E.ON To Divest From Fossil–Nuke Spinoff By 2018
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Germany utility companies E.ON and RWE are now investing heavily in renewable energy, as we’ve previously reported. E.ON operates in about 30 countries and has tens of millions of customers. The company operates six nuclear power plants in Germany, and has about a 30% share of the London Array wind power project. In 2011, it had about 80,000 employees worldwide and is one of the largest investor-owned companies in the world.
We’ve recently reported that E.ON would spin off the part of its company focused on fossil fuels and nuclear power, and create a new company for that side of the business. Now, it has been leaked that E.ON is planning to divest its stake in that new company by 2018. According to Bloomberg, “EON will sell 51 percent of its stake in the new publicly listed company, including an offer of stocks to its existing shareholders, in the second half of 2016 and then divest the remaining stake by 2018, the person said, asking not to be named because the information isn’t public.”
RWE was founded over 100 years ago in Germany. It deals in lignite, hard coal, gas, nuclear power, renewables and pumped storage. In 2006, it had well over 60,000 employees. RWE is reportedly going to invest one billion euros in renewable energy in the next three years.
Although it might seem shocking that two enormous energy companies that heavily emphasize nuclear and fossil fuels would take an aggressive pro-renewable energy stance, Germany is trying to get away from these old and perhaps someday outdated fuel sources.
Some areas in Germany are already close to full, clean, renewable energy production. Germany wants to get to 100% renewables by 2050.
Some might say it can’t be done that quickly; others say it will be sooner. We might expect the rate of change for the future to be similar to what we have observed in the past, with a smooth pace. Perhaps this is because we have a concept of the average in mind, as in an average rate of change. Rates of change can vary though, and can be different from the average over an entire period.
It isn’t easy to say that huge utility companies investing large amounts of money in renewables is a sign of an increase in the rate change, because nothing has been nailed down quantitatively. But it does hint very strongly that a faster shift is approaching.
Increased energy storage might be something that accelerates the rate of change because previously the lack of competitive energy storage had been a physical limit that also appeared to create hesitancy in accepting solar and wind as permanent solutions. But that has also been changing fast.
Of course, fossil fuels will run out eventually, so they too should have some “range anxiety,” but for some reason, they don’t for many people, including investors.
Image Credit: Dipsey, Wiki Commons
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