In a communiqué remitted to the editorial office, Hidroelectrica points out: “Andritz Hydro GmbH has definitively lost in Vienna’s legal circuit its appeal against Hidroelectrica’s request to forcibly execute the bank guarantees issued by UniCredit Bank Austria, totalling EUR 8 M, for the technological upgrade works on the power plants located along the Lower Olt River.”
In 2004, Hidroelectrica and the Andritz-Voith Austrian-German consortium signed a contract for the technological upgrading of the Ipotesti, Draganesti, Frunzaru, Rusanesti and Izbiceni power plants located along the Lower Olt River.
The five power plants, which became operation in 1987-2000, are equipped with 20 hydropower groups, each of them with an installed capacity of 13.5 MW.
“The value of the contract was EUR 400 M. This consortium was offered, ever since 1997, all contracts for Hidroelectrica’s upgrades: Iron Gates 1, Iron Gates 2, Lotru Ciunget, Lower Olt River. The value of these contracts surpasses EUR 1 bln,” the communiqué adds.
The power plants located along the Lower Olt River were upgraded in 2006-2013. According to Hidroelectrica, a phenomenon of corrosion appeared during the warranty period. Thus, all steel components of the turbine and of the turbine engine started to corrode. The company asked the consortium to remedy the problem or replace the affected equipment.
Against the backdrop of the consortium’s refusal to take responsibility for the corrosion and for other technical problems left unsolved, last July Hidroelectrica asked UniCredit Austria to forcibly execute the bank guarantees issued by the two companies as warranty, guarantees worth a total of EUR 15.6 M.
“Both Voith Hydro Holding and Andritz Hydro made overtures meant to block the execution of the letter of bank guarantee, by starting legal procedures in Austrian courts.” In the end the court case was won by Hidroelectrica. On February 19 this year, the Vienna Regional Court also rejected the appeal filed by Andritz, the ruling thus becoming final and executory.
Following this decision, Hidroelectrica announces that it will execute the letter of bank guarantee next week.