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FM AMEMBASSY BRUSSELS
TO RUEHC/SECSTATE WASHDC IMMEDIATE 3576
INFO RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY
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RUEATRS/DEPT OF TREASURY WASHDC PRIORITY

UNCLAS E F T O SECTION 01 OF 03 BRUSSELS 003799 
 
SIPDIS 
 
NOFORN 
SIPDIS 
 
DOE FOR NNSA - DESMOND AND AOKI 
TREASURY FOR OASIA - ATUKORALA 
STATE FOR ISN/NESS, EB/OGE AND EUR/UBI 
 
E.O. 12958: N/A 
TAGS: ENRG EINV EFIN SENV BE
SUBJECT: BELGIAN NUCLEAR ENERGY REASSESSED 
 
REF: A. BRUSSELS 2249 
     ¶B. BRUSSELS 2945 
 
¶1. (SBU) SUMMARY. Pressed by global energy concerns and 
climate change targets, Belgium is reassessing the country,s 
use of nuclear energy and its future energy policy options. 
Although current law commits Belgium to decommissioning its 
nuclear-powered generating installations from 2015-2025, 
media, business and political circles are focusing attention 
on the costs and alternatives, and several studies point 
toward rethinking the decommissioning policy. 
 
¶2. (SBU) Comment: Belgium,s challenge is to align political 
will with environmental, economic and financial realities. 
While Federal elections in May 2007 will impede reaching a 
definitive decision, the timeframe for considering 
alternatives before action must be taken to implement current 
law is fast shortening.  The weakened economic liberal 
parties may not be up to the task of forging a consensus on 
electric power for the next 30 years.  End Summary. 
 
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Revisiting Reality 
------------------ 
 
¶3. (SBU) Belgium is second only to France among EU countries 
in terms of its dependence on nuclear-sourced electric power. 
 55 percent of Electrabel,s capacity comes from the seven 
nuclear generating plants in Belgium, and Electrabel supplies 
over 90 percent of the country,s electricity.  While nuclear 
power stations are less than 40 percent of installed 
generating capacity, their reliability and cost advantages 
permit them to cover over half the country,s electricity 
demand.  When Green parties were part of the governing 
coalition back in January 2003, the Federal Parliament passed 
legislation committing Belgium to backing out of nuclear 
power starting in 2015.  Following the Federal election in 
the May 2003, the Greens were ousted from the coalition. 
However, the ruling liberal-socialist government has not 
pressed openly for reversing the policy, both because it is 
enshrined in a Royal Decree and to avoid losing support from 
the socialist parties in the coalition who have not favored 
nuclear energy. 
 
¶4. (U) Over the past year the future of nuclear power in 
Belgium has been the focus of numerous media articles, a 
Ministry of Economy study (not yet publicly released), and an 
independent public policy research study by the Jean Gol 
Center (which has ties to the liberal party).  Intimations by 
federal and regional ministers of finance, economy and energy 
about the value that nuclear power offers Belgium have tested 
the waters of public opinion, but the federal government 
itself has studiously avoided tackling the issue head-on. 
Recent publicity about climate change and the costs Belgium 
faces in trying to meet its Kyoto Protocol targets have 
pushed nuclear energy to the front pages.  The widespread 
electricity blackout in Germany, France, and Belgium on 
November 4 further also prodded Belgians to reconsider the 
reliance on foreign suppliers for the Belgian grid that would 
only increase if the nuclear power option was foreclosed. 
 
------------------------ 
Security and Instability 
------------------------ 
¶5. (U) Overall, the new studies of Belgium,s energy sector 
indicate that, in terms of energy security, Belgium would be 
worse off by withdrawing from nuclear power.  Belgium is 
already dependent on imports for 76 percent of its energy 
needs, more than France (50 percent) or Germany (62 percent). 
 Moving from nuclear to fossil fuel for generating 
electricity would increase dependency on imports.  Importing 
gas from Norway and the UK for electricity generation would 
leave Belgium vulnerable to the coming drop in North Sea 
production; starting imports from Russia would add new 
vulnerability and put Belgium in competition with Germany and 
other users farther up the pipeline.  Importing gas from 
Algeria and Libya (already marginal suppliers) would increase 
trade and political dependence on those countries.  Domestic 
coal, a low-grade sulfurous product, is an available and 
secure energy source, but its practical use awaits real 
progress on clean coal technologies.   While EU and US 
research to develop new clean energy technologies is 
progressing, whether such technology will be economically 
feasible by 2015 is uncertain. 
 
¶6. (U) Environmentally, Belgium has little hope of meeting 
 
BRUSSELS 00003799  002 OF 003 
 
 
its Kyoto CO2 gas emissions targets if it switches from 
nuclear to fossil fuel generating plants.  At present, 
Belgium is straining to reduce its CO2 emissions to 7.0 
percent below its 1990 level.  Gas-fueled alternatives might 
produce two to three times more emissions than those 
currently produced from electricity generation.  Coal 
generation with current technology would be worse.  Renewable 
technologies exist, but not cheap or plentiful enough to meet 
demand.  Belgium,s few hydroelectric options are already 
fully exploited, and account for only 5 percent of 
electricity needs.  Investments in wind power along the 
Belgian coast are underway, but are capital intensive, 
unpopular with local residents, and require fossil fuel 
back-up facilities.  Bioethanol fuel can be created, although 
one energy expert confided to Econoff that this process 
actually consumed more energy to produce than it replaced in 
imported gasoline.  Total renewable and alternative energy 
generation is projected to provide only 8 percent of total 
electric energy consumption by 2010 ) nothing that will 
compensate for losing over half of the national capacity if 
nuclear plants are shuttered.  Flemish Minister of 
Environment Kris Peeters conceded recently that achieving 
Belgium,s Kyoto objectives would be inconceivable if the 
nuclear energy option were excluded. 
 
