EON to cut costs of building offshore wind farms 40% by 2015

www.businessweek.com
14 Mar 2012

E.ON AG (EOAN), Germany's biggest utility, expects to cut costs for building offshore wind farms about 40% by 2015 as it embarks on a 7 billion-euro ($9 billion) renewable energy expansion plan. E.ON, which today said that 2011 profit slumped 50% in part on the German nuclear exit and lower earnings from its power generation and wholesale gas business, will commission as much as 800 MWs of renewable capacity this year, Chief Executive Officer Johannes Teyssen said in Dusseldorf. "Renewables are a mainstay of our corporate strategy, and wind power in particular is one of our growth businesses", Teyssen said at company headquarters.

The utility plans to invest 7 billion euros to expand its clean-energy generation capacity in the next five years as German Chancellor Angela Merkel decided to shut the country's nuclear power reactors by 2022 after Japan's disaster. E.ON seeks to build wind farms off the UK, Scandinavia and German coastlines, including the 1-billion euro Amrumbank West project in the North Sea that Siemens AG (SIE), Europe's largest engineering company, will supply with 80 of its wind turbines. "We intend to commission a new offshore wind farm every 18 months", Teyssen said.

E.ON at the end of last year owned about 9 GWs of renewable generation capacity, 4.8 GWs of which were hydroelectric stations. The utility's renewable energy unit saw earnings before interest, tax, depreciation and amortization rise 21% to 1.5 billion euros as more wind turbines were installed.