The realignment of RWE and E.On will place the two companies – and Germany as a whole – at the heart of Europe’s energy transition, their respective chief executives have said.
Last weekend RWE and E.On confirmed they had reached an agreement on an extensive and complex asset swap that would radically change both their businesses and that of RWE subsidiary innogy.
Innogy is to change hands and become part of E.On, while RWE is to inherit E.On’s renewables business as well as 17.6% of E.On’s share capital.
Johannes Teyssen, chief executive at E.ON SE, described the deal yesterday as “one of the most creatively designed deals in German industrial history”.
However both Teyssen and his RWE counterpart Rolf Martin Schmitz were keen to stress at yesterday’s press conference that the “realignment” of the two firms was about making the energy transition across Europe a success.
E.On’s disposal of its renewables business and acquisition of innogy will see it double down on its focus on customer solutions and networks. Teyssen said this was about placing consumers at the heart of the energy transition.
“We at E.On believe that the new energy world will be about the independence and autonomy of our customers. The ongoing electrification of the entire economy will also increasingly drive a green, sustainable and climate-friendly future,” he said.
But perhaps more pertinently Teyssen, who said the deal posed the first significant leap in growth for E.On in more than a decade, said the transaction posed an opportunity for it to become the “first company to break away from the circle of established European energy suppliers” and to focus on the “varied possibilities of the energy world”.
On the subject of its decision to exchange its renewables business to RWE, Teyssen said its targets would be achieved much quicker in the hands of its prospective new parent than in its existing structure.
Schmitz meanwhile said the transaction was a “compelling proposition” for RWE, particularly given its potential to combine conventional generation with renewables, a combination made possible by its trading platform.
“Conventional and renewable energy are two sides of the same coin. They are inextricably linked together, this is something we have said time and time again. This move puts us in an excellent position in both markets in one fell swoop, and our trading platform is the ideal link between the two,” he said.
Post-transaction, RWE will become the third largest renewables firm in Europe with an installed capacity of wind, hydro and solar generation in excess of 8GW. A further 1.5GW of offshore wind is either under construction or in advanced planning stages.
That position, Schmitz said, would only be matched “by a handful of companies in Europe”, and allow RWE to play a central role in energy supply.
“RWE will continue to be the safety net of the energy transition. Our flexible generation fleet provides stability for an energy system that has to digest an increasing amount of volatile feed-ins of wind and solar power. We intend to grow and selectively supplement our portfolio, especially in gas,” he said.
“We’re moving full steam ahead and know exactly what we want, and that’s to position RWE as a leading power producer. Not just today, but tomorrow and the day after as well.”