May 11 – May 17, 2020
Belarus-Russia relations

The Belarusian NPP is on the cusp of launching operations

The situation has not changed
The Belarusian NPP is on the cusp of launching operations

By Anatol Pankouski

The Russian general contractor has shifted into high gear to complete the construction of the first power unit of the Belarusian nuclear power plant. Its launch is scheduled for July 2020. Simultaneously, the fundamental issue, what to do with the surplus of electricity after commissioning the NPP, remains open: electricity is not potassium salt which can be stored in a warehouse.

Amid a temporary lull in relations Belarusian-Russian relations, a train carrying nuclear fuel for the first power unit has arrived at the Astravets nuclear power plant construction site from Russia. On May 11th, Deputy Energy Minister Mikhadzyuk said that the nuclear power plant was scheduled to be launched in July 2020. Previously, the launch was postponed several times, in 2018, 2019, and in Q1 2020.

Since the delay with the NPP launch was primarily due to the general contractor’s fault (Atomstroyexport, a daughter of Rosatom) Minsk insisted on amending the terms of the loan agreement with Russia, adding the atomic issue to the extensive list of outstanding issues. Talks about the terms of the loan agreement lasted about two years.

The fact that the contractor has picked up the construction speed to complete the first power unit may indicate that Belarus has made a point. That is, to lower the loan rate, to change the terms of loan use and the pay-off schedule. Currently, scarce information has been disclosed on this account and according to Mikhadzyuk, some information would be for “for official use” only.

The loan agreement with Russia for the construction of a nuclear power plant, as is known, provides for the allocation of up to USD 10 billion (of which 90% is intended for the construction under a general contract, and 10% of the construction cost to be borne by Belarus). As of April 1st, 2020, USD 4.33 billion of the loan were used up. Projected costs of the project, according to Rosatom, would exceed USD 6 billion. Interfax agency, concerning insider information, said that Russia was ready to restructure the loan for the Belarusian NPP construction at USD 600 million.

While things are gradually becoming clear with the commissioning of the Astravets NPP and amendments to the terms of the loan, other related issues remain unresolved. Would electricity become cheaper for consumers in Belarus and if so, by how much? And, most importantly, what to do with electricity surplus? Would neighbors be interested? So far, officials say something along the lines: “everything will normalize over time”, which, however, does not remove these issues from the agenda.

Amid Belarus’ preparations for the NPP launch, and the Belarusian authorities’ policies addressing the pandemic (i.e. the absence of quarantine measures, the Victory Parade on May 9th, etc), Vilnius has stepped up efforts to prompt EU sanctions on the Astravets NPP. The Lithuanian president urged the European Commission to mobilize all possible instruments to ensure that Minsk complied with all “the EU stress test requirements before launching the nuclear power plant”. The Lithuanian authorities also aspire that some states, including Latvia, Estonia, Poland, and Ukraine would sign a political memorandum restricting the import of “unsafe” energy from Belarus.

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Once a week, in coordination with a group of prominent Belarusian analysts, we provide analytical commentaries on the most topical and relevant issues, including the behind-the-scenes processes occurring in Belarus. These commentaries are available in Belarusian, Russian, and English.

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