News: TenneT Corporate Website https://www.tennet.eu/?L=0 en TYPO3 News Tue, 04 Aug 2020 22:12:07 +0200 Tue, 04 Aug 2020 22:12:07 +0200 TYPO3 EXT:news news-2156 Fri, 31 Jul 2020 08:45:00 +0200 Investments rising to EUR 4-5 billion a year in the next years - TenneT scaling up for European energy transition https://www.tennet.eu/news/detail/investments-rising-to-eur-4-5-billion-a-year-in-the-next-years-tennet-scaling-up-for-european-ener/ TenneT invested EUR 1,408 million in the Dutch and German high-voltage grids in the first half of 2020, a 30% increase compared to the first half of 2019 (EUR 1,094 million). Underlying operating result (EBIT) increased to EUR 414 million in the first half of 2020 (first half of 2019: EURO 407 million). TenneT is scaling up its organisation to invest EUR 4 to 5 billion annually to connect renewable energy sources and develop a borderless European electricity market. In July 2020, TenneT strengthened its balance sheet by issuing EUR 1 billion of green hybrid securities. Talks with the German government about a potential equity participation next to the Dutch State are on-going.
  • TenneT invested EUR 1,408 million in the Dutch and German high-voltage grids in the first half of 2020, a 30% increase compared to the first half of 2019 (EUR 1,094 million).
  • Underlying operating result (EBIT) increased to EUR 414 million in the first half of 2020 (first half of 2019: EURO 407 million).
  • TenneT is scaling up its organisation to invest EUR 4 to 5 billion annually to connect renewable energy sources and develop a borderless European electricity market.
  • In July 2020, TenneT strengthened its balance sheet by issuing EUR 1 billion of green hybrid securities.
  • Talks with the German government about a potential equity participation next to the Dutch State are on-going.
  • Despite the corona pandemic and due to extensive measures taken to ensure a safe and healthy work environment, TenneT made good progress in managing the complexity of connecting growing amounts of renewable electricity to the grid. At the same time, TenneT maintained a high security of supply of 99.99 percent for 42 million end users across the Netherlands and Germany.

    Further integration pays off

    TenneT, as Europe's first cross-border TSO, continued to facilitate the development of a borderless European electricity market. TenneT increasingly benefits from its integrated grid planning, management and operations approach. Manon van Beek, CEO: "Sharing best practices and lessons learned between our German and Dutch operations is paying off more and more in terms of an integrated approach to offshore and onshore grid expansion, better grid utilization due to European innovations and cross-border energy system planning."

    Offshore, TenneT is on track to move the energy transition in the Netherlands forward making use of  its extensive experience in Germany. Borssele Alpha recently saw its first power delivered by the neighbouring wind farm. Borssele Beta has become operational end of July, well before the formal delivery date of 31 August 2020. Therefore TenneT has now got fourteen offshore grid connections in operation, twelve in the German and two in the Dutch North Sea. The 12th offshore grid connection in Germany, Borwin 3, was completed in the first half of 2020. This brings the total connection capacity in the German part of the North Sea to over 7 GW, exceeding the German government's sustainability target of 6.5 GW by the end of 2020.

    In order to reduce the impact of AC lines and to increase the public acceptance of those projects, Germany recently decided to start a couple of 380kV AC underground cabling pilots. TenneT benefits from the experience it gained in the Dutch Randstad with the construction of 380 KV underground AC lines. Furthermore this experience is also transferred to the large DC corridor projects like SuedLink and SuedOstLink. These huge -TenneT’ s largest-  projects, which will be built completely underground, will be crucial to transport northern wind production to meet demand for electricity in southern Germany.

    Scaling up and unlocking flexibility through innovation

    “We’ve proven to be resilient to the challenges posed by the corona pandemic,” says Van Beek. “Our construction work on onshore and offshore electricity connections is progressing. As well as maintenance. Our investment agenda increased by 30% in the first half year."

    On top of all grid expansion and maintenance efforts, TenneT is also investing heavily in innovations to better utilize and optimize the capacity and flexibility present in the existing electricity grids. In April, TenneT together with Terna (IT) and Swissgrid (CH) launched Equigy, a new European crowd balancing platform, supported by blockchain technology. This platform will enable millions of European prosumers to actively offer flexible capacity of their electric cars, domestic batteries or solar panels to grid operators for the stabilisation of the electricity system and thus financially benefit from the energy transition.

    Van Beek continues: "On 1 July, we launched a new organisational structure with a new senior leadership team that will support the company’s growth and its role in the energy transition in the Netherlands, Germany and neighbouring countries. New departments will further focus on strategic partnerships, digitalization and energy system planning. The new organisation marks an important milestone in TenneT' s transformation, which also includes a sharpened strategy and more focus on leadership and culture.

    TenneT expects to scale up to an annual invest volume of EUR 4 to 5 billion within the next few years. CFO Otto Jager explains: "We are going to connect growing amounts of renewable electricity to the grid while facilitating the development of a borderless European electricity market. In light of future equity funding needs, the ongoing talks with the German government about a possible equity participation, next to the Dutch State, are welcomed by TenneT."

    Financial results and outlook

    TenneT’ s financial performance in the first half year of 2020 remained solid. Underlying revenue of EUR 2,319 million increased by 7.1% compared to 2019 (EUR 2,166 million), mainly driven by a growing asset base and additional compensation for grid-related expenses. Underlying EBIT increased by EUR 7 million to EUR 414 million in the first half of 2020 (first half 2019: EUR 407 million).

    Key underlying results (1)

     

     

     

     

     

     

     

    EUR Million

     

    30 June 2020

     

    30 June 2019

     

    Revenue

    2.319

     

    2.166

     

    EBITDA

     

    960

     

    877

     

    EBIT

    414

     

    407

     

    Investments

     

    1.408

     

    1.094

     


    In March 2020, TenneT raised EUR 250 million of funding from the European Investment Bank. The financing is linked to TenneT’ s Southwest 380 kV-west project, which will bring wind energy from the North Sea to users in the Netherlands and beyond.

    In May 2020, S&P and Moody’s confirmed TenneT’ s A- / A3 long-term unsecured credit ratings, with a stable outlook.

    In July 2020 TenneT issued EUR 1 billion of Green Hybrid Securities to further strengthen its balance sheet for the coming years, as 50% will be classified as equity by the credit rating agencies.

    Jager commented: “With the hybrid issuance, we have a robust capital structure for the coming years, but, given our growing investment programme, it is prudent to already now look further ahead for additional equity capital as we are currently doing in cooperation with the Dutch and German state.”

    Read more

    Find the Half Year Report 2020 here.

    (1) Contrary to IFRS, ‘underlying’ figures recognise regulatory assets and liabilities in connection with TenneT’s regulated activities whereas IFRS does not allow this. This means that amounts resulting from past events and which are allowed or required to be settled in future grid tariffs are recognized separately.  

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    news-2144 Thu, 16 Jul 2020 10:05:01 +0200 TenneT sparks the hybrid market with a EUR 1 billion Green Hybrid Bond https://www.tennet.eu/news/detail/tennet-sparks-the-hybrid-market-with-a-eur-1-billion-green-hybrid-bond/ Investors show keen interest: issue 2.5 times oversubscribedGreen Hybrid further strengthens TenneT' s balance sheetLargest corporate green debt issuer in the Netherlands, with over EUR 9 billion issued 
    • Investors show keen interest: issue 2.5 times oversubscribed
    • Green Hybrid further strengthens TenneT' s balance sheet
    • Largest corporate green debt issuer in the Netherlands, with over EUR 9 billion issued 

    TenneT Holding B.V. (rated A3/A-) yesterday successfully priced a Green Hybrid Bond issue of EUR 1 billion with a coupon of 2.374% and a non-call period of 5.25 years. The issue will further strengthen TenneT' s balance sheet as it will receive 50% "equity credit" from the credit rating agencies. Proceeds will be used to invest in green projects in the Netherlands and Germany to connect large scale offshore wind to the onshore electricity grid and to enhance the onshore transmission capacity for renewable energy. The transaction was supported by ten banks: BNP Paribas and HSBC as joint structuring advisors and joint lead managers, Deutsche Bank and ING Bank as joint lead managers and ABN AMRO, Commerzbank, Lloyds Bank, NatWest Markets, Rabobank and SMBC Nikko as passive bookrunners.

    Investing in green energy

    In order to implement the sustainable energy policies of the Netherlands and Germany, drive the energy transition and carry out large-scale maintenance work on our high-voltage grids, TenneT' s annual investments are expected to grow from approximately EUR 2 to 3 billion today to approximately EUR 4 to 5 billion within the next five years.

    The majority of TenneT' s investments are directly related to the increase in renewable energy sources, such as wind and solar energy. In the period up to 2030, TenneT expects to have realized approximately 28 gigawatt (GW) of connection capacity for offshore wind farms in the Dutch and German parts of the North Sea, transmitting an amount of electricity sufficient to power 38 million households for a full year.

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    news-2057 Thu, 12 Mar 2020 10:51:36 +0100 TenneT preparing to meet European energy system challenges https://www.tennet.eu/news/detail/tennet-preparing-to-meet-european-energy-system-challenges/ TenneT's efforts to drive the energy transition, one of its strategic priorities, are increasingly focused on innovation, optimisation of the current high-voltage infrastructure and close cooperation with stakeholders like governments, society, other grid operators and market parties TenneT's efforts to drive the energy transition, one of its strategic priorities, are increasingly focused on innovation, optimisation of the current high-voltage infrastructure and close cooperation with stakeholders like governments, society, other grid operators and market parties

    •  In 2019 TenneT invested EUR 3.1 billion  in the energy transition and security of supply (99.9998% grid availability in 2019)
    • TenneT is preparing the company to facilitate an annual investment portfolio of EUR 4 – 5 billion to drive the energy transition
    • Underlying revenue amounted to  EUR 4.1 billion; EBIT (excluding special items) amounted to EUR 753 million
    • Social acceptance of new infrastructure, availability of equity financing and availability of the supplier market are crucial to TenneT's pivotal role in the energy transition.

