Eon is investing billions in the energy distribution network

Eight months after taking office, Eon CEO Leonhard Birnbaum prescribed a billion-dollar growth package for the group. Germany’s largest energy supplier Eon is to invest around 27 billion euros by 2026, mostly in the expansion of the energy distribution network. "Eon is now starting a comprehensive growth and investment offensive to build a CO2-free, digital energy world," said the 54-year-old. At a "capital market day" for investors, the chemical engineer promised shareholders an annual growth in earnings before interest, taxes, depreciation and amortization (Ebitda) of around four percent to finally around 7.8 billion in 2026. Eon is Germany's largest electricity and gas provider and by far the largest distribution network operator. In Europe, the group had more than 52 million customers at the end of June, 14 million of them in Germany. Eon plans to invest 22 billion of the 27 billion euros in the expansion of the energy network. These electricity and gas networks are regulated. This means that in Germany, for example, the Federal Network Agency stipulates the conditions under which and at what price electricity and gas providers can use the networks for delivery. According to its own statements, the authority ensures "that the network operators can master the major tasks of the energy transition without placing excessive financial burdens on consumers". Eon expects to connect additional renewable energies with a capacity of 35 to 40 gigawatts to its own grids in the next five years. "Each of these systems helps us to achieve the Paris climate goals. In addition, there is the expansion of millions of heat pumps, battery storage and electromobility," said Eon board member responsible for networks, Thomas König. The company plans to invest around 2 of the 22 billion euros in the digitization of network planning, monitoring and control. Eon intends to invest the remaining 5 billion euros in expanding its business with so-called customer solutions, i.e. the sales area. "Digitization is the decisive factor here as well: We will have a digital platform in all markets by 2026 and use it to serve all of our customers efficiently and in a customer-friendly manner," said Patrick Lammers, the board member responsible for sales. Eon also wants to earn money with sustainable energy systems in houses and in e-mobility. The company announced the construction of around 5000 fast charging points by 2026. Eon sees further growth potential in the hydrogen economy. The company is primarily focusing on industrial medium-sized companies. The company confirmed its dividend policy. Eon is proposing a dividend of 49 cents per share for 2021 (previous year: 47 cents). The annual dividend per share is expected to grow by up to 5 percent by 2026.