polish npp project and eia requirements · 3 eia requirements in poland (npp project) the proposed...

Polish NPP project and EIA requirements

IAEA, Vienna, 18.05.2016

Krzysztof Wojciech FORNALSKI

PGE EJ 1 Sp. z o.o.

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This Presentation has been prepared by PGE S.A. (“ PGE”) and PGE EJ 1 Sp. z o.o. (“ PGE EJ 1”) (the “Company”) on the basis of information received from different sources, including not independently audited and publicly available information. The Company is not responsible for the accuracy, reliability and consistency of information contained in this Presentation (“ Presentation”).

This Presentation includes results of preliminary analyses considered by PGE and PGE EJ 1. PGE and PGE EJ 1 reserve the right to introduce changes and modifications as well as to complement this information at any given stage and are not under obligation to explain reasons for these changes, modifications and complementation.

The information included in this Presentation cannot form the basis for any claims or civil law suits against PGE, PGE EJ 1 or any other entity from within PGE Capital Group, in particular with regards to damages or indemnities to be paid in case of negligence in contracting.

PGE and PGE EJ 1 wish to inform that all responsibilities and risks pertaining to and resulting from any decisions taken on the basis of or in relation to the information provided in the Presentation shall be borne by makers of these decisions. As a result, PGE and PGE EJ 1 on their own behalf and on behalf of all their directors, partners, employees and agents, declare that none of the entities l isted herein will incur any liability towards any person in connection with any consequences of the decisions and/or actions taken in reliance on this Presentation and information provided.

This Presentation reflects prevailing conditions, and PGE and PGE EJ 1’s understanding of the current situation, all of which are accordingly subject to change after this date upon obtaining new information or occurrence of new events.

For internal distribution only.

Disclaimer

Polish NPP project and EIA regulations

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EIA requirements in Poland (NPP project)

The proposed scope of the EIA report for Polish NPP

Agenda

Site selection process for the first Polish NPP

Polish Nuclear Power Plant (NPP) new build project overview


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Agenda




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Unchanged country imperatives driving nuclear power introduction to Poland – security of supply (aging generation fleet, EU climate change policies)

– Electricity supply shortage (near blackout) in August 2015, State Grid Operator forced strong electricity supply reductions on large and industrial customers for the first time since 1989

Continued Polish government commitment to the implementation of the Polish Nuclear Power Programme

Nuclear power in future fuel mix according to the Polish Energy Policy until 2050 (each of three reference scenarios defined includes nuclear in the national energy fuel mix)

Increase of Poland’s industrial capabilities with a number of Polish companies having potential to join the nuclear supply chain

Diversification of Poland’s generation portfolio in order to lower CO2

emission (currently approx. 90% based on coal and lignite)

PGE as the leader continues NPP build project development activities with important milestones achieved

Business purpose of NPP new build project NPP Project


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Mining

Power

generation

Transmission

Distribution

Wholesale &

Supply

• 2 open pit lignite mines (Bełchatów and

Turów)

• Lignite output 50 million tons p.a.

• Production net ca. 55 TWh

• Installed capacity ca. 12.6 GW

• Sales of heat ca. 18 million GJ

• 2 Lignite-fired power plants (Bełchatów and Turów)

• 2 Hard coal-fired power plants (Opole and Dolna Odra)

• Combined heat and power plants – 8 sites (Szczecin, Pomorzany, Gorzów, Bydgoszcz, Zgierz, Kielce, Rzeszów and Lublin-Wrotków)

• Hydroelectric power plants (Hydro ca. 97 MW, Pumped-storage ca. 1.5 GW), Wind farms 311 MW

• Activity of PSE S.A.

