Bulgaria Economy Minister defensive over Westinghouse promise

Bulgaria Economy Minister defensive over Westinghouse promise


By Alex Bivol

Mere days after returning from a trip to the US, during which he met representatives of several corporations to discuss projects in the energy sector, Bulgarian Economy Minister Dragomir Stoynev had to go on the defensive concerning the apparent agreement struck with US firm Westinghouse to build a new unit at Bulgaria’s Kozloduy nuclear plant.

Bulgaria’s Government is expected to make a decision on Kozloduy’s planned unit 7 before the end of the year. Last year, it picked Westinghouse to carry out the feasibility study, ahead of a consortium between French Areva and Japan’s Mitsubishi, as well as another consortium between Australia’s WorleyParsons and local Risk Engineering (the latter are the main consultants on Bulgaria’s proposed Belene plant, frozen by Government and Parliament decisions in 2012).

Although the results of the feasibility study have not been made public yet, Stoynev said after returning from the US that he would propose that the Cabinet gives Westinghouse the task to build the new unit, using the AP1000 reactor design.

Stoynev said that there was no need to hold a public tender to pick the contractor, citing that other European Union member states – including the UK, France and Finland – had made similar decisions in the past, public broadcaster Bulgarian National Radio (BNR) reported. Speaking to BNR on November 24, Stoynev said that a large part of the funding would come from the Export-Import Bank of the United States, but gave no further details.

“For me, personally, I think that the important part is that this new generation of nuclear reactors happens in Bulgaria and I do not believe that we need a tender,” he was quoted as saying.

Stoynev came under criticism from Democrats for a Strong Bulgaria (DSB), one of several out-of-Parliament parties that form the opposition Reformist Bloc. DSB leader Radan Kanev said on November 25 that the deal with Westinghouse was “an American Belene” – a reference to the Belene project that the party opposes.

(Although Russia’s Atomstroyexport was picked to build two 1000MW units at Belene following a tender, observers have said that the outcome had been never in doubt as soon as Bulgaria restricted the possible reactor technology to the Russian VVER design.)

Kanev said that should the Cabinet endorse Stoynev’s proposal, Bulgaria would be breaching several rules – the one requiring a public tender, the need to get approval from the European Commission, while the state guarantees for the construction of the new unit could be ruled as illegal state aid and sanctioned by the EC.

He said that Stoynev’s announcement lacked salient details on the costs of the project, the price of electricity produced there, as well as the future of spent nuclear fuel.

Bulgaria’s largest opposition party, GERB, levelled the same criticism in a statement on November 25. The party said that it would notify European energy commissioner Guenther Oettinger of the Cabinet’s intention to “take decisions in the dark and without tender, in breach of European regulations”.

Stoynev said that he planned to make the proposal to the Cabinet in early December. If passed, preparation could begin as early as January, with actual construction work starting in 2016. The new unit would have a life cycle of 60 years, which could be further extended by another 20 years, he said.

Kozloduy currently has two Soviet-built 1000MW reactors, whose life cycles expire later this decade, but Bulgaria hopes to extend them by another 10 years. Four smaller units, totalling a combined power of 1760MW, have been shut down in 2005 and 2006 as a pre-requisite for Bulgaria’s accession to the European Union in January 2007.