CEZ signed a memorandum for the construction of two nuclear power units

• Despite the decision of the court in Brno, CEZ signed a contract with KHNP for the construction of nuclear units.
• France's EDF has filed an appeal with the Antitrust Office, which is still pending.
• The contract worth $18 billion has become a bone of contention in relations between the Czech Republic and France.

Yesterday, a court in Brno blocked the possibility of signing an agreement between the Czech energy company CEZ and the South Korean company KHNP on the construction of two nuclear units on the site of the operating nuclear power plant in Dukovany.

The application to suspend activities related to this investment was submitted by the French state-owned company EDF, whose offer in the tender procedure was rejected by the government commission.

In 2022, the Czech Republic established the special purpose vehicle EDU II (Dukovany II Power Plant), which was designated as an investor in the construction of new nuclear units at the operating Dukovany Power Plant.

The company is owned by the state, with the remaining 20% ​​by the Czech Energy Company (CEZ). The Czech State Treasury holds 69.78% of CEZ shares.

Currently, there are four reactors operating there, each with a capacity of 500 MW. In order to strengthen energy independence, a decision was made to start proceedings regarding the contractor for two more units.

In 2022, a tender was announced for the construction of two nuclear units in Dukovany

In 2022, the tender conditions were announced, but for security reasons, the Russian Rosatom was excluded. At the end of 2023, it turned out that three offers had been submitted.

Due to the lack of full documentation and calculations of construction costs, the offer from the American concern Westinghouse was not considered.

France's EDF and South Korea's KHNP remained in the running. In July 2024, the South Korean bid was selected to build new blocks.

No details were given about the decision and the arguments that influenced this choice, but the French side raised the issue of the low price and worse technical parameters proposed by the Koreans.

The French also submitted a request to the European Commission to analyse the reasons for entrusting such a large investment to a non-EU company despite the available technology offered by EDF.

As part of the appeal procedure, the Antimonopoly Office of the Czech Republic was also contacted . The proceedings did not end with a ruling, so the Court in Brno yesterday blocked the signing of the contract with the KHNP company.

In the meantime, representatives of Korean companies arrived in Prague, who were supposed to initial the contract today. Czech Prime Minister Petr Fiala was supposed to attend the ceremony, but he wrote on the X platform that he respects the decisions of the courts.

The value of the investment, together with the accompanying infrastructure, is estimated at USD 18 billion.

However, the development of events is very dynamic, as CEZ decided to ignore the court's ruling and, despite many procedural objections, a contract, agreement and memorandum were signed today between representatives of KHNP and Czech companies that will be involved as subcontractors.

The construction of new nuclear units in Dukovany is a necessary project for Czech energy security and self-sufficiency of the country. Czech households and the Czech economy must be sure that there will be enough energy at affordable prices to maintain the quality of life, prosperity and ensure the competitiveness of Czech industry - wrote CEZ on social media after signing the agreement

This action further complicated the legal situation and demonstrated the Czech government's determination to have the Koreans implement the project.

For the French side, and especially President Emmanuel Macron, who has been personally involved in promoting EDF as a technology supplier, such behavior is difficult to understand.

There are many indications that the fight for the construction of two Czech nuclear units is not over yet.