Croatia: Alstom is main supplier of equipment for Plomin C,will the project’s price go up for Marubeni?

18. February 2015. / SEE Energy News

The French government intends to stop with giving incentivesfor coal in developing countries, byceasing to give tax relievesforconstruction ofcoal-firedthermal power plants. This will affect Alstom, the French energy company that started many projects overseas, and at the same time cooperates with Marubeny as the main supplier of equipment in the project ofconstruction of HEP’s coal-fired thermal power plant, Plomin C.

French Prime Minister Manuel Valls said that French public funds will no longer be used for coal-fired thermal power plants in developing countries “without CO2 storage system”. However, CCS technology is just in developing stage, only a handful of projects implement it, and several big energy companies recently withdrew from the European CCS research project. When the new rules will come into force,was not stated. Segolene Royal, Minister of Environmental Protection said that conditions and the timefor the withdrawal of these privileges should be knownsoon, in consultation with thebusinessmen involved in that field.

Alstom is planning manyprojects in the south, using government privileges. Developments in France are extremely important for HEP because this means that the price of the project Plomin C 500 MW on coal, could maybe go up from the current 800 million to one billion euros to a much higher amount, because Alstom’s equipment will no longer enjoy export privileges. Price of the project, of course, will reflect itselfon the price of energy which HEP should be repurchasing from Marubeny, so inthat case the viability of the project may come intoquestion.

Incentives for coal are granted via French export agency Coface, which since 2011 guaranteed for ‘coal projects’ worth around 1.2 billion euros and is the fifth largest coal incentives provider among the countries members ofthe OECD organization thatgrantsexporting loans. Coface recently gave Alstom guarantees for one South African coal-fired thermal power plant which should start operating in mid-2015, and which should have a CCS system. The European Commission has less ambitious goalsin thatfield,compared to France, and according to a document seen by Euractivitsuggests only ending of providing incentivesfor the dirtiest thermal power plants, and encourages the OECD and IEA toconduct additional analyzes on the technical aspects of “clean coal”.

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