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Germany's EnBW to spend $13.5 billion in networks, renewables push

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Germany's EnBW to spend $13.5 billion in networks, renewables push
FILE PHOTO: A logo of German power supplier EnBW Energie Baden-Wuertemberg AG is pictured at the companies headquarters in Karlsruhe, Germany March 17, 2015. REUTERS/Ralph Orlowski/File Photo   -   Copyright  Ralph Orlowski(Reuters)
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FRANKFURT (Reuters) – EnBW on Thursday unveiled a 12-billion euro (10.27 billion pounds) investment plan and said it was close to acquiring French renewable group Valeco, as the German utility continues its strategy of moving away from fossil fuels.

The spending plan, covering the 2021-2025 period, mainly focuses on modernising energy and gas networks, its operational backbone due to regulated returns, as well as expanding its generation portfolio, most notably wind and solar.

Those two areas will account for 85 percent of the total investment, EnBW – which is almost entirely owned by the German state of Baden-Wuerttemberg and local municipalities – said at its annual press conference.

“We are concentrating on what we are really good at, which is building and managing complex, large-scale and critical infrastructure safely and reliably,” Chief Executive Frank Mastiaux said.

“Not just in the energy business, but also in other areas,” he added.

In its latest expansion move in the renewables sector, EnBW said it was in exclusive talks to acquire France’s Valeco, which has an installed output of 276 megawatt (MW) and a pipeline of 1,700 MW.

Valeco, which has annual sales of about 50 million euros, is majority-owned by the founding family. French public sector lender Caisse des Depots et des Consignations owns a 35.56 percent stake.

“We see good prospects for common growth in France,” Mastiaux said, adding that the group would also continue to work hard to win projects in the Taiwanese and U.S. offshore wind markets, where it has so far been unsuccessful.

Thinly-traded shares in the group were 2.7 percent higher at 30.80 euros per share, their highest level in more than two weeks, after forecasting an increase in 2019 core earnings of 9-16 percent.

EnBW, which proposed a dividend of 0.65 euros per share for 2018, also said it would take on 3,600 new employees by the end of 2021, which will result in net additions of 300-400 staff, Mastiaux said.

(Reporting by Christoph Steitz and Vera Eckert; editing by Thomas Seythal and Michelle Martin)

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