Turkey's first nuclear power plant likely to be delayed

Tue Oct 8, 2013 7:33am EDT

* Nuclear key to ending Turkey's energy import dependence

* Bureaucracy risks delaying first nuclear plant

* Planned timeline looks optimistic

By Humeyra Pamuk and Orhan Coskun

ANKARA, Oct 8 (Reuters) - Turkey's first nuclear power plant is likely to be delayed by at least a year, a source close to the plans said on Tuesday, as bureaucratic hurdles hamper the $20 billion project.

Prime Minister Tayyip Erdogan has been an advocate of the country's ambitious nuclear programme, meant to help reduce its dependence on costly hydrocarbon imports by providing 10 percent of its electricity needs by 2023.

But its first planned 4,800 megawatt (MW) plant, being built by Russia's Rosatom, is already falling behind schedule, with the first reactor unlikely to be operational by 2019 as planned.

"Production in 2019 is not possible. 2020 is more likely," one source close to the project told Reuters, noting that a nuclear reactor on this scale would need a test period of at least six to 12 months before it could be fully operational.

The start of construction for the Mersin Akkuyu plant in southern Turkey is scheduled for mid-2015 and by 2023 all four planned reactors are meant to have started generating power, but the project has still to obtain a construction licence and has been hampered by other delays over the summer.

An environmental report by Rosatom, which requires approval by Turkish authorities, had to be resubmitted to the Environment Ministry in September, months behind the planned schedule.

Without approval, Atomstroyexport, the main contractor chosen by Rosatom to build the reactors, cannot launch tenders for an estimated $7.5-8.0 billion worth of subcontracts.

The source said he expected the tenders to be launched once the environmental assessment paper was approved, which he predicted would happen by the end of November.

PAPERWORK

A tender by the Turkish Atomic Energy Authority (TAEK) for a firm to review and assess Rosatom's reactor plans to ensure the design meets safety standards has been cancelled several times after bidders failed to meet the pre-qualification criteria.

Aaron Stein, associate fellow at the British defence and security think-tank the Royal United Services Institute, sees this as among the most serious risks to the timeline.

"It all depends on whether they can get their tender documents going and all the indications right now are that they're having extreme difficulties," he said.

"Let's assume they're going to go ahead with construction in 2016, that would still be three years to build one reactor and seven years to build all four. That is really, really fast."

Turkey's power market looks to be alone in Europe in offering promising returns. Electricity consumption rose 5 percent to 242 billion kilowatt hours (kWh) in 2012 and energy demand growth forecasts are second only to those of China.

Turkey needs to add some 3,500 MW of installed power capacity annually to keep pace. Its second planned nuclear plant was awarded in May to a Japanese-French consortium.

Japan's Mitsubishi Heavy Industries Ltd and Itochu Corporation, with France's GDF Suez, will build the 4,800 MW plant at an estimated cost of $22 billion in the Black Sea coastal city of Sinop.

Industry sources have said the first reactor at that plant is slated to come online by 2023. (Editing by Nick Tattersall and James Jukwey)

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