Photo: ContourGlobal
After an abrupt halt a year ago, ContourGlobal’s coal power plant in Bulgaria is returning two out of four units to the grid, to operate at least until the end of March. The government, which has a minority stake, is reportedly planning to acquire them.
The liberalization of the power market in Bulgaria has crippled the viability of coal-fired thermal power plants. When its 15-year contract with state-owned National Electricity Co. (NEK) expired last February, ContourGlobal Maritsa East 3 (Maritsa iztok 3) couldn’t break even by far. The facility immediately halted its operations.
ContourGlobal, owned by KKR, has a 73% stake in Maritsa East 3. NEK, part of Bulgarian Energy Holding (BEH), holds the rest. Notably, the facility only worked for a short while in July, when power prices surged and surpassed production costs.
The firm laid off almost all its employees, but now it hired 150 people to run units 3 and 4 at least until the end of March.
Government wants to increase its stake in ContourGlobal Maritsa East 3
The turnaround occurred when Minister of Energy Vladimir Malinov recently said they would be restarted to reduce the need for imports in the winter months.
In the meantime, news emerged that the government would negotiate with the company to increase its stake, Economic.bg wrote. The goal is probably for units 3 and 4 to become fully state-owned, but it is not clear how they will continue to function, the report adds.
Keeping a coal plant in reserve just to work for a few months in the winter and summer is extremely expensive
They will operate at a maximum of 400 MW in total. Unit 4 came back online first, on January 7, with 160 MW. Active coal power capacity in Bulgaria, 2.2 GW, accounts for 37.6% of production, Electricity System Operator (ESO) said.
Keeping a coal plant in reserve just to work for a few months in the winter and summer can be arranged, but it is extremely expensive. In addition, workers may be reluctant to stay if they don’t consider their jobs secure.
For a successful energy transition, measures must be just and thoroughly planned and with a controlled coal phaseout, to avoid energy shortages.
State-owned coal plant has won only contract with ministry
The Energy and Water Regulatory Commission (EWRC or, in Bulgarian, KEVR) said last year that the United States–based company asked a year ago to be included in the government’s quota for the purchase of electricity from local primary sources. The ministry rejected the request and only awarded one such contract to state-owned Maritsa East 2. Seven of its eight units were recently delivering electricity, or almost 1.3 GW out of just over 1.6 GW.
The media outlet also learned that green energy projects under ContourGlobal Maritsa East 3 may be submitted for grants via the European Union’s Modernisation Fund. The plan includes a photovoltaic plant of 83 MW with a battery energy storage system (BESS) with 25 MW in capability. ContourGlobal is in KKR’s ownership
A study is also underway for another 120 MW of solar power at the site. The hybrid power plant project has a special advantage: the coal plant’s high-voltage connection.
Electricity prices in Bulgaria rose by an average of 8.4% in January. The authorities cited a bigger-than-expected rise in consumption and a rise in prices in markets in the surrounding region.
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