EU policy

Lawyers working with the campaigning group Energy Fair say that some existing and proposed new subsidies for nuclear power in the UK may be unlawful under EU laws designed to promote fair competition between businesses. A formal complaint about those subsidies is now being prepared for submission to the European Commission.

The law firm BBH is working with Energy Fair in preparing the formal complaint to the European Commission. The legal team is led by Dr Dörte Fouquet. She is a senior partner in the firm and is also Director of the European Renewable Energies Federation.

The planned action by Energy Fair, to make a formal complaint to the European Commission about subsidies for nuclear power, is endorsed by the following people and organizations: Tom Burke CBE, Campaign for Nuclear Disarmament, Eurosolar, Jean Lambert MEP, Caroline Lucas MP, Nuclear Free Local Authorities, Michael Meacher MP, People Against Wylfa B (PAWB), Jonathon Porritt CBE, Dr Jeremy Leggett and Solarcentury, Sortir du Nucléaire, Keith Taylor MEP, and Urgewald.

“Our research is in line with what others have been saying” says Dr Gerry Wolff, Coordinator of the Energy Fair group. “MPs have already raised concerns about provisions in the recent Finance Act that will produce windfall profits for the nuclear industry. The Government itself says that the industry will benefit by £50 million per year, and calculations by WWF and Greenpeace show that the subsidy could be as much as £3.43 billion between 2013 and 2026”.

Forms of support for nuclear power
Research by the Energy Fair group has identified 9 existing or proposed subsidies for nuclear power and 2 potential subsidies. Withdrawal of any one of them, via legal or political action, is likely to make new nuclear power plants uncompetitive.

They are described in the reports “Nuclear Subsidies” and “Subsidies for nuclear power in the UK government’s proposals for electricity market reform” and they are summarised here:

• Limitations on liabilities: The operators of nuclear plants pay much less than the full cost of insuring against a Chernobyl-style accident or worse.
• Underwriting of commercial risks: The Government necessarily underwrites the commercial risks of nuclear power because, for political reasons, the operators of nuclear plants cannot be allowed to fail.
• Subsidies in protection against terrorist attacks: Because protection against terrorist attacks can only ever be partial, the Government and the public are exposed to risk and corresponding costs.
• Subsidies for the short-to-medium-term cost of disposing of nuclear waste: In UK government proposals, the Government is likely to bear much the risk of cost overruns in the disposal of nuclear waste.
• Subsidies for the long-term cost of disposing of nuclear waste: With categories of nuclear waste that will remain dangerous for thousands of years, there will be costs arising from the dangers of the waste and the need to manage it. These costs will be borne by future generations, but they will receive no compensating benefit.
• Underwriting the cost of decommissioning nuclear plants: In UK government proposals, the Government is likely to bear much the risk of cost overruns in decommissioning nuclear plants.
• Institutional support for nuclear power: the UK government is providing various forms of institutional support for the nuclear industry.
• Exemption from tax. Uranium is exempted from the tax on fuels used for the generation of electricity.
• Feed-in tariffs with contracts for difference. Although it is a mature technology that should not need subsidies, nuclear power would be eligible for the same system of subsidies as is proposed for renewable sources of power.
• Capacity mechanism. The UK government’s proposals for a ‘capacity mechanism’ as a backstop for the power supply system are not yet finalised. However, there is potential for the proposed mechanism to be used to provide unjustified support for nuclear power.
• Emissions Performance Standard. Although nuclear power emits between 9 and 25 times more fossil carbon than wind power, it appears that the effect of the proposed new standard would, for the foreseeable future, be to lump them together as if they were equivalent in their carbon emissions.

