Oct 18 - BBC Monitoring European

The price of electricity generated by the Kozloduy Nuclear Power Plant will increase 56 per cent after the plant's Units 3 and 4 are shut down, Kozloduy Executive Director Ivan Ivanov told a joint meeting of the plant management and Parliament's Energy Committee on Tuesday [18 October].

The price increase will be partly caused by the repayment of loans received for the upgrading of Units 5 and 6, which will remain as the only operational reactors at Kozloduy, he said.

Units 1 and 2 were shut down at the end of 2002, and Units 3 and 4 are to be closed permanently by 2006 under an agreement with the European Commission. The decommissioning of the plant's four older reactors is a condition for Bulgaria's accession to the EU, which is planned to take place on 1 January 2007.

Ivanov said the planned closure of Units 3 and 4 will upset the energy balance in the Balkans because Bulgaria will no longer be able to offset the electricity deficit in the region. He recalled that under Bulgaria's Accession Treaty with the EU, the date of the reactors' closure should be linked to the building of a new generating facility. Such a facility is the future Belene Nuclear Power Plant, he said.

The committee members said the new government should take into account a Supreme Administrative Court judgment, according to which the former government's decision on the closure of Units 3 and 4 was unlawful. Some committee members suggested that the closure deadline should be reviewed in the context of regional security. The question was also discussed, what will happen with the two reactors if the so called safeguard clause is invoked and Bulgaria's accession to the EU is delayed by a year until 2008.

The Kozloduy management raised with the MPs questions concerning electricity price restrictions imposed by the State Commission on Energy and Water Regulation (SCEWR), which are expected to inflict a 40m leva (20.45m euro) loss on Kozloduy in 2006; the low negotiable pricing quota of 5 per cent; and a request to reduce from 15 per cent to 4 per cent the rate of Kozloduy's contribution to the Nuclear Reactors Decommissioning Fund, which will allow the plant to save some 80m leva (40.9m euros) annually. The finances accumulated in the fund already amount to 800m leva (409m euros), which the plant management believes is enough for the time being, but is managed ineffectively by the central bank.

Parliament's Energy Committee Chairman Ramadan Atalay said all these issues will be discussed at a special committee meeting. Economy and Energy Minister Rumen Ovcharov and SCEWR Chairman Konstantin Shushulov will be invited to the meeting.