|Bid||32.85 x 410300|
|Ask||32.87 x 177800|
|Day's range||31.96 - 32.92|
|52-week range||20.05 - 34.64|
|Beta (5Y monthly)||1.29|
|PE ratio (TTM)||2.44|
|Earnings date||13 Aug 2020|
|Forward dividend & yield||0.80 (2.51%)|
|Ex-dividend date||29 Jun 2020|
|1y target est||N/A|
(Bloomberg Opinion) -- For a country that prides itself on its clean, green image, Germany’s power sector is remarkably dirty.Despite having the third-largest installed base of wind and solar power after China and the U.S., Germany still relied on coal for 45% of its needs as recently as 2015. While the U.K. has been going without the fuel for months at a time, Germany’s legislation on retiring its coal fleets, which passed Friday, will keep plants switched on as late as 2038.That “as late as” is key, though. Switching off the 40 gigawatts of coal power currently in operation is structured as a series of deadlines, rather than appointments — and there are strong incentives for generators to quit the market early. With benchmark prices for coal-fired power already in negative territory right now, don’t be surprised to see the entire industry shuttered by the middle of the decade.To understand why, it’s worth considering that Germany’s main coal-fired utilities RWE AG, Uniper SE and Lausitz Energie Kraftwerk AG aren’t so much operators of industrial plants as commodity brokers trading the spread between processed and unprocessed products. Just as agricultural traders hope to make money on the crush spread between soybeans, soymeal and soya oil and refiners profit from the crack spread between crude, gasoline and diesel, coal-fired utilities trade the dark spread.The dark spread represents the price of electricity in the forward market, minus the cost of coal and carbon credits, plus an adjustment for the efficiency of generators. It’s essentially the profit utilities can make on each megawatt hour. Thanks to the rise of European carbon prices in recent years, that number is already deep in negative territory.That’s not quite as bad as it looks for Germany’s coal-burners. They tend to fix their prices years in advance, and still have substantial stockpiles of carbon credits bought years ago for about a fifth of what they cost right now.Thanks to that aggressive hedging activity, RWE reckons it will reliably make between 26 euros and 32 euros ($29.30 and $36.06) a megawatt hour through 2023 on its coal and nuclear generation. With enough carbon credits to hedge its exposure out to 2030, it will still be able to at least break even and potentially make as much as 200 million euros a year even after earnings decline substantially from 2023 to 2025, according to a March presentation. There’s an extra issue that needs to be factored in, though. Germany’s coal retirement plan will reward the generators that switch off early, with compensation payments starting at 165,000 per megawatt in initial auctions this year, declining to about half that amount in 2024. With fuel and power hedges rolling off after 2023, and exposing the utilities to something much more like current dark spreads, generators will find themselves with a fleet of marginally profitable plants worth more as compensation cases than as functioning power stations.The best hope for fossil-fired generators is that Germany’s mistaken decision to shut down nuclear power early, plus ongoing problems in getting permits to build onshore wind, lifts electricity prices enough to put dark spreads back in positive territory for a few more years. In the face of a market that had seen electricity demand stagnate for 15 years even before coronavirus hit, though, that’s a slim hope, and one likely to be rapidly snuffed as electricity imports from the rest of Europe rise.The generation mix is already showing where things are headed. Without any closure plan or compensation payments, coal’s share so far this year has been less than 20%, compared with 43% as recently as 2016. Solar, a technology that was negligible a decade ago, last year contributed more electrons to the grid than black coal. Wind has overtaken brown coal, too.Germany’s generators have spent most of the past few years negotiating with the government about the payouts they’ll receive in return for switching off their coal boilers. While doing that, they’ve got a strong incentive to make thermal power stations look as profitable as possible — but once the payouts have been written into law, there’s little incentive to keep running plants that barely cover their costs. Those stockpiles of carbon credits could even be sold at a profit to businesses with more of an incentive to use them.It’s possible that Germany’s coal generators limp on for a period after 2025, mostly mothballed, available as occasional back-up that can be switched on in winter or on calm cloudy days when other technologies fall short. What matters for the global climate isn’t the technical capacity of grid-connected thermal power stations, though, but the tonnage of coal they burn and the carbon dioxide that emits. It’s not Germany’s retirement plan killing that off. With a price on carbon, renewables are simply out-competing coal on the open market.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.David Fickling is a Bloomberg Opinion columnist covering commodities, as well as industrial and consumer companies. He has been a reporter for Bloomberg News, Dow Jones, the Wall Street Journal, the Financial Times and the Guardian.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Declining cost of wind power generation sets the stage for Utilities to shun coal and adopt wind energy, as well as for corporates to invest heavily in the U.S. wind industry
In this article we will quickly re-cap the broker forecasts for Rwe Ag (ETR:RWE). The Rwe Ag share price has risen by 9.59% over the past month and it’s curren...
