Czech utility Plzeňská teplárenská aims to begin building first of two combined-cycle gas plants this year

Plzeňská teplárenská, the largest heat supplier in western Bohemia, aims to begin building the first of two combined-cycle gas plants for heat and power generation in the middle of this year, with the two projects together expected to cost around seven billion crowns. The company is due to select a supplier for the Teplárna plant in Doubravka, which is expected to account for about 40 percent of the total, in mid-May, and will launch a tender for the more expensive Energetika plant at the Plzeň Škoda site in the coming days. CEO Václav Pašek told ČTK. The company, majority-owned by the city of Plzeň and 35 percent owned by Daniel Křetínský's EPH group, expects both projects to be operational by the end of 2029.

The company's largest investment to date is being driven primarily by the planned end of coal burning in district heating from 2030, a sharp rise in emissions allowance costs and environmental reasons. The project to decarbonise both heat and power plants will ensure a shift away from coal to gas and, in the longer term, hydrogen. Plzeňská teplárenská has been granted a subsidy of 3.2 billion crowns from the EU Modernisation Fund. It has also secured approved operating support for CHP (combined heat and power) for 15 years from the commissioning of both plants.

"The public tender for the first plant has been open since the end of 2025, so it is now nearing completion. And if all goes well, we would announce the winner at the board meeting on 19 May and sign the contract," the CEO said.

In June, the company should then hand over the construction site to the supplier. The EPC contractor, which will provide a turnkey delivery, can immediately begin designing and preparing facilities for the construction. Ground should be broken at the end of this year," he said. Three candidates qualified for the tender, but after participants withdrew, only one bidder remained: a consortium comprising SES Tlmače and the companies Metrostav and I&C Energo. According to Pašek, this is because similar plants are being built across Europe; in Czechia, they are being developed by ČEZ, Veolia and others. "The market is very saturated, even though we started very early," he said.

In May this year, the board is due to approve the launch of a public tender for the Energetika plant, which would begin immediately. The greenfield project will include cogeneration units with gas engines. At the Teplárna plant, the company plans to install "only" a new gas turbine and heat-recovery steam generator, which will be integrated into the existing technology. At the Energetika site, the company will build an entirely new plant.

"We want to complete the Teplárna plant by February 2029, while Energetika should be completed in the middle of the same year," Pašek said.

The investment will not increase heat prices in Plzeň. Based on current assumptions, we expect year-on-year increases in heat prices only around the rate of inflation," he said. The company has substantial savings in addition to the subsidy and also plans to use a bank loan.

Total budgeted costs amount to seven billion crowns plus inflation. "But a number of companies are now telling us that, due to the situation in Iran, they cannot guarantee prices and delivery dates. So if the conflict does not end quickly, it could have an impact," Pašek said. For example, steel producers may say that, with gas twice as expensive, they cannot meet the quoted prices.

Plzeňská teplárenská is drawing on experience from similar projects at other EPH Group heating plants—in Komořany, which started first and already has a boiler and is awaiting a turbine, and in Opatovice, where construction has also begun.