Банкеръ Weekly

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CANDIDATE-LIQUIDATORS HANG AROUND KOZLODOUI N-PLANT

An almost hysteric discussion has been going on in the past three weeks about the future of the Kozlodoui N-plant. However, the fate of its small units 1 and 2 is still unclear. According to Bulgaria's commitments, these two generators should be decommissioned by end-2002 (i.e. in less than three months). There is an easy explanation to the silence of the politicians - this problem provides no political dividends, since each of the big parties contributed to the liquidation of units 1 and 2. Initially, there were the protests and declarations of the green parties at the dawn of democracy. Then, there was the agreement signed by Lyuben Berov's government in 1993 (and approved by both the Bulgarian Socialist Party and the Movement for Rights and Freedoms, which stipulated ECU24MN financing in return to the commitment for closing down the two generators in 1996 and 1997. Finally, there was the 1999 Kostov-Verheugen memorandum and the interrupted programme for modernization of the above-mentioned units.In return, the cabinet governed by the UDF-coalition received an invitation allowing Bulgaria to initiate negotiations for accession to the European Union (EU). In the end, there come the present rulers who must fulfil what their predecessors have promised. But they also have to find their own trump to show to the EU officials in Brussels. Since the first two units have already been traded, here come the next two.In the meantime, domestic and mainly foreign companies started distributing the money due for the decommissioning of generators 1 and 2.The amount is considerable. According to experts from the Ministry of Energy and foreign specialists, the process of shutting down the generators will cost some EUR500MN. Moreover, these calculations involve just 46 of all 145 activities needed to stop the exploitation of the nuclear reactors and to make them safe.The calculations do not take into account the lack of world experience and the method chosen by the Energy Ministry for decommissiong the units - the so called deferred decision. In this case, the activites (and the funds necessary for their implementation) are spread over a 30-year period. However, the present calculation only includes what should be done in the first few years after the generators are closed down. According to the Nucleon consulting agency , BGN397MN (some EUR200MN) will be needed in the initial stage.This money will guarantee the safety of the closed reactors in the coming couple of years. Right now, however, the revenues reported by the Kozlodoi N-plant only cover the station's own expenses as well as the payments to the two nuclear safety funds. Indeed, by the year-end the funds will have accumulated BGN300MN, but BGN50MN will be the highest amount that can be used for units 1 and 2. The Kozlodoui eurofund will provide the station with further EUR34MN. Therefore, EUR140MN will still be missing. No one of the MPs has asked where the necessary finances would come from. Neither have the deputies commented the fact that almost none of the preliminary requirements for closing the reactors has been met. Experts of the International Atomic Energy Agency (IAEA) and of the EU's PHARE programme have pointed out that:* the accumulated radioactive waste has not been processed;* no facility for temporary storage or final interment of the processed nuclear waste has been put in exploitation (which will cost some USD5MN);* no additional storehouse has been provided for exhausetd nuclear fuel (which will cost about USD300MN).Thus, at least EUR320MN should be added to the initially needed EUR200MN. Anyway, this huge amount is to be spent at the Kozlodoui N-plant. Candidates willing to implement part of the work are already submitting applications. Most probably, big foreign companies will be chosen - not only because of their experience in the nuclear energy, but mostly for the fact that part of the EUR500MN will come from the EU and will be spent according to the rules of the EU.In fact, this is how the consultant for the closing of the reactors was chosen. The consortium between the British BNFL and the French giant Electricite de France will be paid EUR7MN of the EUR34MN allocated in the Kozlodoui eurofund.Meanwhile, it is still unclear who will sign the documents that regulate the units' decommissioning. IAEA's experts say the process will cost about EUR800,000. An equal amount will be needed for the project and technical documentation that regulates activities preceding the first stage of taking the reactors out of exploitation. The last two tasks should be dealt with by Bulgarian experts and lawyers, say sources from the Energy Ministry. Otherwise, the texts would not be harmonized with the Bulgarian legislation.Certainly, the process of decommissiong the units will be executed by foreign experts, but they will be supported by Bulgarian energy companies.In the recent months, the biggest ones among them have been restructuring their teams. The most probable winner is Risk Engineering. The company's experience at Kozlodoui (recently, it has taken part in a number of modernizations of the N-plant) is not the only reason for that. Sources familiar with the company associate Risk Engineering with circles close to BSP and Roumen Ovcharov. However, the company was also a favourite at the time of the former station managers and ministry officials.A less probable winner is the Energoproect nuclear section, which quit the privatized company last spring and became an independent juristic person. Its former director, Ivan Hinovski, is among the candidates to receive Kozlodoui money, too. Currently, however, he is applying as an independent consultant and member of the newly-established Bulgarian Energy Forum. Undoubtfully, crowds around the N-plant will grow further. In the meantime, part of the energy experts in Kozlodoui are sending letters to foreign nuclear power stations. Stations that are not going to close their generators.Despite the numerous assurances that no lay-offs have been planned for the next couple of years, units 1 and 2 will be no longer generating electricity. Therefore, qualified nuclear operators are already searching for new jobs.

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