Czech Problem – European Commission Raises Objections to Nuclear Power Plant Expansion

Czech Republic’s Nuclear Ambitions Face EU Hurdles over Dukovany Expansion

The Czech Republic plans to expand the Dukovany nuclear power plant, but the €6 billion project has hit a roadblock at the European level. The European Commission has raised objections regarding the selection of South Korean company KHNP as the project’s contractor, citing suspicions that the firm may have received unlawful state aid from abroad. While the Prague government insists that the process was carried out properly, Brussels remains unconvinced, sparking a heated dispute that could impact the future of nuclear energy across Central and Eastern Europe.

Commission Scrutinizes Potential Foreign Subsidies

The European Commission’s concerns focus on possible violations of new regulations on foreign subsidies. Since mid-2023, the EU has enforced rules designed to protect its internal market from unfair competition by companies receiving foreign state support. In KHNP’s case, the suspicion centers on financial aid from the South Korean government.

Reportedly, the Commission sent a letter to the Czech Ministry of Industry and Trade requesting clarification. The matter is serious, as it involves not only compliance with EU law but also transparency in the tender process for a strategic energy project.

EDF Files Complaint – France Enters the Dispute

The Commission also received a formal complaint from French energy giant EDF, which lost the tender for the new nuclear unit. EDF is challenging the outcome, alleging a lack of transparency and insufficient scrutiny of KHNP’s financing sources. The French argue that the Korean bid was artificially low due to illegal subsidies.

This is not just a technical disagreement, but an emerging conflict of interest—Korean firms seek entry into European markets, while EU companies push back against being undercut by state-supported competitors.

Czech Authorities Defend KHNP Selection

Czech officials stand by their decision to award the contract to KHNP, asserting it followed legal procedures and that the South Korean firm submitted the most advantageous bid. Prime Minister Petr Fiala emphasized that the choice was based on clear criteria—price, technology, timeline, and safety—not political considerations.

The operator of the Dukovany plant, energy company CEZ, maintains that KHNP offered the best conditions. The project involves delivering a 1,200 MW nuclear reactor by 2036—an essential component of the Czech Republic’s energy transition and drive for independence from fossil fuels. If the European Commission determines KHNP received prohibited aid, it could block the project or require repayment of any unlawful subsidies.

Legal and Political Consequences

Further complicating matters, the Czech Administrative Court has suspended the signing of the contract with KHNP until EDF’s appeal is resolved. The future of the Czech nuclear program now hangs in the balance. Should the Commission block the deal, it could strain relations with non-EU partners—but also signal that the EU is serious about upholding fair competition rules.

Source: businessinsider.com.pl

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