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Bulgarian Economy and Energy Minister to brief Moscow on Belene cancellation

Author: The Sofia Echo staff Date: Thu, Mar 29 2012 2173 Views
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Bulgarian Economy and Energy Minister Delyan Dobrev has headed to Moscow to meet prime minister and president-elect Vladimir Putin to brief him on Bulgaria’s decision to cancel the Belene nuclear power station project – and to persuade him to resolve the issue in an amicable way, without court action.
 
Prime Minister Boiko Borissov’s centre-right government announced on March 28 2012 that it was pulling the plug on the protracted Belene nuclear project, and instead would build a gas power facility on the Danubian site while transferring a reactor previously ordered from Russia to the existing Kozloduy nuclear facility.
 
Borissov said that the main reasons for cancelling the Belene nuclear project were the high costs, which could soar in several billion euro, and the lack of a second strategic investor.
 
In Moscow, at a meeting scheduled for March 30, Dobrev – recently promoted to minister after his predecessor Traicho Traikov was axed – along with his newly-appointed deputy Valentin Nikolov also will discuss the South Stream project and ask Moscow to agree to the supply of Russian natural gas at a lower price.
 
The Bulgarian delegation, including Bulgargaz head Dimitar Gogov, will meet – among others – Rosatom chief Sergey Kiriyenko.
 
Bulgarian-language media quoted Nikolov as saying that licensing the site will be the main problem with building the seventh reactor to Kozloduy.
 
Former energy minister Roumen Ovcharov, who was part of the socialist-led coalition government that was in power from 2005 to 2009, a government that strongly pushed Bulgaria’s energy links with Russia and whose former members have been sharply critical of the decision to cancel Belene, said that the process envisaged at Kozloduy would take nine to 10 years.
 
Bulgarian National Radio reported that the European Commission’s view was that Bulgaria, like any other EU country, had the right to decide for itself about its energy resources.
 
A spokesperson for EU Energy Commissioner Guenther Oettinger was quoted as saying that Bulgaria was free to make its own decisions about where to build a new reactor or nuclear plant.
 
The European Commission said that licensing of projects is the responsibility of the Nuclear Regulatory Agency, according to the principles of European directives on nuclear safety and nuclear waste management.
 
Traikov said that the decision to cancel the Belene nuclear power station project was a victory for a common sense and said that for more than a year, this was the decision on which he had insisted.
 
However, according to a report by Bulgarian-language Dnevnik, the problem with gas-powered electric power stations was that the price of the energy generated by them was not competitive.
 
On March 28, Borissov said that the Cabinet had decided to abandon the Belene nuclear power station project and to pay for the first reactor, which would be finalised in October.
 
"We have to pay 140 million euro more for it," said Borissov, adding that Dobrev had been given a mandate to start the procedure of installing the reactor as a seventh unit at Kozloduy, "because at the price of about six billion euro, with the credit resource we are offered – with between 10 per cent and 12 per cent interest, and with six years needed for construction, this power plant will eventually cost about 10 billion euro or 20 million euro.
 
"We cannot afford paying for it and obliging several generations to pay this money is something we cannot do," Borissov said, according to local agency Focus.
 
"At the same time we have this nuclear risk and if something there, in this seismic region, everything will be at Bulgaria’s expense," he said.
 
Borissov said that currently Bulgaria was paying for the most expensive gas in Europe.
 
Asked whether Bulgaria will use Russian gas, if the country builds a gas power plant, Borissov said "it depends".
 
He said that more than 600 million leva had been spent on the "absolutely unprofitable" Belene project.
 
"Why didn’t this project find European or big strategic investors – because it was compromised since its very beginning," he said.
 
"Up to the presentm almost 1.4 billion has been paid for this project and unfortunately we still have to pay a further 500 million credit to a French bank. The interests on this loan are for four years, so far we have paid 102 million leva for the interest alone," Borissov said.
 
Bulgarian President Rossen Plevneliev, who took office in January after being elected on the ticket of Borissov’s party, expressed support for the Cabinet decision on Belene.
 
Plevneliev said that it was the first time that a decision on the issue had been made in a transparent way.
 
Belene would not have solved Bulgaria’s energy efficiency problem, he said.
 
Ivan Kostov, leader of the minority centre-right Blue Coalition and who was Bulgaria’s prime minister for a single term in the late 1990s, said that the decision to abandon the Belene nuclear project was "an exceptional one, because it sends Bulgaria back to the geopolitical orbit of the Euro-Atlantic union".
 
"I would compare today’s decision with another one, made in 1881, when Bulgaria was considering where to direct an important railway to – whether to Europe or to Russia. A Russian banker back then gave money to build it to Russia. But the Bulgarian government acted reasonably and chose the European route. That is comparable to the current situation," Kostov said.
 
The Belene decision was criticised by the minority ultra-nationalist Ataka party, which described the Cabinet decision on Belene as "treason".
 
Senior Ataka MP Pavel Shopov said that the decision on Belene had been taken under foreign pressure and served foreign interests.
 
"Look at the interests of Turkey, which is working on four nuclear power plants, look at Romania, which obviously will continue developing its nuclear energy. The major purpose is, after the decommissioning of units 5 and 6 of Kozloduy, which will eventually happen even if their time-frame of use is extended, Bulgaria to eliminate its last high technology. This is the biggest mistake made in the past 20 years, since the beginning of democracy," Shopov said.
 
According to a report by Russian news agency ITAR-TASS, the head of Russia's nuclear agency Rosatom Sergey Kiriyenko said that he did not think that Bulgaria’s decision to give up on the construction of the Belene NPP project would cause a serious loss to the Russian corporation but he said that much time and efforts had been lost on the project.
 
"With regard to the total volume of the orders to Rosatom, abandoning one nuclear power plant project would not cause a significant loss. However, no small amount of effort and time were spent on it. Of course, it would be a pity if the project remains unimplemented," Kiriyenko said.
 
Kiriyenko said that Russia’s position on the issue was strictly pragmatic.
 
"If Bulgaria decides to build Belene NPP, we will build it. If Bulgaria does not need this project, then we will not implement it," he said.
 
At a meeting on March 28, ambassadors of EU and EU candidate countries in Sofia were briefed on the Belene decision by Foreign Minister Nikolai Mladenov.
 
Mladenov referred to the difficulties in finding a strategic investor, a successful model of investment and sources of funding.
 
He informed them of the Government’s intention to use the reactors that already had been purchased at the Kozloduy nuclear power plant as well as the intention to diversify its systems and supply of nuclear fuel.
 
At the same time, Bulgaria will focus greater efforts on energy efficiency in generation, transmission and energy consumption, Mladenov said.
 

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