Nuclear News Digest Previous issues  
April 2017
  • 24/04/2017

    EU project for nuclear safety for Iran.


     The European Commission has signed the first ever project for nuclear safety co-operation with Iran, under the framework of the Joint Comprehensive Plan of Action (JCPOA).

    The € 2.5 million project aims to enhance the capabilities of the Iranian Nuclear Regulatory Authority (INRA). It will do so by preparing a feasibility study for the Nuclear Safety Centre foreseen in the JCPOA. It will support the INRA in developing a nuclear regulatory framework, working toward the accession by Iran to several international nuclear conventions, including the Convention on Nuclear Safety, and reviewing the results of the stress test to take place in the Bushehr nuclear power plant.

    The project is the first of a € 5 million action approved by the European Union in 2016 under the Instrument for Nuclear Safety Cooperation. A second project for the stress test at the Bushehr nuclear power plant is going to be signed in the coming weeks.

    More information on nuclear safety cooperation with Iran you can find here: https://eeas.europa.eu/headquarters/headquarters-homepage/2281/iran-and-eu_en

     
March 2017
  • 21/03/2017

    Commission clears Belgian support to long-term operation of three nuclear power reactors Tihange 1, Doel 1 and Doel 2.


     The European Commission has found Belgian plans to compensate ENGIE-Electrabel and EDF Belgium for potential financial risks linked to long-term operation of three nuclear reactors to be in line with EU state aid rules.

     In September 2016, the Belgian authorities notified measures related to the prolongation of the operational lifetime of three nuclear reactors (Tihange 1, Doel 1 and Doel 2) to the Commission for assessment under EU state aid rules.

     Under the EU Treaties, Member States are free to determine their energy mix and have the choice to invest in nuclear technology. The Commission's role is to ensure that, when public funds are used to support companies, this is done in line with EU state aid rules, which aim to preserve competition in the Single Market.

     In 2014 and 2015, Belgium concluded two agreements with Engie-Electrabel and EDF Belgium to prolong the operational lifetime of the nuclear reactors Doel 1 and Doel 2 (owned by Engie-Electrabel) and Tihange (owned by Engie-Electrabel together with EDF Belgium). Under the agreements, the companies have committed to invest around €1.3 billion in exchange for authorisation to run the plants for another ten years. The companies would receive financial compensation, if Belgium decides to close the reactors before the end of the ten-year period, modifies the level of nuclear tax to be paid by the owners or changes other economic parameters of the agreements. According to Belgium, nuclear energy requires long-term commitment and these guarantees were necessary to secure the investment of the companies.

     The Commission's assessment found that the investment guarantees provide an economic advantage to Engie-Electrabel and EDF, which goes beyond what they would have been entitled to under general Belgian law. Under EU rules, such state aid has to be limited and proportionate to the objectives pursued.

     The Commission concluded that Belgium has demonstrated that the measures avoid undue distortions of the Belgian energy market. There will be an obligation on Engie-Electrabel, i.e. the major player on Belgian electricity markets, to sell on regulated electricity markets each year a volume equivalent to Engie-Electrabel's share of the annual production of Tihange 1, Doel 1 and Doel 2. It will ensure liquidity on Belgian electricity markets and help increase competition between electricity suppliers. On this basis, the Commission has approved the measures under EU state aid rules.

     The non-confidential version of the decision will be published in the State aid register on the competition website under the case number SA.39487 once eventual confidentiality issues have been resolved. The State Aid Weekly e-News lists new publications of state aid decisions on the internet and in the EU Official Journal.

     Separately, the Commission has also issued today favourable Points of View with a number of recommendations under Article 43 of the Euratom Treaty on the compatibility of the investment projects related to the long term operation of the three nuclear reactors with the objectives of the Euratom Treaty.

     
  • 07/03/2017

    European Commission clears investment in construction of Paks II nuclear power plant in Hungary.

    The European Commission has concluded that Hungary's financial support for the construction of two new nuclear reactors in Paks (Paks II) involves state aid. It has approved this support under EU state aid rules on the basis of commitments made by Hungary to limit distortions of competition.

    Margrethe Vestager, Commissioner in charge of competition, stated: "Hungary has decided to invest in the construction of the Paks II nuclear power plant, its right under the EU Treaties. The Commission's role is to ensure that the distortion of competition on the energy market as a result of the state support is limited to a minimum. During our investigation the Hungarian Government has made substantial commitments, which has allowed the Commission to approve the investment under EU state aid rules."

