News item | 2011-10-04 | 08:45 AM

Energy News Europe - week 39, 2011

Czech Republic

CEZ plans investments in several energy projects
Ziarul Financiar, 2011-09-26
The Czech energy group CEZ plans to build new renewable energy projects, such as hydro power stations and wind energy units, in several countries including Romania, Poland and Germany, according to the managing director Daniel Benes. The company is also planning to attract a financing worth CZK 200bn (EUR 8.11bn USD 10.96bn) for investments in the construction of a new nuclear power station at Temelin.
© Esmerk

Denmark

Underground shale deposits estimated to be rich in natural gas
Ingeniøren, 2011-09-28
Underground shale deposits in Denmark are deemed to be among the most gas-rich shale formations in Europe in terms of TOC (total organic carbon) values. This according to the Geological Survey of Denmark and Greenland (GEUS). The TOC value of the shale is up to 14%. French oil and gas company Total has announced that it will start test drilling for gas in Denmark towards the end of 2012 and expects to have a 10-30% chance of finding profitable gas reserves.
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Europe

European Commission raids offices of RWE, Vemex and several other gascompanies
iDNES, 2011-09-27
The European Commission (EC) has raided offices of several gas companies in Europe because of alleged breaches of competition rules. Although the EC has not disclosed names of countries and firms which were raided, RWE Transgas of the Czech Republic has admitted that inspectors visited RWE, RWE Transgas and RWE Supply & Trading. Vemex, a subsidiary of Gazprom Germania, was raided too. The company has said that it considers it to be a standard control and is sure that it did not break rules.

Other companies which were reportedly visited by the EC inspectors are E.On Ruhrgas of Germany, OMV of Austria, SPP of Slovakia and several companies in Poland and Hungary. The EC is said to accuse the companies of dividing the market by a series of agreement and pushing prices too high.
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EESC says 25% emission reduction necessary by 2020
Press Release, 2011-09-26
According to the European Economic and Social Committee (EESC), the member states of the European Union (EU) would need to reduce emissions by 25% by 2020 in order to achieve the recently set target of a 80-95% reduction by 2050. Intermediary reduction targets of 60% by 2040 and 40% by 2030 should also be introduced. In addition, the EESC has recommended the review of the European Union Emissions Trading Scheme and has asked businesses to invest more in environmentally friendly technologies and energy efficiency. Estimated costs to reach the above mentioned objectives amount to some EUR 270bn (USD 364.88bn) annually for the coming 40 years.
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Finland

UPM increases its energy business
Helsingin Sanomat, 2011-09-29
Finnish forest industry company UPM plans to grow as a producer and seller of electricity, in Finland. According to Anja Silvennoinen, SVP, UPM, Energy Business Area, the company prepares for the completion of the Olkiluoto 3 nuclear power plant by boosting its organisation. UPM's energy business unit already employs 90 people. The company's personnel does not include power plant staff, however, as the production of electricity takes place in subsidiaries and associated companies.

Pohjolan Voima (PVO) produces nuclear and coal electricity, and hydropower is mainly governed by Kemijoki. There is also combined heat and power production at UPM's plants, and the company already produces more electricity than it uses, so it can also sell some electricity. Via PVO, UPM holds 30% of the capacity of Olkiluoto 3. The new reactor will double the amount of nuclear energy available to UPM to 1,039 megawatts. With the return on investment of 27% in 2010, energy is UPM's most profitable business area.
© Esmerk

Germany

Baden-Württemberg to promote wind power
Frankfurter Allgemeine Zeitung, 2011-09-28
The government of the German federal state of Baden-Württemberg has amended the planning legislation in a move to promote wind power generation. The wind power share in Baden-Württemberg is to be increased to 10% by 2020, from 0.8% at present. In order to achieve the objective, around 100 new wind turbines will have to be set up annually. The municipalities in Baden-Württemberg are to change their zoning plans by 30 August 2012 in order to allocate preference areas for wind power generation.
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End of nuclear power plants could cost EUR 18bn
Handelsblatt, 2011-09-28
According to Arthur D. Little (ADL), the closing and dismantling of 17 nuclear power blocks in Germany will cost more than EUR 18bn (USD 24.45bn). Of this total, EUR 4bn is needed even before the actual dismantling is started. In summer 2011 Germany's four nuclear power plant operators increased their nuclear energy reserves to more than EUR 30bn, but this total includes the costs of the final storage of radioactive waste. ADL warns that in the end the costs might be even 20% to 25% higher and that there could be logistics problems, as so many reactors are closed in a short period of time.
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Greece

Prime Minister is determined to allow mega solar power investment
balkans.com (Greece), 2011-09-27
Greece's Prime Minister, Giorgos Papandreou, is due to visit Berlin this week, where he will hold talks regarding a huge solar power project in Greece, which will be capable of filling the energy gap that will be left by Angela Merkel's decision to phase out nuclear production in the wake of the Fukushima disaster.

The solar project, names as Project Helios, will include the installation of photovoltaic panels on a 20,000 hectares area of depleted lignite mines near the northern Greek city of Kozani. The project is expected to attract some EUR 20bn (USD 27bn) worth of investment, it will create some 30,000-60,000 new jobs and will make the country a pioneer in solar energy production. The generated energy will be then exported to Northern Europe, with exports to Germany reaching 10,000-15,000MW's according to Papandreou.

