This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 03 MADRID 004241 
 
SIPDIS 
 
SENSITIVE 
 
DEPARTMENT FOR EB/ESC/IEC AND EUR/WE; NRC FOR INTERNATIONAL 
PROGRAMS: ROSALES-BUSH; DOE FOR INTERNATIONAL PROGRAMS 
 
E.O. 12958: N/A 
TAGS: ENRG TRGY SP
SUBJECT: FUTURE OF NUCLEAR ENERGY IN SPAIN 
 
REF: A. MADRID 3817 
     ¶B. PARIS 7832 
 
¶1.  (SBU)  SUMMARY:  High oil prices and the ever more 
apparent economic costs of compliance with the Kyoto Protocol 
should guarantee that the possibility of constructing new 
nuclear power plants in Spain remains the subject of public 
debate.  However, given that the Zapatero Government will 
not/not have to take any significant license-related decision 
with respect to Spain's nine operating nuclear reactors until 
2008, we believe that Zapatero will avoid confronting this 
sensitive issue during the 2004-8 term of the current 
Congress.  END SUMMARY. 
 
¶2.  (U)  Spanish business headlines, like those in many other 
EU economies, have trumpeted the return of the nuclear energy 
option.  Pointing to oil at over USD 50 a barrel, and the 
growing realization that compliance with the Kyoto Protocol's 
restrictions on greenhouse gas emissions will likely increase 
energy costs, the Spanish business press has called for the 
government to reconsider its 1983 moratorium on the 
construction of new nuclear reactors.  (NOTE:  Spain's 
alleged nuclear power plant construction moratorium is 
actually a myth.  The Socialist Government of Felipe Gonzalez 
did indeed impose such a moratorium in 1983, halting 
construction of five nuclear power plants.  This moratorium 
was finalized in the 1994 decision (also by Gonzalez) to 
formally abandon the construction of these five facilities. 
However, in 1997, the then newly elected Popular Party (PP) 
Government removed the construction ban in the context of a 
broader effort to liberalize the Spanish electricity market. 
Since 1997, the moratorium has been, more than anything, 
self-imposed (i.e., industry preferring to avoid forcing the 
government's hand on the question, knowing that construction 
of additional nuclear power plants would prove too 
controversial and thus might not make business sense).  END 
NOTE). 
 
¶3.  (SBU)  To get a handle on whether Spain could actually 
resume constructing nuclear power reactors, ESTHOFF conducted 
a round of late October meetings with key players in the 
Spanish nuclear equation including:  (1) Juan Antonio Rubio, 
Director General of the Center for Energy, Environment, and 
Technology Investigation (CIEMAT); (2) Francisco Javier Arana 
Landa, Deputy Director General for Nuclear Energy, Ministry 
of Industry, Tourism, and Commerce; (3) Julio Barcelo, 
Commissioner, Nuclear Security Council (NSC - Nuclear 
Regulatory Commission equivalent); and, (4) Joan Esteve, Head 
of Plans and Studies of the Catalan Energy Institute 
(Catalonia's energy ministry).  All four agreed that the 
current Zapatero Government (2004-8) will not/not take any 
significant decision regarding the future direction of 
nuclear power in Spain, preferring to leave that 
controversial decision to the next government.  All four 
bolstered their views with the same arguments. 
 
¶4.  (U)  Spain currently has nine reactors operating in seven 
locations providing about 24 percent of the country's 
electricity.  One of the nine, Zorita (near Guadalajara) will 
be closed in April 2006 after 38 years of operation.  The 
decision to close Zorita was taken by the previous Popular 
Party Government and was not controversial, as Zorita was a 
test reactor and had already enjoyed one operating license 
extension (2001-6).  Given its small size, Zorita's closure 
will only reduce the nuclear share Spain's electricity 
generation to about 23.5 percent (from 24 percent). 
 
¶5.  (SBU)  The next reactor license set to expire is that of 
Garona (near Burgos), which must shut in 2009 unless its 
operating license is extended.  Barcelo said Garona's owner 
must file a permit extension request by 2006 (to avoid 
mandatory shut down in 2009) and that the NSC was required to 
prepare a recommendation regarding the expected request that 
same year.  He presumes the NSC will recommend extending the 
license of this facility, which opened in 1971.  However, he 
stressed that since Garona's license only expires in 2009, 
the GOS (i.e., Arana's office inside the Industry Ministry) 
is not likely to adjudicate the NSC recommendation until 2008 
(after the next general elections).  Barcelo and the others 
said the Garona decision would be the long awaited indicator 
of GOS views vis-a-vis the future of nuclear energy in Spain. 
 An extension would revive the hopes of those who support new 
nuclear power plant construction.  An extension denial would 
seal the fate of Spain's nuclear future, at least for the 
short-term.  The other three interlocutors fully agreed with 
Barcelo. 
 
