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BULGARIA

(updated on Dec. 2004¹)

1.  ENERGY, ECONOMIC AND ELECTRICITY INFORMATION

1.1.  General Overview

Bulgaria is a country situated in the south-eastern Europe and it occupies the biggest part of the Balkan peninsula. The northern border of Bulgaria continues for 470 km on the Danube River and later in south-eastern direction to the Black Sea for about 139 km on land. In eastern direction, Bulgaria borders the Black Sea while to the south there is a 752-km long border with Turkey and Greece. To the west, the country has a border with the Former Yugoslav Republic of Macedonia and Yugoslavia. Within these borders, Bulgaria has 110 975-km² surface, including an altitude correction.

The demographic situation in the country is characterised with a clear tendency of decrease in the population (Table 1). For the period between 1985 and 1998, the population has decreased by 719,509 people (8.0%). At the end of 1994, the population of the country numbered 8.43 million people and population density of 76 persons per square kilometre. There exists a negative trend in the change of the population, which was for 1990 -0.4%; for 1991 -1.7%; for 1992 -2.2%; and for 1993 -2.9%; see Figure 1, which shows the birth and death rates from 1992 to 2001. According to the National Institute of Statistics, the total number of the population is expected to decrease by another 320,000 (319,392) people around the year 2000, compared to 1993 (Table 2).

TABLE 1. POPULATION INFORMATION

Bulgaria has four distinct seasons, which create changes in the demand for energy and in particular for electricity. The annual fluctuation of Bulgarian's electric power demand has one peak period in winter, which has been identified to be the result from using electricity for space heating. The average temperature of 12°C, below which space heating is necessary, lasts about 200 days. The average temperature in November is 5.1°C, in December - 0.0°C, in January -1.8°C, in February -0.3°C, in March 4.6°C.

TABLE 2. POPULATION OF BULGARIA (1993 - 2003)

1.1.1.  Economic Indicators

Table 3 shows the historical Gross Domestic Product (GDP) data from the IAEA Energy and Economic Database (EEDB) in USD. GDP in 1998 was 21 577 billion levs at current prices, which amounts to 112 325 million levs at 1991 prices. The economic crisis of 1996 and 1997 led to a decline in real GDP, which dropped by -10.1% and -7.0% respectively. The economy picked up again in 1998, with real growth estimated at 3.5% and remained on that level. Figure 3 shows the real GDP index for 1990 through 2006, where 1990 was taken as the base year.

TABLE 3. GROSS DOMESTIC PRODUCT (GDP)

Source: World Bank World Development Indicator

1.1.2.  Energy Situation

Current status

Bulgaria has very few domestic energy resources. Data in Table 4 indicate the national provision with domestic primary energy source. Proven oil and gas reserves for the country have declined for a number or years and are only about 5 million tons of oil equivalents. In fact, it is less than six months normal hydrocarbon consumption for Bulgaria. Hydropower potential is also limited since most of Bulgaria's rivers are small and the only large river, the Danube, has a small drop in altitude where it forms Bulgaria's northern border with Romania. Largely because of this constraint, hydro capacity accounts for about 17,6% (HPP - 15.1% and PSHPP - 6.5%) of the country's total installed generating capacity and an even smaller percentage of generation. The thermal power is 50.0%, and nuclear power is 28.4% of the country's total installed generating capacity.

TABLE 4. ESTIMATED ENERGY RESERVES

(*) Sources: 20th WEC Survey of Energy Resources, 2004 and Uranium 2005: Resources, Production and Demand ("Red Book")
(1) Coal including Lignite: proved recoverable reserves, the tonnage within the proved amount in place that can be recovered in the future under present and expected local economic conditions with existing available technology
(2) Crude oil and natural gas liquids (Oil Shale, Natural Bitumen and Extra-Heavy Oil are not included): proved recoverable reserves, the quantity within the proved amount in place that can be recovered in the future under present and expected local economic conditions with existing available technology
(3) Natural gas: proved recoverable reserves, the volume within the proved amount in place that can be recovered in the future under present and expected local economic conditions with existing available technology
(4) Reasonably Assured Resources (RAR) under < USD 130/kgU
(5) Hydropower: technically exploitable capability, the amount of the gross theoretical capability that can be exploited within the limits of current technology
Source: IAEA Energy and Economic Database.

TABLE 4.1. ENERGY INDEPENDENCE OF THE COUNTRY

The country has significant but very low-grade coal reserves (Table 5). The mineable reserve amount to about 2.2 billion tons including lignite, of which 2.1 billion tons are situated in the Maritsa East deposit. The production in 2001 amounted to about 27.3 million ton per year (Table 6 and Figure 4). About 90% of these reserves have a heating value of about 1500-1600 kcal/kg, which is 20-25% of the heating value of internationally traded, steam coal. In addition, these lignite reserves have very high sulphur content. Consumption of coal in Bulgaria reached its historically highest level in 1987. In that year, 40.5 million tons of coals were consumed.

Bulgaria imports almost all of its petroleum since domestic production is negligible, for example in 1997 domestic production was 27.800 tons of oil and 35 million cubic meters of gas. Imported petroleum is in the form of crude oil and is being refined in Bulgaria or directly imported as products. Typically, about 90% of petroleum are imported as crude and most of the rest is imported as heavy fuel oil. Bulgaria has three refineries located respectively at Burgas, on the Black Sea Coast, and at Pleven and Ruse on the Danube plain in the northern part of the country. The Burgas refinery accounts for about 85% of the country refining capacity with the other two refineries being very small with insertion economics.

TABLE 5. BULGARIA COAL RESERVES

TABLE 6. STRUCTURE OF THE COAL PRODUCTION IN BULGARIA (IN THOUSAND TONS)

The average annual consumption of natural gas for the past five years (1997-2001) was around 3.5 bcm, which represents a considerable decrease compared to the highest demand in the country in 1989 and 1990 (6.8 bcm). The reduction of the share of natural gas in the structure of primary energy demand, however, is far less (15.3% in 2000 compared to 18.1% in 1990). That is due to the registered total drop of demand for energy resources over the past 10 or 12 years.

In order to fulfil Decree No 162, August 20, 1992, and Decree No 56, March 29, 1994 of the Council of Ministers, the technical liquidation of the uranium mining sites have been completed. The liquidation of the processing plants has been finalised. By 2002, the projects of technical and biological re-cultivation of the uranium mining regions shall be completed, and by 2005 - sanitary treatment and safeguarding of the tailings ponds of the processing plants. Special attention is paid to the regions of Buhovo, Eleshnitza and Sliven, where the damages to the environment are most markedly pronounced, and where their effect on the population is the most direct. In parallel to performance of the re-cultivation and sanitary treatment projects, the required treatment facilities for purification of radionuclide polluted waters and monitoring networks will be built in the uranium mining regions. For performance of the projects in these regions, we depend on the co-operation and assistance of the European Union and the PHARE Programme, especially to avert the danger of cross-border water pollution. A project for engineering works for closing of uranium mines in Eleshnitza and Dospat under PHARE CBC 1999 Bulgaria-Greece programme is under implementation. Two other projects -regional monitoring network for radio-ecological monitoring in Mesta river valley and Smolian and feasibility study for the status of the uranium mines in Southern Bulgaria are going to be implemented under PHARE CBC Bulgaria-Greece programme 2001.

The energy intensity of Bulgarian Gross Domestic Product (GDP) does not appear to have decreased, with energy consumption and output roughly at the same rate. However, this pattern should start to change as the economic restructuring occurs and as relative energy prices continue to increase. Reduction of energy consumption and, therefore, of net energy imports is likely to be an important component of any improvement of Bulgaria's balance of trade. Table 7 shows the national energy data.

TABLE 7. ENERGY STATISTICS

Source: IAEA Energy and Economic Database
 

The pattern of energy use in Bulgaria is significantly different from the West. The main area of difference is in the direct use of gas. In most western industrial countries, households and the service sector use gas. In Bulgaria, gas is almost entirely used in the industrial sector and in power generation, including district heating plants (many plants being combined heat and power or CHP plants), with a negligible amount being used in services and households. Furthermore, this pattern of usage will not change rapidly since Bulgaria lacks a distribution network for gas so that it cannot currently be supplied to most households and commercial establishments. Indirectly, of course, the household and service sectors use some gas since a small part of the electricity they consume and most of the heat supplied by district heating plants, comes from gas. Even considering this indirect use, however, the use of natural gas in Bulgaria is still heavily skewed towards the industrial sector.

1.1.3.  Bulgarian National Energy Development Strategy

The main objectives guiding the energy development are:

• through competitive energy to competitive economy;
• continuous and safe coverage of the national energy needs with minimum public cost;
• providing energy independence for the country;
• reduction in specific energy intensity per GDP unit in economy;
• ecologically oriented development;
• establishment of competitive internal energy market;
• integration of the Bulgarian energy system and energy market with that of the EC;
• maintaining the nuclear safety at the acceptable level;
• utilisation of local renewable energy sources (RES).

However, the establishment of an up-to-date and market-oriented energy sector, calls for a series of prerequisites that have been missing up to this date, namely:

• Normalisation of energy prices in line with the justified full economic costs and phasing out of the subsidies for generators;
• Financial recovering and establishment of energy companies operating on a commercial basis;
• Properly functioning regulatory authorities and mechanisms;
• Market rules and structures;
• Appropriate legal framework.

Concurrent actions should be undertaken, mainly in the following areas:

• financial restructuring: establishment of financially viable commercialised companies;
• institutional changes: enhancement of the role, autonomy and influence of the regulatory body (SERC);
• commercial restructuring: transition from administration to regulation and introduction of clear regulatory rules for the market players;
• deregulation: introduction of clear and sustainable market rules and a clear schedule for the opening of the internal and external market to competition, including delegation to SERC of the powers to enforce market rules;
• legal changes: discussion and adoption of a new energy law which would ensure a legal framework for the successful implementation of the above areas of the reform;
• privatisation: transfer of ownership aiming to attract investments and to bring the management practice in line with up-to-date standards.

The government policy in the area of energy will be based on the following principles:

• Introduction of market relations, based on cost-reflective tariffs and free contracting;
• The active role of the state in the creation of a clear and stable legal and regulatory framework for investments, commercial activity and protection of public interests;
• Creation of a legal, regulatory and market environment prior to the implementation of new large-scale investment and privatisation projects;
• Pro-active energy efficiency policy as a means for improving the competitiveness of the economy, security of energy supply and environmental protection;
• Efficient social protection through shifting government subsidies from the producer to the consumer, through energy efficiency measures and introduction of socially-oriented tariffs;
• Positioning of Bulgaria as a reliable country for the provision of future transit of oil, natural gas and electric power and as a dispatching and market centre in the region.

The government policy in tender procedures will continue the good traditions and will rely on two main sources:

• Nuclear energy and
• Local lignite coal.

