COMMISSION STAFF WORKING DOCUMENT EX-ANTE EVALUATION Accompanying the document Proposal for a Council Decision amending Decision 2007/198/Euratom establishing the European Joint Undertaking for ITER and the Development of Fusion Energy and conferring advantages upon it
Date: 2018-06-07
Institutions: Directorate-General for Energy, European Commission
Subjects: EAEC, EU financing, European Joint Undertaking, nuclear fusion, nuclear reactor, nuclear research

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 7.6.2018  SWD(2018) 325 final  COMMISSION STAFF WORKING DOCUMENT EX-ANTE EVALUATION  Accompanying the document Proposal for a Council Decision amending Decision 2007/198/Euratom establishing the European Joint Undertaking for ITER and the Development of Fusion Energy and conferring advantages upon it  {COM(2018) 445 final} - {SWD(2018) 326 final}  
 
 
Table of contents 

1. 

PROBLEM ANALYSIS AND NEEDS ASSESSMENT ...................................................................... 3 

1.1.  Scope and context of ITER ............................................................................... 3 
1.2.  Lessons learned from evaluations of previous programmes ............................. 8 
1.3.  Motivation and interests of the key actors....................................................... 10 

2. 

EU ADDED VALUE .......................................................................................................................... 11 

2.1.  EU added value ............................................................................................... 11 
2.2.   Coherence and synergies with other policy areas ........................................... 11 

3. 

POLICY AND MANAGEMENT OBJECTIVES ............................................................................... 12 

3.1.  Challenges of the programme in the next MFF ............................................... 12 
3.2.  Objectives of the programme in the next MFF ............................................... 13 

4. 

POLICY OPTIONS, INCLUDING ASSOCIATED RISKS ............................................................... 14 

4.1.  Options for delivery mechanisms .................................................................... 14 
4.2.  The preferred approach, including risk identification and mitigation ............. 16 
4.3.   Proposed legal basis ........................................................................................ 17 

5.   RESULTS AND IMPACTS ................................................................................................................ 17 

5.1.   Programme structure ....................................................................................... 17 
5.2.   Programme priorities ....................................................................................... 17 
5.3.   Critical mass of funding .................................................................................. 18 
5.4.   The necessary volume of resources ................................................................. 19 
5.5.   Economic, social, and environmental impacts ................................................ 19 

6.   MONITORING AND EVALUATION ............................................................................................... 20 

6.1.   Performance monitoring in ITER Organization .............................................. 20 
6.2.   EU participation in the ITER project's governance and supervision .............. 21 
6.3.   Commission's oversight of Fusion for Energy ................................................ 21 
6.4   KPIs and milestones for next MFF ................................................................. 22 

ANNEX 1: EVALUATION RESULTS ....................................................................................................... 23 

ANNEX 2: STAKEHOLDER CONSULTATIONS ..................................................................................... 27 

ANNEX 2A: INDUSTRY TESTIMONIALS ............................................................................................... 29 

ANNEX 3: VOLUME OF APPROPRIATIONS .......................................................................................... 31 

1 

 
 
 
 
 
 
Glossary 

Term or acronym 

Meaning or definition 

BA 

DA 

DEMO 

DG 

ESA 

EU 

F4E 

GB 

GNI 

GVA 

IC 

Broader Approach 

Domestic Agency 

Demonstration reactor 

Director General 

European Space Agency 

European Union 

Joint Undertaking “Fusion for Energy” 

Governing Board 

Gross National Income 

Gross Value Added 

ITER Council 

IFMIF/DONES 

International Fusion Materials Irradiation Facility - 
DEMO Oriented Neutron Source 

ITER Council Review Group 

ITER Organization 

Joint Undertaking 

Key performance indicator 

Multiannual financial framework 

Research and Development 

Small and medium enterprises 

Treaty on the Functioning of the European Union 

ICRG 

IO 

JU 

KPI 

MFF 

R&D 

SMEs 

TFEU 

2 

 
 
 
 
 
 
1.  PROBLEM ANALYSIS AND NEEDS ASSESSMENT 

This  staff  working  document  has  been  drafted  to  satisfy  the  requirements  of  the  Financial 
Regulation  with  respect  to  ex  ante  evaluation  of  proposals  for  activities  requiring  budget 
expenditure and concerns the future funding of Europe’s participation in the ITER project and 
the  associated  activities  ensured  by  F4E  (notably  Broader  Approach  (BA)  activities  and 
preparation of DEMO) under the post-2020 Multi-Annual Financial Framework (MFF).  

This  ex  ante  evaluation  aims  to  support  the  activities  dictated  by  the  new  ITER  project's 
baseline  and  the  need  to  complete  the  construction  of  ITER  following  the  project's  recent 
turnaround. 

1.1. Scope and context of ITER 

1.1.1. Context 

ITER is an international scientific collaboration project between seven global partners (ITER 
Parties  -  EU,  United  States,  Russia,  Japan,  China,  South  Korea,  and  India).  The  project, 
implemented  on  the  basis  of  the  ITER  Agreement1  aims  at  demonstrating  the  scientific  and 
technological feasibility of fusion energy for peaceful purposes, an essential feature of which 
would be achieving sustained fusion power generation (Article 2 of the ITER Agreement). No 
single country has the capacity to develop a project the size of ITER, whose scale is necessary 
for the expected breakthrough on the way to mastering fusion as an energy source2.  

Whilst  the  level  of  ambition  and  effort  required  to  build  ITER  calls  for  wide  international 
cooperation, Europe is in the driving seat as the host of this project and its biggest contributor. 
Under  the  ITER  Agreement,  the  stake  of  the  other  six  international  partners  in  ITER 
construction  is  around  9%  each,  and  Europe  bears  the  remaining  45%  of  the  construction 
costs.  After  the  construction  of  ITER,  Europe  will  cover  34%  of  the  cost  of  operation, 
deactivation and decommissioning of ITER. 

In this context, neither ITER nor the European participation therein can be fully regarded as a 
programme  in  the  usual  sense  of  Commission  programmes.  European  activities  in  ITER 
represent a contribution to an internationally agreed collaborative effort to which Europe has 
committed  itself  (through  the  ITER  Agreement)  for  at  least  35  years  starting  in  2007,  i.e. 
across  multiple  MFF  periods.  This  is  a  fundamental  difference  relative  to  normal  EU 
programmes,  which  are  usually  established  for  a  single  MFF  (even  if  repeatedly)  and  for 
which  a  decision  on  the  scope  of  the  action,  its  launch  and  its  duration  are  within  the  EU's 
sole discretion. 

While  the  legal  commitments  under  the  ITER  Agreement  bind  the  EU,  the  participation  in 
ITER should not be seen as a mere obligation but also as a unique opportunity for the EU to 
benefit - both from ITER's future results and from the present business opportunities it creates 
for  European  suppliers.  These,  in  turn,  entail  not  only  the  usual  impacts  in  terms  of  job 
creation  and  direct  economic  stimulus  but  also  deliver  important  spin-off  effects  and 
synergies. 

1 ITER Agreement, 25th April 2007 
2 Fusion is projected to play an important role in Europe's future energy landscape as a climate friendly energy source, since 
it does not produce greenhouse gases and the fuel used is widely available. The investment in ITER aims to support enabling 
practical exploitation of fusion as an energy source in the future and thus contributes to the significant energy transformation 
in Europe set out in the Energy Union strategy. 

3 

 
 
                                                            
The contribution of each ITER Member is provided both in cash, through contributions to the 
budget  of  the  ITER  Organization  (IO)  for  its  functioning,  and  (mostly  –  ca.  90%)  in  kind 
through the delivery of components of the ITER machine and facility. The ITER Agreement 
foresees that each Member shall provide its contribution to the ITER Organization through a 
Domestic Agency (DA).  

For  Europe,  the  Domestic  Agency  is  the  Joint  Undertaking  "Fusion  for  Energy"  (F4E)  that 
was set up by a Council Decision (Council Decision 2007/198/Euratom3 – also referred to as 
F4E's  Statutes)  on  27  March  2007  for  a  period  of  35  years  and  has  its  headquarters  in 
Barcelona,  Spain.  F4E  discharges  the  obligations  of  EU  to  the  ITER  Organization,  both  in-
cash  and  in-kind.  Furthermore,  F4E  coordinates  EU  participation  in  collaborative  fusion 
activities with Japan under the Broader Approach4 and carries out preparations for DEMO. 

The  European  Commission  (DG  ENER)  represents  EU  in  the  governance  structures  of  the 
ITER Organization (ITER Council and subsidiary bodies) and in the governance of F4E5 (F4E 
Governing Board and subsidiary bodies). 

The budget of F4E is composed of contributions from the EU budget, France as Host State, 
and  from  the  Members  of  Fusion  for  Energy.  The  European  contribution  to  ITER's 
construction (provided through Fusion for Energy's budget) is funded 80% by the EU budget 
and  20%  by  France.  In  addition,  the  EU  budget  provides  the  contribution  to  F4E  for  its 
running  cost  and  the  other  operational  activities  (Broader  Approach6  and  DEMO).    The 
overall  budget  of  Fusion  for  Energy  also  benefits  from  an  additional  less  than  1%  paid 
directly by the F4E Members.  

The  20%  French  contribution  for  the  construction  costs  of  ITER  was  established  by  an 
exchange  of  letters  between  France  and  the  Commission  in  2006  and  reflected  in  the  terms 
under  which  F4E  was  set  up  by  the  Council  Decision  in  2007  (the  financial  statement 
accompanying  the  Commission  proposal  for  the  Council  Decision).  As  stated  in  the 
Commission  Communication  of  June  2017  on  "the  EU  Contribution  to  a  reformed  ITER 
Project", the continuation of France's contribution to the operation costs is assumed also for 
the operation phase when Europe's share in ITER costs shifts from the current 45% to 34%. 

The  intervention  logic  of  the  European  contribution  to  ITER  is  presented  in  the  following 
diagram.  

3 Amended by: Council Decision 2013/791/Euratom of 13 December 2013 and Council Decision (Euratom) 2015/224 of 10 
February 2015. 

4In order to secure the siting of the ITER project in Europe, the EU concluded a bilateral agreement with Japan – the Broader 
Approach  Agreement  (BA)  -  on  collaboration  in  specific  corollary  fusion  projects  and  experiments  located  in  Japan.  As 
result, three projects are currently under development in Japan, with European participation coordinated by Fusion for Energy 
and  provided  by  several  EU  Member  States  as  Voluntary  Contributors:  the  construction  of  a  satellite  tokamak  facility 
(JT60SA),  the  engineering  design  of  a  future  material  irradiation  facility  (IFMIF-EVEDA),  and  a  supercomputer  for 
modelling plasma behaviour (IFERC). 

