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German renewables traders eye growth on rising capacity

(Montel) Germany’s green power trading houses have suffered from rising costs in the wake of record-breaking commodities prices but are eyeing growth opportunities amid rising capacity, a Montel survey of companies showed this week.

“For us, as a direct marketer of renewable power, the significantly higher price levels have substantial negative consequences,” Thomas Krings, managing director of Germany’s Quadra Energy, told Montel. The company holds a green marketing portfolio of 8.7 GW.

He said even slight changes in weather forecasts would lead to significantly higher costs for rebalancing positions in the market.

The shake-up of energy markets last year since Russia’s invasion of Ukraine and skyrocketing costs – with Germany’s front-year power contract hitting an all-time high of EUR 1,050/MWh last August – altered the landscape of Germany’s subsidised marketing of green power.

Statkraft, which was the market leader from 2012-2022, shrunk its portfolio by 1.9 GW on the year to 9.2 GW in early 2023, the survey showed.

Higher costs

Statkraft spokeswoman Judith Tranninger pointed to higher trading and balancing costs prompting a change in risk management, which led to the capacity decline.

While other direct marketers cancelled contracts and cleaned their portfolios, Germany’s ENBW saw a green marketing portfolio rise of 3 GW on the year to 10.7 GW and has gained the top position in the field.

“Direct marketers who got out of old contracts last year should actually consider themselves lucky, as the costs associated with them have multiplied," said Amani Joas, one of the founders of CF Flex Power, a trading house set up last year.

The company has gathered a green marketing portfolio of 110 MW since then, Joas said. “We’re still smaller than we thought in the beginning. By the end of the year, we aim to reach the 600 MW region,” he added.

Expansion plans

Others said they were looking for growth as well.

“With rising growth rates of renewables capacities, we expect our portfolio to rise,” said Nicole Teschauer of BayWa Re, which currently holds a portfolio of 6.2 GW in Germany’s subsidised market premium scheme.

She pointed to Germany’s plans to expand renewables capacities over the coming years, with an expected doubling of onshore wind power capacities to 115 GW by 2030, near quadrupling of offshore wind capacities to 30 GW, and more than tripling of solar capacities to 215 GW.

Participation in Germany’s direct marketing scheme for renewables was last seen at roughly 83 GW, TSO data showed on Tuesday.