German Power Sector In Massive Trauma As Electricity Giant EON Set To Post Colossal €12.4 BILLION Loss!

German Power Sector In Massive Trauma As Electricity Giant EON Set To Post Colossal €12.4 BILLION Loss!:

The ‘Energiewende’ (transition to green energies) risks leading to a complete meltdown of Germany’s power generation sector.

The latest news is that German electricity giant Eon expects to post a massive 12.4 billion euro loss for the year 2016, NTV news site writes here. Careful not to link the loss to Germany’s failing renewable energy bid, NTV blames it on Eon subsidiary Uniper and its write-downs for “spun-off nuclear power plant business” and the “strongly fallen wholesale power prices“.

Eon share prices plummeted from €7.57 a share earlier this weak to €6.98 by early Thursday morning, before clawing back up to €7.15 in Friday trading.

The figure is only a preliminary estimate, and the final figure will be released on March 15. But the Handelsblatt writes that the loss could even be higher: “It’s going to be even higher,” say those within the company.

The Handelsblatt reports that “at least 1000 jobs” are planned to be slashed by Eon in an effort to get the cost situation under control.

Massive financial trauma

Just days ago NTZ wrote here that another of Germany’s major power producers, RWE, also posted staggering losses of 5.7 billion euros.

Eon’s latest loss comes in the wake of a 7-billion euro loss the German power giant posted a year earlier, in 2015.

Once steady makers of profits and providers of solid, high-paying technical and engineering jobs, Germany’s traditional power industry has been bleeding profusely since the Energiewende (transition to renewable energies) has really took hold. Jobs have been lost by the thousands.

The German power grid used to be considered as one of the most stable worldwide, providing low-cost and reliable electricity to consumers, but has since deteriorated due to distorted market conditions and the wildly fluctuating wind and solar power that is required to be fed in.

H/t reader kevin a.

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