     

    TenneT's efforts to drive the energy transition, one of its strategic priorities, are increasingly focused on innovation, optimisation of the current high-voltage infrastructure and close cooperation with stakeholders like governments, society, other grid operators and market parties. This is stated in the 2019 Integrated Annual Report that was published today by the Dutch/German transmission system operator TenneT. In line with the energy policies and national climate targets in TenneT's home countries, the Netherlands and Germany, TenneT also stepped up its investments in the energy transition in 2019.

    Clear strategic direction defined

    The report highlights TenneT's progress on a renewed strategy adopted in 2019, based on four pillars: Driving the energy transition, Maintaining security of supply, Energising our people & organisation and Safeguarding our financial health. In 2019 TenneT also posted solid financial results, to some extent affected by less favourable regulation particularly in Germany. A stable development of the profitability of TenneT's regulated activities is necessary for carrying out its extensive investment programme for the energy transition in the years ahead.

    Manon van Beek, CEO TenneT: "For TenneT, 2019 was both a successful and a challenging year. In 2019 we started the internal process for 'changing for growth' to prepare TenneT for its central and increasing role in the European energy transition and a new energy system. We have now successfully fully integrated the structure of our cross-border organisation, including the creation of several hundreds of new jobs across the company. We can be proud of that. The same applies to the availability of our high-voltage grids which improved slightly to 99.9998 percent, keeping our grids among the most reliable in the world. Financially, we delivered a solid performance in line with the expectations of our capital providers. Our EUR 3.1 billion investments are supporting the energy policies in the Netherlands and Germany. We have made great strides again in pursuing our ambition to achieve a sustainable energy future for everyone. Not only in realising and developing new onshore and offshore connections, but also by the required far-reaching international cooperation and working on innovations in close coordination with relevant stakeholders."

    KEY ACCOMPLISHMENTS IN 2019 DRIVING THE ENERGY TRANSITION

    Approximately one sixth of TenneT's total investments in 2019 were allocated to the maintenance of the existing high voltage grids; the other part was earmarked for newly built projects and grid expansions. A number of important projects to maintain the high security of supply and to drive the energy transition were completed or showed good progress in 2019.

    Unlocking new sources of renewable energy

    In 2019, TenneT already met and even exceeded the German government’s 2020 6.5 GW expansion target for sustainable North Sea and Baltic Sea wind power. BorWin 3, TenneT's ninth offshore direct current connection, has been commissioned. DolWin5, DolWin6 and BorWin5 are in development and will increase TenneT's transport capacity for wind farms in the German North Sea to almost 10 GW by 2025. After 2025 TenneT additionally plans more than 6.5 GW of transmission capacity to be installed by 2030. So TenneT is well prepared to meet future offshore goals as Germany's northern states and federal government want to more than double the country's installed offshore wind power capacity (North Sea and Baltic Sea) within ten years with a new expansion target of 20 GW by 2030, instead of the earlier goal of 15 GW.

    Borssele Alpha, TenneT's first alternating current (AC) offshore platform on the Dutch part of the North Sea, was installed on schedule and is now ready for use. Another seven of these 700 MW standardized platforms will be delivered by 2027 for connecting future offshore wind farms to the onshore grid. The next offshore connection system, Borssele Beta, will be completed by 2020. TenneT expects to have realised a total of almost 10 gigawatts (GW) of offshore connection capacity by 2030 in the Dutch North Sea. For the IJmuiden Ver wind area TenneT expects to use two 2 GW converter platforms in combination with 525 kV cable. A world's first, this new standard saves on costs and ensures a smaller spatial footprint.

    Offshore wind has a major impact on the onshore grid

    The energy transition can only be successful if the growth of offshore wind energy and onshore solar energy is developed in an integrated way with onshore grid expansions.

    Important steps were taken in 2019 in the planning and licensing phase for SuedLink, the North-South connection in Germany. The preferred corridor for this 2 x 2 GW underground (DC) cable connection was presented followed by extensive stakeholder dialogues and approval procedures being started. This corridor is planned to run from Schleswig-Holstein to Bavaria and Baden-Württemberg. TenneT and fellow German TSO TransnetBW launched EU-wide tenders for the convertor stations, key components of the project.

    TenneT is working in Germany on more large-scale onshore high-voltage connections than ever before. No fewer than eight high-voltage lines are under construction, including Wahle-Mecklar (230 kilometres), Mittelachse and the Westküstenleitung, which transport large amounts of wind energy from the north to end users further south.

    After five years of construction, the 60-kilometre-long Randstad 380 kV North Ring connection was commissioned. The new transmission line delivers a reliable electricity supply to millions of households and companies in the Dutch Randstad region. Moreover, this power highway will provide the required transmission capacity for green electricity produced by North Sea wind farms. Other large projects in preparation or under construction are Zuid-West 380 kV Oost and West, Eemshaven-Vierverlaten and increasing the capacity of the national 380 kV ring.

    Energy transition only successful with a European approach

    With the 'green' COBRA cable, which became operational in September 2019, the Dutch and Danish markets are directly connected for the first time. Sustainable electricity for nearly two million households can now be efficiently imported or exported. The undersea cable of more than 300 km also ensures greater security of supply for society. The German and Norwegian markets will be connected to each other directly for the first time with the NordLink cable connection that is currently being built. It is expected that this over 600 km long interconnector will be ready for operation in 2020 and facilitate the exchange of 'green' power on a large scale.

    TenneT's international solution to meet Europe's climate objectives after 2030 has provided new insights. An extensive study by the North Sea Wind Power Hub consortium has shown that an internationally coordinated roll-out of multiple 'Hub-and-Spoke' projects -  combining wind power connections, coupling energy markets through interconnection and smart integration in the onshore energy grid, including power to gas – is technically feasible. It will also increase societal welfare and support security of supply.  Each 'Hub-and-spoke' project of 10 – 15 GW and either platform of island based will be part of a step-by-step approach, providing adaptability to balance scale, development times and environmental compatibility.

    INNOVATION TO IMPROVE GRID UTILISATION

    Because the societal cost associated with the energy transition are rising and the incorporation of large infrastructure projects into the living environment often leads to discussions and litigation, TenneT is also explicitly looking for solutions that do not necessarily require costly grid expansions. The company initiates and participates in a large number of initiatives to make smarter use of existing assets and use new technologies.

    TenneT, for example, is carrying out pilots with a number of large automotive companies and suppliers of home batteries to enable 'crowd balancing'. TenneT strongly believes in a future in which electric cars and home appliances, such as home batteries, are used to unlock flexibility in power supply and demand and thus contribute to balancing the grid. With Daimler (Mercedes-Benz Energy) and BMW TenneT started successful pilots showing EV-batteries can indeed make a significant contribution to grid stabilization and system reconstruction. A role previously reserved only for conventional power plants.

    The innovative InnoSys project is aimed at designing digital solutions that will ensure the existing capacity of the high-voltage grid can be better used for the significantly growing need of sustainable electricity transport. Such an automated grid control system could prevent additional grid investments.Another longer-term innovation project includes the development - together with Thyssen Gas and Gasunie Germany - of a 100 MW electrolysis plant that can deliver green hydrogen for industry in phases as from 2022 and can serve as storage of sustainable energy in the form of gas.

    FINANCIAL

    TenneT's financial results were in line with expectations. 2019 underlying revenue of EUR 4,084 million decreased with 3% compared to 2018. Underlying EBIT decreased from EUR 853 million in 2018 to EUR 768 million in 2019. Excluding special items, underlying EBIT decreased by 9% to EUR 749 million in 2019, mainly driven by a reduced regulatory rate of return on equity in Germany, due to the start of the new 5-year regulatory period, partly offset by a higher regulatory asset base due to investments.

     

    Key underlying  financial figures (in millions of euros)20192018
    Revenue4,0844,176
    Earnings before interest and taxes (EBIT)768853
    EBIT, corrected for special items753826
    Investments in fixed assets3,0642,253

     

     

    Investments & financing: equity financing challenges ahead

    Otto Jager, TenneT's CFO: "As a result of the sustainable energy policy in the Netherlands and Germany, our investments are expected to increase further. In order to keep the company financially healthy, we expect to need EUR 2 to 3 billion of additional equity in the next four years. A number of solutions are conceivable. Any solution needs to be flexible, scalable and must not split the company. We are in close consultation with our shareholder (the Dutch State) about the best way forward. Earlier in the year under review, our shareholder announced that it would present its vision to parliament in 2020."

    Capex (investments) totalled EUR 3,064 million in 2019, of which EUR 1,131 million in the Netherlands and EUR 1,925 million in Germany. As a result of these investments, the net interest-bearing debt position increased by 9% to EUR 9,500 million at 31 December 2019.

    Leading in sustainable financing

    TenneT values its position as a leader in sustainable finance. In January of 2019 TenneT received EUR 500 million of proceeds from its first Green Private Placement in the U.S., which demonstrates TenneT's ability to further diversify its sources of funding and investors to finance its substantial investment plans.

    In May, TenneT issued a European green bond in two tranches, of 11 and 20 years, totaling EUR 1.25 billion. This bond will be used for investments in the transmission of renewable electricity from offshore wind farms to the onshore grid. Four Dutch offshore projects are also part of the green debt-financed portfolio, which up to now also includes nine offshore projects in Germany. In November TenneT Holding B.V. refinanced its EUR 2.2 billion sustainable Revolving Credit Facility (RCF) and increased the principal to EUR 3 billion. With more than EUR 11 billion of green debt and sustainable funding available, TenneT is the largest corporate issuer of green debt instruments in the Netherlands.

