Identifier
Created
Classification
Origin
08BRATISLAVA597
2008-12-23 16:06:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Bratislava
Cable title:
CIVIL NUCLEAR ENERGY SECTOR OVERVIEW
how-toVZCZCXRO3746 RR RUEHAG RUEHDF RUEHIK RUEHLZ RUEHROV RUEHSR DE RUEHSL #0597/01 3581606 ZNR UUUUU ZZH R 231606Z DEC 08 FM AMEMBASSY BRATISLAVA TO RUEHC/SECSTATE WASHDC 2201 INFO RUCNMEM/EU MEMBER STATES COLLECTIVE RHEBAAA/DEPT OF ENERGY WASHDC RUCPDOC/DEPT OF COMMERCE WASHDC
UNCLAS SECTION 01 OF 03 BRATISLAVA 000597
SENSITIVE,SIPDIS
DEPARTMENT FOR T/MARC HUMPHREY
USDOC FOR ITA:LMARKOWITZ AND SLOPP
DOE:MAPICELLI
NRC:BWITTICK AND JRAMSEY
E.O. 12958: N/A
TAGS: ENRG TRGY BEXP BTIO EPET PGOV LO
SUBJECT: CIVIL NUCLEAR ENERGY SECTOR OVERVIEW
REFTEL: A) SECSTATE 127423
B) BRATISLAVA 582
UNCLAS SECTION 01 OF 03 BRATISLAVA 000597
SENSITIVE,SIPDIS
DEPARTMENT FOR T/MARC HUMPHREY
USDOC FOR ITA:LMARKOWITZ AND SLOPP
DOE:MAPICELLI
NRC:BWITTICK AND JRAMSEY
E.O. 12958: N/A
TAGS: ENRG TRGY BEXP BTIO EPET PGOV LO
SUBJECT: CIVIL NUCLEAR ENERGY SECTOR OVERVIEW
REFTEL: A) SECSTATE 127423
B) BRATISLAVA 582
1. (U) Responses to reftel questions follow.
Overview of Civil Nuclear Power Program
--------------
2. (U) Slovakia currently has five 440 megawatt (MW) nuclear
reactors in operation. One of them will be shut down in December
2008. Two 440 MW reactors are currently under construction with
plans for one, and possibly two, new projects.
3. (U) The state-owned company JAVYS a.s. owns two reactors at
Nuclear Power Plant V1 Jaslovske Bohunice located in western
Slovakia, near the town of Trnava. Both reactors are of the Russian
VVER 440 design, type V230, and each one has an installed capacity
of 440 MW. The GoS agreed to close these two Soviet-era nuclear
reactors during EU accession negotiations. The first reactor was
shut down in December 2006, and JAVYS a.s. is currently working on
its decommissioning. The second reactor is still in operation but
is scheduled to be shut down by the end of 2008.
4. (U) After the second reactor is closed, total installed
production capacity countrywide will drop from 8,157 MW to 7,277 MW.
At the same time, the demand for electricity in Slovakia is
projected to increase over the next 10-15 years. The GoS considers
it a strategic priority not to rely on imported electricity; as a
result, it plans to expand production with both thermal and nuclear
plants.
5. (U) Slovenske Elektrarne a.s.owns two additional nuclear reactors
at the Nuclear Power Plant V2 Jaslovske Bohunice. Slovenske
Elektrarne a.s. is managed by the Italian energy firm ENEL (49
percent shareholder) with the Slovak government as majority
shareholder. Electricity is generated by two 440 MW reactors of the
same VVER 440 design, type V213. Both V2 reactors will be closed in
2025 or 2026.
6. (U) The next four nuclear reactors, also owned and operated by
Slovenske Elektrarne a.s., are located at Mochovce in southern
Slovakia, between the towns of Nitra and Levice. All four of these
reactors use pressurized water and are of the same WER 440 design,
type V213, with an installed capacity 440 MW for each reactor. The
Mochovce facility is divided into two plants - EMO 1 and EMO 2. The
first reactor at EMO 1 has been in operation since 1998, and the
second reactor has been supplying electricity since late 1999. Both
reactors are scheduled to be shut down in 2045. EMO2 is currently
under construction. The third reactor should be completed by 2012
and the fourth reactor is expected to be completed by 2013.