The nuclear subsidies are described in the reports “Nuclear Subsidies” and “Subsidies for nuclear power in the UK government’s proposals for electricity market reform” available at:

www.mng.org.uk/nsubsidies and www.mng.org.uk/emrdoc

Source: Pressrelease Energy Fair, 7 November 2011
Contact: Dr Gerry Wolff PhD CEng, Coordinator, Energy Fair, 18 Penlon, Menai Bridge, Anglesey, LL59 5LR, UK.
Email: nuclearsubsidies[at]gmail.com
Web: www.energyfair.org.uk

In the wake of Fukushima, European Union officials pledged to create stress tests for the 143 nuclear power plants in the EU, that would evaluate the threat posed by natural disasters, terrorism, cyberwar and human error. Now it turns out that that  nuclear regulators are unwilling to accept stricter scrutiny and the plans are likely to get watered down.

Western European nuclear regulators are now staunchly rejecting calls for rigorous tests, Süddeutsche Zeitung reported in its May 4 edition. The regulators reportedly stated in an internal paper that they would only agree to conduct stress tests involving natural disaster scenarios -- and not terrorist strikes or other manmade situations. Instead, they would agree to compose reports on potential threats that would be submitted to the European Commission in Brussels. Neither would independent nuclear experts be given access to the plants under the plan.

European Commission sources told the newspaper that France and Britain have led the efforts to oppose more stringent stress tests. With France's 59 plants and Britain's 19, the two operate the largest number of nuclear power plants of any countries in Europe. Government officials in Paris and London have already stated that they plan to rely more heavily on nuclear power in the future despite the Fukushima disaster. Officials in London also stated they would not publish the results of the stress tests, which are expected to be completed by December.

Such a stress tests will not give a comprehensive and transparent risk assessment of the European nuclear installations. If developed in such a way the stress tests will only serve as "alibi tests" so nuclear operators can continue their business-as usual.

On May 11, the European nuclear lobby organisation Foratom said that "Including terrorist attacks or cyber-attacks as stress-test criteria would mean the checks will take more time and authorities won't be able to make the results public." And continued: "Our feeling is that citizens in Europe are waiting for the results and we should announce them without delays. People don't want to make things political and it's

important to prove that nuclear plants in Europe are safe."

Or... people want results now - therefore we should not do stress tests, but simply tell them it's OK...., commented Greenpeace spokesperson Jan Haverkamp

We ask you to take urgent action on this issue! Put pressure on Commissioner Oettinger by writing him an E-Mail expressing your concern and protest. Your protest for a genuine stress test on nuclear power plants in Europe. Go to www.nofaketest.eu.

Sources: www.nofaketest.eu; Der Spiegel, 5 May 2011; Bloomberg, 11 May 2011

EUROPEAN PARLIAMENT DISMISSES CALL FOR "FLEXIBILITY"

(December 15, 2006) The European Parliament stopped on 30 November attempts from Bulgarian and pro-nuclear politicians to create uncertainty about the final closure date of the Kozloduy blocks 3 and 4. With 269 against 264 votes, the Parliament reiterated its call on Bulgaria to close the two blocks before Bulgaria's EU accession on 31 December 2006 midnight.

(650.5767) WISE Czech Republic - Parliament rapporteur on Bulgaria, British MEP Geoffrey van Orden, tabled a text in Bulgaria's EU accession progress report in which he called for flexibility concerning Kozloduy 3 and 4's closing dates. A few days before the EP plenary threw out the text, the Foreign Commission had accepted it, which was extensively covered and celebrated in the Bulgarian press. Already in March of this year, van Orden tried to smuggle a similar text in his progress report. Also this text was voted out by the plenary of the European Parliament.
When talks about EU accession started with Bulgaria in 1998, the country had to promise to close its four VVER 440/230 reactors in Kozloduy as they were considered too unsafe for upgrading. The EU allowed, nevertheless, a phase-out time provided that certain upgrades would be carried out. End 2002, the blocks 1 and 2 were taken from the grid, switched off and mothballed.

Irreversible closing of block 1 and 2
Many Bulgarian politicians and people from the nuclear energy sector, including consecutive directors of the Kozloduy nuclear power plant, did not like the closure of the reactors and sometimes secretly, sometimes very vocally even held hopes for a re-start of the blocks 1 and 2 as soon as Bulgaria would have entered the EU. Last summer, however, the European Commission heavily criticised Bulgaria for not making the closure of block 1 and 2 irreversible and Bulgaria had to promise steps to do so. A request by Greenpeace for information on concrete measures last September was refused and is currently awaiting court decision. On 7 December, the chairman of the Nuclear Regulatory Agency in Bulgaria amended the operation licences of block 1 and 2 so that certain vital components can be removed from the reactor. It is not clear, however, whether this would constitute an irreversible closure.