    Senior unsecured credit ratings as of 31 December 2019

     

    Long-term ratingShort-term rating
    Standard & Poor’sA- (stable outlook)A-2
    Moody’s Investor ServiceA3 (stable outlook)P-2

     

     

    INVESTMENT OUTLOOK

    The energy policies adopted by the Dutch and German governments are strongly focussed on making the energy system more sustainable. In order to be able to implement these policies on time, TenneT expects to increase its investment level to EUR 4 to 5 billion annually in the coming years as a result of the phase out of coal- and nuclear power plants and the strong growth of offshore wind energy. The increase in annual investments is due, for example, to the German decision to increase the capacity of offshore wind farms from 15 GW to 20 GW. The Dutch government has also initiated a major expansion of offshore wind energy in 2030, which means that TenneT must have realised 9.6 GW of connection capacity for offshore wind farms in the Dutch part of the North Sea by that year.
    Other large onshore projects in the Netherlands are ‘Zuidwest 380 kV’, ‘Noordwest 380 kV’ and the upgrade of the national 380 kV ring. In Germany the largest projects are the long-distance, underground direct current connections called SuedLink and SuedOstLink, connecting the northern part of the country with the south.

    2019 Integrated Annual Report and 2019 Green Finance Report

    For more information about TenneT, please consult the 2019 Integrated Annual Report, which is available on the website annualreport.tennet.eu/2019/annualreport. 

    TenneT has published the 2019 Green Finance Report in relation to the 'green' financing of TenneT's investment portfolio by issuing green bonds (since 2015).

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    news-1980 Thu, 07 Nov 2019 15:12:20 +0100 TenneT signs a EUR 3 billion sustainable RCF to further drive the energy transition https://www.tennet.eu/news/detail/tennet-signs-a-eur-3-billion-sustainable-rcf-to-further-drive-the-energy-transition/ The signed RCF by TenneT is the  largest sustainable RCF in the BeneluxTenneT has over EUR 11 billion of green debt and sustainable funding available Refinancing re-affirms TenneT’s commitment to social responsibility
  • The signed RCF by TenneT is the  largest sustainable RCF in the Benelux
  • TenneT has over EUR 11 billion of green debt and sustainable funding available
  • Refinancing re-affirms TenneT’s commitment to social responsibility
  • TenneT Holding B.V.(rated A3/A-) refinanced its EUR 2.2 billion Revolving Credit Facility (RCF) and increased the principal to EUR 3 billion. The pricing of the facility is linked to TenneT's ambition to be fully climate neutral in 2025.

    The maturity date of the RCF, which can be used for general corporate purposes, is extended to November 2024 with two one-year extension options. The agreed accordion options gives TenneT the flexibility to further increase the RCF. 

    Participating banks in the single tier RCF are: Rabobank (Sustainability) Coordinator,  ABN AMRO, BNP Paribas, BNG, Deutsche Bank, HSBC, ING Bank (Agent), Lloyds, NatWest and SMBC.

    Investing in the energy transition

    TenneT is driving the European energy transition and expects to invest EUR 35 billion in offshore and onshore grid connections across the Netherlands and Germany over the next ten years. Approx. 80 percent of TenneT's investments are directly related to the energy transition and renewable electricity production, such as wind and solar energy. In the period up to 2030, TenneT expects to have realized approximately 25 gigawatts (GW) of connection capacity for offshore wind farms in the Dutch and German parts of the North Sea, transmitting electricity sufficient to power 31 million households for a full year.

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    news-1920 Tue, 30 Jul 2019 08:00:00 +0200 TenneT on track driving energy transition https://www.tennet.eu/news/detail/tennet-on-track-driving-energy-transition/ Continued high grid reliability, coupled with progress on unlocking flexibility and initiatives to optimise the use of existing grid infrastructure. Underlying operating result (EBIT) increased from EUR 362 million (first half of 2018) to EUR 407 million in the first half of 2019.In the first half of 2019, EUR 1,094 million (first half of 2018: EUR 904 million) was invested in German and Dutch high-voltage grids.Thereof TenneT invested EUR 612 million in GermanySuccessful issuance of in total EUR 1,75 billion in green financing instruments.
  • Continued high grid reliability, coupled with progress on unlocking flexibility and initiatives to optimise the use of existing grid infrastructure.
  • Underlying operating result (EBIT) increased from EUR 362 million (first half of 2018) to EUR 407 million in the first half of 2019.
  • In the first half of 2019, EUR 1,094 million (first half of 2018: EUR 904 million) was invested in German and Dutch high-voltage grids.
  • Thereof TenneT invested EUR 612 million in Germany
  • Successful issuance of in total EUR 1,75 billion in green financing instruments.
  • TenneT is making progress in driving the European energy transition, as the Half Year Report of the German-Dutch grid operator shows. In the first half of 2019, TenneT has managed to maintain the high level of 99.99% security of supply, which is a growing challenge because of the increased feed-in of volatile renewable energy. To cope with this challenge in the future, TenneT has set up a number of strategic initiatives and partnerships to join forces across sectors. Following the Infrastructure Outlook 2050 published earlier this year, TenneT is taking next steps in planning of the energy system for 2030, in cooperation with Gasunie and the regional grid companies. The Power-to-Gas pilot project “ELEMENT EINS”, a joint initiative of Thyssengas, Gasunie and TenneT, has been selected by the federal government of Germany as one of 20 “real laboratories of the energy transition” to be funded by the government

    In Germany and the Netherlands, TenneT is working together with regional grid companies and market parties on smart solutions to optimise the use of existing electricity infrastructure. The InnoSys 2030 project in Germany aims to optimise the transport capacity of existing infrastructure by new IT solutions and automated operation. The GOPACS-project - Grid Operators Platform for Congestion Solutions - in the Netherlands provides new market-based possibilities to reduce congestion in the electricity grid. TenneT is also taking the next steps in the blockchain pilot project to unlock flexibility for balancing the electricity system from decentralised sources, such as home batteries and electric vehicles.

    TenneT also has continued to expand its positions as leading Offshore TSO. In Germany, TenneT has awarded the 14th Offshore grid connection DolWin 5. TenneT will increase its current offshore transmission capacity of 6,232 MW in the German part of the North Sea to almost 9 gigawatts by 2024.
    In the Netherlands, the development of the offshore grid with the Borssele Alpha and Beta projects is on schedule. TenneT will provide a total of 10.6 gigawatts1 (GW) of connection capacity for offshore wind farms in the Netherlands by 2030.

    1 GW existing wind parks, 3,5 GW following from the Energy Agreement for Sustainable Growth (2013) and 6,1 GW following from the Roadmap Wind at Sea 2024 – 2030 (2018).

    TenneT is carrying out a large number of onshore projects to guarantee the transport and thus the security of supply of a growing quantity of green electricity from new production locations on land and at sea, from the Netherlands, Germany and other European countries.

    In Germany, the proposed 700 km corridor for the direct current connection (DC) SuedLink was presented in February, together with project partner TransnetBW. SuedLink and SuedOstLink2 , which will also be laid underground and covers almost 600 kilometres, will be transporting large volumes of sustainable wind energy from the north to the south of Germany from around 2025.
    Also TenneT’s largest German AC project, the 230km line between Wahle (near Braunschweig) to Mecklar in Hesse, which also will transport green energy from the North to Southern Germany, is making significant progress, with building activities in 3 of 4 sections. The important reinforcement of the 380kV crossing of the Elbe between Hamburg (Nord) and Dollern in Lower Saxony is expected to get into operation by the end of the year.

    The German and Norwegian markets will be connected to each other directly for the first time with the NordLink cable connection that is currently being built. The commissioning of this 623-km-long interconnector is expected to start in 2020 (full completion in 2021).The subsea COBRA cable between the Netherlands and Denmark has 'landed' at the connection point in Eemshaven and will be put in operation later this year.

    Manon van Beek, CEO: "We have embarked on an irreversible transition to a sustainable society and a new energy system. This requires investments, not only in new electricity connections, but also in innovations and digitalisation. We have to move to holistic energy system thinking and also work on solutions to make better use of the existing high-voltage grids. We are convinced that this is the way forward to limit social costs and at the same time maintain a very high security of supply."

    2 SuedLink is being developed by TenneT and TransnetBW, SuedOstLink by TenneT and 50Hertz.

    Underlying operating results

    In the first half of 2019 TenneT's underlying revenue of EUR 2,166 million increased with 10.2% compared to 2018 (EUR 1,966 million), mainly due to additional revenue generated by a growing asset base and reimbursements for increased grid expenses.

    The increase of EBIT by 12.4% to EUR 407 million is partly due to a change in the regulatory treatment of costs related to operating the grid, such as grid losses and balancing expenses. Compared to 2018, the reimbursement of such costs has changed from a fixed budget to a pass-through methodology, as they are largely out of the company’s sphere of influence.  

    The implementation of the new lease standard (IFRS16) has led to an increase in depreciation and a reduction in operational costs. As a result, EBITDA increases, while the impact on EBIT is limited. As a result of the large number of projects - in development and execution - supporting the energy transition, investments increased by EUR 190 million (+21%) compared to the first half of last year.

    Key underlying results3

    Amounts in millions of euro30 June 201930 June 2018
    Revenue2,1661,966
    EBITDA877699
    EBIT407362
    Investments in tangible fixed assets1,094904
    Senior unsecured credit ratingsA-/A3A-/A3


    3 Contrary to the International Financial Reporting Standards (IFRS), the so-called ‘underlying’ figures reflect regulatory assets and liabilities in connection with TenneT’s regulated activities. This means that amounts resulting from past events and that are allowed or required to be settled in future grid tariffs are recognized as assets or liabilities.

    Green Financing

    In January, TenneT received EUR 500 million of proceeds from its first Green Private Placement in the U.S., which demonstrates TenneT's ability to further diversify its sources of funding and investors to finance its substantial investment plans.
    In May, TenneT issued a European green bond in two tranches, of 11 and 20 years, totalling EUR 1.25 billion. This bond will be used for investments in the transmission of renewable electricity from offshore wind farms to the onshore grid. Four Dutch offshore projects are also part of the green debt-financed portfolio, which up to now also includes nine offshore projects in Germany. With more than EUR 8 billion in sustainable financing issued, TenneT is the largest corporate issuer of green debt instruments in the Netherlands.

