The government is preparing for a very strong 40 percent increase in the rate paid. nuclear power plants to finance the billion-dollar cost of dismantling all the reactors in seven nuclear graveyards and managing their radioactive waste. Companies owning nuclear power plantsIberdrola, Endesa, Naturgy and EDP– They began to maneuver to postpone the processing of the ascent and gain some time for now.
Foro Nuclear, the employers’ association that brings together the country’s major electricity companies and the nuclear industry, had formally requested from the Ministry of Ecological Transition all the financial and economic information it used to determine this strong increase (well over 25%). (which the industry fears and already sees as a threat to its survival) and has also asked the Government to extend the deadline for submitting claims against the proposed royal decree, which expires on Friday 2 February.
The Ministry of Ecological Transition, led by Vice President Teresa Ribera, accepted the demands of the major electric companies. Last Thursday the Government sent companies the full economic report justifying calculations recommending a 40% increase in rates for nuclear companies, and also extended the deadline for employers to submit their claims and proposals until at least the end of next month. until February 26, as confirmed by various sources familiar with the situation from the Ibérica Prensa Group to El Periódico de España.
The Nuclear Forum had specifically requested the Ecological Transition paralyzing the time for submission of claims until all financial information is obtained Once they have all this data, they can flesh out the details and extend deadlines, which results in postponing the start of the ramp-up, thus giving them time to negotiate other alternatives that don’t add a million-dollar additional burden to their business’s operating costs. plants. nuclear. The extension allowed by the government only applies to interested parties who specifically request more time, with the rest retaining time until February 2, the deadline for claims.
180M extra load per year
The executive has activated the process to approve an increase in the rate paid by electricity companies to 11.14 euros per megawatt hour (MWh) of electricity produced by nuclear power plants; This rate is 39.6% above the currently applied rate of 7.98 euros per MWh. Nuclear power plants pay a non-tax capital allowance, the correct name for this tax, to the National Radioactive Waste Company (Enresa) based on the electricity each produces.
In total, depending on the final volume of annual electricity, the electric companies that own the nuclear power plants (Mainly Endesa and Iberdrola, with remaining participations in Naturgy and EDP) currently pays an average of around 450 million euros a year to the fund where the accumulated radioactive waste plan of around 7.4 billion is financed.
The increase proposed by the government will trigger the annual payments made by nuclear power plants.Close to 630 million euros, another 180 million euros than existing subscriptions. A very strong increase that threatens to lead to a direct conflict between the Administration and the major electric companies, which have been complaining for years that excessive taxes imposed by nuclear power plants are jeopardizing their economic sustainability.
Nuclear Forum admits nuclear power plants are currently profitable due to the increase in electricity prices. An old financial report ordered by nuclear companies from consulting firm PWC reveals that the profitability threshold was reached with an electricity price of around 60 euros per megawatt hour (MWh) on average. According to sources in the sector, in recent years the entire production of nuclear power plants has been sold for 65 euros by large electricity companies.
Companies in the nuclear sector have complained about profitability problems in recent years due to the tax burdens and property rights assumed by power plants, with a cost of approximately 25 Euros per MWh of electricity produced (with this rate increasing). the amount offered is now expected to rise to 28 euros per MWh). Their usual complaints to the administrations include the reduction of tax liabilities and, more recently, the implementation of certain formulas that guarantee a reasonable profitability for the facilities.
Government’s nuclear plan
The increase in the rate prepared by the government is a result of the new General Plan for Radioactive Waste (PGRR), which was approved by the Cabinet two weeks ago and is a new roadmap for the closure and dismantling of nuclear facilities for the coming decades. managing the waste left behind by power plants and determining the billion-dollar cost of all this and how it will be financed.
The final version of the new PGRR confirms the gradual closure of all Spanish nuclear power plants until complete blackout between 2027 and 2035 (a program agreed by the electricity companies and Enresa in 2019); In Spain, he envisions the construction of seven radioactive waste repositories, one at each facility, where they will be stored temporarily for fifty years; Future construction of a huge warehouse for the year 2073; and calculates a total bill of over €3.7 billion in extra costs compared to previous versions of the programme.
Companies in the nuclear sector rebelled against the new plan and openly complained about all these aspects. The Nuclear Forum employers’ association publicly advocates keeping nuclear power plants running and postponing planned closures, denying that the billions of dollars of extra costs are being financed by the power companies themselves through the rate they pay for the plants’ electricity production. This is a result of the lack of institutional consensus on where to locate a central warehouse (no autonomous community wants to host it) and the Administrator’s decision to paralyze the single silo project in the Cuenca town of Villar de Cañas.
According to the newly updated total investment table of the seventh PGRR, currently approved, the cost of the entire radioactive waste management program (from 1985 to 2100) together with the construction of seven repositories will amount to almost 28,156 million euros. The last provisional version of the plan, made public last year, projected that the investments of the entire plan would be 24,436 million (3,720 million less) if only one ATC was built, and 26,560 million with the option of seven ATDs (only 1,595 million difference). over a year due to the impact of inflation and some upwardly revised costs).
The new road map predicts that the cost to be paid by the end of this century will reach approximately 20 billion 220 million euros. During the administrative process of the General Radioactive Waste Plan, major electricity companies proposed that the extra costs envisaged in the new road map should not be borne by the companies, but should be considered as another cost of the electricity system and therefore be billed to the public. Electricity bill to all consumers.
Polluter pays
Under the ‘polluter pays’ principle, the government plan’s billion-dollar investments must be covered by fees paid by nuclear power plants to finance the management of their radioactive waste and the dismantling of the plants. The capital benefit paid by nuclear power plants is not in any case a tax figure, but rather an additional operating cost of the facilities themselves (bearing the costs of managing the nuclear waste they produce) and is expressed as: Enresa.
In other countries, energy companies are taking on multibillion-dollar provisions to directly manage their waste after the closure of their reactors. The Spanish model implies that a state-owned company takes over the work of dismantling the plants and managing the waste. In addition to waste, there is also risk in undertaking these tasks.
In 2019, the Government reached an agreement with major electricity companies to phase out all nuclear power plants between 2027 and 2035. The protocol signed by Iberdrola, Endesa, Naturgy, EDP and public company Enresa foresees the gradual closure of seven Spanish reactors, with Almaraz I in 2027, Almaraz II in 2028, Ascó I in 2030, Cofrentes’ It states that in will close in 2030, Ascó II in 2032, and Vandellós II and Trillo in 2035. Nuclear companies assume that changing these dates would require agreement on a new date. Protocol proposing a new way forward and new deadlines against nuclear disruption.