Corruption in Russian Nuclear Industry
If corruption in general is dangerous, it is quite deadly when it happens in the nuclear industry. The ecological group Ecodefense! believes the risks are high enough to result in another Fukushima, while the National Anti-Corruption Committee (NAC) has urged Prime Minister Vladimir Putin and Prosecutor General Yury Chaika to initiate investigations into the broadly reported violations and abuses in the nuclear industry, including at new nuclear power plant (NPP) construction sites.
The NAC further refers to reports by the official national daily RossiiskayaGazeta as it says: “[…] in the past six months alone, removed from their posts on suspicion of corruption and other abuses were heads of twelve Rosatom enterprises. In 2010, 35 industry officials were dismissed for the same reasons. In a notorious development last summer, officials with the Main Department for Economic Security and Countering Corruption of the Ministry of Interior of the Russian Federation detained former Rosatom deputy director YevgenyYevstratov and charged him with embezzling budget funds allocated toward the construction of a number of the corporation’s sites.”
Some of the details concerning the urgent issue of “abuses perpetrated with respect to the industry’s purchases in NPP construction and modernisation projects,” as highlighted by the NAC, which cites media reports, are, in particular, purchases of technological equipment for the cooling towers of the fourth reactor of Kalinin NPP, in Udomlya (some 200 kilometres northwest of Moscow) and the second line of construction at Leningrad NPP, near St. Petersburg:
“Recently, equipment purchases for NPPs have been conducted outside the tender procedure, which is contrary to the law. […] a specially issued regulation […] adopted in 2007 by [Rosatom’s daughter company, national NPP operator] Concern Rosenergoatom allows for the selection of equipment to be bought without conducting a tender – or solely based upon the decision of the design organisation.”
The consequences of corruption schemes that are allegedly employed by Rosatom companies – such as the use of counterfeit and non-certified equipment in the construction of new nuclear reactors – could not have escaped the scrutiny of the federal industrial and ecological safety oversight agency, Rostekhnadzor. As evidenced by facts published in Rostekhnadzor’s yearly report of 2009, new reactor construction is compromised by run-of-the-mill theft – perpetrators substitute cheaper, subquality materials for the ones approved for construction. The federal service reports, for instance, the following incidents at the construction sites of Rostov and Leningrad NPPs:
Problems that apparently plague the construction of new reactors in Russia finally manifested themselves vividly on July 17, 2011, in the crumbling of steel structures and the carcass of a containment building under construction for a new reactor at the site of Leningrad NPP-2.
Besides implementing a number of domestic projects, Rosatom is also building or preparing to build new reactors in other countries – such as the former USSR republics of Ukraine and Belarus, where environmentalists and NGOs are likewise concerned that corruption and below-par construction quality may eventually affect the safety of the future reactors.
“The numerous violations of construction norms and standards, and working conditions, which lead to even serious incidents at NPP construction sites in Russia, cast doubt on the capability of the State Corporation Rosatom and its subcontractor companies of carrying out quality and reliable construction projects as per [Rosatom’s] export contracts, in particular, in Ukraine,” said, for instance, a statement on the website of the National Ecological Centre of Ukraine.
And the Belarusian Anti-Nuclear Campaign, which is one among many Russian and Belarusian organisations trying to prevent the construction, in Belarus’s town of Ostrovets, of a new nuclear power plant to an as-yet untested Rosatom design, wrote this in an address to Russia’s Putin and Belarus’s President Alexander Lukashenko: “The known incidents and deficiencies in the operation and construction of Russian-built NPPs in Russia, Iran, and China, as well as the recent collapse of reinforcing steelwork at the construction site of the containment building at [Leningrad] NPP-2, are evidence that Rosatom and its structures have serious problems of a systemic nature and cannot guarantee the quality of their sites. This propagation of dangerous nuclear technologies places a special responsibility on the Russian government.”
What the Belarusian Anti-Nuclear Campaign is referring to is the less than perfect performance record Rosatom has been showing in its international construction contracts, such as problems with completing and launching the reactor at Iran’s Bushehr or the 3,000 or so complaints brought by China to Rosatom’s notice with regard to the quality of the equipment supplied to a station Rosatom is building there.
At the end of 2010, the Moscow-based ecological group Ecodefense! and Transparency International Russia presented a study that took a look at corruption risks in Rosatom’s purchasing practices – the results of an analysis of some 300 orders placed by the state corporation and posted on its website for open access.
At issue are contracts concluded by Rosatom with external organisations for goods or services needed for particular projects – orders paid with budget funding – and the study highlights prominent corruption risks present in Rosatom’s purchasing activities. Because of a special status the corporation enjoys in the country, Ecodefense! and Transparency International Russia conclude, Rosatom’s purchases are not subject to the jurisdiction of the federal law that establishes procedure for procuring goods or services for state or municipal needs. And even though Rosatom itself provides a set of guidelines for such activities in its Unified Industry Purchases Standard, the restrictions these impose on the purchaser or ordering party are less clearly defined than in that federal law.
Furthermore, a monitoring study of a selected sample of 200 purchasing agreements made by Rosatom revealed numerous violations of the Industry Standard, such as with, for instance, the selection of a particular method for placing an order, failure to provide cost estimate documentation when ordering construction or renovation works, and more.
Altogether, violations of Rosatom’s own purchasing standard were found in 83 contracts – 27 percent of the total sample or 41 percent of the 200 contracts selected for in-depth analysis. Another conclusion was that the laws and regulations that govern Rosatom’s activities where buying goods and services for the corporation’s needs is concerned are fraught with serious deficiencies that leave ample room for corruption risks.
“Corruption in the nuclear industry leads to an impaired safety culture, substandard construction quality, and, as a result, accidents at nuclear sites. With respect to Rosatom, there is no outside control, so there are truly gigantic opportunities there for corruption,” Ecodefense!’s co-chair Vladimir Slivyak told Bellona. “There was corruption [within Rosatom] before, too […] But it is just recently, brought along with a new wave of NPP construction, that corruption processes [within Rosatom] may have reached a record high in the [corporation’s] history.
Rosatom’s former functionary Yevstratov was charged with embezzling 50 million roubles ($1.8 million) in state funding earmarked for the development of spent fuel management technologies. The arrest was hailed as a success in an anti-corruption crusade undertaken jointly by Rosatom and the Ministry of Interior, but it did not look convincing to Bellona’s Alexander Nikitin.
Nikitin, who heads the St. Petersburg-based Environment and Right Center Bellona, said that the term “corruption” is tossed around in contemporary Russia as frequently as charges of espionage, and that a possible explanation for the arrest could be Rosatom’s ardent post-Fukushima efforts to polish its image – something that would make Yevstratov, the head of safety programmes, a sitting duck for an anti-corruption sweep.
 Corruption: A new Russian Fukushima in the making? (2011 article).
- NPCIL,AERB and KKNPP Dodge the Substandard Equipment Issue (kractivist.wordpress.com)