Financing
It is envisaged in the revised National Energy Strategy on October 10, 2002 that Unit 2 of the Ignalina NPP is to be shut down by 2009 provided that financial sources are available and the necessary funding based on agreements with EU institutions and other donors. Lithuania committed herself to shut down the reactors considering that at later stages of EU accession negotiations the issue of additional financial support for the premature closure of Unit 1 at INPP by 2005 and Unit 2 by 2009 was adequately dealt with.
The EU members have admitted that the decommissioning of INPP will take longer than the present financial prospects allow and that it is an excessive financial burden to Lithuania incommensurable with its size and economic power. The EU countries declared that being solidarity with Lithuania they are prepared to continue additional financial support of the EU for the decommissioning efforts after Lithuania becomes a member of the EU.
It is a usual international practice to raise the price for electricity generated at a NPP gradually and thus accumulate the so-called closure fund over the years of its operation. This is the best way out. However, during the first 10 years of INPP operation neither electricity prices were raised nor funds were accumulated. Only since 1995 funds for the INPP decommissioning have been started to deposit in the National SE Ignalina Decommissioning Fund – after the whole electricity price was slightly raised. However, the amount accumulated in the National Decommissioning Fund is insufficient, therefore, it is planned to finance decommissioning from other funds.
INPP decommissioning program has been financed from the EU Funds for Ignalina NPP decommissioning, Ignalina International Decommissioning Support Fund, SE Ignalina NPP National Decommissioning Fund, targeted specific grants from Lithuanian state budget for municipalities allocated in INPP region, approved general appropriations and other sources for the relevant ministries and other public authorities responsible for implementing the decommissioning program.
Lithuanian Government according to the Protocol No. 4 of the Act of Accession of Lithuania to the European Union and having regard to the INPP decommissioning process, negotiates with European Commission on more adequate financial support in order to ensure appropriate and safe INPP decommissioning process.
On 20-21 June 2000, the conference of international donors who have decided to finance decommissioning projects of Unit 1 of INPP took place in Lithuania. Representatives from European Commission, the G-7 countries, international financial organizations participated in the conference. In 2001 the Ignalina International Decommissioning Support Fund (IIDSF) was established, administered by the European Bank of Reconstruction and Development (EBRD). IIDSF funds and/or co-funds chosen technical decommissioning projects and energy sector measures which are important for the final closure of INPP.
Approval of project funding depends on IIDSF Donor Assembly’s decision. Donor Assembly governs the Ignalina International Decommissioning Support Fund. Donor countries – Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Luxembourg, the Netherlands, Norway, Poland, Spain, Sweden, Switzerland and European Commission. The Assembly has the competence to change the content of the projects.
The pledged funds for the INPP decommissioning process in 1999-2013 are estimated as 1 588, 5 million EUR. The national decommissioning funds of the Republic of Lithuania are estimated as 188, 6 million EUR.
Abbreviations:
CPMA – Central Project Management Agency
EBRD - European Bank of Reconstruction and Development
IIDSF – Ignalina International Decommissioning Support Fund
Comment: 2010-01-01 Special Ignalina Management Program was 11.9 million EUR.
Resources: Ministry of Energy of the Republic of Lithuania, Central Project Management Agency, 2010-04-23.
Ignalina NPP decommissioning activities are co-financed by European Union