    Otto Jager, CFO: "We have an excellent track record in and access to the debt capital markets. This gives us ample room to finance our extensive investment programme in a very cost effective manner. However, to maintain our strong credit ratings, we expect the need to raise EUR 2 to 3 billion of equity capital within the next 5 years as well. We are in a constructive dialogue with our shareholder, the Dutch Ministry of Finance, to determine the best way forward on this matter.“

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    news-1886 Wed, 12 Jun 2019 14:50:54 +0200 XBID – 1st anniversary and announcement of 2nd Wave Go-Live https://www.tennet.eu/news/detail/xbid-1st-anniversary-and-announcement-of-2nd-wave-go-live/ XBID, the Single Intraday Coupling (SIDC) solution, is one year old today! Since the successful go-live on June 12th/13th, 2018 over 16 million trades have been executed. Expansion of the SIDC into 7 further countries is expected in Quarter 4, 2019. XBID, the Single Intraday Coupling (SIDC) solution, is one year old today! Since the successful go-live on June 12th/13th, 2018 over 16 million trades have been executed. Expansion of the SIDC into 7 further countries is expected in Quarter 4, 2019.

    The SIDC parties are pleased to recognise a successful first year of operation with high and growing numbers of trades together with stable and robust performance. Over 16 million trades have been successfully completed since go-live in June 2018.

    Preparation and testing are now well underway for a 2nd wave go-live which is expected to be launched towards the end of Quarter 4 2019. The following countries are actively involved in this expansion: Bulgaria, Croatia, Czech Republic, Hungary, Poland, Romania and Slovenia, together with the bordering countries who are already operational from the first go-live. These are Austria, Belgium, Denmark, Estonia, Finland, France, Germany, Latvia, Lithuania, the Netherlands, Norway, Portugal, Spain and Sweden.

    A 2nd Wave Pre-Launch Event is being planned for early October 2019 to brief stakeholders ahead of the Go-Live. A Trial Period with Market Parties is also being arranged to provide opportunities for new users to gain familiarity with the SIDC solution and undertake their own tests in preparation.

    The Co-Chairs of the SIDC Steering Committee, Jean Verseille, and Stefano Alaimo, stated: “We are very pleased to have reached this important milestone of one year of operations. The growth in trading demonstrates the important role of an integrated intraday market. We look forwards to the further expansion and development of SIDC. With seven countries due to go-live by the end of 2019 this would bring the geographic coverage of SIDC to an 21 countries. There are also discussions underway about a 3rd wave Go-Live.”

    SIDC is also being developed to deliver additional benefits and later in 2019 a second release of SIDC is due to be deployed. Importantly, for Market Parties, this will increase the order book depth to 100, a significant increase from the current depth of 31.

     

    Contact:

    50Hertz Transmission GmbH 
    Volker Kamm, T +49 30 5150 3417, M +49 172 3232759, E volker.kamm(at)50hertz.com 

    Amprion GmbH 
    Andreas Preuß, T +49 231 5849 13785, M +49 172 2407116, E andreas.preuss(at)amprion.net 

    TenneT TSO GmbH 
    Ulrike Hörchens, T +49 921 50740 4045, M +49 151 17131120, E ulrike.hoerchens(at)tennet.eu  

    TransnetBW GmbH
    Regina König, T +49 21858 3155, M +49 173 650 7067, E r.koenig(at)transnetbw.de 

     

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    news-1873 Mon, 20 May 2019 19:02:42 +0200 TenneT goes green again: issues EUR 1.25 billion of green financing https://www.tennet.eu/news/detail/tennet-goes-green-again-issues-eur-125-billion-of-green-financing/ Green bond investors put in orders of more than EUR 5 billionFinancing re-affirms TenneT’s commitment to social responsibilityLargest corporate green debt issuer in the Netherlands, with over EUR 8 billion issued
  • Green bond investors put in orders of more than EUR 5 billion
  • Financing re-affirms TenneT’s commitment to social responsibility
  • Largest corporate green debt issuer in the Netherlands, with over EUR 8 billion issued
  • TenneT Holding B.V. (rated A3/A-) today successfully launched and priced another Green Bond issue of EUR 1.25 billion, split in two tranches of EUR 500 million (term: 11 years, coupon 0.875%) and EUR 750 million (term: 20 years, coupon: 1.500%) with the support of five banks: ABN AMRO, Barclays, HSBC, NatWest Markets and SMBC Nikko. Proceeds will be used to invest in green projects in the Netherlands and Germany to connect large scale of offshore wind to the onshore electricity grid.

    Investing in green energy

    Over the next ten years TenneT expects to invest EUR 35 billion in offshore and onshore grid connections across the Netherlands and Germany, driving the energy transition. Approx. 80 percent of TenneT's investments are related to renewables, such as wind and solar energy. In the period up to 2030, TenneT expects to have realized approximately 25 gigawatts (GW) of connection capacity for offshore wind farms in the Dutch and German parts of the North Sea, transmitting electricity sufficient to (every year) power 31 million households for a full year.

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    news-1786 Wed, 09 Jan 2019 11:29:41 +0100 Announcement publication integrated annual report and annual results for 2018 https://www.tennet.eu/news/detail/announcement-publication-integrated-annual-report-and-annual-results-for-2018/ On Thursday, February 21rd, 2019, TenneT Holding BV will publish its integrated annual report and annual results for the year 2018. 

    On Thursday, February 21rd, 2019, TenneT Holding BV will publish its integrated annual report and annual results for the year 2018. 

    On the same day (in the morning), a press conference is planned at the HSM yard in Schiedam, where TenneT is building projects for offshore wind energy.

    For more information / details or to register journalists can contact TenneT Media Relations: +31 26 373 2600 (tel.) or press@tennet.eu (e-mail). 

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    news-1570 Tue, 14 Aug 2018 08:31:01 +0200 EIB reaffirms support for Nordlink interconnector with EFSI-backing https://www.tennet.eu/news/detail/eib-reaffirms-support-for-nordlink-interconnector-with-efsi-backing/ European Investment Bank (EIB) closes a EUR 100m single investor tap of TenneT's 2017 hybrid bond to support the construction of NordLink interconnector between Norway and GermanyTransaction backed under European Fund for Strategic Investments (EFSI), part of successful Juncker Plan. This marks EIB’s first participation in a market hybrid bond issuance
  • European Investment Bank (EIB) closes a EUR 100m single investor tap of TenneT's 2017 hybrid bond to support the construction of NordLink interconnector between Norway and Germany
  • Transaction backed under European Fund for Strategic Investments (EFSI), part of successful Juncker Plan. This marks EIB’s first participation in a market hybrid bond issuance
  • TenneT Holding B.V. and the EIB today closed the issuance of EUR 100 million hybrid capital by TenneT (rated A3/A-). EIB has purchased EUR 100 million hybrid securities to be consolidated and form a single series with TenneT’s hybrid Securities programme launched on 12 April 2017. 

    The European Investment Bank has herewith reaffirmed its support for the Nordlink interconnector between Germany and Norway. After the signature in 2017 of loans to TenneT and Statnett, the EIB has now subscribed to a hybrid bond issue by TenneT to further support the project. The financing was made possible by the European Fund for Strategic Investments (EFSI), central pillar of the successful Investment Plan for Europe, which was launched by the EIB Group and the European Commission to boost the competitiveness of the European economy. 

    The EIB Vice-President Ambroise Fayolle commented: “This interconnector is a major project in a world where renewable energy is of such importance. This last step completes the EIB support for this project, which is exactly the type of project the EIB was set up to do sixty years ago. The security of supply and effective use of renewable energy remain high on the agenda for EIB financing and we are glad that this aligns completely with the objectives of the EFSI. We are excited that we are able to support this project while participating in TenneT’s hybrid bond tap, alongside other investors”

    Otto Jager, TenneT’s Chief Financial Officer, added: “Today’s transaction underlines the further deepening of our strong relationship with the EIB. In addition to the senior commitments of EUR 1.5bn, the EIB today supports one of the most challenging projects for the establishment of an interconnected renewable energy market in Europe. We are proud that we are the first issuer of a market hybrid bond with the EIB as participant and we are looking forward to further extend our relationship with the EIB in the near future.”

    European Commission Vice-President for the Energy Union Maroš Šefčovič said: "We need forward-looking investments into modern energy infrastructure with adequate interconnections, in particular to integrate renewables into the grid. It is a vital element of our energy security as well as our climate action. This smart combination of renewable power generation – solar and wind in Germany and hydroelectric in Norway – underlines our firm commitment to bring clean power to millions of people." 

    The NordLink interconnector is being developed by the Norwegian TSO Statnett and DC Nordseekabel, each with 50% ownership. DC Nordseekabel is equally owned by TenneT and the German promotional bank KfW, and is responsible for the construction of the German part of the project. Once completed, a bipolar high voltage direct current (HVDC) link will connect Norway and Germany across the North Sea with a rated capacity of 1400 MW and a total length of 624 km. NordLink will improve diversification and security of supply, enhancing electricity market integration in both countries, and more widely between Northwest Europe and Scandinavian countries. It is also designated as a Project of Common Interest in the Priority Corridor Northern Seas Offshore Grid. 

    Background Information

    The European Investment Bank (EIB) is the European Union’s long-term financing institution lending for investments that contribute to achieving the EU’s objectives. Founded in 1958, it operates in the 28 EU Member States, the EU’s neighbour countries and more than 100 other countries around the globe. Since 1994 the Bank can lend to eligible projects in Iceland under the EFTA Facility. This mandate enables the Bank to support projects notably in the sectors of energy, environment, research, development and innovation located in the territories of the EFTA countries (Iceland, Liechtenstein, Norway and Switzerland).