5 F4E's Governing Board (GB) comprises the 28 EU Member  States and Switzerland, in addition to the Commission. The 
Commission's vote in the F4E GB, has the same weight as that of France, Germany, Italy and the UK - 5 votes of a total of 
72, whilst it has no veto right. The Commission has the right to make a reservation to a decision by the GB when it considers 
that the decision may be contrary to EU law ("reservation on legality") 

6 According to the Broader Approach (BA) agreement, EU and Japan would each make contributions of EUR 339 million to 
joint BA activities. The European contribution is mainly provided as in-kind contributions by several Members of F4E acting 
as Voluntary Contributors (Belgium, France, Germany, Italy, and Spain). In addition, F4E contributes to BA activities and 
ensures the coordination of European participation, with costs of approximately EUR 60 million covered from the funding 
provided to F4E by Community budget. 

4 

 
 
                                                            
5 

 
 
 
1.1.2. Scope and developments under the current and previous MFFs 
The  Commission  Communication  "The  EU  Contribution  to  a  Reformed  ITER  Project" 
and its accompanying Staff Working Document7 present in detail the problems faced by 
ITER  at  its  initial  phase,  the  need  for  a  new  baseline  in  2010  and  the  capping  by  the 
Council of the budget up to 2020 at EUR 6.6 billion (2008 value). They also present the 
actions  taken  in  2015  and  2016  to  turnaround  the  project  including  changes  in  the 
management  of  both  the  ITER  organization  and  F4E,  and  the  update  in  2016  of  the 
project baseline. The Commission was largely the initiator and agent of these efforts.  

In the current MFF, the EU contribution to F4E is funded through its own budget lines 
under the heading 1a "Smart  and inclusive growth" and the total funding for the 2014-
2020 period was set at EUR 2.9 billion (in current value)8. 

The  annual  evolution  of  payment  appropriations  till  the  end  of  the  current  MFF  is 
presented in the diagram below (EUR million in current value). As is demonstrated in the 
graph,  in  recent  years,  the  payments  have  accelerated  substantially.  The  evolution  of 
commitments in the current MFF is also very positive, within the cap of EUR 6.6 billion 
till 2020 which will be respected. 

While  the  project  has  undergone  a  major  restructuring,  important  progress  has  been 
achieved: 

  All  milestones  set  up  by  the  ITER  Council  in  2016  to  monitor  the  project 
construction under the new baseline and due by December 2017 have been achieved. 
  The  project  is  as  of  end-2017  half-way  to  First  Plasma:  the  project  reached  the 
completion  of  50  percent  of  the  total  physical  work  (design,  manufacturing 
construction, assembly, and installation) for First Plasma. 

  A positive project management trend has been recognised by independent experts.  

7 COM(2017)319 final and SWD(2017)232 final 
8  As  defined  in  Council  Decision  of  13th  December  2013  amending  Decision  2007/198/Euratom  establishing  the 
European  Joint  Undertaking  for  ITER  and  the  Development  of  Fusion  Energy  and  conferring  advantages  upon  it 
(2013/791/Euratom) 

6 

 
 
 
 
                                                            
  The results of the first in-depth reviews of critical project areas (risk management and 
interfaces of components) have given confidence that the project is on the right track. 

The  new  schedule  currently  follows  a  staged  approach  which  focuses  first  on  the 
construction of the components which are essential to achieving First Plasma, followed 
by  successive  series  of  installation  and  testing  phases  before  starting  full  performance. 
The impact of the staged approach is presented in the diagram below. 

1.1.3. Scope of ITER under the next MFF  

The execution of the new baseline and its impact on F4E and the European participation 
in the project are presented in the Commission Communication "The EU Contribution to 
a Reformed ITER Project" and its accompanying Staff Working Document. 

If adequate funds are not ensured so as to allow the EU's participation in the project in 
accordance  with  its  commitments,  the  EU  will  be  in  breach  of  its  international 
obligations  undertaken  by  the  signature  of  the  ITER  Agreement.  Furthermore,  not 
providing adequate funding for EU participation would increase the risk of further delays 
and associated cost increases. This entails further risks of losing international partners in 
a major project where Europe has the lead and stands to gain from hosting its operations, 
while it cannot - under the terms of the ITER Agreement - itself step out of the project, 
and  would  thus  have  to  absorb  the  consequences  of  other  Parties  departing  and/or  not 
contributing.  

The role of fusion and the role of ITER in  its development are well recognized  from a 
scientific point of view, by both the European and the global scientific community and 
are  recognized,  from  a  political  perspective,  by  the  European  decision-makers.  Besides 
the  lead  in  the  ITER  project,  European  efforts  in  developing  fusion  technologies  also 
entail  support  of  research  and  development  activities  under  the  Euratom  research  and 
training  programme.  The  funding  for  fusion  research  and  ITER  are  complementary  to 
each  other  but  separate  in  terms  of  objectives,  implementation  and  governance.  They 
both  jointly  contribute  to  the  long-term  objective  of  developing  fusion  as  an  energy 
source in accordance with the European Fusion Roadmap9. 

9  

https://www.euro-fusion.org/eurofusion/roadmap/ 

7 

Slide 35/35Outcomes from Configuration Workshop and Research Plan Workshop, EPB16-31, 22 Sep 2016Reference (4-stages)First Plasma (FP)Dec. 2025Outline Research Plan Structure (Reference vs. Proposed 3-stages Model)[Staged Approach Durations: Reference Model -120 M (10 Years) from FP to DT]EO Finished and Start of Assembly II Jun. 2026End of Assembly IIJun. 2028Start of Pre-Fusion Power Operation-I  (SP)Dec. 2028End of Pre-Fusion Power Operation-I and Start of Assembly IIIJun. 2030End of Assembly IIISep. 2031Pre-Fusion Power Operation-II (TP)Jun. 2032End of Pre-Fusion Power Operation-II  and Start of Pre-Nuclear Shutdown for Assembly IVMar. 2034End of Pre-Nuclear Shutdown for Assembly IVMar. 2035Fusion Power Operation(DT)Dec. 2035Engineering Operation (SC Magnets)(6 Months)Assembly II(24 Months)Integrated Comm. II (6 Months)Pre-Fusion Power Operation-I (18 Months)Pre-Fusion Power Operation-II (21 Months)Assembly IV (12 Months)Integrated Comm. IV (9 Months)Integrated Comm. III (9 Months)Assembly III (15 Months)First Plasma (FP)Dec. 2025Pre-Fusion Power Operation-I Dec. 2028Pre-Fusion Power Operation-IIJun. 2032Fusion Power OperationDec. 2035Engineering Operation (SC Magnets)(6 Months)Assembly / Installation II(30 Months)Pre-Fusion Power Operation (Total 42 Months Operationw/ 3 Months Shutdown)Assembly III (12 Months)Integrated Comm. IV (9 Months)Integrated Comm. II (11 Months)First Plasma (FP)Dec. 2025Fusion Power OperationJan. 2035Jan. 2029Pre-Fusion Power OperationJan. 2030Possible “3-stages” ModelMar. 2033Mar. 2034 
 
 
 
 
                                                            
Continued participation in the ITER project is in line with the Commission's  vision for 
the  next  MFF  (2021-2027),  highlighting  a  growing  call  to  support  the  shift  to  a  low-
carbon economy.  

In  the  follow-up  to  the  publication  of  the  Commission  Communication,  the  inter-
institutional  discussions  with  the  Council  of  Ministers  and  the  European  Parliament  on 
the  new  ITER  baseline  reveal  that  the  Council  and  the  European  Parliament  see  the 
revision  of  the  baseline  together  with  the  management  changes  as  significant  ways  to 
ensure the necessary turnaround of the project’s past pace. The Council of the EU and the 
European Parliament recognize that the new ITER baseline is a solid basis for further EU 
engagement in ITER. 

On 12 April, the Council of the European Union mandated the Commission to approve 
the new ITER baseline on behalf of Euratom at an ITER Council meeting at Ministerial 
level. Europe’s political support to the new baseline will provide needed stability and re-
assurance  to  the  project  and  the  companies  and  research  centres  involved,  allowing 
current  contracts  to  be  completed  and  necessary  new  ones  to  be  launched.  It  will  also 
allow for continued participation of the EU in ITER and the continuation of cooperation 
with  ITER  Members  and  their  domestic  agencies  under  the  terms  of  the  ITER 
Agreement. 

The  European  Parliament  (EP)  decides  on  the  discharge  to  F4E  for  every  financial 
year.  The  latest  discharge  decision10  by  the  EP  was  granted  in  April  2018  for  the 
financial  year  2016.  With  this  decision,  the  EP  reconfirmed  its  support  to  the  ITER 
project  and  recognised  the  significant  improvements  and  efforts  undertaken  by  F4E  in 
collaboration with the European Commission, the ITER IO and the other ITER domestic 
agencies.  With  this  positive  discharge  decision  and  associated  resolution,  the  EP 
reconfirms its support and renewed confidence in the ITER project and F4E. 

The Parliament's Budgetary Committee has in its own-initiative report on the next MFF 
included ITER amongst expenditures, which the EU budget should continue to fund. 

1.2.  Lessons learned from evaluations of previous programmes 

1.2.1. Key findings and lessons learned from evaluations  

Both the ITER Organization and F4E were recently subject to various evaluations either 
assessing operational capacity/performance in general (e.g. ITER Organization bi-annual 
management  assessments  and  F4E  annual  assessments)  or  targeting  specific  key  topics 
(e.g.  risk  management  review,  freezing  of  interfaces  review).  Detailed  information  on 
these  evaluations 
these 
reviews/evaluations can be summarized as follows: 

in  Annex  1.  The 

learned  from 

is  provided 

lessons 

  The technical complexity of a unique project where many components are first-of-a-
kind have led, in its initial stages, to a significant underestimation of the time needed 
for the completion of the construction and of the associated cost for both  the ITER 
Organization and the Domestic Agency responsible for ensuring the procurement and 
delivery of the in-kind contributions.  

