RWE plans to invest 50 billion euros ($57 billion) through 2030 to double its green energy capacity to 50 gigawatts (GW), as Germany’s largest power producer outlined its plan to become a global renewables heavyweight.

However, Markus Krebber – who took over as CEO in May — remained tight-lipped on the future of RWE’s coal-fired power plants, which have been the target of criticism in light of a global push to phase out the polluting energy source.

The investment plan, unveiled on Monday and the largest in RWE’s 123-year history, comes as rival utilities and cash-rich oil majors are muscling in on the renewables sector, all hoping to shift to wind and solar capacity and away from fossil fuels.

Larger European rivals Enel and Iberdrola have already announced funding plans worth a combined 265 billion euros – highlighting the huge sums the sector is mobilizing to raise its green credentials.

RWE’s strategy update follows a major restructuring that saw it take over the renewables activities of former division Innogy and E.ON, turning it into one of Europe’s largest renewables players in the process.

“Our comprehensive strategic transformation has been successfully completed. We are in a great position to actively shape the key decade of the energy transition,” Krebber said.

RWE’s nuclear and coal-fired power plants in 2020 accounted for 31% of the group’s 40.7 GW total installed capacity.

Krebber said that RWE was ready to talk about an accelerated exit from coal, which the parties currently trying to form the next German government are planning, but said there were numerous factors that needed to be considered.

Activist energy investor ENKRAFT has called on management to separate the group’s lignite activities in a bid to cut emissions, sharpen the focus on renewables and boost the group’s share price.

RWE’s investment plan will be funded from its cash flows from operating activities, it said, adding the 0.90 euro-per-share dividend it plans to pay for 2021 will serve as a floor in the coming years. Long-term it aims to pay out 50-60% of adjusted net profit.

Shares in RWE rose as much as 2.1%.

RWE said total investment would average 5 billion euros a year through the decade for offshore and onshore wind, solar, batteries, flexible generation as well as hydrogen, with 90% of that sum aimed at wind and solar power as well as batteries.

Asset rotation, which effectively means the partial sale of activities to bring in external funds, will account for 40% of that sum, bringing the net cash investments RWE plans to spend annually until 2030 to 3 billion euros.

Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) in its core business, which excludes nuclear and coal, is expected to more than double as a result to 5 billion euros by 2030, the company said.

The group also raised its 2022 group adjusted EBITDA target to 3.3-3.6 billion euros from 3.1-3.4 billion previously.

($1 = 0.8737 euros) 

(Reporting by Christoph Steitz Editing by Kirsten Donovan and Mark Potter)

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