Professional Documents
Culture Documents
September 2012
Forward-looking statement
RWE Facts&Figures 2012 contains certain forward-looking statements as defined by US federal securities laws. This predominantly relates to the following statements:
> Projections of revenue, income, earnings per share, capital expenditure, dividends, the capital structure and other financials; > Statements of plans or objectives for future operations or concerning the companys future competitive position; > Expectations of future economic performance; and > Statements of assumptions underlying several of the foregoing types of statements, all of which are forward-looking statements.
Also words such as anticipate, believe, estimate, intend, may, will, expect, plan, project, should and similar expressions are intended to identify forward-looking statements. The forward-looking statements reflect the judgement of RWEs management based on factors currently known to it. No assurances can be given that these forward-looking statements will prove accurate and correct, or that anticipated, projected future results will be achieved. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. Such risks and uncertainties include, but are not limited to, changes in the general economic and social environment, business, political and legal conditions, fluctuating currency exchange rates and interest rates, price and sales risks associated with a market environment in the throes of deregulation and subject to intense competition, changes in the price and availability of raw materials, risks associated with energy trading (e.g. risks of loss in the case of unexpected, extreme market price fluctuations and credit risks resulting in the event that trading partners do not meet their contractual obligations), actions by competitors, application of new or changed accounting standards or other government agency regulations, changes in, or the failure to comply with, laws or regulations, particularly those affecting the environment and water quality (e.g. introduction of a price regulation system for the use of power grids, creating a regulation agency for electricity and gas or the introduction of trading in greenhouse gas emissions), changing governmental policies and regulatory actions with respect to the acquisition, disposal, depreciation and amortisation of assets and facilities, operation and construction of plant facilities, production disruption or interruption due to accidents or other unforeseen events, delays in the construction of facilities, the inability to obtain, or to obtain on acceptable terms, necessary regulatory approvals regarding future transactions, the inability to successfully integrate new companies within the RWE Group to realise synergies from such integration and the potential liability for remedial actions under existing or future environmental regulations and the potential liability resulting from pending or future litigation. Any forward-looking statement is valid only as of the date on which it is made. RWE neither intends to, nor assumes any, obligation to update these forward-looking statements. * Footnotes are to be inserted manually (using copy and paste). For additional information regarding risks, investors are urged to consult RWEs latest annual report, other reports recently filed with the Frankfurt Stock Exchange and the material furnished to the US Securities and Exchange Commission by RWE.
Organisation
RWE in a nutshell Board Structure Germany: Power Generation Germany: Sales/Distribution Networks Netherlands/Belgium United Kingdom Central Eastern and South Eastern Europe Renewables Upstream Gas & Oil Trading/Gas Midstream 5 7 8 10 12 14 17 20 22 24 26
91
Market data
Electricity > Generation > Fuels > Trading > Grid > Supply Gas > Trading > LNG > Storage > Downstream > Supply > Turkish market > Czech market 92 93 113 115 118 121 133 134 136 138 140 141 145 146
28
151
RWE
Electricity > Generation > Fuels > Trading > Grid > Supply Gas > Upstream > Storage > Trading > Downstream Investor Relations 152 153 184 187 189 190 197 198 207 209 212 219
62
Political environment
Overview Combined Heat and Power (CHP) Act Renewable Energy Act Climate policy Emissions trading Large Combustion Plant Directive (LCPD) Grid 63 64 65 72 75 80 82
Organisation
Political environment
Market data
RWE
Organisation
5 7 8 10 12 14 17 20 22 24 26 RWE in a nutshell Board Structure Germany: Power Generation Germany: Sales/Distribution Networks Netherlands/Belgium United Kingdom Central Eastern and South Eastern Europe Renewables Upstream Gas & Oil Trading/Gas Midstream
POLITICAL ENVIRONMENT
MARKET DATA
RWE
RWE markets with established market positions Growth markets under observation (initial activities in some cases)
Additional markets especially for renewables Additional markets especially for upstream gas & oil
x/y of electricity/gas
Total Europe
No. 6
We have leading positions in two of Europes largest markets as well as in fast growing SEE/CEE markets and own a large upstream position in both Europe and North Africa.
1 Market positions of the RWE Group in terms of sales.
RWE Facts & Figures | Updated September 2012
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Electricity
17
Gas
Water
151
10
15
20
1 Figure relates to drinking water and sewage water. Population served in Continental Europe.
ORGANISATION Board
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Peter Terium
Chief Executive Officer of the Executive Board (appointed until 31 August 2016)
Alwin Fitting
Chief Human Resource Officer (appointed until 31 March 2013)
ORGANISATION Structure
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Netherlands/ Belgium
United Kingdom
Renewables
Trading/Gas Midstream
RWE Power
Essent
RWE npower
RWE East
RWE Innogy
RWE Dea
ORGANISATION Structure
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Lignite
Wood pellets
Conventional
Renewables
RWE Dea
RWE Power
RWE Innogy
RWE Power
RWE Innogy
RWE Deutschland
RWE East
RWE npower
RWE npower
RWE East
Essent
Essent
1 NET4GAS1
RWE npower
RWE East
RWE Power
Essent
> Integrated business model: strong presence in all parts of the energy value chain > Stability and growth: well balanced portfolio of leading market positions in mature and growing markets in Europe
ORGANISATION Germany
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Key figures
EBITDA ( million) Operating result ( million) Workforce1
1 Converted to full-time positions.
2011
3,252 2,700 15,371
2010
4,510 4,000 15,409
10
ORGANISATION Germany
POLITICAL ENVIRONMENT
MARKET DATA
RWE
31,285
152.0
11
ORGANISATION Germany
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Key figures
External revenue ( million) EBITDA ( million) Operating result ( million) Workforce1
1 Converted to full-time positions.
2011
20,354 2,167 1,505 20,398
2010
18,456 2,218 1,575 18,775
12
ORGANISATION Germany
POLITICAL ENVIRONMENT
MARKET DATA
RWE
6,823
6,674
31.4
117.3
25.5
1,091
31.8
24.0
83.3
27.5
13
ORGANISATION Netherlands/Belgium
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Netherlands/Belgium (I)
Who we are
> Essent is the largest energy company in the Netherlands. The company has a well-balanced and flexible generation portfolio (consisting primarily of gas and hard coal power stations). In total, Essent had 3.1 GW in generation capacity at the end of 2011 and produced some 11.5 billion kWh of electricity in 2011. > By investing into processes to co-fire biomass at our Amer and Eemshaven power stations we intend to further increase the proportion of renewables in our energy mix. > In 2011, 2.2 million and 1.9 million households and small commercial enterprises were supplied with electricity and gas in the Netherlands, respectively. > Two new gas power stations went online at the beginning of 2012. A state-of-the-art hard coal-fired power plant is currently being built.
Key figures
External revenue ( million) EBITDA ( million) Operating result ( million) Workforce1
1 Converted to full-time positions.
2011
5,818 462 245 3,794
2010
6,510 660 391 3,899
14
ORGANISATION Netherlands/Belgium
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Netherlands/Belgium (II)
Generation capacity as of 31 Dec 2011 (MW)
Gas 1,897
916
3,144
Hard coal
5.1
11.5
Amercentrale, Geertruidenberg Coal, gas, biomass, 1,226 MW Swentibold, Geleen Gas, 245 MW
Renewables
1.3
15
ORGANISATION Netherlands/Belgium
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Netherlands/Belgium (III)
External electricity sales 2011 (billion kWh)
Residential and commercial customers
10.7
36.9
21.0
Industrial and corporate customers 10.3 Industrial and corporate customers 50.8
87.7
16
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Key figures
External revenue ( million) EBITDA ( million) Operating result ( million) Workforce1
1 Converted to full-time positions.
2011
7,696 606 357 12,053
2010
7,759 504 272 11,711
17
POLITICAL ENVIRONMENT
MARKET DATA
RWE
11,468
2,657
Pembroke 2,188 MW
Staythorpe 1,728 MW
Aberthaw B 1,554 MW
Hard coal
8.6
29.9
18
POLITICAL ENVIRONMENT
MARKET DATA
RWE
32.9
38.0
50.3
Residential and commercial customers 17.4 Industrial and corporate customers 2.2
40.2
Electricity and gas customers (households and small commercial enterprises, thousand)
8,000 6,000 3,877 4,000 2,000 0
Electricity Gas Total
RWE Facts & Figures | Updated September 2012
6,571
2010 2011
19
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Key figures
External revenue ( million) EBITDA ( million) Operating result ( million) Workforce1
1 Converted to full-time positions.
2011
4,990 1,364 1,109 11,328
2010
5,297 1,440 1,173 11,163
20
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Residential and commercial customers RWE Polska: Electricity: No. 5 VSE Electricity: No. 3 Gas: No. 2 RWE Turkey Electricity: presence
8.7
RWE Transgas Electricity: presence Gas: No. 1 RWE Hungria Electricity: No. 2 Gas: leading position
RWE East core markets Growth markets under observation Other RWE Group core markets
21
ORGANISATION Renewables
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Renewables (I)
Who we are
> RWE Innogy was established in February 2008; it pools the RWE Groups renewables expertise and power stations, focussing regionally on Europe. > Onshore and offshore wind power projects are a focus of the company's activities. RWE Innogy will also expand its biomass and hydroelectric activities. We also support the development of new technologies for the future. > RWE Innogy was launched with 1,100 MW in 2008. At present, we already operate a power plant capacity of around 2.4 GW. > We are especially strong in our home market in Germany, followed by the United Kingdom, Spain, the Netherlands, Poland and Italy.
Key figures
External revenue ( million) EBITDA ( million) Operating result ( million) Workforce1
1 Converted to full-time positions.
2011
443 338 181 1,493
2010
366 211 72 1,232
22
ORGANISATION Renewables
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Renewables (II)
RWE Innogys asset base by region (MW) Generation capacity as of March 2012 (MW)
Onshore wind Hydro NL UK BE DE France Switzerland Czech Republic Poland Biomass Offshore wind 110 150 1,607 542
2,4111
Under construction Nordsee Ost, GER, 295 MW Gwynt y Mr3, UK, 576 MW Greater Gabbard4, UK, 504 MW Thornton Bank II+III2, BE, 295 MW
Biomass Hydro
New technologies
owned by Zephyr Investments Ltd. owned by C-Power consortium. Stadtwerke Munich (30%) and Siemens (10%). Scottish and Southern Energy (50%).
