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. Last Updated: 07/27/2016

Nuclear Minister Calls For Corruption Probe




Nuclear Power Minister Yevgeny Adamov on Wednesday called for a criminal investigation into corruption and embezzlement at Rosenergoatom, a state-owned company that runs the commercial operations of Russia's nuclear power stations.


At a news conference, Adamov said he had sent a letter to Prosecutor General Yury Skuratov in October, asking him to look into the theft of millions of dollars from Rosenergoatom.


Adamov said that Rosenergoatom officials were stealing money using complicated barter deals and payments in IOUs rather than in cash.


"The greater portion of money has not surfaced. It simply disappeared in the swamp of endless barter deals and dud IOUs," Adamov said. "And this swamp has started to swallow up some decent, not-so-decent and not-decent-at-all people," he said.


Rosenergoatom's nuclear power plants generate about 20 percent of the country's electricity, which should earn about 17 billion rubles a year ($850 million), according to Nuclear Power Ministry officials.


But Unified Energy Systems, the national electricity company that buys the power and distributes it through the national energy grid, pays for less than 7 percent of the power in cash. The rest is settled with barter deals and IOUs, or promissory notes, which are difficult to track and leave room for corruption.


The Nuclear Power Ministry says that, even after these deals, UES still owes Rosenergoatom about 19 billion rubles, more than a year of bills.


The corruption in Rosenergoatom occurs against a backdrop of funding cuts and protests by unpaid workers at Russia's nuclear plants.


Adamov, who took over as nuclear power minister in March, refused to name any of the officials he accused of corruption in his letter to Skuratov on Oct. 16.


But Yevgeny Ignatenko, the former director of Rosenergoatom whom Adamov removed from power Oct. 12 said in a telephone interview that he was certain Adamov had included him in the accusations. Ignatenko is now deputy director of Rosenergoatom.


Also in October, three of Ignatenko's managers responsible for dealing with the State Duma, the lower house of parliament, and the government were fired.


Adamov said he had ordered a financial audit at Rosenergoatom and said that, after its completion in about two weeks, the Prosecutor General's office could take on the investigation.


But Ignatenko dismissed the results of the audit as biased. "In situations like this, an independent auditor should be named, but here the ministry's own financial department is doing the review," he said. "It is basically a witch-hunt."


Ignatenko was replaced by Leonid Melamed, who used to work for UES. He is resented by many in the nuclear power industry because he is an outsider. But after his arrival, Rosenergoatom and UES signed an agreement guaranteeing a larger portion of payments would be made in cash.


Adamov said that since the deal and the change in the management, cash income at Rosenergoatom has been four or five times higher.


The move to clean house could be part of a larger fight over the control of the Nuclear Power Ministry, which, despite its domestic problems, is a major source of hard-currency earnings. The ministry sells nuclear power plants to such countries as Iran and China, exports uranium from warheads to the United States and accepts spent nuclear fuel from nuclear reactors in Eastern Europe. Some estimates put the ministry's annual revenues in the billions of dollars.


Vladimir Orlov, director of PIR Center, a nuclear-issues think tank, said that control of the Nuclear Power Ministry was especially crucial in the light of the upcoming parliamentary and presidential elections.