Czech Republic the latest in nuclear industry death agonies across Europe

Nuclear Revival Dying in Europe as Power Prices Slump: Energy Bloomberg, By Ladka Bauerova – Feb 13, 2013 A Czech atomic-plant expansion planned near the German border had been one of the few prizes left for Europe’s nuclear-power industry after the Fukushima disaster stopped projects from Switzerland to Romania.

Russian and U.S. contractors have prepared to bid for the $10 billion contract to build two new reactors, Europe’s largest competitive tender for a nuclear project. Now a combination of cheaper European power prices and carbon credits, falling demand for electricity and concern government support may falter leaves CEZ AS’s project in doubt, analysts and investors said.

“The future of nuclear energy in Europe looks very dim indeed,” said Mycle Schneider, an independent consultant on energy and nuclear power based in Paris. “Nuclear is too capital intensive, too time-consuming and simply too risky.”Abandoning the Temelin project would deal another blow to the foundering nuclear industry in Europe, and to contractors such as Russia’s Rosatom Corp. and Westinghouse Electric Corp., after the 2011 accident at the Fukushima plant in Japan.

The catastrophe led Germany to set in motion the closure of all its reactors, while Italy and Switzerland dropped building plans. Projects already under way in France and Finland have suffered delays and cost overruns. The Czech Republic and the U.K. were seen as the the two European countries with the strongest commitment to new nuclear plants. Now projects in both countries are in doubt.

“At this point the Temelin project has no market logic,” said Michal Snobr, a CEZ shareholder and an energy adviser to J&T Bank in Prague. “Building the reactors now would be incredibly risky for CEZ and the Czech Republic in general.”

U.K. Plants

Temelin’s future looks even less certain after Centrica Plc bailed out of the plan to build atomic plants in the U.K. on Feb. 4. A day later, Electricite de France SA threatened to do the same unless the U.K. government ensures the project is profitable.

That doesn’t bode well for CEZ, which has cited the U.K. model of government support as an inspiration. The Czech utility is asking the government, its majority shareholder, to guarantee future purchase price of electricity to ensure that it gets return on its investment, Chief Financial Officer Martin Novak said in a Feb. 1 interview in the Bloomberg office.

“The negotiations have only just started,” Novak said. “There has to be a consensus for such a type of support all through the political spectrum that would last a really long time.”…….

Romania Stall

Lack of financing has stalled nuclear projects elsewhere in eastern Europe. Romania is struggling to find investors for its Cernavoda plant. RWE AG, GDF Suez SA, Iberdrola SA and CEZ pulled out of the 4 billion-euro project in 2011. Bulgaria has been unable to lure more investors to its aborted Belene project, estimated to cost at least 6.3 billion euros. The Lithuanian government is reviewing the plan to build a new 1,350 megawatt reactor in Visaginas, which was rejected by voters in a non-binding referendum in October.

Even CEZ has hinted signing a contract doesn’t mean it will go ahead and build the reactors. The company still has three years before actual construction begins, and it may decide to back out of the project before 2017 if market conditions deteriorate further, Novak said…. http://www.bloomberg.com/news/2013-02-14/nuclear-revival-dying-in-europe-as-power-prices-slump-energy.html