The future of thermal power plants in Serbia is being decided by the price of electricity

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It is quite certain that the third block of “Kostolac B” will be among the last coal-fired power plants that China will build in Europe. What is also certain, however, is that there will be no planned shutdown of some thermal power plants yet. This is a consequence of more than twice the price of electricity, which will be high in 2022 as well.
With such a disruption in the European energy market, everyone will manage how they can replace the necessary electricity. Some other solutions will come only when the situation stabilizes, according to the energy advisor to the President of the Serbian Chamber of Commerce (SCC), Miroslav Lutovac.
The fate of coal-fired power plants
Chinese President Xi Jinping just pointed out before the UN General Assembly that China will no longer build new coal-fired thermal power plants abroad and that it will strengthen its support for developing countries to rely on the development of green energy. Beijing has long been under great diplomatic pressure to end the financing of numerous coal mines in the world.
The transition to green energy, however, is still in the long run. Neither cheap nor fast. That is why it is quite certain that thermal power plants will still live, no matter how much China around the world does not build them. In May last year, Germany put into operation a new thermal power plant “Dateln 4”, and the RWE plans to exploit at least another 900 million tons of lignite by 2038.
In a situation when gas prices in Europe have more than tripled because stocks are not provided on time and when Asian demand is high, the Spanish government, in which wholesale electricity prices have also more than tripled, last week limited their growth and profits of electricity companies.
In a letter to the European Commission, Madrid asked it to establish guidelines in order to help EU countries react to the jump in electricity prices.
The price of electricity glowed the phones
Lutovac notes that the phones in PKS have been glowing lately because businessmen were shocked by the prices on offer when they started negotiating on electricity supplies for next year. But that is so, because, as he points out, we have made stock exchange goods from energy, at least as far as industry is concerned, and it follows market trends, so the price in our country is the same as in Europe.
The energy expert notes that the price of electricity is generally related to the movement of the price of gas and oil. With the awakening of the economy, which was stopped by the corona last year, the demand for these energy sources also raised their prices.
Thus, the prices of electricity went over 150 euros per megawatt hour, and previously they were between 50 and 60 euros. The jump is dramatic – more than twice.
When asked if this is only about the current situation, Lutovac said that, considering the futures that are already contracting for the future delivery of electricity, it is quite clear that a return to the old state is not possible.
“Currently, electricity deliveries are being contracted for next year, and they are at a price of 110 to 120 euros per megawatt hour. It is slightly lower than the current prices, but in any case it is at a very high level. And everyone predicts that it will not be below that level next year. That is twice as much as we had at the end of July or until the middle of August, when it became dramatic,” points out Sputnik’s interlocutor.
He notes that another important thing is that this year is generally bad for Europe in terms of electricity production. According to some data, which, he says, he had the opportunity to see, the production of electricity from wind is a quarter less than forecast. It’s just that the climate is like that, there was less wind, he explains.
He points out that we in Serbia have largely relied on hydroelectric power plants, which is also green energy, but that this year is not great for that either in our country or in Europe. There will be problems with global climate change and with hydrology, where the biggest problem is extreme values. Either you have heavy rainfall and floods, or, as he says, you don’t have them at all.
Shutting down nuclear weapons in question
Lutovac notes that a lot of nuclear power plants should be shut down, but that even now it is slowed down. According to the long-term plan, the Germans should put a number of nuclear power plants out of operation next year, but, he adds, the question is what will happen.
“You have another factor that is talked about a lot, and that is the carbon dioxide tax, which has jumped a lot. At this price of 150 euros per megawatt, the share of the tax paid by all electricity producers in Europe is 40 percent of that price. It reached 60 euros per cubic meter, and when it is converted into energy, it is a little less than 40 percent of the total price of electricity,” said the energy advisor to the president of the Serbian Chamber of Commerce.
The funds from that tax are used to finance the elimination of fossil fuels, ie the production of electricity from coal-fired power plants.
An additional problem in the supply of electricity in Europe was caused by the failure of the one-way cable that supplies the British island with electricity from the European mainland. Since they had nowhere to draw additional energy, the British reactivated some old thermal power plants, which they almost destroyed, because, as he says, they had no choice.
What about the situation when green energy does not yet provide the quantities needed to satisfy consumption, when it is planned to shut down thermal power plants and nuclear power plants, where to supply the necessary electricity?
When necessary, the law changes
Lutovac answers that question by stating that, as for everything, there are fast, urgent solutions, as well as those in the medium and long term.
He sees a solution in the long run in green hydrogen, which is now expensive, but in the long run could be a substitute for fossil fuels if technologies improve a little and the cost of producing hydrogen for energy falls.
“As for short-term solutions, there is a need to change the law. The biggest advocates of eliminating thermal power plants return them when they have no alternatives, so I think that in this disturbance on the energy market, everyone will manage as they know and can with what they have at their disposal. And when the situation stabilizes a little, then they will probably start thinking about some other solutions,” Lutovac points out.
And what will happen in 30 years, considering the climate changes we have, is increasingly difficult to predict, even how realistic it is for the European Union to fulfill the plan to shut down all coal-fired power plants by 2050 at the latest.