VERBUND Supervisory Board Confirms Management's Decision to Close Down and Decommission Thermal Power Plants
The decision by VERBUND to close the coal-fired power plant in Dürnrohr and the oil-fired power plant in Neudorf/Werndorf II as well as the temporary closure of the gas combination cycle power plant in Mellach and in Pont-sur-Sambre and Toul in France was made public on 14 May 2014 and confirmed today by the VERBUND supervisory board. VERBUND provides information regarding the next steps.
The massive slump in the European electricity market has lead to industry-wide financial pressure, under which all electricity-producing companies are suffering, especially in the area of thermal energy. VERBUND already reacted to this negative development on the market in 2013 and implemented the first operative countermeasures. In addition, VERBUND today has decided in favour of the closure and temporary closure of the thermal power plants, and this should lead to a steady financial improvement in the coming years. The goal now is to find employment, mainly in other VERBUND affiliate companies, for the roughly 100 employees working in the Austrian power plants concerned.
Socially acceptable solutions for employees
The foremost priority is the reemployment of the affected employees at other affiliate companies, in order to keep these highly qualified employees within the company. The social plan, which was approved by the cost management programme, in place since 2013, also applies to employees of the thermal power plants undergoing closure in Austria.
Temporary course of action for closure and temporary closure.
After evaluating all the options presenting financial advantages in relation to closure, the preparations for closure of the coal-fired power plant in Durnröhr and the oil-fired power plant in Neudorf/Werndorf II are underway. In Dürnrohr especially, the requirement for the network operator will be used as a cold reserve for Germany in the winter months. A result is expected at the latest in autumn.
In both French gas combination cycle power plants in Pont-sur-Sambre and Toul there are roughly 35 VERBUND employees in total. Subject to all official, legal and technical obligations and deadlines, the year-round, temporary closure immediately came into effect.
Due to the current market situation, the gas combination cycle power plant in Mellach is currently not financially viable for operation and will be temporarily closed all year in compliance with the official, legal and technical obligations and deadlines.
Providing district heating supply for the city of Graz
With Energie Steiermark's withdrawal from VERBUND Thermal Power in December 2013, the existing district heating delivery contract was changed and the yearly terminability was agreed to first take effect on 30 June 2020. The agreed upon heat supply is a maximum of 230 MW and the other conditions remain unchanged: There is no obligation to make provisions in case of a deficit. VERBUND Thermal Power is, however, obliged to take over the costs of increased production should there not be a delivery or if too little is delivered in the district heating power plant in Graz. VERBUND confirms that it will fulfil its heat delivery contract via VERBUND Thermal Power.
District heating is a decision made over generations. VERBUND is prepared to hold discussions with the population in and southerly from Graz, regarding a short and long-term district heating supply which is also low in emissions.