The energy supplier Mainova is increasing its coal reserves at the West power plant in Frankfurt in order to be protected from supply bottlenecks and price increases in the near future.

Basically, however, the company, which presented its annual report for 2021 on Friday, is sticking to the course it decided long before the start of the war in Ukraine: in 2026, coal-fired power generation in Frankfurt is to end and instead a new gas-fired power plant will be connected to the grid next to the existing one walk.

The call for tenders is currently underway to determine a general contractor for the project, which will cost more than 300 million euros.

Inga Janovic

Editor in the regional section of the Frankfurter Allgemeine Zeitung and responsible editor of the business magazine Metropol.

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Mainova CEO Constantin Alsheimer is currently unable to predict what will ultimately be burned in the new plant, whether natural gas from Russia or Qatar or soon hydrogen.

It is also unclear what will happen to the old thermal power station and whether it can be shut down.

The Mainova has planned this, but the Federal Network Agency could demand that these old turbines continue to run if necessary.

The new power plant will be built in such a way that it will also be able to burn gas mixtures containing hydrogen right from the start.

In the more distant future, it will then be completely converted to this renewable raw material.

Even if the framework conditions are now different, nothing has changed in the function of gases for the energy transition, says Alsheimer.

"Especially in Germany we need them as large-volume energy storage systems."

"We must remain open to technology"

He reminds us that, especially in winter, the yields from wind and solar power plants drop sharply, at least for this the energy generated would have to be converted into storable gases.

The fact that the federal government wants to accelerate the switch to hydrogen is in Alsheimer's interest.

However, he warns against blocking the way to obtain it.

"We have to stay open to technology here too."

Mainova is also currently dealing with the price jumps on the raw materials and energy markets, from which it also benefited in 2021.

The adjusted annual result totaled 166 million euros, which is almost six million euros more than in 2020 and an increase of more than 30 million euros compared to the pre-corona year 2019. The power supply business area has grown particularly significantly: profits have increased almost 22 million euros to now 28 million euros.

By selling electricity to its customers, Mainova generates more than a billion euros a year and thus a third of its total turnover.

The high profit can be explained, among other things, by the so-called spot market, i.e. the short-term wholesale electricity trade.

While the Frankfurters had to sell excess electricity there at low prices the year before, which customers had not bought from them because of the Corona crisis, they were now able to take advantage of the rising prices.

High world market prices will only reach customers with a delay

The gas business also did better in 2021 than in 2020, the winter was significantly colder, so sales volumes were higher.

However, this plus was partially canceled out by the price increase for natural gas, which is why profits in this segment rose only moderately to 45 million euros, explains Alsheimer.

In total, the company generated 463 million euros from gas sales.

The currently high world market prices will only reach customers with a delay in the next year or two, because Mainova has bought its energy quantities in advance at fixed prices.

It still pays cheaper tariffs than are currently being called on the markets.

But if prices remain high, the utility will charge more.

Since taxes and duties are 40 percent on the electricity price and 25 percent on the gas price, the Mainova board sees the state as having an obligation to cushion these price increases.

The cold winter was able to support the result in energy production, which is shown in the Mainova balance sheet together with the district heating business.

The company made a profit of 22 million euros with its power plants, but compared to the previous year it fell by 44 million euros.

Alsheimer explains this decline with the re-evaluation of the less successful gas-fired power plants in Bremen and Irsching.

The drop in profit was to be expected, the good district heating business cushioned it.

According to the annual balance sheet, heat sales increased by ten percent in 2021.

And it should continue to do so, the expansion of the Frankfurt district heating network is part of the 1.8 billion euro investment program that Mainova has launched for the next few years.

In addition to the plans for the so-called heat transition, this also includes the expansion of the electricity network in the growing city of Frankfurt, entry into the data center market and planned investments in green electricity plants.

Mainova's existing investments, above all in the Munich energy group Thüga, account for almost half of the annual profit at 76.8 million euros.

The business field of renewable energies and energy services is significantly smaller at the Frankfurt-based company compared to the classic business.

But that could change soon, Mainova has recently become a shareholder in Solarenergie Boitzenburger Land GmbH, which intends to build Germany's largest solar park in Brandenburg with a peak output of 175 megawatts.

Mainova wants to market the electricity directly.

Mathematically, it then generates renewable electricity with its own systems to supply 227,000 people.