17:40 16.04.2024

Clear Energy forced to shut down its three 22 MW biomass TPPs mid-winter due to lack of profitability – head of supervisory board

2 min read

Clear Energy Group, which is engaged in the construction and operation of biomass thermal power plants, wind farms, solar power plants, and landfill gas utilization stations, has been forced to halt the operation of its three biomass thermal power plants with a total installed capacity of 22 MW since the beginning of this year due to the lack of profitability in electricity production. This information was shared by Petro Bahriy, the Chairman of the Supervisory Board of the group.

"The price of wood chips has significantly increased. The State Forest Resources Agency regulates the price of its timber and sets price limits. Acquiring wood chips at the price they offer is not profitable for us, even with the feed-in tariff, which is 12.39 euro cents per kWh," he said at a thematic press conference on distributed generation development held at Interfax-Ukraine in Kyiv on Tuesday.


According to him, a similar situation exists for other similar plants (according to the Ukrainian Bioenergy Association, as of the end of 2023, there were 178 MW of installed capacity for biomass thermal power plants, most of which operate on husks).

"Now, we plan to resume operations during the summer period because there needs to be some profitability. There is no wood consumption during the summer, and the price has decreased. Of course, we are trying to build reserves for the winter. We worked almost until January this winter and then had to stop," Bahriy said.

He emphasized the need to strike a balance of interests between producers and raw material suppliers to ensure at least minimal profitability for biomass plants, at least at the 15% level.

Bahriy also cited the example of Lithuania, where auctions for raw material sales first satisfy the needs of energy companies and then address other demands.

Another problematic issue affecting the operation of bioenergy projects, which exacerbates the aforementioned problem, is the debt of state-owned enterprise Guaranteed Buyer for electricity already purchased.

"The debt owed by Guaranteed Buyer to our group currently amounts to nearly UAH 200 million. Under such conditions, it is challenging to operate normally," said the Chairman of the Supervisory Board.

He pointed out that the group has two more biomass plants with capacities of 12 MW and 6 MW at the launch stage, but they are not put into operation because "they would generate losses."