Analysis: As bidding opens to foreign firms to build new nuclear facilities in Turkey, authorities in Ankara see immediate economic advantages to turning the projects over to Chinese firms. But blatant bypassing of more experienced European firms is also
ISTANBUL - The Turkish government recently signed a $20 billion project with Russia to build nuclear power facilities in Akkuyu, Turkey. Now the Turkish government has set its sights on constructing a nuclear plant in Sinop, Turkey. The Financial Times recently reported that China is the primary contender for this contract due to its ability to secure financing without requiring guarantees from the Turkish government.
Prime Minister Recep Tayyip Erdogan visited China last week, confirming reports of the deal when Energy Minister Tanir Yildiz held talks with Chinese authorities. At these meetings, Chinese Energy authority Liu Tienan pledged full financial guarantees for the $20 billion project.
China faced competition from two other countries for this project: Japan and South Korea. Japan's TEPCO pulled out of the auction citing protests from anti-nuclear activists following the Fukushima nuclear disaster. South Korea's firms have stayed in the running, but have announced that they can only accept the contract if the Turkish government guarantees against the risks of the project.
So this all leaves China in the driver's seat. The burgeoning Asian superpower recently won a contract to build a nuclear plant in South Africa under direction of the state-supported China National Nuclear and China Guangdong Nuclear Power Corporation.
But this all begs the question as to why Turkey is only courting countries like China, Russia, South Korea, and Japan for nuclear energy services. If safety is the first concern, why has Turkey been ignoring more experienced European companies?
Turkey's bad attitude
The answer to this question has more to do with politics than economics. It seems that Turkey does not want to offer these large projects to Europe because of the deteriorating relations with the Old Continent. All this despite the fact that the most experienced nuclear energy companies are based in France and Germany.
Yet as long as these two countries continue their outspoken opposition to Turkish entry to the European Union, the chances for French or German firms to win any public bidding will remain slim. And now that French President Nicolas Sarkozy has passed a law outlawing denial of the Armenian genocide, the chances are close to nil for firms like Framatome, NPI, and Areva.
So what is the biggest risk associated with contracting China to build the next nuclear power plant?
For starters, China has yet to secure international confidence when it comes to constructing safe nuclear energy facilities. Chinese firms do not offer the same modern designs on foreign projects that they use in domestic plants because of intellectual property restrictions imposed by Western firms such as Westinghouse and Areva. This means that if China builds a plant in Turkey, it will be based on older models developed in China, not on the international state-of-the-art designs.
So Turkey should ask itself: do we really want a made-in-China nuclear power plant?
Read the original article in Turkish
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