10 European Parliament decision of 18 April 2018 on discharge in respect of the implementation of the budget of the 
European  Joint  Undertaking  for  ITER  and  the  Development  of  Fusion  Energy  for  the  financial  year  2016 
(2017/2180(DEC)) 

8 

 
 
                                                            
  Procurement  decisions  were  in  earlier  stages  taken  forward  despite  immature  and 
incomplete  design  which  precluded  a  sufficiently  robust  procurement  and 
construction  process,  leading  to  frequent  modifications  of  contracts  or  their 
amendments during execution; this led to further cost increases and delays. 

  Significant  changes  and  improvements  have  taken  place  both  in  the  ITER 
Organization  and  in  Fusion  for  Energy  since  2015,  accomplishing  a  very  profound 
turnaround in both organizations. They addressed inter alia the process organization 
and project management in both IO and F4E, which had until 2015 shown important 
weaknesses,  in  particular  low  project  management  focus  on  cost  and  schedule  and 
limited industrial expertise.  

  Changes by ITER Parties and particularly Europe have since 2015 brought changes to 
the governance structures and processes which at the earlier stages of the project did 
not provide for effective oversight of the ITER Organization and Fusion for Energy 
nor  appropriate  coordination  and  collaboration  between  the Domestic  Agencies  and 
the ITER Organization. 

  The changes in the management and governance of the project have been reflected in 
the new baseline of the project elaborated in 2015 and approved by the ITER Council 
ad referendum in 2016, following reviews by independent experts.  

  To  ensure  schedule  reliability,  a  reasonable  contingency  should  be  considered.  As 
stated in the Commission Communication on ITER, in line with existing experience 
with large international projects of similar complexity and maturity, the Commission 
estimates that a contingency of up to 24 months in terms of schedule and 10-20% in 
terms of budget appears appropriate. 

1.2.2. New ITER baseline – key strengths 

A positive appreciation of ITER's progress in the last three years and of its turnaround by 
the new management have been confirmed by the ITER Council Review Group and by 
the 2015 and 2017 Management Assessments of the ITER Organization, as well as by the 
US Department of Energy report on "US participation in the ITER project".  

A  high-level  assessment  confirmed  the  capacity  of  F4E  to  deliver  the  European 
contribution to the new ITER schedule on time  and coherent with the staged approach. 
The  positive  progress  made  in  the  management  of  the  project,  as  expressed  also  in 
several  independent  reviews,  provides  confidence  that  the  ITER  Organization  and  F4E 
(and also the other Domestic Agencies) are working together towards the success of the 
project and are better armed to manage any future project challenges.  

Compared to the previous period of the project, the new baseline's credibility and realism 
is driven by the following elements: 

  “Staged approach” to the project construction, reflected in the new schedule which 
aims to achieve First Plasma in December 2025 (earliest technically achievable date), 
followed by successive series of installation and testing phases before starting the full 
performance phase (Deuterium-Tritium operations) in 2035.  

  High  design  maturity/stability,  with  most  procurement  arrangements  decided  and 
contracted  and  designs  of  components  and  the  definition  of  their  interfaces 
progressively completed and frozen.  

9 

 
 
 
  New  management  in  IO  and  in  F4E,  with  industrial  expertise  from  implementing 
large  project  and  with  experience  in  nuclear  safety  matters  and  construction  and 
operation of fusion installations. 

  Closer  integration  of  IO  and  Domestic  Agencies,  with  Integrated  Project  Teams 
(IPTs)  for  items  on  the  critical  path,  and  a  schedule  formulated  through  iterations 
between the IO and DAs. 

  A realistic schedule respecting the budgetary and technical limitations of the Parties 

and their Domestic Agencies. 

  Creation  of  a  Reserve  Fund  which  introduces  a  tool  to  compensate  ITER  Members 
for  cost  overruns  due  to  design  changes  and  creates  an  incentive  for  the  ITER 
Organization  to  minimize  changes  as  much  as  possible.  This  is  because  it  has  to 
reimburse  the  DAs  whenever  changes  are  triggered  by  IO;  the  Reserve  Fund 
therefore acts as a risk mitigation tool. 

As confirmed at the ITER Council meetings since the elaboration of the new baseline in 
early 2016, works at the ITER site are now progressing well within the baseline and the 
project remains on schedule for First Plasma as per the new baseline schedule.  Equally, 
the  meetings  of  the  Governing  Boards  of  F4E  in  2016  and  2017  have  received  regular 
reports from F4E senior management showing the compliance with the EUR 6.6 bn cap 
for  2020  as  well  as  F4E's  cost  and  schedule  projections  prepared  in  mid-2016  on  the 
basis of the new ITER baseline.  

1.3.  Motivation and interests of the key actors 

While the project did not progress from the start of the current MFF in accordance with 
the 2010 baseline and has increasingly accumulated delays and cost overruns, it has been 
nevertheless  producing  benefits  for  European  industry  and  economy  as  evidenced  in 
evaluations,  data  on  F4E  activities  and  stakeholder  consultations.  Furthermore,  ITER 
offers  European  industries  a  valuable  opportunity  to  innovate  and  develop  products  for 
exploitation in areas outside fusion.  

This  has  also  been  recognized  in  recent  evaluations  and  stakeholder  feedback. 
Stakeholders  have  been  consulted  in  multiple  ways,  ensuring  the  collection  of  a 
representative set of information regarding ITER project implementation and impacts. 

The MFF open public consultation is accompanied by a number of targeted stakeholders’ 
consultation activities.  

In  the  context  of  the  recent  “Value  for  Money”  study  around  80  contractors  across 
sectors  and  geographies  highlighted  the  important  benefits  brought  to  the  European 
industry and research community. The expectations of the industry are in line with those 
of  the  research  community  and  national  administrations  as  discussed  in  the  Governing 
Board of F4E and the General Assembly of Eurofusion.  

In addition, an industry event was organised by the European Commission in December 
2017  providing  an  opportunity  to  collect  feedback  from  senior  company  executives, 
policy makers, and energy experts from Europe and the rest of the world.  

The various consultation activities are presented in more detail in Annexes 2 and 2a. 

10 

 
 
 
2.  EU ADDED VALUE 

2.1.  EU added value 

The initiative falls under the exclusive competence of the EU according to Article 101 of 
the Euratom Treaty. Therefore, the subsidiarity principle does not apply. 

ITER is a unique, first-of-a-kind, long-term project which greatly contributes to the long-
term  EU  strategy  for  clean  energy,  security  of  supply  and  competitiveness.  As  such,  it 
cannot  be  executed  through  industry  initiative  at  this  stage  of  the  technology 
development and public intervention is warranted. This investment offers European high-
tech  industries  and  small  and  medium  enterprises  (SMEs)  a  valuable  opportunity  to 
innovate  and  develop  “spin  off”  products  for  exploitation  outside  fusion  (such  as  the 
broader energy sector, aviation, medical, and hi-tech instruments).  

As ITER's legal basis is an international agreement to which Euratom is a Party, action at 
EU  level  is  more  effective  (less  fragmentation)  and  efficient  (better  value  for 
money/economies  of  scale),  and  offers  coordination  of  actions  (e.g.  in  addressing 
externalities)  for  meeting  EU  obligations.  Pooling  of  resources  and  expertise  is 
paramount to the construction of ITER and EU action is particularly needed to achieve 
the  critical  mass  of  resources  and  knowledge  across  different  fields,  technologies,  and 
research infrastructures and industries required for the construction of this first-of-a-kind 
project. This has also been recognized explicitly in the “Reflection Paper on the Future of 
EU  Finances”  of  June  2017,  which  puts  forward  clear  value  added  when  action  at 
European level goes further than national efforts could  –this includes "big projects and 
key  enabling  technologies,  such  as  […]  ITER  (which)  can  only  be  financed  by  pooling 
resources at EU level because of their very high financing needs". 

Accordingly,  action  at  EU  level  delivers  results  that  uncoordinated  national  spending 
could not achieve in terms of a number of strategic priorities: i.) security of supply; ii.) 
opportunities  for  long-term  growth  and  development  of  European  science,  technology 
and  industry,  and  structuring  of  the  EU  R&D  fabric;  iii.)  improvements  in  quality  and 
innovation through exposure to EU-wide and global competition, and iv.) mobilizing the 
EU potential/negotiating power at global level. 

Continued EU added value: the EU is the Host Party of the ITER project, which entails 
specific  responsibilities;  in  particular,  pursuant  to  Article  26.1  of  the  ITER  Agreement, 
the Host Party cannot withdraw from the project11. 

2.2.   Coherence and synergies with other policy areas 

The  ITER  project  ensures  synergies  with  the  following  policy  areas:  i.)  research;  ii.) 
industrial policy; iii.) climate change; and iv.) the EU as a global player. 

ITER is part of the overall Fusion Roadmap developed by the European scientific fusion 
community  and  is  aligned  with  the  research  efforts  in  developing  fusion  technologies 

11 An ITER Member other than EU can withdraw after 10 years from the entry into force of the Agreement, but with 
the obligation to continue providing its contribution for the construction phase and with no possibility of participating 
in the experimental phase. 

11 

 
 
                                                            
funded under the Euratom Research and Training Programme 2014-201812. Participation 
in ITER is thus fully complementary and coordinated with these activities. 

The successful construction and operation of ITER is on the critical path of the European 
fusion  roadmap,  which  represents  a  comprehensive  goal-oriented  path  to  fusion 
electricity  endorsed  by  all  fusion  research  stakeholders  in  Europe.  The  new  baseline 
contains  a  realistic  schedule  to  achieve  the  goal  of  ITER  and  is  essential  input  to  the 
roadmap.  

ITER  is  complemented  by  activities  carried  out  together  with  Japan  under  the  Broader 
Approach  Agreement  and  the  Test  Blanket  Module  programme,  as  well  as  the 
International  Fusion  Materials  Irradiation  Facility  (IFMIF/DONES).  ITER  will  be 
followed by a  demonstration reactor  (provisionally called DEMO),  which will  build on 
the  experimental  achievements  of  ITER  with  the  aim  to  demonstrate  the  economic 
feasibility of commercial exploitation of fusion power. 

Furthermore,  ITER  offers  European  high-tech  companies  a  unique  opportunity  to 
innovate and develop “spin off”' products. 

3.  POLICY AND MANAGEMENT OBJECTIVES 

3.1.  Challenges of the programme in the next MFF  

3.1.1. Key challenges 

While the actual cumulative EU spending by 2020 will be close to the 6.6 billion limit 
established in 2010 for the construction period, the construction will not be finalized by 
then.  Stemming  from  the  findings  and  lessons  learned  from  the  evaluation  activities 
detailed in section 1.2 above, the challenge will be to make the new baseline deliver its 
full  potential  and  fund  it  accordingly,  as  a  radical  overhaul  of  the  project  has  been 
successfully implemented to prevent future deviations from project planning, and as the 
EU, as Host Party of the ITER project, cannot withdraw from the project. 