    The NordLink interconnector is being developed by the Norwegian TSO Statnett and DC Nordseekabel, each with 50% ownership. DC Nordseekabel is equally owned by TenneT and the German promotional bank KfW, and is responsible for the construction of the German part of the project. The NordLink interconnector will be the first high voltage cable directly connecting German and Norwegian electricity markets. NordLink is designed to have a capacity of 1,400 MW and a total length of approx. 624 kilometers. 

    About The Investment Plan for Europe

    The Investment Plan for Europe focuses on strengthening European investments to create jobs and growth. It does so by making smarter use of new and existing financial resources, removing obstacles to investment, and providing visibility and technical assistance to investment projects. The European Fund for Strategic Investments (EFSI) is the central pillar of the Juncker Plan. It provides a first loss guarantee, allowing the EIB to invest in more, often riskier, projects. So far, the projects and agreements approved for financing under the EFSI are expected to mobilise EUR 335 billion in investments and support around 700 000 SMEs across all 28 Member States. Find the latest EFSI figures by sector and by country here, or see the FAQs.

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    news-1336 Wed, 23 May 2018 08:06:11 +0200 TenneT issues EUR 1.25 billion of Green Bonds https://www.tennet.eu/news/detail/tennet-issues-eur-125-billion-of-green-bonds/ Market provides TenneT again with long-dated bonds supported by a sizeable order book of around EUR 2.5 billionTenneT has for the first time added two Dutch offshore projects (Borssele Alpha and Borssele Beta) to its Green Bond portfolio including so far nine offshore projects in Germany TenneT is the largest (corporate) issuer in the Netherlands of green debt with a total of  EUR 6.25 billion of green issuances 
    • Market provides TenneT again with long-dated bonds supported by a sizeable order book of around EUR 2.5 billion
    • TenneT has for the first time added two Dutch offshore projects (Borssele Alpha and Borssele Beta) to its Green Bond portfolio including so far nine offshore projects in Germany
    • TenneT is the largest (corporate) issuer in the Netherlands of green debt with a total of  EUR 6.25 billion of green issuances 

    TenneT Holding B.V. (rated A3/A-) successfully launched and priced another Green Bond issue under its green bond program of EUR 1.25 billion, split in two tranches of EUR 500 million (term: 10 years, coupon 1.375%) and EUR 750 million (term: 16 years, coupon 2.00%) with the support of five banks: BNP Paribas, Deutsche Bank, ING Bank, Lloyds and Rabobank.

    Investing in green energy

    TenneT’s investments in offshore and onshore grid connections across the Netherlands and Germany are expected to total EUR 28 billion over the next 10 years.

    In the period up to 2019, TenneT is realizing over 7,000 megawatts (MW) of connection capacity for offshore wind farms in the German sector of the North Sea, transmitting electricity equivalent to the annual power consumption of approx. 10 million households. By 2023, TenneT expects to have realized 3,500 MW of connection capacity in the Dutch sector of the North Sea, corresponding to the annual power consumption of close to 5 million households.

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    news-1098 Fri, 23 Feb 2018 08:00:00 +0100 TenneT focuses on increasing resilience of the electricity grid while maintaining high security of supply https://www.tennet.eu/news/detail/tennet-focuses-on-increasing-resilience-of-the-electricity-grid-while-maintaining-high-security-of-s/ TenneT invested EUR 1,770 million in 2017 in order to facilitate the energy transition while maintaining a high level of security of supply in the high-voltage grids (99.99% in 2017).Underlying revenue totalled EUR 3,948 million in 2017, with EBIT amounting to EUR 742 million (excluding special items). Energy transition requires a data-based, more flexible electricity grid combined with investments in grid expansions.TenneT is preparing the electricity system for the participation of millions of electricity consumers using new software in pilot projects testing blockchain technology.
    • TenneT invested EUR 1,770 million in 2017 in order to facilitate the energy transition while maintaining a high level of security of supply in the high-voltage grids (99.99% in 2017).
    • Underlying revenue totalled EUR 3,948 million in 2017, with EBIT amounting to EUR 742 million (excluding special items).
    • Energy transition requires a data-based, more flexible electricity grid combined with investments in grid expansions.
    • TenneT is preparing the electricity system for the participation of millions of electricity consumers using new software in pilot projects testing blockchain technology.

    Dutch-German Transmission System Operator (TSO) TenneT is again presenting healthy financial results in the Integrated Annual Report 2017 and Financial Statements 2017 published today. The annual report further shows TenneT is working on an upgraded and robust electricity grid by combining new onshore and offshore infrastructure with the introduction of a more flexible electricity system and intelligent software based on blockchain technology.

    TenneT CEO Mel Kroon commented: “In 2017 we made good progress on realizing our strategic priorities. Of essential importance is the fact that we have once again succeeded in safeguarding the high availability of our grids. And at the same time we're preparing our grids for a (near) future based on a fully sustainable energy landscape. Now modern society is increasingly dependent on electricity, the costs of renewable electricity decrease significantly and ‘green power’ is supplied by a wide range of sources at countless locations, we must shift to a new electricity system that can support this revolution. This means that we need to develop a more flexible system with sufficient capacity for the storage of electricity in hydrogen form and in batteries. The participation of millions of ‘prosumers’ in the electricity market is also of great importance because  much less conventional and easily controllable capacity for electricity generation will be available in the future to maintain the supply-demand balance in the power grid. The balancing role of conventional power plants will be partially taken over by consumers with electric vehicles, solar panels or home batteries. Collectively, they can provide the required flexibility while also making money in the process.”

    In 2017, TenneT therefore set up two pilot projects in the Netherlands and Germany to enable electricity consumers to take part in the electricity market. By collaborating with a so-called ‘aggregator’ (in this case Vandebron in the Netherlands and Sonnen in Germany) and applying blockchain technology, the capacity of all the pooled batteries can be utilized, enabling consumers to directly conduct transactions and in this way contribute to the energy transition, and – crucially – to maintaining the balance between supply and demand on the high-voltage grid. Assuming these pilot projects turn out to be successful, TenneT intends also to collaborate with other interested parties to create the electricity system of the (near) future.

    Financial results and investments

    Key underlying  financial figures (in millions of euros)20172016
    Revenue3,9483,227
    Earnings Before Interest and Taxes (EBIT)897834
    EBIT, corrected for special items742701
    Investments in tangible fixed assets1,7701,848
    Total Assets20,41218,974

     

    TenneT CFO Otto Jager commented: “Our strong results enable us to continue to finance the necessary investments in the energy transition. The capital markets recognize us as a stable and reliable issuer of bonds, allowing us excellent access to a broad range of financing sources.”

    Underlying revenue and EBIT

    TenneT’s 2017 underlying revenue of EUR 3,948 million increased substantially from EUR 3,227 million in 2016, mainly due to increased reimbursements for expenses to balance demand and supply and additional revenue generated by the company’s growing asset base. Underlying EBIT increased from EUR 834 million in 2016 to EUR 897 million in 2017. Excluding special items (such as certain non-recurring reimbursements of offshore activities and releases of certain provisions), underlying EBIT grew as well, from EUR 701 million in 2016 to EUR 742 million in 2017. EBIT growth was mainly driven by the increase in our asset base.

    Investments and financing

    Capital Expenditure (CAPEX) totalled EUR 1,770 million in 2017, of which EUR 736 million was invested in the Netherlands and EUR 1,032 million in Germany. To meet the financing requirements resulting from its large investment portfolio, TenneT successfully completed the first-ever issue of green hybrid securities in April 2017 in a total amount of EUR 1 billion, classified as equity. In addition, TenneT issued EUR 1 billion in green bonds during 2017.

    Senior unsecured credit ratings as of 31 December 2017

    Long-term ratingShort-term rating
    Standard & Poor’sA- (stable outlook)A-2
    Moody’s Investors ServiceA3 (stable outlook)P-2

     

    New offshore grid connections for wind farms

    The development of an offshore system to connect wind farms off the Dutch coast to the onshore grid is proceeding according to plan. This concerns the Borssele, Holland Coast South and Holland Coast North wind farm zones, which together account for a total capacity of 3,500 megawatts (MW).

    For the medium term, TenneT sees opportunities for further expansion of wind energy capacity in the Dutch sector of the North Sea. A capacity increase of approx. 7,000 MW is possible during the 2023-2030 period, divided across different zones off the west coast of the Netherlands and north of the Wadden Sea Islands. The roadmap for offshore wind energy currently being prepared by the Dutch government will provide definitive answers in this respect. TenneT is consulting closely with the Ministry of Economic Affairs and Climate Policy about these developments.

    An artificial island to be constructed in the North Sea between the Netherlands and the UK is a possible solution if direct-current (DC) connections are used instead of alternating-current (AC) connections, as has been done so far. This solution would make it possible to accommodate the scale of future offshore wind farms and their greater distance from the coast. If the transport cables are then also used to trade electricity between the Dutch and UK markets, the utilization rate of the infrastructure will increase substantially from 45 to 80 percent.

    Ten TenneT offshore grid connections are currently operational in the German sector of the North Sea: three AC and seven DC connections. This brings the total capacity currently available for the transmission of offshore wind power to more than 5 gigawatts (GW). That is more than enough to transmit the current total installed capacity of offshore wind farms. TenneT has already achieved over 80 percent of the German federal government’s 2020 expansion target for offshore capacity. TenneT expects to complete two new offshore grid connections in 2019, bringing the total operational offshore connection capacity to over 7 GW. The total capacity is expected to increase to over 10 GW by 2025.

    In 2017, TenneT transported a record quantity of wind energy generated in the German sector of the North Sea, namely 16 terawatt-hours (TWh). This would be enough to supply green electricity to German railway operator Deutsche Bahn for over 18 months. The 2017 figures represent an increase of almost 50% compared to 2016 (11 TWh), and an increase of more than 100% compared to 2015 (7 TWh).

