ČEZ wins CZK 7.5 billion grant to convert Czech coal-fired power plant in Mělník

Energy company ČEZ will use a grant of 308 million euros (around CZK 7.53 billion) to convert its coal-fired power plant in Mělník to a new gas-fired facility. The company received the funds from the Modernisation Fund. The plant’s existing coal-fired units are to be replaced by a new combined-cycle gas-fired plant with hot-water heat storage. Ekonomický deník reported this today. It is the largest grant awarded from the Modernisation Fund to date.

Energotrans in Mělník is the largest district heating source in the Czech Republic, providing heat to the eastern half of Prague, Mělník and Neratovice. The power plant has used brown coal since 1960. However, as part of its planned move away from coal combustion, ČEZ intends to switch to other energy sources. For the Mělník plant, it is planning a combined-cycle gas-fired facility.

„The project is currently in the tendering phase, and we expect to sign a contract with the winner next year. For the hot-water heat storage, tender documents are being prepared for a procurement process that will start early next year,” ČEZ spokesperson Ladislav Kříž said.

According to the newspaper, ČEZ has planned the plant’s conversion in three stages, with completion scheduled for 2026, 2029 and 2030. The three new energy facilities are to have a combined electrical capacity of around 1000 megawatts, supplemented by a 140 MW backup gas boiler house. They are expected to consume 1.35 billion cubic metres of gas annually, equivalent to a 15 to 20 percent increase in gas consumption in the Czech Republic. ČEZ has previously said that converted coal-fired power plants should be built to enable possible future hydrogen combustion. Another innovative feature is expected to be the use of hot-water heat storage technology.

The Modernisation Fund was established by the European Commission to help accelerate the shift away from coal combustion and reduce greenhouse gas emissions. It is financed by EU revenues from the sale of emission allowances. Thanks to high allowance prices, the Czech Republic is expected to have up to CZK 500 billion available through the Modernisation Fund by 2030. The funds are revenues for the State Environmental Fund of the Czech Republic and will be distributed in stages through ten grant programmes supporting low-carbon technologies, the modernisation of energy systems and improvements in energy efficiency.

The grant for the conversion of the Mělník power plant is the largest to date. ČEZ has previously received more than CZK 6 billion from the Modernisation Fund to build a waste-to-energy facility (ZEVO) in Mělník.