Accordingly, the key challenges for the next MFF will therefore be to:  

recent 

through 

i.)  Sustain  the  positive  momentum  in  the  project's  performance  and  management 
achieved 
and 
supervision/monitoring;  
ii.)  Ensure  finalisation  of  the  construction  and  assembly13  enabling  the  achievement  of 
First Plasma in December 2025 (the earliest technically achievable date) and subsequent 
complementary construction and advancement of the post-First Plasma components; and   

in  management, 

improvements 

governance 

iii.) Retain the commitment of all ITER Parties to meeting in full their obligations thus 
enabling the timely and cost-efficient completion of the project.  

Meeting these challenges will require sustained EU leadership in the project which needs 
to be underpinned by excellent performance of F4E and full compliance of the EU with 

12  Proposal  for  the  Euratom  Research  and  Training  Programme  2019-2020  is  under  discussion  in  the  Council  (see 
COM(2017)698) 
13  The  maturity  of  the  design  gives  increased  reliability  to  the  new  schedule  and  associated  resources  estimates:  the 
final  design  for  components  needed  for  First  Plasma  has  reached  89%,  while  that  for  non-First  Plasma  components 
stands at 71%. 

12 

 
 
                                                            
its  share  of  funding  obligations  and  in-kind  contributions  (i.e.  components  under 
European responsibility, procured and delivered by F4E). 

3.1.2. New political priorities or emerging problems needing EU intervention. 

Brexit  does  not  change  the  overall  legal  commitment  of  the  EU  to  ITER,  which  is 
governed by the international ITER Agreement to which the EU - and not individual EU 
Member  States,  is  the  contracting  party.  Brexit  will  not  change  the  EU's  financial  
obligations  towards  ITER  which  have  been  undertaken  by  the  EU  as  a  whole,  by  the 
conclusion of the ITER Agreement.  

It  should  be  underlined  that  the  UK  took  commitments,  as  EU  Member  State,  towards 
ITER when approving the different project baselines in the Council of the EU. It should 
also  be  noted  that  the  UK  has  expressed  its  interest  in  continued  involvement  in  ITER 
activities.  

3.2.  Objectives of the programme in the next MFF 

In accordance with the key challenges for the next MFF as identified in section 3.1.1, the 
general objective of the ITER-related EU action in the next MFF is to fully support the 
continuation of ITER construction and to reach the operation of ITER with First Plasma 
by 2025, to be followed by first experimental operations as well as further installations 
and upgrades until 2027 and beyond, laying grounds for successful full power operation 
(so called Deuterium-Tritium stage) by 2035.  

These achievements are considered as a necessary step in the development of fusion in 
order for it to become a possible source of sustainable energy fostering the job, growth 
and  innovation  potential  of  the  energy  sector  in  the  later  part  of  the  century,  in 
accordance with the European Fusion Roadmap.  

To achieve this general objective, five specific objectives for the next MFF will be as 
follows:  

i.) provide sufficient performance-based funding to IO for its operations, particularly the 
assembly  of  the  installation  from  the  components  arriving  from  individual  ITER 
members;  

ii.)  ensure  delivery  of  EU  components  by  F4E  in  line  with  the  project  schedule,  in 
particular  its  construction  and  assembly  strategies,  and  in  close  adherence  with 
performance monitoring; 

iii.) offer European high-tech industries and SMEs a valuable opportunity to innovate and 
develop  “spin  off”  products  for  exploitation  outside  fusion,  thereby  further  reinforcing 
the EU added value of the ITER project activities;  

iv.) secure continued EU leadership in the ITER project by ensuring timely delivery of 
EU components and active participation in ITER governance processes; and  

v) continue activities with Japan (BA) on the operation of the satellite tokamak JT60SA 
and on the development of a full scale material testing facility (IFMIF/DONES) to ensure 
that  together  with  ITER's  results,  all  technical  and  scientific  elements  needed  for  the 
design of a fusion-based power generation device for demonstration are in place, thereby 
anchoring  the  synergetic  contribution  of  ITER  to  the  coherence  of  fusion  development 
and fostering the common benefits of fusion research under the Fusion Roadmap.  

13 

 
 
In achieving the above-mentioned objectives care will be taken to consider any possible 
simplification potential and make use of all available flexibility. 

Simplification  efforts:  An  action  plan  was  adopted  in  2015,  implementing  a  re-
organisation  of  the  ITER  Organization,  closer  cooperation  with  the  domestic  agencies, 
freezing of designs, the establishment of a Reserve Fund, and a new reliable schedule and 
cost estimates leading to a new baseline. As a result, there is now more attention given to 
critical  in-kind  deliverables.  This  is  particularly  important  for  the  European  in-kind 
contribution,  which  represents  45%  of  the  total  and  has  important  components  on  the 
critical path to First Plasma. 

Flexibility: The Commission has been making maximum use of the available flexibility 
under  the  terms  of  the  ITER  Agreement  and  within  the  governance  structures  of  the 
ITER  Organization  to  affect  important  changes  in  the  project's  management  and 
governance. However, flexibility is limited, as EU is bound by the ITER Agreement and 
must ensure its contribution to the project is under the collectively agreed baseline. 

4.  POLICY OPTIONS, INCLUDING ASSOCIATED RISKS 

4.1.  Options for delivery mechanisms 

Based on experience, the following options for delivery mechanisms in the next MFF are 
conceivable:  

Option 1 - Business as usual - dedicated budget line in MFF  

The financing of EU participation in ITER project and BA activities within the MFF is 
ensured  through  a  dedicated  budget  line  -  as  in  the  current MFF.  This  approach  would 
allow  some  flexibility  in  terms  of  the  period  covered  under  the  next  MFF  as  it  could 
ensure the financing of ITER and ITER-related activities for up to seven years, under the 
timeframe of the next MFF. It would thus avoid for example the limitation of five years 
foreseen in Article 7 of the Euratom Treaty for the Research and Training Programmes. 

The current status also allows putting in place a mechanism to ensure that the large-scale 
projects  which  may  suffer  from  delays  and  cost  overruns  do  not  affect  the  support  of 
other  European  policies  by  ring-fencing  the  budget  for  the  project  and  giving  clear 
visibility to it. 

It is important to underline that the purpose of the overall European contribution to the 
project  is  to  finance  the  current  construction  phase  of  ITER  in  a  simple  and  efficient 
manner, preparing the grounds for its future operation/exploitation in a subsequent phase. 
Therefore, keeping the same approach as in the past allows the management of the ITER 
budget  in  an  appropriate  manner  through  the  European  domestic  agency  (Fusion  for 
Energy)  set  up  to  implement  the  European  contribution  to  ITER,  avoiding  specific 
implementing  provisions  in  terms  of  participation,  rules,  planning,  evaluation  that  are 
redundant to those applied by the European Domestic Agency. 

Option 2 - In a wider programme within MFF 

The financing of EU participation in ITER and BA within the MFF is ensured through 
the  Euratom  research  and  training  programme  or  a  specific  research  programme  like 
Horizon  2020.  This  was  the  approach  adopted  in  the  previous  MFF  where  ITER  was 
financed within a wider programme, together with other research activities. 

14 

 
 
This  financing  modality  required  compliance  with  a  series  of  requirements  in  terms  of 
participation,  rules,  planning,  monitoring  and  evaluation  which  are  specific  to  EU 
programmes  (in  particular  the  fusion  research  programme  linked  to  ITER)  and  overall 
were not adapted to the specificities of the ITER construction. These requirements were 
redundant given the competencies and role assigned to Fusion for Energy in its Statutes. 

However,  it  is  important  to  underline  that  this  approach  ensured  improved  synergies 
between  the  fusion  energy  research  activities  under  the  Euratom  programme  and  the 
ITER  activities,  which  are  all  key  elements  of  the  Fusion  Roadmap  towards  the 
development of fusion energy. 

Option 3 - Intergovernmental 

The  financing  of  participation  in  ITER  and  BA  outside the  MFF  is  provided  through  a 
dedicated  intergovernmental  arrangement  involving  the  pooling  of  contributions  from 
some or all of the EU Member States. 

In 2011, in its Communication for the current MFF (“A Budget for Europe 2020”), the 
Commission proposed to fund ITER outside the MFF. For this reason in December 2011, 
the Commission adopted a proposal for a Supplementary Research Programme under the 
Euratom Treaty for the period 2014-2018 to cover ITER funding outside the MFF.  

This programme was meant to be funded by the contributions from EU Member States 
and Associated States to the EU budget, on the basis of the call rate applied to their Gross 
National Income (GNI) for the contribution to the General Budget of the EU. However, 
this approach was not accepted by the European Council which in February 2013 decided 
to  reintegrate  ITER  within  the  MFF  for  the  period  2014-2020  in  line  also  with  the 
European Parliament request. 

Option 4 – Public-Private Partnership (PPP) 

The  financing  of  participation  in  ITER  and  BA  is  arranged  through  a  form  of  public 
private  partnership  with  its  own  legal  entity  and  funding,  with  contributions  from 
Member States, the private sector, and the EU. 

A public-private partnership (PPP) is a contractual agreement between a public authority 
and a private entity. This agreement ensures that the skills and assets of both public and 
private  stakeholders  are  combined  effectively  to  deliver  a  utility/service  for  general 
public  use.  PPPs  are  actually  a  mechanism  for  public  authorities  to  procure  and 
implement  public  infrastructure  and  services  by  utilising  private  sector’s  resources  and 
expertise and are usually created to deliver a project or a service traditionally provided by 
the public sector. A PPP is an appropriate financing scheme to reduce significant up-front 
funding  requirements,  and  they  range  from  fully-public  responsibility  to  fully-private 
responsibility, depending on the project. The following figure shows the different options 
for PPP agreements.  

15 

 
 
The spectrum of PPP agreements14 

In  any  of  these  schemes,  value  for  money  is  only  achieved  by  exploiting  the  private 
sector’s  competencies  and  allocating  responsibilities  and  risks  between  the  public  and 
private collaborators. 

