Krassen Nikolov is a journalist specialised in judiciary affairs. He works for Mediapool and is a regular contributor for BulgarianPresidency.eu for the six months of the Bulgarian Presidency of the Council of the EU.
Bulgaria, which joined the European Union in 2007, has closed its four 440MW Soviet-era reactors at Kozloduy nuclear power plant under its accession treaty with Brussels and over safety concerns raised by the EU. At present, Kozloduy operates two 1,000MW reactors. Support for nuclear energy is high, and so it has been for the project of a second nuclear power plant at Belene.
Restarting Belene will happen after parliament removes the moratorium imposed six years ago on the construction of the plant. As Borissov’s ruling party GERB commands a majority, together with its junior partner, the United Patriots, this should not be a problem. Just like the United Patriots, the opposition socialists also support nuclear energy.
Chinese interest
Borissov announced his intentions on Saturday (12 May). A day earlier, China National Nuclear Corporation (CNNC) confirmed its interest in implementing the project. The first indications for such an interest date back from 2016.
To balance the geostrategic interests, Bulgaria will also invite the French nuclear company “Framatom”, while the Russian nuclear company “Atomstroyexport” will also participate in the construction as the reactor is its production.
So far, Bulgaria has not decided whether the project will be implemented entirely with private capital, without state guarantee and without long-term contracts for the purchase of electricity.
Key facts
The Belene NPP project was launched in 1981 by a decision of the Bulgarian Communist Party. Then a “Skoda” reactor was bought. Immediately after the 1989 changes, the project was frozen, but the nuclear plant site was preserved. Nearly 30 years later, the Czech reactor was sold in Russia for about $200 million because it is considered morally obsolete.
In 2002 the government led by Prime Minister Simeon Saxe-Coburg Gotha decided to unfreeze the project. In 2008 Bulgaria commissioned Atomstroyexport to produce a new reactor with a capacity of 2000 megawatts. In 2012, Borissov’s first GERB-led government imposed a parliamentary moratorium on the project, arguing that it was unprofitable for Bulgaria.
In 2013, a referendum on the development of nuclear energy in Bulgaria was held at the initiative of BSP. With 60.6% against 37.3% Bulgarians voted in support of nuclear energy. However, the referendum was not considered as binding, because of low turnout.
In 2016 Atomstroyexport won a lawsuit against Bulgaria at an international arbitration tribunal. Sofia is obliged to pay €620 million for the nuclear reactor vessel. Thus the Bulgarian authorities got a reactor vessel without any real idea what to do with it.
Since the unfreezing of the project in 2002 Belene NPP has cost the Bulgarian taxpayers €1.5 billion. The completed plant will cost at least €10 billion. The cost of electricity is calculated between €80 and €90 per megawatt hour. For comparison, the cost of electricity from the currently operating Kozloduy NPP is about €30 per megawatt hour. The Bulgarian authorities have yet to give a convincing answer to the question why a new nuclear power is needed.
Scandals
Belene NPP is one of the most scandalous projects in Bulgaria’s latest history. In October 2016 the Prosecutor’s Office filed charges against four high-ranking officials for alleged crimes under the Belene NPP project.
Former Energy Minister of GERB and current MP Delyan Dobrev was accused of ignoring the Belene NPP moratorium and continuing the payments to the participants in the project.
The former executive directors of the National Electric Company Lyubomir Velkov and Mardik Papazyan were accused of having caused prejudice to the amount of €77 million with the sale of the old Skoda reactor.
Former minister of economy, energy and tourism from the Bulgarian Socialist Party Petar Dimitrov was also accused of not exercising control over the leadership of the National Electric Company. However, there is no development in neither of these cases.
In 2012 Bulgarian Prime Minister Boyko Borissov called ironically the site of Belene “a swamp”. It remains unclear why six years later the swamp turned into a “strategic project” for him.
The new plans
Energy Minister Temenujka Petkova promises to present to the National Assembly the possible options for Belene NPP within a few days. Parliament is expected to give the government a mandate to privatize the project or attract a strategic investor.
Bulgaria will have no problem with the European Commission because the project has already passed the necessary procedures and the site is licensed.
Petkova explained that one of the options for the construction of the plant is on the financial model of the Hungarian NPP Paks II – Russia is providing the major part of the funding with the approval of Brussels. The loan will then be returned from the plant’s operations. In the case of Belene the problem is Bulgaria’s reluctance to give state guarantees.
The chairman of the Bulgarian Energy and Mining Forum Ivan Hinovski explained that the CNNC wanted to participate in the project with its technology.
“According to my information, the Chinese are planning an expansion to sell electricity to EU countries, and this is based on their reactors, which are much cheaper than the Russian ones”, Hinovski said.
He added that the Chinese company would buy the Belene equipment, but that it would also build there 2 or 4 reactors based on their technology.
However, this information hasn’t so far been confirmed by official sources.
According to Hinovski, the Chinese interest has caused “serious turmoil” to the Bulgarian nuclear lobby, because of the sudden appearance of a “non-system player”, who has no undercover connections with the Bulgarian authorities.
The chairman of the energy regulator Ivan Ivanov also questioned the project on the account of the high price of the electricity it would produce. He pointed out that the production of 1 megawatt hours of energy from photovoltaic power plants in the US costs $50, and for wind farms the price is $40. Moreover, he said the price electricity from renewable sources was constantly decreasing, while the price of nuclear electricity was increasing.
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