7. (U) Slovakia plans to build a fifth reactor unit in Jaslovske
Bohunice and possibly an additional new reactor in Kecerovce in
eastern Slovakia. Plans for Bohunice 5 (V3) were announced in April
2008 and call for 1000-1600 MW capacity. The manufacturing base in
Slovakia is not involved in nuclear-related products or services so
the majority of components or contracting services for new plants
would need to be imported. The Economy Ministry has stated that
Slovakia would benefit from the participation of a foreign strategic
investor in the construction of the new nuclear unit and recently
selected the Czech energy group CEZ as its strategic partner. CEZ
is to become a 49-percent managing shareholder in a 100-percent
special purpose vehicle (SPV) that is to be established by the GoS.
The Ministry has not yet specified the type or capacity of the
reactor for Jaslovske Bohunice. The final decision on these issues
is scheduled to be made by October 2010. The GoS and CEZ are
expected to seek financing from a variety of sources. The GoS has
not specified what incentives will be available for this project,
but it has a number of established subsidy programs for new
investment, including direct subsidies, employment subsidies,
education credits, income tax relief, and land grants. Direct
financing participation and/or guarantees from the GoS are possible.
8. (U) The GoS plans to create a new facility to be used as a final
storage disposal site for used nuclear fuel and other nuclear waste.
The total planned investment is $4.73 billion. The government is
considering five potential locations for this facility. All costs
for the building of the storage facility, the decommissioning of
reactors, and storage of used fuel from reactors will be paid by the
National Nuclear Fund.
9. (U) Slovakia has the workforce necessary to run the five nuclear
power plants currently operating. The expansion of civil nuclear
power will not require a significant foreign workforce. However, we
are unaware of the demographic distribution of the current
workforce; pending retirements may affect its size over the long
term. Officials in the regulatory authority have raised the
declining graduation rate of young nuclear engineers as a concern
for the future of the industry. Programs are in place for the
training of domestic personnel.
10. (SBU) The Nuclear Regulatory Authority of the Slovak Republic
(UJDSR) is an independent regulatory body responsible for licensing,
safety, waste management, radiation protection and security. UJDSR
BRATISLAVA 00000597 002 OF 003
has 81 full time employees with plans to expand to 89 employees.
COMMENT: Recently, the GOS has undertaken efforts to constrain the
ability of energy suppliers to raise prices and allegedly has
attempted to pressure regulatory bodies to act in line with GOS
preferences in violation of EU requirements (reftel b),including by
firing "uncooperative" leadership. Given the strategic and economic
importance of the nuclear sector in Slovakia, this emerging pattern
could presage similar pressures on the UJDSR. END COMMENT.
11. (U) UJDSR has the following enforcement powers:
--Issues decisions based on the Atomic Act and Building Code.
--Evaluates documentation submitted by supervised institutions.
--Evaluates events at nuclear facilities, nuclear safety, and
reviews decisions resulting from the Atomic Act.
--Executes state supervision, inspection activities, and
administration of sanctions in case of violations.
--Coordinates emergency preparedness of the Slovak Republic for a
radiation event.
--Publicizes information on nuclear safety issues.
--Manages the state record system for nuclear materials.
--Fulfills the role of lead agency in implementing relevant EU
commitments and international treaties and agreements.
--Drafts and comments on legislation.
12. (U) Nuclear liability is governed by the Vienna Convention (No.
70/1996),signed by Slovakia in January 1995, and the Nuclear Law
(No. 541/2004). The minimum level of liability coverage required
for operators is EURO 75 million for nuclear power units for
production of electricity and EURO 50 million for other nuclear
equipment and transportation of nuclear fuel.
Opportunities for U.S. Industry
--------------
13. (U) We anticipate tenders for two new plants in Jaslovske
Bohunice; specifications and method of tender are expected to be
determined in late 2010. The GoS recently selected a strategic
partner (CEZ) to structure and set specifications for the new build
at Jaslovske Bohunice. As a minority shareholder in a stand-alone
corporation, the partner will have management responsibilities for
both the build and the operation of the new plant. The method and
technical specifications for choosing technology providers has not
been determined. Whether these will be open tender has also not
been determined. The final decision on these issues should be made
in October 2010.
