E.ON Plans Massive Investment In Renewable Energy In Russia

Company plans to invest $10.9 billion in renewable energy sources.

German energy company E.ON, which recently failed to get its hands on Spanish electricity supplier Endesa, plans to invest massively in the renewable energy sector and in Russia, chief executive Wulf Bernotat said April 18. After trying to get its hands on Endesa for more than a year, E.ON ceded victory earlier month rival bidders Acciona of Spain and Enel of Italy, settling instead for 10 billion euros worth of key assets.The assets include all of Endesa's European assets outside Spain, Enel's Spanish unit Viesgo and additional Spanish generation capacity from Endesa

E.ON planns to invest eight billion euros (US$10.9 billion) in renewable energy sources in the next five years and in ways to cut its own energy consumption, Bernotat said.

E.ON also planns to expand in Russia where the electricity sector was in the process of being privatised, Bernotat continued. Around 20 companies were set to be wholly or partially privatised in the near future and the German group planned to make a decision by the end of April on which companies it would be interested in. E.ON was not ruling out cooperating with Russia gas giant Gazprom, which is also eyeing the Russian electricity sector.

Following its failed attempt to buy Endesa, E.ON is sitting on a huge cash mountain. Analysts at Citigroup estimate E.ON could have up to 30 billion euros to spend on acquisitions.

Copyright Agence France-Presse, 2007

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