WRITTEN QUESTION E-1455/03

by Hiltrud Breyer (Verts/ALE) to the Commission

(29 April 2003)

Subject: Euratom/Type of projects

1. Can the scope of the loan facility be changed to exclude lending to certain designs of reactors, e.g. RBMKs? If not, what is the legal base for such a restriction?

2. Can the scope of the loan facility be changed to allow lending only to nuclear facilities that are operational or awaiting decommissioning? If not, what is the legal base for such a restriction?

3. Can the scope of the loan facility be changed to allow lending only to nuclear facilities outside Member States? If not, what is the legal base for such a restriction?

4. Given that the decommissioning of nuclear facilities does not generate a revenue, how is it anticipated that loans used for decommissioning will be repaid?

5. If approved, will decommissioning be used to undertake stage I and II decommissioning, or is it envisaged that the loans will also be used for the creation of a greenfield site (Stage III)?

6. Fuel and Material Testing Reactors:

(a) Would non-member States be eligible to apply for loans for the construction of new FMTRs?

(b) Will there be any restriction of use placed upon the FMTR e.g. action against use for development of plutonium fuels etc?

(c) What economic analysis will be required to assess the economic viability of these facilities?

7. In the past the Commission has proposed that Euratom loans be used to gain agreements on closure of high risk reactors. Has this conditionality on lending now been dropped?

Answer given by Mr Solbes Mira on behalf of the Commission

(19 June 2003)

1. The Euratom loan facility cannot be used to finance any reactor that is not considered to be safe. The nuclear safety requirements for eligibility of projects do not need to be changed for this purpose. The proposed Guidelines of the Council clearly indicate that at technical level, the Commission will (with the support of experts from the Member States in the case of projects in the eligible non-member countries) examine the extent to which the project provides a solution to the safety problem which exists. [] The Commission's examination will refer to the studies on nuclear safety carried out by the international bodies, International Atomic Energy Agency (IAEA) and World Association of Nuclear Operators (WANO), and under the PHARE and TACIS programmes, and will, with the support of experts from the Member States, assess the project in comparison with measures implemented in the Member States to solve similar types of problem, taking account of the recommendations made by the international bodies.

2. The Commission considers that completion at an acceptable safety level of plants under construction (which otherwise would be finished at a lower safety level) results in a substantial improvement of the nuclear safety and therefore such projects should remain eligible for the Euratom loan facility. The legal basis for the respective Council Decision is the Euratom Treaty.

3. The Commission considers that, given the importance of ensuring an adequate nuclear safety level within the Union, and the substantial financial burden that may be necessary for certain candidate countries to achieve that objective, their access to the Euratom loan facility should continue under the same conditions they have today once they become Member States. In order to ensure that, in practice, the funds are used to grant loans for safety and efficiency purposes, the Commission inserted in its proposal a recital and a paragraph in the Guidelines stating that priority shall be given to projects related to safety and efficiency of installations.

4. Decommissioning projects are not generating revenues by themselves but they should be financed during the whole life of the plant by accumulating provisions as recently proposed by the Commission in its proposal for a Council Directive setting out basic obligations and general principles on the safety of nuclear installations. However, for future Member States and other non-Member States such provisions do not exist or have not been in place long enough to reach the necessary level. In this case, the decommissioning projects would be examined on a case by case basis to evaluate their economic conditions.

5. Euratom loans could be used for projects at any stage of decommissioning.

6. (a) Council Decision 94/179/Euratom(1) does not allow involvement in the construction of new nuclear power plants in non-Member States.

(b) Projects concerning new installations of this kind shall, pursuant to Chapter IV of the Euratom Treaty relating to investment, be communicated to the Commission, which shall discuss with the persons or undertakings all aspects related to the objectives of the Treaty. All nuclear facilities in the Union are subject to Euratom nuclear material safeguards as laid down in chapter VII of the Euratom Treaty. The operator has to declare the basic technical characteristics of the installation and has to maintain a nuclear materials accountancy system. Whereas there are no direct restrictions regarding the use of the facility, the Commission has to satisfy itself that the nuclear materials are not diverted from their intended uses and that there is compliance with the provisions relating to supply and any other safeguarding obligations assumed by the Community under an agreement concluded with a third State or an international organisation.

(c) The economic analysis would be based on the communication to the Commission referred to in 6(b) above.

7. It is not a requirement of the Euratom loan facility that there be closure conditions attached. However, as it is a financial tool to support the Community policy on nuclear matters, and so as to be coherent, the Commission has included such conditions in the Euratom loan contracts where a previous agreement had been reached. This is the case for Bulgaria (closure agreements for Kozloduy units 1 to 4 reached in the framework of the Union enlargement exercise are reflected in the Euratom Loan Agreements for units 5 & 6), and for Ukraine (closure of Chernobyl as agreed in the 1994 G7/EC/Ukraine Memorandum of Understanding is included in the draft Euratom Loan Agreements for K2R4). Where possible, when the Commission reaches a closure agreement, it would be included in any related Euratom loan. This then becomes a powerful enforcement instrument.

(1) Council Decision 94/179/Euratom of 21 March 1994 amending Decision 77/270/Euratom, to authorise the Commission to contract Euratom borrowings in order to contribute to the financing required for improving the degree of safety and efficiency of nuclear power stations in certain non-member countries, OJ L 84, 29.3.1994.