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Briefing on Pyhäjoki nuclear power plant

Jehki Härkönen/Greenpeace Nordic, 18th of January 2012

Pyhäjoki nuclear power plant in short

Project owned by E.ON led (34% share) consort called Fennovoima. Other owners include communal power companies (36.3% share) and industrial and services companies (29.7%). Possible builders French Areva with EPR or Kerena and Toshiba-Westinghouse with ABWR. Bids to be handed in during January 2012, decision on builder to be made latest in January 2013.

New NPP is supposed to achieve grid connection in 2020. This schedule assumed reactor contract in late 2011. This means the project is currently delayed a bit over a year. Political permission for project granted by the parliament in July 2010 with a five years time limit to start construction. Consort still has to apply for a more technical construction permit.

Construction is supposed to happen on a conserved cape in Northern Finland. The municipality has voted for the project but parts of the area owned by local resistance movement. The Petitions Committee of the European Parliament is still investigating whether project is in violation of EU legislation.

NPP with either reactor designs expected to cost a maximum of six billion euros total while international estimates are around eight billions. Project heavily based on Finnish tax exemptions for energy producers (Mankala principle). There are no plans about final disposal of high level nuclear waste.

Ample renewable and efficiency alternatives exist.

Overview of the Pyhäjoki NPP consort

The consort behind the Pyhäjoki Nuclear Power Plant is formed by 70 different companies with E.ON being the largest owner. E.ON owns 34% of the company, while the next biggest shareholder is the steel manufacturer Outokumpu with 9.24% and most owners carrying less than 3% share1. E.ON also has three out of nine votes in the board of directors

E.ON is the only company with significant monetary reserves and any prior knowledge of nuclear projects.

The already existing industry owned nuclear power company TVO has a similar structure but a large part of its ownership is in the hands of the forest industry3. Fennovoima is an alliance of E.ON

and the industries that haven’t been able to obtain a share in TVO’s power plants, namely steel, mining and large services (grocery and foodstuff).

Fennovoima exists solely to build a nuclear power plant in Pyhäjoki.

Reactor types

According to the permission-in-principle, the Pyhäjoki NPP consort may only choose between three reactors: Kerena and EPR by Areva and ABWR by Toshiba-Westinghouse4.

Kerena is a 1250 MW boiling water reactor by the French nuclear group Areva5. It was likely added to the application in case the consort would have obtained permission for a project large enough for two reactors. As the final permission is only for a maximum of 1800 MW of electricity production, the consort is unlikely to pick Kerena. Kerena has never been built anywhere.

European Pressurised Reactor (EPR) is a pressurised water reactor already under construction in Finland by Areva. The model offered to E.ON would be 1700 MW6. EPR has been plagued by delays and cost increases in all three countries where it is under construction (Finland, France, and China). Latest cost estimate for Olkiluoto 3 project is at 6.6 billion euros not including any profit margin for the builder7.

Advanced Boiling Water Reactor (ABWR) is offered to Finland by the Japanese Toshiba- Westinghouse. The model offered to Finland has 1600 MW capacity. Several ABWRs have been built in Japan by Toshiba and GE-Hitachi but none outside Japan. The Japanese models also have the maximum capacity of 1380 MW, being a lot smaller compared to the Finnish project8. The design would most likely be radically altered to achieve increased capacity.

The bids for all reactors should be sent in before end of January 2012. The consort says it will decide on the supplier latest in 20139. According to the decision in principle, the project was supposed to be completed in 2020, with the contract with the supplier being signed in 2011. This means the project is already at least a year late before it has even started.

Political process

After the Chernobyl nuclear catastrophe, Finland introduced a three stage approval process for new nuclear power plants. A nuclear power plant must first obtain a decision-in-principal from the parliament, then a construction permit from the government and finally an operating permit from the government10.

The Pyhäjoki NPP obtained decision-in-principle in July 2010, with all political parties splitting in the vote except the Greens (unanimously against). The process is mostly political but the parliament is supposed to consider the domestic need of energy and the production of an NPP should not go predominantly to exports. To this end, forecasts of power consumption were greatly exaggerated during the licensing process to “fit in” the NPPs.

In the 2008 governmental climate & energy strategy, the business-as-usual (BAU) scenario estimates the power consumption to peak at 103 TWh/a in 2020 and the official target was as 98 TWh/a in 202011. When preparing the proposal for the parliament, the government dropped its efficiency target altogether and adopted a new BAU of 110 TWh/a in 2020 without any new research information12.

Acoording to the decision in principle, the consort now has until July 2015 to provide all contracts assuring the technical and financial feasibility of the project after which it can apply for the construction permit. The construction permit itself is supposed to be only a political process by the government. If the construction permit is not applied for, the decision-in-principle will become obsolete. The operating permit has to be applied for before the NPP can be started. It’s mainly a final safety check-up.

Local situation in Pyhäjoki

The municipality of Pyhäjoki is split in opinions about the NPP. According to a poll conducted by the consort itself as part of its PR campaign, 60% of people are in favour while 40% are against13. There is an active resistance movement Pro Hanhikivi which also has its own group in the municipal council.

The NPP has been approved by the municipal council. Part of the regional land use plans are being contested in the administrative court by Pro Hanhikivi and the petitions committee of European Parliament is also looking into some of them15.

The actual supposed building site is a historical natural conservancy area which includes a massive stone (Hanhikivi, “Goose Stone”) marking the border of 1323 between Novgorod and Sweden. The BAU in 2009: _TEM_EOS_10.11.2009.pdf new BAU in 2010: (both files only in Finnish)

13 asukkaista-haluaa-fennovoiman (available only in Finnish)

14 15 (available only in Finnish)

peninsula has a rare ecosystem, having emerged slowly from the sea and contains a number of endangered plant and bird species. A part of it is also part of the Natura 2000 network.

Financing of the Pyhäjoki NPP

In the decision in principle application, the consort estimated the total cost of the project to be 4-6 billion euros. According to international estimates, the cost of new nuclear reactors of similar size would be around eight billion euros17 which also supported by the price tag of at least 6.6 billion euros for Olkiluoto 3 not including any profit margin for the supplier.

The only shareholder of the project with significant capital assets is E.ON. It’s likely that the consort has asked the suppliers to provide financing as part of their bids. E.ON has also been checking for a possibility of an investment guarantee from the German export credit agency

France has previously provided export guarantee for the Olkiluoto 3 project by TVO19. The question might more controversial in Japan after the Fukushima nuclear catastrophe.

No solution for disposal of nuclear waste

The Pyhäjoki consort is not part of the nuclear waste company Posiva that aims to build a deep geological disposal site in Olkiluoto. So far the consort has refused to look into alternative options and instead asked the government to enforce its access to the Posiva project20.

According to the decision in principle, the consort is not expected to come up with a solution of dealing with the high level to apply for a construction permit.

Local alternatives for nuclear power plant

Finland has a lot of opportunities to improve energy efficiency especially concerning heating of houses. Finland also jumped the renewable train late, introducing feed-in tariffs only in 2011. There are still a lot of opportunities with different kinds of renewable energy production21.

The Gulf of Bothnia where the new NPP would be built, is a region with high potential of wind power for example. On the Swedish side of the gulf, the commune of Piteå is building a large wind farm alone capable of producing as much electricity as a nuclear power plant.,1518,804038,00.html anies/1135269639490

Greenpeace energy scenario for Finland: (available only in Finnish)

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