EU energy policies appear to be working; the conventional electricity industry may not be so enthusiastic

RWE AG, Germany’s second largest producer of electricity, provided some interesting insights in its recent first half of 2013 corporate performance report:

the company has decided to take about 3,100 megawatts of conventional generating capacity offline in Germany and the Netherlands “due to the continuing boom in solar energy” which the Company attributes to EU subsidies.

feed-ins from solar panels and wind turbines are increasingly replacing electricity generated by fossil-fuelled power stations, contributing to the steep decline in prices for EU carbon emissions trading credits.

the world coal market tends to be oversupplied and prices for coal used for power generation are falling.

the company ceased operation of a 1958 MW coal fired power plant in the UK because the plant does not meet current EU emission requirements.

an oil-fired power plant in the UK was shut down for economic reasons associated with the plant not meeting current EU emission requirements.

despite a slight decline in sales volume, the Company’s revenue from electricity sales was up 2% due to price increases.

the operating result recorded by RWE Innogy, RWE’s renewables division, was up 3%.

The RWE Report on the First Half of 2013 can be found at http://www.rwe.com/web/cms/mediablob/en/2011524/data/110822/4/rwe/investor-relations/reports/RWE-Report-H1-2013.pdf

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