TABLE 8. EXPECTED ENERGY CONSUMPTION

TABLE 9. RATIO OF EXPECTED ENERGY CONSUMPTION AND GDP

1.2.  Energy policy

The energy strategy of the Republic of Bulgaria is based on the national priorities and corresponds to the new lasting positive political and economic trends in the country as well as to the requirements of the European guidelines, the principles of market mechanisms and the Government's Programme. It is determined by the requirements for ensuring sustainable economic growth, and raising the living standard. The strategy has been developed in conformity with the natural and geographic factors determining the inherent role of the country in this region, and the optimal mix of energy resources used in accordance with the specific conditions.

The main goals of the Bulgarian energy industry are focused in energy efficiency improvement, development of the national energy system and energy market as a part of UCTE, maintaining of a high level of nuclear safety already achieved and establishment of a competitive domestic energy market.

The Bulgarian energy sector is a stable functioning system within the restructuring and adapting to the market conditions Bulgarian economy. Bulgaria is in possession of production capacities, which at the moment cover a great part of the electric power deficit in the Balkan region and provide for stable, of quality and continual electric power supply for the country. The manner of implementation of the fuel-energy balance is of particular significance for the economy of the country as well as what the technical and economic indicators of the transformation process during the production of the electric and heat power are.

The attained generalised technical and economic indicators of the energy transformation processes during the electric and heat power production outline the establishing tendencies of the energy consumption in the various sectors of the economy of Bulgaria during the past year 2003 and provide for an answer to the question to a what degree the national pursuit for conduct of a policy for energy efficiency results in the anticipated stabilisation and revival of the economic and public sector in our country.

The share of the imported energy resources referred to the general import of raw materials, materials, investment and consumer goods is about 18 %. For year 2003 the import of primary energy resources was about 1,45 times higher than the available primary resources in Bulgaria. The realised import of energy resources from our country is about 8,6 %. It should be underlined that from the commodity import the energy resources in monetary expression add only up to 19,9% for 2003. From these imported energy resources only 35.4 % are used in the energy sector for the production of electric and hear power, the structure of these resources or 7.1% of the commodity import of the country. The share of nuclear fuel is 37.6 % of the imported energy resources used in the energy sector, or 2.6% of the commodity import of the country. The import of energy resources in 2003 is presented below.

The energy sector is a determinative section of the Bulgarian industry, especially taking into account that its structure and development are based predominantly on imported energy sources and the domestic low-quality lignite coal. Moreover, the development of the sector is highly dependent on our geopolitical location on the Balkan Peninsula and in Europe. In this complicated stage of its development, Bulgaria unambiguously proves the willing to conform to the priorities of European Union and make the needed steps for technical and political integration with these structures.

As a country with limited energy resources, the basis of the energy sources of Bulgarian Energy Sector is well balanced - solid fuel, nuclear power, natural gas, hydro resources and utilisation of the new energy sources.

Bearing in mind that the future development of nuclear power is now more a political and societal issue than a purely technical one, Bulgarian strategy are aimed to advise citizens of the possible energy solutions in a dispassionate way, and should seek their involvement in the decision-making process.

Bulgarian energy strategy integrated the technical, political and economic considerations specific to our country and to the region, leading to definition of the preferred solution by the Bulgarian Government, through the normal democratic processes.

The possibility of using nuclear energy to improve security of energy supply and curb greenhouse gas emissions is causing more and more countries to re-evaluate their positions towards the current and potential role of nuclear power. Although the nuclear contribution is often taken for granted, all our "clean energy" options will have to be seriously considered if we are to meet our future energy needs in a way that is both sustainable and climate-friendly.

Electricity is a clean energy carrier, but to a large extent coal, oil and gas are burned to produce it. In the future, the emphasis in the power generation sector will have to be on cleaner production methods, such as wind, solar, biomass, hydro and nuclear energy. This change in emphasis will be needed to meet future electricity demand in a way that is low on greenhouse gas emissions and compatible with sustainable development. Nuclear power also generates electricity with no emission of sulphur dioxide or nitrogen oxides, key agents for acid rain and photochemical air pollution.

Nuclear energy is - and will continue to be - part of the solution to meet our energy needs and to mitigating climate change.

Nuclear power in Bulgaria contributes significantly to meet the need of electric energy of the economy and the population of the country, as well as in the region.

For the last 10 years Kozloduy NPP has been providing 40-47% of the average annual electricity produced in the Republic of Bulgaria.

The national responsibility for the safety of nuclear installation is the fundamental principle. In this context the adequate legislation for the nuclear installations safety and the management of radioactive wastes is primary responsibility of the Republic of Bulgaria and the Government.

The Republic of Bulgaria acknowledges that International Atomic Energy Agency's (IAEA) standards and approaches, as reflected notably in the IAEA Safety Fundamentals and Safety Requirements Series, constitute an internationally recognised framework which national safety requirements use as a reference level.

The important factors for Nuclear Power development as Safety based on proven and verified technologies, Spent Fuel and Waste Management, Proliferation Resistance, Environment Protection, Existing Infrastructure, Human Resources, Political Acceptance and Public Acceptance which are adequately addressed.

The supporting factors for Nuclear Power development are as follows:

• The nuclear electricity cost is lower than for other major alternatives except hydropower, including Spent Fuel and RAW Management Costs and Decommissioning costs;
• Low fuel cost make nuclear electricity costs more stable and less sensitive to swings in fuel prices;
• Any productivity increases translate directly into profit in deregulated electricity market, in contrast to previous market operations under regulation;
• Nuclear fuel price has the advantage of being stable and predictable in the long term;
• Nuclear fuel has the advantage of being a highly concentrated source of energy, cheap and easily transportable;
• In contrast to conventional fuels, transportation, supplies, storage and refuelling take place during the spring-summer period and NF Supply is not weather dependent;
• Nuclear power emits virtually no greenhouse gases;
• Of particular importance is the new Emissions Trading Scheme (ETS) due to start in the enlarged EU on 1st January 2005.

For the last three years Republic of Bulgaria established the new legal basis and adopted completely new Bulgarian primary and secondary nuclear legislation in accordance with the good internationally recognised world-wide practices, and the same principles of containment and safety are applied, in conformity with the international standards and conventions of the IAEA. This heavy work already done is good real basis for the future development of the nuclear sector as an inherent part of Bulgarian energy mix.

1.3.  The Electricity System

1.3.1.  Structure of the Electricity Sector

The structure of the energy sector is shown in Figure 5.

1.3.2.  Decision Making Process

The energy policy of Bulgaria is developed and implemented by the Ministry of Energy and Energy Resources (MEER). The MEER has obligations to propose a strategy of energy development and efficient utilisation of energy and energy resources to be carried by the Council of Ministers and passed with a resolution of the National Assembly. The MEER manages the "Radioactive Waste" Fund and the "Nuclear Facility Decommissioning" Fund.

The State Energy Efficiency Agency is an executive agency to the MEER. It implements the state energy efficiency policy and develops effective measures for the improvement of energy efficiency, and promotion of the utilisation of renewable sources of energy.

State regulation in the field of energy is carried out by the State Energy Regulatory Commission (SERC). The Commission has obligations for developing instruments and take the required steps to issue the permits and licenses provided by the Energy Act. The SERC issues licenses for construction of generation capacities, heat transmission systems, gas transmission systems, natural gas storage facilities, direct power lines and gas pipelines, and for decommissioning of energy facilities. In the process of performing its regulatory functions under the Act, the Commission is guided by several basic principles, as achievement of energy efficiency, environmental protection, etc.

1.3.3.  Main Indicators

In 2003 Bulgaria had a total of 12331 MW installed power generation capacities consisting of:

4740 MW of the TPPs are public utilities, 880 MW are co-generation plants the main purpose of which is heat supply to towns, and 993 MW are co-generation plants belonging to large industrial enterprises.

The available capacity of the existing power generation sources, however, is considerably lower than their installed capacity and amounts to 9515 MW. The main causes of that difference are:

• for economic considerations, the district heating thermal power plants do not operate at their installed electrical power but only at the level corresponding to the heat load in combined electricity and heat generation, which is about 460 MW, or 52% of the 880 MW installed capacity;
• after their privatisation, the existing industrial power plants for combined generation significantly reduced their available capacity due to closing down of inefficient production lines and decrease of the heat load. Thus, of 993 MW installed capacities at large industrial enterprises, presently their available capacity is about 400 MW, or 60% less;
• after analysis of the heat loads of co-generating capacities in district heating and industrial power plants in the country it was found that their share in the power balance will be preserved in the near term as indicated above. If the economic expedience of rehabilitation and energy efficiency measures is proved, their utilisation ratio is expected to improve availability ant to extend their life time;
• HPP and PSHPP participate in covering the maximum load in the system during a moderately humid year with 1800 MW total capacity;
• A part of the installed capacity of the existing units at TPP cannot be reached due to wear of their main and auxiliary facilities. Thus, of 4740 MW installed capacities at large thermal power plants, currently their available capacity is 4155 (or 12.3% less);

Under these circumstances, the available capacity of the existing generating capacities is:

TABLE 10. ELECTRICITY PRODUCTION AND INSTALLED CAPACITY

Source: IAEA Energy and Economic Database  

Electric power production meets the electric power requirements of the country and for export. Electric power output in 2003 was 42,5 TWh and is among the highest in 1990-2003 notwithstanding the disconnection from the grid of 880 MW nuclear capacities in the end of 2002. Kozloduy NPP reached relatively high electricity output during the period considered with most efficient loading of the generating units.

The growth of electric power production after 1999 is due mainly to increased export of electric power. The average annual growth of electric power export in 1999 - 2003 was 20.7%, the relative share of export for 2003 being 15.9% of the gross electric power output in the country. In the same period electric power demand in the country increased by 2,1%.

After the commissioning of Kozloduy NPP, Unit 6 in 1993 the imports gradually decreased and exports increased. As a result of that process, after 1997 Bulgaria became one of the leading exporters of electric power in the region. At the same time domestic demand was reduced and more efficient energy utilisation was achieved.

Forecast

Since 1991, the energy consumption in the Republic of Bulgaria is characterised by large fluctuations determined by the unstable and dynamic social and economic conditions. The prognosis for development of the energy consumption is based on the policy for economical stabilisation and development. The forecast was elaborated according to two scenarios: maximum and minimum, which correspond to the maximum and minimum scenarios of GNP forecast, energy efficiency measures implementation, energy demand, and export capacity in the region. The 2004 forecast, based on the Least Cost Plan developed by the National Electric Company, define the area (green area) of most probable power generation and demand forecast with planned export or technological exchange (Figure 10).

2.  NUCLEAR POWER SITUATION

2.1.  Historical Development and current nuclear power organisational structure

The nuclear development of Bulgaria started after the Geneva conference "Atoms for peace" in 1956 and was the favoured strategy of the political leadership ever since. The first step was the construction and the start of operation of IRT-2000 research reactor and a large programme of isotope applications and scientific research. Later, in 1966, an agreement was signed with the Soviet Union to deliver commercial reactors for electricity production. This agreement laid down the foundations of the Bulgarian nuclear power programme. The main articles of this agreement described the role of the reactor manufacturer and designer as well as the participation of the Bulgarian organisations and industry.

