RWE Closes Power Plants in Germany, Netherlands

Germany’s RWE is planning to take power stations offline, adjusting to the lower margins due to the boom in solar energy, weak European electricity demand and lower power prices. 

‘Due to the continuing boom in solar energy, many power station throughout the sector and across Europe are no longer profitable to operate. During the first half of 2013, the Conventional Power Generation Division’s operating results fell by almost two-thirds,’ reads a note released on Wednesday. 

RWE operating profit for conventional power generation fell by 62% to  €690 million ($915 million) in the first half from a year earlier.

‘The massive reduction in power station margins is a major factor in this development. RWE can still benefit from the fact that it sold most of its electricity production two to three years in advance on the forward market at prices that were higher than they are now,’ reads the note.

The Group has decided to take a total of 3,100 MW of generation capacity offline in Germany and the Netherlands.

RWE published the first-half financial results, reporting a 19% rise in profit after arbitration made gas supply contracts with Russia’s Gazprom more favourable.