Very ambitious plans have emerged in Estonia: the local company Fermi Energia has announced its readiness to submit an official application for the construction of a nuclear power plant. Why does the country need exactly nuclear power, will it be possible to implement such an expensive, daring and dangerous project – and how are political frictions between Estonia and Russia connected with all this?
In less than three years of its existence, the Estonian company Fermi Energia OÜ has achieved considerable results.
In October 2019, it signed an agreement with the American GE Hitachi Nuclear Energy on the possibility of deploying a small modular reactor BWRX-300 manufactured by this company in Estonia. She brought in the Finnish energy companies Vattenfall and Fortum and the Belgian engineering company Tractebel in her initiative. Estonian private investors and the American venture fund Last Energy VC financed preparatory activities for the project worth 560 thousand euros. This allowed the initiators to enter the stage of submitting to the government of the country the so-called petition for a special layout required for power facilities with a capacity of more than 150 megawatts (MW). Fermi Energia plans to submit this application during the current year.
The official Fermi Energia portal says that the possibility of using nuclear energy began to be seriously considered in Estonia in 2006, when the prime ministers of the three Baltic states signed a joint statement in support of the construction of a new nuclear power plant in Lithuania. We are talking about the Visaginas nuclear power plant project near the border of Lithuania with Latvia and Belarus, which was supposed to replace the Ignalina nuclear power plant built in Soviet times.
The latter was stopped in 2009 – mainly for political reasons, since the closure of the Ignalina nuclear power plant was one of the conditions for Lithuania’s accession to the European Union. At the same time, a competition was announced for the construction of the Visaginas NPP. But after the people of Lithuania voted by a majority vote in a referendum against the nuclear power plant in 2012, the idea died.
Shale dead end
Meanwhile, the Estonian energy sector had its own problems. The European Union’s Industrial Emissions Directive, adopted in 2010, actually launched a countdown for the Narva Power Plants (NPP) complex operating on oil shale, built in the Estonian SSR in the 1960s and 70s and providing almost all of the country’s energy generation. As part of the European policy to decarbonize the economy, this type of fuel has actually come under absolute suspicion, and the ever-increasing tariffs on carbon emissions have become a way of replacing it.
Actually, this is what the initiators of the construction of nuclear power plants in Estonia are pushing against: a year ago, in an interview with Postimees, the chairman of the board of Fermi Energia, Sandor Liive, said that the generation of electricity from oil shale in Estonia is practically doomed, since compensations for carbon dioxide emissions have already reached prohibitive values (25 euros per ton).
According to Estonian statistics, the production of electricity from oil shale is rapidly declining – in 2019 alone, its share in the total electricity generation in the country fell from 76% to 57%.
But Estonia is not able to compensate for the shortfall in volumes from renewable sources, so it has to increase its imports of electricity. In the same 2019, electricity supplies from the Scandinavian countries increased by 40%, while Estonian electricity exports fell by half. Nuclear energy proponents argue that the emergence of a nuclear power plant will solve this problem, since it will be able to provide 20-25% of the country’s electricity demand, depending on the time of day.
In addition, the nuclear power plant will be able to provide uninterrupted energy supply – in contrast to renewable energy sources, which periodically become a source of serious problems for Estonia. For example, last November due to low production of wind turbines and problems with imports from Scandinavia, the cost of electricity in Estonia at the moment jumped more than a hundred times – from 1.5 to 150-200 euros per megawatt-hour.
But Estonia is fundamentally refusing to buy cheap electricity from Russia, despite the nine network jumpers at the border. Last year, President Kersti Kaljulaid, in connection with the synchronization of the Baltic countries’ power grids with the European Union, said that this automatically implies a long-term decision not to purchase electricity directly from the Russian market.
For its part, the European Union has already offered Estonia a “compensation” for a complete abandonment of the oil shale industry in the amount of 125 million euros – this sector brings about the same amount of direct and indirect taxes to the country per year. But this money will clearly not be enough to create a generation alternative to shale. The NPP construction project is estimated at almost an order of magnitude more expensive, at about a billion euros.
Peaceful atom of the day after tomorrow
One of the key arguments of the proponents of nuclear energy in Estonia is that in recent years, nuclear power plant construction technologies have changed a lot and do not necessarily imply traditional large projects with a capacity of at least 1000 MW. Fermi Energia’s proposal is to implement a new generation nuclear power plant project in Estonia based on small modular reactors licensed in Canada and the USA with a capacity of up to 300 MW.