The Soviet nuclear industry was designing and supplying the nuclear island as well as the conventional part of the plants, while the architect engineer of the conventional plant and the auxiliary systems was the Bulgarian Company "Energoproekt". The Soviet safety rules and norms were supposed to be used as long as there was no special Bulgarian legislation available. During the construction and start up period, the Russian representatives at the site adopted the role of supervisors, but later they have only taken the position of manufacturer and supplier representatives. A number of Russian organisations also carried out all of the important assembly operations.

The first two units, which are a typical WWER 440/230 model, were built and put into operation for a period of less than 5 years. The second pair of reactors was completed and connected to the grid in 1980 and 1982 accordingly. By that time, the model 230 developed towards model 213, which is the reason why Units 3 and 4 incorporate many of the safety characteristics of the 213's. The further increase in the demand for electricity resulted in the construction of additional two units of 1000 MW each from the model known as WWER-1000/320. A second site was chosen in the early eighties near the city of Belene. The site was prepared with the entire necessary infrastructure to host six 1000 MW units. Completion of the first unit reached about 40% on view point construction, and 80% on delivery of equipment, in 1990, when due to lack of financial resources and some opposition from the near by communities the construction was frozen.

2.2.  Nuclear Power Plants: Status and Operations

2.2.1.  Status of nuclear power plants

Bulgaria has six nuclear power units in operation at Kozloduy of which operation started between 1974 and 1991 comprising four WWER-440 units, net capacity 408 MW(e) and two WWER-1000 units, net capacity of 953 MW(e), all imported from the former USSR (Table 14).

TABLE 12. STATUS OF NUCLEAR POWER PLANTS

During the 70's, a site for the construction of a second nuclear power plant was selected near the town of Belene. In 1980, the Ministry of Energy started its construction. Initially the construction of 4 units with WWER-1000/V320 reactors was envisaged with a possibility for exceeding this capacity with additional new facilities. The engineering works on the site and the construction of the infrastructure started at the end of the year 1980. The construction of unit 1 started in 1987. In the year 1991, the Belene NPP construction was halted mainly due to lack of funds. At that time the first unit was 40% complete.

In the end of 2002 Bulgarian Government took a decision to perform a feasibility studies for renewing the construction of the second Bulgarian NPP at the Belene site. Up to this moment considerable amount of work has been done for justification of the future activities on this project, including Environmental Impact Assessment Report and Feasibility Studies Report. After public discussion performed in March 2004 it was concluded that the construction of the second NPP in Bulgaria has very strong political and public support at local (more than 97%) and national level (more than 76 %).

In April 2004 Bulgarian Government approved in principal the continuation of the construction activities at Belene site. The decision is based on the conclusion that nuclear energy is the main and most efficient way to meet our future electricity needs. It also provides high reliability of electricity generation with regard to minimisation of the expenditures in energy sector, security of supply as well as implementing the international agreements on environmental protection.

According to the implementation schedule, the project will commence in 2005 and Belene NPP Unit 1 commercial operation to be started in 2010.

2.2.2.  Performance of NPPs

For the last 10 years the electricity share of KNPP in Bulgaria has been 44-46 %. In 2003, only four of the six nuclear units on Kozloduy NPP site were in operation. As compared to the record - breaking 2002 production of 20 221 719 MWh, the electricity generation in 2003 was reduced by 14,56 % and amounted to 17 278 411 MWh. Kozloduy NPP share in the 2003 gross electricity generation dropped by 6,66% as compared to the previous year. At the same time, the share of each of the Kozloduy NPP units was increased by 2%.

During the past year Kozloduy NPP confirmed its importance as the most reliable and safe electricity supplier during the period of an unprecedented low level of the Danube River which caused an interruption of the electricity generation from many power plants in the region.

During the last few years, the generation has been in compliance with the predicted demand of the country. Despite the dispatch limitation for the plant output imposed in the period from the end of April to the middle of June, in 2003 Kozloduy NPP over-fulfilled its production targets by delivering 104% of the planed amount. All units produced more electricity than planned. Most significant is the performance of Unit 4 which operated at a greater output than planned throughout the whole year despite only very minor deviations from its operating schedule.

For the last 13 years the availability of Kozloduy NPP units was increased up to average world-wide values. The Unit Capacity factor reflects the effectiveness of plant programs and practices in maximising available electricity generation and indicates how plans are operated and maintained.

In 2003, 99,38% (20 457 132 MWh) of Kozloduy NPP's maximum planned availability was provided which is within the frames of the 3% reserve agreed with the National Electricity Distribution Company. In 2003 Kozloduy NPP has used 47,78% (295 053 MWh) of the permitted unavailability time for maintenance outside the outages. As compared to 2002, there is an 11,17% decrease of the non-generation (planned and non-planned). The stable tendency for reduction of the non-generation share continues (by 5-6% per year). The capability factor values of Kozloduy NPP are comparable with the average indicators of the very best nuclear plants world-wide.

The Unit Capability Loss factor reflects the effectiveness of plant programs and practices in maintaining systems available for safe electrical generation.

After implementation of the main part of the modernisation program of Kozloduy NPP Units 5 and 6 the capability loss factor was sufficiently decreased below the average world-wide values.

The Unplanned Automatic Scram per 7000 Hours Critical indicator monitors progress in reduction the number of unplanned reactor shutdowns. It provides an indication of success in improving plant safety by reducing the number of undesirable and unplanned transients requiring reactor scrams, as well as an indicator of how well a plant is maintained. Taking into account the hours that a plant was critical indicates the effectiveness of scram reduction efforts while the plant is operating.

The Kozloduy NPP Units 5 and 6 have been operating without unplanned automatic scram since 1994 and 1996 respectively.

The Collective Radiation Exposure monitors the efforts to minimise the total radiation exposure at each unit and in the nuclear industry as a whole. It is a measure of the effectiveness of the radiation protection programs in minimising radiation exposure to plant personnel.

Optimal staff radiation protection is one of the main applied management principles, which ensures the lowest possible levels of radiation for the personnel. The Bulgarian radiation protection standards are strictly observed. In recent years there has not been any recorded case of exceeding the annual radiation dose limit of 20 mSv for exposure to radiation at work. The comparison of the personnel collective dose data averaged per unit of Kozloduy NPP, against the same WANO indicator shows that a level comparable with the best results in the world is achieved. Individual dose exposure indicators are compatible and confirm the radiation protection effectiveness.

After implementation of the complex modernisation program of Kozloduy NPP Units 1-4 the Collective Radiation Exposure was sufficiently decreased well below the average world-wide values.

2.2.3.  Plant upgrading and plant life management

2.2.3.1.  Kozloduy NPP, Units 1-4 modernisation process

The systematic analyses for compliance of the Units 1-4 with the current safety requirements and the internationally adopted codes and practices began in 1990 and were initiated by IAEA safety review and WANO missions. Considering the results of these first evaluations in 1991 the so-called Short Term Program for implementation of the safety upgrading measures on these units was developed.

The implementation of the program commenced in 1991 and was completed in 1996. A total of over 900 modifications of systems and equipment have been implemented, and many important new safety systems were installed. The total amount of the funds, allocated to the so-called Short Term Program was 145 MUSD.

Continuation of the safety upgrading process initiated by the Short Term Program has been assured by parallel development of a new, Complex Program based on the Periodic Safety Review methodology of IAEA. The review itself was completed within two-year period and with the support of the original designers of the units from Russian engineering organisations. The goal of this assessment was to develop an effective set of measures that would bring the units in conformity with the current safety standards. More than 450 man-months of highly qualified expert efforts were dedicated to this assessment.

A system of presented here 25 classification categories, developed on the basis of safety functions and conditions to ensure their integrity was used for the analysis.

As a result of the assessment a new comprehensive (so called Complex) Modernisation Program was developed. Altogether 100 million of USD were allocated for implementation of the proposed technical measures and during the period of 1997-1999 more than 460 design changes were implemented.

In parallel, to provide maximum effectiveness of this program, it was subjected to a broad international assessment. Several missions from IAEA and WENRA and expert assessments by EdF and Siemens have been carried out for the purpose in 1998 and 1999. In February 2000 a new revision of the program, named PR-209M was issued in order to reflect the results of these reviews.

The extended program scope was mainly applied to the modernisation of Units 3, 4 while the implementation of some measures on Units 1,2 were delayed due to the taken decision for early closure. The total amount of funds allocated to implementation of this revision of the program was 66 million of USD.

The implementation schedule has been accordingly updated keeping the approach of continuous safety upgrading of the units. According to this the major part of activities were implemented for unit 3 and 4 till 2002 (a total of 375 design changes) finishing with a total up-date of the units' SAR. Some long-term activities, mainly oriented to severe accident management, continued. The design changes implementation by the different programs represents an integrated process, which led to extremely extended changes to the design bases of the respective units.

The real implementation of the different Modernisation Programs during the years till 2002, brought the safety of Units 1-4 to a different level compared with their original design. Especially for units 3 and 4, the current extended design basis is successfully compared to the safety level of the WWER-440/213 reactors that is internationally recognised as adequate after IAEA in-depth review.

In 2002 an updated "Safety Analysis Report" of units 3 and 4 was issued, reflecting the new design status after the finalisation of the Modernisation Program and taking into account the operational experience of the units. It was developed in accordance with the scope and content approved by regulatory body in compliance with current world-wide practice.

The updated "Safety Analysis Report" of units 3 and 4 is the basic document and is a condition for issuing operation licenses to KNPP in compliance with the requirements of the new Safe Use of Nuclear Energy Act (SUNEA) after the expiry of current operation licenses.

Having presented this document and the other necessary documentation as well as a review under SUNEA, at the end of May 2003, the NRA issued long-term licenses for operation of units 3 and 4 for 8 and 10 year term of operation respectively.

Among the others the following extremely important results form the modernisation activities should be highlighted:

• Extension of the list of postulated events for which the unit's safety systems can cope with, in line with the commonly accepted design approach.
     •  The capacity of the ECCS have been proven sufficient to cope with LOCAs which exceeds more than 80 times the break cross-section of the original design (up to Dn 500), thus resolving one of the main remarks on these units level of safety;
     •  The containment leakage was reduced more than 35 times. Together with the rest of technical measures implemented to improve the localisation system performance it allowed to justify that the radiological consequences will be managed well bellow the prescribed limits for all postulated events and even beyond;

• Significant improvement of the capability and reliability of the last protective barrier against spreading of radioactive products into environment in case of an accident.
     •  The necessary technical solutions for the modernisation of the confinement system have been developed and justified. A pressure suppression device (Jet Vortex Condenser) was successfully licensed and implemented in 2001-2002 for units 3 and 4. The condenser reduces passively the containment pressure in case of an accident thus from one side preventing its over pressurisation and from another limiting the uncontrolled releases to the environment bellow prescribed limits.

• Other important result is the achieved compliance with current design principles:
     •  application of single failure criteria;
     •  separation between control and protection functions;
     •  testability and operability monitoring;
     •  redundancy, separation and other measures to cope with common cause mode failures etc.

