WRITTEN QUESTION E-3297/02

by Marie Isler Béguin (Verts/ALE) to the Commission

(21 November 2002)

Subject: Negotiations between the EU and Armenia on the closing of the Medzamor power station

The climate of tension and crisis persisting in the southern Caucasus has highlighted the Republic of Armenia's energy dependence on an outdated power station located in an earthquake zone, which is attracting the attention and concern of the political authorities and scientists throughout the region.

The conclusions of the first EU-Armenia Cooperation Council meeting mentioned the prospect of closing the Medzamor power station.

Discussions with the EU on Armenia's future energy situation began after 1995 when the Armenian government, faced with a severe energy crisis, reactivated the Medzamor power station, with the intention of decommissioning it in 2004. As it has not been possible to work out practical and effective alternatives to replace nuclear power, the EU and Armenia concluded that the closure of the Medzamor power station would require major investment beyond 2004 to allow an alternative solution to be found.

The overall bill for making the Medzamor nuclear hazard completely safe has been estimated at around EUR1 billion, including the investment required for the transition to alternative sources of energy. The EU has pledged EUR100 million, subject to signature of a Memorandum of agreement between the European Commission and the authorities in Erevan ratifying a final closure date; the balance is expected from a Donor Conference scheduled to meet between now the end of this year.

1. Can the Commission reaffirm its commitments regarding the transition in the Armenian energy sector on the same conditions and deadlines as were agreed with the authorities in Erevan?

2. Can the Commission give a transparent and impartial assurance regarding the relevance and objectivity of the studies and financial estimates for the plan to close this power station?

3. Has the Commission put all its energy and resources into promoting renewable energies within this energy substitution programme, taking account of the industrial transition priorities against the background of international environmental crises, in compliance with international commitments on global warming and in line with the major renewable energy source potential available in the Republic of Armenia?

Answer given by Mr Patten on behalf of the Commission

(17 December 2002)

In 1998, the EU-Armenia Joint Committee established a Commission-Armenia Working Group to work on the conditions for closure of the Medzamor Nuclear Power Plant (MNPP).

The Group drew up a strategy designed to provide Armenia with alternative power supplies following the closure of MNPP. This first study showed that closing down MNPP by the target date of 2004 would not be possible without causing serious disruption of electricity supplies to Armenian users.

Against this background, it became clear from the Commission's discussions with the Armenian authorities that it would not be able to obtain an agreement on closure of MNPP by 2004.

A further report funded under the TACIS programme and completed in August 2002 has prepared a detailed Financing and Investment Plan for the development of alternative capacities to MNPP.

The plan prioritises a number of concrete projects which would respectively:

(a) shutdown MNPP and replace its capacity;

(b) increase energy savings, electrical system reliability and fuel diversification and

(c) contribute to meeting electricity demand in 2010, decreasing dependency on non-indigenous sources and increasing diversification.

The Commission is now completing this report by means of a least cost study to establish which sources of energy, including renewable energies, offer the most economically favourable alternative for Medzamor. This is considered an essential step to encourage broad-based financial support from the international community. As soon as this study is completed, we hope early in 2003, the Joint Armenia-Commission Working Group will meet in order to agree on the earliest possible closing date which should be confirmed in a Memorandum of Understanding. The Commission stands ready to honour its commitment to contribute to a donor's fund when this agreement is reached.