14. (U) U.S. companies are potential suppliers of feasibility
studies or other consulting services, plant construction management,
reactor sales, fuel cycle service provision, waste management, and
logistics for planned nuclear reactors. Potential U.S. suppliers
include American Brazing Co., Babcock & Wilcox Company, Basler
Electric Co., Bechtel Nuclear Power, Brooks, GE Energy, Henry Pratt
Co., Hudson Energy, Megawatt Machine Services, Nace International,
Parker Hannifin Corporation, Washington Group International,
Westinghouse, and others.
15. (U) The primary companies involved in Slovakia's civil nuclear
sector follow.
Current electricity utilities and plant operators:
--Slovenske elektrarne a.s. (SE a.s.)
--Jadrova a vyradovacia spolocnost (JAVYS)
Major domestic construction or consulting firms:
--JAVYS
--Vyzkumny ustav jadrovej energetiky (VUJE)
Other institutions:
--Nuclear Power Research Institute
--Office of Standards, Metrology and Testing
--Electrotechnical Research and Design Institute
--Union for the Co-ordination of Transmission of Electricity
--Slovak Nuclear Regulatory Authority
--National Nuclear Fund
Foreign Competitors
--------------
16. (U) Slovakia signed MOUs with France and Russia on nuclear
energy cooperation in 2008. Anticipated foreign technology vendors
and fuel cycle service providers follow.
--German firms RWE, E.ON and EnBW
--French companies Electricite de France (EdF) and Electrabel (a
member of the GdF Suez concern)
--Italian company Enel
--Swedish company Vattenfall
--Spanish company Iberdrola
--Czech energy group CEZ
--Finish firm Fortum Ovi
BRATISLAVA 00000597 003 OF 003
17. (SBU) Slovakia's dependence on Russian gas and oil may steer
business toward Russian nuclear suppliers in hopes of influencing
gas and oil price agreements. Existing business ties with German,
Italian, and French energy companies may advantage suppliers from
those countries. On the other hand, the current government has had
rocky relationships with its foreign partners, in privatized energy
companies. Historically close cooperation between the Slovak and
Czech nuclear sectors appears to have influenced the selection of
CEZ as the strategic partner for the new build in Jaslovske
Bohunice.
18. (SBU) Nonetheless, there should be opportunities for U.S. firms,
offering more technologically advanced and safer technologies than
some foreign competitors, to participate in Slovakia's efforts to
expand its nuclear capacity. Embassy Bratislava will monitor and
report on the evolving business environment, to include transparency
in government contracting and award of EU funds, as well as on
developments in the nuclear energy sector.
OBSITNIK
SENSITIVE,SIPDIS
DEPARTMENT FOR T/MARC HUMPHREY
USDOC FOR ITA:LMARKOWITZ AND SLOPP
DOE:MAPICELLI
NRC:BWITTICK AND JRAMSEY
E.O. 12958: N/A
TAGS: ENRG TRGY BEXP BTIO EPET PGOV LO
SUBJECT: CIVIL NUCLEAR ENERGY SECTOR OVERVIEW
REFTEL: A) SECSTATE 127423
B) BRATISLAVA 582
1. (U) Responses to reftel questions follow.
Overview of Civil Nuclear Power Program
--------------
2. (U) Slovakia currently has five 440 megawatt (MW) nuclear
reactors in operation. One of them will be shut down in December
2008. Two 440 MW reactors are currently under construction with
plans for one, and possibly two, new projects.
3. (U) The state-owned company JAVYS a.s. owns two reactors at
Nuclear Power Plant V1 Jaslovske Bohunice located in western
Slovakia, near the town of Trnava. Both reactors are of the Russian
VVER 440 design, type V230, and each one has an installed capacity
of 440 MW. The GoS agreed to close these two Soviet-era nuclear
reactors during EU accession negotiations. The first reactor was
shut down in December 2006, and JAVYS a.s. is currently working on
its decommissioning. The second reactor is still in operation but
is scheduled to be shut down by the end of 2008.
