— Nuclear power sector reforms will lead to power tariff reduction

Russian MP, member of the State Duma Committee on Ecology Mikhail Zalikhanov has commended on the bill “On the Peculiarities of the Nuclear Power Sector Management” – a document suggesting nuclear power sector reforms. Zalikhanov says that it has become obvious that today Russia’s nuclear power industry cannot rival with such transnational companies as AREVA, URENCO, Westinghouse, Toshiba unless it is drastically reformed and vertically integrated into a single nuclear power production chain – from uranium extraction to electricity generation. “This chain should comprise the whole technology of nuclear fuel cycle, including nuclear machine building.”

As reported earlier, the first reading of the bill was approved on Dec 6. The document allows legal entities to manage nuclear power facilities and materials. The bill suggests dividing the nuclear power complex into industrial and defense sectors, corporizing federal state unitary enterprises (FSUE) of the civil sector and vertically integrating them into a united 100% state-owned JSC. The authorized capital of this company will comprise the shares of the JSCS of the nuclear power sector, the assets of the FSUE and federal state institutions.

Correspondent: Why is it necessary to adopt the bill right now?

In the nuclear power industry the business legal structure of unitary enterprise does not meet the requirements of the market economy. Over half of the nuclear power enterprises exists in the form of JSCs. Consequently, the Government cannot conduct single strategy, single technical and investment policy.

In this light, the bill suggests establishing a head company – Main Joint Stock Company – which will be fully owned by the state. The list of the enterprises comprising the civil sector of the Company will be approved by the President.
 
The gist of this “tunnel bill” is that it should ensure peaceful nuclear power production on condition that not only the sale but any other actions leading to nuclear asset alienation (leasing,  ) will be possible only if approved by the President.
 
Today the nuclear power complex is disintegrated and the only way to change this abnormal situation is to form a united vertically integrated state JSC.

The bill presents the only possible opportunity for the Government to bring the nuclear power industry together leaving the nuclear defense complex on the basis of FSUE.

Correspondent: What obstacles will the bill remove?

Vertical integration will allow the Government to regulate the tariff policy, which will lead to electricity tariff reduction.
The bill is aimed at changing the business structure of the nuclear power sector in line with the economic interests of the state and the modern economic conditions. There is one more important aspect: the bill should be in harmony with the RAO UES projects. The bill does not cover the enterprises of the nuclear arms complex. This structure is determined by the President. The bill specifies the order of structural reforms in the nuclear power industry. At the same time, the shares of the Main JSC will belong to the state and can be managed exclusively in line with the federal law.

Correspondent: The information about corporization of the sector was followed by reports about privatization of NPPs. Could you comment on them?

These are just rumors. The objective of the bill is to bring the nuclear power industry back into the hands of the state.

The top level state control over the nuclear materials production and spending will guarantee that no unsanctioned  outflow of such materials will take place. The bill suggests state control over nuclear materials and their recording irrespective of the form of ownership. It is also necessary not to lose tailings and dumps during spent nuclear fuel processing.  

Correspondent: Can the bill attract new investments in the sector?

The growth of investments in the nuclear power sector is planned by the Federal Target Program. Particularly, 1 trillion 400 billion RUR will be allocated for the sector under the program. It is early to make forecasts but I think that the bill will ensure positive results in the sector.

 REGNUM