23
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Key figures
External revenue ( million) EBITDA ( million) Operating result ( million) Workforce1
1 Converted to full-time positions.
2011
1,766 923 558 1,362
2010
1,353 619 305 1,363
24
POLITICAL ENVIRONMENT
MARKET DATA
RWE
United Kingdom
0.5
2.6
Norway
0.9
2.5
Egypt Denmark 0.5 0.2
Norway
0.3
228 162
51 91
237 158
56 104
66
40 26 2010
2 01 0
79
48 31
20 11
137
G e s a mt
102
2 01 1
133
G e s a mt
200 0
Gas
Oil
2011 Total
2006
2007
2008
2009
2010
2011
25
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Key figures
External revenue ( million) EBITDA ( million) Operating result ( million) Workforce1
1 Converted to full-time positions.
2011
5,750 -784 -800 1,562
2010
7,517 -7 -21 1,512
26
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Gas
Aluminium, steel & mining Fine chemicals & pharmaceuticals Transport, automotive & other Glass, paper & cement Primary industry/ petrochemistry
23.2
12% 32% 8% 4%
15.9
7% 21%
27
Organisation
Political environment
Market data
RWE
28
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
> Cornerstones of strategy remain > Adjust execution of strategy to changing framework conditions No further nuclear ambitions with existing operations phasing out Continued expansion of renewables including position in photovoltaic > Increasing partnerships to reduce risks and leverage capital base > Disciplined investment approach: operating cash flow to cover dividends and capex by 2014/15 at the latest
29
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
30
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
More renewables
> Increase renewable generation capacity to at least 20% by 2020 Estimated generation portfolio 2020 ~ 20% ~ 5%
~ 40%
~46 GW ~ 35%
Gas/other Renewables
31
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
5.8bn
Germany ~2/3
5.8bn
Regulated ~30%
32
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Efficiency enhancement
> 2012 programme on track to be completed > Measures of new programme fully identified > RWE 2015 is laying the foundation for further efficiencies post 2014
33
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
RWE 2015 four action fields to align RWE with changing market environment
> Identify opportunities of energy market transformation Strategy > Align execution of strategy to changing market environment > Eliminate structural and operational duplications and clarify interfaces > Establish European generation company > Drive efficiency enhancements and operational excellence > Realise efficiencies of 1 bn by 2014 compared to 2012
Structures/ Roles
Functional excellence
Cultural change
> Align management and employees across all parts of RWE > Foster high performance culture
34
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
> Peak of investment programme in 2010/2011 > Finalising conventional power generation programme mainly in 2012 and 2013
~16
> More than 60% of our capex will be spent in our international businesses > Sustainable long-term capex level of up to 5 bn p.a. of which day-to-day capex up to 2.5 bn p.a.
5.9
6.4
6.4
~6
~4 5 p.a.
> Approx. 16 bn capex programme for 2012 2014 of which c. 8 bn for growth/efficiency enhancement, thereof c. 6 bn in our growth areas Renewables, CEE/SEE and Upstream Gas & Oil > Committed capex (including day-to-day, approx.): 2012 2013 2014 95% 85% 65%
2009
2010
2011
2012e
2013e
2014e
35
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
~ 10%
Upstream Gas & Oil2
> 2014 targets post planned disposals: Gas and oil production of ~ 40 mm boe Operating result of ~ 800m > Development focus on UK, Norwegian and North African gas fields > Longer term growth secured through continued successful exploration effort
~ 30%
~6
bn1
~ 60%
Regional diversification across core markets Focus on most cost competitive technologies to minimise regulatory risk
1 Growth and replacement capex, excluding day-to-day capex. 2 Divisional split; regional overlap due to potential upstream and renewable investments in Central Eastern/South Eastern Europe.
RWE Facts & Figures | Updated September 2012
36
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
By 2014 we will have renewed more than 25% of our electricity generation fleet
Gas
BoA Neurath 2.1 GW lignite
2010
H1 2012
H2 2012
Q1 2013
2013/2014
2014
37
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
2014
38
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Capacity and earnings targets for RWE Innogy until 2014 are mainly driven by 4 major projects Large scale projects, especially in offshore wind, play a vital role in achieving European renewable targets as growth potential in other areas is limited Utilities like RWE have a competitive advantage in these large-scale projects
1 Capex at 100% share; UK offshore includes investment for grid connection. 2 The construction schedule had to be revised in 2012 due to the delay in the offshore grid connection. In light of latest statements by grid operator TenneT there is a risk of even further delays.
RWE Facts & Figures | Updated September 2012
39
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
~ 20% ~ 5%
~ 46 GW
~ 40% ~ 35%
Gas/other1
1 Including approx. 8% of others, mainly pumped storage.
40
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Stable portfolio: 30% of operating result derived from regulated businesses (2011)
External revenue
Unregulated business 80%
EBITDA
Unregulated business ~70%
Operating result
Unregulated business ~70%
Regulated business
51,686 million
20%
8,460 million
5,814 million
Regulated business particularly includes: > German electricity and gas networks > Electricity supply in Hungary > Eastern European electricity and gas networks and storage > Continental European water business > Renewables
41
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
8.8
5.5
2010
2011
2014/2015e
Cash flows from operating activities
Capex in property, plant & equipment and financial assets Dividends (incl. minority payments; year of payment)
42
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Several hundred individual measures across the whole RWE group Programme includes c. 300 m from workforce reduction in 2013/14 Fully accretive to operating result (i.e. post cost inflation and one-off cost of programme)
43
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
EBITDA
~9,000
Operating result
5,814
2,479 2011
Dividend
2.00/share
1 Expected earnings dilution from the remaining up to 7 bn divestment programme: in bn 2012 Full year effect (after 2013) EBITDA ~0.5 Operating result no major dilution effect expected ~0.4 Recurrent net income ~0.3
44
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
2008 8.23% 2008 50% 2008 from 100 to 60.5% 2009 from 60.5 to 0% 2009 51% less one share 2011 from 100 to 0% 2011 from 100 to 25,1%
1 Divestment by Essent in order to obtain approval for acquisition of Essent N.V. by RWE.
45
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Clean air2
407
14
Waste disposal Water protection3 Nature and landscape protection Noise abatement Brownfield sites, soil contamination
208 298 93 20 4
7 10 3 1 0
46
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Mondrian Investment
3%
63%
> 260,000 shareholders own 614.7 million shares > Free float: 85% (excluding RW Energie-Beteiligungsgesellschaft)
> 86% of all RWE shares are held by institutional investors > The regional breakdown is as follows: Germany USA/Canada UK/Ireland Continental Europe (excl. Germany) Rest of the world 34% 12% 19% 19% 2%
47
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
48
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
3.50 Bonus 0.10 1.00 1.75 3.15 4.50 3.50 3.50 2.00
1.00
1.25
1.50
2001 1
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
49
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Recommendations & reporting > RWE AG subsidiaries: > RWE Pensionstreuhand e.V. (PTV): > RWE Pensionsfonds AG (PF): > UK Pension Trust - RWE npower: 2.2 bn 3.1 bn 6.6 bn 4.1 bn
Investment guidelines
Internal management
External management
4 66
50
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Intercompany loans
RWE subsidiaries
> RWE AG acts solely as external counterparty for financial transactions (excluding regulatory requirements) > Corporate Group Treasury has the overall responsibility for treasury operations > Central database for group-wide financial risk management
RWE Facts & Figures | Updated September 2012
51
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
2012
2016
2020
2024
2028
2032
2036
2040
52
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
18%
33%
19.7 bn
20.5 bn1
67%
82%
Interest rate fixing expiry > 1 year Interest rate fixing expiry < 1 year
53
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
54
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Financing costs: Rising interest rates may lead to higher financing cost Interest rate exposure from financing activities is measured with Cash Flow at Risk Average Cash Flow at Risk (95/1y)2 in 2011: 19m
> Measurement of exposure (caused by cash, term deposits, FX/IR derivatives etc.) for each bank > RWE allocates for each bank a limit which is usually derived from the banks equity, rating and CDS > Shares are part of RWEs asset portfolio > Average Value at Risk (95/1d)1 of share price changes in 2011: 12m
Equity Risk
1 Confidence level: 95%; holding period: 1 day. 2 Confidence level: 95%; holding period: 1 year.
RWE Facts & Figures | Updated September 2012
55
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
RWE Finance BV EUR RWE Finance BV USD RWE Finance BV GBP RWE Finance BV EUR RWE Finance BV EUR Redemptions 2012 - 2014 RWE Finance BV EUR RWE Finance BV EUR RWE AG EUR RWE Finance BV EUR Redemptions 2015 - 2018 RWE Finance BV EUR RWE Finance BV GBP RWE Finance BV EUR RWE Finance BV GBP RWE Finance BV GBP Redemptions 2019 - 2023 RWE Finance BV GBP RWE AG EUR RWE Finance BV GBP RWE Finance BV GBP RWE AG JPY Redemptions from 2030 onwards Total
1,808.0 203.5 803.6 1,000.0 530.0 4,345.1 2,000.0 850.0 100.0 980.0 3,930.0 1,000.0 727.1 1,000.0 637.8 621.9 3,986.7 969.4 600.0 765.4 1,275.6 208.3 3,818.7 16,080.5
Hybrid bonds
RWE AG RWE AG RWE AG RWE AG RWE AG Total hybrid capital EUR CHF CHF GBP USD Public Public Public Public Public 1,750.0 250.0 150.0 750.0 1,000.0 1,750.0 208.1 124.9 956.7 814.1 3,853.7 perpetual Limited Limited perpetual limited 28.09.2010 21.10.2011 28.06.2012 20.03.2012 29.03.2012 28.09.20152 04.04.20172 26.07.20172 20.03.20192 12.10.20172 4.625 5.250 5.000 7.000 7.000 A1EWR0 A1MAVP A1PGUU A1ML0G A1ML2E XS0542298012 CH0136594352 CH0185843049 XS0652913988 XS0767140022
1 As of 31 July 2012. 2 First occasion for RWE to redeem the hybrid bond. RWE Facts & Figures | Updated September 2012
56
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Split of securities
17.4 %
20
15.8
8 6 4
6.6 0.7
2.2
7.3
1.0 2.2 0.8
15 10
5.5
13.7
16.5
0.8
5 0.3
0.6
1.8 2.8
2 0
2.9
3.3
82.6 %
1 Excluding variation margins which are netted against the fair values of the respective derivatives.
57
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
Accounting Department
Commodity Management
Management of commodity risks
Operating Companies
RWE Facts & Figures | Updated September 2012
58
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
CFO of RWE AG
> Responsible for tracking and monitoring commodity risks with regard to both the market and the credit side
Group Controlling
> Is responsible for the approval of methods and models for the valuation of commodity risks > Sets standards for risk measurement, monitors commodity risks and reports on these to the Executive Board > Analyses and approves credit limits for large commodity counterparties, large suppliers and banks > Manages strategic commodity positions > Grants approvals for detailed hedging strategies and large commodity transactions within the framework determined by the Executive Board > Derives detailed limits for the commodity risks of the operating companies from the risk caps established by the Executive Board
Commodity Management
Operating companies
> Handle operative commodity and credit risk management > Control and monitor commodity risk positions
59
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
grants
restrict
grants
Comments on adequacy of limit requests to be granted by executive board and monitors limit utilization
Group Controlling
restrict
60
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE
> Counterparties are assessed using internal rating tools, where available external rating information are also taken into account > All counterparties are monitored on an ongoing basis and reviewed on a regular basis
> Potential future credit exposure (= potential replacement value) is calculated with a Value-at-Risk-like methodology > In addition, both current and future settlement exposure is measured > Counterparty credit exposures are reviewed on a near-time basis
> Credit capital costs are based on the rating/probability of default (PD) of a counterparty > Performance determination includes credit risk charges
> Bundling of know-how in a central credit risk management unit > RWE Supply & Trading was a key driver of the EFET1 standards for power and gas with more than 130 EFET agreements having been signed so far > RWE Supply & Trading plays a leading role in the development of exchanges/OTC clearing
61
Organisation
Market data
RWE
Political environment
63 64 65 72 75 80 82 Overview Combined Heat and Power (CHP) Act Renewable Energy Act Climate policy Emissions trading Large Combustion Plant Directive (LCPD) Grid
62
ORGANISATION
MARKET DATA
RWE
Climate Protection Act1 in North Rhine-Westphalia Energy Market Reform1 Carbon Tax ECO/ Green Deal Retail Market Reform1 1 2 3 4 ROC3
Coal tax1
SDE+4
Announced or going through the legislative procedure. Renewable Energy Act. Renewable Obligation Certificate. Sustainable Energy Incentive Scheme (Subsidieregeling duurzame energieproductie).
