|Bid||26.32 x 410300|
|Ask||26.34 x 177800|
|Day's Range||25.95 - 26.45|
|52 Week Range||17.76 - 28.81|
|Beta (3Y Monthly)||1.30|
|PE Ratio (TTM)||16.10|
|Earnings Date||Nov 14, 2019|
|Forward Dividend & Yield||0.70 (2.67%)|
|1y Target Est||N/A|
The German government will not force hard coal power plants to close over the next seven years, a draft law expected to be approved by the cabinet next week showed on Tuesday. The plan not to force hard coal plant closures before 2026 risks making Germany's coal exit more expensive as the government would have to give operators generous financial incentives to shut down facilities voluntarily. The new plan is a reversal for the government, which had stipulated in a previous blueprint that utilities would be forced to deactivate hard coal power plants by 2026 if not enough closures happen voluntarily.
(Bloomberg Opinion) -- From the Rocky Mountains to the Rhineland and Australia’s Great Dividing Range, the great tide of the coal industry is receding.The entire Powder River Basin, the region spanning the states of Montana and Wyoming that provides about half of America’s thermal coal, is “distressed,” Moody’s Investors Service wrote in a report last week. All companies producing coal there are now focusing on mining coking coal elsewhere in the U.S., the ratings company wrote. Output “will likely fall significantly in 2020,” it said.Energy Information Administration forecasts quoted by Moody’s suggest that production from the Powder River-dominated Western Region will drop to 339 million short tons in 2020 from 418 million short tons in 2018, a 19% reduction and a 42% decline from 592 million short tons in 2010. Most of that decline happened while coal could still produce electricity more cheaply than renewable alternatives, a situation that’s now reversed. A comparable drop over the coming decade would shutter almost every mine in the basin. In Australia, the world’s second-largest coal exporter after Indonesia, similar trends are afoot. The pipeline of new renewables projects, led by solar farms, now stands at 133 gigawatts, according to research group Rystad Energy. Coupled with a flood of energy-storage projects coming online by 2025, that means that coal-fired generation could be extinct by 2040, the group said Tuesday. Changes under way in Europe are pointing in the same direction. Germany, long considered one of the rich world’s last redoubts of coal-fired power, is seeing generation plummet as the rising price of carbon credits and falling cost of gas squeeze out profits for generators. Germany’s current-year and next-year dark spreads, which represent the theoretical profit for coal-fired power based on prevailing fuel, electricity and carbon prices, have been in negative territory for much of the year. Generators RWE AG and Uniper SE are still able to eke out margins by utilizing carbon credits bought in former years when prices were in the region of 5 euros ($5.57) compared to their current 25.93 euros. Eventually, that stockpile will run out. Unless gas gets more expensive or carbon gets cheaper, the German government’s target for ending coal-fired generation by 2038 is likely to come 15 years or so early.Remarkably, this trend is even sweeping up brown coal, or lignite, a cheap-and-dirty variety that’s been seen as more resilient than Germany’s costlier black coal. Lignite generation in the six months through June fell 28% from a year earlier at RWE, a drop of 9.9 terawatt-hours.Even regions that were once viewed as the last hopes for coal demand are looking dicier. The pipeline of thermal power projects beginning construction in Southeast Asia has fallen to zero this year everywhere except in Indonesia. Even there, the capacity starting up is just 1,500 megawatts, equivalent to just five or six power plants, according to a report published Wednesday by Global Energy Monitor, a research group in favor of fossil fuel phase-out.The world has gone through a remarkable energy transition over the past decade, but much of the shift still lies, iceberg-like, beneath the surface. Renewables are cheaper than coal almost everywhere, a prospect that was considered so improbable at the time of the 2006 Stern Review on climate change that it wasn’t treated as a serious possibility beyond a vague hope that research and development might one day flip the script. The great hope for coal now is not that it will be able to survive in the free market, but that government support will come in to bail out an industry that can’t survive on its own, in the process locking in pollution-related disease and climate emissions for future generations.It’s not impossible that this bet will work in a few regions — as exemplified by the speech given last week to China’s National Energy Commission by Li Keqiang, in which the premier sang the praises of domestic coal deposits and stepped back from previous promises to accelerate deployment of renewables.Any industry that harms its consumers, pollutes the planet and depends for its survival on political support is living on borrowed time, though. The declines to coal-fired power on multiple continents are the death throes of a technology that’s rapidly heading towards obsolescence. Humanity will still struggle to reduce our emissions fast enough to avoid devastating climate change — but don’t be surprised if this industry falls even faster than people have dared to hope.(Corrects the eighth paragraph and “End of the Road” chart in column first published Oct. 24 to show that the figure refers only to projects that are starting construction.)To contact the author of this story: David Fickling at email@example.comTo contact the editor responsible for this story: Matthew Brooker at firstname.lastname@example.orgThis 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/opinion©2019 Bloomberg L.P.
