UKRAINE 782 UKRAINE

1. GENERAL INFORMATION.

1.1. General Overview

Ukraine is a sovereign state in Eastern Europe. It has its own territory, higher and local bodies of State power (the Supreme Rada and Local Soviets), Government, national emblem and a state flag). The capital of the Ukraine is Kiev, which has a population of about 3 million. There are 24 administrative regions and Crimean autonomous republics in Ukraine. Ukraine is bounded on the north by , on the north-east by the Russian Federation, on the west by Poland, Slovakia, on the south- west by Hungary, Romania, and Moldova, and on the south by the and the Sea of Azov.

The total area of Ukraine is 603,700 square km. The area spans from west to east 1,300 km and from north to south 900 km. Ukraine's state border extends for a total of 7,698 km: with - 2,484 km; Belarus - 952 km; Romania - 608 km; Poland - 542 km; Slovakia - 98 km; Hungary - 132 km; Moldova - 1,194 km. The total length of Ukraine's sea coast is 1,758 km (Black Sea - 1,533 km; Sea of Azov - 225 km).

Ukraine has a moderate-continental climate; in the southern most region of the Crimea the climate is sub-tropical. The largest river of Ukraine is the Dnipro. Its length is 2,201 km, of which 981 km flows through Ukraine. The largest mountainous area (the Carpathian Mountains) in Ukraine is more than 270 km long and about 100 km wide. The highest peak is the Hoverla (2061 m).

The population of Ukraine is about 50.1 million (Table 1): 80% of the population is Ukrainian, the remaining 20% is Russian, Belarussian, Jew, Crimean, Tatar, Moldavian, Polish, Hungarian, Rumanian, Greek, German, Bulgarian or representatives of other numerically small nationalities. The urban population comprises 68% of the total population and the population density is 83 people per square km.

TABLE 1. POPULATION INFORMATION Growth rate (%) 1980 1960 1970 1980 1990 1996 1997 1998 to 1998 Population (millions) 42.5 47.1 49.9 51.8 51.3 50.4 50.1 0.02 Population density (inhabitants/km²) 69 78 83 86 85 84 83 0.0 Urban population as percent of total 47 55 62 67 68 68 68 0.5 Predicted population growth rate (%) 1998 to 2000 0.0 Area (1000 km²) 603.7 Source: IAEA Energy and Economic Database; Country Information.

The Ukraine is one of the largest republics of the former Soviet Union. As a constituent member of the USSR, the Ukrainian republic, in accordance with the Soviet Constitution, formally enjoyed certain rights and features of a sovereign state: territory, organs of state power and administration, budget, state emblem, flag, national anthem, and Constitution. In 1944, in accordance with a decision of the Supreme Council of the USSR, the Union republics, including the Ukrainian SSR, were granted the right to conduct their own foreign relations. One year later the Ukrainian SSR became a founding member of the United Nations. Despite its dependence on Union decision and structures, the international status of Ukraine as a state in its own right increased over the years. During the period of 1944-1990, Ukraine was a signatory of 156 international treaties, a member of 16

UKRAINE 783 international organizations, and participated in the work of approximately 60 permanent and interim international organs.

On July 16, 1990 the Supreme Soviet of Ukraine adopted an important historic document - the Act proclaiming Ukrainian state sovereignty, independence and indivisibility of power within the boundaries of Ukrainian territory, and independence and equality in conducting foreign relations. On 24 August, 1991 the Supreme Rada, in effecting this Declaration and proceeding from the right to self- determination, proclaimed the act of independence of Ukraine. Its territory was proclaimed indivisible and inviolable and the Constitution and laws of Ukraine have exclusive validity. On December 1, 1991 an all-Ukrainian referendum was held. Results of this national referendum indicated that more than 90% of the population favoured independence. Leonid Kravchuk, the former head of the Supreme Rada of Ukraine was elected .

On the 28th of June 1996 a new Constitution was adopted in accordance with which Ukraine was proclaimed an independent republic consisting of the autonomous Crimea Republic and 25 administrative regions. The leader of the State is a president of Ukraine who acts on behalf of the State. He is elected by citizens of Ukraine on the basis of the universal, equal and direct voting through secret election for the 5 years period and not more than for 2 successive terms. The uniform legislative authority is a Parliament - of Ukraine (Supreme Soviet of Ukraine). The higher level of the executive authority is the Cabinet of Ministers of Ukraine. The Ukrainian is only source of power, the possessor of the power and sovereignty in the State. The main national holiday is the Independence Day, 24th of August, when the independence of Ukraine was proclaimed.

1.2. Economic Indicators

Table 2 shows the historical Gross Domestic Product statistics.

TABLE 2. GROSS DOMESTIC PRODUCT (GDP) Growth rate (%) 1992 1992 1993 1994 1995 1996 1997 1998 to 1998 GDP(1) 24,197 32,666 37,973 37,011 44,558 50,150 42,052 31.8 GDP(2) per capita 473 597 731 720 872 989 836 33.0 GDP by sector (%): -Agriculture 20 20 15 15 13 14 14 -16.3 -Industry 42 28 38 34 31 28 28 -18.4 -Services 31 45 40 43 49 51 52 29.5 -Construction and Utilities 7 7 7 8 7 7 6 -7.4 (1) Millions of current US$. (2) Current US$ per capita. Source: IAEA Energy and Economic Data Base; Country Information.

1.3. Energy Situation

The fuel-energy complex (FEC) of Ukraine consists of the 2 economically independent sectors: power sector and fuel industry. The fuel industry covers the whole process related to the natural fuel and its reprocessing, both process are performed by the , gas and oil processing industries, moreover by the peat and nuclear industries. FEC is a comprehensive, complex intersector system for mining and production of fuel and power, their transportation, distribution and utilization.

784 UKRAINE The main organic primary energy source of Ukraine is coal, brown coal or lignite. Total reserves of coal account for 94.5% and those of brown coal total 5.5%. Based on general assumptions that the total coal reserves in Ukraine account for about 300 billion t, a new “concept of the structural reform in the Ukrainian coal industry under the market relation development conditions” was prepared by the Ukrainian Ministry for Coal Industry in 1999. In this concept the actual capabilities of the branch is assessed to be 100 M ton. As the heat generation capacities amount 4500-5000 Kcal/kg (18.7-20.8 joule/kg) such volume of mining is equivalent to 64.3-71.4 M ton of the equivalent fuel that accounts for 21.4-23.8% of the overall demand of Ukraine for the primary fuel-energy resources. Ukraine imports the coal partially from Poland, Russia and Kazakhstan.

The uranium ore deposits are vital for improving the level of the Ukraine’s power self-supply. The Vostochny mining and processing industrial complex (located in Zhovty Vody, Dnepropetrovsk region) is the only Ukrainian enterprise intended for uranium ore mining and concentrate production. The future prospects and development of the industrial complex as well as the Uranium ore mining industry in Ukraine is closely related to the industrial commissioning of Novokonstantinovsky uranium ore deposit.

Under the current levels of the power consumption and utilization and in order to meet in full our country’s needs for energy sources, it is necessary to import annually up to 20 M t of coal, 28 M t of oil and up to 70 Billion m3 of .

Ukraine is an industrial and agricultural state, rich in coal, iron ore, manganese, nickel, and uranium deposits. Its major industries are: metallurgy, mining (24.4 M t of steel and 77 M t of coal per year), electric power sector (172 TWh of electric power), chemical, manufacturing industries, machinery building and ship building, food and textile industries, and etc. Ukraine produces 27 M t of grain, 2 M ton of sugar, 1.7 M ton of meat per year. Total area of the sown area totals 29 M hectare. Ukraine has well-developed transportation and communication systems.

The historical energy supply and demand data are given in Table 4. The drop of the electric power production and coal mining is keeping on (Tables 5.1 and 5.2). At the same time, the import of the energy sources decreased. These facts lead to a lower supply of energy resources to the national economy . Table 6 shows the specific fuel consumption by the various sectors.

The five plants in the Ukraine accounted for some 44% of all electrical power in the republic with 47% supplied by coal, oil and gas, and 9% from hydroelectric facilities at 1998.

Certain aspects of the Ukrainian economy are weak: its ecology is in a precarious state, there is extensive loss of soil fertility, Ukrainian plants are outfitted with outmoded industrial equipment, there are many structural defects in the national economic complex, the service industries are underdeveloped, and there is an excessive emphasis on heavy industry and production. These problems may be resolved quickly owing to a highly-trained work-force, well-developed communications and distribution systems, favourable climate, and opportunities to develop tourism, transit systems, and investments.

UKRAINE 785 TABLE 3. ENERGY RESERVES Exajoule Estimated energy reserves in 1993 Solid Liquid Gas Uranium (1) Hydro (2) Total Total amount in place 2.46 0.042 0.238 0.049 0.003 2.79 Estimated energy reserves in 1996 Total amount in place 971.69 9.11 37.85 24.90 N/A 1068.86 (1) This total represents essentially recoverable reserves. (2) For comparison purposes a rough attempt is made to convert hydro capacity to energy by multiplying the gross theoretical annual capability (World Energy Council - 1996) by a factor of 10. Source: IAEA Energy and Economic Data Base; Country Information.

TABLE 4. ENERGY STATISTICS Exajoule Average annual growth rate (%) 1990 1970 1980 1990 1991 1992 1993 1994 1995 1996 1997 1998 to 1998 Energy consumption - Total(1) N/A N/A N/A N/A 3.44 2.94 2.47 2.31 2.17 1.9 1.8 - - Solids(2) N/A N/A N/A N/A 0.98 0.87 0.61 0.59 0.48 0.44 0.42 - - Liquids N/A N/A N/A N/A 0.40 0.23 0.24 0.20 0.18 0.17 0.18 - - Gases N/A N/A N/A N/A 1.16 1.01 0.89 0.83 0.86 0.79 0.73 - - Primary electricity(3) N/A 0.72 0.89 0.87 0.81 0.74 0.65 0.62 0.56 0.54 0.51 - Energy production - Total 2.76 2.92 2.59 2.27 2.12 1.89 1.64 1.53 1.40 1.42 1.40 -7.40 - Solids 1.43 1.37 1.14 0.94 0.93 0.80 0.66 0.58 0.49 0.53 0.53 -9.13 - Liquids 0.19 0.10 0.07 0.07 0.06 0.06 0.06 0.05 0.05 0.05 0.05 -4.12 - Gases 0.65 0.60 0.30 0.26 0.22 0.20 0.19 0.19 0.20 0.19 0.19 -5.55 - Primary electricity(3) 0.50 0.85 1.08 1.00 0.91 0.83 0.73 0.70 0.66 0.64 0.62 -6.70 Net import (import - export) - Total(4) N/A N/A N/A N/A 1.35 2.21 2.50 4.94 N/A N/A N/A - - Solids N/A N/A N/A N/A -0.01 0.00 0.01 0.06 N/A N/A N/A - - Liquids N/A N/A N/A N/A 0.41 0.00 0.00 0.09 N/A N/A N/A - - Gases N/A N/A N/A N/A 0.95 2.21 2.49 4.79 N/A N/A N/A - (1) Energy consumption = Primary energy consumption + Net import (Import - Export) of secondary energy. (2) Solid fuels include coal, lignite and commercial wood. (3) Primary electricity = Hydro + Geothermal + Nuclear + Wind. (4) Electricity losses are not deducted. Source: IAEA Energy and Economic Data Base; Country Information.

TABLE 5.1. DOMESTIC ENERGY PRODUCTION

Resource 1998 1997 1996 1995 1994 1993 1992 Electricity (TW·h) 172 178 183 194 202.9 229.9 252.5 Oil, including gas condensate (mln ton) 3.9 4.1 4.1 4.1 4.2 4.2 4.5 Natural Gas (bln cubic metre) 17.9 18.1 18.4 18.2 18.3 19.2 20.9 Coal (mln ton) 77 76.9 70.5 83.8 94.6 115.8 133.7 Source: Country Information.