    In 2016 TenneT announced its long-term vision (2030-2050 period) for an ‘energy island’ far offshore in the North Sea, which would allow wind farms with a combined capacity of up to 100 GW to be connected to the German, Dutch, UK, Belgian, Norwegian and Danish electricity markets. The consortium that is exploring the possibilities for the construction of this so-called ‘North Sea Wind Power Hub’ was expanded in 2017 to include Gasunie and the Port of Rotterdam Authority, alongside the original partners (TenneT Netherlands, TenneT Germany and the Danish TSO Energinet.dk).

    Connecting electricity markets

    In the coming years, TenneT will significantly expand the cross-border electricity connections (interconnectors) between the Netherlands, Germany and other countries, adding flexibility to the electricity system. This will also have positive effects on price harmonization, the exchange of renewable electricity, and the security of supply in the countries involved. The construction of two new offshore interconnectors is already well underway: the NordLink subsea high-voltage cable between Germany and Norway, and the COBRAcable between the Netherlands and Denmark. The COBRAcable is scheduled for completion in 2019, and the NordLink project is expected to be ready in 2020.

    The Dutch section of the new interconnector between Doetinchem (Netherlands) and Wesel (Germany) will be completed in 2018. The German section is being realized by grid operator Amprion, and is taking longer to construct than initially expected. The capacity of the existing interconnector between Meeden (Netherlands) and Diele (Germany) will be increased in 2019, while the existing bi-directional Dutch-Belgian transmission capacity is to be increased gradually until it has more than doubled by 2022.

    Outlook

    The German government has pledged to move to a decarbonized economy by the middle of the century, and has set a target of at least 80% renewables for gross power consumption by 2050. There are similar developments in the Netherlands, as the government is committed to the accelerated decommissioning of existing coal-fired power plants by 2030 at the latest.

    All this means that TenneT’s work to develop a grid that can accommodate even larger quantities of renewable energy is more important than ever. Growing its business to keep pace with these developments will require an expected investment of approximately EUR 28 billion over the coming ten years.

    The planned investments in the Netherlands are related to grid expansions and an extensive maintenance and replacement programme for the existing grid infrastructure, among other projects. The main projects are the offshore grid (3,500 MW), Randstad 380 kV North Ring, South-West 380 kV, North-West 380 kV, the upgrade of the national 380 kV ring, the Doetinchem-Wesel interconnector, and the COBRAcable. In anticipation of political decision-making, the further development of the offshore grid in the Netherlands after 2023 has not been included in the overall investment plan.

    At hundreds of kilometres in length, the DC connections SuedLink and SuedOstLink are the most high-profile onshore projects in Germany, because of their impact on the human environment and the high costs for society. The German government has introduced legislation to ensure that these connections are (largely) installed underground (i.e. as cables). In addition to the planned DC connections, over 20 major projects are currently in the planning or execution phase.

    Integrated Annual Report 2017 and Green Finance Report 2017

    More information about TenneT may be found in our Integrated Annual Report 2017

    TenneT has also prepared a Green Finance Report 2017 in connection with the issue of so-called ‘green bonds’ (starting in 2015) to finance the company’s investment portfolio. 

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    news-1043 Mon, 11 Dec 2017 07:00:00 +0100 Industrial issuers of €26 billion in green bonds pledge to double down on green financing https://www.tennet.eu/news/detail/industrial-issuers-of-EUR26-billion-in-green-bonds-pledge-to-double-down-on-green-financing/ On the occasion of the Paris 2017 Climate Finance Day, nine of Europe’s largest industrial emitters of green bonds (EDF, Enel, ENGIE, Iberdrola, Icade, Paprec, SNCF Réseau, SSE and TenneT) publicly announce their pledge to further develop one of the most dynamic segments of sustainable finance today, the green bond market.  On the occasion of the Paris 2017 Climate Finance Day, nine of Europe’s largest industrial emitters of green bonds (EDF, Enel, ENGIE, Iberdrola, Icade, Paprec, SNCF Réseau, SSE and TenneT) publicly announce their pledge to further develop one of the most dynamic segments of sustainable finance today, the green bond market. 

    These companies have joined forces to voice their commitment to the green bond market as part of their strategy, financing policy and their active engagement in the reporting debate and dialogue with investors. The pledge also calls upon other industrial corporates to consider issuing green bonds.

    The signatories of today’s pledge commit to a long-term presence in the market, that green bonds will be at the heart of their (project) financing and business lines, and that they will implement stringent reporting procedures.

    This announcement, on the morning of Climate Finance Day and the day before the One Planet Summit in Paris, is a clear signal that green bonds are and will continue to play a significant role in finance and reaching the goals set at the Paris Agreement two years ago.

    Ten years after the first green bond issuance, this market, has turned into an exciting place in particular, thanks to companies committed to tackling climate change, to a growing awareness to environmental protection, low-carbon transport and buildings as well as energy efficiency. So far, all nine companies have issued a total of €26 billion in green bonds which accounts for over 10% of total outstanding green bonds.

    Together the signatories draw on their experience to call upon other industrial companies to consider issuing green bonds, which will further strengthen this market and enhance its interest from the growing share of climate-minded investors. 

    Xavier Girre, Group Senior Executive Vice President, Group Finance, at EDF said: “Since EDF’s first issuance in 2013, Green Bonds have become central in financing the Group’s strong ambitions in renewables. Through this pledge, EDF reiterates its commitment as a frequent issuer aiming for the highest standards and an active corporate contributor to shaping sustainable finance solutions.”

    Alberto De Paoli, Chief Financial Officer at Enel said: “Enel’s position as one of the leaders of the energy transition is based in large part on the way in which sustainability and innovation form the basis of all aspects of the Group’s industrial plan, including its financial strategy. Green bonds are a powerful instrument for promoting and supporting the transition towards a low carbon economy, and Enel will continue to play a prominent role in their ongoing growth and development in the global capital markets.”

    Judith Hartmann, Chief Financial Officer & Executive Vice President of ENGIE said:  “With €5.25bn of green bonds issued since 2014, ENGIE confirms its commitment to lead the energy transition and to drive actively the development of sustainable finance. By matching the company´s long-term view and investors´ sustainability goals, ENGIE considers green bonds as a critical lever to shape tomorrow´s low carbon and socially responsible energy world.”

    José Sainz Armada, Chief Financial Officer of Iberdrola, said: “Ever since incorporating Sustainable Development Goals to the company’s strategy, Iberdrola has become the largest European issuer of green bonds, the perfect source of long-term finance for projects making an environmental difference. Through independent certification, private investors guided by ethical principles ensure their funds are managed with a sustainable perspective and the strictest social criteria.”

    Victoire Aubry, Chief Financial Officer of Icade, declared: “As a player involved in environmental transition, Icade aims to be at the forefront of sustainable real estate. In this context, beginning of September, Icade  has  issued successfully, its  first  green  bond  for  a  total  of  € 600 million. This green  bond  is  fully  in  line  with  the proactive CSR policy pursued at all levels of the organisation. It will support Icade’s ambition to be a leading player in CSR among Real Estate Investment companies”

    Charles-Antoine Blanc, Chief Financial Officer of Paprec Group declared: “As a company fully dedicated to environmental services and more specifically waste recycling, we have started to issue green bonds by 2015 for an aggregate amount of 705 million euros. Those green bonds have allowed us to develop the company significantly since then with respect to our CSR policy but also Green Bond Principles.”

    Hugues de Nicolay, Deputy CEO – Finance & Purchasing - SNCF Réseau said: “In order to reach the objectives set by the Paris Climate Agreement and to foster a transition towards low carbon transportation, SNCF Réseau has decided to place Green Bonds at the heart of its financing strategy. Our objective is to become a leading player on this market not only in terms of volume - in less than 12 months, we launched three Green Bonds for a total amount of 2.65 billion euros - but also in terms of high-level standards.”

    Gregor Alexander, Finance Director of SSE, said: “We are pleased our issuance earlier this year shows our commitment to SSE’s sustainability and responsibility principles. It sends out a clear and unequivocal message to stakeholders, that SSE supports the transition to a low carbon energy system and wants to see a sustainable economy in the UK and Ireland in the long term.”

    Otto Jager, Chief Financial Officer of TenneT: "Issuing green bonds related to certain activities or projects is a first important step by an enterprise in taking responsibility for its social and environmental impact. I expect that in the future the ESG record of a company as a whole will become just as an important factor for investors as its financial performance."

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    news-955 Fri, 28 Jul 2017 08:00:00 +0200 TenneT gives strong impulse to European collaboration and digitalisation of the electricity system to facilitate energy transition https://www.tennet.eu/news/detail/tennet-gives-strong-impulse-to-european-collaboration-and-digitalisation-of-the-electricity-system-t/ Steady steps taken towards international collaboration to unlock large scale offshore wind energyInnovative projects based on block chain technology to prepare system for strong growth in renewable electricity feed-inEUR 750 million invested in Dutch and German high-voltage grids in first half of 2017Underlying operating result (EBIT) rises from  EUR 414 million to EUR 478 millionEUR 2 billion issued in ‘green’ (hybrid) bonds
    • Steady steps taken towards international collaboration to unlock large scale offshore wind energy
    • Innovative projects based on block chain technology to prepare system for strong growth in renewable electricity feed-in
    • EUR 750 million invested in Dutch and German high-voltage grids in first half of 2017
    • Underlying operating result (EBIT) rises from  EUR 414 million to EUR 478 million
    • EUR 2 billion issued in ‘green’ (hybrid) bonds

    In the first half year of 2017, TenneT has pressed on with its efforts to promote European energy collaboration. The TSO has entered into a partnership with its Danish counterpart Energinet for the long-term development of a North Sea Wind Power Hub that will help ensure the affordable, large-scale supply of offshore wind energy. In Germany and the Netherlands, TenneT is working together with IBM and start-ups sonnen and Vandebron using block chain technology to facilitate local, flexible electricity generation.

