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Elia to buy Vattenfall’s German grid for €810m, focus on offshore wind connection

15 Mar 2010

Belgium transmission system operator Elia and infrastructure investor Australian Industry Funds Management (IFM) have agreed to purchase Nordic electricity generator Vattenfall’s German transmission grid for €810m and will work to ensure reliability of supply as offshore wind installations get added to the network.

Under the agreement, IFM will own 40 per cent of 50Hertz Transmission and Elia will have operational control with a 60 per cent stake.

Elia CEO Daniel Dobbeni said both networks are major links for the European power system, which will need to ensure constant supply as variable renewable energy supplies are added going forward.

‘For 50Hertz Transmission this translates into removing bottlenecks and integrating renewables as a major priority while Elia is focusing on managing transit flows and increasing capacity for future offshore wind energy,’ Dobbeni said at a press conference about the deal.

‘Working together, Elia and 50Hertz, towards regional reliability for networks given the massive penetration of variable energy sources such as wind has become a major neccesity for opur region,’ he said.

Dobbeni also said transmission system operators need to remain attractive to both public and private investors and this deal should improve shareholder value.

The transaction, which is expected to close in the second quarter of 2010, is subject to approval from the EU’s competition authorities and the German federal Ministry of Economics and Technology.

Elia was founded in 2001 as an indepdent grid operator and a year later was granted four transmission licences in Belgium. Its network is also linked to France, the Netrherlands and Luxembourg.

IFM executive director Christian Seymour said the deal constitutes the first true infrastructure investment that has been made in Germany.

‘We believe the asset is technically strong, it is a young and well maintained asset. From our persepctive it is a diversification to our assets,’ he said at the event.

Vattenfall Europe CEO Tuomo Hatakka said the process for the sale of 50Hertz began two years ago and it is very pleased to pass on the business to two experienced new owners.

‘They bring together two stregnths that are crucial to us, the neccesary expertise required for operting a tranmsisson grid and also financial spend,’ he said.

Copyright © 2010 NewNet


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