New owners for major power station

Energetický a průmyslový holding (EPH) and Eggborough Power, which owns the North Yorkshire-based power station, have reached a sale agreement. The deal, which is for an undisclosed sum, must be approved by the European Commission.

EPH is a central European energy group, which operates mainly in the Czech Republic, Slovakia and Germany.

It includes 40 companies involved in coal extraction, electricity and heat production from conventional and renewable sources, EPH is also the gas industry leader in Slovakia and the key shipper of natural gas from Russia to the European Union. The companies in the group employ more than 10,000 people.

Last year, the Department of Energy and Climate Change confirmed that Eggborough would not be one of a clutch of clean energy schemes to receive public funding, which led to renewed warnings about its potential closure. EPH said the acquisition of Eggborough “reflects our genuine interest in the UK market”.

Neil O’Hara, the chief executive of Eggborough Power, said: “We are pleased that EPH has made this investment and look forward to working closely with them.”

Daniel Kretinsky, the chairman of EPH, said the acquisition reflected the company’s “appreciation of the highly competent management, skilled employees, technology and location of the plant.”

Eggborough Power Station began supplying the National Grid in 1967. As a result of privatisation, Eggborough passed from the Central Electricity Generating Board to a newly created company, National Power, which was floated in March 1991. Eggborough was bought by British Energy in March 2000. In January 2009 British Energy was bought by EDF Energy. As part of that deal, Eggborough divested from EDF and became an independent business in 2010.

Today, Eggborough produces four per cent of the UK’s electricity and employs 300 staff.

Professor Christopher Bovis of Hull University Business School said the deal could be the herald of many more in the UK energy market.

Professor Bovis, who specialises in international and European business law, said Britain’s energy market “is plagued by dysfunctional price information, corporate goliaths and limited network competition”.

He added: “EPH is a sophisticated energy operator with high ambitions to increase its market share across the European Union. The UK energy market represents a priority target, as energy deals are much easier and smoother than in any other state of the EU, mainly due to reasons attributed to corporate policy and flexibility for acquisition of companies.

“During the last four years and particularly in 2011-2014, the UK has witnessed excessive price increases in energy. Profit margins of energy suppliers have increased from £15 per head to £125 per head.”

Professor Bovis said that a policy which embraced both traditional and renewable energy production methods could help to make prices more stable

Timothy Kirkhope, Conservative MEP for Yorkshire and the Humber, said: “This is a major European company investing in the region and securing jobs in Yorkshire. They are also investing in the future of British energy-production.

“The plant produces four per cent of the country’s electricity and it would have been a severe blow if it had closed – not just to Yorkshire jobs but to Britain’s energy security.

“The EU Commission must now approve the sale and I shall be doing my best to ensure that happens swiftly.

“I will work with the new owners in their plan to create a viable business for the future.”

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