In this article, we talk about the 3 European coal stocks to buy as Russia squeezes gas supply. If you want to read our detailed analysis of the energy sector in Europe and its current situation, go directly to 8 European Coal Stocks to Buy As Russia Squeezes Gas Supply.
3. CEZ, a. s. (PX:CEZ.PR)
CEZ, a. s. (PX:CEZ.PR) is an energy company based in Prague, Czech Republic. It has more than 7 million customers and 28,000 employees across Europe, ranking it among the 10 largest energy companies in the EU. It deals in the production and transmission of electricity and heat, the purchase and sale of natural gas, and coal mining. Since its inception, CEZ, a. s. (PX:CEZ.PR) has paid out more than 343 billion Czech crowns to its shareholders as dividend payments.
The company generates electricity through a variety of sources, and is the largest producer of electricity from renewable energy sources in the Czech Republic. It also boasts 165 MW power generating capacity from wind energy parks in Turkey, Germany and the Czech Republic. But a large part of the company’s portfolio consists of coal power plants. In total, CEZ, a. s. (PX:CEZ.PR) runs 10 coal-fueled power and heating plants across the Czech Republic and Poland.
The Czech Republic is the fifth-largest net exporter of electricity in the European Union, meaning it has the ability to produce more than its own requirement of power. Many environmentalists have therefore criticized CEZ, a. s. (PX:CEZ.PR) for its continued reliance on coal plants over the years. But now CEZ has the potential to stabilize European energy markets at a time of great crises, making it a good European stock to buy now.
2. Ze Pak Sa (WSE:ZEP)
Ze Pak Sa (WSE:ZEP) is the fourth largest energy producer in Poland. Billionaire Zygmunt Solorz owns a majority stake in the company, which has in recent years made pledges to wean off its coal usage. In 2019, around 90% of the company’s total energy production came from lignite (brown coal) sources. In accordance with UN climate agreements, Ze Pak Sa (WSE:ZEP) has announced that it will shut down all its lignite plants by 2030, making it the first fossil fuel company in Poland to commit to a coal phase-out plan within this decade.
However, recent developments in Europe have put coal in the limelight again, and as a firm with significant exposure to the coal industry, Ze Pak Sa (WSE:ZEP) is one of the best European coal stocks to buy in the current climate.
1. Endesa, S.A. (BMAD:ELE)
With a €19.94 billion market cap, Endesa, S.A. (BMAD:ELE) is the largest electric utility company in Spain, with operations in multiple countries across Europe. It provides electricity to 10 million customers mainly in Spain and Portugal, and on a relatively smaller scale to customers in Germany, France, Belgium and the Netherlands. By end of 2020, Endesa’s energy production from renewable sources such as wind, solar and hydroelectric had reached 7,825 MW. The company has promised to phase out all its coal-based power plants by 2027, and has dismantled and shut down several of these in recent years. Endesa has also established a Futur-e Plan, which seeks to address issues caused by plant shut-downs to the local community, and help workers find employment again through green energy initiatives within the same area.
The energy crunch faced by Europe has upended its green energy ambitions, at least in the near term. In November 2021 amid excessive demand for electricity in Spain, Endesa, S.A. (BMAD:ELE) was made to restart a coal pant which had been idle for months and was awaiting a full shut-down. This was the As Pontes coal plant in the northwestern Galicia region, which boasts a 1,400 MW power generation capacity.
For the first quarter of 2022, Endesa, S.A. (BMAD:ELE) disclosed revenue of €7.51 billion, up 60.84% in comparison to the same period over last year. Net income was recorded at €338 million, down 31.16% on a year-over-year basis.
You can also take a look at 10 Best Gold Stocks To Buy Now and 10 Biggest Solar Companies.
