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France’s Veolia has agreed to buy a 430-megawatt gas-fired power plant in Hungary from German energy company Uniper, Reuters reported. Veolia released a statement saying that they expect the deal to close in the second half of 2024.
The gas-fired, combined-cycle power plant is located in Gönyű (northwestern Hungary) and is a key facility, primarily for electricity production. Financial details were not disclosed, writes Világgazdaság. The sale and purchase agreement was concluded through Veolia’s Hungarian subsidiary, and the transaction is subject to obtaining the necessary permits and complying with regulations.
The flexibly regulated plant plays an important role in maintaining the balance of Hungary’s electricity system.
According to the company’s CEO, Estelle Brachlianoff, the agreement fits well with Veolia’s ambitious plans to expand its flexible capacity.
The plant in Gönyű is Hungary’s youngest gas-fired power plant and the most efficient. According to a monthly market analysis by the Hungarian Energy and Public Utility Regulatory Authority, the plant operated at 59% capacity utilization last November (the latest available data), compared with 64% a year ago. The operation of power plants participating in system regulation is determined by regulatory needs, of course, and on the other hand, by the difference between the price of the branch they buy and the price of the electricity they produce, making it worthwhile for them to produce electricity for the market.
On their website, Veolia also highlights that the resilience capacity of the EU electricity system is expected to double by 2030, to keep pace with the growth of electricity from renewable energy sources. In this growing and strategic market, the company currently has 2.4 gigawatts of flexible capacity, equivalent to the consumption of 2.6 million inhabitants.
The still current owner of the power plant, Uniper Hungary, was established for an indefinite period of time for power generation and other activities not subject to licensing. The company took over the 433 megawatt gross combined cycle power plant in Gönyű in 2011, after the successful completion of the trial operation, and has been operating it since then.
The plant generated 2.5 terawatt hours of electricity in 2022, 7% more than the previous year.
However, the plant was unavailable in the first half of November 2022, due to a fault during major maintenance. In the second and third quarters of the year under review (especially in the third quarter), there was a significant increase in energy prices on European markets, with the price of natural gas in particular rising, but also the wholesale price of electricity. This caused short-term liquidity problems for the company that were resolved in September 2022, by increasing the parent company’s credit line.
However, the company did not see any negative change in the profitability of the power plant.
Via Reuters, Világgazdaság; Featured image via Pexels
