Announced 200m EUR worth of investment in power plant Novi Sad - company "Energija" founded

Company for combined production of electricity and heating energy "Energija Novi Sad", which anticipates 200m EUR worth of investments in Steam Power Plant - Heating Plant (TE-TO) Novi Sad, was founded today (July 6, 2009) in Novi Sad.

The contract on founding of the company was signed by Igor Pavličić, the Mayor of Novi Sad, and Dragomir Marković, the CEO of "Electric Power Company of Serbia" (EPS).

The contract anticipates modernization of TE-TO and construction of another block for production of electricity and energy for central heating.

Marković said that, according to the contract, "Energija Novi Sad" should find the partner "who would invest about 200m EUR in the cutting-edge unit in Serbia".

- Tender dossier will be ready until September, and we optimistically expect to attract foreign partners at the beginning of the next year - said Marković and added that the new block should be built in 2012.

According to his words, the investment partner should provide the funds for construction of new gas-steam block of 450 MW and 300 thermic MW for remote heating system in Novi Sad.

The Mayor of Novi Sad, Igor Pavličić, said that that investment, if realized, would cut annual remote heating costs by 200-400m RSD.

Existing TE-TO Novi Sad produces electricity, heating energy for Novi Sad and technology steam for Oil Refinery Novi Sad.

Over the last few years, the unit has been used mainly during winter months, for the needs of heating in Novi Sad and supply of power to Serbia.

Due to insufficient engagement and large costs, the price of electricity significantly exceeds the price of 1 kWh produced in lignite-powered steam power plants, which currently makes the work of TE-TO Novi Sad economically unsustainable.