Bulgaria on Wednesday definitively abandoned plans to build the Belene nuclear plant based on Russian technology, saying it would instead build a gas-fired power plant on the Danube River site. Bulgarian Prime Minister Boyko Borisov cited soaring costs as well as a failure to find Western partners for the projects after German company RWE withdrew from the project in 2009.

"It was a hard decision to take," Borisov told reporters on Wednesday. "But we just can’t afford to pay the total cost of the project, which will reach some €10 billion. And there is no way we can make future generations pay.”

A pricing dispute between Russia’s AtomStroyExport, Belene’s prime contractor that was awarded a contract in 2006 to build two VVER-1000 pressurized water reactors, and Bulgaria’s National Electricity Co. (NEK) had stalled the project for years while Sofia sought new financial partners for the project. In October 2011, AtomStroyExport and NEK extended their construction agreement until the end of March 2012.

Meanwhile, Izhorskiye Zavody, which is part of Russian heavy industry enterprise the OMZ Group, last week said it had completed check assembly of a VVER-1000 reactor vessel that had been built for the Belene project and was preparing to deliver it to NEK. Bulgaria had reportedly already paid two-thirds of the reactor’s price, an estimated 1.4 billion levs ($948 million).

Bulgarian Deputy Finance Minister Vladislav Goranov on Wednesday announced on national radio that the reactor meant for Belene would be installed instead at Bulgaria’s Kozloduy nuclear power station, which has two operating reactors. Bulgaria had agreed to pay a final €100 million for the installation of the reactor, he said. The new reactor is not expected to become operational until 2030, by some estimates.

Reuters pointed out that the decision to cancel the project reflects Bulgaria’s center-right government policies, which have essentially sought to abandon major Russian-led energy projects if they are not economically viable or not in the national interest. Euractiv noted that Bulgaria depends on Russia for 89% of its oil, 100% of its natural gas, and all its nuclear fuel.

Sources: POWERnews, Izhorskiye Zavody, Reuters, Euractiv