March 27, 2013 / 4:01 PM / in 5 years

Poland's PGE cancels tender to build power unit, will re-tender

WARSAW, March 27 (Reuters) - Poland’s top utility PGE said it cancelled a tender, in which French group Alstom took part, to build a 450 megawatt lignite-fired unit in its Turow power plant and would announce a new bid to get cheaper offers.

The state-controlled PGE said in January that Alstom had placed the lowest bid - 3.8 billion zlotys ($1.17 billion), which was far above the utility’s budget and analysts expected PGE not to accept the offer.

“A new tender will be announced,” Waldemar Szulc, the deputy head at PGE’s unit PGE GiEK responsible for the project, said.

Poland’s coal-reliant energy sector requires heavy investment because many plants are way past their prime. But falling power prices raise doubts about the viability of investing in new power units. ($1 = 3.2493 Polish zlotys) (Reporting by Agnieszka Barteczko; editing by Keiron Henderson)

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