RWE seeks majority share in German grid operator Amprion

German energy company RWE intends to acquire a majority stake in grid operator Amprion, one of the country’s four transmission grid operators. The electricity provider said it wants to contribute to financing the expansion of Amprion’s 11,000 kilometre-long transmission grid, which requires substantial investments to support the energy transition.

RWE plans to increase its existing indirect share in the grid operating company from about 25 percent to 55 percent, a move the electricity provider expects will cost around 3.6 billion euros, newspaper WirtschaftsWoche reported. RWE wants to buy the additional shares from a consortium of pension funds and investors from the insurance sector. The deal is expected to be finalised in September.

“We are delighted with this transaction and see it as a sign of confidence in our strategy and performance,” said Christoph Müller, CEO of Amprion, in a press release. “It is an important step towards financing the major investments ahead and supporting our growth. This investment is therefore good news for the success of the energy transition.”

The decision is connected to RWE’s reported commitment to continue investing a net total of 35 billion euros in the expansion of renewables, battery storage, and flexible power generation by 2031.

Updating the electricity grid is a major hurdle for the energy transition. Germany is in the process of modernising its electricity network for many billions of euros, as it needs to transport renewable electricity from the windy north to industrial centres in the south. Earlier this month, Germany’s grid agency (BNetzA) also urged the country’s four electricity transmission network operators to strengthen the grid instead of their preferred option of relying more heavily on short-term fixes.