TenneT Reports Solid Financial Results
- Business & Finance
High-voltage transmission grid operator TenneT continued to provide very high system reliability (99.9999%), benefiting 36 million end-users in the Netherlands and Germany. Financial results in the first half of 2014 were solid. Increases in revenue and EBIT kept pace with the company’s ongoing investments in grid reinforcements and expansions.
Importantly, the Dutch Minister of Economic Affairs also announced his intention to appoint TenneT as grid developer and operator for the offshore electricity grid in the Dutch part of the North Sea. In line with the National Energy Agreement, TenneT expects to construct grid connections for offshore wind farms with a total capacity of 3,450 MW in the Dutch part of the North Sea by 2023, with a required investment volume of EUR 2 to 3 billion.
TenneT CEO Mel Kroon commented:
“We are proud we are able to maintain a system reliability which is among the highest in Europe and to contribute to a more sustainable energy future. Next to our large investments in German renewable energy connections, we are very pleased to be appointed for the development and operation of the Dutch offshore grid. As such, TenneT will not only be the most important investor in the transition to a more sustainable energy supply in Germany but also in the Netherlands. Across borders, we are applying our extensive and unique expertise to provide access to electricity generated by wind farms located near and far shore. Thanks to this know-how we can develop an offshore electricity grid in the Netherlands at lower cost, more quickly, in a structured manner, and with less impact on the environment.”
Sound financial performance in first half 2014
TenneT’s Half-year report for the six-month period ended 30 June 2014 shows that last year’s trend of increasing revenue and EBIT continued during the first half of 2014. Underlying revenue increased by EUR 252 million to EUR 1,138 million and underlying EBIT increased by EUR 131 million to EUR 368 million (Germany EUR 283 million, Netherlands EUR 71 million, Other EUR 14 million). The increase was mainly driven by TenneT’s growing asset base and significant level of investments during the period. During the first half of 2014, TenneT invested EUR 760 million in tangible fixed assets.
Equity further strengthened
On 30 April 2014, TenneT and the Danish infrastructure fund management company Copenhagen Infrastructure Partners (CIP) closed a joint investment transaction in DolWin3, a 900 MW offshore grid connection for wind farms in the German part of the North Sea. CIP purchased a 49 percentage voting interest in this sustainable energy project for a cash consideration of EUR 366 million, leading to a significant increase of TenneT’s equity base. CIP’s total equity commitment to the project amounts to EUR 384 million.
In addition to the planned appointment of TenneT as offshore grid operator in the Netherlands, a number of other noteworthy developments occurred during the first seven months of 2014.
Offshore projects in Germany
TenneT successfully managed to install three offshore converter platforms in the German North Sea for the projects BorWin 2, HelWin 2 and SylWin 1, totalling a capacity of 2,354 MW. By 2020, TenneT expects to have realised at least 7,100 MW of offshore connection capacity, running ahead of the actual targets set by the German government.
A significant expansion of the onshore electricity infrastructure is essential for the transition to a more sustainable energy supply in Germany (the so-called Energiewende). TenneT and TransnetBW have therefore proposed the construction of an 800-km-long direct-current (DC) connection. The SuedLink project is scheduled for completion in 2022 and will transport wind and solar energy from northern Germany to industrial and population centres in the South. SuedLink will be the longest high-voltage line ever constructed in Germany. As the responsible TSO, TenneT is organizing hundreds of local and regional information fairs and meetings for residents living along the entire proposed route, in order to promote dialogue, public participation and acceptance.
Randstad 380 kV North Ring
A similar approach is applied to projects in the Netherlands. TenneT strives to communicate in an open and transparent manner with project stakeholders to create an atmosphere of participation in an early stage. In 2014 TenneT started work on the construction of the so-called North Ring of the Randstad 380 kV project. This is a new 65-km-long 380 kV connection between Bleiswijk and Beverwijk, with a 10-km-long section to be constructed underground.
TenneT is well progressing on two additional future interconnectors, one between The Netherlands and Denmark (COBRAcable) and one between Germany and Norway (NordLink). For NordLink TenneT recently obtained the relevant German onshore licences from the state of Schleswig-Holstein.
Press Release, August 01, 2014