Talks focus on solar, wind, network projects in UAE, future stake purchase not ruled out
Talks between RWE and an unnamed Abu Dhabi investor are focused on joint renewable energy projects in the Gulf region and are not about the sale of a stake in Germany’s second-largest utility, its chief executive said on Tuesday.
RWE, under pressure from shareholders to tap new growth areas, said in March it was in talks with a Gulf-based investor about several forms of cooperation, adding nothing could be excluded in terms of outcomes.
Asked whether talks were about a stake purchase, RWE Chief Executive Peter Terium said: "No, it's about projects in the region," pointing to solar, wind, networks and wholesale markets as potential areas.
"That, of course, takes time and then it's about the question how they will be financed," he told Reuters on the sidelines of an economic conference in Berlin.
Terium said that potential projects would initially take off in the United Arab Emirates, adding that other markets could not be ruled out. He confirmed that talks could still see the investor, which he declined to identify, take a stake in RWE.
"Nothing can be ruled out in our business," Terium said.
Europe's utilities are grappling with a fundamental shift in their industry marked by a surge in renewables at the expense of conventional power sources, such as coal and gas.
Shares in the 117-year-old RWE, now saddled with some $31.2 billion (27.7 billion euro) of net debt, are down a third so far this year and more than 80 percent since 2007, wiping more than 40 billion euros off its market value.
RWE already has a foothold in the Gulf after forming a joint venture with state-run utility Dubai Electricity & Water Authority (DEWA) in 2012 to provide consulting services to investors, energy suppliers and governments.
Last year, the group won a contract to help Dubai set up an energy agency, whose aim is to boost growth in the emirate via energy efficiency measures.
Dubai, where energy demand grows by about 5 percent per year compared with a stagnant Europe, in January more than doubled its target for renewables in its overall energy mix given the falling cost of solar power.