Results

Key financial information

In 2015, SE recorded earnings before interest, income tax, depreciation and amortization (EBITDA) of 869 million euro.

In 2015, SE recorded earnings before interest, income tax, depreciation and amortization (EBITDA) of 869 million euro.

The EBITDA result (+63% v.s. the previous year) was mainly affected by a change in the estimate of the provisions for nuclear decommissioning and storage costs, as well continuous efforts for cost optimization and efficiency, in both external costs concerning power plants and in staff functions as well as personnel costs.

Cash optimization and effective cash flow management continued to be the key initiatives supporting the profitability of the Company, with the net indebtedness increasing by 421 million euros despite of the 722 million euros of investments (including capitalized interest) realized during the year.

In view of the existing market conditions the Company recognized an impairment loss of 821 million euros, being the difference between the recoverable (the higher between sale/transfer value and net present value of expected cash flows) and carrying (book value) amount of its assets. Notwithstanding the aforementioned impairment loss the net income for 2015 amounted to 24 million euro.

The Company remains fully committed in sustaining its investment plan for the coming years 2016 – 2020, focusing on the timely completion of Units 3 and 4 of the Mochovce Nuclear Power Plant. The total investments realized during 2015 amounted to 722 million euros (including capitalized interest), with the vast majority concerning the 2 units currently under construction.

Moreover, the Company continues to examine potential opportunities by extending its presence in neighbouring markets as well as providing innovative services to final customers.

 

Separate Financial Statements Consolidated Financial Statements
Installed Capacity

The Company’s production base is balanced and consists of two nuclear, two thermal, thirty-one hydro and two photovoltaic power plants. The total installed capacity of own sources fell to 4 300.92 MW due to the decommissioning of two units of the Vojany power plant (220 MW). Hydro power plant Gabčíkovo (Gabčíkovo HPP, Malé Gabčíkovo HPP, Čuňovo HPP, Mošoň HPP) operated under the Slovenské elektrárne balance group until 9 March 2015, 23:59 hours.

Installed capacity overview (in MW)
Share of power plant types in installed capacity (%)
Nuclear power plants Thermal power plants Hydroelectric power plants Photovoltaic power plants

Electricity and Heat Production and Supply

In 2015 Slovenské elektrárne produced electricity in the volume of 19 707 GWh. With its own production sources the Company produced 19 259 GWh and with the hydropower plant Gabčíkovo, Čuňovo and Mošoň, operated on a contract basis to 9 March 2015, with a volume of 448 GWh, representing a year-on-year index of 0.895. In addition to electricity, the production sources provided ancillary services, thus contributing significantly to the stability of the Electricity Supply System of the Slovak Republic.

Emission-free sources contributed to electricity production with a 90% share, mainly thanks to the nuclear and hydro power plants. The Vojany power plant contributed with its cofiring of wood chips and production of green electricity in the amount of 35 GWh; the Nováky power plant in the volume of 4.5 GWh. Photovoltaic power plants in Vojany and Mochovce supplied together the standard 1.9 GWh.

Nuclear Power Plants

Nuclear power plants produced electricity safely and reliably. The production of 15 146 GWh was, when compared to the record year of 2013, lower by 3.6%. Nonetheless, the results achieved are still excellent, ranking the nuclear power plant units among the world leaders in terms of unit capability factor. However, compared with the previous year the level of ancillary services provided in the nuclear power sector has grown considerably. In 2015 the nuclear power plant units began, for the first time, to provide the negative part of secondary regulation to an external partner’s virtual unit. Moreover, in the period from June until December one unit was permanently under primary regulation. All in all the NPP Bohunice (EBO) produced 7 623 GWh and Mochovce (EMO) 7 523 GWh of electricity.

The best indicator of operational reliability is the power plant efficiency, the unit capability factor UCF of the nuclear units reaching 90.60% for EBO and 93.00% for EMO in 2015, and the unplanned capability loss factor UCLF15 for EBO amounting to 0.63% and for EMO 0.40%. By way of comparison with international standards, the best quartile for pressurised water reactor units within the global WANO scale is 90.71% for UCF and 0.89% for UCLF (for the period 2011 – 2013).

Hydro Power Plants

The entire period of winter and the beginning of spring were marked by the average production at the power plants along the river Váh’s cascade. Winter produced below-average snow supplies that melted on an ongoing basis, meaning no impact production increases. Spring rainfall, which persisted up until mid-June, brought an improvement and provided stable inflows. A hot and dry summer and autumn, virtually without any rainfall, again changed everything. Production was declining from month to month and, in the traditionally driest month of September, the river Váh produced only 60 GWh. The total production for 2015 finally reached 1 680 GWh, the third lowest over the past decade.

The Danube’s hydrological situation was very favourable at the start of the year. High flow rates persisted from January, with a peak performance of EGA at 600 MW. The Gabčíkovo hydro power plant ceased to be operated by Slovenské elektrárne on 9 March 2015. By that time the power plant produced 443 GWh, representing 37 GWh above the plan.

The use of pumped storage power plants rose against the previous year. Besides producing peak electricity and providing ancillary services, these power plants play an irreplaceable role in solving outages at other sources in Slovenské elektrárne’s portfolio. Their production totalled 302 GWh, with a 408 GWh pumping consumption.

