French energy group Engie continues to increase its clean-energy commitments through another big transaction — the sale of four coal power plants in Germany and the Netherlands to New York-based energy investor Riverstone Holdings LLC.
Three plants with capacities of 350 MW, 472 MW and 726 MW are located in the German towns of Farge, Zolling and Wilhelmshaven, respectively. The fourth plant, which has a capacity of 731 MW, is located in the Dutch city of Rotterdam.
The transaction will likely be finalized in the second half of this year, reducing Engie’s consolidated net financial debt by nearly €200 million, the company said. It will also allow Engie to pursue its coal exit strategy. In 2015, the group announced that it wanted to drastically reduce its production of electricity from coal. Following the sale of the aforementioned plants in Germany and the Netherlands — along with the sale of other coal-fired plants in Australia, Poland and Thailand — coal will represent just 4% of Engie’s total electricity production, from 13% at the end of 2015.
“This transaction is fully in line with the Group’s strategy to be the world leader in the zero-carbon transition,” said Engie CEO Isabelle Kocher. “We are focusing investments on solutions for corporates and local authorities, large-scale development of renewable energy and the necessary adaptation of power and gas networks to the energy transition. We will allocate 12 billion euros to these activities from 2019 to 2021.”
The Dutch government also recently revealed plans to close all of its coal-fired plants by 2030 and will introduce new binding standards for these facilities from 2021. In Germany, the planned closure date for all coal-fired generating capacity has been set for 2038.
Would Engie therefore have had to close its plants instead of selling them, anyway? This is what the Institute for Energy Economics and Financial Analysis (IEEFA) advocated in September 2018 — if only to invest in the collective fight against CO2 emissions, rather than delegate the problem to others.