Slovenia: TPP Sostanj 6 will operate with loss with a relatively low coal price, SEE Energy News
The next year starts a period of 23 years in which HSE energy company, as the owner of TPP must repay the loan of over a billion and a half EUR for the construction of the sixth plant unit, which according to the analysis could operate with a loss.
TPP Sostanj 6, a new unit of 600 MW should replace outdated five units in the same complex, and it will be operational in the next 40 years. In the beginning, it was estimated it would cost 602 MEUR, create 3,500 jobs and generate financial gains. In reality, already built unit has reached the price of 1.43 billion EUR, employed about 450 people, half of them expected the imminent cancellation due to poor plant operation. Focus Association presented the economic calculation according to which the TPPS 6 would create annual losses of about 70 to 80 MEUR if electricity prices remained at the current level.
With corruption, the reason for the poor operation of Sostanj is the wrong economic analysis which assumes the high electricity costs. “However, prices have recently fallen and it is likely to remain so. If it works at full capacity, TPP Sostanj 6 will generate annual losses of 70 – 80MEUR, which will eventually cover Slovenian citizens, given that HSE, owner of TPP Sostanj, is the state company”, says Focus. Finances emphasize that the current price on the stock exchange in Leipzig is around 40 EUR per MWh. According to the latest investment program the MWh production in TPPS 6 in the first year of operation will cost 46 EUR, and then will increase to 55 EUR, and then it will reach 59 EUR per MWh by 2018. It is estimated that the coal price for the power plant will amount to 2.25 EUR per GJ. Management Boards of HSE and Velenje coal mine have recently stated that this price was hardly “attainable”. The increase in the coal price, of course, would increase the electricity production in the power plant.
According to Focus analysis that refers to the content of the current police investigation, an incredible increase in the building cost is one of the most important causes for gain of about 285 MEUR, which has earned the main contractor, French Alstom. Earlier this year Slovenian police announced that ten people have been charged for fraud in connection with Alstom’s illegal activities. Slovenian Prime Minister asked the Ministry of Finance and the Ministry of Justice to investigate the possibility of drafting a law on the revision of the project TPP Sostanj 6. Revision would establish the basis for prosecuting those responsible for the consequences of this project.