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Seepex Annual Report 2019 SRP PDF
Seepex Annual Report 2019 SRP PDF
Report
2019
Foreword
The Energy Law has defined the organized energy activity of wholesale of electricity in the
electricity market as an institutionally Republic of Serbia.
regulated relationship between the supply and
the demand of participants on the electricity Since the function of clearing and the so-called
market, with predetermined standardized “central contracting party” is practically
products and physical delivery, within the time nonexistent in Serbia at a satisfactory level, the
frame “day ahead” and “intraday”, recognizing Energy Law defines the possibility of clearing
the management of the organized electricity and financial settlement in an organized
market as one of its energy related activities. market being performed abroad, i.e. in a
European country. As an important segment of
Also, Article 179 of the Law prescribes the the entire concept, the Energy Law (Article 181,
obligation of J.S.C. Elektromreža Srbije, as the Par. 3), defines that in such a case ’all payments,
operator of the transmission system, to collections and transfers on the basis of
establish an operator of the organized financial settlement between organized power
electricity market. The Government of the market participants will be carried out in EUR.
Republic of Serbia, at a session held on This enabled the implementation of the
February 28, 2014, has adopted the Decision no. defined market model and participation of
3121864/2014, which officially accepts the foreign companies on the power market in the
Report on measures introduced in order to Republic of Serbia, which was one of the
establish an organized electricity market in the preconditions for SEEPEX to start operating, i.e.
Republic of Serbia, and recommends J.S.C. EMS for the start of functioning of the dayahead
to start the activities towards the market. Pursuant to the above, after months of
establishment of the organized electricity preparatory activities and obtaining the
market and the Market operator, with a 25% required approval of all relevant state
stake in the share capital of the newly authorities, SEEPEX was finally registered on
established company owned by EPEX SPOT. July 14, 2015 as a joint stock company where
J.S.C. EMS owns 75% of shares, while EPEX SPOT
The implementation of this business model in
owns 25%. After the completed membership
Serbia required, among other things,
process for the members’ participation on
harmonization of other primary and secondary
SEEPEX, the first transactions on SEEPEX
legislation in the field of energy and financial
started on February 17, 2016.
legislation. In that context, the Serbian
Government has adopted amendments and
supplements to the Law on VAT (’Official 25%
Gazette of RS’, no. 83/2015), which has brought
substantial innovations regarding VAT related
obligations in Serbia that directly affect the
determination of tax debtor, registering a
foreign entity for VAT, VAT exemption for import,
etc. Also, the Ministry of Mining and Energy
adopted a Regulation on the license for
performing energy activities and certification
(’Official Gazette of RS’, no. 87/2015), which
regulates the conditions of issuing and revoking
licenses, enabling foreign entities to be
75%
registered and to obtain a license for conducting
The company is registered in the Register of Companies at the Business Registers Agency of the
Republic of Serbia as SEEPEX Akcionarsko društvo Beograd. Its registration number in the single
taxpayers register is BD 61538/2015 of July 14, 2015 and BD 72365/2016 of September 12 (The second
portion of payment).
The company performs the activity of Organized market operation, which is an institutionally
regulated relationship between the supply and demand of the participants on the organized
electricity market, with predetermined standardized products of electricity and delivery within the
time frame “day ahead” and “intraday” (“Market”). The company can perform all business activities
for which the conditions laid down by the Law and other regulations were met, pursuant to the
Decision of the Government of Serbia 05 no. 023 6656/20151 of June 18, 2015.
The Organized Market Committee and the The Market Surveillance Office monitors, as an
market Surveillance Office are two independent body, the SEEPEX market and its
independent bodies that have been put in place Exchange Members on a daily basis. It
in order to ensure the best governance rules. continuously monitors the SEEPEX markets and
checks that members comply with SEEPEX
The Organized Market Committee is a body Market Rules. Market Surveillance acts as a
elected from the Exchange Members which central point of contact that cooperates with
decides on the Rules and on general decisions the national regulatory authority.
SEEPEX
ORGANIZATIONAL STRUCTURE
3
MEMBERS
Regulatory
Body
3
MEMBERS
Implementation
of accounting and risk
management policies
3
MEMBERS
The strategic
orientation of the
company
PRODUCTION INSTALED
5000
4429 TYPE CAPACITIES (MW)
4000 HPP 2941
3000
2941 TPP (Coal) 4429
Combined 330
2000
Wind 373
Other (small 201
power plants)
330 373
1000
201 TOTAL 8274
0
HPP TPP (Coal) Combined Wind Other
(small power plants)
In 2019, 34.832 TWh was produced, which is 0.3% less compared to 2018. Coal plants produced 0.9%
more, while production in HPPs was 11.6% lower. The share of coal power plants production was
66.5%, hydro power plants 28.4%, combined 0.9%, wind 2.3% and small power plants 1.7%.
SEEPEX started its dayahead market companies to access SEEPEX. The following
operation with 6 members on February 17 figures show the trend of increasing the
2016. A well-chosen and implemented number of participants.
business model and membership strategy
have enabled SEEPEX to achieve continuous At the end of 2019, 19 exchange members from
growth of new members. Increasing the 11 countries were active on SEEPEX. The
number of members leads to higher liquidity, composition of the members on the exchange
which again gives a good signal to new is given in the following table and graph.