PGE Polish Energy Group – Main Investor

• Distribution of energy 32.54 TWh

• Distribution grid: 281,290 km

• Number of substations: 91,374

• Final consumers 39.60 TWh

• Wholesale market 62.44 TWh

• Balancing market 1.10 TWh

Nuclear potential locations


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Stage II Stage III Stage IV Stage I

Pre-development Development Construction Start-up

and commissioning

Site selection – site investigation and environmental surveys – obtaining

the decision on environmental conditions and site permit

Development and execution of

Integrated Proceedings (amongst others selection of technology)

Business and financing model

development (incl. support mechanisms)

National and site infrastructure

planning (incl. transmission system)

Communication and Education (public support)

Preparation and implementation of

Integrated Management Systems

Building nuclear and other specific competences (Capacity Building)

Obtaining the Decision in Principle

Preparation of a detailed technical plan of a nuclear power plant (FEED)

Prep. of a preliminary safety report

Obtaining key decisions, permits and

licences:

– Licence issued by the PAA (Polish National Atomic Energy Agency)

– Construction permit for NPP and

environmental permit

Signing a contract regarding the connection to the transmission grid

Development of associated

infrastructure for the NPP construction

Communication (public support)

Building of key competences and

human resources development

Financial close and Final Investment Decision

Site preparation and initiation of the final stage of the process

First concrete

NPP construction process

Delivery of long lead equipment

System tests

Development of national and site

infrastructure for the NPP operations

Connection to the transmission grid

Simulator installation

Further expertise development and building site operator structure

Fuel Loading Permit

Power tests

Start-up Licence

Integration of the NPP with the National Grid

Operating licence

Concession for power production

Commercial operation (COD)

Daily operations of the NPP

Maintenance of the NPP

Fuel management

Waste management

Decision in Principle

Final Investment Decision Fuel Loading

IAEA (Phase 2) IAEA (Phase 3)

Source: own materials

Preparation of the investment process and construction of Poland’s first nuclear power plant is divided into four key stages (in line with IAEA recommended approach)

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Source: own materials

National and site

infrastructure planning and preparation

Feasibility Study

Site selection (EIA, Site Permit)

based on site characterization

Stakeholder Management and Communication

(local communities

focus)

Integrated Proceedings

Implementation of Integrated Management

System

Capacity Building

Support mechanisms and business

model

Legislation and relations with

European Commission


Organization of Polish Nuclear

Program – 10 main projects


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Agenda




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Site selection

Full environmental studies and site characterization works to be started in 2016 (seismic already ongoing, meteo equipment under installation)

Preliminary national and site infrastructure plan developed in cooperation with local communities and Pomerania voivodeship

First stage of transmission grid and transmission infrastructure analyses completed for candidate sites in cooperation with PSE – Polish National Grid

So far studies and analyses were conducted in three considered sites of a nuclear power plant: "Choczewo ", "Lubiatowo-Kopalino" (Choczewo) and "Żarnowiec" (Gniewino and Krokowa). Based on their results, in January

2016, two sites were selected for the full program of site characterization and the environmental impact assessment - "Lubiatowo-Kopalino" and

"Żarnowiec".


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Environmental assessment

The purpose of environmental assessment is to provide data necessary for a decision whether a given site is suitable for the

construction of a nuclear power plant in terms of environmental protection.

Start – 2016 Duration – 12 months

Site investigation

The objective of site investigation is to confirm that a given site is suitable for a nuclear power plant in terms of nuclear safety.

Start –2016 Duration – 24 months

Site characterization and environmental assessment

Preparations are underway to launch full environmental assessment and

site investigation by PGE EJ 1

The Environmental Scoping Report (ESR) has been prepared and, on the 5th of August 2015, the first stage of the environmental impact assessment (EIA) procedure

was launched.


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Agenda




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EIA Requirements EIA requirements in Poland – Nuclear Power Plant context


THE E.I.A. ACT

The Act of 3 October 2008 on the Provision of Information on the Environment and its Protection, Public Participation in Environmental Protection and Environmental Impact Assessments

Polish: Ustawa z dnia 3 października 2008 r. o udostępnianiu informacji o środowisku i jego ochronie, udziale społeczeństwa w ochronie środowiska oraz o ocenach oddziaływania na środowisko

Other acts of the Parliament:

The Environmental Protection Act

Polish: Ustawa Prawo ochrony środowiska

The Atomic Law Act

Polish: Ustawa Prawo atomowe

Secondary legislation to Atomic Law: Regulation of the Council of Ministers of 10 August 2012 on detailed scope of assessment with regard to land intended for the location of a nuclear facility, cases excluding land to be considered eligible for the location of a nuclear facility and on requirements concerning the location report for a nuclear facility (Journal of Laws of 10 August 2012, item 1025)