RWE Facts & Figures | Updated September 2012
63
ORGANISATION
MARKET DATA
RWE
Levels of subsidy
Volume
Funding
Limitation of the burden on industry >Max. 0.05 ct/kWh for large consumers with a yearly consumption of more than 100,000 kWh >Max. 0.025 ct/kWh for energy-intensive industry (> 4% of energy costs of gross production value) Passing-on clause Network operators have the right to pass on all feed-in payments
1 Figures and scheme taken from the amendment in 2012 effective July 19, 2012.
64
ORGANISATION
MARKET DATA
RWE
Passing-on clause
1 Figures and scheme taken from the German Renewable Energy Act effective as of January 1, 2012.
65
ORGANISATION
MARKET DATA
RWE
1 Figures and scheme taken from the German Renewable Energy Act effective as of January 1, 2012 (PV: as of April 1, 2012). 2 Depending on size of plant, year of commissioning operation and technology. Source: German Ministry for the Environment, Nature Conservation and Nuclear Safety.
66
ORGANISATION
MARKET DATA
RWE
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
170
Power generated (bn kWh) Power generated (bn kWh, forecast) Feed-in fees ( bn) Feed-in fees ( bn, forecast)
bn 0
1.0
2.0
3.0
4.0
5.0
6.0 7.0
8.0
9.0 10.0 11.0 12.0 13.0 14.0 15.0 16.0 17.0 18.0 19.0 20.0 21.0 22.0 23.0 24.0
Sources: German Energy and Water Association (BDEW), December 2011. German transmission system operators (www.eeg-kwk.net), data until 2010 as of May 2009, data from 2011 as of November 2010, data from 2012 on as of November 2011 (from 2012 on: fees for market premium, direct marketing and PV self consumption included).
RWE Facts & Figures | Updated September 2012
67
ORGANISATION
MARKET DATA
RWE
REA1 compensation
16 bn3
Nuclear
17.6%
27%
Renewable energy 19.9% 1 REA = German Renewable Energy Act. 2 Next to the power generation subsidised by the German REA of 92,266 GWh in 2011, another 12,332 GWh of power from renewable sources (REA electricity) was sold on the free market (direct marketing in accordance with 17 REA). 3 Including avoided network fees. Sources: Gross generation: BDEW, BMWI; REA generation + REA compensation: German transmission system operators (www.eeg-kwk.net) as of November 2010 (provisional data).
RWE Facts & Figures | Updated September 2012
68
ORGANISATION
MARKET DATA
RWE
22.1 20.7
20
23.7 0.1
15
12.3
10
3.1
3.8
1.2
0
4.3 0.2
5.2 0.3
2012 2013 2014 2015 2016
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Hydro
Biomass
Onshore wind
Offshore wind
Photovoltaic
Other
Source: Renewable Energy Act medium-term forecast of electricity transmission system operators. Data until 2010 as of May 2009, data for 2011 as of November 2010, data for 2012 onwards as of November 2011 (from 2012 onwards fees for market premium, direct marketing and photovoltaic self consumption included).
RWE Facts & Figures | Updated September 2012
69
ORGANISATION
MARKET DATA
RWE
Subsidy efficiency: contribution of German Renewable Energy Act subsidised power generation in 2011
Installed capacity MW Power generated bn kWh1
Power generation Power generation (including generation from direct marketing according to 17 EEG)
39
2,791
1,298
103
6,194
70
ORGANISATION
MARKET DATA
RWE
50.000 50,000
40.000 40,000
30.000 30,000
27,071 20,000 20.000
17,554
10.000 10,000
71
ORGANISATION
MARKET DATA
RWE
The EU has set three 20% targets for 2020. Achievement of some is challenging
Greenhouse gas (GHG) emissions
5,750 5,500 5,250 5,000 4,750 4,500 5% 4,250 1990 1995 2000 2010 2015 2015 1990 1995 2000 2005 2010 2020 2005 2020 4,000 0% 1,500 1,400 15% 10%
Energy efficiency
Mtoe Primary energy consumption (Mt OE)
1,900 1,800 1,700 1,600 EU 27 EU 25 20% target - EU25
Mt CO2e
Actual GHG emissions 20% target
1995
2000
2005
2010
2015
> 2020 just interim step to even tighter targets in 2050 > Nuclear moratorium in Germany has shifted balances by 45Mt per year
> EU RES target translates into country-specific RES targets of member states > Attractive RES subsidy schemes implemented across Europe
> Appears most challenging > Addressed by European Commission now > Country specific concerns: when is a house properly insulated? How fast should we move?
Source: EuroStat, UNFCCC. GHG=Greenhouse Gas Emissions, CO2e=CO2 equivalent, OE=Oil equivalent. Latest available official data from 2009.
RWE Facts & Figures | Updated September 2012
1990
2020 72
ORGANISATION
MARKET DATA
RWE
baseline
5,500 5,000 4,500
> Return to economic growth may temporarily level off or reverse the decline in emissions > Impact of German nuclear moratorium is assessed at around 45 mt additional emissions per year > Thats 1% of total EU emissions
-20% target
1995 2000 1970 1975 1980 1985 1990 2005 4,000
> CO2 balances for the EU ETS have turned negative and system is now slightly short
Scaled trend
Absolute greenhouse gas emissions in the EU 27, 1970 2009, million ton CO2 equivalents. Source: EEA.
RWE Facts & Figures | Updated September 2012
73
ORGANISATION
MARKET DATA
RWE
Renewable energy sources: currently it is far from certain that EU target and utility sector sub-target will be achieved
Share of RES in final energy demand
% 25
20 15 10 5 0 2001 2005 2010 2020
> According to national renewable energy action plans the targets for 2020 will be met > To achieve these targets renewable energy production needs to increase at an annual growth rate of 5% > To achieve the sub-target for the utility sector, growth in the order of 9% per year is required > This requires close to double the growth seen between 2005-2010 > According to EU estimates, annual capital investments need to double to 70bn
+9% p.a.
74
ORGANISATION
MARKET DATA
RWE
12% 8% 7% 4%
401 mt CO2
1,993 mt CO2
6% 8% 3%
223 mt CO2
1 Excluding auctioned certificates and new entrant reserves. Source: EEA.
RWE Facts & Figures | Updated September 2012
75
ORGANISATION
MARKET DATA
RWE
Emissions EU 27 2011
Electricity Metals 60% 8% 12% 8% 7%
450 mt CO2
1,879 mt CO2
221 mt CO2
76
ORGANISATION
MARKET DATA
RWE
CDM/JI projects give RWE access to cost-effective reduction of greenhouse gas emissions (I)
Clean Development Mechanism (CDM) Emission reductions through investment by an industrialised country in a country without reduction commitments are credited to the emission account of the investor country
Germany/UK
Investment
Emission rights
E.g. China
Joint Implementation (JI) Emission reductions through investment by one industrialised country in a second industrialised country are credited to the emission account of the investor country
Germany/UK
Source: UNFCCC; http://cdm.unfccc.int.
Investment
Emission rights
E.g. Russia
77
ORGANISATION
MARKET DATA
RWE
CDM/JI projects give RWE access to cost-effective reduction of greenhouse gas emissions (II)
Expected average annual certificates from registered CDM projects by host country in September 2012
China India Brazil Republic of Korea Mexico Indonesia Vietnam Uzbekistan 64.2% 10.9% 3.9% 3.1% 2.0% 1.3% 1.4% 1.0%
> By September 2012, a total of 4,547 registered CDM projects is expected to supply more than 2.2 billion certificates by the end of 2012 > A substantial portion of the certificate volumes contracted are accounted for by Chinese projects
Others
12.2%
78
ORGANISATION
MARKET DATA
RWE
ERPA1 in validation
ERPA1 in validation
~100
in operation2
in operation2
Contract volume
1 ERPA = Emission reduction purchase agreement. 2 In Operation: Projects that have already issued certificates. 3 Latest EU-directive for certificates implies no additional redemption capacity for RWE Power concerning the years 2013 till 2020, but usage of certificates is still enabled post 2012. RWEs redemption capacity consists of the redemption capacity of RWE Power, RWE npower and Essent.
RWE Facts & Figures | Updated September 2012
79
ORGANISATION
MARKET DATA
RWE
Step 1
> Power plants had to choose whether to comply with the LCPD or request a limited life derogation (opt out) > Power stations which opted out are allowed to run for 20,000 hours, or until the end of 2015, whichever comes sooner
Step 2
Those power stations which comply with the LCPD are governed in one of two ways1: > Emission Limit Value (ELV) The power station must adhere to specific limits to the amounts of pollutants produced on a milligram per cubic metre of waste gas basis > National Emission Reduction Plan (NERP) A company is given an overall allowance (amount of a pollutant that can be emitted per year) of emissions it may produce. The emission allowances issued under NERP are tradable within a member state
Step 3
> In addition to the above, existing oil and coal-fired power plants must reduce nitrogen oxide emissions from 500 mg/Nm3 to 200 mg/Nm3 by January 1, 2016. This will entail fitting selective catalytic reduction (SCR) equipment 1 While most the EU member states, including Germany, chose to implement Emission Limit Values (ELV), a number have opted for National Emission Reduction Plans (NERPs), while in the UK individual power plants could choose between being regulated on the ELV, or under a NERP.
