July 15, 2020 Read More →

EDP to close two coal plants, convert a third to gas, in Portugal, Spain in 2021

S&P Global Market Intelligence ($):

EDP – Energias de Portugal SA is planning to shut down two of its coal-fired power plants in Spain and Portugal by 2021 and convert a third unit to burn gas, following in the footsteps of other utilities as it withdraws from a fuel source that is continuing to lose attractiveness.

EDP said July 14 that it has asked for permission to stop producing electricity at its 1,180-MW Sines power plant in Portugal in January 2021 and shut down the 346-MW Soto De Ribera 3 unit in Spain sometime during same year. At a third power plant, Aboño in Spain, EDP wants to convert one 342-MW coal unit to gas by 2022, with another 562-MW unit used as backup capacity.

The shutdowns will lead to an extraordinary cost of about €100 million before taxes in its 2020 financial results, the company said.

The announcement comes after EDP said in December 2019 that it would write down its remaining coal plants on the Iberian Peninsula to the tune of about €300 million, citing their loss of competitiveness against other forms of generation. Miguel Stilwell de Andrade, EDP’s CFO at the time and now its interim CEO, said then that the company would only keep the coal plants “as long as they’re profitable.”

EDP confirmed July 14 that market conditions for its coal plants continued to deteriorate during the first half of 2020. As a result, Sines has not produced any power since January, while Soto de Ribera 3 has been idle for the past 12 months.

The capacity the utility now plans to shut down and convert represents more than half of the 2,430 MW of coal it still owned in Iberia as of June. While that figure has been unchanged for the past year, electricity generation from those coal plants was down 76% in the first six months of this year, dropping from about 5 TWh to 1.2 TWh, against a steep recovery in hydropower production.

[Yannic Rack]

More ($): EDP moves to close unprofitable coal plants in Spain, Portugal

Comments are closed.