Energy Segment

Economic environment for the energy sector

The forward market prices for electricity for delivery in 2022 in Austria showed a clear upward trend in the reporting period and rose from around EUR 46.8/MWh to EUR 58.5/MWh as at the reporting date 31 March 2021. At EUR 50.9/MWh, the average price was around 8.5% above the previous year's comparison value. The main influencing factors here were increasing prices for coal, natural gas and above all CO₂ emissions allowances. In the reporting period, these rose from EUR 26.7/t to EUR 42.6/t. Ambitious EU climate protection targets, the economic recovery after the first COVID-19 wave and speculative investors who discovered the CO₂ market for themselves led to this price development.

On the spot market, electricity prices also increased by around one third in the first half of the 2020/2021 fiscal year compared with the same period of the previous year. The average European Power Exchange (EPEX) spot price base for delivery in Austria was around EUR 48.1/MWh with a continuing volatile development.

The oil price for delivery in May 2021 moved from USD 43.0/barrel of Brent crude oil at the beginning of the reporting period to USD 63.5/barrel at the end of March 2021. The increase was attributable on the one hand to increased demand in the course of the global economic recovery and on the other to a restrictive production policy of the OPEC+ countries.

The NetConnect Germany (NCG) gas price for the front year 2022 rose in the first half of the 2020/2021 fiscal year from EUR 14.7/MWh at the beginning of October 2020 to EUR 18.3/MWh at the end of March 2021.

Price development on international energy markets

Sources: EEX, Reuters

Business development in the Energy Segment

Sales in the Energy Segment amounted to EUR 796.9 million in the first half of 2020/2021. Compared to the same period of the previous year (EUR 707.4 million), this represents an increase of 12.7%, which is mainly attributable to increased sales revenues in the area of electricity and gas management. This was counteracted by declines in sales revenues in the area of generation, among other things due to the reduced use of the Timelkam CCGT (combined-cycle gas turbine) power plant. In contrast, increased CO₂ emissions allowances and district heating earnings had a positive effect on the Energy Segment's sales revenues.

The Energy Segment generated an operating result of EUR 50.6 million in the reporting period (previous year: EUR 31.9 million). The increase of EUR 18.7 million was due to higher earnings in the area of electricity and gas sales as well as higher EBIT contributions from electricity management and trading management in the natural gas sector. In the generation sector, declines due to the lower water level and the reduced use of the Timelkam CCGT power plant were more than compensated for by higher earnings contributions from Cogeneration-Kraftwerke Management Oberösterreich GmbH (CMOÖ GmbH), higher prices on the electricity market and lower maintenance expenses in the hydropower plant sector.

In the reporting period, an impairment in the amount of EUR 1.3 million was recognised for the Timelkam CCGT power plant due to lower expectations of future earnings contributions. Due to lower future revenue estimates, a provision of EUR 6.7 million was made for the 7Fields gas storage facility in the reporting period. The previous year's EBIT included impairments in the amount of EUR 0.7 million for the Timelkam CCGT power plant and in the amount of EUR 7.2 million for the 7Fields gas storage facility.

Use of the Timelkam CCGT power plant exclusively in congestion management

The Energy Segment recorded electricity procurement totalling 10,215 GWh in the first half of 2020/2021, an increase of 7.5% compared to the previous year's figure (9,503 GWh). In contrast, proprietary electricity procurement fell to 1,363 GWh in the reporting period compared with 1,663 GWh in the previous year.

Electricity production from thermal capacities in the Energy Segment was 306 GWh in the first half of 2020/2021, which was 44.3% below the previous year's value of 549 GWh. The main reason for this was the exclusive use of the Timelkam CCGT power plant in congestion management for grid support in the reporting period, whereas in the comparable period of the previous year, the more favourable market situation also made market deployment possible.

Electricity production from hydroelectric power in proprietary power plants and from procurement rights was 5% lower in the reporting period compared to the same period of the previous year. While production at the storage power plants increased, production at the run-of-river power plants was below the standard production capacity due to the lower water levels in the rivers. The hydro coefficient in the first half of 2020/2021 was 0.99 (previous year: 1.08).

The electricity procurement structure in the Energy Segment was as follows in the reporting period:

Electricity procurement structure without electricity trading

1st HY 2020/2021; previous year's figures in brackets

At the end of the reporting period, the Dürnau hydropower plant was in the completion phase. The replacement building is expected to be commissioned in the second half of the 2020/2021 fiscal year.