80
ORGANISATION
MARKET DATA
RWE
Due to the LCPD a shut-down of 1112 GW by the end of 2015 (or earlier) is expected in the UK market
Installation Operator Fuel Installed capacity (MW) 1,960 3,870 1,940 1,960 940 1,300 2,000 1,970 1,000 1,940 1,530 1,370 1,000 1,020 1,960 1,960 2,304 1,152 363 31,539 Capacity opted in1 (MW) 1,960 3,870 1,960 2,000 970 1,000 1,530 980 1,960 2,304 363 18,897 Capacity FGD3 status opted out2 (MW) 1,940 940 1,300 1,940 1,370 1,000 1,020 980 1,152 0 11,642 2 out of 4 units fitted Fitted No FGD Fitted No FGD No FGD Fitted Fitted Fitted No FGD Fitted No FGD No FGD No FGD Fitted Fitted 3 out of 4units fitted No FGD Fitted Eggborough Drax Kingsnorth Ratcliffe Ironbridge Grain Cottam West Burton Rugeley Didcot A Aberthaw Littlebrook Fawley Tilbury Ferrybridge Fiddlers Ferry Longannet Cockenzie Uskmouth Total British Energy Drax Power E.ON UK E.ON UK E.ON UK E.ON UK EDF Energy EDF Energy International Power RWE npower RWE npower RWE npower RWE npower RWE npower Scottish & Southern Energy Scottish & Southern Energy Scottish Power Scottish Power Scottish & Southern Energy Coal Coal Coal/Oil Coal Coal Oil Coal Coal Coal Coal/Gas Coal Oil Oil Coal Coal Coal Coal Coal Coal
1 Compliant with LCPD emission limits (Drax, Eggboroughand Longannet in NERP). 2 Limitation of operating hours to 20,000 between Jan. 1, 2008 and Dec. 31, 2015. No requirement to fit FGD. 3 FGD: flue gas desulphurisation. Source: DECC (DUKES).
RWE Facts & Figures | Updated September 2012
81
ORGANISATION
MARKET DATA
RWE
The German Energy Industry Act: regulating grid access and grid fees in the electricity and gas markets
Exploration/ generation
Competition
Retail
Distribution federal states (electricity and gas: ca. 1,200) Competition
Customers
82
ORGANISATION
MARKET DATA
RWE
The German Energy Industry Act: unbundling in the German energy grids (3rd Energy Package)
OU3 or ISO4/ ITO5 Obligatory TSO1 Legal unbundling Obligatory Functional unbundling Obligatory
Detailed rules to unbundle staff (ITO: more restrictive), equal treatment programme, distinctive branding
Obligatory
Detailed rules to unbundle staff, equal treatment programme, distinctive branding
83
ORGANISATION
MARKET DATA
RWE
The German Energy Industry Act: key elements of grid fee calculation (I)
Investments before / since 2006
in % Electricity Gas Electricity & Gas Electricity & Gas
Framework conditions
> There is an ex ante approval of the revenue caps, but no ex ante approval of the grid fees which can be checked ex post by the Federal Network Agency. RoE The permitted proportion of equity-financed assets is restricted to 40% Current cost accounting for rate of return and imputed depreciation will continue to apply for all investments before December 31, 2005 All investments as from January 1, 2006, will yield interest based on the method of inflationadjusted historic cost accounting and be subjected to imputed depreciation Tax treatment: Recognition of corporation taxes since incentive regulation has become effective (2009). Reflected in higher RoE Full recognition of trade tax (pass-through)
>
>
Allowed RoE 2005-2008 Allowed RoE 1st period1 Allowed RoE 2nd period2
84
ORGANISATION
MARKET DATA
RWE
The German Energy Industry Act: key elements of grid fee calculation (II)
Conditions for incentive-based regulation > Returns on equity: 7.14% for existing electricity and gas assets and 9.05% for new investments in the second regulatory period. > Special treatment of investment in growth and restructuring Fast-track treatment of large budgeted growth investment projects by the regulator to ensure adequate and timely remuneration for utilities. But mostly applicable only for transmission system operators. Distribution system operators can adjust the revenue cap by an expansion factor which covers the sustainable expansion of the networks within the regulatory period. > Average efficiency of German electricity distribution companies estimated at 94% indicating average company-specific efficiency targets of only 0.6% p.a. ("individual x factor") in the first regulatory period (in the second regulatory period the individual inefficiency has to be eliminated by the end of the period). > Quality component has been established during the first period: electricity distribution companies with a comparable high quality level get a bonus, companies with a low quality get a penalty. Opportunities and risks are limited by a cap.
85
ORGANISATION
MARKET DATA
RWE
Efficient cost and revenue management is key to determining the profit earned by grid operations
Revenue cap Revenue cap
Permissible costs costs in in 2008 2008 based based on on 2006 2006 Permissible
4
Annual percentage revenue adjustment
3
Cannot be influenced for the time being Deduction resulting from the cost audit Inefficient costs in 2006 determined via benchmarking reduced after second regulatory period
2011 costs
1 2
2006
1st
2011
electricity regulation period 2009 2013 2nd
2016
electricity regulation period 2014 2018
RWE Facts & Figures | Updated September 2012
86
ORGANISATION
MARKET DATA
RWE
1 2
Cost reviews: elimination of elements unique to the reference year. Determination of the efficiency figure: based on total cost benchmarking (TOTEX) against other grid operators. Annual percent adjustment of costs that can be influenced (inefficient costs): Consumer Price Index minus x factor (CPI-X) and the expansion factor for the integration of renewables, among other things. Annual adjustment of costs that can never be influenced (non-influenceable costs): upstream grid/avoided grid fees, investment measures, incidental staff costs, etc.
Revenue may rise and fall: incentive-based regulation is not a one-way street.
87
ORGANISATION
MARKET DATA
RWE
>
>
88
ORGANISATION
MARKET DATA
RWE
Source: Network development plan Electricity 2012, 2nd draft, Federal Network Agency.
RWE Facts & Figures | Updated September 2012
89
ORGANISATION
MARKET DATA
RWE
Number of sensitive network situations and redispatchvolume ( 13.1 EnWG)1 in winter 2011/2012
Grid element Number of hours 2,000 326 308 212 177 102 57 50 MWh Change vs. winter 2010/2011 148% 78% 30,800% 523% 17,700% 10,200% 5,700% -35%
Remptendorf Hradec
Number of hours in which measures according to 13.1 no. 2 EnWG (Energy Industry Act) were taken
200
< 400
1 According to 13.1 of the German Energy Industry Act, network or market-related measures (e.g. redispatch) are employed if uninterrupted supply is threatened. Source: Federal Network Agency.
RWE Facts & Figures | Updated September 2012
90
Organisation
Market data
RWE
Market data
92 133 Electricity Gas
91
Organisation
Market data
RWE
Electricity
93 113 115 118 121 Generation Fuels Trading Grid Supply
92
ORGANISATION
POLITICAL ENVIRONMENT
RWE
bn kWh
Nuclear Hydro Wind Gas Oil Coal/lignite Other Total net power generation
6 5 5 2 113 144 52 57 25 15 292 145 228 364 12 77 549 583 57 35 27 287 5 79 37 68 93 42
0 0%
20 20%
40 40%
60 60%
80 80%
100 100%
100
200
300
400
500
600
93
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Capacity trends in 50 years of thermal power generation in Europe - Gas on the rise since 1993
Annual commissionings of thermal power generation capacities in the EU 27 in GW*)
Oil (43 GW) Year of commissioning >
1962
1972 1982
1972 1982
1972 1982
1972 1982
1972 1982
1992 2002
GW
1992 2002
GW
1992 2002
GW
1992 2002
GW
1992 2002
GW
2012 0 5 10 15
2012 0 5 10 15
2012 0 5 10 15
2012 0 5 10 15
2012 0 5 10 15
1 Adjusted net generation capacity. Sources: Platts Database, Worldwatch Institute, RWE, 2012.
94
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Germanys generation portfolio is overaged: >15 GW already online longer than originally scheduled
Age structure of Germanys fossil-fuelled power plants
GW 12
Originally planned service life
10 8 6 4 2 0 >50 >45 >40 >35 >30 >25 >20 >15 >10 >5 0-5 Age (in years)
gas / oil
hard coal
lignite
95
ORGANISATION
POLITICAL ENVIRONMENT
RWE
19%
Lignite
Renewables Other
11% 2%
Renewables
Other Rounding differences may occur. Source: Energy Balance Working Group, German Energy and Water Association, February 2012.
4%
96
ORGANISATION
POLITICAL ENVIRONMENT
RWE
97
ORGANISATION
POLITICAL ENVIRONMENT
RWE
98
ORGANISATION
POLITICAL ENVIRONMENT
RWE
3,112 bn kWh1
99
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Development of number of wind turbines and installed wind capacity in Germany (1990-2011)
30000 30,000
Installed wind capacity (MW) Number of wind turbines 25,000 25000
29,071 MW
20,000 20000
15,000 15000
10,000 10000
5,000 5000
22,297
0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Source: Federal Ministry for the Environment, Nature Conservation and Nuclear Safety, 2011.
2011
100
ORGANISATION
POLITICAL ENVIRONMENT
RWE
4,601
3,642
3,067
4,000 4000
3,276
1,627
976
801
684
684
486
141
127
53
Source: Federal Ministry for the Environment, Nature Conservation and Nuclear Safety, 2011.
RWE Facts & Figures | Updated September 2012
Hamburg
Berlin
101
ORGANISATION
POLITICAL ENVIRONMENT
RWE
25000 25,000
20,000 20000
15,000 15000
10,000 10000
0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Source: Federal Ministry for the Environment, Nature Conservation and Nuclear Safety, 2011.
2011
102
ORGANISATION
POLITICAL ENVIRONMENT
RWE
UK power price
Min. Hourly demand Max.
Power price
OCGT + CCGT
Peaking2
Power price
CCGT
Hard coal
10
20
30
40
50
60
70
80
90
100
10
20
30
40
50
60
70
80
90
100
> Large proportion of low marginal cost plant from nuclear, lignite, CHP and wind > Load factor for new coal plant somewhat higher in Germany than in the UK
1 Including renewables and CHP. 2 Oil, OCGT, hydro, etc.
> Higher share of high marginal cost plant > New gas plant in UK has significantly higher load factor than in Germany > New coal not economic as must be CCS-ready
103
ORGANISATION
POLITICAL ENVIRONMENT
RWE
CO2 reduction
g coal/kWh Use of fuel - 21% State of the art technology - 33% 45% 743 g CO2/kWh 320 g coal/kWh Steam power plant 700C technology About 50% 669 g CO2/kWh 288 g coal/kWh CCS technology2 But: Efficiency losses of 7 - 12% points - 40%
- 90%
2010
1 Average data for hard coal-fired power plants. 2 CCS: Carbon Capture and Storage. Source: VGB Tech, Electricity Generation Facts and Figures 2011/12.
2020
time
104
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Emsland
Krmmel
Grafenrheinfeld Gundremmingen B
31 Dec 2015 31 Dec 2017 31 Dec 2019 31 Dec 2021 4,058 MW 31 Dec 2022 4,039 MW
105
ORGANISATION
POLITICAL ENVIRONMENT
RWE
The merit order and aspects influencing its structure provide a better tool for looking at the dynamics of power plant portfolios
Illustrative The German merit order the marginal power plant principle
Min. Max.