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This Act shall implement within the scope of its regulation the following Directives of the European Communities:

Council Directive 85/337/EEC of 27 June 1985 on the assessment of the effects of certain public and private projects on the environment (OJ L 175 of 05.07.1985, p. 40, as amended; OJ, Polish special edition, Chapter 15, Vol. 1, p. 248);

Council Directive 92/43/EEC of 21 May 1992 on the conservation of natural habitats and of wild fauna and flora (OJ L 206 of 22.07.1992, p. 7, as amended; OJ, Polish special edition, Chapter 15, Vol. 2, p. 102);

Directive 2001/42/EC of the European Parliament and of the Council of 27 June 2001 on the assessment of the effects of certain plans and programmes on the environment (OJ L 197 of 21.07.2001, p. 30; OJ, Polish special edition, Chapter 15, Vol. 6, p. 157);

Directive 2003/4/EC of the European Parliament and of the Council of 28 January 2003 on public access to environmental information and repealing Council Directive 90/313/EEC (OJ L 41 of 14.02.2003, p. 26; OJ, Polish special edition, Chapter 15, Vol. 7, p. 375);

Directive 2003/35/EC of the European Parliament and of the Council of 26 May 2003 providing for public participation in respect of the drawing up of certain plans and programmes relating to the environment and amending with regard to public participation and access to justice Council Directives 85/337/EEC and 96/61/EC (OJ L 156 of 25.06.2003, p. 17; OJ, Polish special edition, Chapter 15, Vol. 7, p. 466);

Directive 2008/1/EC of the European Parliament and of the Council of 15 January 2008 concerning integrated pollution prevention and control (OJ L 24 of 29.01.2008, p. 8).

THE E.I.A. ACT EIA Act


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The selection of the proper site for NPP construction is a complicated multi-step process. The EIA items are represented in, inter alia:

• site investigations lasting up to 24 months consisting of meteorological, archeological, (hydro) geological as well as natural environment studies

• envelope boundary conditions for the nuclear technology (Gen III reactors)

• analysis and modelling of environment impacting factors, e.g. air pollutants dispersion calculations from conventional (combustion) and unconventional (radionuclides) sources, noise mapping, landscape and natural environment impact, water quality and cooling water plume, wastes management

• application for the environmental permit including the EIA report (first stage, conceptual design) preparation and submission to the relevant authority (General Directorate of Environmental Protection [GDOŚ])

EIA and the site selection process for NPP – #1 EIA Requirements


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Continued…

• the EIA report review as a part of administrative procedure, including: opinions of Director of Maritime Office, Ministry of the

Environment, State Sanitary Inspector and State EIA Commission transboundary procedure coordinated by the General Directorate

of Environmental Protection (GDOŚ) (+ Espoo Convention) necessary for the environmental decision of investment can be repeated (if necessary)

• environmental decision by GDOŚ after EIA (but before the site and construction/building permissions)

• national and local EIA commissions (which advise GDOŚ)

• the EIA report (second stage at the construction permit issuance) preparation and submission to the relevant authority (GDOŚ)

• EIA report review as a part of administrative procedure, following the same steps as at the first stage

• opinion of the President of National Atomic Energy Agency (PAA) – the Polish nuclear regulatory body

EIA and the site selection process for NPP – #2 EIA Requirements


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Agenda




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General description of the project and general plan of the site

Schedule for construction and exploitation phases including start-ups

Description of the construction phase and impact zones with materials and utilities requirements - balance sheet

Description of the natural environment

Geological, hydrological and geotechnical site relevant conditions

Surface and underground water conditions (quality, levels, flow velocity and direction etc.)

