Veolia buys 430 MW gas power plant in Hungary from Uniper

By buying the Gönyű gas-fired power plant in Hungary, Veolia is strengthening its flexible energy portfolio. The seller, Uniper, is making a step toward its ambitious climate neutrality goal and fulfilling the obligations for a state aid package approved at the height of the energy crisis.

Veolia said it has signed an agreement with Uniper, via its Hungarian subsidiary Veolia Invest Hungary, for the acquisition of a 430 MW power plant. Located in Gönyű, in northwest Hungary, the gas-fired combined cycle facility is the most modern and efficient in the country, according to the announcement. It was commissioned in 2011.

The gas power plant plays a crucial role in regulating and balancing the Hungarian power grid, thanks to cutting-edge technologies that make its production capacities flexible, the French company pointed out. On that note, Veolia also said the takeover would complete its flexible energy portfolio to meet the needs of resilient power systems.

Demand for ancillary services continues to grow, as current flexibility volumes in the European Union’s power system need to be doubled by 2030 to keep pace with the growth of fluctuating renewable electricity supply, the update adds.

Veolia set to obtain regulatory clearance by end-June

Veolia said it now has 2.4 GW in flexible electricity production. The deal is subject to regulatory approvals, which the companies expect to obtain by mid-year. They agreed not to publish the financial details.

“In the context of European energy mix evolution towards more renewables and therefore more intermittent production, demand for ancillary services, and in particular electrical flexibility, continues to grow, with a rising need for power grid balancing. It requires both enhanced electricity interconnection and operators with cutting-edge digital expertise to aggregate the production capacity of several power generation units and provide the grid with flexible energy volumes that can be introduced or withdrawn from the grid as required,” Veolia said.

Uniper targeting carbon neutrality by 2040

The transaction concerns 100% of the shares in Uniper Hungary Energetikai. The Düsseldorf-based company said the divestment is part of the remedies it must fulfill under EU state aid law. The measures are related to the stabilization package that the European Commission approved for Uniper in late 2022, at the height of the energy crisis.

Active in more than 40 countries and with its core businesses in Germany, the United Kingdom, Sweden and the Netherlands, the company also owns hydropower plants and is expanding in the wind and solar power sectors. Uniper is a global energy trader, too, and operates gas storage.

The company has vowed to become carbon neutral by 2040 and to have an 80% share of zero-carbon power generating capacity by 2030. For decarbonization it relies on introducing green gases like hydrogen and biomethane and convert to them over the long term.

Uniper hired Wolf Theiss to advise it on all Hungarian legal, tax and regulatory aspects of the transaction.