The EU's electricity imports from neighbouring countries: at what cost?

June 8, 2012

Kiev -- Despite being the place of one of the most terrifying nuclear accidents in the world, Ukraine is currently working on expanding the lifespan of 13 of its old Soviet-style reactors, with electricity exports to the European Union in mind. In a study published today, CEE Bankwatch Network is revealing how the EU and its financing institutions are promoting electricity imports to the EU which are likely to have highly damaging consequences for the exporting countries.

Entitled "A Partnership of Unequals" (1), the study is made up of a series of case studies from Ukraine, Georgia and the Western Balkans, which raise concerns about how EU's plans to import electricity from these countries could negatively affect the exporters.

In Ukraine, the European Bank for Reconstruction and Development and Euratom are currently planning to finance with up to 300 million euros each safety upgrades at all Ukrainian nuclear reactors, some of which would not be necessary unless the reactors' lifespan is extended. In another EBRD financed project, an ambitious ultra high-voltage transmission line, called the Second Backbone Corridor, will link four nuclear power plants and two pumped storage plants into a continuous line and connect them with Europe. (2)

"By supporting Ukraine's ambitions to increase electricity exports from its nuclear power plants to the EU, European decision-makers are giving the Ukrainian government an extra incentive to go ahead with prolonging the life of old reactors, thus increasing overall nuclear risks in the region and pushing aside renewables and energy efficiency improvements in Ukraine," says Iryna Holovko, campaigner at the National Ecological Centre of Ukraine. "At a time when a number of European countries are choosing a nuclear-free future, no European money should be spent on supporting nuclear outside the EU."

In the case of Georgia and the Western Balkans, the main source of electricity targeted for export to the EU is hydro power. The EBRD is financing transmission lines and large hydro power plants in these countries, presenting hydro power as sustainable energy, when in fact if done improperly it can have damaging effect on biodiversity and water systems. Additionally, linking hydro development to exports to the EU from the start means that much of the countries' renewables potential will be used to meet EU clean energy targets, making it more difficult for these countries themselves to meet any targets when demanded of them.

"While electricity exports are a normal activity, the problem arises when the exporting countries have lower environmental, social and safety standards than the importing countries, and when exporting energy reduces the exporter's ability to develop its own renewable energy. At this point electricity exports become an energy grab", commented Pippa Gallop, CEE Bankwatch Network.