Important assessments on Fire Risk, Environmental Impact, Equipment Classification and Reliability and others have been carried out in parallel to supplement other technical measures. The development of Rest Lifetime Management Program together with the optimisation of the ISI program creates the necessary basis for steady, safe and efficient operation of the plant.

Complex plant approach allowed significant changes in other safety significant areas.

• As a complex result, significant reduction of the overall Core Damage Frequency (CDF) is achieved, bellow the target value established for the reactors in operation world-wide.

The plant successfully implemented a set of measures to address operational safety issues, identified by IAEA in 1991. Two OSART reviews were conducted in the period 1999-2001 with a third follow-up conducted in 2002. The IAEA experts concluded that all operational safety problems, has been resolved and the plant operational practice corresponds to the international safety standards worldwide.

As a result of continuous safety improvement the plant also successfully resolved the design safety issues, identified by IAEA in the document "Ranking of Safety Issues for WWER 440 Model 230 NPPs - TECDOC 640". A special IAEA mission conducted in 2002 concluded that all safety problems, defined by international experts has been resolved and in some cases the plant efforts went well beyond them, covering other areas with possible impact on the overall units safety.

A general conclusion on all the efforts was given in the IAEA Annual Report for 2002:

"A Safety Review Mission to Kozloduy, in Bulgaria, reviewed the results of more than a decade of safety upgrades and assessments at units 3 and 4, including a series of actions recommended by various IAEA Review Teams.

The Team concluded that the operational, seismic and design safety at Kozloduy now corresponds to the level of improvements seen at plants of similar vintage elsewhere.

Many of the safety measures adopted for these plants in the design, operation and seismic areas exceeded those that were foreseen."

In line with the above conclusions was the outcome of the AQG Peer Review, conducted upon a specific Bulgarian request in 2003. In 2001 the AQG, created as an EU advisory body on the nuclear safety issue published a report identifying a set of recommendations to each of the EU accession countries in their striving for high level of nuclear safety. These were recommendations not only in the area of the safety of particular installations but also in the legislative and institutional framework existing in the country to warrant preserving of the nuclear safety level.

First assessment of the achievements of each country was conducted in 2002. In November 2003 a team of 12 experts from Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Spain, United Kingdom and the EC performed new thorough evaluation of the country progress under the leadership of the Italian representative.

During this mission items related to recommendations of AQG reports were discussed with Kozloduy NPP, Nuclear Regulatory Authority (NRA) and Ministry of Energy and Energy Resources (MEER).

Although in accordance with its mandate the review was based on recommendations in the last AQG report, the discussion in many areas went out of these issues, covering all important areas of the plant program especially for Units 3&4. In the same time issues going out of the 2001 AQG report were discussed like the long-term improvements program (up to 2009) and adequacy of their financial provisions, plant and regulatory body commitments in long-term modernization plans and other condition included in the new operational licenses effective until 2011 and 2013 for Units 3 and 4.

Following the technical evaluation of the information made available before and during the mission several conclusions on the status of the recommendations contained in the 2001 Report on Nuclear Safety in the Context of Enlargement were presented in the AQG/WPNS final official report i.e. the following:

• There was evidence that all the AQG/WPNS recommendations have been adequately addressed.
• It was recognised that the personnel from Kozloduy NPP have up-to-date knowledge of international practices and upgrading measures, and related application, in other similar nuclear units in eastern European countries. There was evidence of effective and comprehensive upgrading of the Units 3 & 4 when compared to the status of a few years ago."

In its report AQG also commented that most of the recommendations, including all requested for units 3 and 4, are already implemented. The remaining are in progress according to established schedules. The actions, which are being carried out, concern units 5 and 6, which large scale modernisation program is underway, or long term projects on units 3 and 4 which are going well beyond AQG recommendations.

All they were assessed as adequate and feasible in terms of human and financial resources.

Based on this AQG/WPNS made the fundamental conclusion that for Bulgaria further monitoring activities by the AQG/WPNS are not considered to be necessary, fully confirming the already recognised capability of the Bulgarian nuclear program in resolution of generic safety issues.

The conclusions of the team on the specific issues and in general were in full agreements with the other previously available international assessments like the assessment of IAEA SRM 2002 on the results of Units 3 and 4 modernisation program.

The main conclusion of the reviewing team is that all AQG recommendations to Kozloduy NPP of 2001 and 2002 have been implemented and do not need further monitoring. It was stated that excellent engineering work was performed at Kozloduy NPP concerning the Accident Localisation System, which is in full compliance with the western approaches and good practices. The experts found that the reactor safety of Units 3 and 4 is provided with a considerable reserve up to the end of the term of the licenses issued by the NRA. Concerning the management of severe beyond design basis accidents, the implemented activities were assessed as exceeding the scope of AQG recommendations.

2.2.3.2.  Currents status of Kozloduy NPP, Units 1-4

In accordance with the preliminary announced plans, units 1 and 2 of Kozloduy NPP were operated until the end of 2002 and then were consecutively disconnected from the grid and put in cold sub critical state. In the beginning of 2003, the nuclear fuel from the reactors was transferred to the reactor spent fuel pools and the units were brought to the corresponding mode according to the requirements of the Technical Specifications.

In the beginning of 2004, after a review of the fulfilment of the specific requirements prescribed as additional measures for safety during long term stay of the units in such mode, NRA issued licenses with term of 5 years validity. According to the licenses units 1 and 2 cannot be used for the generation of electricity and the activities are limited to the storage and cooling of irradiated and spent nuclear fuel in the reactor pools with no fuel in the reactor core.

Based on the new design basis of units 3 and 4 and the current operational practice reflected in the updated SAR, operational procedures and other documents, NRA issued long-term operational licenses. The unit 3 license was issued 22 June 2003 with an 8 years term of validity and the license of unit 4 was issued 26 February 2003 with a term of validity of 10 years.

The conditions of units 3&4 operational licenses contain requirements for the continuation of the implementation of measures, included in other programs as continuation of PRG'97A, aiming for further improvement of the safety level. Main part of these programs will be completed within 2005 with some activities with regard to residual lifetime management scheduled until 2009.

Currently in line with the conditions of the licenses, Kozloduy NPP is implementing the strategy for severe accident management. The strategy includes development of Severe Accidents Management Guidelines and implementation of technical measures for management of the fuel cooling and radioactive releases in case of core degradation. Installation of hydrogen recombiners and forced filtered venting systems in the units' accident localisation systems is in the process of implementation.

2.2.3.3.  Kozloduy NPP, Units 5 and 6 modernisation process

The Kozloduy NPP units 5 and 6 are equipped power reactors of the WWER-1000/V320 type. The design of these reactors meets entirely the international requirements for nuclear safety. The main principle for NPP safety is applied: defence-in-depth with several physical barriers, including the redundancy, diversity, independence, protection against failures, and passive elements. The active safety systems have 3x100% capacity, functional independence and they are physically separated. Their large dry containment is designed for full pressure - 0.5 MPa.

The main objective of Units 5 and 6 Modernisation Program is to implement the improvements necessary to meet all international requirements for NPP's with VVER-1000/V-320 units in terms of safety and reliability, in order to extend the unit lifetime following Periodic Safety Review process, required by NRA. The Program is based on IAEA recommendations described in Safety issues and their ranking for VVER-1000 model 320 NPPs (IAEA-EBP-VVER-05). In this document, the safety issues of VVER-1000 reactors are divided in two main groups - design and operational issues. Units 5&6 Modernisation Program solves these issues and comprises 212 measures, each including one or more issues. The identified measures' adequacy towards the list of unresolved safety issues was reviewed by IAEA in 2000. The IAEA expert mission concluded that for all safety issues, the process of their resolving was started and relevant measures are completely or partially implemented, in accordance with Safety issues and their ranking for VVER-1000 model 320 NPPs (IAEA-EBP-VVER-05).

In 2003, Unit 5 worked without an outage and the main efforts were focused on Unit 6. The modifications implemented are comparable to the commissioning of a new unit, as the scope and terms of this reconstruction have no precedent in the world practice. Over 20 international companies were involved in the works, the major effort being undertaken by the Main Contractors - European Consortium "Kozloduy" (ECK), composed of the French and German branch of Framatome together with the Russian Atomstroyexport and the American company Westinghouse. A significant part of the engineering, installation and commissioning work under the Modernisation Program was performed by Bulgarian sub-contractors. The current status of Units 5 and 6 modernisation program implementation is presented in table 13.

TABLE 13. IMPLEMENTATION STATUS OF UNITS 5 AND 6 MODERNIZATION PROGRAM BY THE END OF OCTOBER 2004

Units 5 and 6 Modernisation Program is developing as planned in compliance with the approved schedule, which envisages its completion in 2006. The implementation of the program is successfully by a well organised project management team applying high technologies and engineering solutions that will considerably contribute to the enhancement of safety, reliability and performance of KNPP. This program will give a positive example of high quality modernisation of an NPP with VVER reactors.

2.2.4.  Nuclear power development projections and plans

At the end of 2002 Bulgarian Government took a decision to perform a feasibility studies for renewing the construction of the second Bulgarian NPP at the Belene site. In April 2004 Bulgarian Government approved in principal the continuation of the construction activities at Belene site based on Least Cost Plan developed by National Electric Company. In November 2004 the Ministry of Environment and Water approved the Environmental Impact Assessment on Belene NPP.

The most recent generation planning forecasts of electric demands for the period 2004 - 2020 project that Bulgaria needs new electrical generating capacity to replace nuclear assets scheduled for retirement, to satisfy domestic load growth, maintain energy security, and continue with present and expected commitments for electricity export. The generation planning analysis also concludes that an additional 1000 to 2000 MWe of base load units between 2010 and 2015 represent the capacity needed to service the anticipated demand.

Of the available generation technologies, nuclear units in the 1000 MWe range is a viable and convenient option for Bulgaria, considering available alternatives, environmental attractiveness, potential economic returns, and utilisation of strong in-country nuclear engineering support structure.

Belene is the most suitable site for the new NPP, offering location advantages, ability to meet current regulatory requirements for nuclear sites, as well as the opportunity to finish the partially completed Unit 1. Bulgaria possesses strong capability and more than 30 years (131 reactor years) experience in building, operating and maintaining nuclear power plants. This capability is a valuable resource that can be maintained and used in the development, design, construction and safe and reliable operation of a new nuclear power plant. The latest forecasts of in-country consumption, export sales, reserve and peak load requirements have been combined with estimates of the available and planned generation capacity to yield the following projection:

Using internationally accepted generation planning methods, the optimal solution for meeting capacity requirements is the commissioning of 1000 to 2000 MWe of new capacity starting in 2010. Confirmation that nuclear technology as the optimum generation type to supply this needed capacity is based upon the following:

• There is insufficient hydro potential within Bulgaria and that other renewable technologies are not capable of providing a sufficient quantity of power;
• Thermal coal-fired (including indigenous lignite and imported fuel) generation is feasible, but conflicts with the requirement to meet international commitments to reduce air emissions, including SO₂ and CO₂;
• Gas-fired plants are planned for cogeneration, and will comprise an appropriate part of the energy mix; however, it will not satisfy all energy needs due to concerns related to excessive levels of primary energy imports and anticipated gas price uncertainty, and reliance on gas imports will compromise the security of the energy supply;
• Bulgaria has significant capability and experience in the nuclear field;
• Low Nuclear plant lifecycle costs will ensure their base load status and help ensure a stronger competitive position for selling electricity in the region; and
• Based on the preceding benefits, the Ministry of Energy and Energy Resources has adopted nuclear power in their energy strategy.

