15. EURATOM LOANS
(a)
(23974)
14174/02
COM(02)456
(b)
(23979)
14179/02
COM(02)457
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Draft Council Decision amending Decision 77/270/EURATOM empowering the Commission to issue EURATOM loans for the purpose of contributing to the financing of nuclear power stations.
Draft Council Decision amending Decision 77/271/EURATOM on the implementation of Decision 77/270/EURATOM empowering the Commission to issue EURATOM loans for the purpose of contributing to the financing of nuclear power stations.
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| Legal base: | Articles, 2, 172 and 203 EURATOM; consultation; unanimity
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| Documents originated: | (Both) 6 November 2002
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| Deposited in Parliament: | (Both) 19 November 2002
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| Department: | Trade and Industry
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| Basis of consideration: | EM of 5 December 2002
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| Previous Committee Report: | None
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| To be discussed in Council: | Not known
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| Committee's assessment: | Politically important
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| Committee's decision: | Cleared
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Background
15.1 In 1977 the Commission was authorised to borrow
monies and to use them as "EURATOM loans" for any project,
including new construction, relating to nuclear power stations
and to industrial installations in the nuclear fuel cycle in the
European Union. In 1994 the scope of the authorisation was extended
to allow EURATOM loans for improving the safety and efficiency
of nuclear power stations or fuel cycle installations in certain,
listed, non-member countries in Eastern Europe and the former
Soviet Union. The facility concerned has to be in service or under
construction or, where plant modification cannot be justified
in technical or economic terms, loans can be for decommissioning.
Loans in these non-member countries can be up to 50% (compared
with the 20% for projects within the European Union). The ceiling
on total EURATOM loans has been raised from time to time —
on the last occasion, in 1990, to €4,000 million.
The documents
15.2 In document (a) the Commission is proposing to consolidate
the two Council Decisions with regard to the scope of EURATOM
loans - that is, the one authorising loans within the European
Union and the one extending the scope to the listed non-member
countries. This is to ensure that there is equal treatment of
current Member States and those listed non-member countries acceding
to the Union and that it is clear that safety and efficiency issues
are criteria for the eligibility of projects within the Union.
15.3 The total value of EURATOM loans granted and reserved
has approached the level (€3,800 million) at which the Commission
is required to report to the Council. So in document (b) the Commission
is proposing to increase the ceiling from €4,000 million
to €6,000 million to enable it to take forward negotiations
with other prospective borrowers proposing to deal with safety
and efficiency issues. The Commission says the loan facility is
a powerful financial tool for influencing nuclear safety beyond
the European Union's borders in the east, citing successful examples
in Bulgaria and Ukraine.
The Government's view
15.4 The Minister of State for Industry and Energy, Department
of Trade and Industry (Brian Wilson) tells us:
"The Government sees no reason, in principle, for objecting
to these proposals. The existing financial ceiling is close to
being reached making it difficult for the Commission to negotiate
with new beneficiaries. With EU Enlargement in prospect, it is
clearly important that the terms under which the loans are made
available should be standardised between the existing and new
Member States. The Government is satisfied that these proposals
are consistent with its overall policy on nuclear energy as well
as its support for nuclear safety assistance programmes in Eastern
Europe. The Government fully endorses the Commission's intention
to ensure that nuclear safety and efficiency should continue to
be important criteria for the allocation of funding under this
facility."
Conclusion
15.5 We agree that it is important to facilitate projects
to improve nuclear safety and efficiency or to decommission plants.
We clear the documents.
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