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New study sounds the alarm on safety in Ukrainian nuclear power plants operated beyond their design lifetime

Prague, Kiev – In December 2013, Ukraine’s State Nuclear Regulatory Inspectorate (SNRIU) has granted a 10 years lifetime extension license to unit 1 in the South Ukraine nuclear power plant. But a new independent study reveals critical vulnerabilities in the 32 year old nuclear unit that could have dangerous ramifications.

The study was conducted by CEE Bankwatch’s member organisation the National Ecological Centre of Ukraine (NECU) together with technical experts, and an English language summary can be found at
https://bankwatch.org/sites/default/files/summary-SUNPP1-safetystandards-17Mar2015.pdf

Three of Ukraine’s nuclear energy units are already operating beyond their design lifetime, and nine others are expected to be given similar permissions by the State Nuclear Regulatory Inspectorate (SNRIU) by 2020.

Upgrades, necessary to enable lifetime extensions for these units, are partially financed [1] by loans from the European Bank for Reconstruction and Development (EBRD) and the European Atomic Energy Community (Euratom) totalling EUR 600 million.

The new study shows the reactor pressure vessel in unit 1 has several dangerous vulnerabilities that could lead to the appearance of micro-cracks in the vessel’s metal casing. According to the study authors, observed wear in a number of elements in the reactor vessel already exceeds tenfold tolerable levels.

Such vulnerabilities, the study warns, could result in a nuclear emergency, including a release of radioactivity inside the unit, or even to the environment in a worse case, if the unit is operated beyond its design lifetime. And since the reactor pressure vessel cannot be upgraded or replaced, its technical condition essentially determines the lifetime of the entire nuclear unit.

The new study also found, that the structural assessment of the reactor vessel was not performed fully, and the state expert’s review of nuclear and radiation safety lacked substantiation.

In addition, as part of a governmental decision to suspend all state regulation in Ukraine (with the exception of tax authorities), as of January 2015 SNRIU is prevented from conducting any safety inspections on their own initiative in nuclear energy facilities across the country. And given the current military conflict in the east of the country, the risk is particularly high.

“These findings cast serious doubts over the SNRIU’s ability to ensure the safety of Ukraine’s nuclear fleet,” says Iryna Holovko, CEE Bankwatch Network’s national campaigner for Ukraine. “It is insane to leave nuclear installations without state control. It is also a clear violation of the conditions attached to the EBRD loan. The loan became effective as of December 2014 and it is an important instance for the EBRD now to demonstrate its leverage on the Ukrainian government in the area of nuclear safety.”

In February NECU have raised their concerns on this issue with the EBRD in a letter to the Bank’s president (see here: https://bankwatch.org/publications/letter-ebrd-nuclear-inspections-must-continue-ukraine). The Bank has acknowledged that such limitation to SNRIU’s independence contravenes the conditions of the loan agreement with the EBRD.

Nuclear power plants generate almost half of the electricity supply in Ukraine. The country is almost completely dependent on Russia for its nuclear fuel as well as treatment and storage of most spent nuclear fuel.

Unit 2 in the same South Ukraine nuclear power plant will reach the end of its design lifetime on May 15. By the end of April, SNRIU will have to make a decision on a 20 years lifetime extension license for this unit.

Based on the study findings, NECU demands that Energoatom and SNRIU carry out a comprehensive assessment of nuclear and radiation safety in the South Ukrainian nuclear power plant’s unit 1.

“If the results of this additional comprehensive assessment are negative, SNRIU should cancel the lifetime extension license for South Ukraine Unit 1,” says Tatiana Verbytska, energy police expert at NECU. “It is essential to ensure that decisions to extend the lifetime for South Ukraine’s Unit 2 and Zaporizhia’s Unit 1, expected to be made by SNRIU this year, are based on full data and truly comprehensive assessments. The price of the mistakes in nuclear safety assessments is too high for Ukraine to bear, especially under the current economic situation and a de-facto war in the east of the country.”

Notes for the editors:

1. The first four tenders within the nuclear safety upgrade program, started by the Energoatom under the EBRD tendering procedures, include measures at South Ukraine unit 3 and at four units at the Zaporizhia nuclear power plants. Most of these units expire by 2020 and are planned for prolonged operations.

