Serbia exclusive: The construction of gas power plants in Serbia by Gazprom, the report

Published on 7. April 2014., News Serbia Energy

“The Petroleum Industry of Serbia” and “Gazprom Energoholding” signed memorandum on the construction of steam-gas thermal power plant in Pancevo last year in September. It has been anticipated that 51 percent of the stake in the capital share of the new company belongs to the group “Gazprom Energoholding” which will build thermal power plant and 49 percent to NIS. “Gazprom Energoholding” is the subsidiary “Gazprom” company, which is the largest owner of power assets in Russia. The majority NIS owner is the Russian company “Gazprom Neft”.

Electrical and thermal energy that would be produced in the gas plant, primarily will supply with power the refinery NIS in Pancevo and Petrochemical plant HIP “Petrohemija”, in which NIS is strategic partner. It is planned that the remaining amount of electricity be sold in the energy market of Serbia, which will soon be fully liberalized.

Construction of the steam – gas power plant is economically and ecologically most efficient solution. This technology provides a high coefficient of efficiency and low fuel consumption. This will allow costs reduction of electricity procurement for the refinery NIS and petrochemical plant HIP “Petrohemija”. Fuel for the thermal power plant will be natural gas – environmentally the cleanest energy resource. Construction of gas TPP only makes sense there is an agreement on the gas price from which electricity would be produced. Experts also point out that the construction work will be cost provided to build gas power plants with modern, efficient units and that natural gas costs from 330 to 350 dollars for 1000 cubic meters. The price of gas, after the construction of South Stream, should be cheaper. It is undisputed that “Gazprom” has a monopoly on the Russian gas export; prices of Russian gas vary from country to country.

The South Stream pipeline will bring great benefit to Serbia and investments worth 1.7 billion EUR, as estimate experts. The benefit of South Stream for Serbia is huge and this pipeline frees us of energy dependence and help us to be included in the map of European gas pipeline.

South Stream is important also because Serbia, when the pipeline passes through our territory, will be able to build a gas power plant for electricity production, which is increasingly imported, and also because of the growing demands for green kilowatts and the obligations fulfillment related to reduction of air pollution. Huge gas amounts will pass through South Stream to central and southern Europe, over our territory, of which Serbia will also have great benefit because of the transit fees payment.

Construction of gas power plants in Belgrade, Nis, Novi Sad and Pancevo are projects of national importance. The capacity of these plants would be at 450MW. Construction of gas thermal power plants significantly contributes to the improvement of the capacity and safety of electricity, especially in situations of rapid needs for the difference compensation between the actual demand and the electricity availability in the system.

Natural gas is an energy source with a strong technical and environmental advantages over other conventional fuels, and in this sense, should provide a significant contribution to more efficient and environmentally friendly energy use. However, natural gas is predominantly imported fuel and its price is, for now, tied to changes in oil prices on the world market.

Natural gas production in our country currently meets about 20 percent of domestic consumption with the expected trend of decline, and it is significant presence of low-calorie gases in balance reserves (with high content of CO2, nitrogen, etc…) which are not suitable for direct connection to the pipeline system. Also of great importance in the gas sector of the Republic of Serbia is the implementation of the South Stream pipeline. This transnational pipeline should provide a secure supply with natural gas of Europe and the entire region in the future.

Gas plants have an advantage when it comes to meeting environmental standards. Gas burns up to 98 percent in the consumption place and does not emit almost any harmful ingredients. Chapter 27, about the environment, is one of the most serious and difficult negotiations with the European Union. In the European Parliament resolution on Serbia’s progress in 2013^th it is estimated that Serbia lags behind the other candidate countries in the use of renewable energy sources and there is a very little progress in the area of environmental protection and the prevention of climate change.

Source; Serbia Energy