The Estonian company refers to the experience of neighboring Finland, where developments in the field of mini-nuclear power plants are in full swing. Last year, for example, the Finnish technical research center VTT in Finland started a project to develop a small modular reactor for district heating, based on the same challenges facing Estonia. By 2029, Finland intends to completely abandon the use of coal in energy production, and may be replaced by a “peaceful atom”. Finnish endeavors have already received support from the European Union, where the European Licensing of Small Modular Reactors (ELSMOR) was launched in 2019.
Obviously, keeping in mind the fiasco of the atomic project in Lithuania, now Fermi Energia is also striving to enlist the maximum support of the Estonian society. According to a recent poll commissioned by the company, 54% of respondents “support or rather support” the idea of building a small modular nuclear reactor. However, the survey also showed that so far Estonians consider the use of solar and wind sources as the most optimal way to generate electricity after the abandonment of oil shale. This point of view is shared by 60% and 57% of respondents, respectively, and nuclear power is the number one priority only for 38% of those surveyed. As the main negative aspects associated with nuclear power plants, Estonians named the problems associated with the storage of nuclear waste (65%), the risk of an accident (52%) and the lack of relevant experience in the country (40%).
“We need to be even more active in explaining what a mini-reactor is, which ones and why we consider suitable for Estonia. There are many myths associated with nuclear power that need to be clarified by experts. The most painful issue for people is the issue of storing spent fuel, on which we worked a lot in 2020 – we will present the results of this work in the coming weeks, ”Kalev Kallemets commented on the research results.
In parallel, Fermi Energia is working to select the location of the future nuclear power plant. The surroundings of the town of Kunda in northern Estonia, where there are soils with suitable stability, have already been named as the most suitable location. But even if the local authorities and residents agree on the proximity to the nuclear power plant, and the money is collected, this does not mean at all that the plant will be built quickly.
If Fermi Energia does submit a project application to the Estonian government this year, then only the special design process will take four to five years. It is expected that during this period the technologies for the construction of low-power nuclear power plants (SNPPs), which are now making only their first steps, will also “mature”. By the way, Russia is one of the pioneers in this segment – in May last year, the world’s only floating nuclear power plant Akademik Lomonosov was put into commercial operation, and since 2019 Rosatom has been implementing the project of the first ground-based nuclear power plant.
But since Estonia does not intend to turn to Russian developments, the question arises of how reliable and effective solutions will be offered by alternative (for example, American) technology providers and how soon this will happen. In a word, the project of the Estonian mini-nuclear power plant can only be called potential, and its initiators themselves do not hide the fact that it will be implemented at best in the early 2030s.
Based on the current realities, the construction of a nuclear power plant in Estonia is unlikely to come true, says Leonid Khazanov, an independent industrial expert, Ph.D. The main factor playing against this project, in his opinion, is the weakness of the country’s economy:
“Estonia will not be able to finance such an expensive pleasure from its own funds, and the EU funding is not guaranteed. And even if the Estonian authorities find funds, they will not pay off soon and will be reimbursed at the expense of ordinary citizens who are unlikely to like it. Further, there is a danger of an environmental catastrophe during the operation of the nuclear power plant and storage of its radioactive waste. Estonia is a small country, a suitable place for this may simply not be found, and the task of sinking waste deep into the bowels is technically very difficult. ”
By and large, Estonia has no alternative to oil shale, Leonid Khazanov is sure. All potential options for replacing shale, the expert points out, contain too many “buts”. For example, if Estonia wants to develop gas-fired energy, it will face serious costs, and besides, the nearest source of gas is Russia, unacceptable for political reasons. A similar situation will arise in the case of nuclear power plants: Estonia will have to purchase nuclear fuel – thus it risks becoming dependent on a small circle of suppliers, among which Russia is also the closest. You don’t have to rely on renewable energy either: there are not so many places in the country with constant winds of the required strength, and the sun does not shine constantly.
So so far, the only economically viable option for Estonia after the refusal of generation based on oil shale, Khazanov summarizes, looks like the purchase of electricity in Belarus or Russia.
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