The Polish subsidiary of the Czech-based energy holding EPH has reportedly submitted a bid to take over EDF’s coal-fired power plant Rybnik, local media reported on May 23.
The apparent bid, reported by Puls Biznesu, citing unnamed sources, would fit EPH’s strategy of buying coal-fired power assets from companies looking to divest older fossil fuel plants to concentrate on more environmentally-friendly capacity. The Slovak-owned company is betting that the plants will either see a longer life than envisaged under EU regulations, or that Brussels will expand the capacity market, under which conventional power plants are paid subsidies to remain as reserve capacity, as output from renewables may be erratic.
At the same time, EPH - which has over the past 18 months bought large coal-powered assets in the UK, Italy, Slovakia and Germany - has more immediate motivation to buy coal-fired capacity in Poland. The group owns coal producer PG Silesia, which in an already weak market is struggling as the state merges its massive coal holdings with the country's major utilities.
PG Silesia produces about 1.2mn tonnes of coal annually, while the Rybnik power plant consumes around 2mn tonnes, according to the newspaper. EPH could also sell the coal in the Czech Republic, where major miner OKD, owned by New World Resource holding, has recently filed for bankruptcy.
According to Puls Biznesu, demand from OKD’s customers could come in at around 4mn tonnes each year. EPH also owns a large stake in Slovakia's dominant power producer Slovenske Elektrarne, and is in the process of buying several coal-fired plants in Germany from Vattenfall.
Several suitors, including Czech state-controlled giant CEZ and Polish peer Energa, have said they would be interested in EDF's portfolio of heat and power assets in Poland. However, most insist they would not be keen on buying Rybnik.
The Polish newspaper claims that the French seller has received at least two bids for Rybnik. It adds that one involves a "negative price" that would see EDF exit at a loss after making some allowance for necessary investment in the ageing plant. EPH last month sealed such a deal with Vattenfall.
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