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The move seems a revival of Rosatom’s declarations in the past several months that it would begin to move nuclear power in Russia into private hands – or at least give private hands a large burden in helping fund its projects.
Just last week, Russia announced it would offer foreign countries a 49 percent stake in the as-yet-be-built Baltic Nuclear Power Station in Russian enclave of Kaliningrad. It has indeed become clearer that Kaliningrad’s energy needs can be covered without the nuclear plant and that it would be built almost entirely to export power.
Russia’s inability to raise funding for this plant have become notorious over the last several months, but Rosatom and the Kaliningrad Regional government have slapped a smile on the difficulties by holding festivals and public gatherings to extol the economic bonanza it would bring.
Meanwhile, Russia’s Teksnabekport was able to break through uranium trade tariffs with the United States and arrange for the direct sale of uranium fuel to American nuclear utilities starting in 2013, scuttling the Megatons to Megawatts non-proliferation programme that brought down-blended weapons uranium from Russia for use in US commercial reactors. Megatons to Megawatts has run some 40 percent of US reactors, and figures for Russian uranium being burned in US reactors is expected to rise.
More broadly, 2008 saw the transformation of Russia’s Rosenergoatom – which runs all 10 of Russia’s nuclear power plants – transformed into the joint stock company Energoatom in order to attract both state and private investment. Energoatom’s charter capital is about 318.3 billion roubles ($12.9 million).
In conjunction with the creation of Energoatom, some 55 federal state unitary enterprises will be auctioned off within the framework of reforms within Russia’s nuclear industry.
Russia craves a move to more private funding – most of which will remain largely under state control – as the world wide financial grinds away at the lavish government funding that Rosatom is used to receiving.
The moves toward privatising sectors of the nuclear industry have been widely condemned by Russian environmentalists, including Vladimir Slivyak, co-chair of Russia’s Ecodefence and a regular commentator on Bellona Web, who said Russia tax payers will still bear the burden of Russia’s hopes of a nuclear build-out, while officials stash private funding in their pockets.
“A significant portion of the industry will remain unprofitable and we will continue to finance that from the state budget,” said Slivyak.
“Another portion will be acquired by Rosatom brass or their friends, and hidden in offshore accounts,” he said.
Slivyak said that the privatisation of nuclear power in Russia is dangerous because it could lead to weakened control over how radioactive materials are handled.
“Russia does not have a law tried in practice that regulates issues of handling nuclear materials. Therefore, in conditions of privatisation, there is a possibility that dangerous substances will fall into the wrong hands,” he said.
Technically speaking, the Russian government structure that deals with regulating the nuclear industry, the Russian Federal Service for Ecological, Technical and Atomic Supervision, or Rostekhnadzor, has been overridden by Rosatom’s own supervisory bodies.
This means, according to Rostekhnadzor spokesman Yevgeny Anyushin, that, “(an) orgnasation that needs monitoring monitors itself,” he told Bellona Web.
The new mining effort for Atomenergoprom to go nearly half private is in tune with these privatisation efforts within Russia’s nuclear industry.
Atomenergoprom may seek to sell the five-year notes in 10 parts via the Micex Stock Exchange in Moscow, the currently state-run company said in a statement yesterday.
A successful sale would be the biggest – and, so far, one of a handful – by a Russian utility or nuclear company.
Russian companies are relying more on domestic borrowing after being shut out of international markets amid the global credit squeeze. Corporate bond sales in roubles are outpacing sales in foreign currencies this year for the first time since 2006, the Bloomberg financial news wire said.
Prime Minister Vladimir Putin said in April that Russia needs to build at least 26 nuclear reactors before 2030 to cut reliance on natural-gas-fired generation. Atomenergoprom’s Atomstroyexport unit, which builds reactors abroad, has contracts to build reactors in China, India, Iran, Bulgaria and is in talks with Turkey.
Atomenergoprom will sell five issues of 30 billion rubles each, four issues of 10 billion roubles and one of 5 billion rubles set to mature in 2014, said Bloomberg.
The cash raised will help refinance short-term debt and pay for projects to upgrade Russian power plants, develop new uranium fields, and install the latest centrifuge equipment at enrichment plants, Kirill Komarov, executive director of Atomenergoprom, said in yesterday’s statement.
But the larges-scale privatisation sweep makes no mention of whether any bodies falling under the umbrella will be responsible for enforcing safety, including paying for upgrades – which often simply become engineering life span extensions on old reactors that should be shut down.