Russia’s Choke-Hold on Bulgarian Energy

After 6 days of negotiations between the Russian Atomstroyexport and the Bulgarian National Energy Company (NEC), Russia has gained the upper hand in developing nuclear power in Bulgaria. The main question in the negotiations was concerning the new nuclear power plant being built at Belene, and was supposed to end in a freezing of the project for two months, according to Boiko Borisov, Bulgaria’s Prime Minister.

Instead, an agreement has been signed, committing Bulgaria to take a final decision on the costs of Belene within two months and effectively decide the fate of the power plant. This was done without an answer to the questions on safety and financial effectiveness which Bulgaria’s Minister for Economic, Energy and Tourism, Traicho Traikov, had posed to the Russian side.

Only hours after NEC announced that it had signed the agreement, Mr. Traikov gave a press conference where he stated that Krasimir Parvanov, the head of NEC and leading negotiator, had been removed from his post. The reason for the decision was that Mr. Parvanov had overstepped his mandate in the negotiations by committing Bulgaria to a final decision on Belene. Mr. Traikov further stated that “the influence of Russia in Bulgaria is sometimes greater than the ability of individuals who have been entrusted with protecting national interests, to do their job”.

In essence, the agreement signed is an annex to the contract between Atomstroyexport and NEC which states that, before the 1st of July 2011, Bulgaria has to agree on a final contract for the construction and delivery of the reactors for the Belene nuclear power plant, whether clarification on the questions of reactor safety or investment have been cleared or not. This would also lead to Bulgaria having to invest 2 billion euro over the next two years, making the Belene project irreversible. Mr. Traikov has also stated that Mr. Parvanov was explicitly instructed not to sign such an agreement. The Bulgarian media are now calling his actions ‘a crime’ and the Russian negotiators ‘criminals’.

As a result of this fiasco, the opposition in Bulgaria’s Parliament has called on the government to answer for its actions. They have also claimed that Mr. Traikov is incompetent and have demanded that he resign. Furthermore, Ognyan Minchev, a leading political scientist, has stated in front of the Dnevnik news agency that in any other country, such a debacle would lead to the government’s resignation.

On the one hand, there is a sigh of relief. Bulgaria’s new energy strategy, from January 2011, states that the government will fully support the development of nuclear power in the country and especially the construction of Belene. The agreement signed brings these promises into a definitive context. On the other hand, the way that the agreement was made is questionable. Martin Dimitrov, leader of the Union of Democratic Powers party, has stated that Mr. Purvanov either had personal incentives to sign, or he was under a lot of pressure from the Russians.

Realistically, the idea that a member state of the European Union can allow such a breach in its national policy from another country is appalling. Bulgaria’s energy market is already dominated by imports of oil and gas from the Russian Federation, and all operations of the nuclear power plant at Kozloduy depend on Russian fuel and waste management. Now, Moscow has gone one step further in putting Bulgaria into a choke-hold when it comes to energy.

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