Rosatom excluded from Dukovany tender

22 April 2021

Czech Trade and Industry Minister Karel Havlicek told Pravo newspaper on 19 April that Russia’s Rosatom would be excluded “within a few days” from the candidate companies selected to take part in the tender to build a new unit at the Dukovany NPP. "None of the companies invited will use a subcontractor from Rosatom," he said. The previous day Czech Prime Minister Andrei Babis had spoken in favour of removing Rosatom from the tender based on Czech intelligence reports that explosions at an ammunition depot in the village of Vrbetice in 2014 had involved Russian special services.

This came just a week after questionnaires were sent to four potential bidders for the completion of the Dukovany NPP - Rosatom, US-based Westinghouse, Korea Hydro and Nuclear Power and France’s EDF. China had earlier been excluded from the tender following intense pressure from Czech security services and right-wing opposition parties to exclude both China and Russia. Havelik had at that time argued for Russia to remain in the tender to increase competition. In late March, at his suggestion, the government had agreed to include Rosatom in the competition, which would be announced after parliamentary elections in October. The Dukovany contract is estimated at approximately €6 billion ($7.2bn).

Czech company Elektrárna Dukovany II, part of the CEZ Group, earlier in March obtained a permit from the State Office for Nuclear Safety (SÚJB) to site a new nuclear power plant in Dukovany. The preparation and processing of documentation for the licensing procedure took five years and included over 200 professional studies and analyses, CEZ noted. The licence relates to the siting of of two nuclear units, each with a pressurised water reactor with a maximum electrical output of up to 1200 MWe. 

The Czech Republic’s six nuclear reactors generate about one-third of its electricity. These comprise four VVER-440 units at Dukovany and two VVER-1000 units are at Temelín. The country is phasing out its coal-fired power plants and will need to increase the share of nuclear power if it is to remain self-sufficient in electricity supply. The government's long-term energy strategy, adopted in 2015, sees the share of nuclear power in the electricity mix increasing by 20-25% to 50-55% by 2050. CEZ has said it expects to operate the four Dukovany units until 2045 and 2047, and the two Temelín units until 2060 and 2062.

Rosatom said on 19 April that it “has always been a strong supporter of fair market competition, which ensures that the customer receives the best possible technological solution at the most attractive price”.

Its exclusion from the Dukovany tender “is an anti-market, politically motivated decision that does not encourage the development of mutually beneficial cooperation between our countries”. Rosatom noted that, in the past 65 years of collaboration in the nuclear industry, “together with our Czech partners we built six NPP units”, while Czech companies received unique expertise in both manufacturing components and equipment for VVER reactors and supplying them to Rosatom facilities across the world. “We regret this decision of the Czech authorities, because the Russian and Czech nuclear industries had serious prospects for the development of a mutually beneficial partnership, not only in the Czech Republic, but through joint work in third countries as well.” Rosatom added that nuclear energy relations should be outside of politics.

The Vrbetice revelations, six years after the event, took place in the context of rapidly deteriorating US-Russian relations, including the imposition of American sanctions on Moscow for alleged cyber attacks. Subsequently the Czech Republic on 17 April expelled 18 Russian diplomats alleging that they were members of Russia’s security services, while Russia in turn expelled 20 Czech diplomats.

On 19 April, the Czech authorities disclosed that damages caused by the Vrbetice explosions exceed $47 million, which includes the property destroyed in the warehouses, as well as operations for the subsequent removal of unexploded ordnance as well as compensation to the families of two people killed in the explosions. On 20 April, Prime Minister Babis said the Ministry of Finance was preparing a lawsuit demanding compensation of damages from those believed to be responsible. Earlier an arrest warrant was issued for Alexander Petrov and Ruslan Boshirov, the two Russians accused by the UK of involvement in the 2018 poisoning of Sergey Skripal. Czech security services said they may also be involved in the Vrbetice incident.

Babis said on 19 April that the Vrbetice incident “was not an act of state terrorism”. The attack was not targeted at the Czech Republic but at a shipment, intended for a Bulgarian arms dealer who, probably, intended to resell it either in Syria or Ukraine. However, the report of the Czech Security Information Service (counterintelligence service - BIS) on the incident will not be published out of national security concerns, Babis told journalists, although the previous day he had said the report would be declassified and made public.

The Kremlin “categorically denies” the Czech allegations, said the press secretary of the Russian President Dmitry Peskov. Russian Foreign Ministry spokeswoman Maria Zakharova noted that controversial issues between countries are usually resolved through existing bilateral and diplomatic mechanisms. She recalled that after the Vrbetica explosion, the Czech authorities "were unable to offer any version of what happened for seven years”. She added: “Literally in a couple of days, right after a massive attack by the West - the expulsion of Russian diplomats from the USA and Poland, statements about interfere in their internal affairs - Prague issued this version.” However, this included so many fake allegations and lies “we have not seen such absurdity for a long time”. Leonid Slutsky, Chairman of Russia’s State Duma Committee on International Affairs, believes that the Czech Republic is following “the Russophobic policy of the United States”.

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