Nuclear Dream for 130 Billion Euros: Eastern Europe Seeks Money for Nuclear Power Plants

Luc Williams

Compared to Western countries Nuclear energy in the countries of post-Soviet Europe has a small share in the energy mixbecause due to the explosion at the Chernobyl power plant in 1986, the implementation of nuclear projects in Eastern Europe slowed down during Soviet times. Then came the fall of the communist regimes, which again stopped the development of nuclear energy in this region.

Now, as the west of the continent focuses on modernizing or replacing old reactors, the east is uniting in the biggest push in decades to increase nuclear capacity.

The biggest project of the century for 130 million euros

Countries in Eastern Europe are developing plans for what some are calling the biggest project of the century. The latest forecasts compiled by Bloomberg show that onAt least a dozen new nuclear power units are to be built in the east for almost 130 billion eurosThe first could be operational within a decade.

Plans to build new reactors in Eastern Europe / Bloomberg

After the fall of the Iron Curtain, the former communist states largely inherited existing plants from the 1970s and 1980s. However, these have been operating for much longer than they should have. In this situation, governments are using political support to build new facilities.

But According to officials, countries lack engineering expertise and have difficulty financing their ambitious plans. And since no private investor will take on the risk of building a new nuclear power plant on their own, governments must step in. In this game, European Union subsidies will be key, but there will also be competition for this money.

“Funding is by far the most important issue,” Nuclear Energy Agency economist Jan Horst Keppler told a room full of energy executives from Eastern Europe at a June meeting in Prague.

Western Europe’s Mixed Nuclear Landscape

Meanwhile, the picture in Western Europe is mixed. Belgium and Spain are planning to phase out nuclear power, although the deadline for ending reactors was pushed back after Russia invaded Ukraine due to concerns about energy supplies. Austria rejected nuclear power in a 1978 referendum. Germany opted to phase out nuclear, a move made by the German government after the Fukushima disaster in Japan in 2011.

Belgium, France, Finland and Sweden continues to meet at least one third of its energy needs from reactors for a total of more than 100 million citizens. The EU’s newest reactor, Olkiluoto 3, located in Finland, began generating power last year. France’s newest power plant will begin producing electricity this summer at its Flamanville-3 EPR reactor.

Nuclear energy production in EU countries in 2022 / Bloomberg

Nuclear power plants are an expensive investment

Although government subsidies for new reactors will almost certainly receive EU approval, their scale is dauntingTake Poland, for example, whose energy production was dominated by coal, and the new nuclear power plants would be the first in the country.

The Polish government is conducting difficult negotiations over the financing of Westinghouse Electric reactors intended for the country’s first power plant. The cost of the reactors could exceed $30 billionwhich is equivalent to the country’s entire defense budget for 2023, or 3.9 percent of gross domestic product.

Eastern European countries do not expect investment decisions to be made anytime soon. They are waiting for the EU to approve aid under the 2028-2034 budget cycle, which is likely to be approved in June next year. The EU’s green energy plans also include nuclear power.

Eastern Europe plans nearly €130 billion in nuclear spending, with new projects announced across the region / Bloomberg

In order not to wait for EU subsidies, Poland could consider concluding a so-called contract for difference, which is a form of state subsidy used by Electricite de France and the UK government for their projects.

Romania sets up special purpose vehicle and considers green bond merger, and state loans, said Vasile Dascalu, financial director at state-owned Nuclearelectrica.

The Czechs will decide by the end of August which company will be the supplier of at least one reactor.Deputy Minister of Economy and Trade Tomas Ehler said at a June meeting in Prague that government loans would likely cover 90 percent of the project costs.

Currently, the only new nuclear power plants under construction in the EU are in Slovakia and Hungary, where Russia is financing the construction of the Paks II nuclear power plant by Rosatom Corp., the world’s dominant supplier of nuclear fuel.


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