Rosatom deal with Hungary faces derailment for violating open tender stipulations

paks control room The control room at the Paks nuclear power plant in Hungary. Credit: ChNPP

The European Commission is reportedly striking down a project to build two new reactors for Hungary’s Paks nuclear power plant in a deal awarded to Russian state nuclear corporation Rosatom, representing a major victory for Russian and European anti-nuclear campaigners.

The Hungarian daily Nepszabadsag, as cited by Reuters, said Janos Lazar, Hungarian Prime Minister Viktor Orban’s chief of staff, has confirmed suspension of the €12.5 billion euro construction-and-finance deal to build two Russian VVER-1200 reactors.

At issue are European Commission regulations forbidding that Rosatom be awarded the contract without a tender. The deal between Hungary and Rosatom that was signed in January 2014 was, according to Vladimir Slivyak, co-chair of Russia’s Ecodefense, was non-competitive.

Chief of Staff Lazar was reported as saying Hungary had not received official notices of the project’s suspension, but an unnamed source told Nepszabadsag it was a done deal.

The Paks plant, which was built by the Soviet specialists, went online in 1982 operating two VVER-440 reactors. It is Hungary’s only nuclear power plant.

Slivyak added in his blog on the subject that the €10 billion of the €12 billion project would have been financed in the form of credit extended from Russia’s national budget. Construction of the two new units was to begin in 2018.

“Rosatom is trying to export expensive and dangerous nuclear reactors on Russia federal budget money,” Slivyak wrote. “All credit paybacks are planned for the distant future, and by existing practice, part of these expenses would be written off by the [Russian] government.”

He added that: “In a time of heavy economic crisis, it would be well to cancel such practices.”

Of further concern, said Slivyak, are the untested VVER-1200 reactors Rosatom planned to build for Paks. Nowhere in the world is this reactor type in operation, and four are currently only under construction at Russia’s Baltic nuclear power plant and Novovoronezh’s second nuclear station.

In both instances, construction of the reactors has been delayed indefinitely.

The VVER-1200’s predecessor, the VVER-1000 has had its spate of problems: In 2011, Ecodefense uncovered video revealing a hydrogen explosion at the Kalinin nuclear stations No 3 reactor, a VVER 1000 that took place in 2011. The same reactor ype experienced radioactive water leaks at the Kalinin Plant, Slivyak said.

Today’s announcement that the Hungarian expansion is likely off the table is not the first time the Paks-Rosatom deal has run into trouble.

In March 2015, the European Atomic Energy Community, or Euratom, raised issues with the deal’s stipulation that only Rosatom would supply Paks with nuclear fuel for the duration of its prospective 60 year operation, Sliyak wrote.