Although  ITER  has  already  had  a  positive  impact  on  industry,  innovation,  growth  and 
employment, the project is in an early stage of development, dependant on public funds 
at a global scale. This is because it is not in a demonstration or pre-commercial phase; yet 
not  attractive  enough  to  private  investors  that  would  like  to  obtain  a  fast  return  out  of 
their  investment.  In  addition, in  terms  of  legal  structure, the  legal  provisions  should  be 
further  analysed  to  ensure  that  the  PPP,  which  is  broadly  used  under  the  TFEU,  could 
also be used for fusion activities. 

4.2.  The preferred approach, including risk identification and mitigation 

In accordance with the general objective of ITER-related EU action in the next MFF to 
fully support the continuation of ITER construction and to reach the operation of ITER 
with First Plasma by 2025, funding through a dedicated budget line remains the preferred 
funding  mechanism  in  the  next  MFF.  This  delivery  mechanism  would  imply  a  clear 
recognition  of  the  importance  of  ITER  as  a  large-scale  research  infrastructure,  while 
ensuring the best synergies with the research fusion activities under the Euratom research 
programme in the next EU budget. This essential link would ensure the coherence of the 
whole EU effort for the development of fusion as a source of energy and it would also 
allow ITER to benefit from certain administrative provisions available only to research-
family programmes. 

A  self-standing  budget  line  within  the  MFF  would  furthermore  contribute  to  enhanced 
visibility, transparency and accountability, subjugating the management of the allocated 
funds to strict internal discipline and to public scrutiny while appropriately ring-fencing 
the budget, in line with the objective of simplification.  

In  fact,  the  inclusion  of  the  ITER  financing  in  a  wider  programme  within  MFF  could 
hamper the overall objective of the European contribution to the project and the financing 
of the current construction phase of ITER in a simple and efficient  manner through the 
European Domestic Agency. 

However,  funding  through  a  dedicated  budget  is  also  linked  to  a  number  of  risks.  In 
terms of the organisational side, the MFF offers less flexible conditions that do not allow 

14 https://ppp.worldbank.org/public-private-partnership/agreements 

16 

 
 
 
                                                            
an adequate amount of contingency planning. As a consequence, on a project as large and 
complicated as ITER, this adds a level of uncertainty to the overall management.  

The separation between ITER and other EU funded scientific projects (for example those 
supported under the successor to Horizon 2020) might also impact the potential research 
synergies between nuclear fusion projects and other scientific programmes. 

Finally,  political risks  are  also  present  under  this  option  linked  to  the  discussion  of  the 
European  Council  and  Parliament  over  annual  funding  priorities  and  over  the 
effectiveness  and  the  need  for  fusion  projects,  including  ITER.  These  risks  could 
materialise  in  a  reduction  of  the  available  funding  causing  further  delays  and  slowing 
down the progress towards reaching the stage of First Plasma in 2025. 

4.3.   Proposed legal basis 

As regards the  intended  legal instrument, the implementation  of the approved funding 
would require a modification of the Council Decision establishing F4E in the same way 
as was done in 2013 for the current MFF.  

This  modification  of  the  Council  Decision  adopted  as  a  legal  basis  for  the  European 
participation in ITER for the whole duration of the project (35 years) would replace the 
provision on the current MFF funding amount with a similar provision reflecting the next 
MFF figure15.  

In addition to these minimum interventions, one could envisage a more radical revision 
of F4E Statutes to simplify and improve the functioning of the Governing Board (e.g. by 
creating  an  executive  committee  with  a  limited  number  of  participants  and  decision-
making powers on clearly defined matters). 

5.   RESULTS AND IMPACTS 

5.1.   Programme structure 

The  scope  of  the  project  has  not  changed  and  activities  have  not  been  added  under the 
new baseline. While de-scoping would affect the ultimate utility and effect of the planned 
ITER  experiments  and  their  relevance  for  fusion  advancement,  the  rebaselining 
conducted  by  the  ITER  Organization  in  close  collaboration  with  the  ITER  Parties' 
Domestic Agencies, and notably F4E, made every use of possible savings from scope and 
activities optimization. 

5.2.   Programme priorities 

In  light  of  the  above-mentioned  general  and  specific  objectives,  the  first  and  utmost 
priority is  the  construction  of  ITER  (specific  objectives  n°1  to  4),  following  the  staged 
approach  of  the  new  baseline  with  the  critical  path  of  First  Plasma  by  2025  and  full 
Deuterium-Tritium operation by 2035.  Funding for the construction of ITER below the 
critical  mass  ensuring  adherence  to  the  new  baseline  would  entail  additional  delays 

15  On  this  occasion  the  Council  Decision  could  cover  additional  issues  like  (i)  inclusion  of  the  administrative 
expenditure of the Commission for ITER and the other related activities; (ii) provisions for mid-term evaluation for the 
next  MFF  period;  and  potentially,  and  (iii)  modifications  to  the  governance  structure  of  F4E,  including  possible 
recalculation of the UK voting rights, in light of Brexit. 

17 

 
 
                                                            
resulting in turn in increased costs and undesirably exposing the EU vis-à-vis the other 
parties in the joint international legal commitment. 

The  second  priority  is  the  continued  provision  of  the  EU  contribution  to  the  Broader 
Approach  activities  with  Japan  (specific  objective  n°5),  which  also  rests  on  a  legal 
agreement  and  for  which  significant  funds  have  already  been  invested.  Exploitation  of 
the  facilities  built  in  the  current  MFF  by  EU  scientists  (JT60SA)  needs  to  be  actively 
pursued, in order to capitalize on the value of the investments made so far. 

The third priority is the continuation of activities in preparation of the next stages in the 
development  of  fusion  as  an  energy  source,  which  follow  the  completion  of  ITER  and 
build  on  its  results.  At  present,  these  activities  notably  concern  steps  towards  an 
International  Fusion  Materials  Irradiation  Facility  -  IFMIF/DONES  (specific  objective 
n°5)  whose  results  together  with  the  lessons  from  ITER  will  enable  the  future 
construction of DEMO.  

5.3.   Critical mass of funding  

The  critical  mass  of  funding  needed  corresponds  to  the  new  ITER  baseline  for  the 
construction  of  ITER.  The  updated  schedule  and  associated  cost  estimates  present  the 
earliest technically achievable date for the ITER construction without any contingencies 
and therefore assumes that all major risks can be mitigated. The critical mass of funding 
corresponds to a system-critical set of activities:  

(i.)  the  estimated  cost  of  in-kind  contributions  due  from  EU,  to  be  delivered  to  IO  by 
F4E;  

(ii) EU cash contributions to the funding of IO activities, which in the next MFF period 
will notably entail the assembly, commissioning and start of operations;  

(iii.)  supporting/complementary  activities  mandated  by  F4E  Statutes  (notably  those 
related  to  cooperation  with  Japan  under  the  Broader  Approach  and  the  preparation  of 
TBM, DONES, DEMO);  

(iv.) overhead: administrative costs of F4E and of requisite COM resources.  

The estimated cost of European in-kind contributions to IO has been prepared by F4E on 
the basis of the new ITER Project baseline and validated by the F4E Governing Board; 
the  Governing  Board  also  acted  on  the  basis  of  the  results  of  independent  reviews. 
Reduction of funding would thus impact the delivery of these components in accordance 
with the new baseline, which in case of items on the critical path directly translates into 
overall project delays and associated future additional costs.  

The  cash  contributions  to  the  IO  are  set  as  EU  obligations  on  the  basis  of  the  new 
baseline  approved  ad  referendum  by  the  ITER  Council;  they  have  already  been 
rigorously optimized compared to the original baseline proposed by the IO.  

“Other F4E activities” ensure successful future progress of fusion development through 
continued  collaboration  with  Japan,  as  well  as,  notably  as  regards  DONES,  the 
preparations  for  transition  from  ITER  to  DEMO  along  a  cost-  and  time-efficient  path, 
and provide continuity of knowledge and availability of skilled human resources.  

18 

 
 
Finally,  the  estimated  administrative  costs  reflect  the  fact  that  F4E  has  to  be  staffed  at 
appropriate levels to ensure timely design, procurement, delivery, and quality assurance 
for all components under its responsibility16.  

Overall, adequate provisioning for contingencies should be an integral part of decisions 
with  respect  to  EU  participation  in  ITER  so  as  to  allow  the  EU  to  deliver  on  all 
commitments  and  avoid  reputational  risks  in  case  of  unexpected  adverse  developments 
which cannot be excluded in first-of-a-kind projects. In that spirit, the Commission will 
insist on internal savings in both IO and F4E where possible during the execution of the 
project, with the aim to enforce strict budgetary discipline on an enduring basis.  

In conclusion, the critical mass of funding needed to make  the ITER-related EU action 
work  effectively  corresponds  to  the  new  ITER  baseline  for  the  construction  of  ITER. 
Anything  below  this  critical  mass  leads  to  less  EU  added  value  and  generates 
inefficiencies on the path to fusion power by the end of the century. 

5.4.   The necessary volume of resources  

The resources needed for the completion of the new baseline are presented in detail in the 
Commission  Communication  "The  EU  Contribution  to  a  Reformed  ITER  Project"  and 
the accompanying Staff Working Document. The key figures are reproduced in Annex 3. 
In  a  nutshell,  the  proposed  budget  allocation (including  the  Commission  administrative 
costs) for the period 2021-2027 is EUR 6 070 million (in current prices)17.  

5.5.   Economic, social, and environmental impacts 

Economic  impacts:  The  Euratom  investment  in  the  construction  of  ITER  is  bringing 
important  benefits  to  European  industry  and  research  community.  Overall,  EUR  1.8 
billion  is  expected  to  be  contracted  out  by  the  ITER  Organization  from  now  to  2025, 
particularly  in  areas  like  diagnostics,  remote  handling,  heating  systems  and  high 
technology solutions, opening up new opportunities for industries and SMEs in European 
regions that were so far not featuring prominently amongst the beneficiaries.  

Social  impacts:  An  ongoing  “Value  for  Money”  study  commissioned  to  an  external 
contractor highlighted that: 
i. 
The  current  payments  on  ITER  by  F4E  are  already  having  significant  positive 
impacts compared to no spending, with 18 000 job years created to date, including 6 000 
in  2017 alone; and  almost  EUR 2.9 billion in Gross  Value Added (GVA)  to  date, with 
more than €1 billion in GVA estimated in 2017. 

ii. 
In  total,  F4E  spending  is  expected  to  deliver  a  gross  extra  GVA  of  EUR  12.7 
billion and 61 000 job years between 2018 and 2030. This does not include benefits from 
spin-offs, new products, new business opportunities, etc. 