> The operation of power plants follows the sequence of short-run marginal costs: the merit order > Due to low price elasticity of demand, prices in electricity markets are driven by the merit order structure > Margins depend primarily on the cost efficiency of the available supply, not on adequacy (marginal plant mechanism)
Market price
Nuclear
Lignite
Hard coal
Gas
Oil
Supplied capacity in MW
106
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Demand - wind
Demand
Market price
Nuclear
Lignite
Hard coal
Gas
Oil
Supplied capacity in MW
107
ORGANISATION
POLITICAL ENVIRONMENT
RWE
The CO2 cap-and-trade system has reduced the gap in the merit order between upper base-load and lower peak-load electricity
Change in German merit order due to CO2 Illustrative
Offer price
> Marginal costs for old lignite-fired power stations increased more than marginal costs for efficient hard coal plants > Marginal costs for old hard coal-fired power stations rose more compared to those of efficient gas-fired power stations > As this is a dynamic system with changing fuel price relations (e.g. gas vs. hard coal), it is difficult nevertheless to predict at which CO2 price levels a switch between the fuel types in the merit order would happen
Nuclear
Lignite
Hard coal
Gas
Oil
108
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Frequency
5s
30 s
15 min
1h
Primary
Secondary
...
Minute reserve 5s 30 s 15 min TSO1 Primary > Automatic control at the generator/turbine > E.g. thermal power plants 1 TSO: Transmission system operator. 2 BRP: Balance-responsible party.
RWE Facts & Figures | Updated September 2012
Hour reserve
1h BRP2 Secondary reserve > Automatic control by the TSO, load frequency control > E.g. pumped storage Minute reserve > Manual activation by TSO > Manual, e.g. thermal power plants
109
ORGANISATION
POLITICAL ENVIRONMENT
RWE
80 0000 75 70
0000
5000
65
5000
60
0000 Feb Aug May Sep Mar Nov Jan Jun Apr Jul Dec
110
2012
2011
2010
2009
2008
Source: ENTSO-E.
RWE Facts & Figures | Updated September 2012
Oct
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Sufficient electricity supply was only guaranteed on the basis of hardly any outages in the thermal generation fleet
GW 12
150 100 50 0
8 4 0
Solar Wind Hydro Thermal capacity Installed capacity Capacity not available Required balancing power1 German domestic consumption Net export balance Remaining spare capacity (<2 GW)
No relief through electricity imports during peak hours due to likewise high electricity demand in neighbouring countries: demand for electricity exports were higher than available imports
GW 6 5 Export (from Germany) Import (into Germany)
4 3 2 1 0
France
Austria
Swiss
Netherlands
Denmark
Poland
CZ
1 German TSOs have contracted approx. 5 GW of balancing power to cover short-term grid imbalances. Source: ENTSO-E, EEX, German Energy and Water Association; German electricity import/export on 8 February 2012, 6:00 7:00 p.m.
RWE Facts & Figures | Updated September 2012
111
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Scenarios
Starting point: ENTSO-Es Scenario B (January 19:00 pm)1 Development of capacity reserve margin considering... Scenario 1: ... only announced new build and most likely shut down of power plants
2012
2013
2014
2015
2016
2017
2018
2019
2020
Scenario 2: ... additionally to scenario 1: plus shut down of plants >50 years of lifetime Scenario 3: ... additionally to scenario 2: plus shut down of plants which are uneconomically according to RWE market model
1 Peak demand increased by 9 GW while reliable available capacity only by ~3 GW compared to System Adequacy Report 2011. Source: ENTSO-E (2012), RWE estimates (May 2012)
RWE Facts & Figures | Updated September 2012
112
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Main sea freight trading routes for hard coal in 2011 (I)
Seaborne hard coal trade in 2011: 978 million mt
32 101 91 To the Far East USA 80 CHINA 270 COLOMBIA/ VENEZUELA 67 API#4 SOUTH AFRICA API#3 AUSTRALIA INDONESIA
281
CANADA
API = All Publications Index. Source: German Coal Importers Association, Annual Report 2012, published in July 2012.
RWE Facts & Figures | Updated September 2012
113
ORGANISATION
POLITICAL ENVIRONMENT
RWE
API#2
API#3
API#4
API = All Publications Index. CIF = Cost, Insurance, Freight. CIS = Commonwealth of Independent States. FOB = Free On Board. The TFS API was a registered trade mark of the Tradition Financial Services Company (TFS). The TFS ascertains different API prices by a price survey from Argus Media and McCloskey. API Index was renamed from July 2005 on to AM API#... (A for Argus Media and M for McCloskey). Source: German Coal Importers Association, Annual Report 2012, published in July 2012.
RWE Facts & Figures | Updated September 2012
114
ORGANISATION
POLITICAL ENVIRONMENT
RWE
FINLAND
NORWAY
SWEDEN
DENMARK NETHERLANDS
GERMANY BELGIUM
FRANCE
AUSTRIA
115
ORGANISATION
POLITICAL ENVIRONMENT
RWE
All data represents year 2009; Electricity consumption for Romania, Serbia, Bulgaria and Greece derived from ENTSO-E; Other electricity consumption figures are derived from IEA and CIA; Natural gas consumption figures are derived from IEA and IHS.
RWE Facts & Figures | Updated September 2012
116
ORGANISATION
POLITICAL ENVIRONMENT
RWE
2001 2001
Germany
2002 2002
2003 2003
France France OTC
2004 2004
2005 2005
2006 2006
2007 2007
Spain
2008 2008
2009 2009
2010 2010
2011 2011
Scandinavia
Germany OTC
117
ORGANISATION
POLITICAL ENVIRONMENT
RWE
IS
NO
SE
EE LV
RU2
IE GB NL BE L
DK DK RU2
LT BY2 PL
DE CZ SK UA-W2
synchronous with the Baltic system from September 2010 in trial synchronous operation with the continental European system
3
UA2
FR
CH
AT HU SI RO HR BA RS BG MK AL1 GR
MD2
PT ES
IT
TR3
MA1
DZ1
TN1
CY
RWE Facts & Figures | Updated September 2012
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Amprion
TenneT
TransnetBW
119
ORGANISATION
POLITICAL ENVIRONMENT
RWE
2.95
SWEDEN
2.09
2.05
1.68 0.63
NETHERLANDS
1.24
POLAND
2.55
8.06
0.11
2.59
5.20
FRANCE
9.51 17.02
CZECH REPUBLIC
7.59
Export from Germany Import into Germany 1 2010 Figure. Source: www.netzentwicklungsplan.de, Amprion.
4.54
AUSTRIA
7.99 1
SWITZERLAND
RWE Facts & Figures | Updated September 2012
120
ORGANISATION
POLITICAL ENVIRONMENT
RWE
E.ON (GER) EdF (FRA) GDF SUEZ (FRA) RWE (GER) Iberdrola (ESP) Vattenfall (SWE) EnBW (GER) ENEL (ITA) 0
104 157 156 210 320 294 508
1,145
100
200
300
400
500
600
700
800
900
1000
1100
1200
1 Last completed fiscal year. Sales are excluding proprietary trading. Source: RWE analysis, August 2012.
121
ORGANISATION
POLITICAL ENVIRONMENT
RWE
532
500 400 120 300 16 200 254 100 0 8 2006 142
534
140
540 538
140 139
518
142
518
140
962
980
973
939
958 837
459
121 16
121 17
438
453
447
484
600 400 410 200 0 104 2006 115 2007 126 2008 118 2009 126 2010 386 360 330 348
365
255
252
352
9 2007
9 2008
120 2011
Residential and commercial customers2 Industry Power plants 2 Also includes transport and district heating.
1 Also includes public consumption. Source: German Energy and Water Association, 2012.
122
ORGANISATION
POLITICAL ENVIRONMENT
RWE
11.01 11.00 10.71 10.34 10.14 9.98 9.57 9.35 9.34 8.99 8.95 8.95 8.89 8.86 8.29 8.23 8.10 8.03 2
10
12
14
16
18
20
1 Basis: industrial customers with a consumption of 500 2,000 MWh; prices excluding value-added tax and all other recoverable taxes and levies. 2 Provisional data. Source: Eurostat, July 2012.
RWE Facts & Figures | Updated September 2012
123
ORGANISATION
POLITICAL ENVIRONMENT
RWE
EU 27
17.55 16.84 15.09 14.44 14.36 14.12 13.95 13.51 13.43 13.40 13.15 13.10 12.08 11.92 11.08 10.68 10.52 10.17 9.19 8.23 7.27
10
12
14
16
18
20
124
ORGANISATION
POLITICAL ENVIRONMENT
RWE
German households rank second in terms of state-caused charges on the electricity bills
%
Denmark Germany Portugal Sweden France Austria The Netherlands Finland Greece Spain Bulgaria Luxembourg Ireland UK 4.7 13.5 11.9 18 16.7 19.9 28.2 27.4 25.4 24.7 34.2 38.6 44.4 56.6
10
20
30
40
50
60
Source: Eurostat, 1st half of 2011 (average); prices incl. taxes, levies and fees, annual consumption of 2,500 5,000 kWh, German Energy and Water Association, November 2011.
RWE Facts & Figures | Updated September 2012
125
ORGANISATION
POLITICAL ENVIRONMENT
RWE
German industrial customers face highest state-caused charges on the electricity bills
%
Germany The Netherlands France Denmark Finland Portugal Greece Spain UK Luxembourg Bulgaria Sweden Ireland 0.7 0.4 1.5 4.8 4.4 4.3 6.7 9.3 8.9 11.8 15.0 18.0 27.9
10
15
20
25
30
Source: Eurostat, 1st half of 2011 (average); prices incl. taxes, levies and fees, annual consumption of 500 MWh 2,000 MWh, German Energy and Water Association, November 2011.
RWE Facts & Figures | Updated September 2012
126
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Competition has been a reality since 1999: freedom of choice for German residential electricity customers; increasing churn rates
Churn rate of electricity customers (accumulated)
Million customers 12
10 8.3 8 6 4.3 4 2 3.1
18.9% 8% 11% 20.7% 21.7%
11.20
7.4
27.7% 25.8% 24.6%
28.2%
Nov 2006
Nov 2007
Dec 2008
Oct 2009
Oct 2010
Apr 2011
Oct 2011
Mar 2012
Jun 12
127
ORGANISATION
POLITICAL ENVIRONMENT
RWE
+ 578% 23.1
0.15
23.7
0.13
17.1 11.9
0.77 2.30 2.22
6.9 4.1
0.26 2.00 1.82 0.61 0.90 2.05 3.36
8.5
0.99 1.15 2.04 4.32
9.5
0.67 1.63 2.08 5.10
11.4
0.76 1.91 2.15 6.53
12.3
0.85 2.92 2.07 6.46
12.9
0.79 3.73 2.09 6.27
13.5
0.70 4.30 2.14 6.35
13.8
0.52 4.88 2.17 6.26
14.3
0.63 5.27 2.16 6.28
0.45 8.33
13.53
14.11
5 0
6.60
7.15
6.82
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011 1
2012
German Combined Heat and Power Act German Renewable Energy Act2
1 Estimated figures. 2 Various sources. Source: German Energy and Water Association, April 2012.
128
ORGANISATION
POLITICAL ENVIRONMENT
RWE
150 122
24
149
122
21
129
38 29 39
95
4
90 65
10
96
21
104
21
20
19
69
13
74
13
23
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Taxes, levies & fees Renewable Energy Act, Combined Heat and Power Act, electricity tax Net electricity prices Generation, transmission and sales 1 Medium voltage, purchase of 500 kW/3,150h. Source: German Energy and Water Association, April 2011.