For more information contact:

Iryna Holovko
National campaigner for Ukraine, CEE Bankwatch Network
iryna@bankwatch.org
Tel.+380 50 647 6700

Tatiana Verbytska
Energy policy expert, NECU
tanya@necu.org.ua
Tel. +380 93 775 0580

Victories piling up: 130 more hectares of forest saved from lignite mining in Romania

Bucharest – A Romanian court has accepted a petition filed by Bankwatch Romania and Greenpeace Romania, and cancelled the environmental permit which allowed cutting down 130 hectares of forests – equivalent to approximately 260 football pitches – to make way for the expansion of the Pinoasa lignite open pit.

The two organisations filed this court case in 2013, because the environmental permit issued by the Gorj Environmental Protection Agency only assessed the environmental impact of the deforestation, without a proper evaluation of the lignite extraction activity, which is the actual project.

Located in Romania’s southwest, the mine is owned by the state company Oltenia Energy Complex (OEC).

The environmental permit did not oblige OEC to compensate the land owners, as required by law. It also did not evaluate cumulative impacts of Pinoasa lignite quarry’s expansion together with ten other similar projects planned by OEC in the Rovinari area. Such impacts include exposure to air pollution, noise, risk of landslides, loss of habitats and others.

No social or health impacts analyses have been carried our either, although the mines’ expansion doesn’t make only forests disappear, but neighbouring villages too. In fact, a large part of the village of Timiseni has already vanished from the face of the Earth to allow the development of the Pinoasa pit. See a map here:
http://wikimapia.org/#lang=ro&lat=44.886587&lon=23.126307&z=14&m=b

“The Oltenia Energy Complex still refuses to acknowledge the legal requirement to conduct an environmental impact assessment, in spite of an infringement procedure opened by the European Commission against the Romanian Government [1] and the previous national courts’ decisions[2],” says Cătălina Rădulescu, the lawyer representing the two NGOs and a member of Bankwatch Romania. “The state owned company insists on referring to 40 year old legislation, from when the first lignite operations started developing in the region. We demand the company carries out environmental and social impact assessments for all its lignite mines’ operating licenses, abiding by today’s environmental protection legislation.”

“Forests play a crucial role in CO2 absorption, the gas with the highest contribution to climate change. The Oltenia Energy Complex wants to cut down forests to extract coal, which it would then burn in its thermal power plants, causing a double environmental damage,” adds Ionut Cepraga, campaign coordinator with Greenpeace Romania. “We argue that currently Romania has plenty of clean energy resources to quit burning coal, and this should also be reflected in the country’s National Energy Strategy, currently under preparation.”

This is the latest legal victory in a series which has so far annulled 27 deforestation permits, preventing the clearance of 22 hectares of forest for the expansion of the Rosia open-pit. The court has also ordered the cancelling of another environmental permit, thus saving 59 hectares of forests near Tismana 1 lignite quarry. Nine other, similar cases are pending a court decision.

Yesterday’s court decision is yet to be formally transmitted to the parties. The defendants, the Gorj Enviornmental Protection Agency and the Oltenia Complex, can appeal the ruling within fifteen days of its notification.

For more details, please contact:

Ionuț Brigle
Campaign coordinator, Bankwatch România
ionut.brigle@bankwatch.org

Cătălina Rădulescu
Lawyer
catalina.radulescu@gmail.com

Notes for the editors

1. On the decision of the European Commission to open an infringement procedure against Romania: https://bankwatch.org/news-media/for-journalists/press-releases/european-commission-opens-infringement-procedure-against-r

2. On the previous court rulings: https://bankwatch.org/news-media/blog/forests-sitting-lignite-saved-romania and https://bankwatch.org/news-media/blog/bankwatch-stops-cutting-another-22-hectares-forest-coal-mining-romania

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Image credits: Mihai Stoica

EIB’s new transparency policy allows for more secrecy

Brussels – Yesterday the European Investment Bank (EIB) formally adopted a revised transparency policy including controversial exceptions to the disclosure of internal documents. This watered down transparency policy comes right before the bank will start implementing the € 315 billion Juncker plan and risks undermining the impact of EU recovery efforts.

The new transparency policy has been met with strong criticism from civil society organisations [1] because it would allow the EIB to establish a new presumption of confidentiality to keep secret internal investigations into irregularities such as corruption and maladministration.

Read also

European Parliament intergroup ITCO condemns new transparency policy of the European Investment Bank
Blog post | March 13, 2015

The exceptions also alarmed some of the Directors of the Bank (the Directors are representatives from the Member States who meet monthly to approve projects and the policies which guide the bank) who could not come to an agreement on the adoption of the final policy during their last meeting on 3 February 2015.