2019
19 Participants
NUMBER OF EXCHANGE PARTICIPANTS AT THE END OF 2019
GERMANY
Alpiq Energy SE
6%
CZECH
MVM Partner Energy Trading Ltd. REPUBLIC
5%
Energy Financing Team AG
HUNGARY
AXPO Solutions AG SWITZERLAND
11%
SLOVENIA
CROATIA
GEN-I BOSNIA
AND SERBIA
Interenergo d.o.o. HERZEGOVINA
HEP d.d. 5%
3000 60
55.78 56.79
50.15 50.58
2500 50
2000 40
9%
€/MWh
GWh
1500 30
2 318.3 2 528.2
1000 20
500 10
0 0
2018 2019
Volume Base Price Peak Price
The largest monthly trade volume of 260 895.1 which is 1.76 times more than in the previous
MWh was registered in November 2019, while year. The biggest hourly price was reached on
the daily maximum was reached on March 11, August 29 at 9 pm and amounted to 153.5
2019 with 13 483 MWh. The smallest volume of €/MWh. In 2019, the average SEEPEX base
monthly trade, as the year before, was in price was 50.58 €/MWh, while the average
February and amounted to 168 968 MWh, SEEPEX peak price reached 56.79 €/MWh.
MWh
80 8000
60 6000
40 4000
20 2000
0 0
2019-01-01 2019-01-31 2019-03-02 2019-04-01 2019-05-01 2019-05-31 2019-06-30 2019-07-30 2019-08-29 2019-09-28 2019-10-28 2019-11-27 2019-12-27
160
140
120
100
80
60
40
20
0
Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19
-20
-40
-60
SEEPEX HUPX OPCOM IBEX Cropex German DE
The monthly volumes recorded in 2018 and 2019 are shown in the table. A significant increase in trade
can be noted in the first quarter of 2019 compared to 2018.
4%
5%
2%
3% 6%
10%
3%
23% 4%
12%
9% 9%
6% 6%
SALE 5% 5% PURCHASE
PERCENTAGE OF TRADE BY PARTICIPANT
The total amount of electricity that was relation to the energy delivered to end
traded on SEEPEX in 2019 was 2 528.2 GWh. customers that are supplied on the free
The share of electricity traded on the market (retail market). The share of the power
organized market in relation to gross exchange on the entire wholesale market,
consumption in Serbia (33 807 GWh) was 8.7%, which includes bilateral and organized
while 18.7% is the share of the exchange in market, was 22.7 %.
80
60
40
20
0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
The introduction of block products for trade on On June 3 2019, European Energy Exchange AG
SEEPEX, was successfully made in March of 2017. (EEX), the leading European energy market, in
Maximum block size was 10MWh and some of close cooperation with SEEPEX a.d. Belgrade,
the standard block orders included - Baseload put futures of electricity with financial
(01-24h), Peakload (09-20h), Off-Peak 1 (01-08h), settlement for the Serbian market area at the
or custom blocks tailored by participants. This disposal of market participants. EEX
business decision, implemented according to introduced basic weekly, monthly, quarterly
members’ needs, provided a sufficient liquidity and annual futures products for the Republic of
increase, resulting in a total traded volume Serbia market. The financial settlement is
increase. In April 2018, the block bids size was performed in relation to the day-ahead spot
increased from 10 MWh to 20 MWh, and at the market price in Serbia, published by SEEPEX.
end of 2019, the procedure of increasing the size On June 18 EEX registered the first trade in
of the block bids to 30 MWh was initiated by the Serbian monthly financial products for July
Organized Market Committee. Realization is 2019, at the price of 51.45 €/MWh.
expected in the first half of 2020.
The cooperation fostered the development of clearing services. This important development,
the Serbian electricity market, which has seen in addition to great importance for the overall
strong growth in 2017 and particularly 2018. All investment framework providing the Serbian
market participants will benefit from the economy with the long-term reference price,
standard product setup which enables them to will also provide SEEPEX additional liquidity
use Serbian Power Futures as a tool to hedge and some new potential members which can
against price risks on the local power spot benefit from this long-term hedging tool,
market, benefitting from high-level standards currently not present in the SEE region.
both in terms of derivatives trading and
Regarding regional development and plans for mitigation, is fair and transparent price
2020, SEEPEX is committed to continue with formation. From the very start of operation
the ongoing market coupling projects and sufficient liquidity obtained in the first few
(coupling with the MRC/4MMC as a first years, the SEEPEX day-ahead market price
priority, new trilateral market coupling could be considered as a reference wholesale
initiative with Bulgaria and Croatia and AIMS market price not only for the Serbian market
coupling project within the WB6 initiative). The area, but for the entire SEE region as well,
main obstacle in the implementation of these providing also a good market place for
projects is the transposition of CACM GL into additional arbitrage with the neighboring EU
Serbian legislation. This issue is expected to be markets (having in mind different GCT).
solved during 2020.
To the Shareholders
of Seepex A.D., Beograd
Opinion
We have audited the accompanying In our opinion, the accompanying financial
financial statements of Seepex a.d., statements give a true and fair view of the
Beograd Company financial position of the Company as at
31 December 2019, and of its financial
the balance sheet as at 31 December performance and its cash flows for the year
2019; then ended in accordance with the
and, for the period from 1 January to accounting regulations effective in the
31 December 2019: Republic of Serbia.
This is a translation of the original Independent Auditor's Report issued in the Serbian language.
All due care has been taken to produce a translation that is as faithful as possible to the original.
However, if any questions arise related to interpretation of the information
contained in the translation, the Serbian version of the document shall prevail.
We assume no responsibility for the correctness of the translation of the Company financial statements.
L.S.