THE FUTURE OF NUCLEAR ENERGY HAS A GLOWING FUTURE

UNCLAS SECTION 01 OF 02 LJUBLJANA 000563 SENSITIVE SIPDIS EUR/NB AND T - MARC HUMPHREY COMMERCE - SARAH LOPP AND ITA LEAH MARKOWITZ ENERGY - MICHAEL APPICELLI E.O. 12958: N/A TAGS: BEXP BTIO ENRG ETRD TRGY SI SUBJECT: THE FUTURE OF NUCLEAR ENERGY HAS A GLOWING FUTURE IN SLOVENIA REF: SECSTATE 127468 Summary -------------- ¶1. (SBU) The Slovene nuclear energy sector holds considerable promise for the U.S. company Westinghouse. Slovenia currently shares the electricity from its only nuclear plant, which was established during Yugoslav days, with Croatia. Westinghouse built the plant, which is 50% owned by the Government of Slovenia (GoS) and 50% owned by the Government of Croatia. The plant is located on the Slovenia side of the border, in Krsko. GoS is planning to add a second unit at the same location, which will probably be 100% GoS owned and operated. GoS will almost certainly invite bids from Westinghouse for expected future plant expansions. The following presents the information requested in reftel regarding civilian nuclear energy in Slovenia. Overview -------------- ¶2. (U) Slovenia's demand for electricity has been rising steadily, and the country now imports roughly 30% of its electricity from abroad. According to several sources, one additional unit at the existing nuclear power plant in Krsko will generate sufficient electricity to meet the deficit with possible excess electricity for export. ¶3. (SBU) In October 2006, the GoS adopted a "Resolution on National Development Programs for the Period 2007-2023" in which they earmarked 2B Euro for construction of unit 2 in Krsko. The project was slated to start construction in 2015 and conclude in 2017. The new GoS is currently promoting big infrastructure projects in the energy sector to help the Slovene economy. Government, business and academics have all told emboffs that nuclear is the only viable option to solve Slovenia's energy needs. However, as of December 15, rumors have floated of introducing a referendum on the question of building a second unit in Krsko. Government officials were not able to substantiate the reports, but it is relatively easy under the Slovenian constitution to force a referendum on any issue. ¶4. (U) The nuclear regulatory authority, the Slovenian Nuclear Safety Administration (SNSA),employs 45 people and has a 2.5M Euro budget. There is no plan to expand the SNSA, as the number of people it employs is codified in law. ¶5. (U) Slovenia is party to the Paris Convention on nuclear liability. ¶6. (U) The manufacturing base in Slovenia is not involved in nuclear-related products of services. Neither components nor contracting services could be sourced locally. ¶7. (U) Slovenia has a small population and an insufficient nuclear-trained workforce. For this reason, Slovenia outsources its civil nuclear power services. Opportunities for U.S. Industry -------------- ¶8. (U) Slovenia has no current nuclear-related tenders. If/when the GoS moves to build an additional unit in Krsko, it will publish a tender conforming to EU regulations. ¶9. (U) As elsewhere, Slovenia is significantly concerned about their nuclear waste disposal. Officials at the Slovenian Nuclear Safety Administration said that any bid to build in Krsko that included a plan to remove the waste from Slovenia would probably win the construction project. A deal fell through with a Russian company to remove and dispose of nuclear waste. While there is no current tender for waste removal, the opportunity may exist for an international company that offers such services. ¶10. (U) Slovenia currently purchases nuclear services from abroad - for example, Westinghouse conducts periodic audits of spent fuel. Slovenia intends to continue to buy services to maintain its nuclear energy program. Services and training for the Slovenian nuclear energy sector are overwhelmingly supplied from the U.S. Foreign Competitors -------------- ¶11. (SBU) Assuming Slovenia builds a second reactor at the Krsko site, Westinghouse is widely considered to be the top LJUBLJANA 00000563 002 OF 002 contender for the construction bid. However, the French company Areva will probably also be invited to bid. ¶12. (U) While projects above a certain value have to be announced within the EU, the SNSA stated definitively that Slovenia would not take political considerations into account, or favor an EU company over a non-EU company. FREDEN