The energy thread

[Jimbuna]

EDF's UK profits soar after electricity price hikes

French energy giant EDF's UK arm returned to profit in 2022, boosted by it being able to sell the electricity it generated for a higher price.

Underlying profit was £1.12bn, compared with a loss of £21m in 2021 mainly down to improved performance from its nuclear electricity generators.

But its UK consumer energy supplier lost more than £200m in the year.

EDF blamed the cost of buying energy for customers which was higher than the prices set under the energy price cap.

The Energy Price Guarantee caps the average household cost of electricity and gas at £2,500 annually.

EDF, which supplies gas and electricity to about five million UK households, is 84%-owned by the French state, but will soon be fully nationalised.

It operates five nuclear power stations in the UK as well as having a large number of wind farms.

Unlike generators who rely on gas to produce power, it benefited from higher electricity prices on wholesale markets in 2022 which brought it a big increase in revenues without an equivalent rise in costs.

Due to competition rules, companies cannot sell their own energy at a discount to their own customers.

The company said it invested more than £2.6bn in 2022 in its UK nuclear, renewables and customer businesses.

It said it planned to invest a further £13bn in the UK in the next three years, largely at Hinkley Point C, the new nuclear power station being built in Somerset that is due to open in 2027.

Some £2bn will be invested in its existing UK nuclear fleet and renewables projects.

The EDF Group posted an underlying loss for 2022 of €4.99bn (£4.44bn) blaming "the decline in nuclear output" and "the impact of the exceptional regulatory measures to limit price increases for consumers in 2022".

The latter refers to a cap on consumer prices imposed by the French government meaning EDF ended up selling the electricity at a lower price than it paid for it.

That cost the group €8.2bn (£7.3bn) in the year, it said, which effectively wiped out the €8.7bn (£7.8bn) it made from "market price rises passed on to customers".

The record loss of almost €5bn comes as the company gets close to becoming fully owned by the French government, with the takeover expected to be completed in May.

The figure prompted the firm's chairman and chief executive Luc Rémont, appointed in November, to focus on future prospects rather than past problems.

"Our priority right now is improving EDF's financial position, and I am confident that the benefits of the actions taken will begin to show in 2023," he said.
https://www.bbc.co.uk/news/business-64647854

[Skybird]

EDF: French energy giant posts worst-ever results. Energy prices may have jumped to unprecedented highs, but for France's state-controlled power company EDF 2022 was a miserable year with record annual losses of €17.9bn (£16bn).A price cap on energy for French consumers hit EDF profits hard but so did the enforced closure of many of its of nuclear power stations for repairs.The losses are the third biggest in French corporate history and the worst for more than 20 years.EDF's debts have spiralled to €64.5bn.

On an underlying basis, EDF's losses came in at €4.99bn. The figure was in marked contrast to EDF's UK-based business, which made an underlying profit of £1.12bn (€1.26bn) supplying electricity and gas to five million households.

https://www.bbc.com/news/world-europe-64674131


They can cleverly juggle numbers and can play hide and seek with fiscal numbers as muchg as they want - at the end of the day, stuff costs money, there aint no such thing as a free lunch, and no aid package ever came for free. States give no presents: they steal the people's money and then redistribute it according to populistic interest of party fat cats.

[Jimbuna]

EDF is my energy supplier but only because they were offering the cheapest deal a few years ago.

[Jimbuna]

In February, Gazprom increased gas supply through Ukrainian gas pipelines by 72%

In February 2023, the supply of Russian gas through Ukraine increased by 72% compared to the figures at the end of January. At the same time, one of the two entry points to the GTS of Ukraine is still used for resource transit.

As Censor.NET informs, this was reported by the Russian publication "Interfax".

Russia's Gazprom on Wednesday, February 22, increased the transit of "blue fuel" through the gas transport system of Ukraine to European countries, updating the maximum since the beginning of January 2023.

