The Sierra Club of Canada has denounced a risky request for $390 million in Canadian taxpayer funds to finance a second CANDU reactor in Romania. Public interest groups in Europe are also calling on their respective governments, export credit agencies and the European Commission to oppose loans for the Cernavoda-2 CANDU reactor in Romania.
One CANDU reactor (Cernavoda-1) has been operating in Romania since 1996, but the Cernavoda-2 reactor is only 20 to 40% complete, and will require an investment of over $1 billion CDN ($700 million US) to make it operational. The Canadian government’s nuclear company, Atomic Energy of Canada Limited (AECL) is a partner in the project with Ansaldo Nucleare, a state-owned Italian nuclear company. AECL and Ansaldo hope for financing from three sources.
AECL is seeking about $390 million CDN ($250 million US) in financing from the Canadian government’s export credit agency, the Export Development Corporation (EDC). Ansaldo is seeking $150 million Euros (about $210 million CDN) from the Italian export credit agency SACE. The Romanian state nuclear company Societatea Nationala Nuclearelectrica has asked for a loan of $350 million US (about $550 million CDN) from EURATOM, the European Atomic Energy Community. Decisions on all three controversial loans are imminent.
In Canada, the huge $390 million loan would be administered by the EDC, but would be a “Canada Account” loan, made directly from the government’s main operating account, the Consolidated Revenue Fund, because it is too risky for private sector financial institutions or the normal corporate transactions of the EDC. The Cabinet has already given support in principle for the loan, and Government House Leader Don Boudria headed a hush-hush Canadian delegation to Romania last October 8-11 to offer official support for the project. In March 1999, 164 members of parliament — a majority of MPs including one third of the governing Liberal party — came out publicly against federal government financial support for Cernavoda-2. EDC refuses to disclose any details, but in response to the EDC approval process, AECL has released an environmental assessment document for a 45 day public comment period that began on December 1st. In Italy, environmental and globalization activists are demonstrating at the SACE headquarters in Rome today against possible support for the Cernavoda-2 project. They claim that the financial support violates the terms of a 1987 national referendum in Italy that forbade support for new nuclear power plants.
The $550 million EURATOM loan is also controversial. The European Atomic Energy Community (EURATOM) is the joint European Union agency established in 1958 to promote nuclear power. In 1994, EURATOM loans outside of member states were restricted to projects “for improving the degree of safety and efficiency of nuclear power stations”. This was clearly aimed at Eastern European reactors built by the former Soviet Union, and would not seem to apply to a new CANDU reactor in Romania. European Union enlargement Commissioner Gunter Verheugen is scheduled to visit Romania on December 17th. The safety of Soviet-era nuclear reactors has a been a high profile hurdle for admission of former Soviet block countries to the Union.
Romania has no need for the electricity from the Cernavoda-2 reactor. Installed generating capacity is already about three times peak demand.
Dave Martin, Nuclear Policy Advisor for the Sierra Club of Canada, stated:
“The Romanian reactor loans are risky deals for an unsafe technology in a country where the electricity is unneeded. Romania already has twice the generating capacity that it needs.”
“The economic viability of the Cernavoda-2 reactor will depend entirely on un-confirmed electricity export deals. Nuclear power is a high-cost energy source with environmental and safety problems. It does not deserve international financial support.”
“Typical of AECL, it has conducted a grossly inadequate environmental assessment on the Cernavoda-2 project, and is trying to minimize public comment by posting the document over the winter holidays.”