16 Its current establishment plan had to be complemented in the course of the current MFF by provisions for temporary 
reinforcements in view of the peak in procurement activities necessary for successful completion of the construction. 
Under the revised schedule within the new baseline, the peak partly shifts into the next MFF period before an expected 
decline in the second part of the upcoming MFF, as the ITER project transits towards assembly and start of operations, 
which should prompt a re-evaluation of human resources needs. 
17 This figure represents an estimate without contingency on time or cost. 

19 

 
 
                                                            
iii. 
In the medium to longer term there is likely to be a positive return on investment 
from the EU commitment to ITER, similar to those based on the evidence from other Big 
Science projects such as CERN and ESA.  

Environmental impacts: ITER is the only project of its kind in the world aiming to enable 
fusion as a new energy source before the end of the century. It therefore contributes to 
the strategic agenda of the European Union for clean and secure energy.  

Fusion  is  a  climate  friendly  energy  source,  as  it  does  not  produce  greenhouse  gases  or 
long-lasting  radioactivity  and  the  fuel  used  is  widely  available.  By  the  end  of  this 
century, fusion energy could become a suitable complement to renewables in the energy 
mix  and  provide  baseload  electricity.  This  is  particularly  important  following  the  2015 
Paris Agreement and the EU commitment to lead the way in decarbonising the economy 
and tackling global climate change in a cost-effective manner. 

6.   MONITORING AND EVALUATION 

Following  the  radical  overhaul  of  the  project  deployed  in  the  past  three  years,  various 
performance monitoring and evaluation tools have been fine-tuned and are in place both 
at the ITER International Organization level and the F4E level. 

6.1.  Performance monitoring in ITER Organization 

Since  the  end  of  2016,  in  the  context  of  the  proposal  of  a  new  baseline  for  the  ITER 
project, the IO has progressively put in place a number of indicators allowing a thorough 
monitoring  of  ITER  project  progress  and  identifying  potential  problems  or  risks  at  an 
early stage. 

These  indicators  are  ITER  Council  milestones,  internal  project  milestones  and  Key 
Performance Indicators (KPIs).  

The  IC  milestones,  covering  the  period  from  2016  through  to  2025,  are  drawn  from 
critical path major achievements and other major component deliveries for First Plasma. 
They serve to monitor the evolution of the project by alerting if there is an increased risk 
of missing any critical and near critical path milestones. Conversely, the achievement of 
these  milestones  provides  increased  confidence  that  the  critical  and  near  critical 
milestones will be met, and that the project is on track. The IC Milestones indicate the 
achievement  of  the  responsible  party  and  the  achievement  status  relative  to  its  planned 
date. The IO has committed to the ITER Council to propose additional Milestones on a 
rolling basis of two years, at the end of each year.  

In  parallel,  the  ITER  Organization  established  a  much  more  extensive  list  of  so-called 
internal project milestones, with set threshold dates and an automatic warning when a 
forecast date goes beyond its threshold. The delay that can occur before the warning is 
given  depends  on  the  criticality  of  the  milestone:  for  more  critical  milestones  this 
difference between the threshold date and the reference date is much shorter than for less 
critical  ones.  Similarly,  the  IO  also  introduced  programmatic  milestones,  which  are 
mainly related to recruitment of staff and implementation of independent reviews. 

However, IC milestones having a limited value to understand the project’s overall status, 
the  IO  also  introduced  Key  Performance  Indicators,  grouped  within  nine  scorecards 
which  cover  the  physical  progress,  finance,  staffing,  risk  and  opportunities,  health  and 

20 

 
 
safety, earned value management, etc. The Management Committee monitors the choice 
of KPIs and is observing their performance. 

The  ITER  Organization  also  regularly  reports  on  risk  and  opportunities  management, 
which includes top-level risks and the actions taken to address them. 

Finally,  the  other  tools  that  are  used  to  monitor  the  project  are  independent  focused 
reviews  on  specific  areas  (e.g.  risk  management,  freezing  of  design  interfaces).  The 
reviews aim to identify actual or potential problems, and providing recommendations to 
the  IO  on  how  to  handle  them.  An  action  plan  is  established  to  address  these 
recommendations, with clear indicators and timelines.  

Every  two  years  there  is  a  management  assessment  review,  which  is  appointed  by  the 
ITER Council as per the provisions of Article 18 of the ITER Agreement, and charged to 
conduct  an  independent  assessment  of  organizational,  management,  administrative  and 
financial issues arising during the implementation of the ITER project. 

6.2.   EU participation in the ITER project's governance and supervision  

Furthermore, 
the  Commission  has  designed  a  comprehensive  strategy  for  EU 
participation in the ITER project's governance and supervision. The strategy focuses on 
steps and improvements feasible within the present legal framework. The main objectives 
of  the  strategy  concentrate  on:  1)  the  IC  shall  effectively  steer  the  IO  by  providing 
strategic directions to achieve the agreed goals; 2) the IC shall closely supervise the IO, 
based  on  regular  information  and  in  accordance  with  the  ITER  baseline  (budget  and 
schedule for the intended scope); and 3) the EU will secure its interests in the governance 
of ITER. This strategy is implemented during 2018. 

The  Commission  is  working  on  streamlining  the  ITER  governance  to  make  it  more 
efficient. In this respect, a group was set up by the ITER Council to analyse and reduce 
where  possible  the  number  of  sub-committees.  The  results  led  to  the  abolishment  of 
several sub-committees of the ITER Council and a more effective governance structure. 
However,  further  work  needs  to  be  undertaken  to  ensure  improved  governance  of  the 
project, and the EU is working with the other ITER Parties in this field. 

6.3.   Commission's oversight of Fusion for Energy  

The Commission's oversight of Fusion for Energy relies on three different categories of 
supervision  tools:  governance  bodies  (Governing  Board  and  Committees),  regular 
structured  monitoring  (using  reporting  as  well  as  regular  audit  actions),  and  ad-hoc 
supervisory tools (mainly for tackling emergency situations).  

The  Governing  Board  (of  which  the  Commission  is  a  member  together  with  the  EU 
Member States and Switzerland) and its subsidiary bodies (in some of which the EU is 
also  represented)  are  responsible  for  the  overall  supervision  of  F4E.  Compared  to  the 
other  members  of  the  Governing  Board,  the  EU  has  a  different  role  as  the  largest 
contributor  of  the  budget,  the  responsibility  to  report  to  the  European  Council  and  the 
European  Parliament,  and  the  supervision  of  Fusion  for  Energy  as  a  European  Joint 
Undertaking,  which  means  F4E  has  to  follow  the  financial  and  staff  regulations  of  the 
European Commission or regulations specifically set up.  

21 

 
 
This  specific  budgetary  and  institutional  role  of  the  European  Commission  implies  a 
particular responsibility of the Commission with respect to the supervision of Fusion for 
Energy.  

The Commission has recently developed a comprehensive supervision strategy for F4E, 
which  sets  out  the  supervision  needs,  the  objectives  for  the  supervision  activities,  the 
tools to be used, the working methods and procedures needed to achieve the supervision 
objectives,  and  the  scope  of  application  of  "the  reservation  on  legality  principle".  The 
supervision strategy is designed to enable the effective oversight of EU's performance in 
discharging its obligations to ITER. This proposal is being formalised into the recast of 
the current Administrative Arrangement between F4E and the Commission. 

6.4   KPIs and milestones for next MFF 

In  the next MFF, DG ENER proposes  to  use two indicators in  relation to  ITER. These 
indicators should report on progress of the project towards the achievement of its general 
and specific objectives. 

The first indicator would be the “percentage of completion of ITER construction” and the 
second  the  “percentage  of  Euratom’s  in  kind  obligations  discharged  by  F4E”.  Both 
indicators will be based on data reported by the ITER Organization. 

The Commission has also formulated a set of KPIs for its supervision of F4E, including 
Earned  Value  Management  (EVM).  Key  Performance  Indicators,  reflecting  in  a 
measurable  value  how  effectively  key  objectives  are  being  attained,  are  indeed  an 
integral  part  of  F4E's  regular  reporting.  KPIs  need  to  effectively  monitor  F4E 
performance and progress in the short (running year) term and long term, in terms of both 
schedule and budget, and provide objective warnings to management in an early phase.  

F4E uses a set of KPIs to monitor its performance against the agreed schedule and budget 
(project  plan  milestones,  signature  of  procurement  arrangements,  calls  for  tender 
published, contract and grant signatures, Governing Board milestones, contract execution 
milestones, risk management, etc.).  

22 

 
 
 
 
 
ANNEX 1: EVALUATION RESULTS 

1.  Evaluations 

In  the  context  of  restructuring  the  baseline,  both  the  ITER  Organization  and  F4E  were 
subject  to  various  evaluations.  Multiple  reviews  and  evaluations  of  ITER  Organization 
and  F4E  have  been  carried  out,  either  assessing  operational  capacity/performance  in 
general  (e.g.  ITER  Organization  bi-annual  management  assessments  and  F4E  annual 
assessments)  or  targeting  specific  key  topics  (e.g.  risk  management  review,  freezing  of 
interfaces review). 

a. 

ITER Organization evaluations 

In accordance with the ITER Agreement, management assessments of IO are undertaken 
bi-annually  by  external  experts  appointed  by  the  ITER  Council.  These  have  played  a 
crucial  role  in  the  transformation  of  the  project.  The  2013  ITER  Organization 
management assessment revealed a number of problems and prompted profound changes 
in  the  IO’s  top  management  followed  by  the  elaboration  of  the  new  baseline.  The 
subsequent bi-annual management assessments of 2015 and 2017 confirmed the positive 
trend  in  the  reform  of  the  project.  The  2017  assessment  in  particular  confirmed  the 
substantial improvement of the ITER Organization management by the current Director-
General (DG), contributing to reduced risks of straying from cost and schedule control. 

In addition to these statutory bi-annual assessments, the IO has also been subject, for the 
past two years, to independent ad hoc reviews. The 2016 ITER Council Review Group 
(ICRG)  assessed  the  processes  used  for  preparing  the  new  baseline18.  It  confirmed  the 
validity of the staged approach and the 2025 date as the earliest technically feasible date 
for First Plasma as well as the robustness of the processes used by IO for the elaboration 
of  cost  estimates  for  the  new  baseline.  On  the  basis  of  the  input  from  ICRG,  the  new 
baseline was adopted by the ITER Council.  