786 UKRAINE TABLE 5.2. DOMESTIC ENERGY PRODUCTION IN 1994 AND GROWTH RATES

Resources 1998 98 vs. 97 97 vs. 96 96 vs. 95 95 vs. 94 94 vs. 93 93 vs. 92 (%) (%) (%) (%) (%) (%) Electricity (TWh) 172 -3.4 -2.7 -5.7 -4.4 -11.7 -9.0 Oil, including gas condensate (mln ton) 3.9 -4.9 0.0 0.0 -2.4 1.2 -6.7 Natural gas (bln cubic metre/) 17.9 -1.1 -1.6 1.1 -.06 -4.7 -8.2 Coal (mln ton/) 77 0.1 9.1 -15.9 -11.4 -18.4 -13.4 Source: Country Information.

TABLE 6. SPECIFIC FUEL CONSUMPTION

1994 Fuel type Total in Sector (%) Ukraine Industry Construction Agriculture Transport Coal, 106 ton 88.5 86.5 0.4 1.3 0.8 Gas, 109 m3 83.6 66.9 0.9 2.2 4.1 Oil and Gas condense, 106 ton 18.3 100 - - - Crude oil, 103 ton 8947.4 88.6 1.2 1.5 3.9 Furnace Fuel domestic use, 103 ton 208.8 27.2 4.6 16.8 5.7 Peat, 103 ton 902.8 96.3 - 0.2 0 Firewood for heating, 103 m3 2567.7 32.8 0.4 13.2 1.7 1996 Fuel type Total in Sector (%) Ukraine Industry Construction Agriculture Transport Coal, 106 ton 69.3 90.9 0.3 0.9 1 Gas, 109 m3 80.5 58.5 0.4 1.2 5.4 Oil and Gas condense, 106 ton 13.7 99 0.1 0 0 Crude oil, 103 ton 5223.9 87.5 1.1 0.8 6.6 Furnace Fuel domestic use, 103 ton 14.8 33.1 13 12.4 4.2 Peat, 103 ton 875.7 98.9 0 0.9 0.1 Firewood for heating, 103 m3 2261.3 26.6 0.5 14.5 1.9 1998 Fuel type Total in Sector (%) Ukraine Industry Construction Agriculture Transport Coal, 106 ton 60.8 89.6 0.2 0.5 0.7 Gas, 109 m3 71.1 53.9 0.3 0.7 6.4 Oil and Gas condense, 106 ton 13.7 99.0 0.1 0.0 0.0 Crude oil, 103 ton 3381.9 88.4 1.2 0.6 4.1 Furnace Fuel domestic use, 103 ton 87.8 36.4 12.1 9.3 5.7 Peat, 103 ton 527.5 96.3 0.0 0.0 - Firewood for heating, 103 m3 2484.3 5.2 0.4 3.9 0.6 Source: Country Information.

1.4. Energy Policy.

The current energy industry of Ukraine is based on the primary energy power sources as follows: oil, natural gas, coal and .

UKRAINE 787 The “National Energy Programme of Ukraine for the period till 2010” (NEP) has established the energy policy of Ukraine and its top priorities. This programme approved by the Verkhovna Rada (Parliament) on May 15, 1996 includes the main tasks as follows:

· solution of the problems related to the stable and reliable supply of the fuel and energy resources in order to meet the Ukraine’s demands; · decrease in the foreign economic dependence on the fuel and energy resources; · wide and large-scale implementation of the energy saving technologies; · expansion of utilization of non-conventional energy sources; · decrease in harmful effect on the environment of the fuel-energy complex’s sectors; · expansion of a share of extra budgetary sources of the programme financing due to the budgetary deficit and because of the market relations development; · development of own basis for the machinery building to meet the fuel-energy complex’s needs and etc.

In accordance with NEP of Ukraine the import of energy sources is planned to decrease by 69 Mt compared with 1990. Till 2010 the coal mining has to increase up to 170 Mt that will allow to ensure and meet the needs of Ukraine for the solid fuel. Our own extraction of oil is expected to increase up to 7.5 M t, and that of natural gas- up to 35.3 Billion m3 in 2010.

2. ELECTRICITY SECTOR.

2.1. Structure of the Electricity Sector.

Electric power sector of Ukraine is the centralized industry that supports and ensures the functioning and operation of national economic complex and private life of the population. Based on the technology and their purposes all electric power plants are divided into the nuclear power, thermal power and hydro electric power plants. In Ukraine the electric power is generated and supplied by high-capacity NPPs, TPPs and HPPs that are united into the Unified Energy System. As of January 1st, 1999 the total installed capacity of electric power plants was 53.9 GW(e). In 1998 Ukraine produced electricity totalling 173TWh , including 75.2 TWh produced by NPPs , 81.9TWh produced by TPPs, 15.9 TWh generated by HPPs. The principal or main electricity consumers in the country are the industry and construction sectors.

In compliance with the President’s Decree on “Measures on market reforming in the electric power industry of Ukraine”, adopted on 21 May 1994, it is foreseen: i) to retain the unified, Joint Electric Power System of Ukraine as guarantee of reliable electric power supply to consumers in all regions of Ukraine; ii) to avoid the privatization of either the main electric power transmission lines or the dispatching management in the electric power sector; iii) to establish an independent (state) supervision body for tariff adjusting and consumer’s right protection and for tariff changing policy; iv) to create a competitive electric power market for ensuring reliable conditions for the operation of power plants; v) to attract participation of local self-control bodies for elaboration of retail tariffs and development of local power industry; vi) to attract investments (including foreign ones) for development of the power industry; to prevent a loss of highly qualified staff in the industry, which has become a serious problem, caused by the substantial difference in labour payment rates in Ukraine and in Russia.

The status of the electric power sector in Ukraine can be defined by the following facts:

788 UKRAINE · During the last 15 years the main growth of the generating capacity of the power system of Ukraine has been ensured by the large and comprehensive development of . In the total installed electrical capacity, the Ukrainian NPPs accounted for 25% (13.8 GW(e)); · the fast development of nuclear energy resulted in the curtailment of the development of fossil fuel plants. In the 1980s, only the generating capacities at the hydroelectric plant in Zuevo (1,200 MW(e)) and at the fossil power plant-5 (470 MW(e)) in Kharkov have been commissioned; · in the period of the large development of the nuclear industry, the volumes of funds and technical support that have been allocated for the fossil power, were considerably reduced; · the long-term operation of the thermal power plants without renewing the main funds, low quality (non-designed) fuel utilization and the intensive use of the thermal power plants in the base load mode. All these facts resulted in the wear of the equipment (on average, the wear topped the target by 50% and at the separate thermal power plant of the Donetsk region, the wear topped by 70-80%); · the deterioration of the environmental situation in the region by thermal power plants has increased; · the electric power supply to the consumer has been provided under the conditions of a critical deficiency in fossil fuels; · the balance of the output and power is characterized as intensive or strained, that is caused by the large capacity gaps and by the fuel resources deficit. Practically, on-line spare capacities are absent in the system; · the production basis is underdeveloped in the field of the sector power and energy and technology support.

In order to reform the electric power sector and to create an electricity market the several Western advisors or consultants have been involved suggesting to take the UK electricity market’ model as a basis. In 1994 the President signed the Decree 1244/94 that allowed for restructuring of the energy company. In 1995 the new power generating companies were established replacing previously existing eight regional companies (associations) that had combined the generation and distribution activities. At that, the power supplying companies were established in each region of Ukraine as well as in Kiev and Sevastopol. Next year the Ukrainian NPPs entered the whole sale electricity market through the NNEGC “”. The main principle of reforms became the separation of the electricity production from its distribution. So, the generating companies have been expected to supply the electricity to the Electricity market, and the latter would supply it to the regional power supplying companies and to regional and independent suppliers with the subsequent sale of electricity to consumers.

Circuit of accounts for used electricity provides grounds for formation Regional Power Supply Companies - «Oblenergo» (Figure 4) with a various share of state and private capitals. Ukrainian National Regulation Commission for Power Industry (UNRCPI) carries out state regulation of mutual relations between Energy Generating Companies and consumers. UNRCPI was establish as an independent and separate standing body for government regulation of business activity in the power industry, formulating and implementing a uniform government policy on development and operation of the electric power market in Ukraine. The Commission’s major objectives are:

· participation in formulating and implementing the government policy on the wholesale electricity market and gas/oil/oil products markets · government regulation of business activity by natural monopoly entities in the energy sector and gas/oil industry · competition promotion in the , electricity and gas supply, oil and gas extraction, oil/oil products and gas storage and sale. · support to implementation of pricing/tariff policy in the energy sector and gas/oil industry

UKRAINE 789 · support to goods markets in order to them to operate effectively with due balance of the public, natural monopoly and consumer interests, and their goods and services · consumer protection, etc.

In 1996 all these relations were ensured by the Electricity market contract. Despite all its seeming simplicity the UK model of the electricity market represents one of the most complicated model to be established. This requires 100% cash payment. During its implementation our national electric power generator lost the control over the distribution of his product and did not received anything instead as a compensation. Under the current conditions in Ukraine that situation has doomed the system to non-payments from the very beginning. About two third of the Ukrainian products have not been not competitive and the electricity supplied has not been paid. When the barter has been used as a payment , the whole sale electricity market could not operate properly. The functions of the whole sale electricity market came to a simple registration of barter transactions. This did not sell anything and as a result could not impact on anything. The only serious and important sources of ready money were assets of population that paid for the electricity on fixed tariff. Such a situation could remain for several years only because of additional source of outside “feeding”: the Whole sale electricity market was supported by the two sources - the budget and free fresh nuclear fuel supplies. The stumbling- block for the whole sale electricity market is a direct contract with the consumers. From the point of view the Whole sale electricity market’ policy this is inadmissible , but in reality, the assets are attracted this way. The reforming of electricity market is inevitable due to the objective reasons: such a situation can not exist for a long time when a half of electricity is sold based on some rules, and an other part of electricity is sold based on rules quite different.

Figure 1 shows the structure of electric power sector of Ukraine, Figure 2 shows the diagram of the electricity market of Ukraine, and Figure 3 presents the list of the power generating companies of Ukraine, Figure 4 lists of the electricity distribution companies of Ukraine.

Ministry of Power Industry

Power generating Ukrenergo Power Supply Companies National Energy Company Companies Power Energorynok Industry Special Systems Separate Section

Branch's Nuclear scientific Power Plants design and engineering organizations Thermal Power Plants

Energostroy State State Joint-Stock Hydraulic Company Power Plants

Other Establishments and Enterprises

FIG. 1. Chart of the administrative management of Ukrainian electric power sector (by state on the end of 1999)

790 UKRAINE Transmission Lines

electricity net of NEC* electricity net of Oblenergo

AC** 220-750 kV AC** 110 kV

AC** 35-10-6 kV

AC** 0,4 kV

NEC* - National Energy Company "Ukrenergo" AC** - alternating current

FIG.1a. Distributions Lines (by state on the end of 1999)

Administared tariff

Power Supply Companies Consumer

Electricity generator* Energy Market** Supplier *** Consumer

Electricity sale Electricity sale Independence Consumer on generation on gross Supplier cost cost Consumer

Unadministared tariff Consumer

Electricity generator* which gets a licence on implementation of entrepreneurial activity on electricity generation (Energy Generating Companies)

Energy Market** State Enterprise "Energorynok" which has a licence on implementation of entrepreneurial activity on gross electricity supply

Supplier *** which had recieved a licence on implementation of entrepreneurial activity on gross electricity delivery with Administared / Unadministared tariff

FIG. 2. The Electric Power Market in Ukraine (by state on the end of 1999)

UKRAINE 791 Electricity generetor (Power Generating Companies)

1.NNEGC"Energoatom" 2.Dniprenergo 6.Dniprohydroenergo Zaporozhye NPP Zaporozhye TPP Kyiv HPP South Ukraine NPP Prydniprovska Kaniv HPP Rovno NPP Krivorizka Êremenchuk HPP Chernobyl NPP Dniprodzerzhynsk HPP Khmelnitsky NPP 3.Donbassenergo HPP Zuivska Kakhovka HPP Lugansk Sloviansk Starobesheve 7.Dnisterhydroenergo Kurakhove Dnister HPP

4.Zahkhidenergo Burshtyn Dobrotvor Ladyshyn

5.Tsentrenergo Vuglegirska Trypilia Zmiiv

FIG. 3. Structure of Power Generating Companies

Supplier (Power Supply Companies)

