The largest electrical grid operator in Germany, a state-owned Dutch company, announced Thursday that discussions on selling its German business to the government in Berlin have been called off owing to budgetary restrictions.
In February 2023, TenneT disclosed its intentions for the discussions. With the grid reinforced to handle the move to renewable energy, the German corporation at the time needed a “structural solution” to finance needs, with an expected cost of approximately 15 billion euros ($16.1 billion).
Germany’s aspirations to entirely replace its power generation from fossil fuels with renewable energy by 2045 at the latest depend on the transmission lines. Lack of transmission capacity now prevents some of the electricity produced by northern Germany’s wind turbines from being transmitted south.
TenneT said in a statement Thursday that the German government has now told the Netherlands “it cannot deliver on the planned transaction due to budgetary challenges,”
Currently debating how to create a 2025 budget while following Germany’s strict self-imposed debt limits, Chancellor Olaf Scholz’s three-party coalition is divided. That issue already compelled a hurried, court-mandated review of the 2024 budget, including subsidy cuts that set farmers on fire.
TenneT, who also runs the Netherlands’ grid, said it sees “tapping into public or private capital markets for a structural funding solution for its German operations..” Furthermore mentioned was the German government’s “is committed to support such alternative solutions.”
