Corporate | 28 November 2013 15:20
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2G Energy AG / Key word(s): Market Report/Market Report
Corporate News 2G Energy AG: Coalition agreement confirms CHPs’ energy supply position – New regulation on EEG levy offers opportunities for CHP – Statutory protection for existing EEG feed-in compensation and existing own electricity generation – Initial draft reform EEG legislation by as early as Easter 2014 – Storage research subsidies as with power-to-gas – Feed-in precedence for renewable energies to be retained Heek, November 28, 2013 – The significance of combined heat and power (CHP) is set to grow as part of the energy policy transition in Germany. 2G Energy AG (ISIN DE000A0HL8N9), one of the leading German manufacturers of combined heat and power plants, is assuming on the basis of information available today that the regulatory conditions and market opportunities for CHP systems in Germany, as outlined in the coalition agreement, will remain stable. The same also applies for the markets for natural gas and biogas driven CHPs that 2G addresses. In their coalition agreement presented yesterday, the future CDU/CSU and SPD governing parties described the first important key aspects of the further structuring of the energy transition. In connection with maintaining supply security the future federal government has declared that (quotation): ‘. it should remain possible to operate the necessary capacities of conventional and flexibly-deployable power plants in an economically viable manner.’ As far as natural gas-driven CHPs are concerned, this can create opportunities for 2G to tap additional market demand potentials, especially on the part of major energy utilities, municipal utilities and energy contractors (IPPs). The coalition partners have confirmed their objective of expanding CHPs’ share of electricity generation to 25 % by 2020 – compared with 15 % today. This is equivalent to approximately 70 % growth potential over the next seven years. The coalition agreement specifically sets out a new government’s intention of (quotation): ‘in order to [implement] the EU Energy Efficiency Directive [.] into German law so that the opportunities included therein favor the recognition of the benefits of CHP and utility-supplied heating with regard to primary energy and CO2 emissions reductions compared with other heating systems.’ For 2G, this could bolster demand from the housing sector and local communities, especially in the 20 kW to 50 kW output range.
As far as the fundamental reform of the German Renewable Energies Act (EEG) is concerned, the restructuring of the EEG levy plays a decisive role in allowing the future coalition to place a brake on existing cost growth. The agreement states that the ‘Special Equalization Scheme’ is to be restricted to electricity-intensive companies facing international competition, and that a balanced regulation for own electricity production is to be created. With regard to 2G’s CHPs, this means that, with a more restrictive treatment of privileged status, many companies will be required to pay an EEG levy again. This could make investments in predominately natural gas-driven CHPs economically attractive. It remains to be seen how the aforementioned minimum levy for producers of their own electricity will be structured. The coalition partners have nevertheless committed themselves to the following (quotation): ‘. to maintain the economic efficiency, especially that of CHP plants and the utilization of raw materials process gases. A de minimis limit is to be included for smaller plants. Legal protection for existing own generation is to be ensured.’
When energy utilities, municipal utilities, IPPs and industrial companies review purchases of CHPs from the perspective of economic efficiency – besides energy costs – especially the utilization of thermal energy, the benefits of decentralized supply, flexibility and manageability are relevant decision-making criteria.
With regard to the biogas plant area, the agreement sets out, firstly, a prioritization of waste and residues as biomass for new plants. Secondly, it demands for existing plants an operating approach that is geared to demand as far as possible, in order to exploit the benefits for system stability. The greater flexibility that this necessitates is to be accompanied by boosting existing biogas power plant capacity in the repowering area. Consequently, biogas plants would emerge from their economic, baseload-dominated ‘insularity’, thereby tapping their potential as a standard energy variable.
Given a growing renewable energies share, the coalition agreement also raises the prospective necessity of storage units to offset seasonal volatilities, pointing to the potential offered by power-to-gas. Research programs in this direction are to be consolidated. 2G is active as a partner in such a research project together with the industrial gas group Linde, the wind power company Enertrag and Total oil group. This project aims to set up and operate a wind hydrogen production plant with an integrated and CO2-neutral public hydrogen fuelling station at Berlin-Brandenburg airport. Hydrogen generated from wind-powered energy is to be utilized as a fuel the first time. To this end, 2G has supplied a CHP (agenitor 306) with up to 120 kW electric output that achieves up to 41 % electric efficiency. With the adaptation of its highly-developed motor technology to hydrogen fuel, 2G is collecting important empirical data in this still-young technology field, and is positioning itself as an expert technology provider. As the second pillar of a sustainable energy policy transition, the agreement between the future government parties envisages placing a particular focus on energy efficiency. With a cross-sector approach that spans buildings, industry, business and households, it aims to treat electricity, heating and cooling on an equal basis. Today, 2G’s CHPs are already capable of making a significant contribution in this context with total efficiencies of between 85 % and up to 100 % in many of the aforementioned application spectrums.
2G Energy AG company profile
In the context of Germany’s new energy policy, CHPs within smart grids – so-called virtual power plants – are becoming rapidly important due to their predictable availability. 2G Energy (ISIN DE000A0HL8N9) is listed in the Entry Standard of Deutsche Börse AG. The share capital amounts to EUR 4,430,000, and is split into 4,430,000 shares. As of June 30, 2013, the company’s founders held 56.0% of the shares, with the free float amounting to 44.0%. In the 2012 financial year (January 1 to December 31), 2G Energy generated EUR 146.5 million of revenue, EUR 16.6 million of earnings before interest and tax (EBIT), and EUR 11.3 million of net income. The company currently employs 486 staff.
Forthcoming dates in 2013
Further information: www.2-g.de
IR contact
End of Corporate News 28.11.2013 Dissemination of a Corporate News, transmitted by DGAP – a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. DGAP’s Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de |
| Language: | English | |
| Company: | 2G Energy AG | |
| Benzstr. 3 | ||
| 48619 Heek | ||
| Germany | ||
| Phone: | +49 (0)2568-9347-0 | |
| Fax: | +49 (0)2568-9347-15 | |
| E-mail: | service@2-g.de | |
| Internet: | www.2-g.de | |
| ISIN: | DE000A0HL8N9 | |
| WKN: | A0HL8N | |
| Listed: | Freiverkehr in Berlin, Düsseldorf, Stuttgart; Frankfurt in Open Market (Entry Standard) | |
| End of News | DGAP News-Service |
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