Czech government approves financing model for new Dukovany unit

23 July 2020

The Czech government has approved a model for financing a new nuclear unit at Dukovany nuclear plant, according to local press reports on 20 July. The state should provide a loan for a new nuclear unit in Dukovany, without interest during construction.

"This ensures an affordable price of electricity and strengthens energy self-sufficiency," said Minister of Industry Karel Havlícek on Twitter.

The loan from the energy company CEZ should cover 70% of the construction. The rest should be paid by CEZ, which will also cover all possible additional costs.

After a year of preparation, a comment procedure and a discussion with the opposition, the government finally adopted a framework and implementation agreement between the Czech Republic and CEZ, as well as a model for financing the Dukovany unit. The new unit in Dukovany will be interest-free during construction, and the government expects interest at 2% during operation.

In May, CEZ CEO Daniel Benes said that the expected amount for the construction of the unit at current prices is about €6 billion ($6.9 billion). The fifth nuclear unit at Dukovany should start construction in 2029, with commissioning expected in 2036. The government also plans to buy power from the roughly 1200MW reactor at a price determined from agreed construction costs to give CEZ enough security. The plan needs to win approval from the European Commission to ensure it meets EU state aid rules.

Six companies have expressed interest in building new nuclear units in the Czech Republic - China General Nuclear, EDF, Korea Hydro & Nuclear Power, Rosatom, Westinghouse, and the Atmea consortium of Mitsubishi Heavy Industries and EDF. A supplier should be selected by 2022.

Dukovany is the oldest of the two Czech nuclear plants. Its four power units have a total capacity of 2040MW and were commissioned in 1985-1987. Nuclear power accounts for around 35% of Czech Republic's electricity generation.

Photo: Dukovany nuclear plant

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