RWE Drops Biomass Power, Adds Biomass Thermal, Wind
- by Anna Simet, March 12, 2015, Biomass Magazine
[[{"type":"media","view_mode":"media_large","fid":"422","attributes":{"alt":"","class":"media-image","style":"width: 255px; height: 171px; margin: 3px 10px; float: left;"}}]]While RWE Group reported it achieved its earnings targets for 2014 and EBITDA was significantly better than planned, low electricity prices and unusually mild weather negatively affected business performance, which dropped 25 percent from 2013 to 2014.
Peter Terium, CEO of RWE, said that currently, 35 to 45 percent of the utility’s conventional power stations are no longer making any money under current market conditions. “I am not talking about book values—these power stations are costing us real money,” he said. “We cannot avoid the sobering fact that conventional power generation is hardly viable any longer under current market conditions.”
He added that recent modernizations of RWE’s portfolio of power stations haven’t paid off, and that it is difficult to keep a gas or hard coal-fired power station commercially feasible. Previous Investments have made RWE the third-largest gas-fired power station operator in Europe, with capacity of around 15,000 megawatts across the continent. “Considering how quickly the electricity wholesale price fell in recent years, it would be impossible to cut a power station’s costs at the same rate to maintain margins or even make any profit at all,” he said.