VIENNA (Reuters) - Vienna's main power company, which has asked the federal government for billions of euros in credit to cover margin costs so it can keep trading on the European power-futures market, denied on Tuesday that it had made speculative trades.
VIENNA (Reuters) – Vienna’s main power company, which has asked the federal government for billions of euros in credit to cover margin costs so it can keep trading on the European power-futures market, denied on Tuesday that it had made speculative trades.
Wien Energie, which provides much of the Austrian capital’s electricity and gas, appealed for help this weekend after the European power market hit record highs, driving up the so-called margin deposits the company must keep on hand to trade.
The City of Vienna, which owns Wien Energie through parent company Wiener Stadtwerke, points to assistance schemes for companies in such situations in neighbouring countries such as Germany, arguing Austria should have such a scheme of its own.
“The interesting thing is that, since the German issue keeps coming up, Wien Energie would probably not have been able to avail itself of this German umbrella scheme because speculation is not allowed at all,” Finance Minister Magnus Brunner, a conservative, told reporters on Tuesday.
Funding talks are taking place in a context of political rivalry between the conservative-led national government and the Social Democrat-led government of the City of Vienna.
Wiener Stadtwerke and the city government rejected Brunner’s accusation.
“There is no speculation at Wien Energie,” Wiener Stadtwerke’s deputy chief Peter Weinelt told a news conference.
European power futures fell on Tuesday to 651 euros ($652) from all-time highs above 1,000 euros on Monday, after European Commission President Ursula von der Leyen said the European Union was working on emergency intervention in the market. In January prices stood at 100 to 150 euros.
Vienna’s finance chief Peter Hanke told the news conference the city was currently in talks with the federal treasury on a credit line of two billion euros although given Tuesday’s price fall it was not needed yet.
($1 = 0.9987 euros)
(Reporting by Francois Murphy; editing by Jason Neely)
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