Electricians raise the specter of a “Lehman Brothers” energy
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What if the electricity and gas industry were on the eve of a crisis as serious as that of the bank Lehman Brothers, in September 2008, whose bankruptcy had led to a financial debacle unprecedented since the crisis of 1929? Companies and governments no longer hesitate to raise this specter in the face of players in the energy sector who are sometimes short of cash. More and more European countries must come to the aid of these companies shaken by a surge in prices further accentuated by the recent closure of the Nord Stream 1 gas pipeline, which supplies Russian gas to Northern Europe.
To buy electricity on the futures markets, and continue to supply their customers in the months to come, energy companies must go through clearing houses, such as Nasdaq Clearing AB in Stockholm, which guarantee the successful completion of operations in default of a seller unable to supply or a buyer unable to pay. However, the cost of this financial cover in the form of a cash advance (reimbursed on physical delivery of the current), which fluctuates from day to day depending on market prices, has become exorbitant.
“This is a serious concern for energy companies”said Kristian Ruby, Secretary General of Eurelectric, which brings together 3,500 European utility companies, in an interview with FinancialTimes. Centrica, the parent company of British Gas, is looking for billions of pounds to insure its future coverage, indicates the British daily. All major groups, such as the French EDF or the Finnish Fortum, are concerned. Even the strongest companies face “huge pressure” in terms of payment of financial guarantees, underlines RBC Capital Markets. Finland’s economy minister, Mika Lintilä, raised the specter of“a ‘Lehman Brothers’ moment in the energy industry” ; his Swedish finance colleague, Mikael Damberg, spoke on Sunday of “contagion effects on the rest of the financial market”.
Rescue policy
States play firefighters. The German group Uniper, 70% controlled by Fortum, has just asked Berlin “an extension of the credit facility”, an extension of 4 billion euros in addition to the 9 billion granted at the end of July by the public bank KfW. First importer of Russian gas across the Rhine and hit by the 80% drop in Gazprom’s exports to Germany, the State even had to enter its capital (30%). For his boss, Klaus-Dieter Maubach, he will have to continue his help. The company, which supplies hundreds of communities and energy suppliers, is “of capital importance for the economic development of the country”underlined the Social Democratic Chancellor, Olaf Scholz, to justify the intervention of the State.
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