Narva industrial park offers site for generator to supply cheap power
The Narva industrial park is offering land for a power producer to supply cheap electricity to energy-intensive firms.
The local grid operator warns this would hike domestic bills, however
The construction of a direct line connecting the Baltic Power Plant with the Narva industrial park came very close to reality four years ago. The industrial park pledged to design the direct line; Eesti Energia subsidiary Enefit did the same on building the connection point, and the City of Narva promised to support the project financially. At the time, however, only the industrial park kept its promise.
Energy-intensive companies still need cheap electricity as a competitive advantage, however, meaning the industrial park has not buried the idea of a direct line, seeing the timing to do so currently favorable.
"Just now a heat supply tender has been announced in Narva, which means that those companies who come to the market to offer heat energy to the city of Narva will likely also be interested in building combined heat and power plants, where either electricity is produced as a byproduct of heat generation or vice versa. Electricity production is built next to large consumers, and with a direct line it would be possible to offer this electricity and price directly to different companies," said Teet Kuusmik, member of the management board of regional investment agency IVIA.
With direct line electricity, a major consumer does not have to pay the grid fee, spelling prices up to 33 percent lower.
This is especially important for the new magnet factory which has opened in Narva; its electricity consumption could be compared to that of the entire city of Narva, population around 55,000.
On the other hand, a large consumer of that size leaving the grid would create problems for the grid operator and, consequently, for small consumers too.
"In other words, electricity consumption via the grid falls, costs have to be spread over a smaller amount of sold electricity, and the electricity bill, the grid service bill, for those small consumers will definitely rise. We have costs, and those costs will be transferred to those same apartment residents of Narva," Andres Meesak, head of innovation and regulatory relations at grid distributor Viru Elektrivõrgud, said.
The grid operator says it would be willing to sell electricity more cheaply to major consumers, but the Electricity Market Act does not allow it.
The deadline for submitting bids for the district heating tender is December 1, after which it will become clear whether district heating producers in Narva also want to produce direct line electricity in addition to heat (district heating).
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Editor: Johanna Alvin Andrew Whyte
Source: 'Aktuaalne kaamera'