129
ORGANISATION
POLITICAL ENVIRONMENT
RWE
49.95
12.35
48.20 40.66
14.40 15.51 16.68
46.99 41.76
18.67
50.14
20.30
60.20
24.65
25.20
26.53
28.57
33.19
34.10
+ 176%
37.60
33.80
25.15
25.08
28.32
29.84
31.56
32.73
34.27
35.55
37.95
41.17
40.53
39.59
40.98
+ 9%
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Gains resulting from deregulation are being eroded by additional burdens imposed by policymakers
Source: German Energy and Water Association, April 2012.
RWE Facts & Figures | Updated September 2012
130
ORGANISATION
POLITICAL ENVIRONMENT
RWE
3.59
13.9%
45.4%
Electricity tax Concession fee Combined Heat and Power Act 1 3,500 kWh/a. 2 VAT at 19%. Source: German Energy and Water Association, April 2012. Rounding differences may occur. 2.05 1.79 0.15 8.0% 6.9% 0.6%
131
ORGANISATION
POLITICAL ENVIRONMENT
RWE
150
100
62.9
50
31.8 14.9 17.0
47.8 33.7
0
Germany Denmark Austria Netherlands Italy France Portugal Finland
132
Organisation
Market data
RWE
Gas
134 136 138 140 141 145 146 Trading LNG Storage Downstream Supply Turkish market Czech market
133
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Gas markets develop and are becoming global flexibility becomes key success factor
Gas trade flows 2011 billion m3
> Gas supply and pricing structures change > International LNG further growing: Linking European, American and Asian gas markets > Liquidity of European gas markets rising with gas prices increasingly volatile > Shift of key success factor: From volume creates value to flexibility creates value
Source: BP (2012).
134
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Lan g ele
Europipe 1+2
ipe
Franp
Zeepip e
DEUD AN
Ellund
BB
Balgzand Oude
Emden
Greifswald
NET RA
NETHERLANDS BELGIUM
GERMANY NCG/GPL
Blaregnies
LUXEMBOURG
FRANCE (PEG)
Obergailbach
CZECH REPUBLIC
WAG
No rd
Mallnow
SWITZERLAND
Tarvisio
AUSTRIA
Griesspass
St re am
ip Norp e
DENMARK
Baumgarten (CEGH)
135
ORGANISATION
POLITICAL ENVIRONMENT
RWE
5000 5,000 4000 4,000 3000 3,000 2000 2,000 1000 1,000
7% 10%
Asia Pacific Africa Middle East Europe and Eurasia South and Central America North America LNG
12%
0 2005
Source: PIRA, IEA.
2010
2020
136
ORGANISATION
POLITICAL ENVIRONMENT
RWE
LNG: 1 m3 at -162 C
Vessel transport volume (standard range): 135 155 thousand m3 LNG 81 93 million m3 regasified volume 495 565 thousand boe 0.9 1.0 bn kWh
Gas: 600 m3 at 15 C
Regasification Pipeline
Regasification terminal
Transport system
Power generation
137
ORGANISATION
POLITICAL ENVIRONMENT
RWE
21,297
14,747 11,900 4,744 4,350 6,330 3,127 2,760 2,785 5,000 2,325 0 5000 10,000 10000 15,000 15000 20,000 20000 5,000
515
153 200 55 86 72 52 28 39 145 24 0 100 200 300 400 500
10 15 5 6 5 8 8 1 3 1 0 10 20 30 40 50
EU 27: 124
138
ORGANISATION
POLITICAL ENVIRONMENT
RWE
POLAND
> Germanys underground gas storage facilities at 40 locations have a capacity of roughly 21 billion m3 of process gas. This represents roughly a quarter of the amount of gas used in Germany in 2011. Germanys gas industry thus has the largest storage capacity within the European Union. > A further 23 underground gas storage facilities with a working gas capacity of more than 11 billion m3 are either under construction or in the planning stage. This will cause the share of German annual gas consumption covered by available gas storage capacity to rise to about 40%.
NETHERLANDS
Dortmund
GERMANY
Cologne Erfurt Frankfurt
Leipzig Dresden
BELGIUM LUXEMBOURG
Saarbrcken
CZECH REPUBLIC
Nuremberg
Stuttgart
FRANCE
Freiburg Munich
AUSTRIA
139
ORGANISATION
POLITICAL ENVIRONMENT
RWE
E.ON (GER) ENI (ITA) Gasterra (NED) GDF SUEZ (FRA) Wintershall (GER) Gas Natural (ESP) RWE (GER) 0 200
322 396 462 572 954 1,064
1,342
400
600
800
1000
1200
1400
1 Last completed fiscal year. Sales are excluding proprietary trading. Source: RWE analysis, August 2012.
140
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Average gas price 1 Cooking, hot water and heating. Source: Eurostat 2012; average prices for 2011; based on purchasing power standards.
RWE Facts & Figures | Updated September 2012
141
ORGANISATION
POLITICAL ENVIRONMENT
RWE
German residential gas prices from 2000 to 2011 compared with other European countries
All-gas household: annual consumption: 23,500 kWh1
ct/kWh (incl. taxes)
10 9 8 7 6 5
Belgium
4 3 2 1 0 2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
1 Cooking, hot water and heating; 5,560 55,560 kWh after second half of 2007. Source: Eurostat, 2011.
RWE Facts & Figures | Updated September 2012
142
ORGANISATION
POLITICAL ENVIRONMENT
RWE
70%
Value-added tax
16%
8% 2% 4%
30% of the gas price1 payable by an all-gas household is allocable to taxes and levies
1 Example based on the average price per kWh for an all-gas household (as of 1.4.2011) with a basic supply contract. Source: Federal Network Agency (2012).
143
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Netherlands
223 bn kWh
21%
11% 9%
1 Preliminary figure, National includes bio gas. Source: German Energy and Water Association (BDEW), February 2012.
144
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Proven natural gas reserves million bcm Top ten countries Russia Iran Qatar Saudi Arabia USA Turkmenistan UAE Nigeria Venezuela Algeria
8 8 8 7 5 5 5
Azerbaijan 0.85 Iraq 3.2 Iran 29.6 Kuwait 1.8 Turkmenistan 7.5 Russia 44.8
45 30 25
QATAR 25.4
Caspian and Gulf total 70% of the world natural gas reserves
Bubble size is indicative of the size of reserves
145
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Relevant institutions and their role in the Czech gas market (I)
According to the Energy Law, the following three institutions are responsible for the execution of state control in the energy market: (1) Energy Regulatory Office (ERO) (2) State Energy Inspection Authority (3) Ministry of Industry and Trade There are also additional institutions that have a significant impact on the domestic energy market and its participants, including: (4) Market Operator (5) Office for the Protection of Competition (UOHS) ERO is an autonomous authority, which is responsible for the regulation of the Czech energy market. Among others, ERO > supports market competition, development of secondary and renewable energy sources, and the protection of energy consumers > grants and cancels licenses for activities related to the energy business > makes regulatory decisions regarding prices > resolves disputes between license holders or between customers and license holders > drafts and approves rules pertaining to the domestic energy market model
(1)
(2)
State Energy Inspection Authority is authorised to assess buyer and seller behaviour and recommend sanctions to ERO.
146
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Relevant institutions and their role in the Czech gas market (II)
(3)
Among others, the Ministry of Industry and Trade: > Issues state consent for the construction of selected gas infrastructure projects > Prepares the State Energy Concept, a document establishing the countrys long-term energy goals > Informs the European Commission of the countrys developments within the energy sector Market Operator provides comprehensive services to the energy sector, including: > Organisation of short-term gas and electricity markets in cooperation with the TSOs > Administration of the registry of greenhouse gas emissions trading > Financial settlement of imbalances in the gas and electricity systems > Provision of technical support for customer switching
(4)
(5)
UOHS is the central state administration authority responsible for establishing conditions that promote and safeguard competition, supervising public procurement as well as acting as advisor and supervisor for the provision of state aid.
147
ORGANISATION
POLITICAL ENVIRONMENT
RWE
148
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Nonregulated1
Regulated
Regulated
4 8%
70 80%
4 8%
15 20%
3 5%
Entity
Net4Gas
> External factors influence approx. 70 80% of the final price of natural gas
1 Prices are linked to other fuels (oil, fuel) or based on spot market. 2 Negotiated third-party access.
149
ORGANISATION
POLITICAL ENVIRONMENT
RWE
Costs
Inflation - X escalation (inflation is composed of the Consumer Price Index (CPI) with 1% premium and index of selected B2B services). Incentives stem from outperformance potential over the X-factor set by ERO.
Depreciation
The ERO defines the value, which forms the initial basis. Annual planned net investments are added to the basis. Ex-post corrections reflect actual net investments (DSO).
Unbundling
There are some residual allowed costs from previous regulatory periods related to the unbundling of system operators from vertically integrated companies (applied only in 2010).
Revaluation
For regulatory purposes, ERO currently acknowledges the restated depreciation of revalued assets (according to Czech accounting standards). However, the revaluation effected regulatory asset base only to a minor extent.
150
Organisation
Market data
RWE
RWE
152 Electricity 197 Gas 219 Investor Relations
151
Organisation
Market data
RWE
Electricity
153 184 187 189 190 Generation Fuels Trading Grid Supply
152
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
30
27
20
10
8 2
0 Germany
UK
1 Including contracted generation. 2 Countries included: CZ, HU, PL, SK. Source: Eurostat, ENTSO-E, RWE.
RWE Facts & Figures | Updated September 2012
153
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE's share of the German power generation market relative to peers (2011)
Total net electricity production (including self generators)
RWE E.ON 154.4 billion kWh 89.6 billion kWh 29% 17%
Vattenfall Europe
12%
11% 31%
154
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE Group electricity production by primary fuel and electricity purchases (2011)
Billion kWh
120
107.1
74.1
68.6
34.3
38.5
RWE power plants Electricity procured from power plants that are not owned by RWE that we can deploy at our discretion on the basis of long-term agreements 1 The difference between 312.8 billion kWh of power generation output and 294.6 billion kWh of electricity sales is due to grid losses and own use.