Ennskraftwerke AG, in which Energie AG holds a participating interest of 50%, reported electricity production on a par with the long-term average in the first half of 2020/2021, with a hydro coefficient of 1.00. Refurbishment of the St. Pantaleon power plant on the Enns river began in the first half of the 2020/2021 fiscal year. Energie AG holds electricity procurement rights to the hydropower plants of Ennskraftwerke AG and Verbund Hydro Power GmbH with a total annual standard production capacity of about 1,406 GWh.

Energie AG's wind power portfolio in Austria comprises investments in four wind parks with a pro rata overall performance of nearly 15 MW. Generation from wind power in the reporting period was 19 GWh (previous year: 23 GWh).

Energie AG operates photovoltaic plants in Austria and Italy via subsidiaries with a total capacity of 12 MW. The 3 GWh of electricity generated in the first half of 2020/2021 (previous year: 4 GWh) was fed directly into the public grid.

The distribution of district heating from the power plant locations in Riedersbach and Timelkam was 188 GWh, a drop of 4.1% compared with the previous year (196 GWh).

In Laakirchen, CMOÖ GmbH supplies a key account customer with electricity and process heat through a CCGT power plant, as well as several adjacent companies with district heating. The volume of process heat and district heating generated in the first half of the 2020/2021 fiscal year was 361 GWh and thus 10.6% lower than the previous year's figure of 404 GWh.

Solid first half year for Energie AG Sales

Despite the tense economic situation due to the COVID-19 pandemic and the challenging general energy policy conditions, the first half of the year can definitely be viewed as successful for the Energie AG Sales unit. The number of heating degree days in Upper Austria in the reporting period increased by 8.1% compared with the previous year, and was 2.3% above the average for the past five years.

In the telecommunications sector, numerous sales campaigns and increased demand drove the continuing successful acquisition of customers forward despite COVID-related restrictions in customer support. In the electricity and natural gas sectors, the COVID-19 pandemic has thus far had only a minor negative impact. However, an increase in bad debts is expected here as of summer 2021, when state subsidies stop.

Electricity sales volume

in GWh

The decline in customer switching behaviour also had a positive effect on the sales result. This trend is reflected throughout Austria in the statistics published by E-Control Austria.

Electricity

At 3,650 GWh, Energie AG's consolidated electricity sales volume in the first half year 2020/2021 was 177 GWh below the previous year's figure of 3,827 GWh.

Despite the challenging environment, the business and industrial customer sector recorded only a moderate decline in volumes and only few customer losses. The volumes in the residential, commercial and municipal customer sector were above the previous year's level; this is attributable on the one hand to the colder winter and on the other also to the lower switching rate compared to the previous year.

Natural gas

Natural gas sales volume

in GWh

At 4,047 GWh, the volume of natural gas sold by Energie AG in the first half of 2020/2021 was around 0.5% below the previous year's figure of 4,067 GWh.

In the business and industrial customer sector, there were increases in sales to key account customers, which were, however, offset by isolated customer losses. In the case of residential, commercial and municipal customers, both the lower temperatures and the lower switching figures led to an increase in sales volumes.

Heat

The heat sales volume in Austria amounted to 764 GWh in the first half of 2020/2021 and was therefore on a par with the previous year's level of 765 GWh.

In addition to the district heating sales volume and the heat sales volume supplied to customers by CMOÖ GmbH, the heat sales volume also includes the energy contracting business area.

Telecommunications

Heat sales volume Austria

in GWh

The figure of 10,000 subscribers was exceeded for the first time in the past half year 2020/2021. As of 31 March 2021, some 11,000 customers were actively using Energie AG's products. The figure from the comparison period last year was around 7,000 customers.

Photovoltaics

In the first half year 2020/2021, contracts for 21 new photovoltaic plants with an output of 4,580 kW_p were concluded on the basis of a contracting service.

Electromobility

The focus of electromobility activities is currently on charging solutions (business solutions for company locations, residential buildings, public and private charging infrastructure). Parallel to this, the targeted installation of public charging stations including operations management and service packages with local partners was continued. Energie AG currently operates 103 publicly accessible charging stations with various output ranges from 3.7 kW to 50 kW, including a billing system, and manages a total of over 298 charging points.