1.South-West Power System: 3.Donbas Power System: 5.Krym Power System: 7.South Power System: Vinnytsiaoblenergo Donetskoblenergo Krymoblenergo Mykolaivoblenergo Ternopiloblenergo* Luganskoblenergo* Sevastopoloblenergo Odesaoblenergo* Khmelnytskoblenergo Khersonoblenergo* Chernivtsioblenergo

2.Dnieper Power System: 4.Central Power System: 6.West Power System: 8.North Power System: Dniprooblenergo Kyivenergooblenergo Volynoblenergo Poltavaoblenergo* Zaporizhiaoblenergo Kyivenergooblenergo Zakarpatiaoblenergo Sumyoblenergo* Kirovogradoblenergo* Chernigivoblenergo* Prykarpatiaoblenergo* Kharkivoblenergo Cherkasyoblenergo Lvivoblenergo* Zhytomyroblenergo Rivneoblenergo

* - Public Limited Company FIG. 4. Structure of Power Supply Companies

2.2. Decision Making Process

According to NEP («National Energy Programme of Ukraine for the period till 2010») the following main measures and activities on the prospective development of electric power must be undertaken: i. implementation of energy saving measures; ii. orientation towards a Ukrainian fossil fuel base (coal): the refurbishment of a fossil fuel balance focused on increasing the share of coal in the electric power production and on decreasing the natural gas and crude oil utilization;

792 UKRAINE iii. development of the nuclear industry in the future, taking into account the present deficiency in fossil fuel in Ukraine. Ukraine is planning to commission 2 units with a high priority at Khmelnitsky and Rovno and 2 units with a medium priority at Khmelnitsky; iv. the commissioning of new hydropower capacities is foreseen at Dnestr and Kanev, taking into account the deficiency of the hydropower plants whose capacity can be changed; v. a primary task comprises the technical upgrading and rehabilitation of thermal power plants in order to extend their plant life to an additional period of 15 to 20 years and to improve their environmental and economic conditions. Before the year of 2000, the rehabilitation of thermal power plants shall be carried out by means of replacement of components and parts of turbines and boilers. After 2000, upon creating new boiler types and new technologies, it is intended to carry out a comprehensive technical upgrading in which the major equipment will be replaced with a more economical and environmentally friendly one.

In order to provide rehabilitation and technical upgrading of thermal power plants it is required to raise funds. However, the funds raised by means of tariff escalation will not be sufficient, unless other financial sources from outside, including those obtained as a result of establishment of stock-holding companies and privatization of thermal power plants, are provided.

2.3. Main Indicators

By yearend 1998, the installed capacity of all electric power plants was 53.9 GW(e), i.e.:

- nuclear power plants 12.8 GW(e) (about 23.8%); - thermal power plants 36.4 GW(e) (67.5%); - hydro power plants 4.7 GW(e) (8.7%) .

Table 7 and Figure 5 show the historical electricity production and installed capacity data. Figure 6 shows a comparison of the electricity generation by fuel types in 1995 and 1998.

The specific character of power production and consumption permits the presence of a high power intensive industry. However, this industry considerably depends on the primary energy sources supplied from Russia (e.g. coal, oil and gas), Poland (coal) and Turkmenistan (gas). Due to the economic difficulties mentioned in section 1.3, the considerable drop in the electric power production from 298.5 TWh in 1990 to 173 TWh in 1998 has lead to a redistribution of the consumption structure toward the domestic services industry.

100% 90% 80% Nuclear 70% Hydro

60% Gas 50% Oil 40% Coal 30% 20% 10% 0% 1995 1996 1997 1998

FIG. 5. Electricity Generation by Type of Fuel (%)

UKRAINE 793 1995 1998

Nuclear Coal Nuclear Coal 33,5% 34% 42,5% 25,5%

Oil Hydro Oil 2,7% Gas Gas 4,8% 4,6% Hydro 23,1% 20,3% 9%

FIG. 6. Comparison of Electricity Generation by fuel type (1995 and 1998)

As of December 31, 1998 the gross installed capacity of power plants in Ukraine was 53,9 GW. It include 48,8 GW of those managed by Ministry of Power Industry (Minenergo) and others, so- called block-units, that are managed by local authorities or make part of some other enterprises (8.7% hydro, 23.8% nuclear and 67.5% thermal power plants).

Total electricity production in 1998 was 172.8 TWh (hydro: 9.3%, nuclear: 43.5%, and thermal: 47.2%). The maximum electricity production in Ukraine was 298,5 TWh in 1990, one year before the Soviet Union crashed. Electricity production in kWh/per capita decreased from more that 5762 in 1990 to less than 3,500 in 1998. Electricity export was 10.7 TWh in 1998 in compare to 43.8 TWh in 1990. For the end consumption was used 142.1 TWh.

Demand, particularly in heavy industry, has been falling as a result of the severe economic recession and, according to international estimates, is not expected to regain 1990-levels before 2010- 2015, with a shift away from industrial consumption and increases in the municipal service and population. This gloomy scenario does not appear to be accepted by top officials in Ukraine, where concern over large-scale energy shortages have been a major argument in discussions about present and future of Ukrainian fuel-power complex.

The national electricity supplier is the Ministry of Power Industry (Minenergo). It owns and operates the transmission and distribution systems and some 97% of the country’s generating capacity. The Ministry is also responsible for the design and construction of power plants. Heat produced by Minenergo for district heating distributes by the State Committee of Communal Services.

Minenergo is experienced difficulties in obtaining payment for electricity supplied. Press-center 1 of the Ministry reported that in September 1999 close to 6649 mln UAH or US $1,445 M remained unpaid (notes: consumers, practically, did not pay for 6 months consumption of electricity) and only 18,3% of electricity produced in January-September 1999 have been paid through banking remittance. Electricity consummated was partly paid through barter. About quarter of generated power was not paid. As to the end of September 1999 payable notes of the Ministry (debt of debtors) are 11,229 mln UAH (US $2,441 M). The same times the Ministry should pay to creditors 13,743 mln UAH (US $2,987 M). Practically the Ministry described itself as essentially bankrupt.

Current electricity tariffs do not cover average costs let alone leave a margin for investments, which means that the power industry is dependent on state funding for renovation and development.

1 UAH - hrivna, Ukrainian currency

794 UKRAINE Moreover, deduction to the NPPs decommissioning fund, radwaste management, nuclear liability does not include in electricity tariff. According to the Ministry in 1998 the average tariff of electricity generated by all power plants was 6.82 kopeks/kWh (about 3.4 US cents), in particular (in US cents/kWh): TPPs-3.72; NPPs-1.61; HPPs-0.295; WPPs-11.25. Last two years rules of electricity selling to end consumers and prices of electricity changed many times.

At the beginning of September 1999 more then 214 mln UAH (US $46.5 M) salary was not paid to the personnel of the power industry.

All problems connected to acquisition of fuel for power generation is strictly tied with financial resources. Fuel supplies to TPPs are made from both the Ukrainian sources and from Russia and Poland (50% domestic and 50% from abroad). The situation is aggravated by the fact that in 1998 all reserves of nuclear fuel supplies on a compensation basis (against nuclear warheads returned to Russia) were exhausted. As results Ukraine need find additionally more than US $200 M to pay 2 Russia for fresh nuclear fuel .

The poor financial conditions resulted in shortage of fossil and nuclear fuel and decreasing quality of power plants maintenance. It led, as consequences, to unreliability in electricity supply to all sectors of the economy. There have been problems stabilizing the grid at 50 Hz (all 1998 long the electric current frequency in the grid was maintained at 49.2-49.4 Hz) that resulted in periodic disconnection of Ukraine national grid with its neighbor’s grid.

As of January 1, 1999, the Ukrainian TPPs counted 104 units of a 100 MW and higher capacity. There are: six of 150 MW units (were commissioned in 1959-1964); forty three of 175 to 210 MW units (were commissioned in 1960-1975); forty two of 282 to 300 MW units (were commissioned in 1963-1988); five 250 MW units (were commissioned in the 80’s) and eight 720 to 800 MW units (commissioned in1967-1977). At the end of 1998 practically 95% of the said units had exceeded 100,000 hours of operation and 54% had exceeded 200,000 hours of operation. Due to aging of equipment, shortage of high quality fuel and low level quality of maintenance specific fuel consumption has considerably increased from 345 g/kWh in 1990 upto 369 g/kWh. The service power consumption also increased from 5.5% in 1990 to 8.8% in 1998.

The potential of Ukrainian hydropower generation is estimated close to 20 TWh electricity per year. In 1998 close to 80% of this potential was used and it is the highest results in the history of the national power industry. Major equipment of HPPs has been operated for about 40 years and need upgrading. Construction of and Tashlyk hydro power complexes delayed due to shortage of finance and negative attitude of local authorities to construction of Tashlyk complex that include HPP 3 and hydro-accumulator PP .

Ukraine now is being in transition from centralized to market economy. Number of mistakes has been made and they’re resulted in very deep economy recession that has been realizing in negative influence on national power industry. The privatization and deregulation experience in the power industry of Ukraine also rather negative then positive.

2 shortage of money resulted in absence of fresh fuel for reloading of three units with WWER-1000 reactors as at the beginning of October, 1999 3 Tashlyk water storage basin is the cooling pond for SuNPP.

UKRAINE 795 TABLE 7. ELECTRICITY PRODUCTION AND INSTALLED CAPACITY

Average Ann. Growth Rate (%) 1960 1980 1960 1970 1980 1990 1991 1992 1993 1994 1995 1996 1997 1998 to to 1980 1998 Electricity production (TWh) - Total(1) 53.9 137.6 236.0 298.5 278.7 252.5 229.9 202.9 194.0 183.0 178.0 172.8 7.7 -1.7 - Thermal 49.9 126.0 208.4 211.7 191.6 170.7 143.4 120.5 113.4 94.6 88.6 81.7 7.4 -5.1 - Hydro 4.0 11.6 13.4 10.7 11.9 8.1 11.2 12.3 10.1 8.8 10.0 15.9 6.2 1.0 - Nuclear 0.0 0.0 14.2 76.1 75.1 73.8 75.2 68.85 70.5 79.6 79.4 75.2 - 9.7 - Imports N/A N/A -17.5 -28.5 -14.8 -5.1 -1.5 -1.0 -3.0 -2.0 -0.2 -0.7 - -16.4 - Gross Domestic Consumption N/A N/A 218.5 270 263.9 247.4 228.4 201.9 191.0 181.0 177.8 172.1 - -1.3 - Distribution Losses N/A N/A 19.2 21.9 22.7 22.8 22.4 21.7 18.8 25.0 28.4 30 - 2.5 - Final Consumption N/A N/A 199.3 248.1 241.2 224.6 206.0 180.2 172.2 156.0 149.4 142.1 - -1.9 Capacity of electrical plants (GW(e)) - Total 11.7 27.9 43.9 55.6 54.4 54.4 54.3 55.2 53.9 54.0 53.9 53.8 6.8 1.1 - Thermal 9.9 25.4 37.4 37.1 35.9 35.9 36.8 37.7 35.4 35.7 36.5 36.3 6.9 -0.2 - Hydro 1.8 2.5 4.0 4.71 4.71 4.71 4.71 4.70 4.70 4.70 4.70 4.70 4.1 0.9 - Nuclear 0.0 0.0 2.44 13.8 13.8 13.8 12.8 12.8 13.8 13.6 12.7 12.8 - 9.6 (1) Electricity losses are not deducted. Source: IAEA Energy and Economic Database and Country Information.

2.4. Impact of Open Electricity Market in the Nuclear Sector

During the 1998 the State Property Fund of Ukraine was selling share of the electricity generating companies by small lots. About 11% of shares were sold at the stock exchange. Shares also were sold on competitive basis. About 35% of shares of power supplying/distributing companies were sold. However, the experience has proved that the new shareholders are too unaware of the problems faced by the power industry and are not able to initiate any positive innovations. The law prohibits privatization of NPPs. It should be noted that shares were sold at a very low price and state budget of Ukraine received only about US $90 M (to compare, in the similar situation Hungary received for the budget US $1,700 M). But the main is that new shareholders did not make investment, for the different reasons, sufficient to enhancement of situation in power industry.

