Nuclear energy project comes with ups and downs

The project deals with two major problems, however: lack of labor force due to poor salaries and difficulties in managing radioactive waste. Million of euros should be invested in several deposits for toxic waste.
The Cernavoda project raised interest of major international energy companies because of the cheap costs of producing nuclear power. If the nuclear fuel price will grow even by 50 percent, the effect on nuclear energy's price is below 5 percent per each ton.
Romania's plan comes in the larger context. To respect the Kyoto Treaty, European countries started to turn over to nuclear power. In France, 80 percent of the consumed energy comes from nuclear power and Germany is studying the opportunity to reopen some nuclear plants.
“Romania has to reach energy independence and stop being dependent on Russian gas or imports.” This is one target the Economy and Finance Minister Varujan Vosganian set for himself when he was named to his post.
“We will simultaneously build two nuclear plants. We have to rely on nuclear power and also on our capacity to produce electricity using our hydro-electric plants to assure our energy independence,” said Vosganian.
According to the Economy Ministry, the targets are already set: by the year 2015, Romania will produce internally more than 70 percent of the necessary energy. “Now, we have a hydro power capacity of almost 34 percent from the total needed. Beginning with September this year, Unit 2 from Cernavoda will start producing at maximum capacity and that will mean almost 18 percent of nuclear power. The rest of energy is produced with gas and carbon.
When Units 3 and 4 will be operational in 2014, the total nuclear power produced in Romania will cover around 36 percent from the total needed,” Valica Gorea, president of the Romanian Nuclear Agency told Business Review.

Reactor 2 from Cernavoda: Active
This year the Unit 2 reactor at Cernavoda was started. With a capacity of 700 MW, specialists say that both existing reactors at Cernavoda will be able to supply almost 18 percent of nuclear energy from the national requirement. “From 2003, when were restarted building procedures, EUR 900 million was invested, but the total investment at Unit 2 reaches EUR 1.4 billion,” Lavinia Rizea, from communication department at Nuclearelectrica. Nuclearelectrica, the Romanian company that owns the Cernavoda plant, reported in the first quarter of this year a net profit of EUR 15.6 million.

Reactors 3 and 4 set for opening in 2014
By 2014 the Economy Ministry wants to start reactors at Units 3 and 4. The total investment is evaluated at EUR 2.2 billion, without taking into account warranties and other expenses. From this sum EUR 1.4 billion will be invested in environmental protection.
The EUR 2.2 billion does not include all assets owned by Romanian state. “The buildings and the land of Cernavoda are not included in this sum. They are evaluated at 22 percent from the total investment at Cernavoda at Units 3 and 4,” says the president of the Romanian Nuclear Agency.
In 2003 and 2004 there were discussions about a public-private partnership, but nothing has been concluded since. “The public-private partnership to assure the money for units 3 and 4 investment was a good idea but no deadlines were specified. After Romania's accession to the EU, a public partnership isn't allowed by law,” explained Gorea. All investors will have to cover 30 percent of total investment. Also several banks such as BRD – Groupe Societe Generale, Merrill Lynch, and Fortis Bank, have already expressed their intention to finance the Cernavoda project. Recently the Finance Ministry purposed that a 15 percent share package to be listed on the BVB. Also, there were discussions about the elimination of historical debts of the company to the state budget, which are evaluated at EUR 180 million.
The government announced plans to implement the “Finnish model,” where investors are also clients for the energy produced. According to Nuclearelectrica officials, all investors will own an equal share package and a private investor will not be able to own a majority. Each must be able to invest EUR 50 million. The investors will be able to sell the energy or will let Nuclearelectrica handle this and only receive money from each transaction with their energy.
Who will Cernavoda produce for?
Last year, on the Bilateral Market of Romanian Power Market Operator, Nuclearelectrica sold 1,133,480 MW to Electromagnetica, Energy Holding, Energy Financing Team, Total Electric Oltenia, EGL Gas&Power Romania and Grivco.
Minister Vosganian said that the cheap nuclear energy produced at Unit 2 will be used in Romania and will not be exported. “Nuclearelectrica doesn't have export contracts, and it is hard to foresee what quantity of nuclear energy will be exported,” said Nuclearelectrica representatives. It has already been mentioned that when Units 3 and 4 will be productive, the cheaper energy will not be exported.

Project faces lack of specialized work force
Projects at Cernavoda have one more weak point: problems with specialized labor force as few students nowadays choose to specialize in nuclear energy.
“In Romania a medium salary for a nuclear energy specialist is around EUR 1,000 and the same person can obtain, for example, EUR 10,000 in Korea. In these conditions we cannot expect that young people stay in Romania,” said the president of Romanian Nuclear Agency.

significant investments needed for managing nuclear waste
Specialists say that one of the problems at a nuclear plant is how the radioactive waste is managed. In Romania radioactive wastes are deposited at the National Deposit of Nuclear Waste in Baita-Bihor. “This is a temporary deposit. There are discussions to build a surface deposit by 2014 for medium radioactive waste. By 2055 a geological deposit for used nuclear fuel should be built,” said Stela Diaconu, spokesperson for National Radioactive Waste Agency (ANDRAD). According to specialists, a unit from the nuclear power plant produces approximately 30 cubic meters every of weak radioactive waste and 90 tons of used nuclear fuel every year. ANDRAD officials say that a deposit for medium radioactive waste costs almost EUR 250 million. For a geological deposit the investment is estimated at EUR 2 billion. These investments have to be made because the international laws say that each country that produces nuclear power has to manage its nuclear waste. “The national and also the international laws forbid radioactive waste import/export. It has to be deposited in the country which produces nuclear power,” added Diaconu for Business Review.