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Gov't contemplates measures allowing pre-licensing nuclear power sales from Cernavoda Reactors 3 and 4


The Romanian state is considering the approval of support measures for the project of Reactors 3 and 4 of the Cernavoda nuclear power, including the possibility of selling energy before the units obtain the production license, reads the Strategy for the Continuation of the Project of Units 3 and 4 of the Cernavoda Nuclear Power Plant published on the website of Nuclearelectrica.

The document will be submitted for approval to the Nuclearelectrica Extraordinary General Meeting on August 22, 2014, according to the request of the Energy Department for the supplementation of the Meeting's agenda.

The authors of the Strategy argue that the project needs state support, given the high value of the investment and the current context of the power market which is not favorable to investments in large-scale projects.

'In the current economic context and against the current backdrop of the electricity market which does not provide sufficient conditions for accomplishing investments in the necessary major energy infrastructure projects, and in conjunction with the specifics of low carbon energy technologies, often characterized by the need for intensive capital and long achievement periods, the issue is raised of providing underlying mechanisms that facilitate the achievement of large energy infrastructure investments, based on the principles of the free energy market and under observance of the European regulations on transparency, competition and state aid,' reads the Strategy.

Thus, the following set of measures is being currently considered: '(i) the possibility of the project company's contracting electricity before obtaining the producer's license both on the platform of electricity market operator OPCOM and outside it, and (ii) developing a contracts for difference mechanism, a model used in the UK electricity market, intended to support investments in low carbon production capacities,' the Strategy also mentions.

Another method to support this investment is the provision of a state guarantee for securing financing in large energy infrastructure projects that bring economic and social added value, reads the cited document.

The Romanian state will hold a maximum of 49 percent of the company to be set up for the construction of Cernavoda Units 3 and 4.

'Action will be taken to make sure that the joint participation of Nuclearelectrica National Corporation (SNN) and, as the case may be, of the Romanian state, does decrease below 30 percent of the share capital,' the project states.

The strategy provides that in the initial stage, SNN shall initiate, conduct and complete a competitive selection procedure to pick one or several private investors to set up a joint venture with; the value of SNN's investment in EnergoNuclear will be transferred to the newly founded company.

'Increasing the energy capacity of the Cernavoda plant by yet another two units was identified as the optimal solution for covering the energy capacity deficit after 2020, so the project development decision through the Green / Brown Field procedure envisages the speedy start of the actions provided for by the Strategy and reducing investment costs caused by delays in the project's development,' Nuclearelectrica said in a recent release.