Ecology, Energy, EU – Baltic States, Good for Business, Industry, Lithuania, Markets and Companies

The launch of the unit, which was due in the fourth quarter of 2021, may be delayed up to one year due to the contract termination, because of potentially lengthy public procurement procedures to engage new contractors to complete the project.

"This would result in the biomass unit starting to generate revenue later, which would have negative impact on the green generation segment's revenue part for that time period," Ignitis said via the Nasdaq Vilnius Stock Exchange.

Rafako has completed some 80% of work under the contract.

However, according to the group, the contract termination with Rafako will not have impact on the Vilnius plant's waste-to-energy generation capacity development, which is handled by other contractors.

Ignitis says the decision to terminate the contract with Rafako was made on October 5 after the company received a statement from Rafako on October 5, declaring its intent to terminate the contract and after evaluation of the contractor’s technical and financial inability to fulfill the contract.

Ignitis says it does not accept the arguments presented in the statement and intends to protect its rights using measures provided in the contract.

Valued at 350 mln euros, the Vlnius CHP plant is set to start heat production in November.