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RWE details forward power hedges of German plants
May 15, 2017 / 7:04 AM / 5 months ago

RWE details forward power hedges of German plants

ESSEN, Germany, May 15 (Reuters) - RWE has sold the bulk of its 2018, 2019 and 2020 power generation from nuclear and brown coal-fired plants in Germany, the utility’s first-quarter earnings report showed on Monday.

* For 2018 it hedged more than 90 percent of German power volumes at around 27 euros ($29.53) per megawatt hour, for 2019 more than 80 percent at 26 euros/MWh and for 2020 over 70 percent at 27 euros, RWE said.

* By comparison, German calendar year 2018 baseload power in the wholesale market on Friday closed at 28.75 euros, 2019 power was at 27 euros, and 2020 at 27.20 euros , Thomson Reuters data showed.

* RWE rivals Uniper and E.ON last week also detailed hedging ratios and prices, which wholesale energy traders track to assess the size of future volumes already tied up with counterparties, and the value of forward production.

* RWE also produces electricity in hard coal and gas-fired power stations in Germany and other EU countries.

* Electricity delivered last year from RWE’s German plants fetched 35 euros/MWh on average while over 90 percent of 2017 sales so far have been priced at 31 euros.

* The earnings report showed RWE now splits its Lignite (brown coal) & Nuclear segment from the other assets that are now called European Power.

* Lignite & Nuclear performed lower in Jan-March and full-year adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) will likely be “much lower” than last year, it said.

* Blaming lower realised generation margins, it also said that the European Power segment will post a lower 2017 EBITDA, despite optimisation measures.

* The current German price payable for round-the-clock power delivered in 2018 of 28.8 euros a megawatt hour (MWh) is up 44 percent from its 20 euros low in 2016, but still just half its level in 2011.($1 = 0.9142 euros) (Reporting by Vera Eckert; editing by Jason Neely)

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