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MET Group: We are looking for new projects in Serbia
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MET Group: We are looking for new projects in Serbia

April 4, 2019
NIS and Swiss-based MET Group have recently set up a joint venture for the construction of a 102 MW wind farm in northern Serbia (Autonomous Province of Vojvodina). Attila Szaniszló, MET Group’s Country Chairman responsible for Serbia and Péter Horváth, Director of Strategy and Business Development at MET Power tell us more about this renewable energy project.

eKapija: MET Group and NIS will build a 102 MW wind park consisting of 34 wind turbines next to the Serbian municipality of Plandište. What led MET to choose NIS for a partner, as neither of the two companies has had any experience with wind farms?

- Indeed, this is the first wind project for both MET Group and NIS, and also for Gazprom Neft, the majority owner of NIS. We have been involved in this project since late 2016, and after lengthy preparations and complex negotiations MET acquired its 50% share in the project this March, forming a joint venture with NIS. As a pilot project, we are continuously gaining more and more insights, and we use each other’s competences while building Wind Park Plandiste.

eKapija: Could you tell us the estimated worth of the overall investment?

- Preparatory works are still ongoing, so we cannot provide you with an exact figure. However, to give you an estimate, the total value of the project is well above EUR 100 million.

eKapija: Has it already been agreed who will produce the necessary equipment, and which companies will carry out the construction works?

- Not yet, we are still in the selection process. The construction of the wind park will start this year and it is expected to be fully operational in 2021. The investment will supply power equivalent to the consumption of around 85,000 households, i.e. about 250,000 people.

eKapija: What is your opinion on the current Serbian legislation with respect to investment in renewable sources of energy?

- Wind Park Plandište will be included in the Serbian feed-in tariff scheme, guaranteeing its profitable operation. MET has been present in Serbia for years, and we think that investment conditions and services are favorable here. Even if the country is not yet a member of the European Union, its legal system is harmonized with EU standards, and incentives for investment are already present. The offered Power Purchase Agreement (PPA) is therefore bankable.

eKapija: MET Group CEO Benjamin Lakatos stated that the joint venture was also “a great stepping stone for MET to build a more significant presence on the Serbian energy market”. Are there any plans for new investments in Serbia in the foreseeable future? Is Serbia a promising market?

- Yes, we definitely have plans for new projects and new investments in Serbia, as it is an excellent market with great business opportunities. We are continuously looking for new investment opportunities all over Europe, and if we see another appropriate project in Serbia fitting into our strategy, we will certainly evaluate its merits.

eKapija: It was said that the company aimed “to establish a renewable energy production portfolio of several hundreds of megawatts in Central and Eastern Europe, including both solar and wind projects”. Are we going to see more wind farms, or solar energy plants by MET Group in the region of Central and South-Eastern Europe?

- The primary goal for MET Group is to create a diversified energy portfolio, in which renewables play a key role. In addition to sustainability considerations, we see renewable energy production as a business opportunity too. MET has already built a 17,6 MW solar power plant in Hungary (Százhalombatta), and now we have joined forces with NIS to build the wind park in Serbia. We are constantly building our project pipeline and examining other possibilities in the CEE region. 

eKapija: Could we also expect investments in the natural gas and oil market in Serbia, given that they are within your company’s portfolio? 

- MET has been present in Serbia for several years, fully licensed and active in trading natural gas, electricity and oil products. We will thoroughly study all other investment opportunities.

eKapija: Would you advise companies or consortia from other branches of industry to start investing in the renewable sources of energy in Serbia and wider, or is it too late to step into the business now?

- It depends on the strategic goals and the risk-taking appetite of a company whether it wants to enter a specific market or not. In any case, it is in the interest of all governments to support renewable energy. The volume of tariffs and the length of compensation periods are rather similar in European countries. We can now see a decreasing trend in tariffs as investment costs are getting lower as well.

eKapija: Can you tell us something more about MET Group’s overall plans, not only in Serbia?

- MET Group has followed an intensive growth strategy in recent years, opening several new subsidiaries in Europe. MET is now present in 15 countries through subsidiaries, 28 national gas markets and 22 international trading hubs. The goal is to continue this growth – as a European energy company, we would like to become a leading energy market player on the continent. Just to give you two examples: MET traded 35 billion cubic meter (BCM) of natural gas in 2017, its consolidated revenue in the same year was EUR 7,6 billion. A key element of MET Group’s business strategy is the development of a diversified asset portfolio, in which Wind Park Plandiste will be an important part. MET has already built a 17,6 MW solar power plant in Hungary, it is the majority owner of the country’s largest gas-fired power plant, and it owns Hungary’s biggest natural gas distributor Tigáz, with a 33,000 km-long pipeline network representing 48% of the total gas grid. MET Group now has access to a total of EUR 959 million in credit facilities, almost reaching the EUR 1 billion bar. This funding base will support the company in its long-term growth strategy.

eKapija: Could you give us some details on your company’s organization, being owned 100% by its managers and employees? Are they all shareholders, and does this make them more motivated to work for the collective well-being of the company?

- We decided to change the ownership structure of MET Group, and executed a management-buy-out in May 2018. Thus, MET has transformed into a 100% management-owned company. Last year, about 60 MET Group managers were invited into the share program. From 2019 on the circle of owners will broaden, based on the performance of employees. Cultivating human capital makes the difference and this ownership approach ensures the maximum performance of our colleagues, motivating them even more.