CEZ thermal output up 3.2%, hedging rates slightly down y/y

Published 17:29 on November 10, 2015  /  Last updated at 17:29 on November 10, 2015  /  EMEA, EU ETS  /  No Comments

Czech-based utility CEZ produced 3.2% more thermal power over the first nine months of 2015, though its hedging rates were slightly down year-on-year despite a recent uptick.

Czech-based utility CEZ produced 3.2% more thermal power over the first nine months of 2015, though its hedging rates were slightly down year-on-year despite a recent uptick.

CEZ’s thermal units – the vast majority of which are carbon-intensive coal and lignite – produced 21.5 TWh of power between Jan.-Sep. 2015, up from 20.8 TWh a year earlier, its Q3 financial results said on Tuesday.

This helped boost the company’s overall power sales 9% y/y, despite unscheduled and extended outages at two of its nuclear plants and the postponed completion of its new coal-fired unit at Ledvice.

CEZ has hedged 85% (Y+1), 56% (Y+2) and 26% (Y+3) of its power output up to Oct. 31, slightly down on the respective 85%, 62% and 26% reported a year ago.

However, all three years’ hedging rates ticked higher in percentage terms compared to Q2. The company also hedged more of its expected Y+1 generation over the past quarter than for any of the previous four quarters, according to Carbon Pulse calculations.

Over the three months to Oct. 31, benchmark front-year EUAs rose 8.8% to €8.64, partially due to increased buying from utilities, the main allowance buyers.

Utility hedging rates are closely monitored by participants in the EU ETS because the data can provide a window into existing and future EUA demand from the bloc’s biggest allowance buyers.

Of big-emitting utilities that report hedging, E.ON will announce Q3 results on Wednesday, Enel and RWE on Thursday, and ENBW on Friday.

Vattenfall last week reported increases in fossil fuel-based generation and CO2 levels in Q3 compared to last year, but its year-on-year forward hedging rates remained down.

And on Monday, Polish utility PGE reported generation of 41.73TWh in the first nine months of 2015, a 3% y/y increase. Over 95% of PGE’s output is carbon-intensive coal or lignite.

By Ben Garside – ben@carbon-pulse.com

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