Electricity transmission system operator 50Hertz presents balance sheet for 2018
Dr Frank Golletz, the designated Interim CEO of 50Hertz, speaks at the annual conference 2018. To his right Boris Schucht, CEO 2010-2019, CFO Marco Nix and the Chairman of the supervisory board, Chris Peeters. Left Kerstin Rippel, Head of communication and public affairs 50Hertz. Photo: Jan Pauls
Berlin, 26/02/2019. Once more, the north-east of Germany is in the lead when it comes to the integration of renewable energy sources into the electricity supply. At 56.5 per cent, over half of the electricity consumed last year in the 50Hertz grid area was generated from renewable sources. In 2017, the first year the 50 per cent threshold was crossed, this number amounted to 53.4 per cent. The installed capacity of renewable energy increased from about 31.3 gigawatts (GW) in 2017 to 32.9 GW in 2018. “We are proud that with this record share of renewables, we can contribute to a successful energy transition,” said Boris Schucht, CEO of 50Hertz, during the company’s balance sheet press conference held in Berlin on 26 February 2019. And this share will continue to increase in the 50Hertz grid area, also in view of the politically decided renewable growth target of 65 per cent for 2030, which is expected to already be achieved in the 50Hertz grid area in 2021.
Despite the growth of renewable energy by 1.6 GW, the congestion management costs dropped significantly last year: the amount of electricity and the costs for congestion management - also for the increase and decrease of conventional power plant output (so-called redispatch) as well as the lowering of output by renewable energy installations for the purposes of system stability - clearly decreased in 2018 compared to last year. Whereas in 2017, the total cost still amounted to about 207 million EUR, 50Hertz saw a decrease by about 100 million EUR to approximately 105 million EUR in 2018, based on temporary data. The South-West Interconnector (“Thuringian Power Bridge”) has a particularly positive impact on the lower congestion management costs. Other factors for this positive development are optimised redispatch processes, lower power exports to Austria and France and the operational phase-shifting transformers at the borders with Poland and the Czech Republic, which allow better control of the load flows.
Infrastructure development moves forward
In 2018, progress was also made in infrastructure development: offshore, for example, all submarine cables to connect the offshore wind farms Wikinger and Arkona-Becken in the Baltic Sea to the north-east of Rügen in the scope of the Ostwind 1 project have been in trial operation since last year. For the offshore project Kriegers Flak Combined Grid Solution, too, voltage has been applied to the connection of a wind farm located in Danish waters (Kriegers Flak) to a wind farm located in German waters (Baltic 2) since last year; this connection will be integrated into the grid in 2019. Onshore, the phase-shifting transformers on the German-Czech border were put into operation in 2018, as were two substations in Lubmin and Ragow. Progress was also made on the SuedOstLink direct current project: the documents for federal sector planning were submitted and the European tender was launched for the underground cables.
Very good economic result at high investment Level
With a result of 238 million EUR according to IFRS, 2018 was an outstanding year for 50Hertz in economical terms (2017: 182 million EUR). CFO Marco Nix presented the results for the previous year in detail: “Also as a result of our efforts to improve efficiency, we were able to achieve a very good result last year”, said Nix. The overall performance of the company exceeded ten billion EUR for the first time. The principal part of the turnover was obtained through profit from RES trade transac-tions, despite this being an item without effect on net income due to the remunera-tion and surcharge mechanism of the German Renewable Energy Act (EEG). The grid turnover approximated 1.37 billion EUR last year (2017: 1.33 billion EUR).
In the last five years 50Hertz already invested over three billion EUR in the grid, of which 492 million EUR during the past financial year. For the next five years, i.e. until 2023, 50Hertz is planning investments of about 3.4 billion EUR to transform the energy system, and 420 million EUR for 2019. In total, about 1.6 billion EUR of financial means are already available for the investment activity.
Political and regulatory framework conditions need to be developed further
CTO Dr Frank Golletz gave an outlook for the current year. On 1 March 2019, he will succeed Boris Schucht, who will leave the company at the end of February, as interim CEO. Golletz announced the continuation of the ambitious investment programme in the onshore and offshore domains and referred to the need for a tailormade and innovation-friendly political and regulatory framework with a view to the implementation of the energy transition targets and the resulting investments. This particularly applies to the upcoming amendment of the Grid Expansion Acceleration Act, the draft of which is headed in the right direction. All things considered, he sees his main task as interim CEO to provide stability and continuity in the management of 50Hertz: “Together with all employees we will continue to do our job and implement grid development in Germany according to the needs of the energy transition. We are also making good progress with regard to the optimisation of the existing grid. Society, economy and politics can rely on 50Hertz to keep making its contribution to the success of the energy transition. Our goal is and remains a successful energy transition in a sustainable world,” said Dr Golletz.
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