Dusseldorf, Stuttgart Russia’s attack on Ukraine is causing terrible suffering to millions – in response, Western nations and corporations are severing most economic ties. This triggers a profound change in the German energy landscape – at the same time as the upheaval that is already underway. “Now security of supply is more important. Nevertheless, we have to keep an eye on climate protection,” said EnBW boss Frank Mastiaux on Wednesday at the presentation of the business figures for the past year in Stuttgart.
For the Baden-Württemberg company, as for Eon, RWE and Uniper, the war represents a difficult tightrope walk: Due to rising energy prices, the energy companies are making high profits, but at the same time the consequences of the Ukraine war mean high organizational costs.
Last year, EnBW increased the consolidated operating result for the fifth time in a row, climbing by 6.4 percent to 2.96 billion euros. The area of thermal generation and trading made a particular contribution to this: here the adjusted Ebitda rose by 67.6 percent compared to the previous year. The shareholders are to receive a dividend of EUR 1.10 per paper – ten cents more than for 2020. In the current year, the company wants to make an operating profit of more than three billion euros for the first time.
EnBW purchased 495 terawatt hours (TWh) of gas and 4.2 million tonnes of hard coal last year. Around 20 percent of the gas comes from Russia, and over 85 percent of the hard coal. Mastiaux emphasized that many of the long-term contracts were already reduced at the beginning of the year. “There will be no new supply contracts with Russia under this leadership,” he clarifies. Now EnBW is looking for new sources of supply.
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While the conversion is being pushed ahead with a view to hard coal deliveries and is also feasible in the short term, “a full replacement gas procurement is not possible, not even for us.” But here, too, they are looking for new supply partners for more imports of liquefied natural gas.
Rising prices for consumers
However, Mastiaux prepared consumers for rising prices: “It can be assumed that prices will rise for everyone in the near future.” The wholesale prices for gas, electricity and coal have undoubtedly increased significantly.
The wholesale gas price has temporarily risen to over 300 euros and is currently at 93 euros four times as high as in March 2021. The electricity price on the spot market of the European Energy Exchange (EEX) climbed from a good 50 euros per megawatt hour to 431 euros in the meantime and is listed currently at 236 euros. Due to the massive price jumps, the EnBW subsidiary VNG requested a billion-euro loan from the state bank KfW just a few weeks ago. The company made it clear on Wednesday that this is not currently needed. But we are in talks.
In the future, EnBW intends to continue concentrating on the expansion of renewable energies and the power grid infrastructure. Mastiaux is convinced that this is the only way to get out of dependence on Russia. “In Germany, we now have to speed up the transition to a long-term CO2-free energy supply.” This applies to investments in renewable energies and a hydrogen economy as well as to the necessary infrastructure, be it electricity and gas networks or electromobility.
However, the group wants to focus more on Europe again, especially with offshore wind turbines. EnBW recently invested in new projects in the USA and Taiwan. The company has already sold all activities in the USA to the French oil company Total. You can also look at the commitment in Taiwan.
For the long-standing EnBW boss Frank Mastiaux, this was the last balance sheet. After it became known that his contract expired in the autumn, Mastiaux had already announced that he would not seek another term. He doesn’t have a successor yet.
Mastiaux switched from Eon to EnBW in 2012. The year before, the reactor catastrophe in Fukushima had triggered the nuclear phase-out in Germany. Until then, EnBW had mainly generated electricity in coal and nuclear power plants. Mastiaux has massively expanded the production of green electricity and, in recent years, also the electromobility business.
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