[CWN] German utility RWE expects to spend heavily in the U.S. green energy market as it maps out its future as a global renewables champion after its pending asset swap with peer E.ON.“We expect to spend several billions of euros on the expansion of the U.S. renewables business in the next few years,” chief financial officer Markus Krebber told Reuters in an interview.
RWE is trying to shed its image as coal-heavy, closing many of its German plants in return for compensation that is yet to be negotiated, and has demonstrated the bulk of its future profits will come from renewables.
Krebber said its global spending would focus on onshore wind and photovoltaics (PV) in the United States and Europe, where offshore wind spending would be significant too, with PV also highly relevant in Australia.
By taking over the renewable energy assets of subsidiary Innogy and of E.ON within the sector carve-up, RWE will develop into Europe’s third-biggest renewables company and the world’s number five, with installed capacity of 10 gigawatts.
Globally, “we will invest more than 1.5 billion euros (per year), and this could be as much as 2.5 billion euros with partners’ money”, Krebber said.
RWE on Wednesday increased its credit line with a consortium of 27 international banks to 5 billion euros ($5.7 billion) in order to fund the renewables business integration.
In the United States, it will inherit a 3 GW renewables portfolio from its two German peers and seek to expand that to 8 GW.
The main emphasis would be on onshore wind between the Great Lakes and down to the Gulf of Mexico, Krebber said.
RWE would develop and construct the assets itself, not invest in existing ones.
Investment conditions in U.S. renewables are attractive because prices for plants have come down, while remuneration for production will be lucrative even after federal tax credits expire.