US company AES, which operates the Maritza Iztok 1 coal-fired
plant in Bulgaria, cannot sell electricity on the open market in the country
because the selling price is too low to cover its investments, AES Bulgaria's
managing director said on Friday.
The company's investments in the plant
exceed 1.3 billion euro ($1.4 billion), Olivier Marquette said in an interview
posted on the website of state-operated radio broadcaster BNR.
The
15-year power purchase agreement (PPA) AES signed in 2001 with Bulgarian
electricity company NEK ensures a cash flow with which the company can repay its
creditors, according to Marquette.
He also said that the project's return
on investment is a lot less than 17%, as has been quoted in the
media.
AES and ContourGlobal, another US-based company that owns Maritza
Iztok 3 thermal power plant (TPP), signed last month a memorandum of
understanding withstate-run electricity company NEK, under which the two US
companies agreed to a lower price at which NEK buys electricity produced by
their TPPs. For its part, NEK has pledged to pay back its liabilities to the two
plant operators.
The deal with AES and ContourGlobal is part of the
government's efforts to cut the deficit in the Bulgarian energy system. The
country's energy minister has said the total deficit of NEK exceeds 3 billion
levs.
According to AES's managing director, the company is not
responsible for the deficit.
“It's clear that we are not the problem and
we are a very small part of the total amount that NEK is paying, so we are just
a small part of the picture here. We are about 8% of the electricity
generation,” Marquette said.
The parliament approved, at the end of
February, amendments to the energy legislation, which are expected to reduce
NEK's deficit by some 100 million levs by the end of the year. The measures
envisage that those TPPs whose operations are inefficient will be excluded from
the country's energy mix, and curb power production from biomass, among
others.
Last month, Bulgaria's energy minister said AES and ContourGlobal
owe state-owned mining complex Mini Maritsa Iztok a combined 140 - 170 million
levs in overdue payments because they are still owed a total of 600 million levs
in overdue payments from NEK.
The two TPPs, owned by ContourGlobal and
AES, are part of the country's largest energy complex Maritsa Iztok, located in
the southeastern region of Stara Zagora. The complex hosts lignite coal mines
and three coal-fired power plants. ContourGlobal acquired a majority stake in
the Maritsa Iztok 3 TPP from Italy's Enel in June 2011. AES launched the Maritza
Iztok 1 power plant in 2011.
NEK and Mini Maritsa Iztok are
100%-subsidiaries of state-operated Bulgarian Energy Holding