News

08.10.2012

Baltic N-plant is the must

 

The history of Baltic NPP started in 2006. At that time ROSATOM together with other energy market stakeholders was involved in the development of a master plan of Russia’s entire power generation development. A balance settlement showed Kalinin Region development was slowed down exactly due to an energy shortage. The project investments will be RUB241 Billion. Sergey Boyarkin, the Program Director of the Capital Projects Directorate of ROSATOM, revealed Galina Kozorezova, an Izvestia newspaper observer, what economic effect the region will see after the nuclear power units have been commissioned.

- What else, in addition to the energy shortage in the region, did influence the choice of site for another Russia’s nuclear power plant specifically in Kaliningrad Region?

- At that time, in 2006, Kaliningrad enclave received a sizable share of electricity from Ignalina NPP (nuclear power plant). But Lithuania, under its EU ascension commitments, should have closed that plant. So the second reactor of Ignalina NPP was closed in December 2009; the first one had been shut down earlier, in 2007. Therefore, two units of combined cycle plant HPP-2 were urgently commissioned in Kaliningrad. Now, these two units of 450 MW each are the only energy source in the region. When a region with a population of one million people relies on the only energy source, it means that any guaranteed energy supply cannot be spoken about. There have been cases when a unit stopped due to that or other causes and Kaliningrad stayed without own energy sources.

Energy from outside comes by transit through two countries, i.e. Belarus and Lithuania. The distance is big and this means it is expensive and unreliable. Grids may face disconnection, say, a tree fells or lightning strokes. Today, Kalinigrad’s energy mix is 100% natural gas. And natural gas is most expensive type of generation. A wind farm was built in Kaliningrad with a Dutch assistance. But it has been idling, because wind energy is not subject to energy dispatch system today. As a consumer, you are not interested in whether there is wind or not when you want to switch on your TV set. The Kaliningrad wind farm makes 0.1% in the regional energy mix. And the operating experience has shown energy produced by the farm is more expensive than that of gas-fired plant. Besides, winds are good on the coastal side but in Kaliningrad there are two wild life resorts in Curonian Spit. This is the place where birds’ migration paths cross. The nature protection law prohibits building windmills in such places.

If we keep the natural gas-based generation only, we can forget about the economic development of the region. The only way of making the territory investment attractive is to build up a cheap generation there. There is only one as such in the world; it’s nuclear power. Another type has not been invented yet and won’t be in the nearest future. With this, I would like to stress, it emits zero greenhouse gases. This means that if the Kyoto process continues, the nuclear power competitiveness will increase ever more.

- How many units will be at Baltic NPP?

- Two. The first unit will work mainly to meet the needs of the region. Since Kaliningrad HPP-2 capacities and consumption rate are at the same level, the redundant power has to be purchased. In Lithuania. When we start up Baltic-1, we will buy redundant power from our own HPP.

Today, the American power system works very efficiently where nuclear power plants operate at a capacity factor of 92%. In other words, 92% of time NPPs operate at full power. But the natural gas-based generation features a capacity factor of 35% only. Why? Because nuclear is cheaper, it’s continuously on. It ensures the baseline power, but gas-based generation is switched on only to cope with the peaking load. And at hydro a capacity factor is 25% altogether. Cheap atom and coal provide maximum generation. We want to build up a similar power grid configuration in Kaliningrad Region as well. And there will be a possibility to export energy already as soon as the first reactor is up and running.

- How will the Kaliningrad grid be connected with other bordering territories?

- Today, in this region grids are running to the Baltics only. There is no a connection of Lithuania with Europe as well. This reduces the system reliability very much. Should electricity transmission lines on the European side switch off, there will be no energy supplies; there are no grids. Lithuania has plans of connecting with the Polish power grid. And they want to build one high-voltage line. We too. So if they are built, and we are sure they will be, because it’s beneficial for all, there will be a ring-type system: Poland-Kaliningrad-Lithuania. It will ensure a high reliability of power supply in this region. The availability of grids and possibility of transmitting energy to all directions will provide conditions for the market development. This will lead to a reduction in energy costs. Today energy in the Baltics costs higher than in Europe.

- By how much?

- Generally, by 20–30% than average in Europe. Therefore, we speak not only about building the plant but about the grids as well. Kaliningrad will be a transit region, which will earn by transiting others’ energy between the Baltics and Europe.

- The amount of investments in the plant construction has changed as time goes. What is the reason?


- As soon as money comes to this world, inflation has been stepping it. Look, how much electricity cost ten years ago and how much it is today. Currently, our nuclear reactors are most competitive in terms of price in the world. South Koreans declare much lower price, but we, in fact, build at the level of $2,700 per kilowatt of installed capacity. And what about our competitors in Europe and the USA … Their price is about twice higher. South Korea declares $2,300, but they have not built a single unit at this cost yet. But we build at the declared price. We are leaders in terms of a number of commissioned units in Russia and worldwide. Over the 2000s we put on line more units than the rest of countries all together. Two reactors at Rostov NPP and two reactors at Kalinin NPP. We are completing construction of a fast neutron reactor at Beloyarsk NPP. We have commissioned reactors in China, Iran, and today we are at the commissioning stage of two reactors in India.