Population distribution and living conditions including archeology

NPP safety and emergency plans and procedures

Climate change (and associations) and adaptation measures

Technological aspects of NPP exploitation and impacts analysis including technological and location variants – impact assessment and minimization measures implementation (if exceedances reached)

The proposed scope of the EIA Report for the first Polish NPP EIA Report


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Description of different options expected by the Investor

Accident scenarios

Nuclear and non-nuclear impacts

Dispersion of radioisotopes in air, water and ground

Description of assessment methods

Description of all other activities

Restricted use area around NPP

Social aspects and local community support

Plans for future monitoring of the environment

Attachments

Maps and figures

Abstract

References

The proposed scope of the EIA Report – continued #2 EIA Report


Thank you

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BACK-UP SLIDES


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Plant Vendor EPC Contractor

Fuel supplier O&M support provider

Equity investor / Strategic Partner

Integrated Proceedings

Export Credit Agencies Commercial financing

Under the Integrated Proceedings, potential bidders will be requested to include in their offers all of the following elements:

Provision of technologies for the NPP as well as

the general implementation of the investment (EPC)

Nuclear fuel supply and related services

Provision of O&M support services for the NPP together with capacity building program for PGE EJ1

Proposed rules and conditions for the capital engagement by strategic investor/business partner

Concept of how to finance the Investment, together with written confirmation of interest in supporting the project from relevant ECAs, financing institutions or commercial banks (at best offer(s) selection stage; these are construed as Letters of Intent and potentially also the preliminary proposed financing conditions)

All elements of the IP scope are obtained in one procedure

The financing closure takes place after the above mentioned

elements are obtained, but its initial terms and conditions are the subject of the IP scope

Integrated Proceedings are to be conducted as a competitive procedure based on the Contracting Authority’s Regulations, outside of the regime of the PPL

Integrated Proceedings (IP) framework

IP Participants Companies which have submitted declarations of

participation and took part in preliminary dialogue between 2012 - 2015


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Reactor Technology

EPR AREVA NP

PWR 1650 MWe

AP1000 Westinghouse /

Toshiba PWR

1100 MWe

ESBWR GE-Hitachi

BWR 1535 MWe

ABWR GE-Hitachi

BWR 1350 MWe

APR1400 KEPCO PWR

1400 MWe

EC6 Candu Energy

PHWR 700 MWe

Received declarations determine the potential reactor technologies for the first Polish NPP


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Planning and development of site infrastructure

Define the scope of investments and the preliminary schedule for their preparation and implementation

Consultation and agreement with the

municipalities and the Marshal Office of the

Pomeranian Voivodeship

Finalization of the first stage of network

analyses for specific sites and considered

NPP reactor technologies in

cooperation with PSE SA (Polish National Grid)

Development of the site development study, transport

study, and permit plan


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Business and Financing model development (incl. support mechanisms)

In April 2015, PGE and National Business Partners (KGHM Polska Miedź SA, Tauron Polska Energia SA and Enea SA ) signed a shareholding agreement giving each of the partners 10% share in PGE EJ 1

Business model, investment, support mechanisms, electricity market

PGE EJ 1 shareholding structure (since April 2015)

Ongoing work on financing model for the investment. Involvement of Export Credit Agency considered. Need of support scheme to be established

Necessary support system for the Project including Contract for Difference (CfD) and National Treasury guarantees


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STAKEHOLDER MANAGEMENT AND COMMUNICATION

Activities on national level

Activities on local level Development of long-term cooperation program with the local communities

3 Local Information Centers – 1 in each of the 3 adjacent communities hosting 3 candidate sites

Dedicated communication regarding site characterization activities – workshops, printed publications, public exhibitions

Ongoing education for local schools – dedicated classes, trips to science centers

Seasonal educational events on nuclear power during major local events

Focused projects – study tours to European NPPs, conferences, seminars

Świadomieoatomie.pl – website presenting various information on nuclear power as well as news on the NPP project in Poland

Atom dla Nauki (Atom for Science) – promoting nuclear-related knowledge among students and cooperation with universities (3rd edition)

Pandora’s Promise – organization of the official premiere and several special screenings of the documentary by Robert Stone

Polish NPP new build project


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HIGH LOCAL SUPPORT FOR NPP CONSTRUCTION IN THE NEIGHBORHOOD Polish NPP new build project

Regular public opinion polls (every 6 months since 2011) to monitor local and national levels of support for the NPP.

Recent opinion polls (Autumn 2015) show strong support for the NPP in all three communities, with support levels ranging from

66% (Krokowa) up to 71-72% (Gniewino and Choczewo)

% of supporters

CHOCZEWO GNIEWINO KROKOWA


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