BelPPP Arithmetic

Cheap electricity from two nuclear power plants will cost twice as much as from one.

On Monday, the government published a government decree on raising housing and utilities tariffs. At that, electricity tariffs are raised by 12% at once, while the annual inflation forecast is 5%. And it turns out that either the government does not believe in its forecasts, or electricity tariffs will grow twice as fast as all other prices. And if the government does believe its forecasts, then it has absolutely no faith in its nuclear plant.

That's because the nuclear plant's main advantage was supposed to be cheap electricity. Just recently, the Energy Ministry boasted about the success of the Belarusian nuclear power plant. According to the ministry, last year BelNPP produced 15.7 billion kilowatt-hours of electricity and it saved 2.4 billion cubic metres of gas.

However, if the plant provides the country with such colossal savings, then your tariffs should not rise in principle. And if they do, they should definitely not rise higher than the inflation rate. But the problem is that nuclear electricity, of course, is cheap, but we had to pay dearly for it.

The Belarusian nuclear power plant cost $6 billion. Of this, almost $5.5 billion is a Russian loan, which Belarus has been paying back for two years already. Although initially it was supposed that the authorities would pay for the loan with money from selling the electricity generated by the Belarusian nuclear power plant to its neighbours. But the construction of the nuclear plant spoiled relations with neighbours, and there was no one to sell electricity to.

Just the day before the decision to raise tariffs was published, Lithuania, Latvia and Estonia finally withdrew from BRELL, the unified energy system, uniting them with Belarus and Russia, and joined the energy system of the European Union. Lithuanian President Gitanas Nauseda commented: ‘Goodbye Russia. Goodbye Lenin.’

The energy collapse, which Belarusian and Russian state media were scaring about, did not happen in the Baltic countries. In fact, it could not happen. The procedure of cutting the high-voltage line had a symbolic meaning. Dismantling of the power lines started several months ago. And the Baltic countries have not been buying Belarusian and Russian electricity since 2022.

And this is certainly bad news for the prospects of Belarusian nuclear electricity. Even if the neighbours change their minds and want to buy electricity from Belarus, it will be impossible to do so. So, the only way to compensate for the costs of NPP construction is at the expense of Belarus' own consumers.

And it's good that so far Belarusians have to pay for only one NPP. Since the Belarusian authorities are planning to build a second one. And cheap electricity from two nuclear power plants will cost twice as much as from one.

Feliks Mirski, ‘Belarusians and the Market’

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