    TenneT CEO Mel Kroon commented: “There are two key enablers of the transition to a more sustainable electricity supply system. Firstly, we need further integration of the North-West European electricity markets and therefore closer collaboration, so we can better cope with larger amounts of weather-dependent wind and solar energy. Secondly, we must develop smart, innovative systems that efficiently match the demand for electricity with the fluctuating supply from these  ‘green’ energy sources. This can be accomplished using smart software solutions.

    European perspective

    Further North-West European market integration is needed to achieve the long-term sustainability targets that have been defined. A consortium consisting of TenneT Netherlands, TenneT Germany, Energinet.dk, with  additional partners to be expected, has been set up for this purpose. 

    In June 2017, TenneT also opened an office in Brussels to ensure a permanent presence in the administrative heart of Europe. Furthermore, TenneT’s Chief Operating Officer Ben Voorhorst has been appointed as President of ENTSO-E (European Network of Transmission System Operators for Electricity) with effect from 1 July 2017.

    Underlying operating results (HY 2017)

    Underlying revenue grew up to EUR 1,966 million in the first half of 2017, mainly driven by the reimbursement of payments made to electricity generators for shifting electricity production to avoid overloads on the grid or to keep supply of and demand for electricity in balance. As these so called system service expenses are compensated on a pass-through basis, this does not affect underlying operating profit (EBIT). Underlying EBIT grew from EUR 414 million to EUR 478 million, in line with the growth in the company's asset base in the Netherlands and Germany.

    Investments in further strengthening the electricity infrastructure in the Netherlands and Germany in the first half of 2017 remained at high level. Investments in tangible fixed assets amounted to EUR 750 million during this period.

    Key underlying results 

    EUR Million30 June 201730 June 2016
    Revenue 1,9661,546
    EBITDA796715
    EBIT478414
    Investments tangible fixed assets  750875
    EUR Million30 June 201730 June 2016
    Net interest-bearing debt, adjusted7,4377,347
    Equity5,2774,792
    Total assets 20,25118,974


    Financing

    The issuance of TenneT's ‘green’ hybrid bonds (EUR 1 billion) in March 2017 was followed by another senior green bond issue of EUR 1 billion in June. Both bond issues will be used to finance investments in the transmission of renewable electricity from offshore wind farms to the onshore electricity grid. The Green Financing page on TenneT’s website provides an overview of the eight offshore projects to be financed through the issuance of ‘green’ debt instruments.

    TenneT’s expanding green bonds and loans programme is entirely in line with its extensive investment portfolio.  Otto Jager (CFO TenneT): "Being the first ever corporate issuer of hybrid equity underlines our ongoing commitment to further develop a green financing market. We view this as an integral part of our social responsibility."

     

    TenneT’s credit ratings as at 30 June 2017 have remained unchanged compared to 2016:

    Long-term ratingShort-term rating
    Standard & Poor’sA- (stable outlook)A-2
    Moody’sA3 (stable outlook)P-2

     

    Major grid expansion projects in the Netherlands and Germany

    TenneT is currently completing the construction phase of the Dutch section of the fourth cross-border electricity connection between the Netherlands and Germany – from the Dutch town of Doetinchem to Wesel across the border. Construction work on the ring connection in the northern part of the so called Randstad area (Randstad 380 kV Noord Ring) is proceeding according to plan. Work has also begun on two other major onshore projects in the Netherlands: South-West 380 kV – West & Rilland and North-West 380 kV.

    TenneT’s onshore projects in Germany are both large scale and challenging due to the long distances and large number of stakeholders involved, the permit procedures and the technical and legal complexities. Nevertheless, a large number of new electricity connections have reached the construction phase. These include the newly built  connections between Northern Germany and Denmark and the so called Westküstenleitung. The long-distance underground direct-current connections SuedLink and SuedOstLink are in the process of approval.

    Two offshore projects are currently under development in the Netherlands: Borssele Alpha and Borssele Beta. Both 700 MW offshore grid connections (consisting of offshore transformer substations and subsea cables) are expected to be completed in 2019. They are the first of a total of five grid connections to be constructed in the Dutch sector of the North Sea for future wind turbine farms. The total connection capacity to be realized by 2023 amounts to 3,500 MW. The new 700 MW COBRA cable between the Netherlands and Denmark is expected to become available to the market in 2019.

    The German offshore grid connections DolWin3 (capacity: 900 MW) and BorWin3 (capacity: 900 MW) are currently under construction. By 2019, TenneT is planning to have realised 7,132 MW of connection capacity for offshore wind farms in Germany.

    Construction work on the NordLink project – a direct cable (1,400 MW) between the hydro powered Norwegian market and the German wind and solar based electricity market  – is well underway. This subsea cable is scheduled to be operational by 2020.

    Learn more about TenneT? Click here.

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    news-930 Mon, 12 Jun 2017 18:03:45 +0200 TenneT issues another EUR 1 billion of Green Bonds https://www.tennet.eu/news/detail/tennet-issues-another-eur-1-billion-of-green-bonds/ TenneT is the largest (corporate) issuer in the Netherlands of green debtThis green bond follows the first ever green hybrid of EUR 1bn issued earlier in 2017 and totals all green issuances to EUR 5 billion 
    • TenneT is the largest (corporate) issuer in the Netherlands of green debt
    • This green bond follows the first ever green hybrid of EUR 1bn issued earlier in 2017 and totals all green issuances to EUR 5 billion 

    TenneT Holding B.V. (rated A3/A-) today successfully launched and priced another Green Bond issue under its green bond program of EUR 1 billion, a dual tranche of each EUR 500 million with a maturity of 8 year (coupon of 0.75%) and 12 year (coupon of 1.375%) with the support of five banks: ABN AMRO, HSBC, NatWest Markets, Rabobank and SMBC Nikko.

    Investing in green energy

    Today’s announcement relates to the issuance of Green Bonds for investments in the transmission of renewable electricity from offshore wind farms to the onshore electricity grid. The eight offshore projects financed with the proceeds can be viewed through green financing.

    TenneT’s investments in offshore wind energy projects across the Netherlands and Germany are expected to total EUR 9 to 11 billion over the next 10 years. In the period up to 2019, TenneT is realizing over 7 gigawatts (GW) of connection capacity for offshore wind farms in the German sector of the North Sea, transmitting electricity equivalent to the annual power consumption of approx. 10 million households. By 2023, TenneT expects to have realized 3.5 GW of connection capacity in the Dutch sector of the North Sea, corresponding to the annual power consumption of close to 5 million households.

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    news-921 Tue, 23 May 2017 15:03:44 +0200 Announcement publication Half Year Results and Half Year Report 2017 https://www.tennet.eu/news/detail/announcement-publication-half-year-results-and-half-year-report-2017/ On friday, July 28th 2017, TenneT Holding BV will publish its half year report 2017 and financial results for the first half year of 2017. On friday, July 28th 2017, TenneT Holding BV will publish its half year report 2017 and financial results for the first half year of 2017.

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    news-889 Thu, 13 Apr 2017 12:19:54 +0200 Notice of Redemption in relation to EUR 500 million outstanding Perpetual Capital Securities https://www.tennet.eu/news/detail/notice-of-redemption-in-relation-to-eur-500-million-outstanding-perpetual-capital-securities/ On 13 April 2017, TenneT Holding B.V. as Issuer, has noticed the Securityholders  of TenneT's €500,000,000 Fixed-to-Floating Rate Perpetual Capital Securities issued on 9 February 2010  that TenneT has elected to call and redeem, and will redeem, pursuant to the Issuer's call option all of its outstanding Securities on 1 June 2017. On 13 April 2017, TenneT Holding B.V. as Issuer, has noticed the Securityholders  of TenneT's €500,000,000 Fixed-to-Floating Rate Perpetual Capital Securities issued on 9 February 2010  that TenneT has elected to call and redeem, and will redeem, pursuant to the Issuer's call option all of its outstanding Securities on 1 June 2017.

    The Securities will be redeemed at their principle amount together with any interest accrued thereon, including any Arrears of Interest, up to (but excluding) the Redemption Date. The full text of the Notice of Redemption is available at: www.tennet.eu/nl/bedrijf/investor-relations/hybrid/  

    Definitions

    Unless the context otherwise requires, capitalised terms used but not defined herein have the same meaning as assigned thereto in the Terms & Conditions of the Capital Securities (the "Conditions") set forth in the prospectus dated 4 February 2010 for the Capital Securities.

    TenneT Holding B.V. 
    Attention: Jeroen Dicker, Group Treasurer
    P.O. Box 718
    6800 AS Arnhem
    The Netherlands

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    news-867 Wed, 29 Mar 2017 16:15:00 +0200 TenneT issues first-ever Green Hybrid Bond https://www.tennet.eu/news/detail/tennet-issues-first-ever-green-hybrid-bond/ EUR 1 billion of proceeds to finance high-voltage grid connections to offshore wind farmsMarket shows keen interest with an order book of approx. EUR 3 billion 
    • EUR 1 billion of proceeds to finance high-voltage grid connections to offshore wind farms
    • Market shows keen interest with an order book of approx. EUR 3 billion 

    TenneT Holding B.V. (rated A3/A-) today successfully launched and priced the first-ever green hybrid bond, in an amount of EUR 1 billion with a coupon of 2.995% and a non-call period of 7 years with the support of five banks: Barclays and  Deutsche Bank as (joint structuring advisors and joint bookrunners) and BNP Paribas, HSBC Bank and ING Bank as (joint bookrunners). The hybrid bond has received an instrument rating of Baa3 and BB+ by Moody's and S&P respectively.

    Otto Jager, TenneT’s Chief Financial Officer, said: “Today’s inaugural Green Hybrid Bond issue demonstrates our ongoing commitment to green financing instruments and the further development of the green financing market. It provides an excellent way to finance our green investment portfolio, which facilitates the transition to renewable energy, while supporting our credit ratings at the same time."

