Montenegro: TPP Pljevlja could lose market share in upcoming electricity market liberalization

29. April 2014. / SEE Energy News

Study: TPP and Mine could lose market share. The old thermal power and coal mine in front of  many challenges. The existing premise of power plant in Pljevlja and the Coal Mine will be exposed to international competition by the opening of the electricity market in Montenegro, starting from January next year. EPCG Power utility company owns the TPP Pljevlja, EPCG is partially owned by A2A Italy.

These premises can withstand the competition under condition of doing without expenses of investment maintenance, costs of new investments, expansion activities, while improving the current level of efficiency.

The opposite attempt may result in loss of market share and likely closure of both facilities in a relatively short period of time, all under the absence of state aid in accordance with European Union regulations. It is stated in the conclusion of the study “The energy complex development  Pljevlja”, which was presented yesterday in Podgorica.

The study notes that can’t be constituted the public interest to continue the operation of the Mine and TPP in their present form, or construction of a second thermal block which use only lignite as the main fuel.

The study was ordered by the NGO Green Home, and its authors were Aleksandar Kovacevic and Eduard Kotri.  In the conclusions of the study has been noted  that in the available resources, there is no economically accessible coal for operation of possible new block of TPP Pljevlja “in a expecting life time of 30 years or more.”

“The try to provide the required amount of coal could lead to unsustainable compromises in terms of a disposal of private property, land, environment … From this circumstance follows the conclusion that the new facility of TPP Pljevlja II by using lignite as the main fuel, probably would not be competitive in the future energy market, “according to the conclusion of the study.

The authors believe that the existing buildings of TPP Pljevlja will not work longer than the next seven years.

“In that period will be completed the lifetime of the power plant and it will probably work shorter,” according to in the conclusions, among others.

The study notes that can  constitute the public interest to continue the operation of the mine and in its present form, ie, construction of a second thermal block using only coal as the main fuel.

It is the about commercial objects and they have to be built without state’s assistance.

“Lenders and the Mine owners have to face the risk of bankruptcy. If nothing changes this company will be at unacceptable high risk that it can’t continue functioning economically; the TPP will not be able to continue to consume the coal, on the other hand TPP Pljevlja II will not be constructed based on use of lignite as the main fuel, “says in the study, noting that there is an alternative that it could grow in the more complex energy company that will be involved in production of forest biomass.

Source; Sebia Energy See Desk

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