Russia adopts power sector restructuring scheme

The Russian cabinet has approved a plan to restructure the country’s electricity system that will see the state-controlled Unified Energy Systems (UES) split up and a doubling of electricity prices for consumers.

The plans will be finalized over the next three months but have already met with opposition from UES shareholders and the Kremlin-appointed Kress Commission.

The proposed reforms call for the unbundling of generation and supply and will hand over control of transmission lines to the state. The plan was developed by the minister for economic development, German Gref, and is in line with proposals made by UES in 2000.

Gref’s proposals must meet the wishes of the Kress Comm-ission, which was appointed last year by President Vladimir Putin. Kress has called for keeping the vertically integrated structure of the industry in place.

Gref believes that the plan will help to attract much-needed foreign investment to Russia’s power sector. “We are incapable of investing in the grid infrastructure now, and the growth in tariffs is needed to attract investments,” said Gref.

Anatoly Chubais, the head of UES, welcomed the proposals but expressed concern over the slow pace of the proposed timetable.

Czechs consider Temelin plant closure

The Czech government has indicated for the first time that it will consider closing the controversial Temelin nuclear power plant following strong political pressure and opposition from neighbouring countries.

Czech foreign minister Jan Kavan stated in May that a feasibility study was to be prepared on closing the plant, which has experienced a series of technical faults since commissioning began. Full commissioning has been delayed until June 2001 pending an environmental impact study, although recent technical problems are likely to push this back until the autumn.

Temelin’s No 1 block was put out of action once again in April following a turbine fault.

Operating company CEZ stated in May that it will seek compensation for the string of technical failures from Skoda Engineering if commissioning of the plant is delayed again.

Austrian opponents and anti-nuclear campaigners have boycotted a public hearing into the environmental impact study, claiming that the study is flawed.

French-Korean alliance wins Fujairah project bid

The UAE Offsets Group (UOG) has announced that an alliance of Sidem of France and Hyundai Engineering and Construction Co. of South Korea has won the bidding for the $1bn Fujairah desalination, power and pipeline project in Qidfa, UAE.

Sidem and Hyundai submitted the lowest bid among the nine proposals received and opened on April 28, 2001. Other bidders included South Korea’s Hanjung, Italy’s Fisia Italimpianti and the UK’s Weir Westgarth.

The contract involves the engineering, procurement and construction of a 455m l/day desalination plant and an associated power plant with an output of over 100 MW. The plant will help meet the rising demand for power and water in the northern Emirates.

Technical and commercial bids for a $400m transmission package were due to be opened on May 30, 2001. Both packages are expected to be awarded by August this year, and the plant will be complete within 24 months.

Micro-hydro plan

Ghana’s Energy Foundation (EF) has asked the government to consider building a number of micro-hydro projects instead of investing in a 400 MW dam at Bui. The EF believes Micro-hydro projects could meet the demand for power without harming the environment.

EF director of communication and marketing Ernest Asare stated that if the Bui dam were built, the Bole Game Reserve would be flooded and the government would have to pay out on compensation and resettlement schemes. The government wants to build the 400 MW project in western Ghana to help meet rising demand for power.

Asare said that although hydropower is a cheap source of power, “it is getting difficult to get funding for new dam construction because a whole slew of organizations are opposing such projects.”

AES strikes twice

AES of the USA has purchased a 75 per cent controlling interest in Rivenoblenergo, a distribution company serving Ukraine’s Rivno region, for $23.2m. It is the second Ukrainian power distribution company that AES has purchased.

Rivenoblenergo is one of six distribution companies currently being privatized by the government. AES already has a controlling interest in Kievoblenergo, the largest distribution company in the Ukraine.

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