RWE Hrvatska

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RWE Hrvatska
Factbook Croatia February, 2015
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RWE is performing business activities across the
whole of Europe
RWE Hrvatska within RWE East
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RWE East is performing business activities in six
countries (2013 figures)
RWE Hrvatska within RWE East
2014
-
Except Croatia
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RWE Hrvatska Newly established management
holding within RWE East since January 2013
RWE Hrvatska
RWE Subsidiaries in Croatia
TE Plomin d.o.o. (since 1996)
ZOV d.o.o. (since 2000)
RWE Energija d.o.o. (since 2013)
RWE Plin d.o.o. (since 2014)
Electricity production
Waste water treatment
Electricity supply
Gas supply
First move of European Utility into Croatian
electricity and gas supply market
First joint venture company for electricity
generation in Croatia
Biggest waste water treatment plant in West
Balkan Region
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The emerging market Croatia in terms of
Croatian Energy Market
demographics
economics
GDP volume 42.866 bn (2014) GDP growth
rate -0.8 (2014) GDP per capita 10,221
(2014) Inflation rate CPI -0.2
(2014) Unemployment rate 19,9 (2014) Average
ex.rates US/HRK 5.75 (2014) /HRK
7.63 (2014)
Area 56,594 km² Population 4.25 m
(2014) Population growth rate -0,45
(2014) Average age 42.2 (2013)

• Zagreb

energy demand
installed capacity and net electricity demand
N.Gas Consumption 2,809.5 bcm (2013) Gross
Electricity Cons. 17.3 TWh (2013) Peak
Electricity Demand 2,813 MW (2013) Minimum
load 1,105 MW(2013) Net Electricity Demand
14.6 TWh (2013) Domestic power production 12.8
TWh (2013) Installed Capacity 4.386 GW (2013)
Oil7
Others 4
N.Gas26
Coal 7
Household 42
Nuclear 8
Services34
Hydro51
Industrial 21
Total installed capacity4.386 GW
Net Electricity Demand 14.6 TWh
Source Croatian Bureau of Statistics, HOPS, HERA
Raiffeisen Research
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TE Plomin d.o.o. - Thermal power plant in Plomin
RWE subsidiaries in Croatia

• TE Plomin d.o.o. is a joint venture of HEP d.d.
  and RWE.
• It is the first joint venture company in the
  industry of electricity generation in Croatia.

• Contract
• Financing, construction and operation of PP
  Plomin 2 (hard coal, 210 MWnet)
• Longterm PPA with Croatian Utility HEP
• Contract duration
• Exit after RWEs full repayment in April 2015
• Project structure
• JV 50 RWE Power AG, 50 HEP d.d.
• Financial Frame of Investment
• Volume app. 300 Mio. EUR
• Year of commissionig
• 2000

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Key data - Power plant TE Plomin d.o.o.
RWE subsidiaries in Croatia
TE Plomin 2 is owned by TE Plomin d.o.o.
Production and maintenance are carried out by HEP
Generation d.o.o.
Category Unit Rated operation
Furnace thermal capacity MW 568
Imported coal use t/h 79,2
Capacity MW 210
Energy conversion efficiency gt37
Annual production average (10 years) 2009 2010 2011 GWh GWh GWh GWh 1316 1242.7 1511 1545
Quantity of steam kg/s 186,1
Live steam pressure / live steam temperature bar / C 148 / 535
Hot reheat pressure / hot reheat temperature bar / C 47 / 535
Condenser pressure mbar 46
Feed water inlet temperatur C 24,9
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ZOV d.o.o. - Waste water treatment plant in Zagreb
RWE subsidiaries in Croatia

• The Zagrebacke otpadne vode d.o.o. (ZOV) was
  founded in 1998 and charged to plan, finance and
  erect the WWTP Zagreb as well as the related
  infrastructure.

Zagreb

• Contract
• Financing, planning, erection, operation and
  maintenance of WWTP Zagreb (for 1,2 mill.
  Inhabitant Equivalent, IE)
• Contract duration
• 28 years, until December 15th, 2028
• Project structure
• ZOV d.o.o. (Project company) 48,5 RWE
• SRV d.o.o. (Construction company) 50 RWE
• ZOV uip d.o.o. (Operating company) 33 RWE
• Financial Frame of Investment
• Volume (incl. funding costs) 350 Mio. EUR
  (thereof 20 equity capital, 80 by KfW,
  Frankfurt and EBRD, London)
• Construction time
• 5 years (July 2002 August 2007)

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Key data - Waste water treatment plant ZOV d.o.o.
RWE subsidiaries in Croatia
sludge-treatment

• Capacity1,2 mill. IE
• Sewage flow330 Tm³/d,max. 20 Tm³/h
• Pollutant loadca. 90,000 kg BOD5/d
• Sludge productionca. 150 t/d
• Utilisation of sewage gasCHPs with 2,4 MWel
  currently ca. 85 Bedarfsdeckung
• Employees
• More than 70

biologicalpurification
mechanicalpurification
The biggest waste water treatment plant in West
Balkan Region
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RWE Energija d.o.o. Electricity Supply Business
RWE Energija d.o.o., a 100 affiliate of RWE
Hrvatska d.o.o. was acquired in June 2013 (former
Energija 2 Sustavi d.o.o.) to act as a 1st mover
in the liberalising Croatian energy market in the
context of EU accession in July 2013.