A formal declaration of the power market has been even less a success. There were implanted in the market of a number of intermediary companies (paying agent) that, having nothing to do with power generation, supply and distribution, get rather high profits from power reseals. For example, in January-February 1999 the NNEGC “Energoatom” was paid 2.5% for electricity produced and intermediary companies got 14.3%. In the other words, intermediary companies get 5.2 times more “real” money per 1kWh compared to those who generate electricity.

3. NUCLEAR POWER SITUATION

3.1. Historical Development

Nuclear started its development in the early 70s with the construction of the first nuclear reactor at Chernobyl. The reactor is an RBMK reactor with a capacity of 1000 MW(e) and commenced operation in 1977. The Ukrainian nuclear energy programme was developed as part of the nuclear energy programme of the former Soviet Union in order to ensure the military defence of the country. A close co-operation was set up between research centers and relevant industries to

796 UKRAINE include all areas needed for the utilization of nuclear energy, such as geology, ore mining and processing industry, metallurgy, chemistry, etc. A significant part of the technical and scientific nuclear complex was based in the Ukraine: 15 power reactors (some of which are under construction, including 10 units of the 3rd generation), - uranium ore mining and processing enterprises, - metallic zirconium and hafnium production centers (used as construction materials in the new reactor types), and - some of the S&R and R&D institutes. The reactors have been built at 5 sites: Chernobyl, Rovno, South Ukraine, Zaporozhe and Khmeltnitski.

After the accident at the 4th reactor unit at Chernobyl, the Supreme Soviet of Ukraine adopted on 02.08.1996 a moratorium to build new nuclear power units in the Ukraine. The construction work at unit 6 at Zaporozhe was interrupted and the construction of 4 new VVER type reactors at Khmelnitski and Rovno was also halted.

In the second part of 1991 the break-down of the USSR has deeply affected the structure of the energy complex resulting in the separation of its enterprises and loss of the centralized management system. In that situation the Cabinet of Minister has made the NPP managers personally responsible for the NPP safe operation. Some changes were introduced into the management structures and the document needed for receiving by NPP the operational body status and permission for the operation. All these documents have been submitted to the Regulatory body - GOSATOMNADZOR.

In order to create the State management system, ensuring the safe operation of the nuclear energy, the Ukrainian State Committee on Nuclear Power Utilization has been established (GOSKOMATOM) by the Decree of the Cabinet of Ministers of Ukraine on 16 January 1993.

On the 6th of May 1996 a Ministry of Energy of Ukraine was established in accordance with a Decree by the President on the basis of the former Ministry of Energy and Electrification as well as on the basis of the State Committee on Nuclear Power Utilization. This new ministry includes the State department for Nuclear Power that was entrusted with the functions of the state authority responsible for nuclear power sector administration.

At present the Nuclear Energy Complex of Ukraine includes the NPPs, the uranium ore mining, processing and enrichment enterprises, the facilities for producing metallic zirconium and hafnium, the R&D Institutes, the maintenance and repair enterprises and the enterprises for NPP completion.

Nuclear Power Sector represents one of the most important component of the energy complex of Ukraine. The production of electricity by the nuclear power sector stable remains at the level of 74 TWh per year. At the same time the share of electricity generated by the thermal power plants sharply decreased. This was caused by the overall economic crisis in Ukraine, by the lack of necessary amount of national organic fuel and by the technical wearing and deterioration of the equipment installed at TPPs. Thus, the nuclear power sector became one of the most significant factor in overcoming the energy problems in Ukraine. Based on the trends above mentioned the Parliament of Ukraine adopted a Decree dated 21st of October 1993 that lifted a Moratorium on the new NPPs construction, that had come into force in 1990 as a result of consequences of the accident happened at power unit 4 of CHNPP. The above mentioned parliament’s decision has promoted the NEP development. The main provision of this programme concerns an urgent need for continuos development of the nuclear energy sector aimed at providing the national economy with the electricity totalling not less than 40% of the overall needs.

One direction in the stabilization of the nuclear energy complex situation is the creation of a national nuclear fuel cycle. NEP foresees to create by the year 2010 the nuclear fuel cycle. Pursuant to this programme the “Comprehensive programme of the nuclear fuel cycle creation” was established.

UKRAINE 797 3.2. Status and Trends in Nuclear Power

Ukraine inherited from the former USSR a developed network of NPPs (at the time of independence in 1991 there were 15 units in operation, 5 in construction, and one at Chernobyl that in 1986 had been destroyed by the severe accident). Ukraine is eighth in the world in terms of the number of operational reactors and total NPP output of electric power; seventh in terms of the total capacity of its NPPs, and twelfth or thirteenth in terms of the percentage of electric power generated at its NPPs. At present, the Ukrainian Nuclear Energy consists of the 20 nuclear reactors at 5 Nuclear Power Plants, of which 14 power units are in operation, 4 power units are under construction, and 2 are under decommissioning. The installed capacity of the operating plants is 12.818 GW(e), which is 23,8% of the total electric capacity in Ukraine. In 1998, the NPPs have produced 44% of total electric power production. The four reactors under construction have a capacity of 1 GW(e) each. The problem concerning the completion of the two power units (that is: RNPP-4 and KhNPP-2) are under consideration. Table 8 (from 2, Jul, 1999) shows the status of the nuclear power plants and Fig. 7 the increase in commissioning.

16

14

12

10

8 GW 6

4

2

0 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007

Fig.7. Commissioning of NPPs in Ukraine

At present Ukraine has operational units of three generations, built according to the designs of 60-s, 70-s and 80-s:

- 1st generation - RBMK-1000 (ChNPP 1,2); - 2nd generation - RBMK-1000 (ChNPP 3); WWER-1000 / V-302, V-338 (SUNPP 1,2); WWER- 440 / V-213 (RNPP 1,2); - 3rd generation - WWER-1000 / V-320 (ZNPP 1-6, SUNPP 3, RNPP 3, KhNPP 1).

Basic Design Characteristics item VVER-440/213 VVER-1000 reactor type Water-cooled, water- Water-cooled, water- moderated energy reactor moderated energy reactor VVER (model V213) VVER Number of loops 6 4 Thermal Capacity, MW(t) 1375 3000 Electric Capacity, MW(e) 2*220 1000 Turbine type Ê-220-44 Ê-1000-60/3000(LMZ) or

798 UKRAINE Ê-1000-60/1500(KhTzÇ) number of fuel elements in assembly 126 317 Coolant temperature at inlet, degree of 268 (514) 289 (552) Centigrade (degree of Fahrenheite) Coolant temperature at exit from reactor, 301 (574) 322 (612) degree of Centigrade (degree of Fahrenheite) Coolant flow rate through reactor, m3/h 42,000 80,000 Steam output, t/h 1469 451.8

With the commissioning of ZapNPP-6 (November, 1996), that site became the largest NPP in Europe and the third in the World. The nuclear power share in national electricity production rose from 29.2% in 1992 to 43,7% last year. It was reported that on January 6, 1996 all the nuclear units had been in operation and had supplied 50.5% of the country’s electricity.

In 1998 the reactors in operation have had an average load factor of 67.0%, that lower then in 1997 (71.3%) and NPPs have been run with following load factors: ChNPP: 54.2; SuNPP: 66.5; RovNPP: 74.4; KhmNPP: 66.0 and ZapNPP: 67.3.

The basis of the nuclear energy of Ukraine consists of the VVER - 1,000 type reactor units. The main safety criterion, on which the VVERs - 1,000 were based, was the criterion of ensuring the safety during all design base accidents, including a break in the reactor coolant system and the failure of one of the safety systems.

In order to implement the decisions of the Goskomatom's Advisory Board and taking into account unit's operational experience and the activities realized by that time, the programme on “the highest priority works for the safety upgrading of NPP with VVER - 1000 and - 440 type reactors" was developed accordingly to the special document "The safety upgrading of NPP with VVER- 1,000, 440 type reactors" approved by the Advisory Board of GOSKOMATOM on 11 January 1994 and GOSATOMNADZOR (the State Committee on Nuclear and Radiation Safety) on 12 January 1994.

The following classification has been adopted as the methodological base. This is a classification related to the level of influence of the current deviation from the scientific-technical data to the defence in depth. This methodology was developed during the safety analysis of NPPs with 440 type reactors conducted by several IAEA missions. Three categories have been defined: category I - the issues reflecting the deviation from the recognized international practice. These problems should be analyzed and discussed as a part of the activities undertaken for the solution of the most important problems. category II - the problems that are important for the safety performance. They relate to the deterioration of the defence in depth. Some specific measures should be undertaken. category III - very important problems for the safety performance. In this case the defence in depth is insufficient. Some corrective measures are needed.

The approach mentioned above permits to compile a list of high priority compensatory measures that deeply affect the safety of a probabilistic safety analysis and can be implemented in the nearest 4 years.

UKRAINE 799 TABLE 8. STATUS OF NUCLEAR POWER PLANTS

Station Type Net Operator Status Reactor Construction Criticality Grid Commercial Shutdown Capacity Supplier Date Date Date Date Date CHERNOBYL-3 LWGR 925 NNEGC Operational MNE 01-Mar-76 02-Jun-81 03-Dec-81 08-Jun-82 KHMELNITSKI-1 WWER 950 NNEGC Operational PAIPR 01-Nov-81 10-Dec-87 31-Dec-87 13-Aug-88 ROVNO-1 WWER 363 NNEGC Operational PAIPR 01-Aug-73 17-Dec-80 31-Dec-80 21-Sep-81 ROVNO-2 WWER 377 NNEGC Operational PAIPR 01-Oct-73 19-Dec-81 30-Dec-81 30-Jul-82 ROVNO-3 WWER 950 NNEGC Operational PAIPR 01-Feb-80 11-Nov-86 21-Dec-86 16-May-87 SOUTH UKRAINE-1 WWER 950 NNEGC Operational PAIPR 01-Mar-77 09-Dec-82 31-Dec-82 18-Oct-83 SOUTH UKRAINE-2 WWER 950 NNEGC Operational PAIPR 01-Oct-79 30-Dec-84 06-Jan-85 06-Apr-85 SOUTH UKRAINE-3 WWER 950 NNEGC Operational PAIPR 01-Feb-85 01-Sep-89 20-Sep-89 29-Dec-89 ZAPOROZHE-1 WWER 950 NNEGC Operational PAIPR 01-Apr-80 07-Dec-84 10-Dec-84 25-Dec-85 ZAPOROZHE-2 WWER 950 NNEGC Operational PAIPR 01-Jan-81 28-Jun-85 22-Jul-85 15-Feb-86 ZAPOROZHE-3 WWER 950 NNEGC Operational PAIPR 01-Apr-82 04-Dec-86 10-Dec-86 05-Mar-87 ZAPOROZHE-4 WWER 950 NNEGC Operational PAIPR 01-Apr-83 15-Dec-87 18-Dec-87 14-Apr-88 ZAPOROZHE-5 WWER 950 NNEGC Operational PAIPR 01-Nov-85 20-Jul-89 14-Aug-89 27-Oct-89 ZAPOROZHE-6 WWER 950 NNEGC Operational PAIPR 01-Jun-86 06-Oct-95 19-Oct-95 16-Sep-96 KHMELNITSKI-2 WWER 950 NNEGC Under Construction 01-Feb-85 KHMELNITSKI-3 WWER 950 NNEGC Under Construction 01-Mar-86 KHMELNITSKI-4 WWER 950 NNEGC Under Construction 01-Feb-87 ROVNO-4 WWER 950 NNEGC Under Construction 01-Aug-86 SOUTH UKRAINE-4 WWER 950 Min. of Power Suspended 01-Jan-87 CHERNOBYL-1 LWGR 725 NNEGC Shut Down MNE 01-Mar-70 02-Aug-77 26-Sept-77 27-May-78 30-Nov-96 CHERNOBYL-2 LWGR 925 NNEGC Shut Down MNE 01-Feb-73 17-Nov-78 21-Dec-78 28-May-79 30-Nov-91 CHERNOBYL-4 LWGR 925 NNEGC Shut Down MNE 01-Apr-79 26-Nov-83 22-Dec-83 26-Mar-84 26-Apr-86 Source: IAEA Power Reactor Information System as of 31-Dec-1999.

