GERMANY’S utilities, battered by the country’s shift to wind turbines and solar panels, would be glad to sell you a power plant on the cheap. They’ll even pack it up and ship it to another country.
The two largest power producers, RWE and E.ON, are keen to sell their gas-fired plants, rendered uncompetitive by the rise of renewable energy on the one hand and record low coal prices on the other. It’s a fairly easy task to take them apart, move them by truck and ship and reassemble them elsewhere.
Sometimes people will buy whole plants, others the key components. The giant power-generating turbines that lie at the heart of the station cost at least $30 million (R349m) and buying second-hand can shave more than a third off that price, particularly attractive for buyers in developing countries.
“There is a liquid global market for gas turbines,” RWE deputy chief executive Rolf Martin Schmitz said recently. Selling the plants, whole or in parts, is one option, he said. “Transport costs are marginal.”
The company sold turbines from a dismantled nuclear plant to be shipped to Egypt in 2012. RWE has more than six gas-fired generators mothballed in Germany and the Netherlands, which may never be needed in their home markets again.
RAG Mining Solutions is a broker for used power plants and components stripped out of them. Its website advertises 10 different plants in Germany, coal and gas-fired, which are for sale as a whole, or in bits.
A used plant is at least one-third cheaper than a new one, RAG Mining Solutions chief Martin Junker told Westdeutsche Allgemeine Zeitung in August. “It’s quicker to dismantle and assemble an old plant than a complete new building,” he said, adding that he saw markets in Russia, Asia and Africa and possibly Chile.
RAG declined to comment.
German plants are for sale because the shift to renewable energy, expected to provide 45 percent of power by 2025, has collapsed electricity prices. Power for delivery next year fell to the lowest since April 2004 last month.
Confronted with such a bleak market, E.ON established a decommissioning unit last year. It first tries to sell turbines and other components within the company. If that fails it looks for buyers for bits of the plant or the whole thing, spokesman Markus Nitschke said. “There are increasing requests for components and sometimes for a complete plant.”
It’s not just in Germany. E.ON will move its 430 megawatt Malzenice gas-fed plant in Slovakia should attractive conditions emerge, the utility said in May. Because of a weak local power market, the facility operated for less than three years before it was idled.
The supply of second-hand power generators is one factor weighing on turbine manufacturers General Electric and Siemens, which said last week that turbine prices fell about 4 percent last year. The Munich-based company is cutting 1 200 jobs from its energy operations as it reduces its gas turbine manufacturing capacity.
Stadtwerke Muenchen, Germany’s largest municipal utility, plans to shut down two gas turbines at its Freimann heating plant this year, and to sell no longer needed components, said spokesman Christian Miehling.
“For smaller gas turbines there is a good market,” said Schmitz. “For big facilities the market is smaller.” – Bloomberg