The war in Ukraine has reshaped the European energy market. Russia has lost buyers of coal, oil and much of its gas. Now it is beginning to lose ground in the nuclear energy market.
Bulgaria and Ukraine are close to an agreement to sell two Russian nuclear reactors and other equipment from Belene, an unfinished plant that has been disputed for years, The Wall Street Journal reported. It was begun by Soviet power engineers and continued by Rosatom after a 20-year break, but work stopped in 2012.
If an agreement is reached and implemented, Russian equipment will be used to generate electricity in Ukraine.
Bulgaria’s new government has been preparing the deal in secret for weeks to prevent it from being blocked by pro-Russian parties, local officials told WSJ. On Thursday, the parliament passed a resolution binding the government to negotiate with Kyiv over the sale of reactor equipment. President Volodymyr Zelensky had just arrived in Sofia that day, and the nuclear deal was also discussed at the talks, according to officials.
At a meeting between Zelensky and Prime Minister Nikolai Denkov, a memorandum of cooperation in the energy sector was signed between the two governments. Energy was a “fundamental priority” at the talks, Zelensky tweeted.
The sides are discussing the transfer of equipment from Belene NPP by Bulgarian energy state company NEK to Ukrainian Energoatom for at least 600 million euros ($650 million), officials and other people familiar with the negotiations told WSJ. According to them, two methods of payment are being considered:
– Energoatom will receive funds from the U.S. as part of financial aid to Ukraine, a possibility being discussed by Bulgarian and U.S. officials;
– Bulgaria will receive a minority stake in Khmelnytsky, where two units are under construction, and Russian equipment from the Belene reactors will be used for them.
Ukraine, where demand for electricity has been severely curtailed by the war and a 30 percent slump in the economy, resumed exports to Europe in the spring. The new capacity will allow for increased supplies.
In Bulgaria, which has held five elections in the past two years, the positions of pro-Russian parties are quite strong. But the new government formed in June intends to combat Russian influence, which local law enforcement and intelligence agencies look on with “eyes wide shut”, Denkov said in a recent interview with Politico, using the title of a Stanley Kubrick movie.
The Belene NPP project, for which Russia has fought vigorously for more than a decade and a half, including in the courts and trying to sway public opinion in its favor, “has been a key tool in entrenching and expanding Russian influence within Bulgaria’s political and economic elite”, said Martin Vladimirov, director of the energy and climate program at the Sofia Center for Democracy Studies.
And the agreement with Ukraine is “part of a larger Western strategy to bring the Ukrainian energy market into the European orbit”, he told WSJ.