800 UKRAINE The directions of the work are the following:

1. The implementation of the technical and organization measures focused on the intensification of the defence in depth (capacity management, fuel cooling, radioactive materials confining - category III accordingly to the IAEA classification).

2. The implementation of technical and organization measures aimed to the prevention of the initiating events (the operational experience and feedback in the regions, the personnel training, technical support; equipment and technology systems testing and inspection, operational procedures and emergency operating instructions development, the development of the instructions on the radioactivity protection, functional test procedures).

3. The implementation of the technical and organization measures for the accident management and its consequences' mitigation and elimination (the strategy of the accident management, the personnel training, accident management instruction, emergency response facilities, accident consequence's evaluation and radiological monitoring).

4. The preparation of the materials on the design validation for taking into account the collateral effects. (The realization of the probabilistic safety analysis - PSA).

Accordingly to the results of the experts' evaluation, technical and organization measures, that deeply will affect the safety of the nuclear power plants in Ukraine are being planned It is foreseen to implement all measures in two stages. At the first stage, the following main documents should be prepared: i. on the accident's initiators; ii. on the measures for the accident consequences' mitigation (accord. to the category 3); and iii. on the measures for the emergency management (based on the existing analysis and the list of accidents).

At the second stage, other important measures will be elaborated and realized. At the same time, the obtained safety level should be evaluated using the probabilistic safety criteria.

During the special specific measure's development focused on the safety upgrading, taken into the following will be taken into account:

· new systems should meet the requirements of the current safety regulation documents (codes and standards). Taking into account the high priority of the category 3 measures, it is foreseen to use the equipment that now is being produced by the industry but does not meet all standards/codes requirements; · the project of measures should take into consideration the necessity of the time minimization for the unit's shutdown during the refurbishment; · the realization of the measures said above should not result in the multiple, repeated refurbishment of the same elements; · a comprehensive Quality Assurance programme is to be implemented.

The safety level obtained during the implementation of the programme "The Safety upgrading of NPP with VVER-1000, 440 type reactors" will be evaluated after carrying out the probabilistic safety analysis, which will permit to show the contribution of each measure into the safety upgrading. Currently Ukrainian NPPs are conducting this kind of analysis, but its performance needs considerable expenditures of money and time. Nevertheless, based on the operational experience and experts' evaluations, decisions for carrying out some refurbishing work to upgrade the safety level of the units in operation have been taken. This work must be executed in spite of the future calculations' results.

UKRAINE 801 Therefore, the modernization of WWER-1000, 440 power units will result in their safety upgrading according to the following phases:

Phase I - the measures' implementation in the nearest period of 4 years. ("The safety upgrading of NPPs with WWER- 1000, 440 type reactors".)

Phase 2- the identification of the directions for the future modernization of NPPs after the realization of PSA and activities on the safety evaluation of operational units according to the National Programme.

A very specific place in the Nuclear Power of Ukraine is occupied by the Chernobyl NPP with 2 operational RBMK type reactor. After the accident at the Unit 4 in 1986 the large complex of the long-term and prioritized measures has been elaborated and implemented. The fundamental changes (such as: the changes of the physical characteristics of the reactor core, modernization of the safety and the control of device and construction, the changes in the management systems, protection and blocking systems, strict technical regulation's requirement, additional metal monitoring and maintenance inspection have been foreseen as the first priority measures. The first priority measures which have been listed in the "Plan of the measures for the NPPs safety with RBMK type reactors" adopted and approved on June 26, 1986, were implemented at all units in 1986-1987, during the spade-work for the units start-up and the first years of their operation. Starting from 1987 the work on the safety improvement of all former Soviet Union's NPPs has been carried out according to the combined measures that were being corrected during their implementation in 1988 and in 1990. So, accordingly to the conclusion of the RBMK Chief designer:

· All the measures which have been planned for RBMK type power units after 1986 were realized. · The unit 3 safety level is not inferior to the units 1-3 of the Kursk NPP and Smolensk NPP (in Russia).

Taking into account the priority of the safety is was considered to be expedient to summarize all experience and activities including the international projects in order to make more concrete and to detail the Programme of the safety improvement of the WWER for the purposes as follows:

· to define full package of measures aimed at the safety and reliability improvement for the long- terms prospects that could be specified on the basis of the current existing level of knowledge and expertise (strategic plan); · definition of top priority measures focused on improving the safety.

The above mentioned documents have been developed by the NNEGC “Energoatom” and now they are under consideration by the nuclear regulatory body –Nuclear Regulatory Administration (NRA) of the Ukrainian Ministry for Environmental Protection.

All papers concerning long-term measures for specific NPPs and power units are specified based on these documents with setting up top priority measures.

The performed national evaluation and international projects show that the design of the WWER units in operation meet the main principles and criteria established by the national norms and standards as well as by the IAEA’s standards and guidelines. Any safety deficit was revealed requiring urgent actions.

Implementation of the long term programmes concerning modernization of the power units in operation in parallel with the improvement of the operational practice will allow to upgrade the safety and reliability (availability) of power units.

802 UKRAINE That fact confirms that running WWER power units should operate safely during the period of their designed service life (30 years), and permits to implement the tasks concerning development of measures aimed at extending the period of their service life.

When compiling the list of long-term measures we took into account all experience of our previous activities, including:

· activity and works done in Ukraine and in the Russian Federation; · international projects concerning Safety Analysis for WWER NPPs; · studies and analysis issued in the IAEA’s publications as follows: IAEA-EBP-WWER-03; IAEA-EBP-WWER-05; WWER-SC-202.

During the period from 2013 till 2020 eight VVER-1000 type units and two VVER-440 type units will be shut down. If the decision on the further nuclear power development is not be taken today, the nuclear power will finish its existence in 2020. Thus, taking into account its exceptional importance for the economical and political independence of Ukraine and the sluggishness of the important investments into the nuclear power sector, the first priority task of the Ukrainian National Economy is the decision on the development of the nuclear power industry. From many points of view such as: ecological, economical and strategically, from the view of the provision with the new fresh fuel, the final choice of the 21st century's reactor is extremely important for Ukraine.

The situation which has become usual in the Nuclear Power Sector on the one hand corresponds to the general tendencies of manufacture stagnation, and on the other has specific features. In the whole, condition of Nuclear Power Sector is possible to characterize as the following:

· Growth of a share of electricity generation by NPS in general energy structure from 26% up to 44% for the period 1990-1998 (Figure 8). · 35% reduction of general electricity production for the same period (Figure 9). · Necessity of ChNPP closing.

GWh 300000

250000

200000 Thermo Power Plants 150000 Hydro Power Plants Nuclear Power Plants 100000

50000

0 1965 1970 1975 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998

Fig. 8. The electricity production by the Power Plants of Ukraine, GWh.

The reduction of general electricity production was not connected either with the reduction of NPP installed capacity (Figure 9) or with decrease of operating reliability. Is fact, Capacity Factor (or

UKRAINE 803 Load Factor) even has grown in 1998 in comparison with 1990. Even if to take into account basic mode of NPP operations the above stated testifies to high stability of NPS.

NPPs’ stability operating is especially important, because it provides reliable power supply of base branches of a national economy in the current situation with the supply of Thermal Power Plants (TPP) with organic fuel. The sharp jump of the prices up the world level (both for delivered fuel from the nearest foreign countries, and for the fuel extracted in Ukraine) is aggravated by poor quality of black oils (high level of sulphur) and coal (high ash). Besides, the crisis in fuel supplying of TPP coincides with mass ageing of the equipment that, first of all, concerns 200 MW units. All those have caused 38% fall of electricity generation by Thermal Power Plants (Figure 8). In due to the absence of the precise concept by Thermal Power development can be expected, that the reduction of its share in Power Balance will proceed.

It is obvious, that in conditions, where input of new Hydropower capacities and real opportunities of participation of untraditional sources of energy in industrial production of the electricity with few (may be mush less) percents, the NPPs’ share in ecologically clean kinds of energy has the steady tendency to growth.

On the other hand, with increase of the NPP share in electricity production, and also due to instability of manufacture on the overwhelming majority of the enterprises there is a necessity of Nuclear Power transition to an adjustable part of the consumption diagram. It, in turn puts increased requirements to reliability and safety.

MW(e) 60 000

50 000

40 000 Thermo Power Plants

30 000 Hydro Power Plants Nuclear Power Plants

20 000

10 000

0 1965 1970 1975 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998

Fig. 9. The installed capacity of the Power Plants of Ukraine, MW.

Zaporozhye NPP

The Zaporozhye NPP now is the most powerful energy supplier in Europe, generating one-fifth of the Ukraine electricity. It makes 40 % of the electrical power produced by the Ukrainian NPPs. Zaporozhye NPP is situated in the south-eastern part of Ukraine on the bank of Kakhovka reservoir in Kamenko-Dneprovsky district, 60 km from Zaporozhye. Zaporozhye NPP is situated not far from Zaporozhye thermal power station which operates on fossil fuels (coal, gas, fuel oil). The construction of the Zaporozhye NPP was commenced in 1979. The plant's site occupies 104,7 hectars. Zaporozhye NPP consists of six units with VVER-1000 units. Each of the 6 power units consists of the WWER- 1000 reactor, Ê-1000-60/1500-2 Turbine, ÒÂÂ-1000-4 Generator. The service water supply is used with cooling pond and cooling towers. Compensation of losses within the service water system is

804 UKRAINE conducted through the discharge channel of Zaporizhzhya FPP. By the first of January 1999 Zaporozhye NPP generated 346 GWh.

South-Ukraine NPP

The South-Ukraine NPP is located in the south of Ukraine on the river Yuzhny Bug in Nikolayev region. The NPP design foresees creation of the new type of the Utility that would resolve the problems of the complex and rational use of the power, generated by the nuclear power plant, the hydroelectric power plant and also by the pumped storage power station. The construction of the South-Ukraine NPP began in 1976. At present the plant has 3 nuclear power units in operation (Electrical capacity of each unit is 1000 MW). The civil works on hydraulic complex and on Unit 4 have been frozen. Each of power units 1 and 2 consists of the WWER-1000 reactor, Ê-1000-60/1500 Turbine, ÒÂÂ-1000-4 Generator; unit 3 consists of the WWER-1000 reactor, Ê-1000-60/3000 Turbine, ÒÂÂ-1000-2 Generator. The service water supply (reverse flow) with cooling tower and cooling pond are used. Compensation of losses within the service water system is performed from Yuzhny Bug river. By the first of January 1999 South-Ukraine NPP generated 215 GWh .

Khmelnitsky NPP

The KhNPP is located in area of Khmelnitsk region, near the 's tributary. The construction of KhNPP has been started in 1981. The total design capacity of NPP is 4000 MW. Unit 1 has been put into operation in 1988. Unit 1 includes the WWER-1000 reactor, Ê-1000-60/3000 Turbine, ÒÂÂ-1000-2ÓÇ Generator. The service water supply (reverse flow) with a cooling pond are used. Compensation of losses within the service water supply system is performed from Horyn river. By the first of January 1999 Khmelnitsky NPP generated 64 GWh . As a result of the moratorium, the construction of the other power units was halted. At present in place of 4 nuclear power units stipulated by the design, there is only one power unit in operation. That creates significant difficulties in the operation of the nuclear facilities in Ukraine. After the moratorium was lifted, the work on completion of Unit 2 has been renewed again.

Rivne NPP

The Rivne NPP is located in Rivno region on the bank of the river Styr. The construction of NPPs began in 1973. In 1980 and 1981 the power units with WWER-440 type reactor (second generation's units) were put into operation. In 1986 Unit 3 built according to the unified design, has been connected to the grid. At present Rivne NPP comprises 3 nuclear power units in operation, the total electric capacity of which is 1,818 MW. Power units 1 and 2 include WWER-440 reactors, two turbines Ê-220-44, 2 generators ÒÂÂ-220-2ÀÓÇ; power unit 3 consists of WWER -1000 reactor, Ê- 1000-60/3000 turbine, ÒÂÂ-1000-2ÓÇ generator. The service water supply (reverse flow) with a cooling towers are used. Compensation of losses within the service water supply system is performed from Styr river. By the first of January 1999 Rivne NPP generated 173 GWh . The construction of the Unit 4 the estimated capacity of which will be 1000 MW is going on.