According to sources within the bank, it is the first time that there was no agreement on the adoption of a final policy proposed to the Board of Directors, illustrating how controversial this new policy is. During the public consultation process regarding the policy, the European Ombudsman’s representative also recommended against including the exceptions on of internal documents.

Despite the controversy surrounding the new policy, the EIB decided not to take into account the concerns raised and only made a minor cosmetic change to the policy before adopting it yesterday.

Xavier Sol, Counter Balance Director, said:

“Transparency is widely recognized as a precondition for good governance. The EIB’s new transparency policy comes right before the bank is expected to get Europe’s economy back on track by implementing the Juncker investment plan. The bank’s move towards secrecy might seriously undermine these efforts.”

Anna Roggenbuck from Bankwatch said:

“The new policy casts serious doubts over the bank’s commitments to improve transparency and may further undermine its already bad reputation given its terrible rankings on the yearly published Aid Transparency Index [2]. A number of cases in the past have shown the bank is very reluctant to proactively disclose proactively information of public interest and only acts under external pressure such as from the European Ombudsman [3]. European citizens deserve a much more transparent and accountable public investment bank.”

Toby Mendel, Executive Director of the Centre for Law and Democracy, added:

“It is most unfortunate that the Bank is moving backwards on this core democracy issue while other international financial institutions have been putting in place much stronger transparency policies. This is particularly ironic given the historic commitment of the European Union and its Member States to openness.”

Notes for editors:

1. Read here about the critiques to the new transparency policy:
http://www.counter-balance.org/eib-set-to-weaken-transparency-standards/

2. Year after year the EIB scores very low when it comes to transparency. Last year it ranked second to last of all financial institutions on the Aid Transparency Index

3. Read here about a recent case showing the bank reluctance to disclose crucial information:
http://www.counter-balance.org/long-awaited-investigation-into-glencore-for-alleged-tax-dodging-shows-eu-banks-lack-of-transparency-and-vulnerability-to-abuse/

For more information contact:

Xavier Sol
xavier.sol@counter-balance.org
+32 2 893 08 61

Anna Rogenbuck
annar@bankwatch.org

South eastern European countries must take climate action or face hefty bills, says new report


Prague, Belgrade, Kiev, Podgorica, Sarajevo, Banja Luka – Countries of the Energy Community [1] risk wasting hundreds of millions of Euros on outdated energy infrastructure if they do not adopt policies to tackle climate change, finds a new report released today by CEE Bankwatch Network and partners in four countries across the region.[2]

The report, commissioned by CEE Bankwatch Network and carried out by think-tank Change Partnership, is available at:
https://bankwatch.org/sites/default/files/EnCom-strategy-climate-action.pdf

The real costs of the planned increase of coal power generation, currently on the table in most Energy Community countries, will have significant impacts on their long term development, according to the study.

So far, none of these countries have adopted carbon pricing policies or taken them into account in their investment plans, but they will have to do so by the time of EU accession.

The new analysis shows that at current EU emission permit prices (Euro 5 per tonne of CO2), existing coal and gas power plants in the region will cost governments at least EUR 575 million each year.

And if materialised, the planned coal energy infrastructure would add additional EUR 133-317 million annually. If carbon prices rise to Euro 30 per tonne of CO2 – as expected to happen by 2025 as a result of a set of measures planned nowadays – these projects’ carbon price tag will soar to EUR 790 million – EUR 1.9 billion every year.

Right now Bosnia and Herzegovina, Macedonia, Kosovo, Montenegro, Serbia and Ukraine are planning to build a total of 14.82 GW of new coal power capacity, much of which would be additional to existing capacity.

By contrast, dropping the plans to build any new coal fired electricity capacity and replacing it with wind power generation, for example, would cost the region 25% less on average, by 2030. [see Figure 15 in the report]

Furthermore, the region is wasting a vast amount of electricity in transmission and distribution. According to the report, reduction of current electricity losses could bring financial benefits to all these countries worth approximately EUR 1.7 billion annually by 2030.

“The Energy Community needs to provide clear guidance on clean and cost effective energy investments in its contracting countries. Otherwise, the region would be put at an economic disadvantage, while the EU continues to decrease the use of fossil fuels in its electricity mix,” says Ioana Ciuta, energy coordinator with CEE Bankwatch Network. “There is no better time than now for these countries to shape inclusive, safe, clean and lower cost energy systems which the European Union itself is building at present, for millions of citizens.”

