News item | 2010-06-01 | 08:40 AM

Energy News Europe - week 21, 2010

Belgium

Energy companies face new challenges with CO2 reduction
L'Echo, 2010-05-25
According to analysts from Dexia, Belgium's commitment to reduce its CO2 emissions by 20% through energy saving programmes will have a negative impact on the traditional energy company business model. In 2009 McKinsey estimated that Belgium would make annual savings of EUR 5.2bn (USD 6.42bn) through energy saving programmes by 2030.

It is thought that energy companies will have to adopt a new business model, adding energy saving services to their traditional services in order to profit from an expected growth of 14% between 2009 and 2014 in such services compared to a 1% increase in electricity sales per year over the same period.
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Bulgaria

EVN, International Power interested in Maritsa East stake
Novinite, 2010-05-21
Austrian utility firm EVN and UK utility International Power are both said to be interested in acquiring a stake of 73% in Bulgaria's Maritsa East 3 coal-fired power plant, which is being sold off by Italy's Enel. It has been reported that talks over the acquisition of the stake have already begun. The plant has a capacity of 908 MW and supplies power to 1.6mn people in the southeast of the country. The remaining 27% stake in the plant is held by the Bulgarian government, which recently said that sale of the stake could earn it EUR 200mn (USD 250.71mn).
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Finland

Cost of planned wind power projects may be EUR 23bn
Energia, 2010-05-26
In Finland, news of new wind energy production sites are published all the time. According to the Finnish Wind Power Association, the capacity of planned projects in April 2010 had already exceeded 9,000 megawatts. The capacity to be built on land is 1,900-2,900. According to the magazine's estimate, the cost of building this capacity would be EUR 3.2bn-4.9bn. The capacity of offshore projects is 6,100 megawatts and the estimated cost EUR 18.3bn.
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France

Commission debates Nome electricity market bill
Les Echos, 2010-05-25
The commission of economic affairs of the French parliament is debating the bill on the new organisation of the electricity market Nome. Following the conclusions of the commission, Nome will be debated in parliament from 8 to 10 June 2010 and then in the Senate. MPs submitted 142 amendments as different actors in the market try to influence the bill. One amendment proposes that the volumes of hydraulic electricity produced by energy companies would be subtracted from the volume of nuclear electricity EDF must sell at set prices to other actors.

This would penalise GDF Suez which produces 13 Twh per year through its hydraulic electricity subsidiary Compagnie du Rhône. Smaller energy groups welcome such an amendment. EDF has a monopoly for nuclear power in France, which covers 80% of electricity use. GDF Suez and other groups such as Poweo and Alpiq fear that the regulated price will not allow them to compete with EDF on all segments. EDF wants a minimal price of EUR 42 (USD 52) per MW but the commissions estimates the fair minimum price to be EUR 37 (USD 46).
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Germany

Wind technology repowering
Weser Kurier, 2010-05-21
German wind energy institute DEWI estimates that repowering of 6,300 out of Germany's 22,000 wind power units could be economically feasible. Klaus Meyer, chief executive of Bremen-based project developer WPD, estimates that 1,000 to 1,500 units could be replaced per year. Another Bremen-based company, Deutsche Windtechnik (DWT), in which Meyer is supervisory board chairman, aims to dismantle no less than 20 old wind power units in 2010.

According to managing director Matthias Brandt, in 2011 the number might rise to between 60 and 80. DWT, which provides repair and maintenance services for more than 1,000 wind power units of different manufacturers, aims to build up Repowering into its third core business, besides Onshore and Offshore services. Last financial year DWT posted a turnover of EUR 15mn (USD 18.26mn). The figure has been growing at an annual rate of 25% to 30%.
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Italy

GDZ Suez wishes to develop in Italy
Le Figaro, 2010-05-27
Gérard Mestrallet, CEO of GDF Suez, has said he is ready to put in place partnerships in order to develop his company in the Italian nuclear energy sector. GDF Suez would not do so alone but would require at least two European or Italian partners. Mestrallet says he is confident of the outcome of negotiations over the joint company with the Italian group Acea. The town of Rome owns 51% of Acea and Francesco Gaetano Caltagirone owns 10%.

