50Hertz is to invest almost €23bn in expanding and upgrading its transmission grid in Germany to 2028, to facilitate the energy transition.
This figure is five times more than in the previous five-year regulatory period.
Recently principal shareholder Elia Group announced an equity package of €2.2bn, including a private placement of €850m by investment and pension funds, to support the expansion.
To realise the grid expansion, 50Hertz invested €3.6bn billion last year, which is more than twice as much as in 2023.
The €23bn is being spent on overhead lines, submarine and land cables, substations, digitalisation and other technologies in the fourth regulatory period 2024 to 2028.
The €850m from Elia is to be subscribed by a group of four investors as part of a private placement on the stock exchange.
The group includes the majority shareholder of the Elia Group, Publi-T/Next Grid Holding, ATLAS Infrastructure (together with The Future Fund), BlackRock Inc and CCP Investments.
The new partners have committed to participate in the rights issue of €1.35bn immediately after the closing of the private placement, pro rata to their share in the private placement.
Publi-T/Next Grid Holding remains the largest single shareholder of the Elia Group with 44.79 percent.
Bernard Gustin, the new CEO of Elia Group, said: “This transaction will support the future growth of the Group in Belgium, Germany and international markets.
“It will enable us to implement our investment plan for the next few years.
“50Hertz is and will remain an important pillar in our multinational group of companies, and we as the Elia Group are also a stability factor for the German energy transition.
“We are very pleased to have KfW Bankengruppe as a strong partner in Germany at our side for the challenging years ahead.”
Grid expansion is progressing, with 900 km of power lines under construction.
In the eastern German states as well as Berlin and Hamburg – the control area of the transmission system operator 50Hertz – 73% of the electricity consumed last year came from wind, solar and biomass plants.
At 94TWh, electricity consumption in the 50Hertz grid area in 2024 was the lowest in 20 years due to weak economic development and the low market penetration of electric vehicles and heat pumps.
Wind was the biggest energy source with a share of 44%, while solar covered around 15% of the electricity demand, an expansion of almost 4GW of installed capacity.