“The Energy Community needs to start taking climate issues much more seriously and deliver a 2030 vision which integrates the core EU social and environmental legislation into the region,” says Sanjeev Kumar of Change Partnership. “We expect the EU, which stands at the heart of the Energy Community to take immediate action in this regard.”

The findings in this report are of particular importance for those countries in the Balkan region and Ukraine that, in fact, plan much of their new-build electricity capacity for exports across the region and beyond. A dedicated comprehensive report, to be released by CEE Bankwatch on March 19, will outline the threat that such investments end up as stranded assets which are uneconomic to operate.

For more information contact:

Ioana Ciuta
Energy Coordinator, CEE Bankwatch Network
ioana.ciuta@bankwatch.org
Tel.: +40 724 020 281

Notes for the editors:

1. Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Moldova, Montenegro, Serbia and Ukraine.

2. The National Ecological Centre of Ukraine, the Centre for Ecology and Sustainable Development (Serbia), Green Home (Montenegro), and the Center for Environment (Bosnia and Herzegovina)

Southeastern Europe deserves a better energy future – and now is the time to ensure it happens


Brussels, Prague, Sarajevo – The revision process of the Energy Community Treaty [1] is entering its final lap these days, offering a real opportunity to transform member countries’ energy landscape. More than one year since the start of the Treaty revision, the second round of public consultations is closing today.

A number of proposals from the European Commission fall short of the original goals of the treaty – primarily, to bring energy, environmental and climate standards in southeastern Europe in line with the EU’s – but civil society groups, in comments submitted today, argue that the new Energy Community can and should seize the opportunity to achieve this.

In June 2014 the High Level Reflection Group (HLRG) [2] released a recommendations report that was overall environmentally progressive.

The European Commission tabled its own set of proposals for reform (pdf) based on input from the Member States. Yet, unfortunately, some aspects of this version, if adopted, could allow the countries of the Energy Community to fall behind on EU energy, environmental and climate standards.

“For example, the Commission’s text suggesting it would be too difficult for Energy Community countries to transpose the EU’s Air Quality Directive is essentially going against everything that EU climate and energy policies stand for,” says Ioana Ciuta, Energy Co-ordinator at CEE Bankwatch Network.

Heavy reliance on coal burning for electricity in southeastern Europe has also meant a heavy toll on public health. A recent study by the Tuzla-based Center for Ecology and Energy estimated that in 2013, coal power plants in Bosnia and Herzegovina’s Tuzla region, for instance, caused the loss of approximately 4900 years of life, 131,000 lost working days due to heart and respiratory illnesses and around EUR 61 million in economic cost.

But this is not a given. In their input submitted today to the public consultation, a group of 18 leading NGOs [3] active in the Balkans region is insisting that the treaty’s review is an opportunity to bring to southeastern Europe the energy and climate policies these countries deserve to make substantial and sustainable development.

“It’s not just about promoting any energy investment, but rather about advancing carefully chosen energy sources,” says Garret Tankosić-Kelly, SEE Change Net Principal. “If the Energy Community doesn’t have increased monitoring and enforcement capacity, energy investments currently planned could end up infringing EU acquis or become stranded assets in the medium-long term.”

Therefore, a serious reform of the Energy Community’s institutions is needed, and particularly the Secretariat which is currently lacking sufficient staffing in the environment and social fields.

“The Energy Community needs to develop beyond merely serving the business sector,” concludes Dragana Mileusnic, Energy Policy Coordinator for South East Europe at Climate Action Network Europe. “It has to start making a difference for communities severely affected by obsolete and polluting power plants and a weak rule of law.”

Notes for editors:

Read more about the European Community:
https://bankwatch.org/campaign/coal/energy-community

1. The Energy Community brings together Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Moldova, Montenegro, Serbia and Ukraine – and soon also Georgia – with the goal of creating a common energy market between the EU and some of its neighbours. It also aims to extend the EU internal energy policy to south east Europe and the Black Sea region. This includes the obligation for member countries to implement EU environmental law and renewable energy targets.

2. The expert group which was commissioned by the Energy Community to review the institution’s set-up and working methods and to propose directions of reform.