MEPs as lobby
The Bulgarian media give the impression that there has been a years long debate about whether final closure of Kozloduy 3 and 4 should be postponed. Inspection visits of IAEA and WENRA (a non-governmental organisation comprised of the Heads and senior staff members of Nuclear Regulatory Authorities of European countries) were said to have declared the reactors safe enough to operate for a longer time, even though the relative superficial inspections only gave conclusions about operability on that moment. Every visit or sentence from pro-nuclear MEPs like former Scottish Social Democrat MEP Tony Wynn in favour of Kozloduy found wide attention in the Bulgarian media. Voices from, amongst others, Green MEPs during their visits to Bulgaria were hardly covered, if at all. They argued that Kozloduy closure postponement had no chance because it would need a change in the Accession Treaty, an act that needs unanimous support from all present 25 EU Member States. Several countries would veto any prolongation of the lifetime of these dangerous reactors. The distorted media attention lead to a ground-swell in public opinion believing that the European Parliament could and would keep Kozloduy open.
After Wynn left the Parliament after the last elections, his torch was taken over by EPP-ED fraction (Christian Democrats, by far the largest political group in the EP) members Finnish MEP Eija-Riitta Korhola and Slovenian nuclear lobbyist Romana Jordan Cizelj, and the Socialist Edit Herczog from Hungary.

Panic in the Balkans
The last months saw a spreading panic in the entire Balkan region, allegedly because closure of Kozloduy 3 and 4 would lead to energy shortages. In order to prevent unrest in Bulgaria itself, Energy and Economy Minister Rumen Ovcharov reported that there would be no problem for Bulgaria, but that Bulgaria's electricity export clients Serbia, Macedonia, Montenegro, Albania and Greece might suffer. Macedonia's grid operator MEPSO picked up the argument, diverting attention from its own grid management problems.
In Bulgaria itself a heated debate ensued about whether the closure of Kozloduy 3 and 4 would lead to price increases. On 6 December, the head of the state energy regulator told that prices for households will remain unchanged until July.

Turkey seeking Bulgarian electricity imports
Turkey approached Bulgaria to buy electricity from 2007. It offer as much as 5,7 cent/kWh. It is as to date unclear whether Bulgaria is going to export to Turkey next year or not. If so, this might be a shift of export capacity from the Balkan countries to the East because of price reasons.

Fishing for money
Some observers state that the games around Kozloduy 3 and 4 are played in order to get support for the Belene NPP project, possibly in the form of a Euratom loan. Others point at the requests now made by the Bulgarian government for higher compensation for the "loss" of Kozloduy 3 and 4. Where others would argue that Bulgaria has received already a very lucrative bonus with the EU permission to run the outdated Kozloduy reactors for the last eight years while exposing its population and the rest of Europe to risk, Bulgarian authorities with the help of IAEA calculations argue that Kozloduy could have given Bulgaria still hundreds of millions Euro of income if allowed to continue running even further. They try to claim this from the EU.

Concluding it has to be noted that Bulgaria and its electricity clients had eight years to prepare for Kozloduy 3 and 4's closure. The fact that Bulgaria could export electricity over the last years was mainly because replacement capacity for Kozloduy 1 to 4 was timely developed. The games in the European Parliament and the panic on the last moment seems to be created with other aims in mind. One thing we probably can be sure of: each glitch in the grid in the coming months or even years will probably be blamed on Kozloduy's closure and not on failing grid management.

Source and contact: Jan Haverkamp, consultant for WISE Czech Republic. Nad Borislavkou 58, CZ - 160 00 Praha 6, Czech Republic.
tel./fax (home): +420.2.3536 1734 / mobile: +420.603 569 243
E-mail: jan.haverkamp@wisebrno.cz