May 26th, 2016
The Solar Future NL 2016
Introductory Remarks Paul Nillesen The Solar Future NL 2016
How to lose half a trillion… Major European utilities have lost 60% of their value in a decade Market Cap Development of key European Energy Producers Peak value (since 2006) vs. April 2016 €106 bn €17 bn
-84% €158 bn
€20 bn €56 bn €7 bn
€95 bn €59 bn €15 bn €6 bn
€400bn market cap gone in less than a decade
-87%
€33 bn €38 bn
-87%
-65%
-37%
-56%
€29 bn €11 bn
-63%
€53 bn €39 bn
Peak
-27%
Apr. 2016
€5mln per hour for a decade
Source: Thomson Reuters, Strategy& analysis
Strategy& | PwC
1
Coal is the winner in current market conditions‌ Projected gas margins show no sign of improvement up to 2020 Negative gas margins since 2011
Gas and Coal Power Generation Margins Clean Spark Spread and Clean Dark Spread EUR/MWh1)
12 Strategy& Projection Based on forwards
10 8
Coal margin (40%)
6 4 2 0 2010 -2
2011
2012
2013
-4
2014
2015
2016
2017
2018
2019
Gas Margin (58%) 2020
Gas Margin (50%)
-6 Note: 1) Annual average, corrected for CO2 prices. Source: Thomson Reuters, Strategy& analysis
Strategy& | PwC
2
Coal has become 50% cheaper in 5 years’ time Gas has become cheaper, but coal even more so Dutch Gas and Coal Prices Monthly Fuel Prices, Indexed Jan 2010 = 100
250
Gas = 2010 Coal = -50%
200
150
Gas (TTF)
100
50
Coal (ARA)
0 2010
2011
2012
2013
2014
2015
2016
Source: Thomson Reuters, Strategy& analysis
Strategy& | PwC
3