Spanish Outages Likely Cost Top Power User Repsol €170 Million
A nationwide blackout in April led to an estimated loss of roughly €100 million at five refineries, and €40 million at three chemical plants, according to the people, who asked not to be named because the information isn't public. Smaller power failures probably cost about €30 million, they added.
Repsol declined to comment.
The unprecedented collapse of Spain's power grid left more than 50 million people without electricity for several hours across the Iberian peninsula and small parts of France on April 28. The overall financial impact remains unknown, with most industrial, corporate and retail customers waiting for the energy market regulator's review of the debacle before making insurance and damage claims.
The nationwide losses tally could reach between €2 billion and €4 billion, according to power industry executives with knowledge of the estimates, who also asked not to be named discussing non-public information.
The regulator, known as CNMC, hasn't said when it will present its review. A government report last month laid blame at the grid operator and some unnamed power plants, without fully explaining why the network became so unstable in the first place.
Repsol had additional electricity-related losses in the first quarter from a smaller outage that halted its Cartagena refinery six days earlier, as well as a technical problem at a substation operated by a local power company, which led to the Puertollano refinery halting on June 16, the people said.
The smaller April 22 outage was related to power network oscillations — the same type of problem that occurred on April 28.
In 2016, one of Repsol's main refineries suffered an outage and a court eventually ordered the power supplier to pay damages of €18 million.
Repsol consumes close to 2% of Spanish electricity, which likely makes it the largest consumer in Spain.
Production at Repsol's refineries dropped sharply during the second quarter, with so-called destillation utilization — a key sector metric — falling 15% in the three month period, according to the company's latest quarterly trading update.
Repsol is set to report second-quarter earnings on July 24.
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