Metallurgists become the first investors in nuclear power plants

nuclear power

The Federal Atomic Energy Agency (Rosatom) has moved from promises to attract private investors to build nuclear power plants to action. Yesterday it became known that Rosatom signed memorandums of cooperation with Rusal and SUAL. In the future, this will allow metallurgists to gain access to relatively cheap electricity under fixed long-term contracts in exchange for financing the construction of nuclear power plants. However, they will not be able to begin construction before 2010.

Yesterday, Rusal and SUAL simultaneously announced the signing of memorandums with Rosatom. The documents were signed by the head of the agency, Sergei Kiriyenko, on July 28. They provide that each company will create a commission with representatives of Rosatom, which will select sites for the construction of nuclear power plants and aluminum smelters, develop feasibility studies for projects, calculate the cost and determine the mechanism for investor participation. This is expected to happen before the end of the year.

Both companies need sites near ports. Rusal would like to build facilities in the Far East, in the Arkhangelsk region and on the Kola Peninsula. SUAL is interested in a site in the Far East. The company would also like to build several more units of the Kola Nuclear Power Plant. According to a Kommersant source in Rosatom, “the two sites will be divided between two aluminum companies: one will go to the Far East to build the Primorskaya NPP, and the other will build in the North.” Each nuclear power plant will cost aluminum companies at least $6 billion.

As Kommersant has already written, SUAL has been negotiating to increase the capacity of the Kola Nuclear Power Plant, next to which the company is building the second stage of the Kandalaksha plant, since 2004. At the beginning of this year, after Sergei Kiriyenko’s statement about the possibility of attracting private investors to the construction of nuclear power plants, Rusal also joined the negotiation process with Rosatom. Let us recall that the entire program for the construction of new nuclear power generation until 2015 is estimated at 1.4 trillion rubles. Aluminum workers expect to participate in the construction of new capacities in exchange for futures contracts promised by Rosatom at a fixed tariff for the supply of electricity or with a guaranteed discount. Both Rusal and SUAL have big plans to expand their capacities, and they need electricity. Rusal is going to increase aluminum production to 5 million tons per year, the Voskhod project of SUAL provides for the construction of capacities for 1 million tons.

Rosatom has its own interest in investors. In addition to sources of financing, Rosenergoatom (the state concern that manages all Russian nuclear power plants) receives a long-term consumer whose load regime ideally matches the technological cycle of the nuclear reactor.

The current event is only the first step towards the long-standing idea of metallurgists. But, as they say in Rosatom, aluminum companies will not be able to begin construction of nuclear power plants before 2010, including due to legal restrictions. In addition, Rosenergoatom’s investment program for the next three years has already been planned. Aluminum workers expect to begin construction next year.

It is worth noting that cooperation with Rosatom is not the only project of Rusal and SUAL in the energy sector. Rusal is participating in the construction of the Boguchanskaya hydroelectric power station in Russia and the Rogun hydroelectric power station in Tajikistan. According to Kommersant, it costs more than $2 billion. The owner of SUAL, Viktor Vekselberg, has no less plans. The other day he signed a project with HydroOGK and Hydro Aluminum for the completion of the Bureyskaya hydroelectric power station and the construction of the Nizhnebureyskaya and Nizhnezeyskaya hydroelectric power stations. And yesterday he announced his intention to participate in the construction of a nuclear power plant in the Perm region and the fourth unit of the Perm State District Power Plant. If SUAL simultaneously implements all energy projects, it may face a shortage of funds. It is interesting that a Kommersant source close to Viktor Vekselberg said that it is simply not possible to calculate the required amount of costs for all the announced energy projects.

ALENA Kommersant-KORNYSHEVA, MARIA Kommersant-CHERKASOVA, NATALIA Kommersant-GRib

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