CEZ Selling Four Coal-Fired Plants

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland) -- The sale of four coal-fired power plants in the Czech Republic looks increasingly likely as CEZ Group (PRG:BAACEZ) (Prague, Czech Republic) confirmed the receipt new bids.

The state-owned company has been tasked by the European Commission (E.C.) to sell up to 800-megawatts (MW) of its coal-fired generation portfolio in order to increase competition in the market place. This week, CEZ confirmed that it has received three "eligible bids" for its Detmarovice coal-fired plant, an 800-MW power plant located near the Czech town of Ostrava, near the Polish border.

Coal-fired power plants account for almost 70% of the country's power and CEZ owns and operates 10 coal-fired power stations. In addition to opening up the market to more competition, CEZ has committed to reducing its greenhouse-gas emissions by 15% by 2020 while simultaneously tripling its energy production from renewable energy resources from 1.7 terawatt hours (TWh) in 2005 to 5.1 TWh by the end of the decade.

The company said: "In the first round, CEZ received offers [for Detmarovice ] from four entities. After examining the formal details required of each of the offers, CEZ however had to exclude Èeská energie from the tender. Their offer failed to meet the tender requirements, which among other things defined the required size and creditworthiness of the participants. Thus, their offer did not guarantee a successful completion of the potential sale, which is required to consummate the Settlement Agreement with the European Commission. The remaining participants that have been invited for the next round of the selection procedure include investment company BXR (Amsterdam, The Netherlands), Energetický a prùmyslový and Gascontrol (Havírov-Sucha, Czech Republic)".

In June this year, CEZ claimed that uncertainty over the future price of coal forced its decision to sell its 1,000 MW Pocerady plant, located northwest of Prague, and its 800 MW Chvaletice power station in the Elbe basin, approximately 20 kilometres (km) west of the city of Pardubice. The plants represent around 12% of the company's generation capacity. For additional information, see June 11, 2012, article - CEZ to Sell Two Coal-Fired Plants.

The company is also interested in selling the Tisova plant together with Melnik 3.

"A decision on the sale of one or potentially more power plants should be made by the end of this year," the company stated.

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