RWE posts historic net loss as writedowns bite

[GliderGuider]

RWE posts historic net loss as writedowns bite

(Reuters) - Germany's biggest power producer RWE AG has posted its first annual net loss in more than six decades, after a surge in solar and wind capacity undercut the profitability of its power plants and triggered nearly 5 billion euros ($6.9 billion) in writedowns.

The company said on Tuesday it had swung to a net loss of 2.76 billion euros from a profit of 1.31 billion a year earlier, its first net loss since 1949. Sources had told Reuters on Friday that the group may post a full-year net loss of close to 3 billion euros.

Many of Europe's big power producers have been slow to respond to a fast-growing renewable sector and have also been hit by weak energy demand and record-low wholesale power prices.

Last week, a 15 billion euro writedown dragged French peer GDF Suez (GSZ.PA) deep into the red and the company warned that the crisis in the European utilities sector would last for a long time.

Well would ya look at that!

[eppur_se_muova]

1. But but but renewables will never be a major part of the market ! nt

[GliderGuider]

2. They may or may not ever make up a major part of our energy consumption

But they do have the potential to upset energy markets. Whether that will be a good thing or a bad thing remains to be seen.

[kristopher]

4. No, we can see it right now.

Bad if you have vested interests in preserving fossil fuels and nuclear.

Good if you give a damn about the planet.

[LouisvilleDem]

5. Any market can be upset...

...when you introduce subsidized competition.

[kristopher]

6. Or preserved by decades of massive subsidies that the existing entrenched industries use...

... to exclude competition. Add in the ability of the entrenched (fossil/nuclear) industries to also externalize significant costs that the competition (renewables) do not incur and your remark isn't making much of a contribution to understanding what is happening.

[LouisvilleDem]

9. Absolutely

[kristopher]

3. fast-growing renewable sector ... weak energy demand ... record-low wholesale power prices

Cause .... effect ... effect


These two go together also:

...slow to respond to a fast-growing renewable sector...


the crisis in the European utilities sector ... last for a long time


This is the formula for eliminating fossil fuels worldwide.

[Demeter]

7. The times they are a changin'

Finally. Been waiting and working 60 years for this.

[GliderGuider]

8. Yes, they do seem to be.

I'll wait for a bit to let the meaning of the situation clarify, though.