Serbia exclusive: EPS electricity trading report: Successful winter season in electricity trade, Trade brought 8.5 million EUR

14. April 2014. / News Serbia Energy

At the free market, PE EPS bought less than planned, and sold 384 million kWh although the sale was not planned at all. In wholesale electricity trade PE “Electric Power Industry of Serbia” made profit last winter and  it did not have the planned and usual expenditure with which they have been finishing the heating season in Serbia for decades.

The winter was warmer than average for this area, moreover, with the average trimester temperature of 5.3 degrees, it was the second warmest winter since the beginning of temperature measurements, but that was not the only reason for excellent results in financial transactions. The necessary techno-economic background for the excellent result was complemented by the reliable operation of the production capacities of EPS, as well as by planned balancing of the Electric Power Portfolio, while all electricity needs in Serbia were being met continually and securely.

Successful trader 

Hence, it is not too much to say that in wholesale, i.e. at the free market, this winter PE EPS proved to be really successful trader. This success marked the whole business year of 2013 which PE EPS finished with the profit of 19 billion RSD, although the Business plan for that year envisaged the loss of 22 billion RSD.  Out of record production of 37.4 billion kWh, at yearly level, 3.3 billion kWh were sold at the free market, and the revenue from that sale was some 142 million EUR.

Good hydrology, reliable operation of production capacities and lucrative trade, along with significant rationalization of the costs, provided for the profit which improved material-financial position of EPS at the beginning of this year. During the winter 2013/2014 the series of positive business indicators from the entire 2013 continued, so that along with the sometimes higher, sometimes lower expenditures for the purchase of electricity outside EPS system, the winter will be remembered as the one in which EPS made profit in financial transactions instead of losing money.  According to the data from Department for Electricity Trading, it looked like this: from 1st December 2013 to 28th February 2014 only 236 million kWh were bought, although the plan was for EPS to buy 449 million kWh at the open market for the needs of winter consumption. The sale at the open market, outside the EPS system, was not planned. However, during this period PE EPS sold 384 million kWh at the external market. The bought and sold quantities do not show sale-purchase transactions towards Electric Power Industry of Montenegro based on the usage of HPP “Piva” in December last year.

When the quantities which were planned, but were not bought, are added to the quantities sold which were not planned, we get the sum of 597 million kWh, which is positive energetic effect in winter period. With those 597 million kWh the positive financial effect of some 6.4 million EUR was reached at the open market. In the Department for Electricity Trading, they explain that the trade was used for balancing and optimization of Electric Power Portfolio. i.e. for the minimization of the costs of supplying the final customers in the Republic of Serbia.

Gas saving, as well

In EPS Department for Electricity Trading, they also add that electricity trading during the last winter did not have negative effects on the stability of operation of electric power system of EPS.  On the contrary, the operation of production capacities  and the entire EP system was stable and secure. The total trade result was also affected by the fact that the sale to the final customers in Serbia during winter season was 817 million kWh lower than planned, due to warm weather and alleviated consumption. The positive effect of trading and electric power system management also includes the saving on fuel, gas for TPP-HP, which amounts to approximately two million EUR.

That is how, the total financial effect on the operation of EPS group based on electricity trading in winter 2013/2014 amounts to approximately 8.5 million EUR. From other point of view, not only from the financial point, it seems that it is equally important that by purchase and sale of electricity this winter, EPS made surplus although the electric power system did not get a single new significant production capacity, i.e. the power plant which would “compensate for” the constant shortage of electricity for winter consumption in Serbia. Also, the mines and power plants made it through this successful winter in terms of trading and electricity production, despite the fact that last year the number and the scope of regular annual facility overhauls were alleviated.

In the end, with the results reached in trading during last year, and especially during winter, it becomes obvious how much EPS, as public (state) enterprise, was inhibited at the free market of electricity where the profit is being made, and it is clear why it is important that “EPS Trading” is established in Slovenia, which is about to happen.

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