Therefore, to satisfy domestic load growth, maintain energy security, satisfy environmental objectives, and continue with present and expected commitments for electricity export, the clear way forward for Bulgaria is to proceed with the addition of two 1000 MWe nuclear units between 2010 and 2015.

The Feasibility Study also addresses the history of the Belene site, new requirements for site selection, any excluding or limiting factors, and vicinity information. The main conclusions of the study are:

• Numerous site-related studies and evaluations have concluded that the Belene site is the preferred location, and is suitable and eligible for licensing for the construction of nuclear power plants capable of supplying the needed generation capacity.
• The site was independently evaluated by IAEA experts who concluded that the site has no excluding factors.
• The demonstrated suitability of the site, combined with the opportunity to use the partially completed project at Belene, not only supports the nuclear option decision but also the selection of the Belene site.

The advantage of the option utilising the WWER 1000/B-320 on Unit 1 is that it has the potential for the maximum use of the delivered equipment and minimises potential major equipment delays. Alternatively, a significant advantage of the option with use of WWER 1000/B-466 on both Units 1 and 2 is that it utilises the NPP that scored the highest in technical ranking; utilises new technology that has a higher rated output and a sixty (60) year plant life; provides for two identical units that results in minimising spare parts inventory; reduces costs associated with simulators and employee training; and aids in minimising the potential for human factor related issues.

The technical and economic evaluations resulted in the identification of the optimal two-unit variants. Nonetheless, based on the results of these evaluations, it was recommended that the final selection between the variants described in the Feasibility Study be based on firm vendor cost information obtained through a open or selective tender procedure.

The socio-economic aspects of construction of Belene and project execution approach were also analysed. The major socio-economic conclusions are:

• The completion of Belene will result in significant decrease in unemployment in the region;
• The investment required to complete Belene will have a substantial positive impact on the both regional and national Gross Domestic Product (GDP) and income levels; and
• Public opinion polls indicate strong local and national support for nuclear power and completion of Belene.

In addition to the above, completion of Belene will allow Bulgaria to continue as a key regional energy supplier.

2.2.5.  Decommissioning information and plans

The Law on the Safe use of Nuclear Energy stipulates that licensees must have adequate financial and material resources to maintain safety at all stages of the plant's life. This includes decommissioning and the subsequent management of radioactive waste.

The legal provisions for financing the management of radioactive waste and decommissioning funds for the nuclear waste and decommissioning programs have been established since 1999.

The real functioning of the Funds started in 1999 after approval of the corresponding Regulations. The National Electric Company and later Kozloduy NPP have started with payments since 2000. The national radioactive waste management enterprise was established in 2004.

Contributions are specified by the Council of Ministers and currently these are 15% of electricity sales return for decommissioning and 3% for Radioactive Waste Management. There are also contributions from the state budget.

The Bulgarian Authorities recognise the need to keep the funds under review and have the power to impose changes. The situation is reviewed every 3 years by the Ministry of Energy, the utility, the regulator and other government departments.

Bulgaria's own contribution is currently above 18% of the revenues from electricity sales - more than in every other EU country. The Bulgarian Authorities fully recognise the financial implications associated with NPP decommissioning and waste management. Arrangements have been made to set up appropriate funds and to periodically review the contributions to these funds and the funds operations and financial transactions with the purpose to provide for the funds' adequacy.

The Technical Design for the Decommissioning of units 1-2, which was prepared by Belgatom- EWN-Energoproject Consortium still is the ruling document of the decommissioning process. The modified circumstances of, and the new requirements to the decommissioning, however drive the Kozloduy NPP to update it. The main body of the existing strategy is not going to change, but the new edition will include:

• options of financial and economical management of a decommissioning entity;
• the dismantling process;
• options of use of the existing capacities for decommissioning purposes, including manpower;
• safety and environmental impact consideration;
• radioactive management.

Currently there are several projects under implementation:

• Design and Implementation of the Dry Spent Fuel Storage Facility
• The Facility is cask-type. The spent nuclear fuel assemblies will be stored in licensed metal-concrete casks. The 2,800 assemblies will need 34 casks, in each of them 84 VVER-440 fuel assemblies. The casks will be stored standing up in a controlled and closed Facility within the Kozloduy NPP operational site.
• Facility for Cleaning and Conditioning of Liquid Radioactive Waste of Low Activity
• This facility will be installed in Special Building No 1 of Kozloduy NPP and has the goal to replace the systems that will be decommissioned and had the function of cleaning of liquid radioactive waste of low activity.
• Physical Separation of the decommissioning and Changes in the Organisation of Access Regime of the Plant
• Facility for decontamination of Pools, Tanks of Big Volumes and Cleaning the Water
• Facility for Conditioning of Solid Radioactive Waste and Ion Exchange Resins with High Volume Reduction Factor. This project is made up from two investments - Facility for Conditioning of Solid Radioactive Waste and Ion Exchange Resins with High Volume Reduction Factor. This conditioning facility will be divided into two parts: one for the combustible radioactive waste (supposed to be an incinerator) and the other for ion exchange resins; and Equipment for Retrieval of Ion Exchange Resins from Tanks.
• Facility for Free Release Measurement. This facility will provide measuring equipment capability in order to grant the free release of dismantled plant equipment, components and materials.
• Facility for Personnel Redressing and Decontamination.

The Units 1 and 2 spent fuel pools de-fuelling is planned to be implemented after commissioning of Dry Spent Fuel Storage Facility expected in 2009.

2.3.  Supply of Nuclear Power Plants

Bulgaria does not supply nuclear power plants and/or equipment for nuclear power plants. The equipment for the existing plants have been purchased from Russia, but some parts and systems have been supplied from western suppliers like Siemens, Westinghouse, Sempel, Sebim, Framatome and others.

2.4.  Operation of Nuclear Power Plants

The Council of Ministers of Republic of Bulgaria adopted Resolution No.70 dated 20 February 2001, according to which all nuclear power plants and other equipment on "NPP Kozloduy" PLC are defined as one nuclear installation and "NPP Kozloduy" PLC is its operator according to the Vienna Convention on Civil Liability for Nuclear Damage.

"NPP Kozloduy" PLC as "nuclear installation operator" according to the Vienna Convention on Civil Liability for Nuclear Damage is the bearer of the corresponding civil responsibility. As "license holder" according to Nuclear Safety Convention, the company bears the responsibilities for nuclear safety. This is reflected in the NPP "Kozloduy" PLC Statute (art.2, para 2 and para 3) and in Corporate Structure and Activities Code (art. 5 and art. 6). In this respect, the company holds a license, given by the State Energy Regulation Committee on production of electrical and thermal energy (Verdict No. 049 dated 11.12.2000 of SERC).

As the operating organisation is responsible for ensuring fulfilment of safety requirements, "NPP Kozloduy" PLC rights and obligations are defined in the Statute, Corporate Structure and Activities Code, company structural subdivision and sections activity organisation regulations, as well as in the personnel job descriptions for the whole hierarchy managing chain.

"NPP Kozloduy" PLC responsibilities and obligations are summarised in art. 7 of Corporate Structure and Activities Code and are performed through "implementation of activities for nuclear safety maintenance and enhancement, radiation protection, physical protection, emergency preparedness, technical safety, preserving the health of personnel and population and environment."

In "NPP Kozloduy" PLC Corporate Structure and Activities Code" (art.8) the implementation of overall company activity, the following principle is of top priority: "Following the requirements for nuclear safety, radiation protection, as well as preserving the life and health of personnel, population and environment has priority over operational and other public needs."

"NPP Kozloduy" PLC is a separate corporate body, registered according to Commercial Law, which has an independent balance and bank accounts. General Meeting and Board of Directors manage the Company. "NPP Kozloduy" PLC organises and manages its commercial activities in accordance with the Statute and "NPP Kozloduy" PLC Corporate Structure and Activities Code".

For ensuring safe operation, the Kozloduy NPP management:

• develops and implements an administrative structure, assigns responsibilities and powers within the structure and exercises the overall management;
• develops, introduces and supervises the implementation of the programmes for administrative control (guiding documents for systematic implementation of planned works-schedules. procedures, inspections and revisions provided with adequate resources for their implementation);
• establishes a system for the accomplishment and control of the license conditions and terms of duration;
• establishes and maintains openness and correctness with the Regulatory Body, other state control bodies, organisations and the public, concerning the supervision, inspections and discussions on the fulfilment of the prescribed and universally accepted safety requirements;
• for exchange of experience and information, keeps in contact with the design, engineering, maintenance, mantling and construction organisations, and the manufacturers of equipment for nuclear power plants;
• ensuring the necessary resources and services for safe operation.

2.5.  Fuel Cycle and Waste Management

The Kozloduy NPP Fuel Cycle includes all inherent stages as Uranium purchase, Conversion, Enrichment, Fabrication, Interim Storage, Spent Fuel transportation, Reprocessing and VHLW disposal based on the agreement between Republic Bulgaria and Russia and following long term commercial contracts for fuel supply and spent fuel reprocessing.

Kozloduy NPP has been sufficiently increasing the burn-up and achieved a reduction of spent fuel generation during transition from 2 year to 4 year fuel cycle length. These design changes also lead to decreasing of specific consumption of natural uranium up to 28%.

The new Strategy for spent fuel management and radioactive waste is developing. Two options of spent fuel management were analysed - spent fuel reprocessing and spent fuel disposal. The levelled fuel cycle cost was used as a criterion for decision making.

The results indicate that there is a small cost difference between the prompt reprocessing option compared with the long-term storage and direct disposal option. Based on best estimate data, the reference cases show a difference of less than 20 per cent of the total nuclear fuel cycle cost taking into account all spent fuel accumulated at the Kozloduy site, the cost of the direct disposal option being lower. In light of the underlying cost uncertainties, this small cost difference between the reprocessing and direct disposal options is considered to be insignificant, and in any event, represents a negligible difference in overall generating cost terms. It is likely that considerations of national energy strategy including reactor type, environmental impact, balance of payments and public acceptability will play a more important role in deciding a fuel cycle policy than the small economic difference identified.

Kozloduy NPP target is to minimise the impact on the population and environment of the radioactive wastes and spent nuclear fuel stored at the plant site. The management of these activities is in compliance with the requirements of the Vienna Convention on Safety of Spent Nuclear Fuel Management (SNF) and on Safety of Radioactive Wastes Management (RAW).

During the operation of the nuclear power plant liquid and solid radioactive wastes are generated. Compared to the unit of produced energy the RAW quantities generated by NPP are over 10 000 times lower than the wastes from coal-fired power plants.