Thus, Ukraine accepted an application from the Russian side for gas transit for Wednesday in the amount of 42.2 million cubic meters. The day before, the volumes amounted to 40.3 million cubic meters, the day before that - 39.2 million cubic meters. As a result, in February, the supply of Russian gas through Ukraine increased by 72% compared to the end of January. Thus, the Russian gas monopolist is restoring the figures for 2022, which were fixed back in March.

It is also noted that the volumes of gas transit have even approached the technical maximum of pumping. However, for the transportation of "blue fuel", as before, only one of the two entry points to the GTS of Ukraine is used — the Suja station, through which Russia supplies gas to China.

"Gazprom is supplying Russian gas for transit through the territory of Ukraine in the amount confirmed by the Ukrainian side through the Suja hydroelectric power plant - 42.1 million cubic meters as of February 22. The application for the Sokhranivka GTS was rejected," the publication said.

At the same time, according to the current contract between Naftogaz and Gazprom, the "pump or pay" formula operates, according to which the Russian company must pump 40 billion cubic meters of gas per year, or approximately 109 million cubic meters per day, through Ukraine's GTS. Source: https://censor.net/en/n3401509

[Jimbuna]

Drax: Subsidies for power giant questioned as annual profits soar

Soaring earnings sparked questions about the value for money of government subsidies for Drax, which provides 7% of British electricity and receives around £800m in subsidies a year.

A British company that burns wood to create electricity is the latest power giant to post soaring annual profits amid the energy crisis of 2022.

Gas prices reached record highs last year as Russia squeezed supplies to Europe in response to sanctions for its invasion of Ukraine, accelerating the shift away from fossil fuels and driving demand for renewables.

But as earnings soared for Drax Group, which provides 7% of Britain's electricity, critics questioned whether it should continue to receive around £2.4m a day in public subsidies.

The company, which provides renewable power from biomass, hydro and pumped storage, posted annual adjusted core profit of £731m for 2022, up 83% from £398m in 2021.

Drax "played a significant role in ensuring security of supply during a challenging year for the UK's energy system," said CEO Will Gardiner.

During periods of peak demand and low wind and solar power supply, its renewable stations collectively supplied up to 70% of the UK's renewable power in certain periods.

On Thursday Drax increased its total dividend by 11.7% to 21 pence per share. It added its net debt rose from £1.1 to £1.2 billion pounds in 2022.

Drax burns wood pellets to generate electricity that the UK classes as renewable because new trees are planted to soak up the carbon dioxide released by the burned pellets.

Some scientists back bioenergy as a credible way to mitigate climate change, while others argue it's impossible to guarantee the emissions are reabsorbed, or negate the other pollution.

Drax's bioenergy operations makes it eligible for government subsidies, receiving £893m in 2021, according to energy think tank Ember.

"These results show that Drax would not be profitable without public support," said Phil MacDonald, chief operating officer at Ember.

"The scale of these subsidies just don't add up," he said, urging the government to reconsider the funding.

Conservative MP Sally-Ann Hart said: "Burning imported wood pellets for electricity is not cheap for billpayers. Given the growing environmental concerns, ministers shouldn't commit to new subsidies for this energy source."

The government is working on a delayed Biomass Strategy, due to be published in the second quarter of 2023.
https://news.sky.com/story/drax-subs...-soar-12817690

[Skybird]

Frankfurter Allgemeine:
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France says "no thanks" to German energy transition

The French government under President Emmanuel Macron has embarked on an open confrontation course with the German government on the issue of nuclear energy. In the background, deepened nuclear cooperation with the United States is also playing a role. Macron sees himself vindicated by Biden's climate agenda, which also envisions the expansion of nuclear power. Macron had already presented an Agenda 2030 for the "renaissance of nuclear power" with the simultaneous expansion of renewables before the cessation of Russian gas supplies to Europe, in October 2021.

During the Frenchman's state visit to Washington last December, a permanent bilateral working group on civil nuclear power was established. The explicit goal is "to promote state-of-the-art nuclear energy worldwide, given its important role in reducing global CO2 emissions," according to the joint statement. Washington and Paris are jointly seeking ways to reduce dependence on Russia's Rosatom, particularly for fuel enrichment. In terms of uranium supply, both countries already have alternatives. France also sees itself in line with the International Energy Agency (IEA). Its president, Fatih Birol, has identified a "global comeback of nuclear energy."