Chernobyl NPP

The Chernobyl NPP is located in Polesye region, on the bank of the river Pripyat. The construction of ChNPP began in 1970. From 1977 till 1984 four power units were put into operation. The Units 1 & 2 are the first generation's units and Unit 3 and 4 are the second generation's ones. All power units at ChNPP have only 1 heat transport circuit. Each power unit comprises the light water cooled graphite moderated reactor (Pressurized tube reactor), 8 main circulation pumps, 4 steam drums and two turbines K-500/65-300 with generator TBB-500. The turbines are installed in the turbine building which is common for all units. Each reactor is housed in a separate building.

UKRAINE 805 After the accident at Unit 4 all power units of ChNPP were shut down. The start-up of the Units 1, 2 and 3 was conducted after the development and implementation of the large complex of top- priority and long-term measures, focused on the upgrading of the safety of NPPs with RBMK type reactors. Unit 1 was shut down at 30 November 1996. At present, the work has started to prepare the nuclear fuel unloading from the reactor core. The preparatory work is going on to develop the decommissioning project. Power unit 2 of ChNPP was shut down after the fire in the turbine hall that occurred on November 11, 1991. In March 1999 the decision was taken to shut down this unit, so in the near future the preparatory works on decommissioning will be started. At present ChNPP comprises one power units in operation - #3. Power unit 3 comprises RBMK-1000 reactor, Ê-500/65- 3000 Turbine, two generator ÒÂÂ-500. The service water supply with a cooling pond are used. Compensation of losses within the service water supply system is performed from Pripyat river. By the first of January 1999 ChNPP generated 299 GWh.

In accordance with Memorandum of Understanding as of 20.12.95 between the Governments of G-7 countries, Commission of the and the dealing with the closure of ChNPP, Ukraine undertook the commitments to stop operating Unit 3 and to shut down completely the Chernobyl NPP in 2000. At that, the extensive financial assistance has to be provided in order to complete the construction and to put into operation new replacing capacities at Rivne and Khmelnitsky NPPs. The final decision concerning the future of ChNPP should be made depending on fulfilment of commitments foreseen by the above “Memorandum” that was stated officially by the Government of Ukraine in July 1998.

3.3. Current Policy Issues

In accordance with NEP the nuclear power sector faces the problems and has to implement the following tasks:

1. In the area of sector administration improvement it is required:

· to organize an efficient work of the State Department on Nuclear Power within the Ministry of Power Industry of Ukraine; · the NNEGC “Energoatom” should fully execute all its functions; · The specific Concern has to be established uniting the nuclear fuel enterprises; · to create the Association of industrial enterprises producing materials and equipment for the nuclear power sector; · to create the waste management enterprise; · creation of infrastructure for nuclear power facilities decommissioning; · creation of the scientific and technology support for the sector and Ukrainian NPPs operation; · improvement of the national system for personnel training

2. In the area of ensuring the efficient NPP operation:

· safe generation of electricity in accordance with approved plans and schedules; · implementation of the major equipment maintenance schedules; · fuel supply and performance of procedures for the spent nuclear fuel and waste management. · support and extension of centralized stocks of spare parts and units.

3. In the area of the nuclear safety improvement, modernization, upgrading and rehabilitation of power units:

· periodical safety re-assessment of each power unit; · creation of the crisis center system of Ukrainian NPPs and etc.

806 UKRAINE 4. In the area of own nuclear fuel provision to the NPPs of Ukraine:

· development of capacities and capabilities for uranium ore mining and processing; · creation of capacities for zirconium alloy and rolled metal production, spare parts , components and fuel assemblies manufacturing, and etc.;

5. In the area of the spent fuel management:

· construction of the central dry disposal facility for long term disposal or burial of the spent nuclear fuel; · development and construction of casks or containers and equipment for “dry” storage of the spent nuclear fuel on NPP sites and etc.;

6. In the area of nuclear power sector’s facilities decommissioning:

· development and implementation of procedures for ChNPP power units decommissioning; · implementation of programme for transformation of Shelter Object into the ecologically safe system; · Analysis of possibilities to extend the service life of the WWER-400, 1000 units and preparation for their decommissioning;

7. In the area of prospective civil works:

· stage (1998-2001): completion of the construction of the facilities that have a high degree of readiness (KhNPP-2, RNPP-4, Tashlykskaya HEPP), construction of additional high-voltage lines (ÏË-330 KhNPP-Khmelnitsky, ÏË-330 RNPP- -Lviv, ÏË-750 ZNPP-ÏÑ “Kakhovskaya”, ÏË-750 ChNPP-ÏÑ”Zapadnoukrainskaya”); · stage (2001-2010): completion of construction of power units that have a middle degree of readiness (preparedness (Kh-3, Kh - 4); · stage (after 2010): construction of new power units on the basis of a new reactor design to replace the power units whose service life is exhausted;

8. In the are of the international co-operation:

· acceleration of integration of Ukraine into the international co-operation; · improvement of the Ukrainian NPPs safety and joint solution of ecological problems; · acceleration of social, economic and market reforms conducted in the sector; · attraction of investments and grants; · development and continuous improvement of the nuclear fuel complex.

In accordance with a Decree of the Ukrainian Parliament this programme shall include amendments and supplements based on the current financial & economic situation in the country. Now, the “Concept of the nuclear power development in Ukraine till 2030” is being developed by the Ministry of Energy of Ukraine. The concept foresees to achieve the electricity production at the level of 100 TWh.

According to the status in 1991, the construction stage of unit 6 at Zaporozhye was 95%, of unit 2 at Khmelnitsky 85% and of unit 4 at Rovno 80%. All these Units could be put into operation in 1-2 years, however the moratorium on the construction of new NPPs in Ukraine has changed the situation. On 21 October 1993 the Supreme Soviet has cancelled the moratorium for new nuclear power plants construction. The preparation for start up has been recommenced at Zaporozhye (Unit 6); the construction work has been continued at Rovno (Unit 4) and Khmelnitsky (Unit 2) accordingly to the

UKRAINE 807 commissioning work programme. The 6th power unit of Zaporozhya NPP started its operation on the 19th of October 1995.

A specific place is taken by the Chernobyl NPP in the nuclear energy programme of Ukraine. The President of Ukraine has taken the decision to close the Chernobyl NPP at year 2000. The construction of replacing capacities and the solutions of Slavutich citizens’ social problem are evaluated by experts to amount to US $ 4.4 billions. The decommissioning of Chernobyl will result in an additional annual purchase of 4.0 mln tons of fuel for the thermal power plants. Ukraine will not be able to cover all these costs without the assistance of other countries.

As the main measures and direction of the activities on the prospective development of the electric energy, the following actions must be undertaken: i) implementation of the measures for saving energy; ii) orientation toward Ukrainian fuel (coal), the refurbishing of the fuel balance focused on increasing the share of coal in the electric power production and on decreasing the share of natural gas and crude oil; iii) taking into account the present deficiency in fossil fuel in Ukraine, the nuclear industry should be developed in the future. From 1998 till 2010, the Ukraine plans the commissioning of 2 reactors which are in an advanced stage of construction (at Khmelnitsky and Rovno) and 2 reactors which are lesser advanced in construction (at Khmelnitsky).

On 6 May, 1996 by the Decree of the President of Ukraine the Ministry of Power Industry of Ukraine was established on the basis of the Ministry of Energy and Electrification of Ukraine and the State Committee on Nuclear Power Utilization Goaskomatom). The State Department of Ukraine on Nuclear Power was established in the framework of the newly created Ministry. This State Department was authorized to carry out state control of the nuclear power industry. The National Nuclear Energy Generating Company “Energoatom” (NNEGC “Energoatom”) has been set up in accordance with the decree of the Government on 16 December, 1996 (Figure 10). This Company has been set up with the aim of national economy and population electricity supply improvement in the country, NPPs operation improvement, competition ability in market conditions and putting the existing structure of nuclear energy management in accordance to the requirements of acting legislation.

In May, 1997 NNEGC “Energoatom” joined the World Association of Nuclear Operators- Moscow Center as an associate member.

The Board President Advisor

Chief Surveillance Legal Chief Executive Audit Board Phisical Protection Accountant and Quality Support Director Director Secretary and Special Work Director Director Director

Executive Executive Executive Executive Director Director Director Director on Production on Commercial on Economics on Personnel Labor Engineering Support Aspects and Finance and Social Aspects

International Projects and Extenal Director Economics Relations Director

FIG. 10. NNEGC “Energoatom” Directorate Structure. (by state on the end of 1999)

808 UKRAINE Main company’s task is to achieve high profitability of NPP operation with increasing continuously the level of their safety. Firstly, NPP profitability is to be increased by using more efficiently their personnel through providing motivation to work more efficiently and increase the quality of work. The implementation of Quality Assurance system, safety culture, organization of the corporate activity are considered as key elements in achieving good economic results.

The Utility‘s activity is aimed at achieving the world level of its personnel skills and knowledge, creation of national basis for NPP personnel training and skill upgrading; establishment of National System on Scientific and Technical Support for nuclear power facilities based on institutes and centers of the Ukrainian Academy of Sciences and other ministries and departments, as well as development of industry on NPP equipment and spare part manufacture.

National Nuclear Energy Generating Company "Energoatom" is operating accordingly its Statute in collaboration with the national and local state management and self-management authorities. NNEGC "Energoatom" welcomes all interested enterprises and organizations to co-operation.

3.4. Organization Charts and Scheme of the Nuclear Sector Structure .

At present, the refurbishment of the nuclear energy sector is being carried out in order to: i. to provide the population and national economy with reliable electric energy supply; ii. to create the own nuclear fuel cycle and scientific-technical and engineering support of the nuclear energy; iii. to complete the market reforms in the electric energy systems of Ukraine; iv. to improve their efficiency during state property refurbishing.

Figures 11 and 12 show the structure of the nuclear sector. legislative Verkhovna Rada (Pariament) of Ukraine level commission on Nuclear Policy and Nuclear Safety

executive state run operating authorities of regulation and inspection level public authorities utilities on radiation and nuclear safety

Goskomatom of Ukraine * Ukraine ME****

Ukraine MPP** Ukraine MHP*****

Ukraine Minmashprom*** Gosatomnadzor******

NCRPP******* Goskomatom of Ukraine* - Ukrainian State Committee of Nuclear Power Utilization Ukraine MPP**- Ministry for Protection of Population against the Chernobyl NPP accident’s consequences Ukraine Minmashprom***- Ministry of Engineering, Military-Industrial Establishment and Conversion Ukraine ME**** - Ministry for Environmental Protection Ukraine MHP***** - Ministry of Health Protection Gosatomnadzor****** - Ukrainian State Committee on Nuclear and Radiation Safety NCRPP*******-National Commission on the Radiation Protection Population of Ukraine

FIG. 11. Structure of State Safety Regulation and Administration at the branch of Nuclear Power utilization, Radiation dangerously Technology and Substances (Concept of the State regulation of safety and nuclear sector administration in Ukraine, approved by Verkhovna Rada from 25 January 1994)

UKRAINE 809 4. NUCLEAR POWER INDUSTRY

4.1. Supply of NPPs.

Scientific management of NPP development "Kurchatov Institute" (Russia)

NPP design “Kievenergoproject” (general desiner for RNPP, KhNPP, ChNPP) “Kharkovenergoproject” (general desiner for ZNPP, SUNPP) Energy equipment development NIKIET, OKB “Hydropres”, NPO “ZKTI” (Russia)

Equipment production and supply “Atommash”, “Izhorsky Plant”, LMZ PEO “ Electrosila”; Podolsky machine manufacturing plant (Russia) PO “”, PO “Zaporozhtransformator” (Ukraine)

Minister

First Ministry Deputy-

Chairman State Department on

of State Department Nuclear Power on Nuclear Power

Ministry Deputy Ministry Deputy on nuclear- on radioactive fuel cycle and waste usage nuclear engineering

administration on fuel NPP cycles of reactor administration plants administration on decommission

administration on scientific and technical primary products sources administration administration on radioactive waste usage nuclear administration engineering administration on Nuclear Safety Analysis and regulations and specifications

medical administration phisical protection section

FIG. 12. Organizational Structure of State Department on Nuclear Power at the Ukraine Ministry of Power Industry (by state on the end of 1999)

4.2. Operation of NPPs

All Ukrainian NPPs are state organizations. On 17 October 1996 the National Nuclear Energy Generating Company “Energoatom” -NNEGC- was established by the Decree of the Cabinet of Ministers to create the state management system and to ensure the safe operation of the Nuclear

810 UKRAINE energy facilities. According to this Decree the rights of the Operating organizations have been channelled to NNEGC.

