Russia takes Bulgaria to court over delayed nuclear plant

Belene.jpg

Russia is trying new tactics by taking Bulgaria to court in a bid to speed up construction of the Belene nuclear power plant, the first in the EU that is fully reliant on Russian technology. Dnevnik, EURACTIV's partner in Bulgaria, reports.

Russia's Atomstroyexport, a branch of the state-owned corporation Rosatom, has filed a claim for 58 million euros against Bulgaria's National Electric Company (NEK) over delayed payments for work on two nuclear reactors, RIA Novosti reported yesterday (21 July).

Atomstroyexport accuses Bulgaria of failing to respect the terms of its contract for work completed before construction of a 1,000 megawatt reactor was halted in April.

The company was quoted as saying that it had brought the case to the Paris-based ICC International Court of Arbitration because the payment delays could cause problems with tax authorities and creditors at home.

Asked by Dnevnik to comment, NEK representatives and Bulgaria's energy ministry said they first needed to be officially informed about the claim.

A governemt official was quoted as saying that if Russia had indeed filed a court claim, Bulgaria would do the same for a larger amount.

Japan's nuclear disaster increased pressure on Bulgaria from environmentalists and lobby groups to abandon the project, which they say will be built near an earthquake-prone area and will be too expensive, Reuters recalls.

At the beginning of July, Sofia announced that it was halting work on the Belene plant until September, heralding an additional three-month delay, to review safety issues and clarify the conditions of Russian funding for the project.

Bulgaria contracted Atomstroyexport back in 2006, but the project has stalled over price disputes with Moscow and funding problems. Russia has said construction will cost 6.3 billion euros, while Sofia says it should not exceed five billion.

In 2010, Moscow proposed to extend a loan to keep the project rolling. But Sofia rejected the offer, saying it would focus on finding a strategic investor.

The Bulgarian government's allies in Brussels and Washington have warned that the project will deepen Bulgaria's energy dependence on Russia, which already controls its only oil refinery and provides almost 100 percent of its natural gas.

Bulgaria has been heavily reliant on nuclear energy since the 1980s, when the Soviet-built Kozloduy nuclear power plant became operational. But, under pressure from the EU during accession negotiations, the country agreed to close down four of the plant's six units – a commitment for which Bulgaria is still seeking EU compensation.

Before units four and five were shut down, Kozloduy produced 44% of the country's electricity, 20% of which was exported. This gave Bulgaria a strategic position in the region, which it has now lost. 

In this context, the Belene project became a priority under the previous government of Socialist Prime Minister Sergey Stanishev. After years of setbacks, Stanishev turned the first sod of the 2,000 megawatt Belene plant in September 2008.

However, new Bulgarian Prime Minister Boyko Borissov said he would ask for the European Commission's opinion on three major energy projects with Russian participation negotiated by previous governments: the South Stream gas pipeline project, the Burgas-Alexandroupolis oil pipeline and the new Belene nuclear power plant

The Belene nuclear plant, which Bulgaria's second, could become operational in 2013-2014.

Subscribe to our newsletters

Subscribe