¶7.  (U) Economically, price stability is best assured by 
minimizing oil and gas imports.  Belgian businesses pay 
electricity rates above those in France (11.16 cents/kilowatt 
hour versus 9.05), but lower than those in Germany (13.34). 
Belgian electricity rates have fallen by 5 percent since 
2000, their relative stability versus other forms of energy 
has been due to the low level of imports needed to supply the 
national grid.  Belgium,s Employers' Federation (FEB/VBO) 
and the local American Chamber of Commerce have listed high 
energy costs as a competitiveness concern for operating in 
Belgium.  Greater uncertainty in Belgium,s electricity rates 
with the closure of nuclear plants would not enhance the 
Belgian investment climate. 
 
------------------------- 
EU Interest Evokes Enmity 
------------------------- 
¶8. (U)  Despite the fact that the European Atomic Energy 
Community (EURATOM) was one of the founding institutions that 
motivated European countries to organize the supranational 
mechanisms that evolved into today,s European Union, EU 
policy input regarding nuclear energy is slim.  The demise of 
a European consensus in the 1980s about nuclear energy,s 
desirability left the Commission little basis for action in 
the field.  Nuclear energy policy is chiefly the domain of 
the member states, coordinated through international 
organizations such as the IAEA.  EU policy initiatives 
regarding nuclear power have focused on safety and waste 
management issues.  Nonetheless, the EU Greenpaper on Energy 
Supply, issued March 8, 2006, distinctly kept nuclear energy 
open as an option for those states that wished to pursue that 
technology. 
 
----------------- 
The Only Option 
----------------- 
¶9. (SBU) Having little guidance from the EU, Belgium has 
continued to pursue security of its electricity supply 
through nuclear power.  Since establishing its first reactor 
and nuclear research center in 1955, Belgium has built and 
operated seven nuclear power reactors, and in 1986 developed 
the mixed-oxide reprocessing technology to produce fuel rods 
from plutonium dioxide and uranium dioxide.  The nuclear 
industry directly employs over 6,000 Belgians, and another 
35,000 work for Tractebel, the engineering firm allied with 
Electrabel.  The contribution of the nuclear industry to 
Belgium's energy security and price stability in a nation 
devoid of most resources is significant.  Belgium,s Federal 
Planning Office foresees domestic electricity demand growing 
at the rate of 1.2 percent annually until 2030.  The Gol 
Report observes that the planned decommissioning of all 
nuclear plants from 2015-2025 would create a gap in the 
nation,s energy supply and significantly change Belgium,s 
energy context.  Greater dependence on imports of gas, oil or 
low-sulfur coal would be the natural result, with the 
attendant political risk. No one overtly advocates for 
nuclear power; it simply remains the only realistic option 
left. 
 
¶10. (SBU) Belgian media report that replacing over 5800 
megawatts of generating power starting in 2015 would entail 
 
BRUSSELS 00003799  003 OF 003 
 
 
20 billion euros of investment, depending on the type of 
generating plants to be constructed.  The business sector and 
the Gol Report agree that creating the right mix of 
investment incentives, tariff policies, and regulations will 
be essential to assure the country enough power in the future 
through private sector investment.  Revising the 2003 law on 
decommissioning has also been proposed by some; extending the 
useable life of existing nuclear plants to 50 or 60 years may 
be considered.  A projection by the Federal Planning Office 
of Belgium claims new nuclear facilities would cost the 
economy 0.6 percent of GDP annually in 2030; with replacement 
gas turbine/cogeneration facilities, the cost to the economy 
would be 2.7 percent of GDP, and an added drawback of 38 
percent higher CO2 emissions than Belgium emitted in 1990, 
the Kyoto baseline. 
 
------- 
COMMENT 
------- 
¶11. (SBU) While none of the reports come down squarely 
against present Belgian policy to phase out nuclear energy, 
in terms of political and economic sustainability 
(reliability and cost), environmental sustainability (reduced 
emissions), and social sustainability (affordability) they 
all clearly opt for including nuclear power generation in the 
future.  Less than nine years remain before decommissioning 
of Belgium,s nuclear capacity should start; the timeframe is 
tight for investment and construction of alternatives.  The 
challenge for Belgium,s leaders is to align political will 
with environmental, economic and financial realities. 
Federal elections in May 2007 will impede decisionmaking, as 
politicians will avoid this hot issue during their campaigns. 
 In general, Belgian socialist parties and green parties 
oppose nuclear power, while conservative Christian democratic 
parties (CD&V and CDH) back it.  This leaves the politically 
troubled liberal parties (Flemish VLD and Francophone MR) in 
the balancing and coalition-building role, a difficult task 
for a weakened political team. 
 
Korologos 
.