Half a year of doom. A country renowned for its energy independence has apparently become, in the six months of socialist rule, a country where the state energy mastodons need to be recapitalised – in the total amount of almost half a billion euros. In October, a personal friend of Prime Minister Robert Golob, who was also his best man – Tomaž Štokelj – took over the management of the Slovenian Power Plants Holding.
The Slovenian Power Plants Holding Group, which has been classified by the government as a strategic investment, generates more than 60 percent of Slovenia’s electricity and, as such, is key to ensuring a reliable supply of electricity in the country. On Monday, the Republic of Slovenia (with the taxpayers’ money, of course) paid the first of two tranches of the necessary funding to bridge the Slovenian Power Plants Holding’s liquidity shortfall in the form of subsequent capital injections, amounting to 300 million euros, while the second tranche of 192 million euros is expected to be paid by the 15th of December 2022, following the approval by the Government of the Republic of Slovenia of an update to the annual management plan.
So, before the end of the year, the Slovenian Power Plants Holding’s power plants, which produce energy from water and sell it to consumers packaged as electricity, need half a billion euros of your money. It should be pointed out here that the first tranche was approved by the Government on the 17th of November, but you were not told that that had happened. People are too busy dancing anyway.
Why are you paying this?
The Slovenian Power Plants Holding could go bankrupt because of several factors: one is the energy crisis, and the other is the historically low hydrology this year. And while we could say that the second was difficult to foresee, other countries have been preparing for the energy crisis since February. Another factor is the suspension of the Thermal Power Plant Šoštanj – it led to the resignation of the director, and the government assured that nothing would change as the result of the power plant’s suspension. Another reason is the tighter credit conditions on international markets, which have made banks less eager to finance indebted state systems.
So, what does this mean? Slovenian hydro power plants are totally dependent on the stability of the international environment and the benevolence of international capital markets to keep them from making losses. Moreover, another proof of how much the banks “trust” the company is that they have so far obtained only 185 million euros in loans from the banks, while the state itself has provided 800 million in guarantees for it. Even with a state guarantee, commercial banks are reluctant to embark on such an “adventure.”
But apparently, nothing is the fault of the good or bad performance of the administration set up by the Golob government – not even the simultaneous shutdown of the Thermal Power Plant Šoštanj and the Nuclear Power Plant Krško, which energy experts warned would not end well – anything that goes wrong is conveniently blamed on the international situation. If such a thing had happened during the term of the Janša government, it is pretty easy to guess what kind of articles would have been written in the working people’s press – something along the lines of: “Janša’s governance is about to cause the Slovenian Power Plants Holding to go into bankruptcy – it will have to be recapitalised with 500 million euros of taxpayers’ money.”
“Taking into account the future situation and the performance of the Slovenian Power Plants Holding Group, we will pursue the objective of returning the full amount of the subsequent capital injections to the founder by the end of 2024 at the latest, or even earlier if the Group’s performance allows it,” the Ministry of Finance’s state asset manager added. In the vocabulary of state corporations, “pursuing the goal” means, of course, that we will never see this money again – at one point in the past, they were “pursuing the goal” of building the 6th unit of the Šoštanj Thermal Power Plant at the agreed price, and then they were “pursuing the goal” of building the second railway track without annexes – until Kučan’s corporate commando Petrič started printing them up like clockwork.
The power outage that happened because of the reasons described above, according to the Slovenian Power Plants Holding, “has resulted in the purchase of replacement electricity at a time when electricity prices have also risen sharply as a result of the Russian invasion of Ukraine.” While this is true, they failed to mention that the state-owned resellers have also made a fair profit from the rise in electricity prices – wholesale electricity prices are 2.4 times higher this year than they were last year, which has really hit the companies quite hard, and they are now negotiating their energy purchasing price for the coming year.
But high prices also bring huge profits to Slovenia’s state-owned energy companies. The big winners, judging by last year’s performance, are not the power plants themselves, but the resellers, such as Gen-I, which is also rumoured to be recording a loss of 700 million euros. So, once again, we are just waiting to see when this state-owned mastodon will also need to be recapitalised. So where is all of this money going?!
So, who is in charge of the Slovenian Power Plants Holding?
All roads lead back to the Sun King – Golob. In October, a personal friend of Prime Minister Robert Golob and his best man – Tomaž Štokelj – took over the management of the company. It should also be pointed out that in 2020, the Slovenian Power Plants Holding Group contributed more than 200 million euros to state and local budgets through levies, and that in the same year, the management increased the electricity production plan by 21 percent under the Janša government.
The price of electricity is among the highest in the European Union
In the European Union, prices per megawatt-hour are only higher in France and Italy, and almost the same as in Slovenia (around 240 euros) only in Croatia. Elsewhere, the prices are mostly below 200 euros. On the market, prices change literally from hour to hour. Some countries have already adopted regulations in spring and summer (Italy, Spain, Germany) to limit the cooling of rooms with air conditioning, and this winter, almost all EU Member States will set a legal limit on the highest allowed temperature for public spaces (Germany has already set a maximum of 19 degrees Celsius) and probably for private homes, too. And what is more, politicians are also considering setting 60 degrees Celsius as the maximum temperature to which water can be heated. This would reduce consumption and thus the demand for electricity, and prices would fall as a result. This is logical, because that is how the supply and demand market works, but the Brussels elites and Robert Golob have something else in mind.
The excuse of the green transition
When reading the Brussels Regulation, one also needs to pay attention to the fine print – a kind of explanatory statement. It is obvious that governments are not at all concerned about reducing the cost and rising prices for the benefit of the people but are only thinking about taking measures to “accelerate the green transition,” which means reducing the use of fossil fuels and achieving “climate neutrality” by 2050. “Renewable sources are the key to the green transition. They are the cheapest and cleanest form of energy available and can be used to produce energy in the European Union, helping reduce dependency on energy imports,” the statement reads. However, what they are not saying is that power that comes from solar and wind energy sources cannot be stored and that trillions of euros of taxpayers’ money will be needed to incentivise and build wind and solar power plants, which will be extremely unreliable in supplying electricity. In other words, the elites are telling us that electricity shortages will become the norm (for as long as they will keep trying to make the unrealistic happen).
But let’s go back to the state guarantee of 800 million euros granted to the Slovenian Power Plants Holding by the Golob government. What was the justification for the guarantee? Among other things, to buy the necessary CO2 vouchers – these are a kind of pardon that European companies with high CO2 emissions have to pay to international companies such as Tesla, which have zero emissions and therefore “sell” their CO2 vouchers to other companies – the incredible share prices of companies that manufacture electric vehicles, batteries and solar cells are in fact just a mirage – in fact, the only real earnings come from the sale of the CO2 vouchers, which state-owned companies are buying with your money in order to continue doing business as usual. In reality, you are financing the “green transition” by yourself, and you do not even know it. Meanwhile, Bill Gates, Klaus Schwab and Robert Golob are laughing at you from their private jets.
Andrej Žitnik
