Swiss, German utilities to trade hydro, coal-fired power

Swiss hydropower utility Energie Ouest Suisse (EOS) has signed an agreement with German utility RWE to exchange hydroelectric and coal-fired power.

The utilities said August 23 that the deal will go into effect Jan. 1, 2009, with an initial term of 10 years.

RWE unit RWE Trading and EOS agreed the utilities have the possibility to exchange RWE’s coal-fired base load generation — about 1 billion kWh per year — for peak load hydroelectric generation by EOS. The exchanges are to be for the next day, taking place on a �virtual� basis, based on long-term parameters.

�This way, RWE Power has short-term flexible access to peak loads, which the company would otherwise have to buy on the market,� RWE said. �The same applies to EOS, which has short-term, economical access to next-day coal-generated base loads and then, in return, can supply peak loads to RWE. There are advantages for both sides through the avoidance of bottlenecks and the efficient use of generation capacities.�

EOS, which generates 85 percent of its electricity from hydropower, said the agreement will enable it to guarantee adequate electricity to French-speaking Switzerland. The Swiss utility said reliability in the region had been jeopardized by political uncertainty in its plan to develop a natural-gas-fired combined-cycle power plant at Chavalon.

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