The way in which investment levels in the energy sector will be affected is particularly unclear. For instance, while some projects and investment plans might be unaffected — for instance the Ireland to France electricity interconnector — many other projects are clouded in uncertainty. Some will even run the risk of being entirely cancelled as there are no immediate solutions to it. One of the big problems is that cash is leaving UK funds at a faster rate than they did in the midst of the 2008 financial crisis.
Even though the electricity sector in the UK and EU are enduring tough times, the Stoxx Europe 600 Utilities Index, a benchmark of investor confidence that broadly correlates with the general financial performance of the European energy industry, rose by 19.57% over the period from January 4 to August 1, 2016. The benchmark started at 5,524 points on January 4, 2016, hit its lowest point of 5,353 points on February 23, and steadily grew and ended August 1 with 6,605 points.
At the same time, RWE added more than 38%, thanks to the company's strength that can be seen in multiples areas, such as its revenue growth, increase in profit margins, good cash flow from operations and stable net income. The share price was traded at €11.08 (US$12.94) on January 4, and ended the analyzed period at €15.31(US$17.88).
What the future holds for the electricity sector in the UK and European region remains uncertain. But Britain is certain that is at a peril of losing a huge funding stream for clean energy projects after voting to ditch its EU member status.
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