Short-term gains, long-term risks: transmission channels of procurement, competition and governance in nuclear energy

Purpose The empirical analysis investigates the transmission channels of gross nuclear heat production (NUC), serving as an indicator of potential environmental risk exposure due to the long-term hazards posed by radioactive waste. Drawing on a panel spanning 12 EU countries and the United Kingdom from 2000–2019, the study addresses a critical omission in previous research regarding the spatial interdependence and heterogeneity of institutional and regulatory conditions influencing NUC across borders. Design/methodology/approach Methodologically, the study aims to capture the delayed effects of these reforms by integrating the ECT. Spatial Durbin models (SDMs) with both fixed effects (FE) and random effects (RE) alongside quantile regression models (QRMs) are also employed. Endogeneity concerns are addressed through pairwise Dumitrescu–Hurlin panel causality tests. Findings Non-competitive procurement practices show a positive short-term relationship with NUC by expediting project approvals, but the benefits diminish over time, with long-term inefficiencies and corruption risks. Large public procurement contracts provide immediate boosts to nuclear development but lack a sustained impact. The study also reveals significant spatial spillover effects, where the nuclear policies of one country influence neighboring countries, highlighting the importance of cross-border coordination. Research limitations/implications However, caution is important when interpreting the empirical results of our investigation, as the focus on the EU's geographic scope may limit the extent to which the findings can be applied to other areas. Practical implications Policy implications emphasize the need for EU-wide regulatory harmonization, transparent procurement processes and stronger financial oversight to address the challenges posed by non-competitive practices and offshore financial flows. Public participation in governance constrains NUC expansion, as higher public opposition often leads to policy reversals and greater emphasis on renewable energy. This underscores the necessity for a coordinated EU strategy that balances public concerns with long-term sustainability goals. Originality/value The contribution of the present research is centered on exposing the significant risk that short-term procurement strategies pose for long-term clean energy future. It demonstrates that while non-competitive procurement practices provide short-term gains by expediting project approvals, this efficiency undermines long-run institutional and governance credibility. Conversely, robust, stable regulatory quality is essential for fostering sustained investment. Therefore, the findings recast the governance challenge, highlighting that sustainable nuclear pathways require transparent, spatially coordinated regulatory frameworks that prioritize institutional longevity over rapid, short-term implementation gains.