NGOs inform banks about risks - several banks deny interest
The latest delay in the choice of builder for the Bulgarian Belene nuclear power plant late July, was argued with what is the Achilles heel of new nuclear: finances and building times. Bulgarian Economy and Energy Minister Rumen Ovcharov stated that the bids from the two competing consortia Atomstroyexport and Škoda Alliance were too expensive and building times were too long. He criticised that re-use of structures and equipment already delivered for Belene in the late 1980s did not lead to lower prices.
(649.5767) WISE Czech Republic - In the mean time, a coalition of NGOs campaigns banks from which the Bulgarian Government has claimed support for Belene over the last months. The NGOs inform the banks of risks attached to the Belene nuclear power plant which is to be situated in a seismic active area where on 14 km distance in 1977 200 died in an earthquake. The group including the Bulgarian coalition BeleNE! (NO! to Belene), German watchdog Urgewald, Bankwatch, Greenpeace, Campagna per la riforma della Banca Mondiale, WISE/NIRS and Global-2000, also point out that the two bidding consortia are renowned for their budget and time-line overdraws. Škoda Alliance advertises its experience with the Temelín nuclear power plant, infamous for its extended building time (15 years instead of 5), high costs (3,9 Billion Euro instead of the planned 1 Billion) and steady technical glitches as well as highly safety sensitive construction and design problems. Atomstroyexport refers to its present experience in India and China where also building times are overdrawn.
Bayerische Landesbank and the Belgian KBC Group owned Czech bank CSOB, both mentioned in the Bulgarian press as supportive, in letters to the NGOs flatly deny any interest in the project. The Czech Komercní Banka, owned by the Societé Generale Group from France, denies its involvement in spite of being mentioned as part of the Škoda Alliance bid, and states it only would provide finances if the project would fulfil high standards. German Commerzbank was quite explicit in how these standards should look like: the highest global standards in safety, and that according to Commerzbank CEO Klaus-Peter Moeller during the bank's AGM explicitly excluded a nuclear power station built in a seismic active area and with a manipulated Environmental Impact Assessment - this according Greenpeace and WISE/NIRS's nuclear consultant for Central Europe Jan Haverkamp explicitly excludes Belene. CitiGroup from the USA, mentioned as financial leader in the Škoda Alliance, and UniCredit Group, involved over HVB in Germany in the Atomstroyexport bid and over the Czech Živnostenská Banka in the Škoda Alliance, state that they will be very critical during the "due diligence" procedure and will adhere to the Equator Principles according to the rules for a category A investment. Haverkamp: "The manipulations and the low quality of the Environmental Impact Assessment should in itself already be sufficient to dismiss the project under the Equator Principles." Also Deutsche Bank stated it will be careful in its risk assessment of the project. The NGOs are currently increasing their pressure on CitiGroup, UniCredit Group and Deutsche Bank.
That both consortia have come with adapted bids does not impress Petko Kovachev from the BeleNE! coalition and Bankwatch: "It is easy to state shorter building times and lower prices during the bidding process and then increase both later again. That is how both consortia have always worked." A decision in the tender is now expected halfway September. Negotiations for the final contract should finish around the end of the year with building starting early 2007.
Source: Jan Haverkamp, WISE Brno
Contacts: Jan Haverkamp jan.haverkamp@wisebrno.cz and: Petko Kovachev, Bankwatch, petkok@bankwatch.org
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