The National Assembly of Slovenia has approved an emergency bill aimed at preventing the bankruptcy of the country’s last remaining coal-fired power plant, TPP Sostanj, and its only active coalmine in Velenje, which supplies coal to the plant. The bill allocates 403 million euros in transitional funding through 2027.
Under the bill, the two companies will be transferred from the state-owned power utility HSE to the Slovenian Sovereign Holding (SSH), which manages state-owned assets. From 1 January 2025 to 30 April 2027, TPP Sostanj will primarily focus on providing heat energy to the Saleska Valley, with electricity production becoming secondary. The plant will operate at reduced capacity, generating only 40-45% of its full output. It will sell 70-90% of its electricity to the market operator Borzen based on a predefined production schedule, with the remainder sold at market prices.
As district heating is considered a public service, the state is allowed to subsidize its costs. The bill includes 324 million euros for district heating and 79 million euros to cover outstanding loan payments.
Both TPP Sostanj and the Velenje coalmine have faced financial difficulties for years, primarily due to high production costs at the power plant driven by expensive carbon allowances. TPP Sostanj, which became controversial after the completion of its Unit 6 in 2014 at a cost of 1.4 billion euros, has been unprofitable in all but one year since. Under EU state aid rules, HSE can no longer finance these losses, prompting the government to intervene in order to maintain district heating and prevent mass layoffs that could destabilize the region. The Velenje coalmine employs 2,000 people, while TPP Sostanj has 400 workers.
Initially, the government planned to support the power plant for five years, but this period has since been reduced to two and a half years. During this time, new laws regulating the coal phase-out will be introduced.