• Business activities
• Procurement and sales of electricity to final
  customers in Croatia
• Foundation of business
• Start-up in August 2011
• Electricity Supply License year end 2011
• Energy supplies
• Sales to public institutions and commercial
  customers since 2012
• Sales to private households since June 2013
• Market share target
• at least 10 in 2018

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Key data - RWE Energija d.o.o.
RWE subsidiaries in Croatia
RWE Energija is a 100 subsidiary of RWE Hrvatska
d.o.o.
Category 2014 figures year end
Energy supply to customers 582.5 GWh
Net turnover /revenues 237.5 Mill. HRK / 7.63 Mill.
Contracts household customers app. 95.000
Contracts small business customers app. 2.750
Market share all customers 5,4
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Market
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ELECTRICITY MARKET
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Croatian Electricity Market Model
IMPORT/ EXPORT
Trader 1
Trader n1
Generator 1
Generator n2
Supplier 1
Supplier n2
Electricity market eligible clients

• State ownership among power producers and
  downstream segment reaches above 80-90, while in
  trading is less than 10

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Croatian Electricity Transmission System
Source HOPS
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Croatia Annual power demand and system peak load
Source HOPS
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Development of electricity prices in Croatia(for
household customers)
Development of average household1) electricity
prices 2005 100
167
134
125
110
98
101

• Annual consumption of 3,500 kWh/2,500 kWh lt
  Consumption lt 5,000 kWh (new price calculation
  methodology from 2007 onwards
• Source Eurostat, February 2015.

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Development of electricity prices in Croatia(for
industrial customers)
Development of average industrial1) electricity
prices 2005 100

• Annual consumption of 2,000 MWh/500 MWh lt
  Consumption lt 2,000 MWh (new price calculation
  methodology from 2007 onwards)
• Source Eurostat, February 2015.

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GAS MARKET
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Croatia exhibits a typical EU-gas market
structure but with a still regulated retail
market

• Two regulatory authorities for the gas market
• Croatian Energy Regulatory Agency (HERA) and the
  Croatian Energy Market Operator (HROTE).
• These regulate specific areas of the gas sector
  such as organization and functioning of the gas
  market, tariff systems, allocation, and use of
  cross-border transfer capacities.
• Current EU law already enacted
• The Act on the Regulation of Energy Activities
  and the Gas and Power Acts was fully implemented
  in March 2013.
• This ensures legal unbundling, customer
  protection and TPA to certain infrastructure.
• Croatia does not impose any special rules on
  cross-border gas trade - all deals are conducted
  bilaterally, although export restrictions and
  rules requiring reporting to institutions may
  apply under special conditions.

Market activities
Regulated activities
INA Ina-Industrija Nafte d.d. CEE Central
and Eastern Europe PSP Podzemno Skladiste
Plina d.o.o.
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More than half of Croatias demand is covered by
indigenous production
Production 13,120
Import 12,202

• Strong indigenous production
• Croatia currently meets around 65 of its gas
  requirements through domestic production operated
  by INA
• Recently issued concession will hold production
  stable or even increase production
• Imports from adjacent markets no long term
  contract
• Former Russian imports are replaced by imports
  from Hungary, Austria and Italy
• Gas demand expected to increase
• New power generation capacity is expected to
  increase gas demand however it remains unclear
  if all of the new plants will be built

Transport System 25,881
Storage 548
DSO 10,906
Industry 14,975
Industry 4,494
House-holds 6,157
Losses 258
Source HERA, annual report (2013)
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The Croatian gas market player structure has
undergone a substantial transformation since 2008

• Transformation to an unbundled structure
• To comply with EU regulations Croatia gradually
  transformed its integrated gas market structure
  to the current unbundled form
• Domestic production
• INA is Croatias major upstream oil and gas
  producer
• Transmission
• Since 2007 Plinacro d.o.o. is responsible for
  allocation and reservation of transmission
  network capacity - 100 state-owned company
• Storage
• Since 2009 PSP - 100 owned by Plinacro is
  operating the 0.55 bcm Okoli site.
• Distribution
• Currently 36 active distribution system
  operators, mostly owned by local municipalities
• Those with less than 100,000 customers are not
  unbundled
• Midstream
• Since 2008 more and more companies emerged on the
  midstream stage of the market, with currently 20
  active companies

Delivery and sales of the natural gas from own
production
Production marketing
Natural gas storage
Natural gas transmission
Gas distribution and regulated gas supply
INA d.d.
HEP d.d.
PSP d.o.o
Plinarco d.o.o
36 DSOs
Gas midstream and non-regulated supply
20 Companies
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Development of gas prices in Croatia (for
household customers)
Development of average household1) gas prices
(including gas tax) 2005 100
82
2)

• Annual consumption of 83.7 GJ/20 GJ lt
  Consumption lt 200 GJ (new price calculation
  methodology from 2007 onwards2) First half of
  2014
• Source Eurostat, February 2015.

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Development of gas prices in Croatia(for
industrial customers)
Development of average industrial1) gas prices
(including gas tax) 2005 100
2)

• Annual consumption of 41,860 GJ, load factor 200
  days, 1,600 h/10,000 GJ lt Consumption lt 100,000
  GJ (new price calculation methodology from 2007
  onwards)2) First half of 2014
• Source Eurostat, February 2015.