DRWE Group is accelerating the direction of restructuring Renewable Energy Therefore, preparations are being made for a possible faster exit from coal. The Essen-based power giant plans to adopt a new strategy called “Green Growth” to invest a total of 50 billion euros in its core business other than coal and nuclear energy, which will expire between the end of 2022 and 2030.
The focus is on wind power, photovoltaics, storage and hydrogen. But this also includes generating energy from gas-fired power plants to ensure supply in the absence of sunlight and wind.
For this reason, the expansion of renewable energy is accelerating.want to risk assessment The group’s current goal is to increase its green power capacity by an average of 1.5 GW per year to 2.5 GW per year, an increase of 70%. For comparison: the planned expansion each year corresponds to the output of two to three large coal-fired power plants. The goal is to increase the production capacity of green power to 50 GW. CEO Markus Krebber said: “We also believe that the federal government intends to significantly promote the expansion of renewable energy by accelerating this process.”
Green hydrogen
In the investment plan, carbon dioxide-free “green” hydrogen also plays an important role: by the end of this decade, the company will build its own 2 GW electrolysis capacity. RWE’s goal is to also increase the capacity of its gas-fired power plants. In the long run, the existing system with a capacity of 14 GW will also be converted to climate-neutral fuels such as green hydrogen.
Due to the reorganization of the group, the adjusted operating profit (Ebitda) of the core business (which also includes international energy trade) is expected to increase to 5 billion euros by 2030, which may be twice the current fiscal year. Therefore, RWE predicts that the operating profit of its core business will increase by an average of 9% per year.
The plan is very popular on the stock exchange. This share has increased by nearly 3%, also because RWE has predicted that its operating performance in 2022 will increase by approximately 200 million euros. The planned dividend of 90 cents per share for this fiscal year should also constitute the lower limit for the next few years. In the long run, the distribution will reach 50% to 60% of the adjusted net result. “Most” of the funding for the investment plan comes from current income.CFO says RWE can finance its green growth Michael Muller“Our growth plan is value-added and sustainable.”
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Kreber does not rule out exiting coal-fired power generation early. However, this is a challenge beyond RWE, because the expansion of safe electricity from renewable energy, grids, energy storage, and gas-fired power plants must be vigorously promoted everywhere. The Coal Commission has set the end of coal flow to 2038, and the Traffic Light Alliance is considering 2030.
Rights activist shareholders put pressure on
Investors are also putting pressure on them. Rights shareholder Enkraft called for the divestment of RWE’s lignite business as soon as possible. “In RWE, the elimination of coal started a long time ago. If the continued expansion of new technologies actually accelerates substantially, it may be able to pull him forward,” Kreber said.
One of RWE’s investment priorities is wind power plants on the high seas. The offshore capacity will increase from 2.4 GW to 8 GW. In addition to Europe, the group also focuses on North America and some Asian markets. In terms of onshore wind power and solar power, its capacity will increase from 7 GW to 20 GW, with half of the investment planned in Europe and half in North America.
RWE sees the special potential of photovoltaic power generation, and its capacity will increase from 1 GW to 8 GW. In the total budget, plans to invest 1 to 15 billion euros in Germany. Seven new offices will be opened in Germany for regional operations of onshore wind and solar power, and 200 employees will be employed for project development. Krebber emphasized that RWE will also significantly expand the scope of green energy trade and provide “tailor-made energy solutions” to major customers. RWE also hopes to start importing hydrogen to supply European industries.
