Austria revives coal-fired power option as Russia cuts gas supply

VERBUND AG

19/06/2022 21:19

VIENNA, June 19 (Reuters) - Austria's government agreed with
utility Verbund  VERB.VI  on Sunday to convert a reserve,
gas-fired power plant so that it can produce electricity with
coal should restricted gas supplies from Russia result in an
energy emergency.
    The decision, taken by a "small crisis cabinet" led by
Chancellor Karl Nehammer, came after neighbouring Germany
announced steps to address reduced Russian gas deliveries
including increased reliance on coal-fired power plants.
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    The European Union's reliance on Russian gas and the risk
that Moscow could cut supplies in retaliation for economic
sanctions imposed after its invasion of Ukraine has been a
headache for the bloc, prompting it to build up inventories and
seek alternative supplies.
    Nehammer's office said that majority state-owned utility
Verbund had agreed to convert the Mellach power plant in the
southern Styria region, which has been shut down but kept on
stand-by, for renewed use of coal.
    It was Austria's last coal-fired power plant before being
converted into a gas-fired plant for use when needed.
    "The federal government and the energy group VERBUND have
agreed to convert the Mellach (Styria) district heating power
plant, which is currently shut down, so that in an emergency it
can once again produce electricity from coal (not gas),"
Nehammer's office said in a statement.
    It added that the government was examining further legal
measures to diversify gas supplies with the aim of reducing
dependence on Russian supplies.
    Russian gas flows to Europe fell short of demand on Friday,
coinciding with an early heatwave gripping its south and
boosting benchmark prices already lifted by concerns the
continent may struggle to build up storage in time for winter.
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    Austria gets 80% of its gas from Russia and since the war in
Ukraine it has been scrambling to find alternative suppliers.

 (Writing by Paul Carrel; Editing by Chizu Nomiyama)
 ((paul.carrel@thomsonreuters.com))