World News: international

Russia delays reform plans

Russian lawmakers have opted to delay the second reading of the country’s electricity reform bill. Four state Duma factions making up a parliamentary majority voted in December to delay the reading until 2003.

The delay was supported by the People’s Deputy faction, the Regions of Russia, Unity and Fatherland-All Russia parties. All four factions traditionally support Kremlin-inspired legislation, but are thought to be reluctant to pass unpopular legislation before the December 2003 parliamentary elections.

News on the delay caused a drop in the share price of United Energy Systems, the country’s power monopoly. The power reform laws have already cleared their first hurdle, a first reading in the Duma in which lawmakers gave basic approval to draft laws which will clear the government to break up UES.

The second reading, which is yet to be rescheduled, will discuss the regulatory structure of the electric power market. Postponement might delay the reform process, scheduled to be completed in July 2005. This, says analysts, will have a negative impact on the power sector.

Hungary to sell x-border rights

Hungary’s state-owned electricity system operator (Mavir) announced a tender to sell the utilization rights of Hungary’s excess cross-border electricity transmission capacities for this year. The tender marks the first step in partial liberalization. It is being seen as a trial for a future permanent auction system.

The grid operator is expecting a lot of interest from bidders in the tender, which are expected to include the local affiliates of German companies RWE and E.ON, and France’s Electricit√© de France, which are the three largest power groups in the country.

The rights to use cross-border capacities will allow for the export, import and transit of electricity from and into three of Hungary’s seven neighbours ” Austria, Slovakia and Croatia.

AES continues asset sales programme

AES is driving its global divestment programme by agreeing to sell assets in Africa, after giving the nod on a similar deal in Australia. The agreement in Africa is with CDC Globeleq, CDC Group’s emerging markets power business, to sell its ownership interest in two generation businesses in Africa for $329m.

The deal, with assumed project debt, consists the assets of Songas Limited, a gas-to-electric business currently under construction in Tanzania, which is to be completed by CDC Globeleq and AES’ 95 per cent interest in AES Kelvin Power ” a 600 MW coal-fired facility that is currently under refurbishment in South Africa. The remaining five per cent is held by Global African Power, a black empowerment partner.

CEZ merges with discos

The Czech Republic’s anti-monopoly office UOHS has approved a merger between power company CEZ and five regional power distributors. The five distributors are Stredoceska energeticka, Vychodoceska energetika, Severoceska energetika, Zapadoceska energetika and Severmoravska energetika.

The move comes after the power giant’s failed privatization attempt last summer. The country’s three remaining distributors will be sold to foreign investors.

A number of distributors have opposed the deal, stating that it will jeopardize the liberalization process and cause power prices to rise. CEZ has refuted this claim, saying that the merger will help to drive down electricity prices.

Alstom bags refurbishment project in Mozambique

Alstom has signed a g40m contract with Hidroelectrica de Cahora Bassa to refurbish the Cahora Bassa hydropower station (5 x 415 MW) situated on the Zambezi river near Songo in the Tete province of Mozambique.

The aging Cahora Bassa plant is often prevented from operating with optimal performance by problems related to maintenance and supply of spare parts. Alstom plans to refurbish and modernize as much of the equipment in order to bring the plant up to date, thus enabling the plant to run at full capacity without impacting the environment. Completion of the project is scheduled for June 2004.

South Africa makes PBMR project breakthrough

South Africa’s Pebble Bed Modular Reactor (PBMR) made progress in starting up a test rig of the PBMR power conversion system. The test rig represents the first closed-cycle, multi-shaft gas turbine in the world.

David Nicholls, CEO of PBMR Ltd, says the main objectives of the project were to prove that a three shaft recuperated Brayton cycle can be sustained and controlled, that it renders a stable operating configuration and to provide code verification. South African utility Eskom has been keeping close tabs on the equipment as a potential source for future projects.

News digest

Azerbaijan: Azerbaijan and Iran have agreed to proceed with the construction of a power cable that will cross their common border at Astara, near the Caspian sea coast. Work on the 220 kV transmission line began last month and is due to go in operation March 2003.

Iran: Iran’s first geothermal power plant will be built in the northeastern Sabalan region of Ardebil province. Six wells are being drilled on the site of the plant at depths of 3500 m. The steam obtained from the wells will be used to drive steam turbines.

Romania: Alstom, a leader of consortium with Japanese firm Itochu, has won a g21.9m contract with Romanian transmission system operator Transelectrica to create a national fibre optic telecommunication network for its electrical power transmission grid.

Romania: Romania’s Finance Minister Mihal Tanasescu said that some of the state’s power assets will not be put up for privatization for the moment. Those off the list are thermal power plants, but Hidroelectrica, the state’s main hydropower producer, will be sold, as well as two of the state’s electricity distributors.

Russia: Gazprom unveiled plans to build a North European gas pipeline linking Russia and Germany, its largest western European customer. Total construction costs are estimated at $5.7bn and Gazprom plans to launch the pipeline in 2009.

South Africa: Eskom Enterprises outbid Spanish and Indian power firms to clinch a 20-year concession to boost Uganda’s power supply. The company will operate two power dams situated on the River Nile which have a maximum capacity of 380 MW but currently provide 300 MW and supply almost all of Uganda’s power.

UAE: The Gulf states must invest over $130bn over the next 20 years to meet expanding residential and industrial demand for power. The UAE alone will need 8000 MW of additional capacity within ten years, double the installed capacity in 1999, according to the Institute for International Research.

UAE: ABB announced it has signed a $15m contract with Abu Dhabi Water Electricity Authority to modernize the process control system for the Al Taweelah B power station. The project will help the plant lower operating costs and remain competitive as Abu Dhabi expands its present national system under inclusion of privately owned electricity and water suppliers.

Uganda: Uganda Electricity Generation Company has awarded Alstom a supplementary order for the installation of the fifth 40 MW unit at the Kiira power station.

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