Furthermore, the ITER Council established the instrument of ad hoc independent reviews 
targeting specific key topics (e.g. risk management, freezing of design interfaces). These 
are  organized  under  the  ITER  Council's  mandate  by  the  Management  Advisory 
Committee  and  independent  experts engaged by it, aiming  at  assessing critical areas of 
the project and IO's activity, and providing recommendations to the IO for improvements 
where necessary.  

b. 

F4E evaluations 

In parallel, F4E is also subject to detailed reviews. Following the request by the Council 
in its July 2010 conclusions, an assessment of the project progress is performed annually 
by  independent  experts  and  the  outcome  is  reported  to  the  Council  and  the  European 

18  This  followed  the  rejection  of  a  previous  suggested  baseline,  “the  Updated  Long-Term  Schedule”,  which  was 
proposed in November 2015 and rejected by the ITER Council because it did not address all issues and did not take 
into  account  the  constraints  of  the  Members.  The  ITER  Council  agreed  to  form  the  ITER  Council  Review  Group 
(ICRG) to assess the rejected Updated Long Term Schedule (with the associated costs/resources). The final report of 
the ICRG on the Updated Long-Term Schedule was fully in line with the concerns raised by the EU delegation in the 
ITER Council. 

23 

 
 
 
                                                            
Parliament.  In  June  2016,  in  the  frame  of  the  yearly  assessment,  the  Governing  Board 
asked  for  a  review  of  the  new  plan  for  the  delivery  of  the  components  under  EU 
responsibility  and  the  associated  resource  estimates  (F4E  2016  Assessment)19.  The 
results of this high-level independent review confirmed the capacity of Fusion for Energy 
to  deliver  the  EU  contribution  to  the  new  ITER  schedule  on  time  and  in  line  with  the 
staged  approach.  This  review  also  underlined  the  capacity  of  the  Joint  Undertaking  to 
deliver  the  required  components  within  the  current  available  budget  until  2020  and  the 
cost projections made thereafter.  
In the last annual assessment report of 2017, the review Panel20 stated that F4E has made 
significant  progress  in  management  and  performance  over  the  past  2-3  years  and  is 
positioned  to  make  the  transition  to  a  non-“emergency”  state.  The  commitment  of  the 
management  in  reforming  the  project  was  recognized,  while  highlighting  further  issues 
that  F4E  management  and  governance  instances  need  to  focus  on  to  solidify 
performance. 

c.  Mid-term evaluation 

A mid-term evaluation of European participation in the ITER project is being carried out 
complementary to the evaluations of F4E and the IO presented above. Its objective is to 
evaluate the results of the European contribution to the ITER project carried out by F4E 
in the period 2014-2017. It builds on a value-for-money analysis prepared by an external 
consultant to DG ENER early 2018. The evaluation report will present a comprehensive 
overview of the European contribution funded annually from the EU budget, France, and 
F4E members, and will outline the results obtained through that funding to date, before 
providing an evaluative analysis of the results. The evaluation covers the  Effectiveness, 
Efficiency,  Relevance,  Coherence,  EU  added  value,  and  Acceptability  of  the  European 
contribution to ITER. It will be completed in Q2/2018 and will be made available to the 
Council  of  the  EU  and  European  Parliament.  Preliminary  results  of  this  evaluation 
indicate that: 

a.  All  three  objectives  of  F4E  are  currently  pursued  according  to  a  planning 
consistent with the new ITER project baseline, Broader Approach agreement and 
the EU Fusion Roadmap.  

b.  Over  the  evaluation  period  the  European  contribution  to  ITER  was  subject  to 
major  changes  in  terms  of  management  structure.  The  direct  results  from  the 
changes  in  management  can  be  considered  to  be  positive  and  promising  of 
sustained  more  effective  implementation  of  the  project  including  cost  and 
schedule control and risk management.  

c.  The  achievement  of  ITER  credits  by  F4E  is  mostly  in  line  with  the  current 
baseline  which  is  a  clear  positive  change  compared  to  earlier  periods.  Indirect 
positive  changes  are  also  perceived  by  surveyed  stakeholders  such  as  IO  and 
contractors who state an increased motivation and enthusiasm in the work of F4E.  
d.  The new baseline is considered to be realistic and appropriate for the achievement 
of ITER. The new baseline entails additional costs for the European contribution 

19 F4E Governing Board decided to engage the European experts who have participated in the ICRG panel. 
20 The 2017 annual assessment review panel included for the first time a non-European expert (former Undersecretary 
for Science and Energy of the US Department of Energy who was the head of US delegation to the ITER Council for 
two years). 

24 

 
 
                                                            
to  ITER  after  2020  while  the  Euratom  cap  on  expenditure  until  2020  will  be 
respected.  

e.  Within  the  limits  of  methodological  difficulties,  the  data  available  from 
stakeholders  suggest  that  the  European  contribution  to  ITER  is  cost-effective, 
both, for its administrative spending as well as for its operational spending.  

f.  Contracts for the major share of Europe’s contribution have already been placed 
with the industry and research institutions. The number and value of contracts and 
grants  awarded  by  F4E,  as  well  as  their  geographical  spread,  provides  a  clear 
indication  that  the  European  contribution  to  ITER  has  benefited  the  European 
economy  significantly.  From  a  quantitative  perspective,  significant  amounts  of 
contracts and grants have resulted in job creation and turnover increase. Also, the 
nature of the contracts leading to first-of-a-kind products is considered to provide 
the  participating  European  companies  advantage  in  terms  of  innovation  and 
competitiveness. 

g.  Europe’s participation in ITER is considered fully in line with Euratom research 
and  training  programme  as  well  as  long-term  energy  and  carbon  objectives;  the 
characteristics of fusion energy which as a body makes them unique lead to high 
complementarity with other carbon neutral energy sources such as renewables or 
hydrogen.  However,  given  the  long  timeline  for  a  projected  first  availability  of 
commercial fusion energy, the project does not directly contribute to current and 
mid-term needs.  

h.  Insights from the available data strongly suggest that an intervention at Euratom 
as  compared  to  EU  Member  State  level  at  least  until  the  end  of  ITER’s 
construction period is crucial in terms of resource availability as well as to reduce 
project complexity. 

2. 

Key responses to lessons learned from evaluations  

As a consequence of the Management Assessment of 2013, the project management was 
significantly  restructured  in  IO  and  a  new  top  management  team  was  appointed  early 
2015 with a clear mandate to stabilize the project, prepare a new baseline and implement 
robust project management culture and practices in the ITER Organization.  
This is formally captured in the 2015 IO DG Action Plan21, which pursues a complete 
re-organisation of the ITER Organization, reinforcement of IO's cooperative relationship 
with  the  domestic  agencies22,  accelerated  freezing  of  design  processes  to  stabilize  the 
construction of buildings and manufacturing of components, and the establishment of a 
Reserve Fund to cover additional costs entailed by design changes approved by the ITER 
Organisation. The action plan also focused on cost control and the establishment of a new 
reliable schedule and associated cost estimates that should lead to a new baseline. 

21  A  complementary  action  plan  was  adopted  by  the  Governing  Board  of  Fusion  for  Energy  in  2015  that  led  to  the 
creation of a project management department to reinforce planning and control processes, the redeployment of staff to 
high priority areas and the strengthening of project control, risk management and cost containment measures. To date 
80% of the actions have been implemented. 
22  In  particular,  “Joint  ITER  Organization  -  Domestic  Agencies  project  teams”  were  set  up  in  key  project  areas, 
supervised  by  a  joint  project  management  body  (the  Executive  Project  Board),  allowing  early  identification  and 
resolution of problems. 

25 

 
 
 
                                                            
Changes in the management and organization of Fusion for Energy (F4E) took place in 
parallel and entailed the change of the Director (early 2016) and the majority of the top 
management and its organization. In 2015, F4E implemented an internal restructuring of 
activities  and  resources  (the  so-called  “Straight  Road  to  First  Plasma”)  focused  on 
actions in support of the action plan of the ITER Organization. The Straight Road to First 
Plasma  involved  an  improvement  of  the  contract  management  tools;  merging  of 
configuration management tools with those of the ITER Organization; implementation of 
a  system  to  manage  cost  estimates  and  fund/contingency;  and  creation  of  a  Project 
Management Department to reinforce planning and control processes. 

Overall,  the  key  findings  and  lessons  learned  from  the  reviews/evaluations  allowed  the 
new  managements  of  IO  and  F4E,  and  the  new  baseline,  to  effectively  address  the 
following critical elements: 

  Better grasp of the technical complexity of a unique project where many components 

are first of a kind; 

  Focus  on  completion  of  design  to  avoid  modifications  of  procurement  contracts  or 

amendments during execution, which lead to further cost increases and delays; 

  Process  organization  and  project  management,  in  particular  project  management 
focus  on  cost  and  schedule  and  industrial  expertise,  both  in  the  ITER  Organization 
and F4E; 

  Governance  structure  and  processes  providing  for  effective  oversight  of  the  ITER 
Organization  and  F4E,  combined  with  coordination  and  collaboration  between  the 
domestic agencies and the ITER Organization. 

26 

 
 
 
 
 
ANNEX 2: STAKEHOLDER CONSULTATIONS  

The  opinions  of  stakeholders  were  collected  through  a  number  of  stakeholder 
consultation initiatives:  

  The MFF Open Public Consultation is organised per policy cluster and ITER is part 
of  the  “Strategic  infrastructure”  cluster.  The  Open  Public  Consultations  were 
launched  on  10  January  for  all  clusters  centrally  under  the  coordination  of  SG 
running until 8 March 2018. 

The MFF open public consultation is accompanied by targeted stakeholder consultation 
activities: 

  A targeted stakeholder consultation was carried out in the context of the “Value for 
Money” study targeting around 300 contractors. Key findings from the consultation 
with  stakeholders  have  highlighted  that  the  EU  investment  in  the  construction  of 
ITER  is  bringing  important  benefits  to  European  industry  and  the  research 
community giving them the opportunity to engage in cutting-edge R&D, technology, 
design and manufacture work for ITER components. Between January 2008 (the start 
of  ITER  activities)  and  December  2016,  Fusion  for  Energy  awarded  839  contracts 
and  grants  for  a  value  of  approximately  EUR  3.8  billion  throughout  Europe.  Some 
300  companies  including  SMEs  from  about  20  different  EU  Member  States  and 
Switzerland,  as  well  as  some  60  research  organisations  have  benefited  from 
investment  in  ITER  activities.  Furthermore,  the  ITER  Organization  as  well  as  the 
domestic  agencies  and  industries  of  other  ITER  Parties  have  also  signed  contracts 
with  European  industry  to  support  the  manufacture  of  their  own  components  for 
ITER. This investment also offers European high-tech industries and SMEs a unique 
opportunity  to  innovate  and  develop  “spin  off”  products  for  exploitation  outside 
fusion. 

