No decision will be made on October 1 regarding the possible nationalization of the nuclear reactors in Belgium operated by energy giant Engie. The Belgian government and Engie have agreed to postpone the deadline for negotiations on a possible takeover until November 4.
According to the joint statement from the Prime Minister, the Ministry of Energy, and Engie, they need more time because of the complexity and scope of the potential transaction.
One-month extension
In April, Prime Minister De Wever announced that the Belgian government and Engie would begin negotiations regarding the potential acquisition of the seven nuclear reactors in Doel and Tihange – Belgium’s entire nuclear fleet. Pending the outcome of these negotiations, all decommissioning activities at the power plants were immediately halted.
A due diligence review, conducted by, among others, the investment bank Rothschild & CO and the consulting firm KPMG, must determine whether the power plants, of which five have already been shut down, can remain open longer, whether that is affordable and reasonable, and whether it is legally feasible.
However, “given the complexity and scope of the proposed transaction, additional time is needed to complete the ongoing analyses and discussions between the parties,” the negotiators said in a joint statement.
Extension of D4, T3, and T1?
According to sources, the debate continues over the current contract for the lifespan extension of Doel 4 and Tihange 3, as well as the funds Engie must contribute toward decommissioning costs.
That latter amount could total 11 to 12 billion euros, but Engie has set aside 8.7 billion for it and intends to stick to that amount. As for the lifespan extension of D4 and T3, the figure under discussion is approximately 2 billion euros.
Meanwhile, it has also come to light that samples were taken from the reactor vessels at Doel 3 and Tihange 2, making a restart of these reactors unlikely.
The De Wever government wants, above all, to keep Doel 4 and Tihange 3 in operation beyond the 2035 extension provided for in the 2023 agreement, namely, until 2045. Energy Minister Mathieu Bihet (MR) is also said to favor a second lifespan extension for Tihange 1, thereby following the advice of the Creg, the federal energy regulator. Still, that option carries less weight with the Flemish parties.
EDF as a potential partner
It is also not yet clear whether the government will operate the nuclear reactors itself or bring in other energy companies, although the latter option seems most likely. To that end, the government is looking, among others, at the French conglomerate EDF.
The De Wever government wants to have 4 gigawatts of nuclear power available in the future. D4 and T3 together provide only 2 gigawatts. To add nuclear capacity, the government is considering small modular reactors (SMRs). Critics say it is too expensive, too slow, and too risky.
In Flanders, the Port of Antwerp is a potential site; in Wallonia, 4 locations are being considered, with the site in Tihange as the primary focus.
The waste management bill is normally financed for the most part
Apart from the negotiations, Engie has also set aside a lump sum of 15 billion euros for future costs of storing and processing nuclear waste, with Engie bearing the volume risk (i.e., more waste means additional costs for Engie).
Tedera, a public institution established by the Belgian government, holds that 15 billion euros. The funds are independent of both the government and Engie. According to calculations by the then-energy minister, it is expected to grow to 60 billion euros over the coming decades and is overseen by the Commission for Nuclear Facilities.
However, if the cost of disposal per unit of waste turns out to be higher, the government will pay the difference – and thus, ultimately, the taxpayer. In any case, with rising energy prices and the ongoing budget talks, it promises to be a “warm” fall for the De Wever government.