155
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
156
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Total: 31.3 GW
Others
> Long-term contracts relating to fossil-fired and hydro power plants > RWE has full entrepreneurial control over power plants > RWE can use most outside purchases until the end of the power plant's useful life > Pricing is largely dependent on generation costs (fuel, CO2)
RWE Facts & Figures | Updated September 2012
157
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Poland
RWE Power RWE Power RWE Power RWE Power VSE VSE EnviaM
Steag
49.0
1 As of 31 December 2011; rounding differences may occur on the power plant list.
158
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
MW Gas Emsland B, C, D Gersteinwerk F - I Gersteinwerk Werne Kv1 Weisweiler VGT G, H Bochum Dortmund GuD Dormagen GuD Dormagen Huckingen Huckingen LEW Aviko Swag Gas enviaM (various) RWN (various) RWE Vertrieb (various) Kevag (various) Total gas Oil Grokayna Sermuth Peissenberg (gas, oil) Total oil RWE Power RWE Power RWE Power RWE Power RWE Power RWE Power RWE Power RWE Power RWE Power RWE Power LEW Swag enviaM RWE RWN RWE Vertrieb Kevag 1973, 1974, 2010 1973 1984 2006 2004 2004 2000 2000 1975, 1976 1975, 1976 2000 1992-2001 1986-2009 1999-2011 2002-2011
1,826 100.0 1,285 100.0 112 100.0 544 100.0 21 100.0 12 100.0 326 100.0 260 100.0 314 100.0 292 100.0 10 100.0 8 100.0 352 various 2 100.0 2 100.0 0 100.0 5,365
43.0
50.0
1 As of 31 December 2011; rounding differences may occur on the power plant list.
159
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
42.5 68.7
Luxembourg
RWE Power RWE Power LEW Swag RWE RWN enviaM Kevag RWE RWN
1928
1992
12 5 169 17 5 10 0 0 218
12 100.0 5 50.0 157 Various 17 78.8 5 100.0 10 100.0 0 58.0 0 100.0 206
12 2 104 12 5 10 0 0 145
50.0 22.4
Stadt Dren
42.5 25.1
Renewables other Malchin (biomass oil) enviaM Bernkastel (Solar) RWE Power Landfill gas (various sites Various Biogas (various sites) enviaM Biomass-fired thermal power RWE RWN station Neubrcke Various Vegetable oil (various sites) Various Solar (various sites) RWE De. Biomethane RWE RWN BHKW Schllershamer (biogas) Total renewables other 1 Rounding differences may occur on the power plant list.
2003
2007-2011 2003
11 0 1 4 7 1 6 2 1 33
2005
25.05
1 As of 31 December 2011; rounding differences may occur on the power plant list.
160
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Austria
RWE Power RWE Power RWE Power RWE Power RWE Power RWE Power RWE Power RWE Power RWE Power Swag
2009
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0
3,0282 1,9862 8112 557 2 292 102 1602 8702 1,0962 12 Bioenergie Bottwartal 8,547 29,528
100.0
161
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Belgium
Essent Essent Essent Essent Essent Essent Essent Essent Essent Essent Essent Essent Essent Essent Essent
1972 1976 1995 1985 1996 1982 1988 2007 1996 1996 1995 1994 1999 1977
100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0
100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Essent
1989
11 11
100.0
11 11
100.0
11 11
1 As of 31 December 2011; rounding differences may occur on the power plant list.
162
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
0 0 0 0 0 0 0
0 0 0 0 3,144
163
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Ireland
RWE npower RWE npower RWE npower RWE npower RWE npower RWE npower RWE npower RWE npower
55 58 81 99 6 27 15 53 394
55 58 81 99 6 27 15 53 394
55 58 81 99 6 27 15 53 394
1982-84 1969-70
RWE npower
2011
100.0
100.0 100.0
1 As of 31 December 2011; rounding differences may occur on the power plant list.
164
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWEs Central Eastern and South Eastern Europe division's plant portfolio1
Power plant Country Operating company Commissioned Net capacity MW Hard coal TE Plomin 2 Total hard coal Lignite Mtra Total lignite Gas Mtra Sinergy (various sites) Total gas Renewables run-of-river MSZ Total renewables run-of-river Total CEE Division 1 As of 31 December 2011; rounding differences may occur on the power plant list. Croatia TE Plomin d.o.o. 2000 192 192 RWE's legal consolidation stake % 0.0 MW 0 0 % 0.0 RWE's Partner economic stake MW 0 HEP d.d. 0 Stake in % 50.0
Hungary
Mtra
1967
763 763
100.0
763 763
51.0
49.0
Hungary Hungary
Mtra Sinergy
2007 2000-2005
60 127 187
100.0 Various
60 87 147
51.0 Various
49.0
Hungary
2007
1 1 1,143
100.0
1 1 911
100.0
1 1 517
165
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
455 Various 201 100.0 5 0.0 9 0.0 10 0.0 34 0.0 6 0.0 22 0.0 20 0.0 17 0.0 10 0.0 8 0.0 7 0.0 10 0.0 2 0.0 48 0.0 92 0.0 32 0.0 60 0.0 5 100.0 5 100.0 16 100.0 4 100.0 3 100.0 90 100.0 60 100.0 19 100.0 9 100.0 10 100.0
3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3
66.7 66.7 66.7 66.7 66.7 66.7 66.7 66.7 66.7 66.7 66.7 66.7 66.7 66.7 66.7 66.7 66.7
49
1 As of 31 December 2011; rounding differences may occur on the power plant list. 2 Capacities of power plants not owned by RWE, but that RWE can deploy at its discretion on the basis of long-term agreements. 3 M&G Investment Management Limited, JPMorgan Investment Management Inc. RWE Facts & Figures | Updated September 2012
166
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
167
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Germany
RWE Innogy
1992
10 10
100.0
10 10
100.0
10 10
14 30 0 1 44
14 30 0 1 44
14 30 0 1 44
RWE Innogy RWE Innogy RWE Innogy RWE Innogy France Spain Spain RWE Innogy RWE Innogy RWE Innogy RWE Innogy RWE innogy RWE Innogy 1958-1989 1998-2000 1998 1996-2004 1993 2008
100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 0.0 0.0
100.0 78.0 100.0 100.0 100.0 100.0 60.0 82.4 32.3 39.4
22.0
INVESTERG (various sites) Portugal Ribadouro (INVESTERG) Portugal Vales (INVESTERG) Portugal Total renewables hydro run-of-river
1 As of 31 December 2011; rounding differences may occur on the power plant list. RWE Facts & Figures | Updated September 2012
168
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
49.0 49.0
66.7
Contractually secured plants AEW, Klingnau Switzerland Totally contractually secured plants Totally renewable energies Total RWE Group
RWE Innogy
37 37 2,681 50,777
0.0
23 23 2,430 49,239
62.5
23 23 2,356 47,283
1 As of 31 December 2011; rounding differences may occur. 2 Capacities of power plants not owned by RWE, but that RWE can deploy at its discretion on the basis of long-term agreements.
169
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
170
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Staythorpe Pembroke Didcot A Aberthaw B Didcot B Fawley 2,188 MW 1,958 MW 1,554 MW 1,420 MW 968 MW Great Yarmouth Little Barford Littlebrook D Tilbury B
171
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Name: Moerdijk II Place: Moerdijk Fuel: Gas Capacity: 426 MW Year of commission: 2012
Name: Amercentrale Place: Geertruidenberg Fuel: Coal, gas, biomass Capacity: 1,226 MW Year of commission: 1972-1993
Name: Swentibold Place: Geleen Fuel: Gas Capacity: 245 MW Year of commission: 1999
172
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
2.000
MW 3.000
2.000
2.000
~40% older than current average Existing RWE power plants New build projects Source: RWE.
~62% older than ~56% older than ~63% older than current average current average current average Average age excl. new build projects 1 Incl. capacities contracted in long-term agreements. Average age incl. new build projects 2 Westfalen D&E (COD 2013) 3 BoA 2&3 4 BoA 1 5 CCGT Lingen
RWE Facts & Figures | Updated September 2012
173
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Wind onshore
Biomass
Hydro
Maturity of technology
> Pioneer phase > Industry is making substantial progress > UK: growing > Germany, Netherlands, Belgium: emerging
> Mature
> Mature
Markets
> Germany, UK, Italy > Benelux: emerging > USA: growing (upstream pellets) > Market for fuel supply > Sustainability
Specialities
> Large scale hydro limited to few countries in Europe > Long run times > Average size >1 MW and all types
> Small to medium (5 80 MW) > 100k 750k ton/a pellet plant
35 40%
25 30%
80%
50%
174
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Biogas
Marine energy
Photovoltaic
Maturity of technology
> Spain, Italy, Greece, Turkey: growing > North Africa: potential
Markets
> Germany: growing in customer related smart PV plants > Mediterranean countries: growing > Capacity freely scalable
> Feedstock dependency > Feed-in into the grid > Small: 5 50 MW
57%
90%
25 35%
175
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Flexibility
MW
1.100
BoA plus
Max. capacity Min. capacity Max. change rate of load ~ 2x550 MW ~ 3501/1752 MW +/- 30 MW/min
1.000
50
BoA 1 to 3
800
Max. capacity ~ 1,000 MW Min. capacity ~ 500 MW Max. change rate of load +/- 30 MW/min
40 600 30
1975 Weisweiler: 600 MW = 1966 Frimmers- 36.6 dorf: 300 MW = 31.4 2003 Niederauem: BoA 1 1,000 MW > 43 far after 2020 700 CBoAplus 1,100 MW 50
400
20
200
Min.capacity2 Min.capacity2
10
10
15
20
25
30 Minutes
176
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
100
Frimmersdorf-Sd Frimmersdorf-West
80
Garzweiler I
Garzweiler II
60
40
20
Inden
0 1970
Sdrevier Zukunft-West
1980 1985 1990 1995 2000 2005
Inden I + II
2010 2015 2020
1975
10
11
3 Actual values
Number of mines
Mining capacity
177
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Mine premises Former mine premises being restored Restored mine premises Water Lignite-fired power plants Coal processing plant Approved mining area
A 46 Grevenbroich A 540
Erf t
Frimmersdorf Neurath A 61
Nord - Sd - Bahn
A 44 Bedburg
Niederauem Fortuna-Nord
A 61
Bergheim
Kln Cologne
Rhein
Sophienhhe A 44 Jlich
Tagebau Hambach
Ru r
Frechen A1 Wachtberg A4
47 7n
Tagebau Inden
Ha
hn ba ach mb
Hrth
E rft
Ville/Berrenrath Goldenbergwerk A 61
A 555
A4 Weisweiler
Brhl
As of January 2012.
Eschweiler
DB K ln -
Ind e
Aac hen
Dren
178
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Nuclear
34.3
120
116.6
Total: 205.7
Gas 38.5
100 80 60 40 20 45.3
8.8 2.2
Free allocation allocation Shortage of CO2 Free Shortage of CO2 certificates certificates
1 Including electricity procured from power plants not owned by RWE that we can deploy at our discretion on the basis of long-term agreements, amounting to 22.9 billion kWh, of which 20.8 billion kWh are from hard coal. 2 Includes power stations not owned by RWE that we can deploy at our discretion on the basis of long-term agreements. In 2011, they produced 20.4 million metric tons of CO2 and were allocated certificates for 18.9 million metric tons.