3. CEE Bankwatch Network; Climate Action Network Europe; Health and Environment Alliance; SEE Change Net; EDEN – Environmental Center for Development, Education and Networking (Albania); Ekolevizja (Albania); CPI – Public Interest Advocacy Center (Bosnia and Herzegovina); CZZS – Center for Environment (Bosnia and Herzegovina); DOOR (Croatia); FSO – Forum for Freedom in Education (Croatia); ATRC – Advocacy Training and Resource Center (Kosovo); Front 21/42 (Macedonia); Analytica (Macedonia); Eko-Svest (Macedonia); Green Home (Montenegro); MANS (Montenegro); CEKOR (Serbia); Fractal (Serbia)

For more information contact:

Ioana Ciuta
Energy Coordinator, CEE Bankwatch Network
ioana.ciuta@bankwatch.org
Tel.: +40 724 020 281

Dragana Mileusnic
Energy Policy Coordinator for South East Europe, Climate Action Network Europe
dragana@caneurope.org
Tel.: +32 471 438 442

Masha Durkalić
Communication Officer, SEE Change Net
masha@seechangenet.org
Tel.: +387 33 213 716

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Image: Contracting parties and candidates to the Energy Community. (Original image by Wikimedia user Ssolbergj – available at http://commons.wikimedia.org/wiki/File:Energy_Community.svg)

Dr. Jekyll and Mr. Hyde: An Energy Union torn between clean energy and fossil fuels

Brussels – The vision of Energy Union to be outlined by the European Commission tomorrow proposes making Europe a world leader in renewables and energy efficiency, but at the same time envisages significant investments undermining that goal, such as gas import infrastructure, nuclear and dirty unconventional fossil fuels.

“The latest vision of Energy Union emerging from the Commission has all the right language about a low-carbon and environmentally friendly Europe and empowering European citizens when it comes to their energy consumption,” comments Bankwatch’s Markus Trilling. „But the measures proposed to bring about this vision include more imports of gas from the Caspian region, for instance, or drilling for shale gas. This is non-sense. Europe has to finally face the fact that resilience and sustainability cannot be achieved while at the same time giving in to the gas lobby or cooperating with authoritarian leaders from Central Asia.”

A draft of the Commission proposals for the Energy Union circulated during February, elements of which have been confirmed by Climate and Energy Commissioner Miguel Arias Cañete during the Riga summit, includes mentions of the importance of financing the construction of the Southern Gas Corridor, a system of mega-pipelines meant to bring gas to Europe from the Caspian region. Yet, according to estimates by the Commission itself, under all scenarios, gas demand in Europe will decrease by 2050, raising concerns that the Southern Gas Corridor will turn into just another stranded asset.

The energy mix envisaged by the Commission further includes nuclear power, coal with carbon-capture and storage, liquid natural gas terminals and unconventional fuels.

“While the ‘energy efficiency first’ concept was expounded by Climate Action and Energy Commissioner Cañete in Riga, we see no evidence so far that the EU plans to walk the talk,” adds Trilling. “Instead of focusing on the decarbonisation and the decentralisation of Europe’s energy system, the EU proposes to fast-track for financing fossil fuel projects which have no added value for Europe and will likely end up as stranded assets.”

In a common position similarly leaked to the public during February, Poland, the Czech Republic and Slovakia insisted that the Energy Union must not discriminate among energy sources. Anything from coal through unconventional oil and gas to nuclear should be available to the Member States to reach energy security, climate policy and competitiveness objectives, argued the Central European countries.

“European citizens are no fools to believe that dismissing a clear strategic goal of becoming number one in renewables and sticking to expensive, carbon intensive or obsolete solutions will bring us the competitiveness and independence we are striving for,” comments Bankwatch’s Ondrej Pasek. “Even though the Energy Union does not actually require the central European countries to get rid of coal, gas or nuclear from their energy mixes, if we are to have an effective common energy policy, there is no other way but having a clear focus on technologies that are both low-carbon and competitive: the renewable sources.”

Notes for the editors:

Read more about the Southern Gas Corridor:
https://bankwatch.org/sites/default/files/PipeDreams-LukOil-21Jan2015.pdf

More about the Juncker investment plan:
https://bankwatch.org/news-media/blog/juncker-investment-offensive-against-europeans-economy-and-environment

For more information, contact:

Markus Trilling
Bankwatch EU funds coordinator
Markus.trilling@bankwatch.org
+ 32 484 056 636

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Image credits: Alex Eylar (CC BY-NC-SA 2.0)