Serbia: Edison & EPS power utility JV project New TPP Kolubara B, status unclear

10. April 2015. / News Serbia Energy

The project should be jointly developed by EPS and Italian Edison. TPP Kolubara B will be lignite fired plant and it will be replacement capacity for several older TPPs in Serbia. New power plant will have 750 MW output, while overall cost of the project is estimated to around 1 billion EUR.

The construction of TPP Kolubara B has started in 1988, but it was stopped due to lack of funds. In June 2011, EPS and Edison signed the preliminary agreement for construction of TPP Kolubara B, since Edison won in the tender for strategic partnership and it proposed the construction of two 375 MW units. According to Edison’s proposal, EPS should own 36.4 % stake in the future plant, which is the worth of already installed equipment and carried out works. EPS has already invested some 300 million EUR in the project.

In the beginning of May 2012, government handed over the letter of support to EPS and Italian Edison for the development of the TPP Kolubara B. Project finance manager of Edison said that the next step in the project would be establishment of joint venture company and preparation of the feasibility study, in order to start the project during 2013. According to original plans, the TPP Kolubara B should be put in service in 2017. European Bank for Reconstruction and Development (EBRD) has entered the final phase for approving the 400 million euros loan for the project.

Partly constructed TPP Kolubara B is located around 40 km southwest from Belgrade. It was predicted to be a combined cycle power plant, producing both thermal and electric energy. Thermal energy was planned to be delivered to Belgrade and be used for district heating. By original project, power plant would have two 350 MW units.

The plant is constructed in the close vicinity of the open-pit-mine Tamnava-West Field, from which it will be supplied with coal. The construction started in 1988, and a part of the equipment has been contracted and partially delivered (95% of the imported boiler (Canadian Combustion and local Minel Kotlogradnja), steel supporting frame, generator transformers and generators). Civil and design works are also partially contacted and implemented. About 40% of the estimated investments have been implemented. By that estimation, 300 million EUR have been spent into construction and equipment. For completion of this project it is necessary to invest additional 540 million EUR for construction completion and around 200 million EUR for coal mine. According to some estimation, TPP will have a closed cooling system. The problem lies in the fact that the delivered equipment is considered as old fashioned, and that the part of already invested 300million EUR must be reinvested. Power plant is expected to be finished in 2017 at earliest, and would be built in accordance to EU standards that will be in power in 2016. The TPP will have older technology so its efficiency will be 35 %.

During September 2013, several media announced that EBRD is not interested in funding the construction of TPP Kolubara, although official announcement has not been published by EBRD. Commenting the recent news, deputy Minister of energy, development and natural protection Dejan Trifunovic said that the Ministry questions the profitability and sustainability of the project, especially in terms of price of electricity and environmental risks.

It is estimated that TPP Kolubara B will need at least 6 million tons of coal for one year of operation.

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