RWE Facts & Figures | Updated September 2012
179
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Final disposal
> In some cases, technical infrastructure needs to be > Materials and waste management (treatment, operated for an additional period conditioning, packaging) > For the time being, fuel elements are being cooled in pond storage facilities until they are suitable for dry-cask (CASTOR) storage on site > Systems no longer need to be shut down > Treatment of operating materials and waste
> Conventional > Final disposal of demolishing of decommissioning waste buildings/components which fall no longer under the German Nuclear Energy Act (AtG).
180
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Final disposal
181
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Nuclear provisions
Provisions are made for > Disposal of spent nuclear fuel assemblies Flasks, transport, conditioning, intermediate and final storage
RWE fiscal year 2011: 10,366 million 4,658 million 4,964 million 744 million
> Decommissioning of nuclear power plants Post-operation phase, dismantling, removal, final storage > Disposal of radioactive operating waste (e.g. cleaning cloths, oils, resins) Conditioning, flasks, intermediate and final storage
Inflation of current cost to the assumed disposal date by a set inflation rate; then discounting of the result back to today (discount rate 5.0%)
182
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Provisions IFRS
2010
2010
2011
2012
20..
183
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Colombia
42.6%
UK
15.6%
1 Data of RWE npower refer to purchase of hard coal, the rest refer to hard coal usage. Source: RWE.
184
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Use of lignite
Million metric tons
125 100.1
8.2
6.6 6.8 6.1 4.6
12.1
100
96.3
95.4
92.3
90.5
95.0
75
4.5 4,5
0 0
2006 2007 2008 2009 2010 2011
Source: RWE.
185
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Use of biomass
Metric tons
3 3.0
120
114
2.3
90
74
74
77
1.1 1 0.9 0.7
1.6
60
30
186
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE Supply & Trading acts as the interface between the RWE Group and global wholesale energy markets
Embedded lignite supply Power Gas Oil Coal Freight Weather Emission certificates Biomass Retail, small/medium sized industrials, municipals Sale of power and gas to end customers RWEs sales companies
> Back-to-back
procurement
2. Commercial Asset Optimisation > Commercial optimisation of assets, fuel supply and asset hedging on behalf of generating companies > Asset-backed trading activities > Reserve & balancing, ancillary services, face to TSOs1 Sale of power and gas
> Lock-in sales margin Sale of power > Bear volume and and gas credit risk
Options and emission certificates Industrial customers Sale of power, gas, emission certificates
187
3. Sales & Origination > Physical and financial customer business, principal investments, complex illiquid transactions and services > Internal/external back-to-back procurement 1 TSO = Transmission system operator.
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Electricity
billion kWh
1,435
Gas
billion m3
753
Oil
million bbl
618
CO2
million certificates
644
RWE Supply & Trading (Essen, Germany), is a leading European energy trading house for all commodities, in both their physical and/or derivative forms. As one of Europes strongest competitors in the gas industry, we optimise RWEs entire non-regulated gas business. Our headquarters boast Europes largest energy trading floor, complementing additional sites in Europe, the Middle East, Asia and the Americas.
RWE Facts & Figures | Updated September 2012
188
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE2
Osnabrueck
1 Preliminary figures. Source: BDEW. 2 12/2011 figures. Source: RWE Deutschland AG.
Koblenz
Frankfurt am Main
Saarbruecken
Ludwigsburg
Stuttgart Munich
189
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
15 12
14 8 5 3 2 Czech Rep.
10
Slovakia
Austria
Poland
Belgium
190
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
2,178 897
191
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
1 Net of electricity purchased from third parties 2 Difference between electricity production and electricity sales volume due to grid losses, own consumption of lignite production and pumped-storage power plants.
192
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Distributors
51%
193
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Distributors
24%
194
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Receiver1
Radiator thermostat Adapter plug
Configuration
Sensors1 Database
Apps/ Services
195
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Entertainment
Security
Home automation
Electromobility
196
Organisation
Market data
RWE
Gas
198 207 209 212 Upstream Storage Trading Downstream
197
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Licensing
96 thousand km2
> Seismic Exploration > Data processing > Drilling (dry wells) Expenses 2011 RWE Dea 123 million
> Drilling1 Development > Engineering > Construction (field and infrastructure) Capex 2011 RWE Dea 687 million
32 million boe
198
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Commercial
Reserves
C1 C2 C3 S1
1P Proved
2P Proved + Probable
Subcommercial
Low estimate S2
Best estimate
High estimate
Discovered (contingent)
Resources
C-Reserves
S-Resources
RWE Facts & Figures | Updated September 2012
199
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
1,000
993
1,018
1,046
1000
800
800
354
355
431
497
477
473
182 615 291
301
663
298
200 200
196 179
0 0
2011
2015e
Natural gas resources Natural gas reserves Reserves = proved + probable. Resources = S1 + S2.
200
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Europe/CIS
25%
Germany
15%
201
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
57%
Germany
16%
Europe/CIS2
27%
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE Dea gas and oil production target: increase of annual volume to 40 million boe1 by 2014
Annual gas/oil production (million boe1)
CAGR ~ 9%
40
20
Gas
0
2011
2014
Oil
> The focus is organic growth by exploration and development of discovered resources, i.e. conversion of resources into reserves > RWE Dea is targeting to increase production to 40 million boe1 by 2014 through defined development projects > RWE Dea aims to double the production within this decade
1 boe = barrel of oil equivalent.
RWE Facts & Figures | Updated September 2012
203
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Investment in international & organic growth: RWE Deas capex plan per region
million 2011 Germany 82 Average p.a. 2012 2016 Approx. 100 Gas: further production wells and compression facilities Oil: further production wells in Mittelplate offshore field UK: Southern North Sea (e.g. Breagh) Norway: Barents Sea; Norwegian Sea Caspian Region: Exploration / New ventures
North Africa
168
Approx. 400 Egypt: Disouq onshore development, offshore Nile Delta Libya, Algeria Approx. 900
687
Additionally approx. 150 million p.a. exploration expenses (G&G, dry holes) in 201216 (not including successful exploration wells being capitalized)
204
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Germany > Mature region > RWE Dea holds strong position in oil and gas production and gas storage > Objective: Stabilise production North Africa > High potential region > RWE Dea holds position in reserves in Egypt, Algeria and Libya > Objective: Boost gas field development in Egypt and Algeria CEE1 / Eastern NV2 > High potential region > RWE Dea holds licenses in Poland and Turkmenistan > Objective: Identify and assess projects in the Caspian Region to further establish an upstream position Exploration and production Exploration Trinidad / NV > High potential region > RWE Dea holds license in Trinidad > Objective: Carry on exploration work and build up further license positions 1 Central and Eastern Europe. 2 Eastern new ventures (e.g. Caspian Region).
RWE Facts & Figures | Updated September 2012
Turkmenistan
Algeria Mauretania
Libya
Egypt
205
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Production start
2012 2013 2014 2015 2016 2017 2018
1 2 3 4
RWEs share in capex. Budget doubling mainly due to rounding. Formerly Luno. Formerly Jordbr.
206
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Hje Xanten
GERMANY
Lobodice Tanovice
Stafurt
tramberk
CZECH REPUBLIC
207
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWEs existing gas storage capacity: A total of some 6.4 billion cubic meters
Working gas volume (bcm) Doln Dunajovice SSO Czech Republic Hje Lobodice tramberk Tanovice Tvrdonice Epe H-gas SSO Germany Epe L-gas Kalle Stafurt Xanten Breitbrunn/ Eggsttt RWE Dea Inzenham Wolfersberg Total 0.459 0.533 0.215 0.353 0.185 1.080 0.500 0.365 6.366 870,000 400,000 450,000 550,000 280,000 520,000 300,000 240,000 5,285,000
+ to up 0.6 +u 0.5 o t p
2.676
1,675,000
208
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE Supply & Trading: Full integration of RWE Groups gas midstream and trading activities
Consolidation, optimization and growth platform for RWE's unregulated gas midstream and trading business > Gas procurement for RWEs Pan European sales operations
External & internal purchasing contracts and arrangements
Traded markets
> Gas procurement for RWE Power's power plants > Gas Portfolio Optimization > Commercial responsibility for all liquefied natural gas (LNG) activities > Gas transport, transit and storage optimization > Functional responsibility for gas trading > Optimization of RWE OPCOs positions (e.g. management of gas sales for RWE Dea)
Upstream producers
Downstream business in NW Europe (incl. RWE Vertrieb and Essent) & Central Eastern European markets
209
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWEs long-term oil-indexed gas purchase portfolio at the end of the relevant year Already achieved reduction of the oil-indexed share of RWEs gas purchase portfolio
> RWE and Statoil have reached an agreement on the outstanding gas contracts including a gradual adjustment of the contract price towards the prevailing market conditions and compensation for the historic period since the start of the renegotiations > Including the settlement with Statoil in June 2012 we have renegotiated more than 50% of our oil-indexed contract volumes since 2009. We are still in the price review process with two gas suppliers with a total volume of approx. 11 bcm p.a.
210
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
OTC
NBP (UK) TTF (NL) NCG/Gaspool (GER) PEG (F) CEGH (A) PSV (I) AOC (E) GTF (DK) Area D (N)
211
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
100 80 60 40 20 0
Germany Belgium / Netherlands Belgium/ Netherlands UK CZ Hungary Slovakia
46
14 4
15
17
Germany
UK
Czech Republic1
Hungary1
Slovakia1
212
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
213
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
29%
58%
Distributors
38%
33%
42%
214
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
5%
47%
Distributors
8%
95%
46%
215
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Germany Residential and commercial customers Industrial and corporate customers Distributors Total 27.5 40.8 56.6 124.9
216
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
Gas transmission system Very-high pressure system Compressor station Border transfer station Inland transfer station
HPS Olbernhau
Hradec Krlov
CZECH REPUBLIC
SB Lobodice
Transfer and metering station Underground storage facility Headquarters of regional distribution companies
Brno CS Kralice CS Strovice CS Vesel n. L. CS Hostim esk Bud jovice SF D. Dunajovice CS Beclav SF Tvrdonice HPS Lanhot
SLOVAKIA
AUSTRIA
> In the Czech Republic, RWE holds the exclusive license for transmission and licenses for the storage and distribution of natural gas
217
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
RWE ENERGIE PP ZP
VP
CZECH REPUBLIC
SMP
JMP JP
SLOVAKIA
AUSTRIA
> Total number of gas customers in 2011: approx. 2.0 million > Gas consumption in 2011 by segment: key account: 27%; business: 26%; retail: 47% > In 2010, RWE CZ entered the electricity market. Total number of electricity customers amounted to 130,000 in 2011
RWE Facts & Figures | Updated September 2012
218
ORGANISATION
POLITICAL ENVIRONMENT
MARKET DATA
219