RWE has cut its 2025-2030 renewable energy investment budget by €10 billion
It plans to adopt a cautious and stricter approach to its long-term investments in wind, solar and storage, among other technologies
Project commissioning contributed to the onshore wind/solar segment recording €1.5 billion in adjusted EBITDA in 2024, up from €1.2 billion in 2023
German energy group RWE has cut its net investment budget for renewable energies by roughly €10 billion ($10.8 billion) or 25% for the 2025-2030 period, citing uncertainties in the global investment environment. Its revised investment target is now €35 billion for these years.
“Continued high inflation and rising interest rates, constraints in supply chains, geopolitical tensions, possible additional tariffs and possible adjustments in the direction of energy policy in our core markets – these are risk factors that need to be taken into account when deciding on new investments,” explained the management.
Adopting a cautious approach, the German energy major said it will resort to stricter risk management for new investments. Since multi-billion-euro investments in new wind and solar farms, energy storage systems, electrolyzers and power plants are made over decades, these require ‘stable, reliable framework conditions.’
Referring to US President Donald Trump’s decision to suspend any federal permits for offshore wind projects and conduct a review of new wind farms, RWE said, “It is impossible to predict the consequences of the change of course in US energy policy for the expansion of renewable energy in the USA at this time.”
For the German market, RWE offered some recommendations to ensure the security of supply and economic efficiency. These include competitive tenders for new gas-fired power plants ‘as soon as possible’ and remuneration for renewables to be market-based.
“Fixed feed-in tariffs must be abolished. Compensation is no longer justified during hours when electricity prices are negative. Further expansion should be based more on own commercialisation or longterm supply contracts,” suggested the management.
On the financial front, RWE reported an adjusted EBITDA of €5.7 billion ($6.2 billion) and a net income of €2.3 billion ($2.5 billion) for fiscal 2024, both exceeding the forecast. The onshore wind/solar segment recorded €1.5 billion ($1.6 billion) in adjusted EBITDA, having increased over €1.2 billion ($1.3 billion) in the previous year, mainly due to the commissioning of new projects. RWE’s adjusted EBITDA excludes phaseout technologies, namely lignite-fired power generation and nuclear decommissioning.
Last year, it made a €10 billion net investment in offshore and onshore wind farms, solar farms, battery energy storage systems (BESS) and electrolyzers, while commissioning around 2 GW of capacity.
For fiscal year 2025, RWE expects an adjusted EBITDA of €4.55 billion to €5.15 billion ($4.9 billion to 5.6 billion) and an adjusted net income of €1.3 billion to €1.8 billion ($1.4 billion and $1.95 billion).
Currently, the company has some 150 projects in 11 countries representing around 12.5 GW capacity under construction, with 26% comprising solar projects. About 75% of this capacity is scheduled to come online by the end of 2026.