Although Greece has failed in previous attempts to take advantage of such an abundant source of energy, Papandreou is committed to overcome the corruption and bureaucracy that surrounds the Greek system in order to allow such investment for the benefit of the country. Greece is privileged to enjoy about 300 days of sunlight each year, twice as much strong sunlight as Germany, yet the country produces 80 times less solar energy, according to Greece's Environment Minister, Giorgos Papakonstantinou.
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Italy

A2A has renewable energy asset proposal for EDF over Edison
La Repubblica, 2011-09-30
Italian utility A2A's Director General Renato Ravanelli said that the company seeks to acquire French peer EDF's renewable energy assets in exchange for its stake in the Italian utility Edison. This is part of the ongoing negotiations for Edison's shareholding reorganisation. EDF had initially offered to buy the Italian shareholders' stake in Edison for EUR 1 (USD 1.36) - EUR 1.1 per share in addition to a premium of around 30% on current market values.

With A2A's new plan, the Italian shareholders would instead receive renewable energy assets worth EUR 600mn - EUR 700mn from EDF. Recently, the Italian government had also been considering a proposal for EDF that involved renewable energy assets in a bid to retain the control of Edison in Italy.
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Lithuania

Hitachi concerned about financing for nuclear plant project
Baltic News Service, 2011-09-27
The Lithuanian government's negotiations with the Japanese-US energy company, Hitachi-GE Nuclear Energy (HGNE), on the construction of a new nuclear plant in Lithuania may take longer than expected, Verslo Zinios reports.

Sources in Japanese media claimed that an "energy war" between the EU and Russia on the construction of competing nuclear facilities in the Baltic region could hinder the project in Lithuania. Moreover, some officials in Lithuania said HGNE was unsure whether the Lithuanian government had funds to finance the project from the state budget or to provide state guarantees on loans. HGNE could then offer a more "sophisticated" model for financing the project, based on obligations to buy electricity generated at the nuclear plant.
© Esmerk

Netherlands

EPZ must perform more accurate stress tests
Het Financieele Dagblad, 2011-09-27
According to the Dutch Minister of Economic Affairs, Maxime Verhagen, the owner of Dutch nuclear power plant Borssele EPZ must make its stress tests more specific. EPZ is said to have not made it clear enough which combination of risks will be tested. EPZ is expected to publish the results of its stress test at the end of October 2011.
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Poland

PGE opens Belchatow II and asks for more EU funds for CCS
Rzeczpospolita, 2011-09-28
PGE has formally opened Belchatow II, its new EUR 1.20bn (USD 1.63bn) power block which has taken six years to build. The block's pilot CCS installation is one of only a few pilot projects in the EU to have obtained a subsidy from the Union. A grant of EUR 180mn for the installation has been agreed so far, but PGE is asking to have almost 100% of the costs of some EUR 600mn covered, saying the project should be viewed as research and development. PGE would also like the EU to offset the price of the energy produced, which will be higher due to CCS.
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Spain

E.ON doubles renewable energy capacity to 430 MW in three years
REVE, 2011-09-27
German energy group, E.ON, has managed to double its renewable energy capacity installed in Spain in three years, now having 430 MW in wind, thermal solar and biomass energy. Since 2008, the firm has spent almost EUR 1.20bn (USD 1.63bn) on renewable energy capacity in the country, out of a total investment of over EUR 4.5bn.

This effort is continuing and the company expects its renewable energy capacity to rise 33% in 2011 compared to a year earlier. It is expecting to have 455 MW of renewable capacity by the end of the year, following the start of operations at Helioenergy II, the second of the two plants which make up the thermal solar platform in Ecija.
© Esmerk

Switzerland

Council of States confirms the end of nuclear power
Le Temps, 2011-09-28
The Swiss Council of States, the upper house of the Swiss parliament, has confirmed plans to end nuclear power production in Switzerland. The five existing nuclear power stations will not be replaced by new sources of nuclear power once they are closed. No authorisation for new nuclear power stations will be given.

The last nuclear power station in Switzerland is expected to be Leibstadt, which should close in 2034. However, if the safety of the power station is assured its lifespan may be extended. Nuclear reactor technology will no longer be developed in Switzerland but Switzerland may contribute to support international research and training in the field.
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UK

Coal power stations may close four years earlier than expected
Telegraph (UK), 2011-09-30
The UK Government has admitted that under European Union (EU) rules, three of the country's coal power stations will probably have to close up to four years sooner than expected. It now anticipates that the Scottish Power-owned Cockenzie station will probably close completely by April 2012, whilst the E.ON-owned Kingsnorth station will probably close by March 2013 and RWE's Tilbury station may have to close by July 2013 unless the EU can be convinced that becoming a biomass station will make it cleaner.

Experts warn that the closures could result in power shortages. They suggest that more wind power will help to offset any loss. Recent figures show that in the first quarter of 2011 10% of the UK's energy was generated by wind.
© Esmerk

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