(Bloomberg) -- Coal power generators in Europe face 6.6 billion euros ($7.3 billion) of losses this year as plunging renewable energy costs and cheap natural gas cut use of the dirtiest plants to a record low.Almost 80% of lignite and hard coal-fired generators will be unprofitable this year, a hit the industry is unlikely to survive without government help, according to a report from Carbon Tracker. The research group pushing for lower greenhouse gas emissions calls for a continent-wide phaseout of the most polluting fossil fuel by 2030.Utilities in Germany, Spain and the Czech Republic are the most exposed to falling profits in a year where falling coal prices and rising carbon emission permits make it less attractive to burn the fuel for power. Coal’s days are already numbered in Germany, which plans to shut its plants by 2038, and Spain has set a 2030 deadline.While European year-ahead coal prices have dropped to about $66 a ton from more than $100 a year ago, EU carbon permits have surged fivefold since 2017. That has driven up the cost of burning coal. At the same time, benchmark gas contracts in the Netherlands are trading 27% below their 10-year seasonal average, encouraging utilities to use that fuel instead.The report by Carbon Tracker, an environmental group that advises institutional investors, points to how energy economics is prompting nations to wean themselves off coal to curb emissions and slow climate change. For most of this decade it was more profitable to burn coal in Germany, but that relationship was turned on its head this year because of a glut of gas.“EU coal generators are hemorrhaging cash because they cannot compete with cheap renewables and gas and this will only get worse,” said Matt Gray, Carbon Tracker’s head of power and utilities. “Getting off coal is cheap and can be a win-win for consumers and shareholders, providing governments and investors work with local communities.”RWE AG, which owns six coal plants in Germany, could incur losses of close to 1 billion euros in 2019, Carbon Tracker said. In countries such as Poland where wholesale prices are higher and government subsidies are generous, coal plants can remain profitable for the foreseeable future, the analysts said.RWE rejected that analysis. “The figures stated and assumptions made do not stand up to a fact check,” an official at RWE said in an emailed statement. “They are false and cannot be used as a basis for any serious treatment of this topic.”In the first six months of 2019 RWE reported earnings of 99 million euros for its European power generation -- including hard coal, gas, biomass and hydropower -- while for its lignite and nuclear sector it posted 172 million euros of earnings, the spokesman said. The utility doesn’t publish consolidated numbers for coal-fired generation.Hard coal generation has collapsed by 39% in 2019 while lignite has seen a 20% decline year-on-year, according to Carbon Tracker which it calls “eye wateringly low” utilization rates.Bloomberg Philanthropies, which along with Bloomberg LP is owned by Michael Bloomberg, helps fund Carbon Tracker.(Updates with RWE comment in the 8th paragraph.)To contact the reporter on this story: Jeremy Hodges in London at email@example.comTo contact the editors responsible for this story: Reed Landberg at firstname.lastname@example.org, Andrew ReiersonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Germany’s biggest generator of electricity is looking abroad for growth as it closes down coal-fired power plants targeted in the government’s fight against climate change.With many of the nation’s best sites for wind and solar farms taken and a complicated permission system, RWE AG is looking to build renewable-energy assets in the U.S., Britain, Eastern Europe and Asia.The goal indicates the limits RWE has for maneuver in Germany, where utilities are negotiating with Chancellor Angela Merkel’s government over how long they can continue to operate coal plants and what incentives will be in place for alternative energy supplies. The nations must tighten limits on pollution to meet targets it pledged for reducing emissions under the Paris Agreement on global warming.“Our future in Germany won’t be determined by us,” Markus Krebber, chief financial officer at RWE, said in an interview in Frankfurt. “What’s important for us is having a stable, reliable and favorable investment environment, which is determined not only by the company, but moreover by the government.”RWE is supporting Germany’s energy transition, which envisions handing a 65% market share to electricity from green sources by 2030, up from about 44% now. In order to achieve that, Merkel’s administration decided in January to shut down coal plants by 2038.While RWE and its rivals that operate those plants will be compensated, the lack of a firm policies to draw in more investments in renewables leaves the outlook at home uncertain.New RWEThat means new projects abroad. RWE has 1.5 billion euros a year to invest in green energy, backed by its own cash flow, and may be able to boost that