The generally accepted principles for RAW management define the requirement the RAW to be collected, treated, conditioned and stored in a way that provides protection of human health and environment protection now and in future without being a burden to the future generations. At Kozloduy NPP site, a facility was constructed for treatment, conditioning and storage of low-level and intermediate-level liquid and solid radioactive wastes. The commissioning of this facility gave a permanent solution of the issue for reliable storage of RAW and is also a significant contribution to environment protection.

As a result of the commissioning of this facility and the program applied during the last years to minimise the radioactive wastes, the speed of treatment and conditioning of RAW for long term storage has increased.

The spent nuclear fuel (SNF) is stored at the plant site under conditions which provide safety for the environment and population. After storage in special at-reactor spent nuclear fuel pools, the fuel is removed to a specially constructed Wet Spent Fuel Storage Facility for storage of spent nuclear fuel for all units.

The capacity of the facility allows storage of all spent nuclear fuel assemblies being discharged now and for the future years until the commissioning of the new facility.

The conditions created for safe storage of SNF at the plant site, together with the fact that part of the fuel is transported for reprocessing and long term storage in Russia, provide a mid-term solution of the SNF safe management issue. Together with the Ministry of Energy and Energy Resources (MEER), NRA and other national institutions implementation is prepared applying the best practices for long term safe storage of radioactive wastes and spent nuclear fuel.

2.5.1.  Management of the Spent Fuel at the Kozloduy site

The SF removed from the reactors is stored in pools situated near by the reactors. In 1990, the construction of a pool type spent fuel storage facility (SFSF) on the site of the Kozloduy NPP was accomplished. It is situated in a separate building on the territory of the Kozloduy NPP, nearby units 3 and 4. According to the design, the SFSF is to be filled in 10 years and the assemblies can be stored in it for a period of 30 years. After 3-5 years storage in the near reactor pools, the SF is transported to the SFSF. In 1991, a programme for enhancement of the SFSF safety was elaborated which is now being updated. In 1992, the new seismic characteristics of the Kozloduy NPP site were taken in account in the Programme.

Two independent ecological assessments of the SFSF were carried out: an expertise made by a team from the Risk-Engineering company as well as a complete report of the impact on the environment made by a group of specialists from the Sofia University "Kliment Ohridski". The results of these assessments do not show any considerable negative impact on the environment from the SFSF operation.

In March 2001, the NRA has licensed the SFSF.

2.5.2.  Management of Low and Intermediate Level RAW

The generated from the NPP operation RAW are stored in auxiliary buildings (AB), one for two units. In recent years, the NPP generates annually average of about 350-m³ liquid RAW, 200 m³ conditioned solid RAW and 20 m³ low and intermediate ion exchange resins.

The work on the completion of construction of the RAW Treatment and Storage Facility for LILW at the Kozloduy NPP site is completed. The Treatment and Storage Facilities are in operation.

A fund for Management of Radioactive Waste is established by the ASUNE. All waste generators shall pay special fees to the fund: currently for NPP Kozloduy it is about 3% of the average market price of energy sold to the National Electric Company. The Minister of Energy and Energy Resources through relevant Steering Committees manages the funds.

2.6.  Research and Development Activities

In the field of nuclear R&D, Bulgaria is in co-operation with international organisations like: the Joint Institute of Nuclear Research in Dubna, Russia; the Institute of Theoretical Physics, Trieste; OECD Halden Reactor Project, CERN and other foreign institutes. NRA pays the membership fee in these organisations.

Nuclear research and development activities in Bulgaria are carried out in several institutes, the most important of which are:

• The Institute of Nuclear Research and Nuclear Energy at the Bulgarian Academy of Sciences;
• The University of Sofia Department of Nuclear Physics, Dept of Nuclear Technology and Nuclear Power Engineering and the Radiochemical laboratory;
• Technical University of Sofia, Department of Power and Nuclear Engineering;
• Plovdiv University, Department of Nuclear Physics; and
• Other smaller Institutes and research organisations.

All these organisations are financed by the national budget. Each year the Government donates them with the Act of the State Budget.

2.7.  International Co-operation

As a member of the world community of nuclear operators, Kozloduy NPP maintains a continuous process of information and operational experience exchange with the International Atomic Energy Agency (IAEA), the World Association of Nuclear Operators (WANO) and other international organisations and leading companies in the filed of nuclear energy.

Through participation in the international peer review process, Kozloduy NPP obtains assessment and support of its efforts in operational safety enhancement. In 2003 the plant was a host of two major reviews:

• June 02-13 - WANO Mission to units 3"4;
• November 16-19 - Expert Mission of the EU Council's Atomic Questions Group (AQG).

Both expert teams acknowledged the exceptional efforts invested by the plant during the last several years and the high motivation of people working at KNPP.

The plant participated in a number of regional projects and technical assistance programmes of IAEA, WANO, EU PHARE Nuclear Safety Programme, Nuclear Safety Programme of UK Department of Trade and Industry (DTI) and in different bilateral co-operation programmes. Also Kozloduy NPP took part in the activities of the largest international and European forums and organisations such as World Nuclear Association (WNA), European Nuclear Society (ENS) and European Nuclear Forum - FORATOM (through BULATOM). This enabled the KNPP specialists to be in line with nuclear energy news and to present before the international science community and bodies of EU the achievements of Bulgarian nuclear industry.

In 2003 the First National Report of the Republic of Bulgaria was presented on implementation of the obligations under the Joint Convention for Safety of Radioactive Waste and Spent Fuel Management. Bulgarian nuclear leading experts participated in the development of the report and answers to additional questions posed to Bulgaria by the Convention countries.

2.8.  Human Resources Development

The personnel of Kozloduy NPP responsible for the safe operation of nuclear facilities have a high educational status. In 2003, 80% of the KNPP employees had a university degree and high technical education. This was achieved through a system for recruitment of new personnel with higher education and qualifications as some employees reached the retirement age, and who had lower educational qualifications.

The measures for personnel number optimisation (down-sizing) undertaken after the detachment of Kozloduy NPP plc as an independent commercial company in 2000, have given good results. In the last three years the staff number has been reduced by 20% at the end of 2003. It should be noted that both output and safety levels have increased over the same period. The good performance indicators in the last several years have given the opportunity to keep a good salary level at Kozloduy NPP, as compared to the average salary in the country.

One of the most important factors of the safe, reliable and effective operation of Kozloduy NPP is the availability of well-trained and qualified personnel. The overall training process and personnel qualification control are conducted in accordance with the Systematic Approach to Training implemented in all nuclear power plants. For improving the qualification of NPP personnel, two basic forms of training are applied - theoretical training (lectures, self-training and computer-based training) and on-the-job training. The plant Training Centre is equipped with modern simulator facilities, ensuring adequate training for licensed operators and line managers as well as the performance of a number of engineering tasks and analyses. At present two simulators, VVER-1000 Full Scope Simulator (FSS-1000) and VVER-440 Multi-Functional Simulator (MFS) are used for training. Current modernisation programmes are also implemented on the simulators aiming to maintain their conformity with the reference units. All training courses are annually upgraded based on analysis of events in other plants, feedback from the training sessions, unit design modifications and other reasons, including changes of the regulatory requirements.

Provision of a safe and healthy working environment through elimination or maximum limitation of the existing hazards is one of the basic goals of Kozloduy NPP plc Management. In compliance with Bulgarian legislative requirements, which were harmonised with the European requirements for the working environment, a risk assessment of the work place was made and corrective measures were implemented. The data from the last few years proved the effectiveness of the efforts made in this direction. The trend for reducing the industrial safety accident rate is very clear and this indicator is comparable with the world's best NPP indicators according to WANO database.

The social policy of Kozloduy NPP plc is oriented towards provision of equal social benefits aiming at maintaining and increasing the personnel's motivation. Together with the five Trade Unions in the plant a number of social benefits were agreed in accordance with the possibilities given by the labour legislation. The Company annually provides BGN 8 millions for social and cultural funds. The priorities for these funds are determined by the General Assembly of the Kozloduy NPP employees. Kozloduy NPP maintains two recreational complexes, a cultural centre in the town of Kozloduy and a sports facility with two swimming pools and other opportunities for sport and relaxation. Kozloduy NPP Management pursues an open dialogue in communication with the personnel on all the issues - the ones related to production and safety as well as the social problems.

3.  NATIONAL LAWS AND REGULATIONS

3.1.  Safety Authority and the Licensing Process

The National Regulatory Authority in the field of safe use of nuclear energy is the Nuclear Regulatory Agency (NRA). The legal framework in respect of the NRA is provided for in the Act on the Safe Use of Nuclear Energy (ASUNE - in force from July 2002). According to Article 4 (1) of the Act, "State regulation of the safe use of nuclear energy and ionising radiation, the safety of radioactive waste management and the safety of spent fuel management is implemented by the Chairman of the Nuclear Regulatory Agency". Article 4 specifies: "the Chairman is an independent specialised authority of the executive power" and "The NRA Chairman shall be designated by a decision of the Council of Ministers and shall be appointed by the Prime Minister for a mandate of five years and may be selected for one more term of office (mandate)". The functions of the NRA are effectively separated from those of the bodies and organisations involved in promotion or use of nuclear technology.

3.1.1.  Safety Authority responsibilities

Pursuant to Article 5 of the ASUNE, the Nuclear Regulatory Agency shall have the following powers:

• Grant, amend, supplement, renew, suspend and revoke licences and permits;
• Control the fulfilment of safety requirements and standards, as well as the conditions of licences and permits granted;
• Issue and withdraw individual licenses;
• Undertake enforcement measures and impose administrative penalties;
• Assign (contract) nuclear safety and radiation protection related external expertise, researches and studies;
• Implement the interactions with other competent authorities of the executive power vested with some regulatory and control functions and propose to the Council of Ministers measures for co-ordination of the activities;
• Implement the international co-operation of the Republic of Bulgaria in the field;
• Provide individuals, legal persons and state bodies with objective information referring to nuclear safety and radiation protection;
• Submit annually to the Council of Ministers a report on the status of nuclear safety and radiation protection, as well as on the operation of the Agency;
• Organise and co-ordinate the drafting process and submit to the Council of Ministers the reports for implementation of country obligations under the Convention on Nuclear Safety and the Joint Convention on the Safety of Spent Fuel Management and on the Safety of Radioactive Waste Management;
• Organise and co-ordinate implementation of the obligations of the Republic of Bulgaria arising from the Agreement Between the People's Republic of Bulgaria and the International Atomic Energy Agency for the Application of the Safeguards in Connection with the Treaty on the Non-proliferation of Nuclear Weapons, as well as from the Additional Protocol to the Agreement;
• Perform the functions of a competent authority and a contact point for notification of an accident and for provision of assistance according to the Convention on Early Notification of a Nuclear Accident and the Convention on Assistance in the Case of a Nuclear Accident or Radiological Emergency;
• Develop and submit for adoption to the Council of Ministers regulations for the application of the ASUNE;
• Exercise other powers as may be entrusted thereto by the national legislation.

