Acciona Unit, Rafako Win $1.4 Billion Power Contract

Mostostal Warszawa SA, a unit of Spain’s Acciona SA, and Rafako SA, Poland’s largest power engineering company, won a 4.4 billion zloty ($1.4 billion) contract today from power producer Tauron Polska Energia SA.

Poland’s second-largest utility, which rejected bids from China National Electric Engineering Co. Ltd., Alstom SA and SNC-Lavalin Group Inc., will sign a deal with the Rafako-led group to build a 910-megawatt, coal-fired plant in Jaworzno in the second quarter, it said in a regulatory statement.

State-controlled Tauron, based in Katowice, Poland, picked the builder of its biggest investment project almost two years later than planned. Tauron shares declined as much as 2.5 percent to 4.78 zloty and traded 1.9 percent lower at 4.81 zloty at 2:37 p.m. in Warsaw.

“Investments in coal-fired power plants at current electricity prices aren’t well perceived by the market,” Stanislaw Ozga, an analyst at PKO Bank Polski SA, said by phone today. “The decision took longer than planned and investors might have thought the project is being delayed or suspended.”

Falling Prices

Electricite de France SA, Europe’s biggest power producer, last month suspended a 1.8 billion-euro ($2.4 billion) plan to build 900 megawatts of coal-fired generation in Poland as European demand dropped.

Polish power prices fell 23 percent to record low 164.5 zloty per megawatt-hour in the last 12 months, the steepest decline in Europe, according to data compiled by Bloomberg.

Mostostal shares jumped 5.9 percent to 14.8 zloty at 2:37 p.m., heading for the highest close since July 2012. Rafako, a unit of bankrupt builder PBG SA, gained 0.1 percent to 9 zloty.

In the past 12 months Polish utilities chose builders for five new power plants that will add about 4,700 megawatts to the country’s existing capacity of 37,700 megawatts. That’s 21.6 billion zloty of investment that will help builders offset a drop in revenue as the government cuts road investments.

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