Residential construction in the Urban Lakeside Aspern

Thüga closed the 2021 financial year with a good result. The approximately 100 municipal utilities and regional suppliers of the Thüga Group fully fulfilled their supply mandate and continued to drive forward the energy turnaround despite burdensome general conditions.

• Second Corona Pandemic Year Successfully Mastered
• Price turbulence on the energy market cushioned and security of supply ensured
• Investment result of Thüga Aktiengesellschaft exceeds plan at 321.8 million euros
• Thüga Group supports the German government's energy transition goals, but calls for better framework conditions for municipal players

In 2021, the approximately 100 partner companies of Germany's largest association of municipal and regional energy and water suppliers had to face the price turbulence on the energy market and the associated consequences in addition to the ongoing impairments caused by the Corona pandemic. "The municipal utilities and regional suppliers have also coped very well with this second pandemic year," says Michael Riechel, Chairman of the Board of Thüga Aktiengesellschaft. "As operators of critical infrastructure, they fully met their responsibilities. They presented themselves to the people as a reliable local supplier - also by taking on stranded customers of energy discounters in the replacement supply as a result of the price turbulence."

Rising energy consumption and extreme price increases
Energy consumption in Germany increased by 2.6 percent in 2021 compared to the previous year. Both the economic recovery in the second and third quarters and the cooler weather compared to the previous year had an increasing effect on consumption. The rapid recovery of the economy combined with insufficient energy supply caused extreme price increases in the second half of 2021 with unprecedented price volatility. As a result, some energy discounters in Germany were no longer able or willing to meet their obligations to their customers. The municipal utilities and regional energy suppliers of the Thüga Group included these customers in the replacement supply and in some cases had to procure additional energy on the wholesale markets at short notice.

Stable investment result
In the first pandemic year 2020, it was assumed in the planning that the partner companies would have to bear a burden on their results and therefore make lower distributions to Thüga Aktiengesellschaft in 2021. The main reasons for this were assumed to be declining sales and bad debt losses. However, the impact of Corona effects on the annual financial statements as at 31 December 2021 for Thüga Aktiengesellschaft and the Thüga Holding Group turned out to be lower than expected, also due to rapid and targeted countermeasures.

The investment result of Thüga Aktiengesellschaft - the most important performance indicator in the income statement - fell by €16.9 million in 2021 compared to the previous year, from €338.7 million to €321.8 million. The main reason for the slight decline is lower distributions and profit transfers from some affiliated companies. The shareholders of Thüga Holding will receive a dividend of 259.0 million euros (previous year: 262.0 million euros) from the net retained profits of 266.5 million euros for the 2021 financial year (previous year: 270.9 million euros).

As at 31 December 2021, the Thüga Holding Group had a total of 878 employees (previous year 852). The number increased compared to the previous year, mainly in the Trading segment. This is due to the transfer of the trading activities of eins energie in sachsen GmbH & Co. KG to Syneco Trading GmbH.

The financially effective investments in the 2021 business year were 43.6 million euros, slightly below the previous year's value (43.7 million euros). The focus of investment activity in the past year was in the network area as well as on various platform and innovation topics.

Coalition agreement: energy turnaround is a suburban turnaround
Thüga and its partner companies see their course confirmed by the coalition agreement: "The coalition agreement has climate protection as its guiding principle. We share this conviction and, together with around 100 regional energy and water suppliers, are ready to play an active role in shaping this change locally," says Michael Riechel.

Natural gas was stipulated in the coalition agreement as an indispensable component of the upcoming transformation process. Against the backdrop of the Ukraine war, however, it is essential to reduce gas and coal purchases from Russia in the short and medium term and to further diversify the sources of supply. Biogas has enormous potential for this, which has so far been neglected by politicians. In the medium term, more biogas plants should be built and existing plants expanded.

Furthermore, the coalition agreement names hydrogen as a key technology of the future. Thüga is equally convinced that hydrogen can make a rapid contribution to CO2 reduction across all sectors. A common regulatory framework for gas and hydrogen networks must be created in order to achieve the necessary planning and investment security here. The same applies to the electricity supply, which is to be based 80 percent on renewable energies by 2030. In addition to the expansion of renewable energies, attractive investment conditions for distribution grid operators must also contribute to the necessary expansion of the grid infrastructure.