The French government feels supported by a renewed domestic consensus in Brussels in its brash approach, for example in the dispute over the recognition of nuclear-generated hydrogen. A parliamentary commission of inquiry chaired by the conservative Republicans (LR) has been investigating "the reasons for France's loss of sovereignty and independence in the energy sector" since last November. The hearings, which are taking place in the National Assembly, come close to a reckoning with a failed European energy policy under German leadership.

On March 16, the two former presidents Nicolas Sarkozy and Francois Hollande will be heard. Already testifying have been their appointed heads of Electricité de France (EDF), the energy company that operates the 56 nuclear reactors. On December 13, former EDF CEO (2009-2014) Henri Proglio was questioned for two hours. EDF, he said, had been an energy exporter with the cheapest electricity in Europe (two and a half times cheaper than in Germany), which gave France an advantage in greenhouse gas emissions. But then the European electricity market was developed in such a way that the market price was linked to the gas price, Proglio criticized. The whole approach was "German," he said. "European regulation is German," he said. The climate balance had played a secondary role, he said. At a dinner on the sidelines of the 2012 Hannover Messe, then-Chancellor Angela Merkel reportedly confided in the EDF chief that as a physicist she could not endorse the nuclear phase-out. She had decided to do so for political reasons, she said.

According to Proglio, changing German governments had deliberately tried to weaken EDF, a French competitive tool, in order to favor German industry. "They succeeded," he concluded. Proglio is controversial in France. But his criticism of Germany has been unfolding for weeks, showing how negative the perception of the energy transition has become. Proglio's predecessors and successors have made similar, if more diplomatic, statements before the investigative committee. Long known as "Atomic Anne," manager Anne Lauvergeon, who headed the Areva Group between 1999 and 2011, described a public debate that had been all about the "German model."

Nuclear phase-out finds fewer and fewer supporters

Germany had been developed into Russia's main gas hub, while nuclear energy had been stigmatized as no longer in keeping with the times. France had joined in, announcing in 2012 that it wanted to reduce the share of nuclear power to 50 percent. Former Prime Minister Manuel Valls confirmed to the committee that the "50 percent" mark had been a political symbol, not based on any feasibility studies. The figure had been the Greens' condition for an electoral pact with the Socialists. The commission of inquiry testifies to the strengthened French will to emancipate itself from German requirements. The commission is headed by LR deputy Raphael Schellenberger, who believes the shutdown of the reactors at Fessenheim under German pressure was a cardinal mistake. The final report is expected in April.

The idea of phasing out nuclear power is receiving less and less support even in the left-wing party spectrum. Olivier Faure, the Socialist party leader who has just been confirmed in office, wants a referendum on nuclear power. He has not adopted the demand of failed Socialist presidential candidate Anne Hidalgo (1.75 percent of the vote) to phase out nuclear power as soon as possible. Communist presidential candidate Fabien Roussel (2.3 percent of the vote) is pursuing a clearly pronuclear course. Republicans and Rassemblement National also support the construction of new nuclear power plants in the name of national sovereignty. This changed political context explains why the government in Paris is willing to use any means of pressure to assert itself against the anti-nuclear course of the federal government.
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Everything and everyone that helps to brign down the German energy-polticla amdness has my support for this task, leftor right, round or squared, big or small. The Germans must be stopped on this topic. The germans know only sun and wind now, and they only know "electric". There are several other options that are more reliable, from nuclear to geothermal energy. Suin and wind are not capoable tom provide rleiable base supply, and too inpredictable, and demand way too much surrounding preparatory and mainteannce measurements. Imposted two topics separately that showed that none oif them are truly "renewable". Not if you look beyind the final power prouction, but also at ecological building costs, maitetance costs, rebuilding industrial infrastructure that enables the use of these, and business-political dependencies from China - like Germany did with gas from Russia. The germans are completely out fo their mind. Nuts. Hopelessly so. They can only be dealt with on basis of a thinking in terms of "lets contain them".

