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Innogy ramps up energy innovation investment as earnings fall

Germany-headquartered utility innogy has backed a renewed investment in innovation to return it to growth after earnings fell 10% in the year following its IPO.

The company, which trades in the UK as nPower, witnessed its EBIT fall 10% year-on-year to €2.7 billion (£2.35 billion), a collapse which the company blamed on higher than expected network infrastructure costs and lower wind speeds which impacted upon its renewables division.

However Peter Terium, chief executive at innogy, said investors can expect a return to growth in the following year after making a “precision landing”, insisting that the company had kept promises it made for 2016.

Innogy also revealed that a major investment in innovation and new technologies would underpin its place in the transitional energy economy. As much as €7 billion (£6.1 billion) is to be strategically invested across its three core divisions – renewables, grid & infrastructure and retail – over the course of 2017-2019.

Those investments are to fall into three strategic areas pinpointed by innogy as crucial for its future work, namely the decarbonisation, decentralisation and digitalisation of its services.

An innovation hub established within the company collaborates with around 180 manufacturers, universities and researchers, and has already resulted in a number of new products and services being released to innogy customers.

These are predominantly focused on innogy’s home market of Germany, however many could transition over to UK customers.

Notable products and services include Lemonbeat, a digital transmission protocol developed to connect multiple household appliances; bit.B, a service established to optimise energy efficiency in SMEs; eCarSharing, which offers electric car leasing and management to fleet operators; and ‘Fresh Energy’, a combination of a 100% renewables tariff, smart meter and smartphone app offered to consumers.

Innogy is also working on a number of high-level grid and infrastructure projects, most notably ‘Designetz’, a four-year, joint research venture in Germany established to more proficiently connect variable renewables generators to transmission grids.

Started in January this year, innogy leads a consortium of 45 other partners which will work across 30 sub-projects including a number of field trials with the aim of better incorporating and managing large numbers of decentralised rural generators (i.e. solar, wind and battery storage) into urban networks.