Analyzing the current situation in the NPP personnel training in Ukraine, we could make the following conclusions: i. the majority part of the specialists came to the plants from the educational institutes beyond the borders of Ukraine; ii. currently we face the difficulties due to some of the following reasons:

· the shortage of well trained and high qualified instructors; · the shortage of the technical support, i.e. the simulators for the personnel training; · the lack of the methodological support that is not developed enough to cover all needs and without which the complex personnel training is not possible; · the organization for the NPP managers and personnel training are beyond the Ukrainian borders; · in Ukraine there are not state organizations, office, institutes providing the NPPs facilities with the permanent methodological, scientific, information assistance in the Personnel training area.

Therefore we should develop the basic documents on the personnel training. Other documents and materials are also to be developed and we have to agree and approve them according to established procedure.

For this lack elimination and to train and support the high personnel skill’s level of the we need to create the complex system of the Personnel training for Nuclear Power and Industry of Ukraine. With this purpose two specific documents were developed: the Special Conception on the Personnel Training for the Ukrainian Nuclear Power and Industry and the State Programme on the Creation of the National Personnel training system.

4.3. Fuel Cycle, Spent Fuel and Waste Management Service Supply

The development of nuclear industry of Ukraine is going on under the programmes as follows:

· Comprehensive programme for nuclear fuel cycle establishment. · Programme concerning integration of Ukrainian zirconium production into the nuclear fuel for the WWER-1000 reactors · Programme dealing with the spent fuel management. Main tasks in the area of the Ukrainian NPPs’ spent fuel management for the period till 2010. This programme concerns establishment of on-site (near-site) storage for long-term (up to 5 years) “dry” storage of spent nuclear fuel at all NPPs site of Ukraine, moreover organization of spent nuclear fuel containers manufacture in Ukraine, establishment of central storage for long-term “dry” storage of the spent nuclear fuel. The problem of the reliable and safe radwaste storage also has to be solved. · The programme of equipment manufacture and technology mastering for the NPPs of Ukraine.

4.4. Research and Development Activities

After the USSR break down the considerable part of the scientific and technical support of the nuclear power remained in Russia. Without such basis the Ukrainian nuclear power is not able to exist and it must not. In Ukraine there is a sufficiently powerful scientific basis, but it was insufficiently specialized on the problems of the nuclear power field. NNEGC “Energoatom” supports continued relations with respective Russian counterparts , and, first of all, with organizations of the Main Designer (SDB “Gydropress” and NIKIET), VNIIAES and with Russian scientific center “Kurchatov Institute”. At the same time Ukraine is conducting activities aimed at creation of the national

UKRAINE 811 infrastructure of scientific and technology support of the NPP safe operation. In 1997 the Institute for NPPs operation support was established. Its main functions and tasks are as follows:

· collection, analysis and summarizing of NPPs operational experience, development of corrective measures; · creation and population of data bank concerning equipment’s and flow diagrams’ failures; · Assessment and re-assessment of the safety of power units in operation and under construction, participation in the preparation of safety analysis reports; · participation in the development of the modernization programmes of units in operation for the purpose to improve the efficiency and safety of their operation; · execution of functions of the nuclear power sector’s expert organization in the field of scientific and technical support of NPPs operation.

The Institute was established based on the Joint-stock basis and includes several organizations that have certain working experience in the area of nuclear power utilization. Significant assistance to the Institute development, its personnel’ professional skill upgrading as well as for strengthening of procedure and technical basis, is provided by the US national laboratories an engineering companies under the financial aids provided by the US Government.

Unfortunately, a number of scientific support’s components does not meet the current requirements. We have to create the sector scientific support covering various aspects such as : availability, diagnostics, calculation codes, water chemistry, technology for the spent fuel and radwaste management, equipment certification, decommissioning issues and etc. Now there is such an opportunity, that is creation of scientific support of nuclear power sector on the basis of the Kharkov Scientific center - “Physics & Technological Institute”.

In Ukraine we have such specific installation, as "Shelter" and the Zone and we have the problems on the NPP decommission. For this purpose it is the Shelter is to be expanded. Establishing the Programme on Nuclear Power development in Ukraine the Cabinet of Ministers proceeded from the assumption that Ukraine which is taking the path of the road of market economy creation, needs the deep social and economic reorganizations and transformations, the effectiveness of the energy policy. At the same time we should take into account the power resources balance, the competitiveness of the different energy sources , the ecological, political, social and economic consequences of the different ways of the country's power development. Today all these facts are assuming the special significance.

4.5. International Co-operation in the Field of Nuclear Power Development and Implementation

International co-operation intended for the provision of nuclear safety and safety culture improvement at the Ukrainian NPPs, development and implementation of QA programmes, development and improvement of scientific and technical support, solution of Chernobyl problems, etc. is one of the principal areas of the NNEGC «Energoatom»’s activity. The USA, the United Kingdom, France, Germany, Spain, Canada and other countries are the partners of Ukraine in the field of nuclear power. Since 1992 the European Community has been rendering technical assistance within TACIS programme to improve safety of the Ukrainian NPP’s. Representatives of French, German and Spanish companies act as consultants at ZNPP, RNPP, KhmNPP and SUNPP. Implementation of the projects under the Soviet Design Reactors International Nuclear Safety Programme is one of the major areas of co-operation with Japan, the UK, France and the USA as well as with international organizations such as IAEA, WANO, EC, etc., which provide assistance in the field of personnel training and qualification upgrading and in the field of experience exchange.

812 UKRAINE VARTA - the Intention Protocol on the co-operation with GOSKOMATOM has been signed on 15 March 1994 for a storage battery supply.

SIEMENS - an agreement on the supply of a cask for radwaste accumulation, storage and transportation has been signed on 21 April 1995.

WESTINGHOUSE ELECTRIC - co-operation in advanced technology supply and I&C systems.

EDF - the permanent group is working within the TACIS framework at Rovno NPP.

CEGELEC - the development of new modifications “Zentralog” for I&C; the preparation of the project on Zaporozhye NPP physical protection.

DUKE ENGINEERING - the contract on the construction of a dry storage cask at Zaporozhye NPP has been signed.

COGEMA - negotiations on a joint uranium ore mining.

5. REGULATORY FRAMEWORK

During the period of 1992-1995 the activities in the nuclear energy field and radiation protection have been based on the safety rules and regulations of the former Soviet Union that have been put into force by the Decree of GOSATONMNADZOR of Ukraine on 04.01.1995. The Rules and Regulations that are in force in Ukraine now don’t meet the international requirements and standards and also the social-economic relations in Ukraine. The extreme necessity to create the new legislation in Ukraine regulating the Nuclear energy utilization and radiation safety, has been appeared. At present in this area some important laws, regulations and decrees have been adopted by the Government of Ukraine. The System of the Regulatory , the Main Safety standards and the radwaste management standard; the QA standards are under development now.

5.1. Safety Authority and Licensing Process

In accordance with the Concept concerning the State nuclear safety regulatory activity and nuclear sector administration in Ukraine, approved by the Parliament on 25.01.1994, the areas of supervisions are distributed in accordance with areas of responsibilities in the field of licensing. These tasks are performed by the specific independent subdivisions and bodies:

1. Main State Inspectorate for Nuclear and Radiation Safety Supervision.

- supervision over the fulfilment of licensing requirements, provision of permits for operation of a nuclear power facility (radiation technology utilization) - supervision over the fulfilment of standards, rules and norms of the nuclear and radiation safety. - control over the efficiency of the nuclear power facility’s operational personnel training and retraining. - licensing of operational personnel that directly controls the technological process of a nuclear power facility. - use of appropriate sanctions in cases of norms, rules and licensing conditions violations. - supervision over the fulfilment of norms, standards and rules of the safe radwaste management, storage and disposal.

UKRAINE 813 2. State Sanitary Supervision of the Ministry of Health Protection of Ukraine:

- supervision over the fulfilment of conditions for getting license to use ionizing radiation sources and radio isotope devices and substances. - control over the fulfilment of radiation safety norms and sanitary-hygienic rules by the enterprises that are applying ionizing radiation sources, radio isotope devices and substances - inspection of the corporate system for accounting, storage and utilization of ionizing radiation sources, radio isotope devices and substances - monitoring over the emergency preparedness of organizations and enterprises utilizing ionizing radiation sources, radio isotope devices and substances - selective monitoring over the radioactive contamination of foodstuffs and environmental objects. - application of appropriate sanctions in case of violations of norms, standards, rules and license conditions.

3. State Ecological Inspectorate of the Ukraine Ministry for Environmental Protection:

- selective monitoring over the fulfilment of applied standards concerning radioactive substances discharges and releases outside the site limits of facilities that use radioactively hazardous technologies.

The National Commission on the Radiation Protection of Population of Ukraine provides consulting functions in the area of the situation analysis and development of recommendations related to the radiation safety of population.

All activities that are united by the common hazard factor such as the ionising radiation could be split into the 3 categories - licensing objects): category 1 - nuclear hazardous facilities and complex radiation technologies. To ensure their safety a number of organization and technical measures are to be applied and the safety analysis report should be prepared (nuclear power and research installations, all areas of nuclear fuel management, radwaste reprocessing technology and disposal, radiochemical plants and installations, production of isotopes and ionizing radiation sources and etc.) category 2 - utilization of ionizing radiation sources, radioisotope devices and substances category 3 - sites for nuclear hazardous facilities and complex radiation technologies. A number of complex and comprehensive organization and technical measures and safety analysis report as well as substantiation of the radwaste storage sites, are required to ensure their safety.

Taking into account the current state structures in Ukraine we may list the regulatory authorities that can grant the license for the above mentioned categories of the licensing objects:

- State Committee on Nuclear and Radiation safety -category 1 - Ministry of Health Protection - category 2 - Ministry of Environmental Protection - category 3.

The main principle of licensing is that the Authorities in charge of licensing of a certain kind of activities is also responsible for all types of inspections, expertise to be conducted to grant the license (including the evaluation of compliance with all rules and standards that regulate the radiation safety). Interactions of these authorities are given within the frameworks of appropriate licensing procedures.

The special permission for Nuclear facilities operation and its control are carried out according to the Decree of Cabinet of Ministers of 15.04.1991 and 13.01.1993. The Regulatory Body (at that time GOSATOMNADZOR of Ukraine) has developed the “Provisional Statement on Licensing

814 UKRAINE process”. This document is used by the persons and organization that directly operate the Nuclear facilities, the Research reactors , the Nuclear materials storage.

The license for operation is issued by the Regulatory Body based on the results of the following documents analysis:

· the Safety feasibility report of the NPP · the sanitary passport, issued by Regulatory Body · the Act of the Nuclear facility Acceptance by the special commission · the list of the violations of the safety rules and regulations in force; the compensating measures · the technological regulation on the safe Nuclear facility operation. · instruction on accident liquidation. · plan of the measures on the accident liquidation · the attestation certificates of the personnel · the QA Programme

Annually Regulatory Body gives the Temporary Permissions (TP) on NPP operation. TP are given under conditions if NPP performs all planned value of repairs and maintenance, planned measures on Safety upgrading, is performing the schedule of development on Safety Analysis Report. TP is providing the conditions on NPP operation for next year, which envisage the Safety Upgrading measures realization, Safety Analysis Report development.

5.2. Main National Laws and Regulations

From 1992 to 1994 the activities in the Nuclear power area and radiation protection were based on the laws and regulations on the Safety in the Nuclear Power field of the former Soviet Union. These laws have been implemented in Ukraine accordingly to the Decree N I issued by the Regulatory Authorities of Ukraine on 4 January 1992.

