EMEA > Enel hedging lags as H1 thermal output rises 16%

Enel hedging lags as H1 thermal output rises 16%

Published 13:49 on July 30, 2015  /  Last updated at 14:39 on August 2, 2015  / Ben Garside /  EMEA, EU ETS

Italian utility Enel advanced its hedging over the quarter but forward power selling rates still lag the previous year’s levels, the company said in its first-half results on Thursday.
  • Enel and ENBW hedging rates still lag 2014 levels
  • Enel’s H1 thermal power output up 16% y/y
  • Other big utilities due to report Aug 12, 13

Italian utility Enel advanced its hedging over the quarter but forward power selling rates still lag the previous year’s levels, the company said in its first-half results on Thursday.

Enel said it had hedged 50% and 25% of its expected Y+1 output in Italy and Spain respectively, advancing steadily from the 36% and 7% three months earlier.

But this still left the company’s hedging rates lagging those of a year ago, by which time Enel had hedged 60% and 35% of its expected Y+1 output in Italy and Spain.

The company didn’t give a breakdown of its sales by region but said its global power sales fell 2% to 127 TWh, with most of the decrease due to a sales decline in its EU operations in Italy and Spain.

Enel’s H1 total power output for its Italian and Spanish operations rose 2.6% y/y to 72.2 TWh, up from 70.4 TWh.

Yet, its ETS-regulated thermal output surged 16% y/y to 35.3 TWh, up from 30.4 TWh, indicating the company’s 2015 EUA demand will be far higher than a year earlier.

ENBW hedging lags as thermal output falls 6.5%

German utility ENBW has barely increased forward hedging over the previous quarter, leaving its hedging levels still well below its levels a year earlier as weak power prices and thinner margins weighed, it said in first-half results on Thursday.

ENBW said it had hedged 75-90% and 25-45% of its expected Y+1 and Y+2 power output by the end of June, barely up from 70-90% and 25-40% three months earlier.

This leaves the company’s forward hedging levels lagging on a year earlier, by which time ENBW had already sold 95-100% and 50-75% of its Y+1 and Y+2 power output.

ENBW’s H1 power sales fell 0.4% or 0.1 TWh y/y to 23.9 TWh, down from 24 TWh.

ENBW’s overall H1 power generation fell 2.7% to 25 TWh, with drops in all types of output but thermal generation particularly hard hit.

H1 output from ENBW’s ETS-regulated coal and lignite-burning plants fell 6.5% y/y to 10.1 TWh, lowering the company’s demand for carbon allowances.

Vattenfall, Europe’s second biggest emitter, last week reported it had sold less thermal power forward and hedged a smaller proportion of it in H1.

Of Europe’s other major power sector emitters, EON’s is due to report H1 numbers on Aug. 12, RWE on Aug. 13.

By Ben Garside – ben@carbon-pulse.com