Caltagirone was not satisfied with the joint company. Mestrallet is also to enter exclusive negotiations with Oman for building two electric power plants using a combined gas cycle. The Barka III and Sohar II plants are each to have capacity of 750MW. GDF Suez has offered a price which includes the state buying production over 15 years. Mestrallet said that France has not yet given an answer on the possible construction of a new nuclear power plant in the Rhône valley. It would use the 1,000MW Atmea reactor designed by Areva and Mitsubishi and would be operation after 2020. It would be built either in Tricastin or Marcoule.
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Netherlands

40% of authorities to finance energy production
Het Financieele Dagblad, 2010-05-25
According to a study by Tensor Energy, some 40% of local authorities are planning to use the revenues from the privatisation of the energy companies to finance sustainable energy production themselves. This is to take place in partnership with other parties. Employers association VNO-NCW has expressed concern. Firstly because, parties had reached an agreement that energy production would be in private hands and secondly because the tax payer will pay for any failures.
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Norway

Hydro to invest up to NOK 3bn in hydropower
Dagens Næringsliv, 2010-05-25
Norwegian aluminium company Norsk Hydro plans to invest between NOK 2bn (EUR 248.34mn USD 306.65mn) and NOK 3bn in hydropower in Norway in the next 5-6 years to raise its power production by 10% or 1 TWh. At present it has a power production of 9.4 TWh per year, but it uses about 14 TWh per year on its aluminium production in the country.

The first project to be launched is an extension of the hydropower production at its aluminium plant in Årdal by 84 GWh. This work will start this autumn, costing about NOK 250mn. Hydro has also applied for concessions for two hydropower projects in Fortunsdalen in Sogn with a capacity of 98 and 111 GWh. Other projects are also being planned.
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Poland

50 Hertz Transmission and PSE Operator found joint venture
Financial Times Deutschland, 2010-05-26
German grid operator 50 Hertz Transmission and Polish grid company PSE Operator founded a joint venture for the preparation of the construction of an extra-high voltage line which would be able to transport the production of a complete nuclear power plant. Up to present, there exist only two connections between the German and Polish electricity networks.

According to a spokeswoman, the companies expect that the joint venture will be entered into the trade register in summer 2010. The German federal cartel office recently approved the joint venture called Gerpol, in which both companies own a 50% stake. According to industry estimates, the investments might amount to a three-digit million sum. The new company is to be based in Poznan.
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Spain

Endesa partnership to receive EC funding for CCS project
Utility Week, 2010-05-24
A partnership between Foster Wheeler, Endesa, and Fundación Ciudad de la Energía has won EUR 180mn (USD 222.26mn) in funding from the European Commission's European Economic Recovery Plan in order to build a 30MW carbon capture and storage (CCS) demonstration project in Spain.

The plant will be sited at Endesa's El Bierzo-based Compostilla II power station. The CCS project will use oxy-fuel technology to produce flue gas comprised of CO2 and water vapour, and is intended to be operational by 2012. The partnership is also planning to build a 300MW CCS plant before 2015, and is looking for financing.
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United Kingdom

Survey shows decline in concern over climate change
Guardian, 2010-05-23
According to a YouGov survey of 4,300 UK adults, 62% are concerned about climate change, compared with 80% in 2006 and 71% in 2009, while 80% say they are concerned about where the UK's electricity supply comes from, down from 82% in 2009. The survey, which was commissioned by French energy group EDF, also showed that UK adults are more in favour of nuclear power generation, with a 'favourability' rating of , compared with in 2007
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Ofgem wants tough regulations on electricity company mergers
Telegraph (UK), 2010-05-26
UK energy regulator Ofgem has stated that it wants electricity distribution network operators, such as EDF and National Grid, to be subject to tough regulatory restrictions on mergers and takeovers, as water companies in the UK are. The move comes as EDF considers a number of bids for its GBP 4bn (EUR 4.67bn USD 5.76bn) electricity network business, including a possible sale to Scottish & Southern Energy (SSE).
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