sum to 3 billion euros, Krebber said. That firepower could be complemented with a sale of RWE’s approximate 15% stake in EON SE. RWE, he said, wants to recycle cash from the EON stake into other investments.See: Merkel Flip-Flops on Solar, Wind Targets in Climate-Action PlanThose goals follow a shakeup in Germany’s utility landscape, with RWE and EON carving up Innogy SE to follow different focuses. EON will concentrate on grid services, and RWE on power generation. That deal also gives RWE a position in renewables for the first time, enabling it to leave its position as Europe’s biggest emitter of carbon dioxide.The company’s newest renewables subsidiary is set to become the third-largest clean energy company in Europe, with a portfolio of more than 9 gigawatts with power generation capacity. Most of that will come from wind farms.Even so, RWE has fierce competitors in green energy and will retain responsibilities for its coal mining and power plants for years to come, according to AlphaValue, an energy consultancy based in Paris.“The picture is far less green compliant when it comes to its worldwide relative weight of renewables,” AlphaValue said in a report. “RWE remains the European utility most exposed to de facto outlawed coal and lignite.”RWE is developing a pipeline of more than 5 gigawatts of offshore wind and 3 gigawatts of onshore wind.While the U.K. and Asia offer initially good potential for offshore wind investments, Krebber said, the company sees competitive advantages in the U.S. and also in onshore wind, solar energy and battery storage.“There is no interest in buying existing assets, that is for investors with a lower cost of capital,” the executive said, adding that RWE will join with infrastructure funds to help fund developments. “We are out there looking, especially in the new markets, to acquire developers, platforms, pipelines and then constructing and operating plants ourselves.”To contact the reporters on this story: Vanessa Dezem in Frankfurt at email@example.com;William Wilkes in Frankfurt at firstname.lastname@example.org;Brian Parkin in Berlin at email@example.comTo contact the editors responsible for this story: Reed Landberg at firstname.lastname@example.org, Andrew ReiersonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Evidence of the increasing effects of climate change is building, as are the investing opportunities and changes in consumer habits linked to environmental concerns and resource use. RWE AG (XE:RWE) , Europe’s biggest carbon-dioxide emitter and a repeat target of activists, claims it can become climate neutral by 2040. To do so, the German utility, which has already divested in part in favor of renewable energy, will shutter its remaining coal-fired power plants.
German utility RWE has a renewable project pipeline of more than 18 gigawatts (GW), mostly in the United States, it said on Monday, confirming it could pour up to 3 billion euros ($3.3 billion) into green energy sources a year. RWE has transformed itself by taking over the renewables activities of subsidiary Innogy and peer E.ON , which was part of a major reshuffle of Germany's power sector. The move has turned RWE into Europe's third-largest renewables group after Spain's Iberdrola and Italy's Enel.
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Climate protection measures that Chancellor Angela Merkel's conservatives and their Social Democrat coalition partners want to unveil next week will cost at least 40 billion euros until 2023, a person briefed on the talks told Reuters on Saturday. The government wants to unveil its climate protection package on Sept. 20 and Merkel has said the plans would include some sort of carbon emissions pricing to finance measures aimed at reducing emissions. The coalition partners, which include Merkel's Christian Democrats (CDU), their Bavaria Christian Social Union (CSU) sister party and the centre-left Social Democrats (SPD) are divided on how to finance Germany's march toward a green future.
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Swedish teenage climate activist Greta Thunberg, on a visit to a German anti-coal protest camp, questioned whether the country should continue to use the fuel to generate power for another 20 years as the government plans. Thunberg, the most visible spokeswoman of the Fridays for Future movement of students striking to demand climate action, was talking to reporters at the western German Hambach forest near Cologne. The area has become a symbol of protest against the coal industry, prompting utility RWE to give assurances it would not touch the forest until late 2020, although it had hoped to clear it for brown coal mining and burning activities.
Moody's Investors Service (Moody's) has today changed to negative from stable the outlook on the A3 issuer rating of Amprion GmbH (Amprion). Concurrently, Moody's has affirmed this rating. The outlook change to negative from stable reflects Moody's expectation that Amprion's key credit metrics could fall below the rating agency's guidance for the existing A3 rating.