RWE finance chief Markus Krebber on Thursday said he was disappointed by the criteria for Norway's decision to pull out of the German utility, adding that he did not expect other investors to make similar decisions. On Wednesday, Norway's $1 trillion wealth fund excluded some of the world's biggest commodities firms from its portfolio for their use and production of coal, including RWE, which is also Europe's third-largest renewable player.
Norway's $1 trillion sovereign wealth fund said on Wednesday it was excluding Glencore , Anglo American, RWE, Sasol and AGL Energy for their use and production of coal under updated ethical guidelines. Another set of companies - BHP , Uniper , Enel and Vistra Energy - were put under observation for possible exclusion at a later stage if they do not address their use or production of coal.
The Rwe Ag (ETR:RWE) share price has risen by 10.3% over the past month and it’s currently trading at 26.89. For investors considering whether to buy, hold or8230;
You can share your thoughts with Thyagaraju Adinarayan (firstname.lastname@example.org), Joice Alves (email@example.com) and Julien Ponthus (firstname.lastname@example.org) in London and Stefano Rebaudo (email@example.com) in Milan. What do the hottest European stocks have in common?
British energy suppliers E.ON UK and Npower, both owned by Germany's E.ON, have furloughed around 4,000 workers amid a government lockdown which prevents staff such as smart meter readers and engineers from carrying out roles. "We have (around) 3,000 colleagues currently on furlough arrangements from our total UK workforce of around 7,500 full-time employees," a spokesman for E.ON UK said in an email. The affected staff include a range of field and metering technicians as well as customer operations and support staff across both residential and business operations, E.ON UK said.
Let's talk about the popular RWE Aktiengesellschaft (ETR:RWE). The company's shares received a lot of attention from a...
The falling cost of producing hydrogen from renewable power offers a promising route to cutting emissions, but governments need to step in and provide $150 billion of subsidies over the next decade to scale up the technology, according to research from Bloomberg New Energy Finance (BNEF). Renewable hydrogen can be made by splitting water into hydrogen and oxygen, using electricity generated by cheap wind and solar power. The technology to do this is currently funded by companies, but BNEF estimates that if governments worldwide were to provide $150 billion in funding over the next 10 years - less than half the amount currently spent on subsidies for fossil fuel consumption - that would help halve the cost of producing hydrogen from renewable energy sources.
A group of gas grid operators, oil and utility firms is planning a 130-kilometre hydrogen pipeline to supply industrial customers in north-west Germany, Open Grid Europe (OGE) said. German companies are keen to convert power from renewables into hydrogen, which emits water when it burns in oxygen rather than the CO2 released by coal, oil and natural gas. Germany is due to adopt a hydrogen strategy soon.
Is RWE Aktiengesellschaft (ETR:RWE) a good dividend stock? How can we tell? Dividend paying companies with growing...
* FTSE 100 down 1.4% dragged down by oil stocks, Centrica Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters. You can share your thoughts with Thyagaraju Adinarayan (firstname.lastname@example.org), Joice Alves (email@example.com), Julien Ponthus (firstname.lastname@example.org) in London and Danilo Masoni (email@example.com) in Milan. The euro has hit a significant milestone this week falling against the dollar to a May 2017 low, with the move inevitably raising the question of what could this mean for European companies' earnings outlook.