    Hungary plans to grant investment support for the construction of two new reactors on the Paks site in Hungary. They aim to replace the four reactors currently operating at the Paks site, which were constructed in the 1980s and currently account for approximately 50% of Hungary's domestic electricity production. Hungary considers that the construction of Paks II is necessary to replace phased out generation capacity and to address the need for new capacity.

    Under the EU Treaties, Member States are free to determine their energy mix and have the choice to invest in nuclear technology. The Commission's role is to ensure that when public funds are used to support companies, this is done in line with EU state aid rules, which aim to preserve competition in the Single Market.

    The Commission's state aid investigation found that the Hungarian State will accept a lower return on its investment than a private investor would do. The investment therefore involves state aid within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union (TFEU). These rules require state aid to be limited and proportionate to the objectives pursued in order to be approved.

    Hungary has demonstrated that the measure avoids undue distortions of the Hungarian energy market. In particular, it has made a number of substantial commitments to limit potential distortions of competition:

    a) To avoid overcompensation of the operator of Paks II, any potential profits earned by Paks II will either be used to pay backHungary for its investment or to cover normal costs for the operation of Paks II. Profits cannot be used to reinvest in the construction or acquisition of additional generation capacity.

    b) To avoid market concentration, Paks II will befunctionally and legally separated from the operator of the Paks nuclear power plant (the incumbent MVM Group) and any of its successors or other state-owned energy companies.

    c) To ensure market liquidity, Paks II will sell at least 30% of its total electricity output on the open power exchange. The rest of Paks II's total electricity output will be sold by Paks II on objective, transparent and non-discriminatory terms by way of auctions.

    On the basis of the above, the Commission has approved the measure under EU state aid rules because the amount of aid is limited and proportionate to the objectives pursued, while the distortion of competition caused by the state support is minimised.

    Background

    Article 2(c) of the Euratom Treaty provides that the Union shall “facilitate investment and ensure, particularly by encouraging ventures on the part of undertakings, the establishment of the basic installations necessary for the development of nuclear energy in the Community”.

    In May 2015 Hungary notified to the European Commission for assessment under EU state aid rules its planned investment into the construction of two nuclear reactors (VVER 1200 (V491)) at the Paks site. Hungary notified the measure with the aim of obtaining legal certainty, stating that the project involved no state aid within the meaning of Article 107 TFEU, as the measure could be implemented by any economic investor in the market under similar conditions. The Commission opened an in-depth state aid investigation in November 2015.

    Separately, the Commission in November 2016 closed the infringement case against Hungary regarding the compatibility of the Paks II nuclear power plant project with EU public procurement legislation.

    The non-confidential version of the decision will be made available under the case number SA.38454 in the State Aid Register on the DG Competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.

     
February 2017
  • EU and IAEA agree to strengthen cooperation during 5th Senior Officials Meeting.



    The European Union and the International Atomic Energy Agency (IAEA) took steps to strengthen their cooperation in a range of nuclear activities including nuclear science applications during the fifth annual Senior Officials Meeting (SOM) in Brussels this week.

  • The talks on 15 February 2017 at the EU headquarters provided a forum to exchange views on enhancing collaboration in nuclear safety, security, safeguards, sustainable development and nuclear energy research and innovation and nuclear science applications. In addition, mechanisms to strengthen regional cooperation were discussed, including for the environmental remediation of uranium legacy sites in Central Asia. There were exchanges on the 2017 PrepCom of the Treaty on the Non-Proliferation of Nuclear Weapons (NPT).

  • The EU continues to attach great importance to the IAEA's core responsibilities in the field of non-proliferation, nuclear energy, nuclear safety, nuclear security and technical cooperation. The strong political support by the Union and its Member States is backed also financially and technically.

    The EU and the IAEA continue to strengthen their cooperation. The SOM was a good opportunity to review progress and to discuss next steps in priority areas, in particular support to Member States in implementing the Sustainable Development Goals. The meeting was co-chaired by Marco Giacomini, Deputy Managing Director for Human Rights, Global and Multilateral Issues on side of the European Union and Cornel Feruta, Chief Coordinator for the International Atomic Energy Agency. Senior officials of DG Energy and DG DEVCO also participated.

    The SOM acknowledged that nuclear safety is a key priority that will remain at the centre of cooperation between the EU and the IAEA. Participants reiterated their willingness to work towards an ambitious implementation of the Vienna Declaration supporting continuous safety improvements for countries that operate or are building new nuclear power plants, including in the EU neighbourhood. The EU emphasized that issues linked with the back end of the life cycle of nuclear facilities, such as decommissioning and radioactive waste management, should receive additional attention and benefit from increased stakeholder involvement with a focus on increasing transparency on funding and processes leading to national and/or shared repositories.

