site.btaReport: Belene N-Plant Project Is Viable at Price of EUR 10.5 Bln

Sofia, November 16 (BTA) - Given an investment expenditure of 10.5 billion euro, a 70:30 ratio between attracted and own capital, and an interest rate of maximum 4.5 per cent, the Belene N-Plant project is viable, reads a Bulgarian Academy of Sciences (BAS) report on the options for utilization of the Belene N-Plant project assets. The report was presented at the BAS on Thursday by Prof. Alexander Tassev, Director of the Economic Research Institute with the BAS and head of the project.

Prof. Tassev said that the market risk cannot possibly be measured exactly and will always exist, but two-thirds of the BAS' models show that there are grounds to build the nuclear power plant and that the Belene project will be well-founded financially. According to him, the State's participation improves significantly the project's viability. In his words, it is good for the producer of the plant's equipment and the plant's builder to be one and the same.

The BAS' report of nearly 1,000 pages provides several scenarios for the development of the energy sector in Bulgaria and the region. In Prof. Tassev's words, most of these scenarios include future shortage of basic energy capacity, which could be nuclear as well.

Three scenarios for the development of the Bulgarian economy by 2030 are outlined in the report. The first conservative scenario forecasts almost no change to the country's economic development, an economic growth of 2.5-3 per cent and no significant change in electricity consumption.

The second more scenario projects a 3-4 per cent growth and a 25 per cent increase of current electricity consumption.

The third scenario envisages growth of between 3.5 and 6 per cent. "Without tighter decarbonization requirements and stricter environmental rules for fewer harmful emissions Bulgaria's generating capacities can continue to operate by 2040," said Tassev. Currently there is an overproduction of electricity but after 2040 the excess will be used up, he added. Between 2047 and 2050 the reactors at Kozloduy will shut down and they can be replaced by the new reactors at Belene.

The BAS report has forecast a scenario with stricter decarbonizaton requirements under which it will be harder for coal-fired thermal power plants to stay on the free market. In these circumstances Bulgaria will need new generating capacities after 2035.

The analysis says that if the European Commission continues along the road of green energy around 2030 it will need new generating basic capacities.

Tassev said that the Balkan region is experiencing electricity shortages. If all Balkan countries implement their projects for new capacities, in 10 to 20 years there will be minimum shortages, whereas in the other two cases there will be serious electricity shortages. Turkey has not been included in the scenarios and if it continues to be such a large consumer, there will be steeper electricity shortages.