UK markets closed

Uniper to return Irsching gas plants to power market from October

The logo of German energy utility company Uniper SE is pictured in the company's headquarters in Duesseldorf

FRANKFURT (Reuters) - German utility Uniper <UN01.DE> will return its idled Irsching 4 and 5 gas-to-power plants in Bavaria to the wholesale market from October 1 as a slump in gas prices allows better commercial operations.[EL/DE]

Uniper, the sole owner of Irsching 4, and the local utilities of Nuremberg, Frankfurt and Darmstadt who jointly own the Irsching 5 plant with Uniper, said they had taken this decision after agreeing that conditions had improved.

But it also said: "The owners reserve the right to reassess the situation from year to year and to revise the decision in the event of a deterioration in market conditions."

Irsching 4 and 5, with capacities of 561 megawatts (MW) and 846 MW and operational since 2011 and 2010 respectively, have the highest possible efficiency rates - measured in fuel input versus electricity generation - in the European power market but have spent most of their lifetimes in standby mode.

"As things stand, it may be possible to obtain slightly improved margins in the foreseeable future through the operation of these plants for the market," said Uniper board member David Bryson.

"As the level of power generated from the wind and sun can fluctuate heavily, highly efficient and modern gas power plants such as Irsching 4 and 5 can provide a reliable foundation for energy supply," he added.

The owners had applied to keep the plants closed for a year after October but the energy regulator had declared them to be of systemic importance on standby if transmission networks need additional support to counterbalance volatile wind and solar power.

This entitled the operators to a standby fee.

But profit margins on burning gas to power inclusive of expensive carbon emissions allowances in 2021 are now positive <TRDECSBYZ1> while generating coal to power is negative. <TRDECDBYZ1>


(Reporting by Vera Eckert; Editing by Michelle Martin)