OREANDA-NEWS. June 09, 2010. Turboatom, Ukrainian turbine manufacturer, will modernize Donbasenergo`s (UX: DOEN UK) turbine at 200 MW power unit #5, Turboatom reported in a press-release yesterday. The company will deliver modernized turbine in April 2011. The modernization would increase the unit’s installed capacities by 8 MW (4%) and decrease fuel consumption by 26.1 g per kWh (down 6.2%).

Concorde Capital: power unit #5 is Donbasenergo’s oldest one, with only 2% capacity utilization vs. 32% of average for the whole company in 2009). After the modernization, we expect the unit will be among the ten most efficient ones in Ukraine. Its cost-efficiency should lead system dispatcher Ukrenergo to load this unit to the maximum permissible level (~65% incapacity utilization), which would allow Donbasenergo to hike total electricity output by ~6% in 2011 and ~12% afterwards. We estimate that ~80% of the modernization costs will be passed on to final consumers through investment surcharges to tariffs. We expect the NERC to announce approval of the investment surcharge and corresponding tariff increase later this month. We estimate total cost of modernization at ~USD 30-40 mln, or USD 150-200 per MW (vs. of USD 1,500 for new power unit).