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Mr Kupčinskas announced that the investment project of Kaunas Power Plant, worth one billion litas, is far from being worth any interest to him during the hard times; this is the matter of private investors.

The Mayor of Kaunas City refused to express his opinion to one German insurance company about the project worth one billion litas. Positive opinion of the city government would establish conditions to reduce insurance charges to the builders of the power plant. Mr Kupčinskas asserted that after such a move he would definitely face accusations from opposition as regards the confusion of public and private interests, thus, he refused to prepare an official letter to the German insurance company “Euler Hermes Kreditversicherungs-AG”.

 

At the end of December a billion-worth project was presented to the members of the Council of Kaunas City. In case the meeting of Kaunas City Council had been held as planned, Rimandas Stonys, the Head of Kauno elektrinė, would have been the last but one to provide information on the construction of the new power plant. Members of the Municipality Council had planned to include the consideration of the project on the 48^th line of the meeting agenda.

“The more project, planned in the National Energy Strategy, is developed, the more stormy discussions are likely to arise even though its benefit to Kaunas city, which has no other secured heat producer, is obvious”, during the presentation of the project to the members of City Municipality Council stated Rimandas Stonys, the Head of Kauno elektrinė, which is implementing the project.

 

 

“Kaunas heat economy is at a critical threshold; the city does not have any reliable source of heat production. Even the boilers of KHPP have been in use for more than 30, whereas in Petrašiūnai Power Plant over 40 years. From 2015 equipment of energy generation companies must be in compliance with the European environmental and technological standards”, said Mr Stonys.

 

Mr Stonys stresses that the current Kaunas Heat and Power Plant (KHPP), which supplies heat to Kaunas, generates up to 95 % of overall heat demand to the integrated heating network of the city. KHPP is the major heat producer in Kaunas but, in pursuance of the renewal of the old power plant, it would be necessary to inject the investment of around 350 million litas so that the existing facilities become adapted to the latest environmental and technological standards. There can be no guarantees that such investment would prove to the city because the heat, based on the calculations of specialists, would be likely to get more expensive by around 55 % to the residents. Whereas after the construction of a new power plant, according to Mr Stonys, energy generation would clear the way to the reduction of heat production price in Kaunas by around 20 %.

 

The new combined heat and power plant is constructed at the expense of investors only. Power plant construction in Kaunas attracts Western commercial banks and the European pension funds, which ensure financing and transparency of mobilisation of funds. Western financial institutions agree to contribute even during the economic crisis. Credits are insured by the state German company “Euler Hermes Kreditversicherungs-AG”.

The Finnish company “Poyry Energy”, which consults the construction of the power plant, will take part in organising an international tender for the general contractor of the new Kaunas Power Plant and supervising the construction process. Following the evaluation of the Register of Energy News (ENR), “Poyry” is considered to be the best world consulting and design company of combined heat and power plants.

International contract tender will commence in February. In October it is expected to sign the power plant construction contract. Furthermore, a detailed feasibility study for the selection of conception of the technical design was conducted, environmental impact assessment report was prepared and approved, the permit for the development of power plant capacity was obtained from the Ministry of Economy, the study of the cable power connection selection was conducted, which is meant for energy connection with the national distribution network, as well as project financing was ensured and guarantees were obtained. It shall be stressed that GAZPROM is ready to ensure steady gas supply to the power plant for 20 years.

The new Kaunas Power Plant will come into operation in the spring of 2013. Electricity, produced in this plant, would definitely lead to cheaper heat for Kaunas inhabitants. Technology of combined cycle gas turbines is highly valued all over the world due to their low environmental pollution level and high energy generation efficiency. A number of such kind of power plants has been constructed not only in the Western Europe but also in the neighbouring Sweden and Latvia. The first power plant of such type has already been built in Lithuania, namely Panevėžys.

 

According to the belief of Raimundas Kaminskas, the Chairman of Anticorruption Commission of Kaunas City Council, there are not only economic but also some sort of political estimates: “It is necessary to clarify whether this project is not in conflict with the provisions of the Law on the Basics of National Security.”

Some of the members of Kaunas City Municipality Council were concerned with the possible suspension of GAZPROM gas supply to Lithuania.

While presenting the project of a planned billion-worth power plant project to the members of Kaunas City Council once again, Mr Stonys called the fears of GAZPROM dominance in the energy economy or possible suspension of gas supply as flamboyant.

“Up to the present moment gas supply to Lithuania has never been cut off; in addition, GAZPROM is one of the shareholders of the future object, i.e. the new Kaunas Power Plant. Given that, GAZPROM itself is concerned with the successful execution of the investment project of the new combined heat and power plant”, said Mr Stonys.

 

 

 

 

Critical operation threshold is 30 years

 

 

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