Nuclear industry hopes Ukraine crisis to boost business in Europe

Fri Mar 21, 2014 9:09am EDT

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* French, U.S. nuclear industry hopes for nuclear boost

* Czech, Belgian utility executives more sceptical

By Michel Rose

PARIS, March 21 (Reuters) - Western players in the nuclear industry are hoping the conflict between Ukraine and Russia could help push countries in Eastern Europe that rely on Russian gas to turn to atomic energy.

Tension between Russia and the West over the future of Ukraine is spurring the European Union to renew efforts to end decades of dependence on Russian gas, which accounts for about a third of the bloc's supplies.

The nuclear industry, whose prospects were hit by the Fukushima disaster in Japan in 2011, has been keen to promote its advantages as a domestically produced source of clean energy by comparison with imported gas and polluting coal-fired plants.

"I think it is wise for eastern Europe to be evaluating nuclear, because it forces them to be less dependent on external forces, external politics," Donald Hoffman, president of the American Nuclear Society (ANS), told Reuters on the sidelines of the SFEN nuclear industry conference in Paris.

Delegates from the French nuclear industry are also keen to export reactors to central European countries such as Poland and the Czech Republic.

"It (nuclear power) can bring rethinking in terms of energy independence," said Christophe Behar, director of the French nuclear research centre CEA's nuclear energy division.

Moscow has in the past cut supplies to Ukraine when negotiating prices with Kiev, causing shortages for its customers further west, especially in central Europe, which largely relies on Russian supplies to meet its demand.

"The first Ukrainian alert had played a role in energy policy decisions in Britain, for example," said Philippe Knoche, chief operating officer at French nuclear reactor builder Areva.

Britain went on to award a 19 billion euro ($26.4 billion) contract last year to build the first new nuclear plant in Europe since Fukushima to a consortium made of EDF, Areva and Chinese state-owned companies CGN and CNNC.

"In eastern European countries, there could also be a certain number of consequences," said Dominique Miniere, generation and engineering head at French utility EDF.

"Gas doesn't have the same place that they wanted to give it six or seven years ago," he said.

Gas-fired power plants across Europe have been sitting idle for months because of low demand and competition from cheap coal, which has made it more difficult to cut carbon emissions.

NO SHORT-TERM BOOST

But other players were more sceptical on the prospects for nuclear energy in Eastern Europe as a response to the Ukrainian crisis.

"The gas issue is very short-term, I don't see how the nuclear industry could help," said Jean Van Vyve, nuclear assets and projects manager at Belgium's Electrabel, owned by GDF Suez.

These countries' existing heating infrastructure, mainly based on oil and gas and not on electrical devices, reduces the attractiveness of nuclear energy, he added.

Danes Burket, from Czech utility CEZ, did not expect a major boost for nuclear energy either.

"I am not optimistic on that," he said, partly because the EU energy strategy focuses more on supporting renewables than nuclear energy.

"And there is enough shale gas in the U.S. and in case of high prices in Europe, it can be imported. But it depends of course on the U.S. export strategy. Now they want to use the gas for the U.S.," he added.

The European Union has yet to convince Washington to commit to exporting U.S. gas under a transatlantic trade deal. ($1 = 0.7189 Euros) (Editing by Henning Gloystein and Jane Baird)

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