Energinet has published its annual accounts on Wednesday for a year that the state-owned company describes as "another wild year in the Danish energy sector". Revenue in 2023 ended at 11.1 billion. DKK, which is lower than the year before, when revenue was 12.33 billion. DKK. Energinet states this in a press release.
On the other hand, revenue is significantly higher than just a few years ago, e.g. 2020, when it was 5.7 billion. DKK.
The significant increase in just a few years reflects the fact that a huge boost has been put into restructuring the energy systems and connecting them more strongly with our neighbors. Among other things, in order to stay ahead of developments over the next four years, Energinet must invest around 42 billion. DKK in expanding and strengthening the electricity and gas transmission systems.
For example, in the first half of 2023, Energinet received approximately 70 percent more inquiries from developers who want to connect new projects than in the same period the year before. Solar parks in particular are responsible for the increase.
- Green transition is booming all over the world. It has a huge impact on the ambitious Danish expansion plans - and Energinet plays a central role in our success in fulfilling the great green society potential, says a statement in the annual report from Mogens Lykketoft, who is the chairman of the board of Energinet.
Profit transferred to equity
The year has also offered a profit of approximately 1.47 billion. DKK before tax compared to 440 million. DKK last year. On the bottom line, there is 1.14 billion. DKK, which is significantly higher than 2022, where the profit ended at 382 million. kr.
The profit before tax in 2023 was also significantly higher than expected, more precisely 400 million kr. higher. The reasons for the higher earnings are, among other things, increased sales of storage capacity in the subsidiary Gas Storage Denmark and fewer expenses than expected, primarily because Energinet's facilities in 2023 have unusually not been affected by accidents or damage, e.g. submarine cables damaged by ship anchors or the like.
Energinet will transfer the profit to its equity. Energinet has indicated that it currently has low equity compared to other European TSOs. This is because Energinet has historically been regulated according to a "rest in itself principle". The costs of operating the electricity and gas systems have been covered through consumers' tariffs, and if there was a profit one year, correspondingly less was charged in subsequent years.
The Danish Parliament has decided that parts of Energinet, like other parts of the energy industry, must be regulated according to revenue framework regulation. This gives Energinet a fixed revenue framework, which is set by the Danish Utilities Authority based on previous years' costs.
"Revenue framework regulation means that Energinet must assume significant risks to a greater extent that were previously taken collectively by energy consumers. Therefore, Energinet must be better financially cushioned to be able to handle large, unforeseen expenses, such as major breakdowns in the electricity or gas systems," reads the announcement from Energinet.
In 2024, Energinet expects an activity and investment level that is higher than in 2023. In 2024, total revenue is expected to be in the region of DKK 10,000 - 11,000 million, a profit before tax of DKK 1,200-1,300 million. DKK, as well as investment in fixed assets and work in progress for third party account in the range of DKK 9,000 – 11,000 million.
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