4. (U) After the second reactor is closed, total installed
production capacity countrywide will drop from 8,157 MW to 7,277 MW.
At the same time, the demand for electricity in Slovakia is
projected to increase over the next 10-15 years. The GoS considers
it a strategic priority not to rely on imported electricity; as a
result, it plans to expand production with both thermal and nuclear
plants.
5. (U) Slovenske Elektrarne a.s.owns two additional nuclear reactors
at the Nuclear Power Plant V2 Jaslovske Bohunice. Slovenske
Elektrarne a.s. is managed by the Italian energy firm ENEL (49
percent shareholder) with the Slovak government as majority
shareholder. Electricity is generated by two 440 MW reactors of the
same VVER 440 design, type V213. Both V2 reactors will be closed in
2025 or 2026.
6. (U) The next four nuclear reactors, also owned and operated by
Slovenske Elektrarne a.s., are located at Mochovce in southern
Slovakia, between the towns of Nitra and Levice. All four of these
reactors use pressurized water and are of the same WER 440 design,
type V213, with an installed capacity 440 MW for each reactor. The
Mochovce facility is divided into two plants - EMO 1 and EMO 2. The
first reactor at EMO 1 has been in operation since 1998, and the
second reactor has been supplying electricity since late 1999. Both
reactors are scheduled to be shut down in 2045. EMO2 is currently
under construction. The third reactor should be completed by 2012
and the fourth reactor is expected to be completed by 2013.
7. (U) Slovakia plans to build a fifth reactor unit in Jaslovske
Bohunice and possibly an additional new reactor in Kecerovce in
eastern Slovakia. Plans for Bohunice 5 (V3) were announced in April
2008 and call for 1000-1600 MW capacity. The manufacturing base in
Slovakia is not involved in nuclear-related products or services so
the majority of components or contracting services for new plants
would need to be imported. The Economy Ministry has stated that
Slovakia would benefit from the participation of a foreign strategic
investor in the construction of the new nuclear unit and recently
selected the Czech energy group CEZ as its strategic partner. CEZ
is to become a 49-percent managing shareholder in a 100-percent
special purpose vehicle (SPV) that is to be established by the GoS.
The Ministry has not yet specified the type or capacity of the
reactor for Jaslovske Bohunice. The final decision on these issues
is scheduled to be made by October 2010. The GoS and CEZ are
expected to seek financing from a variety of sources. The GoS has
not specified what incentives will be available for this project,
but it has a number of established subsidy programs for new
investment, including direct subsidies, employment subsidies,
education credits, income tax relief, and land grants. Direct
financing participation and/or guarantees from the GoS are possible.
8. (U) The GoS plans to create a new facility to be used as a final
storage disposal site for used nuclear fuel and other nuclear waste.
The total planned investment is $4.73 billion. The government is
considering five potential locations for this facility. All costs
for the building of the storage facility, the decommissioning of
reactors, and storage of used fuel from reactors will be paid by the
National Nuclear Fund.
9. (U) Slovakia has the workforce necessary to run the five nuclear
power plants currently operating. The expansion of civil nuclear
power will not require a significant foreign workforce. However, we
are unaware of the demographic distribution of the current
workforce; pending retirements may affect its size over the long
term. Officials in the regulatory authority have raised the
declining graduation rate of young nuclear engineers as a concern
for the future of the industry. Programs are in place for the
training of domestic personnel.
10. (SBU) The Nuclear Regulatory Authority of the Slovak Republic
(UJDSR) is an independent regulatory body responsible for licensing,
safety, waste management, radiation protection and security. UJDSR
BRATISLAVA 00000597 002 OF 003
has 81 full time employees with plans to expand to 89 employees.
COMMENT: Recently, the GOS has undertaken efforts to constrain the
ability of energy suppliers to raise prices and allegedly has
attempted to pressure regulatory bodies to act in line with GOS
preferences in violation of EU requirements (reftel b),including by
firing "uncooperative" leadership. Given the strategic and economic
importance of the nuclear sector in Slovakia, this emerging pattern
could presage similar pressures on the UJDSR. END COMMENT.
