Deal at Czech Nuclear Power Plant Fuels US-Russia Economic Rivalry

Article excerpt

The nuclear power plant that towers over the green fields outside the small Czech village of Temelin is quickly becoming a frontline in the economic rivalry between the United States and Russia.

Companies with ties to both countries are vying for a contract to build two new reactors at the site, a move that analysts say could open new nuclear energy markets across the region.

"The energy equation has changed.... [Globally] nuclear energy is in decline, says Michal Snobr, an energy analyst at the Czech J&T Bank. "The Temelin contract is not about nuclear energy in the Czech Republic, but about breaking into the European market.

Competing for the tender are two energy companies: Russias Rosatom, and Westinghouse, which is owned by the Japanese Toshiba Group but based in the United States.

For Prague, the proposed expansion of the Temelin plant will help it meet the European Union's guidelines on "diversifying" energy sources and lessening dependence on Russian gas and oil. It is also expected to create thousands of jobs at a time when the Czech economy has been particularly sluggish. At a cost of at least $10 billion, it will be the most costly public project ever in the countrys short history.

For the nuclear industry, that's a bonanza. The tender in the Czech Republic is the most lucrative contract on offer anywhere in the world for the industry, which has suffered a popularity decline in recent years, particularly since the March 2011 accident at Japan's Fukushima Daiichi nuclear power plant.

Opening markets in Europe

In Europe, only France and Finland are constructing reactors and Germany has decided to unplug all 17 of its nuclear reactors by 2022. But the Temelin deal could open new markets in Poland, Hungary, Slovenia, and Bulgaria, Mr. Snobr says.

And politically, it is of great interest to both Moscow and Washington.

"We're not shy about pressing the case for Westinghouse to expand the Temelin nuclear power plant, because we believe that company offers the best option in terms of safety and technology," said then- Secretary of State Hillary Rodham Clinton during a visit to Prague in December.

"It would clearly enhance Czech energy security and it would create job opportunities for Czechs and Americans [and] ensure the new facility would be built to the highest international standards."

Washington has urged the Czechs to do more to generate their own energy, pointing to the fact the country gets 60 percent of its gas and 70 percent of its oil from Russia.

Red flags and spies

The Czech Republics main security agency, Security Information Service, has raised red flags about doing business with Russia, warning in a 2009 report that the Kremlin was using Russian business to infiltrate NATO states with spies. …