued French reactors during previous hot summers. The 10 gigawatts of new capacity would represent a substantial addition to France's nuclear fleet. Any construction delays would extend the timeline for adding baseload generation at a moment when European power markets are pricing in tighter supply-demand fundamentals driven by data center growth and industrial electrification. Cross-border power flows remain sensitive to French nuclear availability. When French nuclear output falls, domestic power prices rise while German prices typically follow higher on reduced exports from France. Natural gas demand for power generation increases accordingly, supporting prices at the Dutch TTF hub. Beyond Europe, geopolitical tensions continue reshaping energy flows. Iran has tightened control over the Strait of Hormuz following conflict escalation with the United States and Israel, bringing maritime traffic to a virtual standstill and giving Tehran significant leverage over global oil and gas supplies. The strait serves as a critical artery for hydrocarbon exports from the Persian Gulf. United States sanctions against Iran, administered by the Office of Foreign Assets Control within the Treasury Department, have been in place since the 1979 revolution when President Carter imposed restrictions after students seized the American embassy in Tehran. The sanctions regime has expanded to cover economic, trade, scientific and military activities. The intersection of nuclear policy, power demand growth and geopolitical risk creates multiple pressure points for European energy security. France's ability to expand atomic capacity depends first on clearing the Commission's state aid review, a process with no guaranteed timeline or outcome. The investigation's resolution will signal whether European regulators view subsidized nuclear construction as compatible with single market rules or whether France must restructure its financing approach. Power traders will watch for any indication the probe could delay reactor construction timelines, which would extend the period of tight French generation margins before new capacity arrives.