11. (U) UJDSR has the following enforcement powers:
--Issues decisions based on the Atomic Act and Building Code.
--Evaluates documentation submitted by supervised institutions.
--Evaluates events at nuclear facilities, nuclear safety, and
reviews decisions resulting from the Atomic Act.
--Executes state supervision, inspection activities, and
administration of sanctions in case of violations.
--Coordinates emergency preparedness of the Slovak Republic for a
radiation event.
--Publicizes information on nuclear safety issues.
--Manages the state record system for nuclear materials.
--Fulfills the role of lead agency in implementing relevant EU
commitments and international treaties and agreements.
--Drafts and comments on legislation.
12. (U) Nuclear liability is governed by the Vienna Convention (No.
70/1996),signed by Slovakia in January 1995, and the Nuclear Law
(No. 541/2004). The minimum level of liability coverage required
for operators is EURO 75 million for nuclear power units for
production of electricity and EURO 50 million for other nuclear
equipment and transportation of nuclear fuel.
Opportunities for U.S. Industry
--------------
13. (U) We anticipate tenders for two new plants in Jaslovske
Bohunice; specifications and method of tender are expected to be
determined in late 2010. The GoS recently selected a strategic
partner (CEZ) to structure and set specifications for the new build
at Jaslovske Bohunice. As a minority shareholder in a stand-alone
corporation, the partner will have management responsibilities for
both the build and the operation of the new plant. The method and
technical specifications for choosing technology providers has not
been determined. Whether these will be open tender has also not
been determined. The final decision on these issues should be made
in October 2010.
14. (U) U.S. companies are potential suppliers of feasibility
studies or other consulting services, plant construction management,
reactor sales, fuel cycle service provision, waste management, and
logistics for planned nuclear reactors. Potential U.S. suppliers
include American Brazing Co., Babcock & Wilcox Company, Basler
Electric Co., Bechtel Nuclear Power, Brooks, GE Energy, Henry Pratt
Co., Hudson Energy, Megawatt Machine Services, Nace International,
Parker Hannifin Corporation, Washington Group International,
Westinghouse, and others.
15. (U) The primary companies involved in Slovakia's civil nuclear
sector follow.
Current electricity utilities and plant operators:
--Slovenske elektrarne a.s. (SE a.s.)
--Jadrova a vyradovacia spolocnost (JAVYS)
Major domestic construction or consulting firms:
--JAVYS
--Vyzkumny ustav jadrovej energetiky (VUJE)
Other institutions:
--Nuclear Power Research Institute
--Office of Standards, Metrology and Testing
--Electrotechnical Research and Design Institute
--Union for the Co-ordination of Transmission of Electricity
--Slovak Nuclear Regulatory Authority
--National Nuclear Fund
Foreign Competitors
--------------
16. (U) Slovakia signed MOUs with France and Russia on nuclear
energy cooperation in 2008. Anticipated foreign technology vendors
and fuel cycle service providers follow.
--German firms RWE, E.ON and EnBW
--French companies Electricite de France (EdF) and Electrabel (a
member of the GdF Suez concern)
--Italian company Enel
--Swedish company Vattenfall
--Spanish company Iberdrola
--Czech energy group CEZ
--Finish firm Fortum Ovi
BRATISLAVA 00000597 003 OF 003
17. (SBU) Slovakia's dependence on Russian gas and oil may steer
business toward Russian nuclear suppliers in hopes of influencing
gas and oil price agreements. Existing business ties with German,
Italian, and French energy companies may advantage suppliers from
those countries. On the other hand, the current government has had
rocky relationships with its foreign partners, in privatized energy
companies. Historically close cooperation between the Slovak and
Czech nuclear sectors appears to have influenced the selection of
CEZ as the strategic partner for the new build in Jaslovske
Bohunice.
18. (SBU) Nonetheless, there should be opportunities for U.S. firms,
offering more technologically advanced and safer technologies than
some foreign competitors, to participate in Slovakia's efforts to
expand its nuclear capacity. Embassy Bratislava will monitor and
report on the evolving business environment, to include transparency
in government contracting and award of EU funds, as well as on
developments in the nuclear energy sector.
OBSITNIK