[Jimbuna]

Ofgem sets new price cap prompting calls for energy bill help

By Kevin Peachey
Cost of living correspondent

The amount suppliers can charge households for energy has been cut by regulator Ofgem but bills will still rise in April as government help eases.

Ofgem's announcement does not directly affect what customers pay for each unit of gas and electricity but it reduces the costs faced by government.

The typical household bill will rise to £3,000 a year in April.

Campaigners say ministers should stop the increase because Ofgem's new cap reduces the cost of support.

The typical annual household bill is set to rise from £2,100 to £3,000 in April because government help - known as the Energy Price Guarantee (EPG) - will become less generous and a £400 winter discount on all bills ends.

The government currently compensates energy suppliers with the difference between the guarantee and Ofgem's cap.

The energy price cap was £4,279 in January but on Monday, Ofgem announced that the cap would drop to £3,280 in April because of falling wholesale prices.

TUC general secretary Paul Nowak said: "Energy bills are out of control. The government must cancel April's hike. With the cost of wholesale gas plummeting ministers have no excuse for not stepping in."

Chancellor Jeremy Hunt previously told the BBC that although the policy remained under review, he did not think the government had the "headroom to make a major new initiative to help people". Ministers also point out wider support, such as rising benefit payments in April, will help people.

Under the government guarantee, a household using a typical amount of gas and electricity in England, Wales and Scotland is currently paying £2,500 a year for energy.

Without state support, that annual bill would have been £4,279 since January.

The chancellor has already announced that the EPG will become less generous in April, which means the typical household will be paying £3,000 a year.

Ofgem has now announced what that bill would otherwise have been £3,280 from April to July, without the guarantee.

Ofgem's chief executive, Jonathan Brearley, said that April's rise in bills was "deeply concerning" for many people, but there was some hope ahead.

"Today's announcement reflects the fundamental shift in the cost of wholesale energy for the first time since the gas crisis began, and while it won't make an immediate difference to consumers, it's a sign that some of the immense pressure we've seen in the energy markets over the last 18 months may be starting to ease," he said.
https://www.bbc.co.uk/news/business-64748135

[Jimbuna]

[Skybird]

You just can't please her, no matter what you do. Saint Greta protests against wind turbines being erected on Sámi land in Norway as well.


If solar panels and solar storage were sufficient to generate and store enough electricity, then she would also protest against solar energy. Because what would she do all day long if there was nothing left to demonize? Truning irrelevant? Unthinkable?


This is not emant to express that she is relevant, or ever were.

[Skybird]

A set of interactive maps showing pipelines and net exports and imports regarding oil and gas. The site is in German, but the maps should be usable and understandable nevertheless.



https://interaktiv.tagesspiegel.de/l...ieversorgungs/

[Dargo]

The impact on Russian industrial production and government oil revenues.

[Jimbuna]

Spain, Netherlands back quick deal on EU power market reform

STOCKHOLM, Feb 27 (Reuters) - Spain and the Netherlands have backed a rapid deal on an upcoming revamp of Europe's electricity market, as countries seek to reduce power costs and help their industries compete in global markets.

European Union countries' energy ministers are meeting in Stockholm on Monday to debate the upcoming plans, which aim to tweak the market to stop short-term swings in fossil fuel prices from wreaking havoc on European consumers' energy bills.

However, the plans have already stirred disagreement among EU countries on how far to reform the market - with Spain among those calling for substantial changes to align the system with Europe's shift to green energy, and the Netherlands in the camp of countries wary that major upheaval could deter much-needed investment in the energy sector.

"Timing is key. And sometimes, not being in time is a disaster," Spain's Energy Minister Teresa Ribera told Reuters on the sidelines of the EU meeting, adding reforms should be agreed before European Parliament elections in mid-2024.