  Follow-up  to  the  publication  of  the  Commission  Communication:  With  this 
Communication,  the  Commission  launched  inter-institutional  discussions  with  the 
Council  of  Ministers  and  the  European  Parliament  on  the  new  ITER  baseline.  The 
Commission  adopted  the  ITER  Communication  in  June  2017  to  present  the  radical 
changes brought to the project to put it back on track, including the thorough revision 
of  the  project’s  baseline.  The  revision  of  the  baseline  and the  management  changes 
were  the  most  significant  requests  made  by  independent  experts  and  stakeholders, 
including  the  European  institutions,  to  ensure  the  necessary  turnaround  of  the 
project’s past pace. With the adoption of the Communication, the Commission had no 
intention  of  pre-empting  any  future  proposal  or  outcome  of  discussions  on  the  next 
MFF,  but  rather  of  providing  the  clear  information  on  the  new  baseline  considered 
necessary  to  stabilize  the  situation  of  ITER  management  and  ensure  a  successful 
finalization  of  its  construction  on  the  basis  of  the  “staged  approach”,  which  was 
recommended  by  independent  experts.  The  new  baseline,  agreed  ad  referendum  by 
the  ITER  Council  in  November  2016,  will  be  most  effective  if  it  is  also  politically 
and formally endorsed by all ITER Parties at a ministerial meeting. The Commission 
seeks through the communication to obtain a mandate from the Council of the EU to 
take decisions at such a ministerial meeting on behalf of the EU so as to ensure that 
the project (contractors, ITER Organization, domestic agencies, etc.) can work under 
a more reliable schedule and with more accurate cost estimates. 

27 

 
 
  Industry  stakeholder  event:  During  the  “ITER  Industry  Day"  organized  by  the 
European  Commission  on  the  4th  December  2017,  on  the  occasion  of  the  10th 
anniversaries  of  the  ITER  Agreement  and  Fusion  for  Energy,  around  100  policy-
makers, senior company executives and energy experts from Europe and the rest of 
the  world  participating  in  the  ITER  project  highlighted  that  fusion  is  already 
delivering concrete opportunities for industry and is having a positive effect on jobs, 
economic growth and innovation, with positive impact beyond the fusion and energy 
fields.  
Members of the European Parliament, representatives of the EU Member States and 
international industrial stakeholders participated in panel discussions which covered 
the  direct  benefits  for  the  economy  and  society  as  a  whole  arising  from  the 
construction of the ITER project; the cross-cutting effects and indirect benefits from 
the  advanced  technologies  associated  with  the  ITER  project;  and  the  international 
technology  cooperation  stimulated  by  the  ITER  project  that  is  resulting  in  unique 
business opportunities for companies in Europe and in other countries participating in 
ITER.  
Some of the key messages expressed by the participating companies are presented in 
Annex 2a. 

28 

 
 
 
 
 
ANNEX 2A: INDUSTRY TESTIMONIALS  

To deliver the EU commitments to the project, Fusion for Energy (F4E) has so far signed almost 
1000  contracts  with  over  400  European  companies  and  60  scientific  and  research  entities  in 
more  than  20  European  countries,  for  a  total  of  some  EUR  4  billion.Here  are  some  key 
messages  expressed  by  the  companies  on  the  occasion  of  F4E's  10th  anniversary  celebration 
and at the ITER Industry Day in December 2017. 

Contracts for deliveries to ITER bring new jobs and growth to European companies 

Manufacturing  components  for  ITER  represents  a  good  opportunity  for  European  industry  to 
create new jobs, both directly in F4E's contractors and in the supply chain companies involved. 
OCEM  Power  Electronics,  an  Italian  company  specialized  in  providing  plasma  power  heating 
components,  is  a  case  in  point.  As  Giuseppe  Taddia,  General  manager  of  OCEM,  said:  "ITER 
allowed my company to double the jobs, and the same applies for our subcontractors. ITER is an 
interesting  opportunity  to  do  business,  even  if  it  is  very  challenging  on  technology  and  very 
demanding in terms of quality and reactivity." 

While  OCEM  is  working  mainly  in  the  particle  physics  and  fusion  sectors,  Belleli  Energy  is  a 
company  operating predominantly in  more  traditional  sectors,  manufacturing components  for 
the  oil  and  gas  industry.  But  through  its  involvement  in  the  European  consortium  for  the 
construction  of  the  ITER  vacuum  vessel  (a  very  sophisticated  and  crucial  component),  Belleli 
Energy has now seen significant growth in turnover and staff levels. The CEO Paolo Fedeli said: 
"Thanks to ITER, the company staff grew from 300 in 2010 to 1000 today. This includes a growth 
in the number of high-skilled engineers from 15 to 100. Although the ITER  business represents 
only  10%  of  the  company's  turnover,  the  ITER  business  line  is  the  one  giving  the  company  the 
most  dynamic  growth.  Participating  in  ITER  has  enabled  Belleli  Energy  to  expand  its  market 
share in other sectors but also in the oil and gas business which still accounts for 90% of Belleli's 
business." 

Technologies developed for ITER create new business opportunities in other sectors 

Involvement  in  deliveries  to  ITER  leads  to  the  development  of  new  technologies  which  find 
applications,  sometimes  unexpected,  in  other  business  areas.  This  is  the  story  of  Pro-beam,  a 
German  company  also  involved  in  the  manufacturing  of  the  ITER  vacuum  vessel:  "Pro-beam 
developed  the  electron  beam  welding  technology  to  provide  high-quality  welds  for  ITER 
components.  The  subsequent  use  of  this  technology  also  in  construction,  process  and  plant 
engineering,  increased  our  competitive  advantage  in  those  more  traditional  industry  sectors, 
boosting the turnover of our company in return" said Pro-beam's CEO, Thorsten Löwer.  

Working on ITER increases the competitiveness of European companies in the global economy 

Through  collaboration with fusion-related research  on superconducting magnets in the 1980s, 
in  business 
Bruker  developed  superior  know-how  on  superconductors.  This  resulted 
opportunities 
largest 
superconducting magnets for ITER. “Thanks to its involvement in fusion-related research, Bruker 
has developed from a small research entity into a major manufacturer of superconducting wires 
and is  now  a  key  global  supplier  for  Magnetic  Resonance Imaging,  a  key technology  to  detect 

including,  but  well  beyond,  the  manufacturing  of  the  world's 

29 

 
 
 
 
 
 
 
 
 
cancer and other diseases,” said  Bruker Biospin Executive Vice President Falko Busse. Bruker’s 
innovative and collaborative business approach to fusion activities helped the company gain a 
20% share in the global superconducting wire market and a 73% share in the NMR spectroscopy 
market, supporting life science research with a current annual global market value of over 700 
million Euro. As a corporation Bruker has grown 17% since 2013. 

Participating in ITER also creates major opportunities for traditional large European companies. 
With a EUR 20 billion turnover and a 100-year history, Air Liquide is a mature industrial actor. 
For its involvement in ITER, the company successfully entered the high-tech sector of cryogenics 
and  is  building  ITER's  cryoplant,  which  will  be  largest  ever  built  in  the  world.  It  required  the 
different branches of the company to work together and find innovative solutions. Air Liquide's 
Vice  president,  François  Daichis,  said:  "Our  company's  participation  in  ITER  resulted  in  5 
patented innovative  solutions  in  the field  of  cryogenics  and cooling  of  heavy  components,  and 
we are now the world leader in this sector."  

ITER provides an opportunity for traditional companies to enter the high tech market 

The German company MAN, part of the Volkswagen group, is involved in several contracts with 
ITER which allow the traditional transport manufacturer to diversify into new areas of activity, 
e.g.  to  manufacture  ports  for  the  vacuum  vessel  and  assemble  the  cryostat.  Franz  Leher, 
Business Head of MAN, said: "People are always surprised to learn that a company member of 
the Volkswagen group is involved in a very different cutting-edge project such as ITER. But the 
whole Volkswagen group is benefitting from MAN's participation in ITER. It brings new skills and 
competencies to the company, creating know-how that would not be acquired otherwise." 

All  these  stories  from  European  companies  show  how  important  ITER  is  for  the  European 
industry,  and  not  just  its  high-tech  sectors.  The  ITER  project  is  already  delivering  concrete 
opportunities  for  industry  and  is  having  a  positive  effect  on  jobs,  economic  growth  and 
innovation in Europe. ITER is pushing technology to its limits but it is already bringing a lot of 
concrete  positive  effects  for  the  economy  and  society  at  large.  Participation  in  ITER  brings 
multiple  benefits,  synergies  and  cross-cutting  effects  to  European  industry  and  research 
communities,  not  least  through  entering  new  markets  and  developing  their  international 
liaisons and global  competitiveness.  While  about 50%  of  the  value  of  the  planned  European 
contribution  to  ITER  has  already  been  placed,  the  project  offers  further  opportunities  for 
European companies in high-tech areas as well as traditional industry sectors. 

30 

 
 
 
 
 
 
 
 
 
 
ANNEX 3: VOLUME OF APPROPRIATIONS 

The table below presents an overview of the estimated European contribution (from the 
EU budget, France as Host State, and F4E Members) in current prices (EUR billion). It is 
based on the figures presented in the Commission Communication “The EU Contribution 
to  a  Reformed  ITER  Project”  (COM(2017)319)  and  its  accompanying  Staff  Working 
Document (SWD(2017)232).  

European 
contribution 

Up to the end of the current 
MFF 

Up to First 
Plasma 

From First Plasma to DT 

2007-2013 

2014-2020 

2021-2025 

2026-2027 

2028-2035 

EU budget 
France 
F4E Members 
Total 

3.36 
0.52 
0.02 
3.9 

2.96 
0.84 
0.03 
3.8 

4.56 
0.95 
0.03 
5.5 

1.51 
0.3 
0.01 
1.8 

2.58 
0.5 
0.06 
3.1 

Total after 
2020 
8.6 
1.7 
0.1 
10.4 

The table below presents the annual breakdown of the contribution from the EU budget 
(commitments) to the ITER project in current prices (EUR million). 

2021 

2022 

2023 

2024 

2025 

2026 

2027 

2021-2027 

EU 
budget 
contribution  

934 

768 

1 103 

872 

746 

926 

722 

6 070 

31