Bulgarian government votes to restart Belene nuclear power project

Bulgarian government votes to restart Belene nuclear power project
Bulgaria's second nuclear power plant is due to be built on the Danube, which marks Bulgaria's border with Romania.
By Denitsa Koseva in Sofia May 16, 2018

Bulgaria’s government decided on May 16 to formally ask parliament to unfreeze the plan to build the Belene nuclear power plant, and says it will seek a strategic investor, trying to avoid the need for a state guarantee.

Plans to build the Belene power plant were scrapped in 2012, but Sofia was forced to reconsider after Bulgaria was ordered to reimburse over €600mn to Russia’s Atomstroyexport, which had won the contract to build the power plant and already started work. Since then, the project to build the country’s second nuclear power plant has been in limbo.

Prime Minister Boyko Borissov said earlier this month that the government will seek to lift the ban on Belene’s construction in order to be able to launch talks with China National Nuclear Corp (CNNC) on the project.

“The most appropriate option for rational usage of the available equipment for Belene NPP is resuming the activities for searching options for the construction of Belene NPP together with a strategic investor, on a market principle and without state guarantees,” the government said in a statement after its May 16 session.

The parliament has given the government a deadline of end-June to decide how to proceed. Meanwhile, several opposition parties have called on Borissov to abandon the project, claiming that its completion would double domestic electricity prices.

In March, Energy Minister Temenuzhka Petkova said that CNNC had officially confirmed its interest in the construction of Belene NPP. The second potential investor is the European Investment Bank. However, the bank’s interest will depend on the financing plan the government drafts, Petkova said.

Industry experts consider CNNC to be the first potential investor truly independent from political connections within Bulgaria as regards the construction of the Belene NPP.

The following month, Bulgaria’s Deputy Prime Minister in charge of economics Tomislav Donchev said the government had received several letters from interested investors and was ready to consider the privatisation of the project.

According to Democratic Bulgaria, a newly established coalition of opposition parties, the cost of Belene’s construction would be at least BGN21bn (€10.7bn) – an expense that would seriously threaten Bulgaria’s economic stability. The country has so far spent over BGN3bn on Belene.

It is questionable whether Bulgaria needs the new power plant, which if completed will have two 1,000 MW reactors. While it was initially seen as a replacement for the ageing Kozloduy nuclear power plant, in January 2016 Kozloduy signed a contract to extend the lifespan of its two remaining reactors until 2049.

The Institute for Market Economics (IME), a Sofia-based think tank, claims that statistics were manipulated to make it seem that investing into Belene was necessary.

Further controversy came when prosecutors charged three people in October 2016 over a suspect deal to sell nuclear power plant equipment to Atomstroyexport. Former economy and energy minister Petar Dimitrov, along with two former CEOs of state-owned National Electricity Company (NEK), were charged with causing €77.2mn worth of damage to the Bulgarian state.