One of the most important way to ensure the safety in nuclear power utilization is the legal framework or legislation. In 50s in the former Soviet Union the nuclear legislation started its development. However, the developed laws represented mostly the corporate normative acts that did not cover in full all issues concerning rights, obligations and responsibilities of actors participating in the nuclear power utilization sector. In addition, the administration of the nuclear power utilization sector was fully under the control by the Union’s authorities. The legislation of the republic concerning the issues above mentioned has been practically absent despite the situation in Ukraine that had 5 nuclear power plants in operation and several ionizing radiation sources utilized on its territory. The Chernobyl catastrophe pushed forward the development of legislation in the area of nuclear power utilization. Therefore, after the independence of Ukraine had been proclaimed, first laws have appeared in this field, such as: “About the status and social protection of citizens that suffered from the Chernobyl catastrophe” (dated 19.12.1991) è “About the legal regime on the radioactively contaminated territory” (dated 27.02.1991).

On the 25th of January 1995 the Verkhovna Rada of Ukraine approved the Concept of the State regulation of safety and nuclear sector administration in Ukraine. That put the basis for the state control over the safe utilization of nuclear energy as well as fundamental principles of nuclear power utilization that should support the nuclear legislation. These are the following principles:

· priority of the human being protection; · prohibition to execute all types of activities in the area of nuclear power utilization without appropriate license;

UKRAINE 815 · separation of functions of the state administration and state regulation of the safe nuclear power utilization; · state supervision in the field of nuclear power utilization.

On 8 February 1995, the Verkhovna Rada adopted the law "On the Nuclear Power Utilization and the Radiation Safety". It is the basic, fundamental law of the Nuclear Legislation System. It defines the priority of the people's safety and environment, the rights and the duties of citizens in the area of the Nuclear Power utilization. This law regulates and controls the activity related to the operation of the nuclear facilities and ionizing radiation, and defines the legal basis of the international obligations of Ukraine in the Nuclear Energy field. The basic nuclear third party liability rules are set out in this basic law.

The main provisions of the law are:

· The basic principles of the Government policy in the field of the Nuclear power utilization and Radiation Safety. · The rights and the obligations in the field of the Nuclear Power utilization and Radiation Safety. · The regulation of the Nuclear power Utilization’s Safety by Government. · The legal status of the judicial and physical persons who are engaged in the work in the Nuclear Power Utilization and Radiation Safety area. · The placing and construction, commissioning and decommission of the nuclear facilities and sites reserved for the nuclear waste management. · The Specific Safety rules for the territories where there are the nuclear facilities and sites, reserved for the nuclear waste management. · Specific conditions for the safety regulation of the crafts, aircraft’s, spaceships with the nuclear installation or the ionizing radiation sources. · Nuclear Waste Management. · The transportation of the ionizing radiation sources. · Physical protection of the nuclear materials and nuclear facilities. · The Prevention of the utilization of the nuclear materials, equipment and technology with the military purposes. · The Indemnification for the nuclear damages. · The liability for the legislation violation in the Nuclear Power Utilization and Radiation Safety field. · Export/import of the nuclear installations, equipment technologies nuclear materials and ionizing radiation sources, specific non-nuclear materials and services in the Nuclear Power Utilization area. · International Co-operation of Ukraine in the field of the Nuclear Power Utilization.

Other important laws and Government's Decrees related to the utilization of nuclear power and radiation safety are:

· The Law on Civil defence.

It defines the following basic tasks of the State Authorities: the prevention of the emergency; the reduction of the, damages and losses after the accident; the early notification of the population about the emergency. This law creates the system of the analysis and control; the system of early notification and communication; the special system for the oversight, control and monitoring of the radioactive contamination. This law constantly supports their readiness, preparedness for the systems' stable functioning in cases of emergency.

816 UKRAINE · The Law on Environment Protection.

Article 54. It demands to develop and to take some measures aimed to the prevention of the accidents and liquidation of their consequences. These functions, obligations have been charged on the owner of the dangerous nuclear facility and the operating organization.

· Law on “ Protection of the atmospheric air”.

Defines the standardization as well as measures aimed at the atmospheric air protection.

· Law on “Ensuring of sanitary and epidemic welfare of population”.

Article 23. Ensuring of radiation safety. Article 30. Prevention of extremely dangerous infectious diseases, mass intoxication, and radiation damages of population.

· Law on “Ecological expertise”.

Defines the forms and procedure for conducting the ecological expertise as well as the state regulation and administration in the ecological expertise area.

· Law on “Uranium ore mining and processing”.

Regulates the peculiarities of legal relations during uranium ore mining and processing as well as during its product utilization as a raw material to get the nuclear material. This law also defines specific features of uranium facilities operation, their personnel, population and environment protection against the impact of ionizing radiation sources as well as specificity of social protection of the uranium facility personnel and population due to the ionizing radiation impact.

· Law on “Radwaste management”.

The law is aimed at ensuring the protection of people and environment against the harmful impact of the radwaste now and in the future.

· The Decree of the Cabinet of Ministers of Ukraine on the Creation of the State Committee on Nuclear Power Utilization - GOSKOMATOM, issued on January 16, 1993.

According to this Decree GOSKOMATOM is responsible for the Creation of the State System for the management and the operation of the Nuclear Power facilities in Ukraine.

· The Decree of the Cabinet of Ministers of Ukraine on the Creation of "State Emergency Response Center" on the basis of the "SPEZATOM" liquidated by the same decree (July 16, 1993).

This center should ensure the permanent preparedness for the quick and effective measures in case of the accidents at the Nuclear Power facilities, radiation accident in the industry. This Center should work accordingly to the Ukraine's international obligations that are meeting the requirements of I the International Atomic Energy Agency (IAEA) to create the National System for the liquidation of the nuclear 'dent and catastrophes' consequences.

· The Cabinet of Ministers' Decree on the Creation of the Permanent Government Commission on the Ecological Safety and Emergency issued on August 10, 1993.

This commission should quickly resolve the problems that are related to the realization of the Ukrainian citizens' rights to protect their life and their health from the consequences of the accidents, catastrophes, ecological and moral damages. This decree is focused on the co- ordination and control of all complex of works at the Government level.

UKRAINE 817 · The President's Decree on the measures for the physical protection of the nuclear materials and facilities (December 28, 1993).

The decree will permit to create the physical protection system that meets the international requirements.

· Provisional Interdepartmental rules of the acceptance of the completed NPPs power units for the operation, approved on June 22, 1994.

This document establishes the procedures of the acceptance of the completed NPPs for the operation, the acceptance of their separate units and separate buildings at the NPP territory.

· The Cabinet of Ministers' Decree on the Measures for the stabilization of the NPP Work and Operation, and for the solution of the first priority tasks in the Nuclear Power development (October 3, 1994).

The Decree defines the special tasks of the Operating organization: GOSKOMATOM and GOSATOMNADZOR in the further execution of the scientific-technical expertise and safety evaluation of the NPP units in operation or under construction.

· The President's Decree on the Creation of the Ministry of the Environment Protection and Radiation Safety of Ukraine (On the basis of the Ministry of the Environmental Protection and the Ukrainian State Committee for Nuclear and Radiation Safety, which were liquidated by the same Decree of December 15, 1994).

This Decree was aimed toward the improvement of the environmental protection and radiation safety system.

· Decree by the Cabinet of Ministers of Ukraine concerning “Establishment of the National Nuclear Energy Generating Company “Energoatom” dated October 17, 1996.

With the purpose of improving electric power supply to the national economy and population, completion of market reforms in the electric power sector and upgrading the efficiency of NPPs operation under the electricity market implementation conditions.

· Decree by the President of Ukraine concerning “the Ministry of Ukraine for Emergency situations and protection of population against the Chernobyl accident’s consequences” (On the basis of the Ministry of Ukraine for Protection of Population against the Chernobyl NPP accident’s consequences and Civil Defense Headquarters of Ukraine) dated October 28, 1996.

With the purpose to improve the administration of the civil defence in Ukraine, the protection of the population and territories against emergencies and to implement the measures on ChNPP accident’s consequences liquidation.

· Decree by the President of Ukraine concerning “Establishment of the Ministry of Power Industry of Ukraine” (On the basis of the Ministry of Energy and Electrification and the State Committee on Nuclear Power Utilization) dated May 06, 1997.

With the purpose to improve the structure of administration of the energy -industrial complex to increase its efficiency under the conditions of the national economy reforming.

· Decree by the Cabinet of Ministers of Ukraine concerning “Improvement of the systems of payments for the electric and thermal power supplied” dated May 21, 1997.

818 UKRAINE With the purpose to ensure timely payments for the electric and thermal power supplied, to stabilize the financial situation of the electric power sector, to provide the stable electric power supply to the social production and to overcome the payment crisis.

Thus, Ukraine for comparatively short period of time was able to create its own nuclear legislation that was formed as the independent sector or branch of the national legislation. The fundamental provisions of this sector were reflected in the in accordance to which the State is responsible for the liquidation of Chernobyl accident’s consequences and preservation of genetic fund of the Ukrainian people . However, the nuclear legislation has some deficiencies. Not all the public relations are covered by the normative acts. There are some problems with nuclear damage indemnity or nuclear liability.

In spite of the shortage of the financing for the creation of the legal basis of the nuclear and radiation safety, Ukraine had created the State Structure for the Management and Regulation in the area of the Nuclear Power Utilization and Radiation Safety.

5.3. International, Multilateral and Bilateral Agreements

Ukraine is the party to the International Conventions in the field of nuclear and radiation safety, multilateral and bilateral international agreements.

AGREEMENTS WITH THE IAEA

· NPT Safeguards Agreement entry into force: 22 January 1998 INFCIRC/153 (Corrected)

· Improved procedures for not requested designation of safeguards inspectors not signed · Additional Protocol

· Supplementary agreement on entry into force: 21 September 1990 provision of technical assistance by the IAEA. entry into force: 5 October 1966 · Agreement on Privileges and Immunities

OTHER RELEVANT INTERNATIONAL TREATIES

· Convention on Early Notification of a Nuclear ratified on: 26 January 1987 Accident, 1986

· Convention on Assistance in the Case of ratified on: 26 January 1987 Nuclear Accident or Radiological Emergency, 1986

· Agreement on Non-proliferation of Nuclear ratified on: 16 November 1997 Weapons

UKRAINE 819 · Agreement between Ukraine and IAEA on ratified on: 17 December 1997 Safeguards

· Conventional on Physical Protection of Nuclear accession: 6 July 1983 Material entry into force: 5 December 1994

· Vienna Convention on Civil Liability for Nuclear accession: 20 September 1996 Damage, 1963

· Convention on Nuclear Safety ratified on: 12 December 1997 entry into force: 7 July 1998

· Joint Convention on the Safety of Spent Fuel signed on: 29 September 1997 Management and on the Safety of Radioactive Waste Management

· Protocol to Amend Vienna Convention on Civil signed on: 29 September 1997 Liability for Nuclear damage

· Convention on Supplementary Compensation for signed on: 29 September 1997 Nuclear Damage

· Joint Protocol non-party

· Zangger Committee non-member

· Nuclear Export Guidelines not adopted

· Acceptance of NUSS Codes no replay

· Nuclear Suppliers Group member

BILATERAL AGREEMENTS A bilateral agreement with the US government has been concluded, providing a State Guarantee (Indemnity Statement).

820 UKRAINE REFERENCES

[1] National in 1985-1998. (In Russian) (Reference books). State Committee on Statistics, Kiev.

[2] Economic report of the President of Ukraine in the Supreme Soviet, (1994) (in Russian)

[3] The National Energy Programme of Ukraine for the period till 2010 (NEP).

[4] The comprehensive programme of the nuclear fuel cycle creation in Ukraine, GOSKOMATOM, (1995).

[5] The Wholesale Energy Market of Ukraine, Minenergo of Ukraine, (1995).

[6] Nuclear Legislation.. Collection on normative-legal acts (on 1 January 1998). Kiev, 1998 Regulations of Ukraine (Reference books).

[7] IAEA Energy and Economic Data Base (EEDB).

[8] IAEA Power Reactor Information System (PRIS).

UKRAINE 821 822