By Kakia Papadopoulou
The closure of the two aging reactors in the Kozlodui nuclear plant as of Dec 31, an EU-requirement for Bulgaria’s entry in the bloc on Jan 1, seems that it will have less financial impact on Sofia than it will have on Athens.
Bulgaria is the biggest electricity exporter in the Balkans exporting some 7 million megawatt-hour of electricity per year.
Greece imported some 3,500 GWH in 2005 and the estimates for 2006 are of imports of 4,000 GWH, of which 70% to 80% come from Bulgaria.
“We will need to operate more units,” said Dimitris Papaconstantinou director of strategy and planning with Public Power Corp (PPC), the country’s main electricity producer. “But the cost will be considerably higher if we put in operation some expensive fuel units,” he added.
Greece bought from Bulgaria electricity for an average price of EUR40 per MWH in 2006. The respective cost for PPC is seen between EUR50 and EUR60 per MWH, given the rising oil and natural gas prices.
In other words, the closure of Kozlodui will burden PPC and then the Greek consumers with some EUR50 million per year, as analysts reckon.
“It’s unlikely to see a dramatic rise in tariffs short-term,” says Papaconstantinou. But PPC is directly affected and that was reflected in the company’s poor profitability in 2006. The closure of Kozlodui will make things even worse.
The company reported a sharp drop in its nine-month net profits, falling 53% to EUR72.2 million due to the higher fuel purchase costs amid rising revenues.
Despite Sofia’s pressure to keep the two aging reactors, 3 and 4 of Kozlodui-the reactors 5 and 6 will remain operational-the EU’s decision is irreversible.
“Definitely there is some work to be done to produce more power (in the region) but still there will not be blackouts. So it is enough power generation,” that was the European Union Energy Commissioner Andris Piebalgs’ answer to the letter sent by the Bulgarian Economy & Energy Minister Rumen Ovcharov, threatening about the potential power problems Bulgaria’s neighbors will face.
Even with the closure of the 3,and 4 reactors in Kozlodui, the 5 and 6 units will produce some 1,000 MWH each, enabling the Balkan country to export some 1,500 GWH per year.
Considering Sofia’s economic benefits of joining the EU, the closure of the two aging reactors is a matter of no big importance. At the same time, Bulgarians decided to revive the construction of Belene, the second nuclear power plant which was mothballed in 1990 because of protests and lack of funds.
Only last month the Russian company Atomstroyexport won a bid for the project, further consolidating Russia’s grip of Bulgaria’s energy supplies.
Greece, on the other side, is trying to find solutions to cover a power deficit of some 1,000 MW especially during the summer period when electricity demand hits its peak.
Dr Evangelos Lekatsas, chairman of the Hellenic Transmission System Operator sees a two-fold solution, savings of some 700 MW in the summer and the construction of two new units of 150 MW each to be used in peak demand hours.
However, PPC does not fancy the idea that much, simply because the construction will cost and it will take time, while the power deficit Greece is set to face is only some months away.