Czech power company CEZ AS (BAACEZ.PR) said Tuesday it plans to delay a decision on the construction of two new reactors at its main nuclear power plant until next year or 2015 as it evaluates the project feasibility and expected demand for electricity in its home market.
Czech power company CEZ AS (BAACEZ.PR) said Tuesday it plans to delay a
decision on the construction of two new reactors at its main nuclear power
plant until next year or 2015 as it evaluates the project feasibility and
expected demand for electricity in its home market.
"Our final decision is contingent on the government's energy strategy and
certainty of an economic viability of the project," Chief Executive Daniel
Benes told a news conference, confirming the company's earlier indications that
it may take longer than planned to decide on the $10 billion project.
CEZ had planned to select a builder this year for the design and construction
of the new reactors.
The 70%-state-owned power utility, which ranks as the Europe's second-largest
electricity exporter in volume terms after its French peer Electricite de
France SA (EDF.FR), is evaluating offers from Westinghouse Corp., a unit of
Japan's Toshiba Corp. (6502.TO) and Russian state-owned nuclear energy holding
Rosatom to double output at its Temelin nuclear plant to 4,000 megawatts by
2025.
CEZ aims to cut back generation at its traditional coal-fired plants and
replace it with additional nuclear generation, while maintaining its ability to
export power at current levels.
Mr. Benes said it wasn't certain if a projected increase in electricity demand
in the
Czech Republic
was
realistic, and could be lower than expected.
Ongoing political uncertainty in the country following the government's
resignation and prospects for an early general election are complicating CEZ's
discussions with government officials about Temelin.
"The political situation is currently in flux," Mr. Benes said.
Owing to the uncertainty, CEZ decided against raising its full-year profit
guidance for 2013, currently set at 37.5 billion koruna ($1.93 billion),
despite expecting to receive a CZK2 billion boost from the sale of its
coal-fired power plant at Chvaletice in the
Czech
Republic
.
"We want to have a safety cushion," said CEZ's Chief Financial
Officer Martin Novak.
The asset sale could boost the full-year net profit to about CZK39.40 billion
this year, just below CZK40.2 billion in 2012, said Josef Nemy, an analyst at
the Prague-based unit of Societe Generale.
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