An administration helps the NRA in implementation of its authorities, assures technically its activity, and performs activities on administrative service provided to legal persons and citizens. In its activities, the NRA and its administration is guided by the adopted by the Council of Ministers Organisational Rules of Procedure. The administration is organised in a general department and 4 departments, distributed into general and specialised administration.

3.1.2.  Organisational Structure of the NRA

A Chairman supported by two Deputy Chairmen and an Executive Secretary governs the NRA. The permanent number of the NRA staff is 102 persons (4 - management team, 19 positions in the general administration and 79 experts and inspectors). Six inspectors work permanently at the Kozloduy NPP site. 95% of inspectors have university education and more than 60% of them have over 15 years of experience in the nuclear field. Six NRA employees have Ph.D. degree, including the Chairman and one of the deputies. The organisational structure of the NRA is shown in Figure 19.

The NRA is forming its own budget within the overall state budget. In accordance with Article 10, p. 1 of the ASUNE, the Agency operation is financed by the national budget and by income from the licensing fees collected under the Act provisions. Each year, the incomes and the expenditures at NRA budget and its relations to the central state budget, subsides or donations are defined by the annual Act of the State Budget. The draft budget is developed by the Agency following the Act on the State Budget Organisation. The Ministry of finance considers the budget, proposed by NRA and defines the final version, which is included in the bill of the Act on the State Budget (ASB) for the next year. The ASB is passed in accordance with the order of the Acts passing in the Republic of Bulgaria.

The organisational structure and duties of the NRA structural units are described in the Statute of the NRA (Rules of Procedure), adopted by the Council of Ministers Decree No.199 dated 29 August 2002, as shown in Figure 19.

3.1.3.  Licensing Process

The main legal provisions for the licensing of nuclear installations in Bulgaria are outlined in the ASUNE. The Act specifies the conditions, the order, terms and time limits for issuance of licenses and permits. The NRA Chairman based on a written application by the applicant shall issue licenses and permits for utilisation of nuclear energy. According to ASUNE Article 20 (1), a licence shall be issued for a term of validity not exceeding ten years.

All documentation submitted in respect of requested license issuance shall be in Bulgarian language. Submission of the original documents in a foreign language is permissible if a notarised translation into Bulgarian language is thereto attached.

3.2.  Main National Laws and Regulations in Nuclear Power

The new Nuclear Law (the Act on Safe Use of Nuclear Energy - ASUNE) entered into force in the middle of 2002 (2 July 2002). According to the ASUNE, the NRA Chairman has no power to issue regulations. The NRA Chairman develops and submits regulations for the application of the Act to the Council of Ministers for adoption (Article 5, item 14 of the ASUNE), through the Deputy Prime Minister.

The ASUNE specifies areas, which have to be regulated by the regulations and submitted to the Council of Ministers on a motion of the NRA Chairman or other State Authority. The Transitional and Final Provisions of the ASUNE require that within two years after the entry into force of the ASUNE, the Council of Ministers adopts new regulations and until then the old regulations are valid if they are not in conflict with the ASUNE.

After entry into force of ASUNE, the NRA initiated a large-scale legislative program for development of a comprehensive set of regulations. The programme included the responsible persons and the deadlines for the development of 19 secondary legal documents (18 Regulations and 1 Rate Schedule) in the area of the safe use of nuclear energy and ionising radiation, safe management of RAW and SNF, physical protection, emergency planning and preparedness, etc. The IAEA IRRT mission and the Peer Review of AQG expressed a high opinion of the programme. As the NRA objective is to establish exact and clear regulatory requirements, the program was based on:

• existing regulations and practices;
• full compliance with the national legislation and the international treaties;
• full compliance with the EU Directives - related to the future membership of Bulgaria in the EU;
• internationally recognised requirements - IAEA Safety Standards;
• international good practice - practices in leading nuclear countries (European), WENRA (reference levels);
• experience of countries in transition with similar nuclear programs - Check Republic, Hungary, Slovak Republic, etc.

The regulatory practice of the NRA has been build up and developed during a long time by taking into account of the legislative requirements, Agency's own experience and the good international practices. The NRA continuously improves its regulatory practice by conducting self-assessment, inviting well known international experts as management consultants, inviting independent external reviews, as well as by making use of the vast potential of the IAEA, WENRA and the leading regulators of the world scale.

During development of the secondary legislation (regulations), the systematic approach was applied in accordance with the national legislation, the importance of the legislative document and the resources available. All NRA employees participated actively in the development of the secondary legislation, as well as representatives of Ministries and other organizations concerned. An internal procedure, part of the QM system (IN QMS-RG-P1/0), has been developed by the NRA and has been used in the process of regulations drafting and adoption.

In September 2003, the Council of Ministers approved two of the 19 normative documents - Rate Tariff for the Fees Collected by NRA under the ASUNE and Regulation for the Fees Payment Procedure. The Regulation and the Rate Schedule guarantee the stable financing of NRA within the framework of the national budget.

At the beginning of 2004, all remaining regulations, included in the programme, except the Transport regulation, were submitted in one package for co-ordination with the ministries and the national institutions concerned. Thus, synchronisation and interrelation between the secondary legislation, its simultaneous entry into force and standardisation of the specific terminology have been achieved. Also, in the development of the regulations, the NRA used the advice and opinion provided to the Chairman by the Advisory Councils on nuclear safety and radiation protection.

At the middle of 2004, the Council of Ministries adopted all regulations under the ASUNE. All regulations should be translated into English and published at the NRA web site to facilitate foreign users and the NRA international partners.

The following fundamental acts of legislation are currently applicable in the matter of safe utilisation of nuclear energy and in respect of nuclear material procurement, accountability, storage and transport:

• Act on the Safe Use of Nuclear Energy (Promulgated in the Official Journal No. 63 of 28 June 2002);
• Tariff for the fees collected by the NRA in accordance with the provisions of the ASUNE;
• Regulation on the procedure for paying the fees ensuing by the ASUNE;
• Regulation on the procedure for the issuing of licenses and permits for safe use of nuclear energy;
• Regulation on the terms and the procedure for notification of and provision of information to the Agency;
• Regulation on providing the safety of nuclear power plants;
• Regulation on providing the safety of research reactors;
• Regulation on radiation protection in activities with sources of ionising radiation;
• Regulation on the safe decommissioning of nuclear facilities;
• Regulation on the safe management of radioactive waste;
• Regulation on the safe management of spent fuel;
• Regulation on the conditions and procedure for acquiring professional qualification and for the procedure for issuing licenses for specialised training and individual license for use of nuclear energy;
• Regulation on the terms and procedure for accounting for nuclear material and for application of the Safeguards;
• Regulation on the terms and procedure for radioactive waste delivery to the Radioactive Waste State Owned Company;
• Regulation on the terms and procedure for exclusion of small quantities of nuclear material from the application of the Vienna Convention;
• Regulation on the basic standards for radiation protection;
• Regulation on the terms and procedure for determination of special statute areas around nuclear facilities and facilities with SIR;
• Regulation on the terms and procedure for the provision of the physical protection of nuclear facilities, nuclear material and radioactive material;
• Regulation on the emergency planning and preparedness;

4.  CURRENT ISSUES AND DEVELOPMENTS ON NUCLEAR POWER

4.1.  Energy policy

The efficient functioning of the energy sector is vital for any economy. Energy is present as an essential component in any end product of industry or services. For this reason, the implementation of the strategy for economically viable, secure and environment-friendly energy supply is a fundamental prerequisite for the attainment of national objectives aimed at a significant and sustainable economic growth and eradication of poverty. Failure to undertake timely actions in this sector leads to the risk of turning it into a heavy burden for the economy as a whole.

On 26 November 2003, the National Assembly adopted the new Energy Act. The Act is in full compliance with the new Electric Power and Gas Directives of the EU with regard to the production, the operation of the systems for transfer and distribution, the separation and the transparency of the accountancy balance sheets and the access to the transfer and distribution systems.

A new market model of regulated access of a third party to the networks is introduced with the new act, which shall replace the model of the "single buyer". The liberalised share of the electric energy market is gradually expanded, following the model of "bilateral contracts with a balancing market." The new act anticipates that the monopoly over the import and export of enteric energy will drop off after the date of the accession of Bulgaria to the EU. The creation of a liberalised gas market with a new market model of regulated equally treated and non-discrimination access of a third party to the networks is regulated as well. Legal separation of the operators of the transfer and distribution systems from the activities relating to production and delivery is introduced. The new Energy Act renders an account of the rules for accelerated opening of the market of electric energy and natural gas. The final goal of the development of the internal energy market is the creation of a competitive retail market, at which all the users will have a possibility of selection of a supplier. The act creates stimulus for promotion of the production of electric energy from renewable energy sources (RES) and of the combined production of heat and electric energy.

• Mandatory purchase of the produced electric energy at preferential prices,
• Introduction of a system for issuance and trade with green certificates.

At the end of 2003 a Draft of an Ordinance on the Issuance of Certificates of Origin of Electric Energy Produced by Renewable Energy Sources and/or in a combined manner was published for public discussion, for the issuance of green certificates and trade with them. In September 2003, the Council of Ministers adopted a bill of the Energy Efficiency Act. The following measures were anticipated:

• Introduction of an obligation for the conduct of energy management;
• Regulation of the possibility for the rendering of energy effective services;
• Requirements for "labelling" and "markings",
• Tax concessions.

4.2.  Privatisation and deregulation

The energy sector needs significant investments for the improvement of the existing infrastructure whose current status is a result of low levels of investments during the past decade. Privatisation represents a powerful instrument through which this goal can be achieved. In the main energy sectors - electricity sector, heat supply, gas supply and coal mining - partial privatisation has been carried out, mainly of companies providing secondary or ancillary activities. Successfully implemented reforms are a mechanism to gain confidence of foreign investors and to ensure the needed especially large investments in energy at low risk premiums and under diversified risk. Privatisation transactions in the energy sector were finalised from July 2001 to December 2003 with total revenues for the budget of 219 million BGN.

The privatisation of hydro power plants, differentiated parts of NEK EAD commenced in 2000. 34 HPP were sold out for the time period 2001 - 2003. The proceeds in the budget add up to over 138 million BGN.

The coal output branch comprises 15 companies with 100 % state participation, which are in a procedure for privatisation. 6 coal output mines and one colliery, a differentiated part, were privatised from July 2001 by the end of 2003. The proceeds in the budget add up to 51 million BGN.

On 5 July 2003, the Council of Ministers adopted Strategy for the Privatisation of Electricity Distribution Companies, which was approved by the National Assembly on 29 July 2003. The consultant for the privatisation was a Consortium, led by BNP - Paribas. The strategy anticipates simultaneous sale of the seven companies, differentiated in three packages:

• First package - Western Bulgaria, including:
• Second package - South-Eastern Bulgaria, including:
• Third package - North-Eastern Bulgaria, including:

The Privatisation Agency adopted the decisions for selection of a privatisation method on 24 October 2003. The sale was performed through a publicly announced two-stage tender without a preliminarily determined minimal price.

