CEZ divests coal plant but retains free CO2 permits
Czech energy major CEZ has cut future emissions by selling one of its dirty coal-fired power plants, but is holding onto the free allocation of allowances for the installation, according to a press release on its website.
The 800MW Chvaletice plant was allocated 2.7m allowances annually between 2009 and 2012, while its emissions varied and, for instance, came to 3.4m tonnes of CO2 equivalent (tCO2e) last year, according to verified EU emissions data for 2012.
The divestment could reduce its 2013 CO2 footprint, which analysts say fell by as much as 12% to 15.9m tonnes in the first half of this year ( see EDCM 13 August 2013 ), as well as adding to any surplus allowances the utility may have.
Coal mining group Severni energeticka bought the Chvaletice plant on 2 September.
Despite no longer having to account for the plant’s emissions, the utility will still reap its free allowance.
“CEZ will annually obtain 90% of the market value of CO2 emission allowances allocated for free to the Chvaletice power plant, which will then be used to further upgrade its power plants,” the utility commented in a statement.
Shrinking CO2 footprint
A CEZ spokeswoman said one reason to select the Chvaletice plant for divestment under the EU programme was that it emits a lot of CO2 and would be too expensive to modernise.
The company has a long-standing and publicly available “action plan” on CO2 reduction, mainly through the upgrading of some of its ageing coal-fired plants to “clean coal” technology, along with the substitution of renewable and nuclear sources for some coal-generation capacity, she added.
Under new ownership, the 800MW coal-fired Chvaletice plant will stay on line beyond 2016, which was when former owner CEZ had planned to shut it down, Severni energeticka confirmed to ICIS.
Last year CEZ considered selling Chvaletice and Pocerady, another 1970s power station, partly to avoid paying for compulsory modernisation works required under the EU’s Large Combustion Plants Directive before the end of 2015 ( see EDCM 29 June 2013 ).
CEZ Group’s greenhouse-gas emission-reduction plan aims for a 15% decrease on 2005 levels by 2020, with the emissions reduction factor falling from 0.55 tCO2e/MWh to 0.47 tCO2e/MWh.
More CO2 from plant
Erste Group Bank energy analyst Petr Bartek said that Severni energeticka could increase output at the plant by around 1TWh/year, which would push up emissions, as it has access to its own coal supply, making it cheaper for the company to run the plant, compared with CEZ.
The average output from the Chvaletice plant under CEZ’s management was 2.5-3.5TWh/year, according to a company spokeswoman.
Bartek thought CEZ would invest in other power plants, which could again change its emissions profile. Karolina Zagrodna/Marie-Louise du Bois
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