Kozloduy and Belene – Bulgarian nuclear decline

Boom and bust

The nuclear lobby in Bulgaria is losing its grip on Belene. Ever since it became clear that successive Bulgarian governments had been spreading unrealistically optimistic numbers about the construction costs of Belene, the trust in the project has nose-dived. Twelve banks have abandoned their initial interest. The world's number one nuclear bank, BNP Paribas, saw the 250 million Euros it had raised for a start-up loan squandered on consultants and over-priced demolition work. Tens of millions of these Euros are still unaccounted for. When the financial crisis hit Bulgarian utility NEK, BNP Paribas decided to call in the loan early. In the last three years, no other financier has expressed any interest in Belene.

PHOTO: Greenpeace

One of the most hard-nosed nuclear utilities in Europe, RWE from Germany, was also unable to raise money for its own 49 per-cent participation in the project and eventually withdrew in October 2009 after discovering that Belene was marred by corruption, that financial numbers were tweaked to create optimism, and that there were considerable safety and seismic risks at the plant. After RWE's withdrawal, Bulgarian taxpayers are burdened with full costs of the project via state utility NEK’s 100 per-cent share (not 51 per cent as Ms Georgieva Aleksandrova writes).

Who will pay?

The only partners that still have a direct interest in the project are Russian. Atomstroyexport, export branch of the Russian nuclear giant Rosatom, holds the Belene construction contract and has already gambled hundreds of millions of Euros in the early stages of the project, including in the production of large parts such as steam generators. Rosatom hoped that Belene would be its entry point into the EU market. Now Rosatom is trying to salvage Belene. It is offering a loan for the first two years of construction. This was originally announced as four billion Euros, but on February 15 was downgraded to two billion Euros – a decrease that clearly indicates that even the Russians are getting cold feet. And with the total cost estimated at 10 billion Euros, the question is who will pay the rest?

In the article on Kozloduy and Belene, Georgieva Aleksandrova further writes that “Bulgaria does not want to take up huge loans”. But Bulgaria has no choice. It is not allowed to invest state money in the project, as this would be in breach of EU free market rules. In any case, Finance Minister Dyankov announced on September 18 that the Bulgarian budget would not be able to take on such a risky investment. With previous attempts to raise money falling flat on their face, being burdened with debt already and having only a relatively small amount of assets, NEK can also not afford such a large investment.

Kozloduy is expected to be cheaper than Belene, because the infrastructure is already there. But if we look at a comparable project, the two Westinghouse AP1000 blocs at Vogtle in the US, these also are expected to cost around 10 billion Euros for around 2,000 MW, despite a government loan covering 70 per cent of the cost. Kozloduy is a long way from receiving such support.

The road to energy independence

Let us face it – besides the nuclear waste problem, the security risk and the impact of devastating uranium mining – nuclear power has priced itself out of the market. Already today, the combination of energy efficiency and decentralised renewable energy sources can deliver cheaper around-the-clock energy. Nuclear power is in fast decline. In 2008, no new nuclear reactors came online, but wind energy alone added the output equivalent to the one of eight large nuclear power stations. In 2009, new wind projects around the globe added the electricity output to the grid which is equivalent to that of 12 large nuclear power stations. Only two nuclear reactors were started up, while four were taken off the grid. In spite of all the talk of a 'nuclear renaissance', the trends are clear.

Bulgaria will not achieve energy independence by wasting time and money on an industry in decline, instead of developing its potential in energy efficiency and renewables. For now, Bulgaria continues to be attracted to nuclear energy like a moth to fire.

Greenpeace is an independent organisation working around the globe to save this planet for future generations. It does not accept financing from governments or corporations. Jan Haverkamp (50) has a background in environmental sciences, biochemistry, nuclear physics and communication psychology. He has been campaigning in Eastern Europe since 1987 and has been following the Belene project since 2002. He currently lives and works between Prague and Brussels.

Jan Haverkamp, Greenpeace EU Dirty Energy Policy Advisor