Lyubov Nikitina, analyst of electric energy sector of Brokercreditservice IC

– Nizhniy Novgorod NPP has colossal importance for the region

Public hearings on the preliminary environmental impact assessment of the construction and operation of the 1st and 2nd units of Nizhniy Novgorod Nuclear Power Plant took place in Navashino, Nizhniy Novgorod region on Sept 4 2009.

The crisis has revised the plans of the power engineers and has pushed back the problem of energy shortage in Nizhniy Novgorod region. This gap must be used to advantage. The Ministry of Fuel and Energy Complex of Nizhniy Novgorod region says that in 2009 the energy consumption in the region will drop by 5% to 20.784bln KWh, which is quite natural as the prevalent manufacturers of the region – machine building, ferrous metallurgy and chemical industry – are the key victims of the crisis.

However, decline in energy consumption is not a solution to the problem of energy shortage. The construction of Nizhniy Novgorod NPP may enhance the investment appeal of the region. The crisis will pass and the local companies will start picking up steam. And if the energy shortages persist they will come across a serious barrier. Let’s not forget that an NPP construction project lasts for 7–10 years. The cheap energy to be produced by the plant will enhance the competitiveness of the region and will reduce the costs of the local production. One KWh of NPP is cheaper than one KWh produced by thermal and water power plants.

Nizhniy Novgorod NPP has colossal importance for the region. According to preliminary estimates, the Nizhniy Novgorod NPP project will cost 140bln RUR. The plant will stimulate the growth of the whole industry of the region. At the peak of the construction the project will involve as many as 8,000 people (in Feb 2009 there were 19,000 jobless people in the region).

Nizhniy Novgorod NPP is a serial project. A similar project is presently being implemented at Novovoronezh NPP-2. The general designer is Nizhniy Novgorod Atomenergoproekt (part of Atomenergoprom), the owner is Energoatom Concern OJSC (100% subsidiary of Atomenergoprom OJSC).

The plant will have two 1,170MW reactors and will generate over 17bln KWh a year and employ as many as 1,000 people. At the peak time the construction will involve as many as 8,000 people. The 1st reactor is supposed to be launched in 2017. The plant will be situated in Navashino district of Nizhniy Novgorod region.

The analysis of the power and capacity balance in Nizhniy Novgorod region has shown that in 2007 the region was short of 1,800MW while in 2020 it will need as much as 4,000MW.

This is a socially significant project: it will give the region 40bln RUR in profit tax, 50bln RUR in property tax, 1bln RUR in land tax and 50bln RUR in transport tax.