German utility giants make renewable pledges

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Renewables will be a focus of German energy companies E.ON and RWE, according to their earnings reports for 2014.

E.ON’s EBITDA and underlying net income figures were within the expected amounts, reported the company.

According to the company, which announced last year that it would focus on renewables in the future, the lower figures for 2014 can be attributed to the “persistently difficult situation on energy markets in Germany and Europe as well as currency-translation effects and portfolio changes”. The company has reported an EBITDA of €8.3 billion (around US$8.79billion) – the prior year was €9.2billion – and an underlying net income of €1.6 billion (around US$1.69billion), as compared to €2.1billion the previous year.

The company’s solar and wind had a good performance (+20%), the statement reports.

Klaus Schäfer, CFO of E.ON, stated: “Going forward, E.ON will focus entirely on renewables, energy networks, and customer solutions.” The company will combine its other businesses, including conventional power generation (hydro and operations in Russia), global energy trading, and oil and gas productions, as an independent company under a new name.

RWE has also successfully made its earning targets for 2014, with a reported €1.4billion, €400million of which was earned in 2014. According to the company, that is €250million more than expected. However, the lower earnings from conventional electricity generation was not remedied by this.

RWE attributes the decline to “persistently low prices on the wholesale electricity market and the unusually mild weather.”

The company claims that renewables will be “a focal point” of capital expenditure. RWE plans to invest €1billion in the next three years.

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