Unlike our competitors, we build in series. This is what allows us to ensure the lowest nuclear construction cost, given the well-mastered technology. By the way, operational costs of a nuclear power unit are by order of magnitude less than that of a gas-fired unit. By 10 times! The cost of uranium in the prime cost of a kilowatt-hour of a nuclear power unit is 5%. But the fuel cost in the natural gas-based generation’s operational costs it is 60%. Even if uranium becomes twice expensive, the cost of energy will not change in fact… Nuclear power allows guaranteeing long-term development plans to this or other territory. By the way, the largest number of reactors is being built in China today – by us, Japanese, Europeans, Americans – 28 reactors in total. And 23 reactors more are at the licensing stage, i.e. at the construction preparation stage. The USA and India have similar large-scale programs. The countries who count on the economic growth invest large money in power supply at guaranteed price, which doesn’t depend on external situation fluctuations. The U.K. also has large-scale building plans, and Finland. In fact, of the countries who used to have nuclear construction plans only Switzerland has scrapped them. Germany didn’t have the construction plans.

- And has abandoned those [plants] it has?

- It’s a crafty thing. They operate and will be shut down only in 2023. In 1989 the country under Gerhard Schröder’s Cabinet and “green” Joshka Fischer governance already made a decision to phase out the power units. Later, Angela Merkel cancelled this decision and operation was continued. The utilities that generate cheap electricity at NPPs and enjoy excessive profits must pay a share of this profit to the fund supporting the development of wind and solar energy. It makes several billion euros a year. This is what makes their alternative energies develop. How will this development continue after 2023, with what money? However, there will be many elections before this time comes.

- How has it happened that Rosenergoatom invites private investors to Baltic NPP?


- A part of energy will be sold on the very profitable European market where prices are substantially higher than in Russia. And if we want to get excessive profits there… What would the Europeans say? “You are getting excessive profits and do not let us in your business?” It’s a wrong way. Both sides should win. Therefore, when the project was just being discussed, including in the Government, we were talking about the participation of investors. It is Baltic NPP that a special decision was made on by the Government, which permits us to give up to 49% of the plant’s capital to private investors, including foreign ones. 51% remains with Rosenergoatom.

- When will names of investors be known?

- Under the business plan, the investment agreements are planned to sign in 2012. Before bringing in their money, western companies must be sure that the project is safe. It takes a year and half to study the document package. I cannot give you the names of investors so far; there is a confidentiality agreement. Large money does require silence.

- At what stage the construction is?

- The ground breaking was on February 25, 2010. By now, the pre-construction has been accomplished; late last year we were granted a construction license, i.e. to pour concrete to the nuclear island foundation plate. The active construction takes four years.

- Some ecologists are raising concerns regarding the Baltic NPP site, saying the studies were insufficient; geology was not taken into account …


- We started the site surveys as far back as 2006. And we obtained a siting license in accordance with both Russian regulations and the IAEA recommendations. We successfully passed all expert reviews, including public hearings. I personally traveled for about 10 times with a team of architects and surveyors there, and held round-table discussions with various audiences ranging from university students and members of parliament through business leaders. Sometimes, environmental organizations were invited. We held hearings on Baltic NPP not only in Russia. We have voluntarily undertaken commitments under the Espoo Convention, which deals with an environmental impact in a transboundary context; and conducted all procedures under this convention in 9 countries of the region: Latvia, Estonia, Finland, Poland, Germany, Belarus, Denmark, Sweden, and Norway.

- What are most captious countries?

- The most interested are Finland, Poland and Germany. The Finns know our technology very well; they ask highly tailored questions. They operate Loviisa NPP built by the Soviet Union. By the way, this plant was designed by St. Petersburg-based Atomenergoproekt, which have designed Baltic NPP. Poland asks a lot of questions. It intends to build three reactors; by these procedures they are learning how to respond to future questions we will ask then later.

- What infrastructure is around the site?

- The site is at about 110 km from Kaliningrad and 20 km from Sovetsk. We are building electricity transmission lines, roads. There was an old one, and we are building two new roads, from the scratch. By the way, these costs are part of overall plant costs. We have reconstructed the railroad running from Neman to Kaliningrad. Also, we are building a training and medical center. In parallel, a public information center will be built. We guide site tours already today.

- Have your technical standards been updated somehow after the Fukushima-Daiichi accident?

- They have been most stringent in the world without it. We have learned from the tragic experience of Chernobyl and developed most stringent safety standards. For example, under our standards a nuclear power plant is prohibited to build where Fukushima is located. According to our standards a NPP is prohibited to build even if there is a single prohibiting factor exists in the site region, but there were three of them in Japan. We build only there where all parameters allow us to build.

- Director General of ROSATOM Sergey Kirienko sent the Lithuanian leaders an open letter proposing to hold consultations on Baltic NPP at any time of their convenience. What did trigger such an address?

- As I have already said, under the Espoo Convention we give the neighboring states all information of the NPP environmental impact and hold consultations with specialists from the neighboring states on the issue. The only country which has not appointed such consultations is Lithuania. With this, Lithuania is claiming that we allegedly fail to provide it the Baltic NPP information, though we have handed over all necessary information to it: the NPP environmental impact assessment report, the site seismic survey report and other documents through the MFA of Russia (Ministry of Foreign Affairs). Moreover, their specialists sent us questions on this allegedly “failed to be provided” documentation, and we gave them official answers also through the MFA of Russia many times.

We cannot assign consultations in Lithuania; it is their right whether to assign such consultations or not. But this proposal of ROSATOM was sent as another attempt to bring the information exchange process into the functional plane. In response we read a Lithuania MFA’s statement where they reiterated that they had got no answers to 6 questions. What can be said about it? I was personally involved in preparing answers to those 6 questions, and Lithuania received those answers several times. Copies of relevant notes of the MFA of Russia are in this file and you can look at them. Let’s hope the common sense wins and Lithuania will start an evidence-based dialogue. We are open to the information exchange and consultations with our Lithuanian neighbors. 

Source: Izvestia