By Resolution No 485 of the Council of Ministers dated 15.07.2002 an Annual List of the Trade Companies with State Participation in the Capital was adopted, the shares of which (up to 49% of the capital) were anticipated for trading at the Bulgarian Stock Exchange. Energoremont Holding EAD - Sofia, Energoremont Bobov Dol AD - Bobov Dol, Energoremont Varna AD - Varna, Energoremont Rousse AD - Rousse and TPP Maritsa 3 - Dimitrovgrad were included in the List. In 2003 the companies were successfully traded at the Bulgarian Stock Exchange, after their transformation in public ones. The initially offered 49% of the shares were sold out against non-monetary payment means - compensatory notes with a nominal of 33,8 million BGN, (or 8 million BGN real price). The remaining 51% shares of the companies were traded at the second stage, at the total value of 3 million BGN.

The revenues in the budget from the privatisation of servicing and repair companies add up to 30 million BGN. 9 companies were sold in the time period March 2002 - December 2003 through competitions and tenders, conducted by the Privatisation Agency.

4.3.  Role of the government in the nuclear R&D

• The Institute of Nuclear Research and Nuclear Energy at the Bulgarian Academy of Sciences;
• The University of Sofia Department of Nuclear Physics, Department of Nuclear Technology and Nuclear Power Engineering and the Radiochemical laboratory;
• Technical University of Sofia, Department of Power and Nuclear Engineering;
• National Centre of Radiobiology and Radiation Protection, at the Ministry of Health;
• Plovdiv University, Department of Nuclear Physics;

All these organisations are financed by the national budget. Each year the Government donates them with the Act of the State Budget. In addition, in the nuclear R&D, Bulgaria is in co-operation with international organisations like: the Joint Institute of Nuclear Research in Dubna, Russia; the Institute of Theoretical Physics, Trieste; OECD Halden Reactor Project, CERN and other foreign institutes. NRA pays the membership fee in these organisations.

4.4.  Nuclear Energy and Climate Change

The energy sector is a major source of carbon dioxide and sulphur oxide emissions in the country. The thermal power plants are also a large source of nitrogen oxides and non-toxic dust. Coal-fired TPP release about 80% of the national emissions of sulphur oxides and about 60% of the national emissions of carbon dioxide.

Bulgaria ratified the UN Framework Convention on Climate Changes in 1995. According to the Kyoto Protocol signed in connection with the Convention in December 1997 it undertook the commitment to reduce the anthropogenic emissions of greenhouse gases by 8% per year within 2008-2012 compared to the emissions in 1988. The same joint commitment to reduce the emissions of greenhouse gases was also undertaken by the EU countries.

Emissions of 1 012 752 tons of sulphur dioxide, 36 182 tons of dust, about 52 758 tons of nitrogen oxides and 23 676 261 tons of carbon dioxide were saved in 2003 as a result of the production of electricity and heat from nuclear power, hydro power and co-generating capacities. The emissions were calculated as compared with the adopted reference TPP, burning lignite coal.

TABLE 14. STRUCTURE OF THE AVOIDED EMISSIONS AS A RESULT OF ELECTRICITY AND HEAT GENERATION IN 2003, T

Nuclear power generates electricity with virtually none of the greenhouse gas emissions that cause climate change. Nuclear power generates electricity with hardly any emission of sulphur dioxide or nitrogen oxides, key agents for acid rain and photochemical air pollution.

The impact of Kozloduy NPP operation upon the environment components is subject to detailed and systematic studies since the plant commissioning in 1974. The electricity production technology at Kozloduy NPP in practice does not generate any greenhouse gases and considerably contributes to the environment protection. In June 2002, the Kozloduy NPP was awarded by the Ministry of Environment and Water of the Republic of Bulgaria for the significant contribution to the protection of the environment reproduction and natural resources.

4.5.  Safety and waste management issues

The radioactive waste management activities are carried out in compliance with the requirements of the Joint Convention on Safety of Spent Nuclear Fuel Management and on Safety of Radioactive Waste Management, the IAEA radioactive waste management principles being applied.

At Kozloduy NPP site, a facility was commissioned and licensed for treatment, conditioning and storage of low-level and intermediate-level liquid and solid radioactive waste. This facility is unique in Eastern Europe in terms of purpose and technology. The commissioning of this facility gives a long-term solution of the RAW reliable storage issue and significantly contributes to the environment protection. The achieved reduction factor of the solid radioactive waste volume is about 7.

The RAW generated from the use of radioactive substances in medicine, industry and research is stored at the Novi Han Permanent Radioactive Waste Repository (NHRWR), which is under reconstruction and upgrade.

The safety upgrading of the NHRWR is supported by an IAEA Technical project. For the period 2003-2004, the project focuses on the development of the necessary documents for the NHRWR licensing as well as studies of the "Gabra" site. The NRA actively participates in the process through review of the developed licensing documents, expert missions, etc.

4.6.  Other issues

REFERENCES

Appendix 1

INTERNATIONAL (MULTILATERAL AND BILATERAL) AGREEMENTS

BILATERAL AGREEMENTS

• Agreement between the Government of the Republic of Bulgaria and the Government of the United States of America on Co-operation in the Field of Peaceful Uses of Nuclear Energy.
    •  By way of this Agreement the Contracting Parties reaffirmed their commitment that they would ensure international development in the peaceful utilisation of nuclear energy in compliance with all agreements which to the maximum possible extent contribute to the objectives of the Treaty on non-proliferation of Nuclear Weapons

• Agreement between the Government of the Republic of Bulgaria and the Government of the Russian Federation on Co-operation in the Field of Peaceful Uses of Atomic Energy.
    •  The Agreement reaffirms the Republic of Bulgaria's membership to the United Institute of Nuclear Research in the city of Dubna, regulates the mutually advantageous co-operation of the Parties in the field of peaceful utilisation of atomic energy. The Parties guarantee their strict adherence to their obligations in respect of the Treaty on non-proliferation of Nuclear Weapons and the continued endeavours towards nuclear safety amelioration.
    •  The Agreement covers a rather broad scope of possible joint research domains, such as nuclear physics, controlled thermonuclear fusion and plasma physics, condensed-matter physics (physics of the solids), radiochemistry, radiation chemistry, atomic energy engineering, inclusive of safe and reliable operation decommissioning of nuclear power plants, fuel cycle management, control and issuance of licences, betterment of nuclear fuel storage and transport technologies, prospective nuclear energy sources, nuclear safety and radiation protection, radiological protection from nuclear irradiation, normative and technical documentation, etc.

• Agreement between the Government of the People's Republic of Bulgaria and the Government of the Republic of Greece on Early Notification of a Nuclear Accident and Exchange of Information on Nuclear Facilities.
    •  This Agreement governs the technical aspect of extended operational reporting and notification between the Contracting Parties in case of a nuclear accident after the Convention on Notification in Case of a Nuclear Accident, signed in Vienna on 26 September 1986.

• Financing Protocol between the Government of the Republic of Bulgaria and the Government of the French Republic.
    •  To the end of strengthening the friendly relations that have traditionally linked them, the Government of the Republic of Bulgaria and the Government of the French Republic have agreed to conclude this Protocol with the purpose to contribute to the economic development of Bulgaria. 21/2 million French francs shall be lent to assist financing of the purchase from France of full-scale nuclear power plant simulators and the installation thereof.

• Agreement between the Committee for the Use of Atomic Energy for Peaceful Purposes with the Council of Ministers of the Republic of Bulgaria and the Federal Ministry of the Environment, Protection of Nature and the Reactor Safety of Germany on Issues of Mutual Interest Relating to Nuclear and Technical Safety and Radiation Protection.
    •  The Contracting Parties shall notify and inform each other forthwith and directly of accidents under Article 1 of the Convention on Notification in Case of a Nuclear Accident, signed in Vienna on 26 September 1986. The Agreement also provides for the exchange of information and experience in nuclear and technical safety and radiation protection, favourable co-operation between the Parties and also provides that the Federal Ministry of the Environment, Protection of Nature and the Reactor Safety of Germany shall, upon request, endeavour within the limits of possibilities available under the national law to provide assistance on technical aspects of safety by way of attracting German consulting and expert organisations.

• Agreement between the Government of the Republic of Bulgaria and the Government of Romania on Early Notification of a Nuclear Accident and Exchange of Information on Nuclear Facilities.
    •  The Agreement governs the technical aspect of extended bilateral operational reporting and notification to the Parties in case of a nuclear accident following the Convention on Notification in Case of a Nuclear Accident, signed in Vienna on 26 September 1986.

• Agreement between the Government of the Republic of Bulgaria and the Government of the Argentine Republic on Co-operation in the Field of Peaceful Use of Nuclear Energy.
    •  The Contracting Parties shall collaborate in the development of scientific research and practical utilisation of atomic energy for peaceful purposes. Specific fields of co-operation are listed. Co-operation shall be based on agreements between institutes, organisations and legal entities of the Parties in compliance with the national law.

• Agreement between the Government of the Republic of Bulgaria and the Government of the Republic of Turkey on Early Notification of a Nuclear Accident and Exchange of Information on Nuclear Facilities.
    •  The Agreement shall apply in respect of activities on the subject of notification in case of a nuclear accident after Article 1 and Article 3 of the IAEA Convention.

• Agreement between the Nuclear Regulatory Agency of the Republic of Bulgaria and the Federal Nuclear and Radiation Safety Authority of the Russian Federation on Co-operation in Nuclear and Radiation Safety.
    •  The Agreement provides for exchange of information on the organisation of activities of the regulatory authorities, exchange of regulatory documentation as well as experience in conducting nuclear and radiation safety inspections, training of inspectors, etc.

• Agreement between the Nuclear Regulatory Agency of the Republic of Bulgaria and the Ministry of Environmental Protection and Nuclear Safety of Ukraine on Co-operation in the Field of the State Regulation and Control of Safety in the Use of Atomic Energy for Peaceful Purposes.
    •  The Agreement provides for exchange of information on the organisation of activities of the regulatory authorities, exchange of regulatory documentation as well as experience in conducting nuclear safety inspections, training of inspectors, etc. It also provides for exchange of information on control of the physical protection of nuclear material and facilities and of the system of accounting for and control of nuclear material.

• Agreement between the Committee on the Use of Atomic Energy for Peaceful Purposes of the Republic of Bulgaria and the Ministry of Economy of the Slovak Republic on Co-operation in the Field of the State Regulation and Control of Safety in the Use of Atomic Energy for Peaceful Purposes.
    •  The Agreement provides for exchange of information on the organisation of activities of the regulatory authorities, exchange of regulatory documentation as well as experience in conducting nuclear safety inspections, training of inspectors, etc. It also provides for exchange of information on control of the physical protection of nuclear material and facilities and of the system of accounting for and control of nuclear material.

Appendix 2

DIRECTORY OF THE MAIN ORGANIZATIONS, INSTITUTIONS AND COMPANIES INVOLVED IN NUCLEAR POWER RELATED ACTIVITIES

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1. The statistical tables in this profile have been updated with data as of the end of 2007 from IAEA databases, namely the Power Reactor Information System (PRIS) and Energy and Economic Data Bank (EEDB), and the World Bank's World Development Indicators (WDI).