* FTSE 100 down 1.5% dragged down by oil stocks, Centrica Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters. You can share your thoughts with Thyagaraju Adinarayan (firstname.lastname@example.org), Joice Alves (email@example.com), Julien Ponthus (firstname.lastname@example.org) in London and Danilo Masoni (email@example.com) in Milan.
The EEX European energy bourse in 2020 will pursue growth in Japanese and U.S. power as part of a push to offer producers risk hedging and international energy operators access to new markets, Chief Executive Peter Reitz said on Tuesday. The 20-year-old EEX, a subsidiary of Deutsche Boerse and continental Europe's leading electricity and natural gas exchange, has started acquiring rivals and offering clearing services across all time zones in recent years. The Japanese clearing service, which opens on May 18, will help power companies involved in wholesaling, generation and distribution with risk management while opening avenues for the EEX network of trading members, access providers, brokers and clearing banks.
* Futures point to lower Wall Street open Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Danilo Masoni. BoE's departing Mark Carney earned his 'unreliable boyfriend' nickname by failing to smoothly guide investors towards his rate decisions. With the market completely split on today's move, Carney was bound, one way of the other, to disappoint.
* Eyes on BoE meeting: rate cut hangs in balance Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Danilo Masoni. Another sign that investors are not quite ready to turn bearish is how value stocks keep on underperforming. "Global value stocks now stand at a record low versus their growth counterparts, having underperformed for the whole of last year and into this year", UBS analysts write in their daily House View.
* Eyes on BoE meeting: rate cut hangs in balance Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Danilo Masoni. Utilities aren't the sexiest industry on the market but over the last month or so they had returns similar to the high-flying FANGs on Wall Street, if not even higher. Surely, worries over economic growth are pushing investors into old-fashioned bond proxies but perhaps there more into it, as climate change fosters huge transformations in the industry and reshapes the whole economy.
* Fevertree falls after Xmas trading update Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Julien Ponthus. This week, eyes will be on the ECB meeting scheduled for Thursday, the first of 2020 and also the first real monetary policy meeting for Christine Lagarde since the previous one in December was effectively her introduction to the world as the new ECB's president. Lagarde is expected to launch the Strategic Review at the Frankfurt meeting, but Royal Bank of Canada is not expecting massive changes.
* Fevertree falls after Xmas trading update Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Julien Ponthus. Once a year, the richest and most powerful people in the world gather together at The World Economic Forum in Davos, Switzerland, to have a chat about the hot topics shaping the world's economy. While the attention on sustainability could be great news for the planet, it might not be that great for European utilities, according to UBS.
European shares ended higher on Thursday after the signing of a long anticipated Phase 1 U.S.-China trade deal lifted some level of near-term uncertainty, while disappointing earnings dragged down London shares. "Investors are maybe not selling on the fact but just pausing for thought that the deal has been signed which is also a source of relief for most people," said Russ Mould, investment director at broker AJ Bell. The pan-European STOXX 600 index closed up 0.2%, with London's main index lagging its continental peers.
Rolf Schmitz has been the CEO of RWE Aktiengesellschaft (ETR:RWE) since 2016. First, this article will compare CEO...
RWE AG <RWEG.DE>, Germany's largest power producer, gave profit forecasts for its renewables business that fell short of some analysts' expectations, casting doubt over whether the booming sector will prove as lucrative as hoped. Fresh off a deal to acquire the renewable units from peer E.ON <EONGn.DE> and former subsidiary Innogy <IGY.DE>, RWE said pro-forma adjusted core earnings from green energy operations would be 1.3 billion-1.5 billion euros ($1.4 billion-$1.7 billion) this year. "The guidance is likely to be seen as 'light'," Goldman Sachs said in a note, adding markets might be disappointed given the businesses had delivered about 900 million euros in first-half core profit before stripping out some activities.
RWE AG, Germany's largest power producer, gave profit forecasts for its renewables business that fell short of some analysts' expectations, casting doubt over whether the booming sector will prove as lucrative as hoped. Fresh off a deal to acquire the renewable units from peer E.ON and former subsidiary Innogy, RWE said pro-forma adjusted core earnings from green energy operations would be 1.3 billion-1.5 billion euros ($1.4 billion-$1.7 billion) this year.