    The EU and the IAEA reaffirmed support for the Joint Comprehensive Plan of Action (JCPOA) based on their respective mandates. The EU High Representative, as Coordinator of the Joint Commission established under the JCPOA, will remain in close contact with the IAEA regarding continued implementation of the agreement. The EU will provide technical support to the IAEA such as equipment and training. The EU also informed about its bilateral cooperation with Iran in implementation of Annex III of the JCPOA, particularly in the area of nuclear safety including research.

     EU support for a variety of IAEA activities has delivered consistent and concrete results in several important areas, including global assistance projects. In the margins of the SOM, Aldo Malavasi, Deputy Director General for Nuclear Sciences and Applications for the IAEA and Vladimir Sucha, Director General of the Joint Research Centre of the European Commission, signed practical arrangements on cooperation in the field of nuclear science and applications for sustainable development.

    Nuclear security was also on the agenda, with talks focused on how to achieve more effective and sustainable measures, including the Union support for IAEA activities in the area of nuclear security, strengthening the security of nuclear and radioactive materials, building on the results of the 2016 International Conference on Nuclear Security and preparations for the International Conference on Physical Protection of Nuclear Material and Nuclear Facilities. Developments regarding the IAEA LEU Bank in Kazakhstan, including continued EU support, were also discussed.

January 2017
  • Commission approves restructuring plan of French Areva group.



    The European Commission has concluded that French plans to grant a capital injection of €4.5 billion to Areva are in line with EU state aid rules. Areva's restructuring plan will allow the company to become viable without unduly distorting competition in the Single Market.

    The payment of the state aid is subject to conditions, in particular a positive conclusion of the ongoing tests by the French Nuclear Safety Agency concerning the nuclear reactor vessel of Flamanville III, and an approval of the divestment of Areva's reactor business under EU merger rules.

    Margrethe Vestager, Commissioner responsible for competition policy, said: "Today's decision paves the way for a viable future for Areva based on a sustainable restructuring plan. The plan strikes the right balance between improving the group's competitiveness and limiting distortions of competition created by the public financing".

    In April 2016, France notified to the Commission, for assessment under EU state aid rules, a restructuring plan to restore Areva's competitiveness. The plan provides for various divestments, in particular the group's nuclear reactor business. Areva will instead focus its activities on the nuclear fuel cycle, i.e. the upstream and downstream activities and services involved in the production of electricity from uranium in nuclear power reactors. France plans to help Areva bear the cost of restructuring by injecting public capital in the amount of €4.5 billion.


    EU Member States are free to determine their preferred energy mix. The Commission's responsibility under EU state aid rules is to make sure that public financing does not unduly distort competition in the Single Market. To verify this, the Commission opened an in-depth investigation in July 2016. The Commission assessed in particular whether the assumptions underlying Areva's restructuring plan were sufficiently realistic to enable the group to become viable again in the long-term without continued state support.

    The Commission's investigation showed that Areva's withdrawal from the nuclear reactor business will allow the group to focus on a clear and profitable business in the nuclear fuel cycle. This is demonstrated by the financial projections of the newly created group.

    The complete divestiture of Areva's reactor business will significantly reduce the group's activities in the nuclear sector and thereby limit the distortions of competition brought about by the state support. A competitive Areva will also contribute to ensuring Europe's security of uranium supply.

    The Commission also found that Areva will finance a significant part of the restructuring costs with proceeds from planned asset sales, including the divestiture of Areva's reactor business (New Areva NP) to the French energy incumbent EDF. The contribution is subject to the Commission's review of the planned transaction under EU merger control rules. It is also subject to the positive result of tests, performed at the request of the French Nuclear Safety Agency, on the Flamanville III nuclear reactor vessel, which is supplied by Areva. The restructuring aid may not be paid until then. Therefore, the Commission has also approved today a loan amounting to €3.3 billion from the French State to Areva. This loan aims at bridging Areva's liquidity needs until the capital injection can take place.

    The French authorities will submit regular monitoring reports to the Commission, to ensure that the restructuring plan is implemented in full and in line with today's decision, until the restructuring period of Areva comes to an end in 2019.

    The Commission therefore concluded that Areva's restructuring plan was in line with EU state aid rules, subject to the effective divestment of the group's nuclear reactor business.


         ESA Nuclear Observatory

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