RWE after completing a massive asset and share swap deal with rival German utility E.ON will have a renewable energy project pipeline of approximately 20GW, with 2.6GW already under construction, the company said at the presentation of nine months 2019 results.

As part of the deal, E.ON has already transferred 4.7GW in renewables capacity (3.7GW onshore wind and 1GW offshore wind) to RWE, and early next year is slated to also return the renewable generation assets of former RWE subsidiary Innogy back to RWE.

As a result, the new unit RWE Renewable Energy will bundle more than 9GW of green generation capacity, which the company pledges to expand through €1.5bn in net investments every year.

“RWE is profitable in operating terms and we have a very solid equity base,” chief financial officer Markus Krebber said.

“Our finances have put us back into a position to achieve growth – above all in the renewable energy business where we have formidable prospects.”

In recent weeks, RWE had already embarked on new wind and solar projects in the US, the UK and Poland, where it acquired a 1.5GW pipeline of four offshore wind projects around the Slupsk sand bank area in the Baltic Sea.

RWE’s pro-forma earnings before interest, taxes, depreciation and amortisation (Ebitda) in the renewable energy business through the end of the year will reach €1.3-1.5bn ($1.43-1.65bn), the company said in a presentation. Roughly half of that income will come from continuing operations at Innogy, and the other half from the renewables assets taken over from E.ON.

Not included are E.ON's 20% state in UK offshore wind farm Rampion, or hydro or biomass assets.

RWE has raised its Ebitda guidance for the entire company to €1.8-2.1bn from €1.4-1.7bn previously envisaged, due to a reinstatement of the British capacity market and a continued strong trading performance. The utility also raised its net income guidance to €0.9-1.2bn (from €0.5-0,8bn seen previously).

Nine months financial figures at RWE do not fully reflect the new company as, for example, operations acquired from E.ON are not fully included in operating results, and the deconsolidation of Innogy’s grid and retail activities led to a massive capital gain of €8.3bn.

In consequence, the group’s net income jumped to €9.1bn in the first nine months of 2019, compared to a net loss of €65m in the year-earlier period.

Krebber during a press conference criticised government plans to introduce a rigid distance rule of 1km between new onshore wind farms and settlements of as little as five buildings.

"The distance rule foreseen by the federal government will ... render the wind build-up more difficult," he said, adding that without a significant expansion of onshore and offshore wind, Germany cannot reach its 65% renewable power target by 2030.

Renewable, wind and energy groups, as well as trade unions and Germany's powerful industry federation BDI have all warned the distance rule planned to be cemented by a cabinet approval next week could derail the country's Energiewende (energy transition).

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