The national organisation responsible for operating Russia's nuclear power stations, Rosenergoatom, says a "critical situation" has developed at some plants over the non-payment of workers' wages.

In an unprecedented statement issued to NucNet today (Monday), Rosenergoatom gave a detailed account of the financial crisis facing Russia's nuclear electricity sector.

The root cause of the problem is the amount of money owed to the grid by consumers for electricity supplied by the nuclear plants. The total debt exceeded five trillion roubles ($940 million) as of September 1st. This means that the grid company, "United Power System of Russia" (RAO EES), cannot guarantee payments to the nuclear stations for the electricity they produce. Payments made to the plants are in proportion to the money obtained from consumers.

Rosenergoatom said: "These circumstances seriously aggravate the financial situation at nuclear power plants. Absence of wage payments for the plant personnel inevitably leads to the rise of social tension in the working groups, which is directly linked to the stability and safety of the plants."

During July and August, officials of the Ministry of Atomic Power (Minatom) and Rosenergoatom made an attempt to improve the situation. On July 12th, a meeting of the council of nuclear plant managers, chaired by Atomic Energy Minister Victor Mikhailov, decided that wages owed to the plant personnel should be paid off by the end of August.

On the government front, President Yeltsin signed a decree on July 2nd, dealing with the stable operation of the nuclear plants. The decree called on the government to work out and approve by September 1st the basic principles of a federal wholesale electricity market, and to define a mechanism for direct payments from power-intensive consumers for the electricity supplied by the nuclear plants. The president put the government under an obligation to take urgent steps to pay off the wages owed to the plant personnel. Specifically, RAO EES was urged to pay off the debts to all nuclear plants, and submit copies of the relevant documents to the government and Security Council. Pay-off schedules were prepared by the nuclear plants.

"However," adds Rosenergoatom, "the actual critical financial situation at the nuclear plants in July-August has not changed, and the pay-off schedules were broken." By September 1st, RAO EES was due to transfer 82.1 billion roubles to the nuclear plants for April-May wage payments. But according to Rosenergoatom, only 18.6 billion roubles was transferred.

Rosenergoatom said: "In the context of protracted delays with wage payments (over three months), the situation at some nuclear power plants has become critical."

At a trade union conference, held at the Smolensk nuclear station on August 27th, workers declared a "pre-strike situation" and decided to go into dispute with the plant administration. Similar decisions were taken at the Bilibino, Kalinin and Kola plants, and on September 5th, a group of Russian nuclear power workers staged a "warning picket" at the Moscow headquarters of RAO EES.

Ukraine and the European Bank for Reconstruction and Development (EBRD) are expected to conclude a 118 million Ecu package for improvements to Chernobyl nuclear power plant at this week's G7 summit. At the same time, Ukraine will warn that the EBRD's "bureaucratic management" of the Nuclear Safety Account (NSA) and other funds could delay the planned shutdown of Chernobyl by many years.

The package, which both Ukrainian and EBRD officials say is almost agreed, provides for short-term safety upgrades to Chernobyl-3, on-site spent fuel storage and liquid waste treatment facilities. However, in an interview with NucNet, Ukraine's Minister for Nuclear Energy, Viktor Chebrov, criticised the EBRD's recent decision to review the cost effectiveness of completing partially-built nuclear reactors at Rovno-4 and Khmelnitsky-2. He said this could mean that replacement capacity to compensate for the closure of Chernobyl would not be available by 2000.

Ukraine says it will ask the G7 to put pressure on the bank to change the rules for releasing funds for the Chernobyl project - including building replacement nuclear capacity and upgrading existing fossil fuel plants - or to find another organisation to manage the project. Mr Chebrov said that the original decision to complete these reactors had been made by the World Bank and the G7, against the advice of Ukraine. The Ukrainians had proposed that a more expensive gas-fired station should be built as Chernobyl's replacement. He said: "Our joint memorandum with the G7 commits us to finishing these reactors. Since we signed it, we have invested a lot of money in them. If the EBRD will not provide finance, we will do it alone."

However, the EBRD position is that it is acting at the request of the French President and G7 Chairman Jacques Chirac, who asked it in January to consider possible completion of Rovno-4 and Khmelnitsky-2 on the basis of the least cost principle. The NSA, according to the EBRD, applies only to decommissioning operating power stations, not to building new ones. The release of other funds has to be subject to stringent banking criteria.

The Ukrainians have been holding high level meetings with Mr. Chirac to seek clarification of the EBRD's position because, in their view, it does not tally with the spirit of the memorandum. Mr. Chebrov emphasised that even if the EBRD does finally decide to provide financial assistance, the chances of completing construction by 2000 are slim. He explained that the construction team is not being paid and equipment on-site is not being maintained. In a year's time, a new workforce may have to be assembled and much of the existing equipment will have to be scrapped and replaced. This would set the project back well into the next century.

Meanwhile, Chernobyl-1 will close on November 30th. But Mr. Chebrov says Chernobyl-2, shut down after a turbine hall fire in 1991, may be restarted next year. He explained that it would cost much more to make safety upgrades and to recondition unit one than the $60 to $70 million needed to restart unit two. However, reopening unit two would be highly controversial.

Sources: EBRD, Goscomatom, Rosenergoatom, Ukrainian Nuclear Society, ELTA, TEN, NucNet