"Municipal empowerment is important, i.e. the involvement and responsibility of the municipalities and their municipal utilities in the development and practical implementation of all necessary regulations and measures," emphasises Michael Riechel. "After all, they are the shapers of the energy transition on site, they know the local and regional conditions and the needs of the citizens.

Strong together
In order to drive forward the energy transition and make processes more efficient through digitalisation, the Thüga Group network continues to rely on cooperations and joint platforms. For example, numerous Thüga partner companies have contributed their expertise and know-how to the development of the Thüga Billing Platform (TAP). TAP is designed to handle billing processes in the commodity sector efficiently and automatically. The goal is better performance at reduced costs - and solutions that are adapted to the specific requirements of the Thüga Group. In 2022, the platform will be set up for the market roles of supplier, grid operator and metering point operator. The go-live is planned for the beginning of 2023. "We are bundling more than 15 million metering points from 38 companies with over 120 companies on one platform, which were previously billed in many different IT environments," says Dr Matthias Cord, Deputy CEO of Thüga. "A transformation project that is unique in its scope in Thüga's history and one of the largest solutions on the market."

The Thüga working group Hydrogen bundles and coordinates the hydrogen activities of the Thüga Group. Experts from various Thüga competence centres promote both knowledge management and the exchange between the partner companies. In addition, new knowledge is gained with the help of pilot projects and the political discourse is supported in a targeted manner. Among other things, the focus is on hydrogen in the heating market, decentralised generation and the blending of H2 into the existing gas grid. In order to test this, Thüga, together with Energie Südbayern GmbH, will conduct a pilot project in the Project H2 Direct convert a section of an existing natural gas distribution network to supply private households and a commercial customer with 100 per cent hydrogen for 18 months.

2021, the Thüga Holding Group completed the nachhaltigkeit@thuega project, published its first sustainability report and passed the topic down the line. The aim of this integrated sustainability management is to structure, further develop and make transparent all economic, ecological and social sustainability topics. "We want to continue to do business successfully in the future and address the relevant topics. As a municipal utility association, we have a special responsibility here. After all, as the Thüga Group we cover important basic needs of our customers - with electricity, gas, water, heat, data and some more. And anyone who provides such services of general interest has to think ahead," says Dr Christof Schulte, Member of the Board of Thüga Aktiengesellschaft. Based on the sustainability project, the Thüga Holding Group has undergone an ESG rating (Environmental, Social and Corporate Governance) for the first time. The assessment was carried out by the recognised rating agency ISS ESG and resulted in a grade C. "We are proud that we were able to achieve the so-called prime status with our first rating result - this is awarded to companies that demonstrate above-average sustainability performance in their industry," says Dr Christof Schulte.

Together for security of supply in the crisis
Nothing is currently occupying the energy sector as much as the Ukraine war. In the long term, accelerating the energy transition will be a key factor in reducing dependence on Russia. In order to secure the energy supply in the current critical situation and make it more resilient, Thüga is constantly advising and examining all possible options and necessary measures together with its partner companies and the energy industry associations. Thüga also supports its partner companies with up-to-date assessments of the legal situation and recommendations on crisis and incident management.

Detailed information on the 2021 financial year and current developments in the Thüga Group can be found in Thüga's Annual Report and Financial Report, which are available at www.thuega.de/downloads are available.

 

About Thüga:
Thüga Aktiengesellschaft (Thüga), based in Munich, is an investment and specialist consulting company with a municipal base. Founded in 1867, it is a minority shareholder in around 100 municipal energy and water companies across Germany. The respective majority shareholders are cities and municipalities. Together with its partners, Thüga forms the largest municipal association of local and regional energy and water supply companies in Germany - the Thüga Group.

The common goal is to shape the future of municipal energy and water supply. With its more than 200 employees, Thüga continues to develop and expand the Group, supports municipal companies with consulting and service companies and thus contributes to the competitiveness of its partners. They are responsible for active market cultivation with their local and regional brands: In total, the Thüga partners with their more than 21,000 employees supply over four million customers with electricity, two million customers with natural gas and one million customers with drinking water across Germany. In 2019, they generated sales of 24 billion euros.

Keywords:
Citizen Energy, DE-News, Renewable, Climate protection, Communities, Sustainable management, City