Ribera said the reform could form part of Europe's response to the United States' huge Inflation Reduction Act package of subsidies for green industries.

"For the time being, the single element that makes the highest difference in terms of competitiveness between the US and Europe is the cost of energy," she said.

Negotiations on major EU legislation, which require approval from EU countries and the EU Parliament, can take two years - sometimes, more. The European Commission will propose the reforms next month.

The Netherlands, although wary on the depth of reform, agrees on the need for speed.

"I'm very much in favour of a strong and fast process to make sure that this reform is delivered this year," Dutch energy minister Rob Jetten told Reuters.

In the EU's current electricity market, gas plants often set the overall power price. Soaring gas prices last year pushed up European power prices to record highs.

Spain and France want the reforms to help countries sign more long-term fixed-price contracts with low-carbon power plants, creating a more stable price that would feed into consumer bills.

Jetten said countries agree on the overall aim to shift to a low-carbon power sector but he warned against rules that would force states to structure their power markets in the same way, for example by obliging them to impose fixed-price "contracts for difference" schemes on power plants.
https://www.reuters.com/business/ene...rm-2023-02-27/

[Jimbuna]

Energy Price Guarantee expected to continue at same level in April

The chancellor is expected to extend the Energy Price Guarantee at current levels for a further three months, the BBC understands.

Typical household energy bills were scheduled to rise to £3,000 a year from April, but calls have been made for the government to retain its current level of support so they stay at £2,500.

The level of help is now expected to be maintained, but energy firms have been asked to prepare for both scenarios.

The Treasury declined to comment.

At the moment, the government is limiting the typical household bill to £2,500 a year, plus a £400 winter discount.

From 1 April the help is scheduled to be scaled back, and the £400 discount will come to an end, which could push people's bills up despite the weather getting warmer.

Fuel poverty campaigners have said the number of households struggling to afford bills could rise from 6.7 million to 8.4 million as a result of the April rise.

However, industry sources told the BBC that some energy companies have already started amending future bills to reflect that energy help will continue at or very near to current levels beyond 1 April.

Chancellor Jeremy Hunt to date has declined to extend the support at the current rate, but experts have suggested it is increasingly likely he will change course, probably at the Budget on 15 March.

Mr Hunt told the BBC last month that the policy was "under review".

The Treasury was understood to be concerned that an open-ended commitment would leave British public finances significantly exposed to any further unexpected rise in global gas prices.

Instead the decrease in support will kick in in the summer, when it will not be needed, because the separate energy price cap is already anticipated to be lower as a result of declining market gas prices.

However, the £400 winter payment that has led to a £66 per month reduction in monthly payments on many bills does look likely to end next month.

There have been no talks about extending this element of support.

The Resolution Foundation think tank, which aims to improve living standards for people on low to middle incomes, and consumer rights champion Martin Lewis have both called on Mr Hunt to cancel the bills rise, as have opposition parties.

Labour's shadow chancellor Rachel Reeves said: "Families are really worried about prices soaring in April and so it's urgent the government gives them reassurance now, and extends the windfall tax on oil and gas giants to give them support for their energy bills as Labour would."

The Institute for Fiscal Studies (IFS), an economics research institute, has forecast that the Treasury could afford to keep support at current levels until the summer due to wholesale energy prices falling sharply, meaning the cost of the scheme had been cut.

Energy UK, which represents suppliers, urged the government earlier this week to hold the level of support at £2,500 for a typical household and to "announce that quickly" so firms could price it into bills from April.

Energy Secretary Grant Shapps previously said he is "very sympathetic" to suggestions that the planned £500 rise in bills should be stopped.

However, there is an alternative view that money would be better spent by the government by targeting support for those on the lowest incomes - as is the case for cost-of-living payments - and in the winter.

"Vulnerable groups could benefit substantially from this extra funding if it was used in a more targeted way. And should those groups take precedence over universal payments to multiple homeowners and billionaires?" said Joe Malinowski, founder of comparison site Energyscanner.

There has been a drop in wholesale gas and electricity prices in recent weeks that has raised hopes that the worst of the energy crisis could be easing.

