RWE’s Renewables division contributed well to the German utility’s recent positive results when variables that had a negative effect are taken into consideration.
Press spokesperson Vera Bücker told Power Engineering International that while this year’s first quarter results for renewables don’t look that impressive on first sight, given the context, it was a relatively strong performance that promises more to come.
In Q1, operating profits for RWE amounted to EUR1.7bn of which EUR154m was from renewables, approximately 10 per cent.
“Compared to Q1 2015 you see nearly unchanged operating results in the renewables division,” Bücker said, before outlining the positives and negatives that make up the overall picture.
“A positive impact came from the increased electricity production by the new wind farms at Gwynt y Môr off the coast of Wales (576 MW) and Nordsee Ost north of Heligoland (295 MW), which were not at full capacity in the first quarter of 2015.”
“Additionally there were further positive earnings due to the capital gains we realised from the sale of small hydropower plants, under 10 MW, around Germany.”
“This was contrasted by the absence of one-off income from the divestment of Gwynt y Môr grid infrastructure in Q1 2015, which is required by law.”
Along with that proviso, market conditions and policy changes also have to be taken into account.
“As you know wholesale electricity prices dropped significantly in 2016 Q1 which has a negative effect compared to last year. Also some of our renewable assets did not receive fixed feed-in fees from government, so these are exposed to market risk and the significant drop in wholesale electricity prices also weighed on their earnings.”
“If you ignore the one-off effects (involved) the renewables division would have posted a much higher result in 2016 compared to 2015. Development in this division was very pleasant which is at first glance not very obvious if you just compare Q1 results.”
RWE recently made the decision to split off its renewables, grid and retail operations into a new subsidiary, which will take a stock market listing by the end of 2016.
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