Interview with Executive Director Ivan Bulatović for Pobjeda:
CGES satisfied with the dynamics of the project construction of undersea power link with Italy.
Cable to be connected to national transmission system next year
The dynamics of performance of works to ensure connecting of power undersea cable to transmission network of Montenegro, which Crnogorski elektroprenosni sistem is in charge of, complies with the dynamics of works on part of project implemented by Italian company Terna, told CGES Executive Director Ivan Bulatović. He recalled that the construction of overhead line Lastva-Čevo-Pljevlja, substation Lastva and cable is part of Trans-Balkan corridor, which will connect Montenegro, Serbia and Romania to ensure coupling of Balkan market and Western Europe.
On the list of EU
Undersea power cable between Montenegro and Italy is included in the official lists of the projects of European Union and Energy Community interest. Some phases of such a big project will be completed during this and next year, when the connection to existing transmission system of Montenegro is expected, told Mr. Bulatović for Pobjeda. Agreement on connection of Italy and Montenegro with cable was signed in mid-November 2010, and the total value of the project is worth a billion euro.
The construction of cable places Montenegro as an important energy node. It is important that the construction of these capital projects will ensure preconditions for further development of transmission system of Montenegro, told Mr. Bulatović, and recalled that the construction of overhead line "Lastva-Pljevlja” commenced in 2011 by signing a strategic and shareholders agreement and project coordination agreement between the State of Montenegro, Terna and CGES.
The total value of this investment, which includes constructing the substation Lastva, 400kV, overhead line Lastva-Čevo-Pljevlja and connecting existing 400 kV overhead line Podgorica-Trebinje to SS Lastva, is worth 106 million euro, or 127 million euro if we count the construction of overhead line from Pljevlja to the border with Serbia, as well as investments in internal grid, for which investment EU donation is provided, told Mr. Bulatović.
He explained that the overhead line from Lastva to Pljevlja is 194 kilometre long with 670 towers.
As he told, works on the substation Lastva, the value of which is 30 million euro, have been performed according to satisfactory dynamics.
CGES completed 90% of activities and the substation is expected to be completed during this year. Works on the overhead line (designing, purchase of equipment and performance of works) have been progressing slightly slower, told Mr. Bulatović. The construction of the overhead line and substation is part of the associated infrastructure which will be used for connection of electric power systems of Montenegro and Italy.
Substation
The construction of 400 kV substation will create preconditions for a long period of time for dynamic development of new tourist complexes, new sources and their connection to transmission network. Transmission network in the coastal area will become stronger and more reliable by inserting an additional point, besides Podgorica, from which the coastal area is to be supplied with power – emphasized Mr. Bulatović, and explained that 98% of expropriation process for tower spots has been completed, and providing the access to towers is nearing completion.
The expropriation process is very complex. CGES, as a responsible company, is trying to find optimal solutions for all parties. We are aware that this is not always simple, but we will use all statutory possibilities to implement the investment with the minimum number of unsatisfied parties, told Mr. Bulatović. He emphasized that EU recognized efforts of Montenegro and CGES in participating and implementing major projects of reinforcement of electric power infrastructure, and it awarded 25 million euro of grant to the company, which will relax transmission tariff in the applicable regulatory period. The key investments of CGES from 2017 to 2019 are the construction of overhead line 400 kV Pljevlja2-Bajina Bašta and Pljevlja2-Višegrad, to the border with Serbia, substation Brezna-I phase and the connection to the overhead line 110 kV Nikšić-Brezna, replacement of high-voltage equipment in substations and reconstruction of protection and control systems in the entire network.
This year the planned implementation of the above investments is worth 7,5 million euro. The value of total investments in the first six months of the current year is worth 10 million euro, told Mr. Bulatović, and added that they entered into favourable loan arrangements with the European Bank for Development and Reconstruction and German Development Bank.
-A significant part of our investments are financed through ordinary course of business of the company and with the understanding of shareholders that part of accumulated profit is used to complete the priority investment projects within the envisaged deadline, told Mr. Bulatović, and stressed that all planned and extraordinary overhauls were carried out and paid visits including examinations in order to make the system steady in tourist season. He recalled that formal preconditions were created for the formation of Montenegrin Energy Exchange, with the formal registration expected to ensue afterwards.
-The Exchange is expected to influence the creation of referential prices of electricity in Montenegro. From a long-term perspective, putting the cable in the commercial use is expected to bring the exchange to its full capacity. Coupling of regional exchanges is also expected in the near future, told Mr. Bulatović.
12,2 million euro claimed from EPCG
According to Mr. Bulatović, CGES claims the amount of 12,25 million euro of the principal debt from Elektroprivreda.
-Out of 11 litigations conducted upon CGES’ complaints against EPCG before the Commercial Court for the collection of a fee for transmission capacity use from early 2014 to 31 July 2015, first instance judgements have been rendered for six cases in our favour, told Mr. Bulatović and added that he expected the Appellate Court to reject EPCG’s complaints.
Satisfied with business performance
CGES ended the last year with net profit amounting to 2,4 million euro, 1,6 times less than in 2015.
The result is more than satisfactory considering the conditions in which it was achieved, and better than the planned. Due to a huge investment cycle which the company is faced with and demanding regulatory framework, such result makes space for satisfaction and optimism, told Mr. Bulatović.
S.POPOVIĆ