Thermal Power Plants

The Nováky power plant (ENO) has come through a challenging year, marked by the modernisation of units 1 and 2. Both units were shut down for more than half a year, whilst during the concurrent shutdown from June to September, production was provided from ENO units 3 and 4, which are nearing their end of service life. The general economic interest for electricity production from Slovak coal was fulfilled to 100.02%. Overall, together with the co-firing of biomass at ENO A, they produced 1660 GWh. As at 31.12 the operation of units 3 and 4 was ended, after 40 years of service.

The Vojany power plant (EVO) is operated on a commercial basis. Despite the continued fall in electricity prices, the production plan was fulfilled, thanks to optimal deployment and a suitably chosen sales strategy. The Company used short-term increases in electricity prices and demand for ancillary services during the hot summer, so that eventually the production plan was exceeded by 65 GWh. Total production amounted to 470 GWh. The production base was also narrowed at Vojany. On 13.3.2015 the Company management decided to terminate the operation of EVO units 1 and 2.

Gross electricity production (in GWh)

Heat Production

Heat production is based mainly on the cogeneration of heat and electricity. In 2015 SE produced 838 GWh of heat for heating plant purposes. Of this heat, 480 GWh was produced at the EBO site, and 270 GWh at ENO, with other sites producing 88 GWh.

Electricity Pricing

The price of electricity as a commodity is determined by the market without any form of regulation. The electricity price for end consumers consists of several components. Transmission and distribution related fees, as well as system fees are regulated, and are set by a decision of the Regulatory Office for Network Industries (RONI). In 2015 the electricity price for households and small businesses was regulated, by setting the maximum price, but tracking the trend in market prices.

Besides the price for the commodity itself, the end price also includes system fees, the main part of which is for supporting the use of renewable energy sources, the production of electricity from domestic brown coal, the procurement of ancillary services and the operation of the electricity spot market organiser (OKTE). Transmission and distribution fees are used to cover costs incurred by the transmission system and distribution system operators. The electricity price also includes the fee for the levy to the National Nuclear Fund, the amount of which is set by the respective SR Government Regulation. In addition to these fees, end customers (other than households) are also charged excise duty. All customers are also subject to value added tax (VAT), pursuant to applicable laws. In 2015, the total end price for electricity for households fell against the previous year by almost 8%, while the price for industrial customers fell by approximately 2%. This fall in the end price for electricity was due mainly to the fall in the wholesale price, by approximately 3 €/MWh.

The regulated components of the end price also fell, though negligibly, on average by 0.2 €/MWh.

Composition of the average end price for electricity for households with consumption of 2.5 – 5 MWh (eur/MWh, excl. taxes)
Composition of the average end price for electricity for industry with consumption 70 – 150 GWh/year (eur/MWh, excl. taxes)

Slovenské elektrárne in the Current Market Environment

The installed capacity of wind power plants grew in Germany again this year, reaching a capacity of 43.8 GW and representing an increase of more than 8 GW. On 21 December 2015 the capacity of wind power plants reached its record high of 35.6 GW. There was a slight slowdown of solar sources, about 1.5 GW, reaching a total capacity of 39.7 GW. Roughly 56 TWh came from the electricity production from biomass in 2015, meaning nearly a 25% increase against 2014. All in all the renewables in 2015 produced almost 190 TWh of electricity. When compared with 2014, this represents a 20% increase and 35% coverage of net electricity supplies. Despite the low fuel prices the production of electricity from natural gas and coal reported in Germany a further decrease against the previous year.

The downward trend in electricity prices continued also in 2015 when the Slovak wholesale price fell by 7% on a year-on-year basis. The plunge in fuel prices, persistent low prices of emission permits, stagnation in electricity demand and growing production from renewable sources pushed electricity prices to their new low. The Slovak electricity market recorded the lowest prices of the last decade, when in August the electricity price fell to 31.3 €/MWh.

Wholesale electricity price in Slovakia (€/MWh)

Note: PXE - Prague Energy Exchange

Despite the adverse conditions SE sustained its dominant position in the Slovak and regional market. The strategic position of Slovakia is one of the important factors for electricity trade and transmission to Hungary and the Balkans, a region with higher price levels. Since Romania’s connection to the market coupling, the importance of the local market, and of SE, in the region has grown further.

The Company is aware of its position as the leading trader in the domestic electricity market, and for this reason it is trying to increase Slovak market liquidity and transparency through trading platforms. Thus, the Slovak market should reflect real market conditions and become even more attractive for all its market players.

Electricity Trading

Slovenské elektrárne sells its production via transactions concluded under market conditions, generally using brokerage platforms, the Prague Energy Exchange (PXE), considered in the region to be the most transparent and appropriate method of electricity trading. This strategy has long been received positively by the Company’s trading partners.

SE sells the majority of its production on a forward basis three years in advance of electricity supply, according to its marketing strategy. This strategy represents an efficient way of hedging prices and the planned production volumes.

Residual electricity not sold on an annual basis is traded on a short-term basis on the Slovak spot market and in the surrounding markets on a bilateral basis, using mainly brokerage platforms. This volume represents approximately 7% of the total annual production and is necessary to maintain the balance position of SE, while respecting the unforeseeability of water sources in the Company’s production portfolio. Export or import on a daily basis is inevitable when considering the size and liquidity of the Slovak energy market

Heat Trading

Slovenské elektrárne produced 838 GWh and sold 658 GWh of heat in 2015, achieving revenues of 19.7 million euro. Heat production is mainly based on co-generation of electricity and heat and distributed via the central heat supply systems of Bohunice nuclear power plant (EBO) and Nováky thermal power plant (ENO).

Share of plants in Slovenské elektrárne’s heat sales (GWh)
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