The Slovenia Times

Power utility HSE bailed out by the state

TEŠ, the Šoštanj coal-fired power station, in the Savinja-Šalek region.
Photo: Daniel Novakovič/STA
File photo

State-owned power utility Holding Slovenske Elektrarne (HSE), the largest producer and trader in electricity on the wholesale market in Slovenia, has received a capital hike of almost half a billion euros from the state to shore up its liquidity amid major problems at its core hydro and coal generation facilities.

The first instalment of €300 million has already been paid, and the second round of €192 million will follow in mid-December, Slovenian Sovereign Holding, which manages state-owned stakes in companies, announced on 5 December.

The purpose of the capital increase is to "bridge the liquidity deficit at HSE and secure its stable operations," Slovenian Sovereign Holding said.

The HSE group has found it challenging to cope with the energy crisis and has been affected by record-low water levels, which severely reduced the output of its hydro plants.

The group's coal production has also faced problems, particularly with the Šoštanj coal-fired power station, which was restarted earlier this week, having to shut down for more than a month due to coal supply problems. Šoštanj normally accounts for about a third of domestic electricity production.

What is more, commercial banks have been unwilling to provide additional liquidity financing despite an €800 million state guarantee put in place last month, HSE said.

The company said the crisis will have a negative impact to the tune of €460 million by the end of the year, a shortfall it cannot offset.

"Moreover, higher electricity prices on the market and increasing price volatility have a significant effect on the extraordinary increase in needed liquidity funds to protect the sale of own electricity production and the required CO2 coupon purchases," it said.

The money comes from a special €750 million appropriations in this year's budget designed explicitly for recapitalising state-owned energy companies.

It was initially thought that Geoplin, the country's largest natural gas trader, would have to be bailed out, but instead, it made do with a liquidity loan from its largest shareholder, the partially state-owned energy group Petrol.

Slovenian Sovereign Holding expects the additional capital will be returned to the state no later than at the end of 2024.

The HSE Group comprises the Šoštanj coal-fired power plant, the Velenje coal mine, and hydro plants on the Drava, Sava and Soča.


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