May 22nd, 2024 | 07:30 CEST
Siemens Energy, Kraken Energy, RWE - Power supply in the age of electrification
In today's world, reducing emissions in energy production is a top priority to combat climate change and ensure a sustainable future. Nuclear power plants are capable of producing large amounts of energy with virtually zero emissions. Existing capacities need to be expanded, especially given the growing demand for energy due to electromobility, cryptocurrencies and artificial intelligence. Renewable energies such as solar and wind power can play a part in this, but there are still challenges, such as increasing efficiency and developing infrastructure. We take a look at three companies that are committed to the future of energy production.
time to read: 4 minutes
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Author:
Armin Schulz
ISIN:
SIEMENS ENERGY AG NA O.N. | DE000ENER6Y0 , KRAKEN ENERGY CORP | CA50075X1024 , RWE AG INH O.N. | DE0007037129
Table of contents:
"[...] Recovery rates of more than 90% rare earths are another piece of the puzzle on the way to the economic viability of our project. [...]" Craig Taylor, CEO, Defense Metals
Author
Armin Schulz
Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.
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Siemens Energy - Rumor about sale of Gamesa subsidiary
Siemens Energy, as a leading global energy technology company, has 5 main business areas: Conventional Power Generation, Renewables, Power Transmission and Distribution, Industrial Energy Solutions, and Automation and Drive Technology. In Renewable Energies, the Siemens Gamesa wind power division is primarily responsible for the Group's poor figures. Yet the general conditions are good. The traffic light coalition has agreed on faster approval procedures for wind turbines and industrial plants. In order to reduce bureaucracy, they want to focus more on digitalization.
Rumors recently surfaced that the Company is considering selling the Indian wind turbine division of its subsidiary Siemens Gamesa Renewable Energy. According to a report in the Indian business newspaper "Mint", the business is valued at USD 1 billion. Several potential buyers, including Adani Renewable Energy, Masdar from Abu Dhabi and investors such as TPG Rise, Brookfield Energy Transition Funds and Macquarie, are said to have expressed their interest. A Siemens spokesperson has not yet commented on the matter, nor have the investors or the British bank Barclays, which has been commissioned with the sale.
The rumors come as a surprise, as a comprehensive restructuring plan for the loss-making wind power division Siemens Gamesa was presented around the figures for the second quarter, which turned out better than expected, and is intended to make the subsidiary profitable again. Otherwise, the operating business is going so well that the Company has raised its annual forecast. Goldman Sachs, Deutsche Bank and Berenberg have recently issued "Buy" recommendations with price targets of between EUR 26.00 and EUR 33.00. Bernstein Research and JP Morgan view the share as a "Sell". The share is currently trading at EUR 23.99.
Kraken Energy - An up-and-coming uranium producer in the USA
Kraken Energy is an emerging exploration company focused on developing uranium projects in the US to meet the growing demand for uranium both domestically and internationally. Led by CEO Matthew Schwab, Kraken Energy's strategy is to establish a hub-and-spoke model in the US mining sector. With 4 high-grade projects, 3 in Nevada and 1 in Utah, the Company is positioning itself to capitalize on the significant supply gap in the US. This strategic vision aims to establish Kraken Energy as a leading domestic uranium producer.
One of Kraken Energy's main projects in Nevada is called the Apex Uranium Mine, which is a historic mine field with extensive uranium mineralization. The mine, which started as a silver mine in the 1930s and switched to uranium in the 1950s, was shut down due to a lack of government incentives. On May 14, the Company announced promising radon results at this property near the historic Lowboy Mine. New strong radon anomalies indicate potential uranium mineralization at depth. Drilling permits are awaited, and drilling is expected to begin in August. The US Forest Service is currently reviewing changes to the plan of operations. Kraken is using historical data to guide future exploration work in the Apex area.
Another promising project is Harts Point in Utah, where radioactive anomalies have been discovered in the Shin-Ley formation. This formation has produced significant uranium deposits in neighboring areas. Kraken Energy's recent drilling has yielded promising results, and the Company plans to conduct further exploration based on these results. With permitting now in sight, Kraken Energy remains optimistic about making substantial progress through planned drilling programs and strategic exploration in 2024. The share is currently forming a bottom around CAD 0.105 and currently stands at CAD 0.11.
RWE - Strong start to the 2024 financial year
The Essen-based energy group RWE has made a successful start to the 2024 financial year. The adjusted EBITDA reached EUR 1.7 billion, while the adjusted net result amounted to EUR 800 million. These results exceeded analysts' expectations. The positive development is due, in particular, to better wind conditions in the Offshore Wind segment and capacity increases in onshore wind and solar power plants. Despite a planned decline in the Flexible Generation segment, RWE maintained its forecast for the full year and announced a dividend of EUR 1.10 per share.
RWE continued to invest heavily in the expansion of renewable energies in the first quarter. With net investments of EUR 2.3 billion, including EUR 1 billion for the acquisition of offshore wind projects from Vattenfall, the Company is continuing on its growth path. A total of 42% of electricity generation in the first quarter came from renewable sources. Projects under construction include the Sofia offshore wind project off the British coast with a capacity of 1.4 gigawatts and the Danish Thor project with 1.1 gigawatts. RWE is also investing in over 100 projects in Europe and the US, including onshore wind, solar energy and battery storage plants.
In the Offshore Wind segment, RWE achieved an adjusted EBITDA of EUR 548 million due to improved wind conditions. The Onshore Wind/Solar segment also recorded growth. It achieved an adjusted EBITDA of EUR 341 million, boosted by the commissioning of new plants and the integration of Con Edison Clean Energy Businesses. The Company recently commissioned a 12 MW photovoltaic plant in the Hambach opencast mine, which is combined with a battery storage system. The share has been consolidating since the quarterly figures. One share currently costs EUR 34.53.
Nuclear power plants are being planned and built around the world. The demand for uranium will continue to rise, and the current production capacities will lead to a deficit. There is more uranium, but prices must increase to make mining more attractive. There are good prospects for Kraken Energy, which has four projects with partly historic uranium mines. There will be more news with the new drilling program. Siemens Energy is suffering from the weak results of its subsidiary Siemens Gamesa. A sale may be in the offing here. RWE is expanding its renewable energy portfolio and was nevertheless able to present very ordinary quarterly figures. Ultimately, it will come down to a mix of nuclear power and renewable energies if emissions are to be avoided.
Conflict of interest
Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.
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