Ministry of Energy: The only way out for the Maritsa East complex is a transition from coal to gas
However, this option will only be valid until 2029, after which it will have to switch entirely to green technologies and hydrogen
TPP "Maritsa East 2" to continue to work, and the electricity produced by it not to lead to a rise in electricity prices for households from July 1 are the options on which the Ministry of Energy is working. This was announced by the Minister of Energy Andrey Zhivkov. According to him, talks are currently underway with both unions and employers. The final decision is expected soon, so that there will be no social turmoil at the plant, Zhivkov added.
As it is known, TPP Maritza East 2 does not have a quota for the regulated market, but there is a decision of the National Assembly, which prevents the plant from continuing to operate. For this reason, its participation is regulated only by an order of the Minister of Energy. In this sense, how exactly a solution will be reached remains to be seen, but the energy minister assured that there are options.
The future is also to be clarified in terms of financing the Beroe football club, which costs the company about BGN 6 million a year.
Gradual transition from coal to gas
Rehabilitation of the entire Maritza East complex is also part of the plans of the current team of the Ministry of Energy and will be included in the Recovery and Sustainability Plan. A specific agreement has been reached for gas capacities of 1.5 GW, which will be distributed through tenders, explained Minister Zhivkov. Tenders must ensure the balance of the system on a daily basis.
According to Deputy Minister Alexander Nikolov, solving the problem in the Maritsa East complex covers all three TPPs (Maritsa East 2, Contour Global Maritsa East 3 and AES TPP Maritsa East 1) and must go through a common approach to a smooth transition from coal to gas to ensure system resilience, balancing and a lower carbon footprint. However, for this to happen, it must first have approval at national level, and then from the European Commission.
"We will have to work within the established framework - 2029," said Nikolov. With such a decision, the assets of the complex will be preserved given the exclusion of gas from the EC after 2029. Subsequently, the Maritsa East plants will have to switch to full use of green energy and hydrogen production. For this to happen, however, the implementation of the option to switch to natural gas must begin as early as 2022.
The Deputy Minister described the decision on the transition "from coal to gas" as cost-effective. He also reminded that the power plants in the complex can benefit from funding not only from the Recovery Plan, but also from other programs. There is a possibility for grant and bridge financing in the order of 700 million euros. Accordingly, the companies operating the plants will have to participate in financing this transition to blue fuel with 40% own funds.
Due to the short term available to the caretaker ministry, the recommendations will be prepared for the next National Assembly.
The work on the changes in the Plan for Restoration and Sustainability within the interdepartmental group under Deputy Prime Minister Pekanov has been completed and if the document is approved, this will provide a horizon for the development of the Maritsa East complex. This fact, in turn, will have a positive impact on the entire BEH group, added Minister Zhivkov.
IGB
Work is under way to build a gas connection with Greece, but there are worries about implementation and the project company, he said. According to him, in particular it is a question of the supply of components for the gas pipeline. A letter will be sent to the company Avax (J&P AVAX SA) that in case of non-fulfillment of the contract for the supply of the necessary components, in particular leading to non-compliance with the deadline for completion of the gas-Bulgaria interconnection (end of this year) will be triggered the request for compensation under the contract of 90 thousand euros per day, explained the Minister.
Balkan stream
The current team of the Ministry of Energy confirms its preliminary conclusion that the Balkan Stream gas pipeline is causing losses to Bulgartransgaz, it became clear from the smoke of the Minister of Energy. The construction of the project is not financially viable, he said. Explained that in practice our country has waived compensation of BGN 1 billion and 350 million under the old contract for the Trans-Balkan gas pipeline, but has started the construction of a new one, where it could use these funds. The financial framework for Balkan Stream has been made, the future restriction of fossil fuels has not been taken into account, and this distorts the general picture, Minister Zhivkov added.
According to Deputy Minister Alexander Nikolov, if a comparison is made of Bulgartransgaz's revenues before the construction of Balkan Stream and now the question arises whether it will be possible to buy the pipeline and return the invested funds.