Bloomberg: RWE Shuts Fifth of German Gas Power Capacity as Profit Drops

RWE AG, Germany’s second-largest utility, closed almost a fifth of its natural gas-fired power capacity in Germany as low demand for electricity made the plants unprofitable.

A total of 954 megawatts of German gas-fed generation will be offline until at least the end of next year, the Essen-based company said in a filing on Aug. 9. That compares with gas-fired capacity of 5,228 megawatts in Germany at the end of 2011, according to a company presentation.

Increased generation from renewable sources such as wind and solar and a slump in German power prices has cut the income from gas-fired plants run by utilities including EON SE, the nation’s biggest utility. The so-called clean-spark spread, a measure of profitability for the next year based on electricity, emissions and gas prices, dropped to a record minus 19.61 euros a megawatt-hour on Aug. 6, compared with minus 8.05 euros a year earlier, according to data compiled by Bloomberg.  MORE