Bills began rising as Covid lockdowns ended but the war in Ukraine saw them surge further.

Without the government's Energy Price Guarantee to limit prices, a typical household's gas and electricity bill would have hit £4,279 a year from January under the energy price cap set by Ofgem, the industry regulator.
https://www.bbc.co.uk/news/business-64830701

[Skybird]

Plain reason. What cannot work, will not work. Laws of physics and nature cannot be altered by a legal amendement.



"It looks as if its structurally not possible to make the energy transition in the way imagined."

[Jimbuna]

European gas storage levels at record highs - and it suggests good news for supplies

Record gas storage levels this year are unlikely to mean prices drop to levels seen before the pandemic and the Ukraine war, but energy security has improved after months when the UK worried about keeping the lights on.

Energy costs could come down as European gas storage facilities are expected to end the winter season at a record of more than 50% full.

Modelling done by energy consultancy Cornwall Insight suggests gas supplies are secure after concerns of shortages following Russia's invasion of Ukraine.

Fuller storage units mean less future demand for gas, which can bring down prices.

Storage facilities across Europe will end winter between 45% and 61% full - an average of 55% capacity - bypassing the previous end of winter record of 54% in 2020.

Following the start of the conflict in Ukraine, European countries raced to reduce their reliance on Russian gas, which pushed up prices and led to concerns about energy supplies in winter 2022 to 2023.

Having a greater amount of gas in storage means more is ready for winter 2023-2024 and less needs to be bought, leaving supplies more secure than in 2022.

It is a doubling from last year.

On 31 March 2022 just 26% of European storage facilities were filled, according to data from Gas Infrastructure Europe.

There was concern that the lights could not be kept on amid gas shortages. In the UK the National Grid's Electricity System Operator had warned in October that planned three-hour power blackouts could be imposed in the event of gas supplies falling short of demand.

To reduce energy demand and cope with potential shortages, EU countries formally agreed a voluntary 10% cut in gross electricity consumption and a mandatory reduction of 5% during peak use hours.

But high gas storage levels this year do not mean prices will drop to lows seen at the end of previous high storage-level winters.

Despite the "considerably more positive" forecasts, the lead research analyst at Cornwall Insight said he was cautious about saying Europe is over the worst of the energy crisis.

"Any single factor can influence the pace and pattern of storage refill, and perhaps more pertinently, change the cost paid to achieve it," Dr Matthew Chadwick said.

"We are certainly not out of the woods yet."

Factors that could bring up energy costs include weather, US exports, Chinese demand and Russian supplies.

While a mild winter helped preserve gas stocks, a summer with heatwaves would bring energy demand for air-conditioning and fans.

Imports of US liquified natural gas in the second half of last year rose significantly as reliance on Russian gas waned. Going forward, however, the US is under domestic pressure to protect consumers from price rises, which could mean less exported to Europe.

Russian gas is still relied on by Europe and will continue to be needed.

The reopening of China, following nearly three years of lockdown restrictions, and the associated economic growth will impact energy markets, the Cornwall Insight report said, though the impact is uncertain.

For those looking to hear good news about bills, Dr Chadwick is not the barer.

"Whatever the outlook for storage levels, the need to compensate for Russian pipeline volumes with expensive and volatile liquified natural gas will keep gas bills higher," he said.

"This, at least for now, is the "new normal", and consumers and economies should prepare for energy costs to remain higher than before the pandemic, and the Ukraine war, for some time to come."

Households can expect prices to be "more muted" than last year, Dr Chadwick said, as the panic from the Ukraine war outbreak subsides.

"What may ease this year is the heightened level of understandable panic that led to hectic energy-buying practices during the autumn of 2022.

"As a result, we can probably expect prices to be much more muted than 2022, despite any uncertainties that may come into play."

Gas storage facilities in the UK include Rough, a facility reopened this year off the Yorkshire coast, and the Stublach onshore facility in Cheshire.
https://news.sky.com/story/energy-cr...plies-12827479