Poland does not want to pay for the expansion of a nuclear power plant in Ukraine. It has different strategic goals and is afraid of instability. The project is a hotbed of shady deals. BiznesAlert.pl has reported about a number of incidents surrounding the enterprise. For these reasons the construction of new units at the Khmelnitskiy power plant will not replace the plans for a Polish nuclear power plant. However, no final decision has been made so far – writes Wojciech Jakóbik, BiznesAlert.pl’s editor in chief.
The Khmelnitskiy power plant is located in the city of Netishyn in the Khmelnytskyi Oblast. It is equipped with two Water-Water Energetic Reactors (WWER) both of which generate 1000 MW. At the beginning of the 1980s the company had started to construct two additional reactors, but the project was abandoned after the fall of the Soviet Union. Khmelnitskiy is operated by Energoatom.
Polish energy island
During his visit to Poland on 4 October, Ihor Nasalyk, Ukraine’s Energy and Coal Industry Minister offered to sell Poland power from the Khmelnitskiy power plant. In his opinion, it would be easier for Poland to invest in Khmelnitskiy and import energy, than to build its own nuclear plant. So far no decision has been made with regard to this proposition. According to BiznesAlert.pl’s unofficial findings, Poles were eager to talk to the Ukrainian delegation about cooperating in the natural gas sector. However, they were also upfront and dashed any hopes of cooperation with regard to the new reactors at Khmelnitskiy.
At the same time Ukraine’s Ministry of Energy and Coal Industry included the new reactors at Khmelnitskiy in its Ukraine-EU energy bridge pilot program. The money earned on exporting energy to the EU will be used to bankroll the new units. To achieve this, Ukraine will award concessions for usage of two electricity interconnections, one with Poland (Khmelnitskiy-Rzeszów) and one with Hungary (to Albertirsha). Ukraine wants to synchronize its power grid with the EU transmission system within the next few years.
The late Jan Kulczyk, PhD, and his company Polenergia were interested in the Khmelnitskiy project and wanted to cooperate with Westinghouse to import electricity via the link with Rzeszów. However, the project failed because PSE-Operator S.A., the Polish grid operator, was against it.
The hopes were also shattered by Piotr Naimski, the Polish Government Plenipotentiary for Strategic Energy Infrastructure who recently made a statement about the government’s strategy. “The strategy does not provide for the import of electricity from Ukraine’s Khmelnitskiy or Belarus’s Ostrowiec power plants, or any other sources outside of Poland,” he told journalists during the Economic Forum in Krynica. To read more on the idea of Poland as an energy island, you can go to the BiznesAlert.pl article published last June. Since Poland is not interested, Ukraine exports electricity generated in Khmelnitskiy to Belarus and Moldova.
Concerns about stability in Ukraine
In an interview for BiznesAlert.pl, our source in the Polish government explained why Poland does not want to currently engage in constructing a new unit in the Khmelnitskiy power plant.
“It is difficult to have a dialogue about the Khmelnitskiy power plant. On the one hand, we believe that it is Poland’s national interest to integrate Ukraine with Europe. On the other, the country is torn by internal disputes and the decisions made there are not always rational and sometimes originate at places that do not care about Ukraine’s interests. The decision on Khmelnitskiy depends on ensuring secure power supply from that direction,” said our source who prefers to remain anonymous.
Our interlocutor also explained why investing in Ukraine’s energy sector is not risk-free. “This is a matter of companies that operate there. Ukraine is divided into regions the majority of which is impacted by Russia.”
“A number of different interests intersect at Khmelnitskiy. It’s a swamp that cannot be comprehensively analyzed. Investing in Ukraine is a good idea, but it is also a difficult one. Perhaps this can be done better by other states that have sufficient technological potential, or maybe even military potential to help stabilize the situation and exclude bribes and other pathologies.” We asked whether they were talking about the American Westinghouse. “Yes. The other company that could play this game is General Electric. Westinghouse is experienced when it comes to adapting power plants to a new fuel. However, the company did come across various difficulties,” our source said. “The rods did not fit because someone shattered them with a hammer. It takes a lot of courage to use such a tool on a uranium rod, but it means someone had a mission.”
Another problem is Ukraine’s attitude. “Unfortunately Kiev is emotional about this and does not understand that the European market is not just an exchange, but a system of conditions that cannot be selectively treated. Ukraine has a long way to go to join this system and, from the point of view of its interests, this is not necessarily a good idea,” our source added.
Instability in Poland
The concerns about stability in Ukraine may be accompanied by similar fears about Poland. Despite the fact that the government says that officially the Polish Nuclear Energy Program is continued, but will be revised before the end of the year, representatives of the current administration unofficially admit that the decision on Poland’s first nuclear energy plant has not been made yet. The dispute with the Ministry of Environment reported on by BiznesAlert.pl is exacerbated by the search for a financing model for the plant. There are few options, but so far the government has not made a decision. This means we still do not know whether Poland will actually construct its own nuclear power plant.