¶6.  (SBU)  After Garona, the Government will have a respite 
from further tough nuclear power plant decisions, as Spain's 
other seven reactors (not including Zorita and Garona) date 
from the 1980s and hold 40 year operating permits.  This 
means that any license extension requests for these seven 
facilities would not be adjudicated until the 2020s. 
However, Spain is required by domestic law/regulation to 
establish by 2010 a centralized nuclear waste storage 
facility.  NRC Commissioner Barcelo said the debate over the 
site (and the NIMBY sentiments it will undoubtedly stir up), 
would form the back drop against which the Garona decision is 
taken.  He believed this debate would help the foes of 
nuclear energy.  But on the other hand, he added, electricity 
costs were expected to rise over the next five years.  This, 
he believed, would increase pressure to reconsider the 
nuclear option. 
 
¶7.  (SBU)  Of the four contacts, Industry Ministry Deputy 
Director General for Nuclear Energy Francisco Javier Arana 
Landa was clearly the most pessimistic about the short-term 
prospects for further nuclear reactor construction in Spain. 
During his meeting with ESTHOFF, Arana took a phone call 
informing him that a group of anti-nuclear protesters were 
trying to penetrate Garona's security.  Arana attributed the 
protest to the fact that the anti-nuclear lobby was also very 
much aware of the importance of the Garona license decision 
and wanted to lay down an early marker that they would not 
countenance any GOS attempt to back away from its current 
anti-nuclear stance.  Arana said "the Spanish are more German 
than French" (referring to the famed stereotype of the 
anti-nuke German and the relative lack of controversy over 
nuclear energy in France) and that it would "not be 
realistic" to bet that Spain will resume building nuclear 
power reactors any time soon.  Referring to the fact that 
Zapatero, during his inauguration speech last spring, 
reiterated his party's commitment to a gradual elimination of 
nuclear power, Arana pronounced the issue of further reactor 
construction "dead for now."  Barcelo summed up the debate as 
"not dead anymore, but not yet ripe for change." 
 
¶8.  (SBU)  Arana, Barcelo and Rubio stressed the continued 
influence of U.S. nuclear developments on the sector's future 
in Spain.  All suggested that if the U.S. decided to resume 
nuclear reactor construction, Spain would be far more likely 
to follow suit.  CIEMAT Director General Rubio, the grand old 
man of Spain's nuclear energy priesthood, went even further, 
stating that the U.S. would ultimately decide whether nuclear 
fission reactors would have a long-term place in the future 
world energy mix.  He categorically asserted that if the U.S. 
resumes reactor construction, Spain would follow.  Agreeing 
that the debate was dead through 2008, Rubio said his mission 
was to keep the nuclear flame alive in Spain so that there 
would be a technological base to support a future decision to 
resume advanced reactor construction.  For this reason, Spain 
would like to participate in France's recently announced 
plans to construct a third-generation plus European Pressure 
Reactor (EPR) in Flamanville (Ref B). 
 
¶9.  (SBU)  COMMENT:  Rubio, Barcelo and Arana are among the 
leading authorities in Spain on this subject.  They were 
singing off the same sheet of music (i.e., the nuclear energy 
debate is dead through at least 2008) and we believe them. 
We do not believe, however, that this issue will stay buried. 
 Kyoto and the mandatory search for a nuclear waste site (not 
to mention possible continued high oil prices) should keep 
the issue in the limelight.  But we agree with Arana that the 
Spanish are more German than French on the subject of nuclear 
energy and we doubt public opinion would sustain, at least in 
the mid-term, any dramatic reversal of Spain's decision to 
phase out nuclear power generation.  The potential negatives 
would far outweigh the positives, and it would simply defy 
logic for Zapatero to try to reverse his party's opposition 
to nuclear energy during his first term in office (in 
particular because his minority government requires the 
support of several smaller parties, many of them quite 
anti-nuclear, to get its agenda through Congress). 
 
ARGYROS