    Investing in green energy

    TenneT’s investments in offshore wind energy projects across the Netherlands and Germany are expected to total EUR 9 to 11 billion over the next 10 years. In the period up to 2019, TenneT is realizing over 7,000 megawatts (MW) of connection capacity for offshore wind farms in the German sector of the North Sea, transmitting electricity equivalent to the annual power consumption of approx. 7 million households. By 2023,  TenneT expects to have realized 3,500 MW of connection capacity in the Dutch sector of the North Sea, corresponding to the annual power consumption of close to 3.5 million households. 

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    news-847 Wed, 08 Mar 2017 08:00:00 +0100 TenneT further facilitates energy transition, while posting stable financial results https://www.tennet.eu/news/detail/tennet-further-facilitates-energy-transition-while-posting-stable-financial-results/ Over 2016, the high-voltage grids operated by TenneT continued to achieve a high security of supply of 99.9999 percent uptime. This was supported by a significant level of investment (EUR 1,848 million) and solid financial results, as presented today in TenneT’s integrated annual report and 2016 financial statements. Over 2016, the high-voltage grids operated by TenneT continued to achieve a high security of supply of 99.9999 percent uptime. This was supported by a significant level of investment (EUR 1,848 million) and solid financial results, as presented today in TenneT’s integrated annual report and 2016 financial statements.

    TenneT CEO Mel Kroon: ‘Our society is becoming more and more dependent on electricity. Investments in the high-voltage energy systems are in everyone’s interest as they facilitate the transition to renewable energy and at the same time maintain security of supply. Large-scale generation from renewable sources takes place at non-conventional locations on land and at sea. If we want to exploit all this green electricity in our Northwest-European region to the full, we cannot do without new power transmission links, both onshore and offshore. Innovations, partnerships and international cooperation are vital for this. In 2016, we have taken effective steps in all of these areas and we will continue to do so in the years to come.’

    Energy transition: offshore wind

    In 2016, the Dutch government assigned TenneT as the Netherlands’ offshore grid operator. This means TenneT will be responsible for the development, construction and operation of an offshore energy system that, by 2023, will transport 3,500 MW (the annual power consumption of approximately 4 million households) of sustainable wind power from the North Sea to private and business users. A number of onshore and offshore geological surveys have been carried out for the Borssele and Hollandse Kust Zuid wind farm zones. For Borssele (2 × 700 MW), the tendering process  for the required cables (late 2016) and offshore transformer platforms (early 2017) has been completed, and for Hollandse Kust Zuid the preferred route, via Maasvlakte North, has been determined. For the third designated wind farm zone, Hollandse Kust Noord, TenneT started the first preparations.

    The tenders for the Borssele wind farms produced striking results. With 7.27 and 5.45 cent per kWh, the winning tenders were well below previous auction results. This is partly due to low market prices for steel and other commodities and low financing costs, but also due to the fact that wind farm developers have the security of having TenneT as the designated offshore grid operator.

    For the medium term, TenneT sees opportunities for further expansion of wind power capacity in the Dutch part of the North Sea. The 'IJmuiden Ver' zone, for instance, can accommodate enough wind farms to generate thousands of megawatts. These wind farms could be connected to the grid using conventional methods or perhaps a hybrid method, in which the cable would also function as an interconnector between the Netherlands and the United Kingdom – a so-called “wind connector”. During 2016 TenneT announced its long-term vision for an “energy island” further offshore on the North Sea, which could connect wind farms with a combined capacity of up to 70 gigawatts to the German, Dutch, Belgian, Norwegian and Danish electricity markets. In this “hub-and-spoke” model, the wind connector concept could be implemented on a large scale.

    In the German part of the North Sea, TenneT currently operates nine offshore grid connections: two alternating-current (AC-) and seven direct-current (DC-) connections. This brings the current total available capacity for transmission of offshore wind power to 5,221 MW. This is more than enough to transport the total installed capacity of 3,783 MW generated by offshore wind farms. By 2019 TenneT expects to have 7,132 MW offshore transmission capacity installed. By 2025 this is expected to grow to more than 10 GW.

    Optimization of international electricity markets

    In 2016, TenneT reaffirmed its leading role in initiating and implementing cross-border transmission capacity to facilitate the market – a strategy dating back to 2002. The construction of two new cross-border offshore electricity connections was started in 2016: a 1,400 MW connection between Germany and Norway (NordLink) and a 700 MW connection between the Netherlands and Denmark (COBRAcable). Onshore, the expansion of cross-border transmission capacity is also in full operation with the construction of the (1,500 MW) Doetinchem-Wesel link and the upgrade of the existing Meeden-Diele connection between the Netherlands and Germany. Also an increase in the cross-border transmission capacity between the Netherlands and Belgium is in preparation.

    Financial results and investments

    Key underlying*) financial figures (in millions of euros)20162015
    Revenue3,2273,290
    Earnings before interest and taxes (EBIT)8341,075
    EBIT, corrected for special items701704
    Investments in tangible fixed assets1,8482,405
    Total fixed assets18,97415,424
    Net interest-bearing debt, adjusted7,3475,736
    Dividend to Dutch State146196

    *) Contrary to IFRS, ‘underlying’ figures recognise regulatory assets and liabilities in connection with TenneT’s regulated activities whereas IFRS does not allow this. This means that amounts resulting from past events and which are allowed or required to be settled in future grid tariffs are recognized separately.

    Underlying revenue and EBIT

    TenneT’s 2016 underlying revenue of EUR 3,227 million decreased from EUR 3,290 million in 2015, mainly due to lower reimbursement of system service expenses, offset by additional revenue generated by our growing asset base. Underlying EBIT decreased from EUR 1,075 million in 2015 to EUR 834 million in 2016. Excluding special items, underlying EBIT was in line with prior year, i.e. EUR 701 million in 2016 compared to EUR 704 million in 2015. Higher revenue due to a larger investment base was offset by higher operating expenses and lower income from non-regulated activities.

    TenneT CFO Otto Jager commented: "Our solid financial results mean that we can continue to finance investments in the energy transition. At the same time, as largest Dutch corporate issuer of 'green debt', we support the development of a sustainable investor market."

    Investments & financing

    Capex totalled EUR 1,848 million in 2016, of which EUR 575 million in the Netherlands and EUR 1,273 million in Germany. This continuing high level of investment also explains the increase of the net interest-bearing debt position to EUR 7,347 million at 31 December 2016.

    To meet the higher funding need resulting from the large investment portfolio, TenneT successfully completed a EUR 500 million green Schuldschein issue in May and issued a total of EUR 1.5 billion of green bonds in 2016. At the end of 2016, TenneT’s shareholder, the Dutch State represented by the Ministry of Finance, committed to contributing up to EUR 1.2 billion of additional equity over the 2017-2020 period to be paid out in four tranches. The final tranche of EUR 410 million in 2020 is conditional and will be granted if necessary, taking into account TenneT's financial situation at that time.

    Senior unsecured credit ratings as of 31 December 2016

    Long-term ratingShort-term rating
    Standard & Poor’sA- (stable outlook)    A-2
    Moody’s Investor ServiceA3 (stable outlook)P-2

    Dividend

    Dutch society also financially benefits – via TenneT’s shareholder, the State of the Netherlands – from TenneT's activities. Over the financial year 2014 TenneT distributed a dividend of EUR 116.5 million, followed by EUR 196 million over 2015 and EUR 146 million over 2016. From 1999 to 2017, the State of the Netherlands received a total of EUR 905 million in aggregate dividends from TenneT.

    Outlook

    Over the next ten years TenneT expects to invest EUR 25 billion in onshore and offshore grid infrastructure across the Netherlands and Germany. These grid expansions will ensure a reliable supply of renewable energy throughout Europe and in TenneT’s service areas in particular. The ongoing coupling of the European energy markets will lead to more convergence of electricity prices in the various European countries, and will make electricity more affordable for end users.

    In the Netherlands, planned investments include maintenance of the existing grid as well as grid expansions to accommodate larger and more volatile electricity flows. The largest projects are the offshore grid (3,500 MW), the Randstad 380 kV North Ring, South-West 380 kV, North-West 380 kV, the upgrade of the national 380 kV ring, Doetinchem-Wesel and COBRAcable.

    In Germany, too, new or upgraded electricity connections are required to accommodate the strong and continued growth in renewable energy generation, often at non-traditional locations. More than 20 large-scale projects are currently in the planning or implementation phase. TenneT is also preparing for two unique underground direct-current connections stretching over many hundreds of kilometres, i.e. SuedLink and SuedOstLink. The German government introduced legislation to ensure that, for the most part, these connections are installed underground. This does mean that implementation of these projects will be delayed by a number of years and that the cost will be significantly higher than originally anticipated.

    Innovation

    Similar to the earlier Randstad 380 kV South Ring project, the North Ring will include almost 10 kilometres of 380 kV cable (AC), for which TenneT will use a newly developed 380kV cable with a core made out of aluminium instead of copper. In addition to its high transmission capacity and long service life, this new type of cable will result in cost savings of 20 to 30 percent.
    For overhead 380 kV connections, including the Randstad 380 kV North Ring, South-West 380 kV, North-West 380 kV and Doetinchem-Wesel, TenneT will continue to use its innovative Wintrack pylons. Due to their slender design, these pylons significantly reduce the size of the electromagnetic field and have less of a visual impact on the environment.

    Furthermore, TenneT is examining the possibilities for electricity storage using batteries, which would increase the flexibility and efficiency of the power grid even with strong growth in fluctuating supply from renewable sources (wind and solar). In a pilot project in 2016, TenneT and NewMotion utilized the charging systems of thousands of electric vehicles to contribute to the stability of the grid. In 2017, TenneT will work together with different parties in a number of pilot projects aimed at making the grid more flexible and keeping it solid.

    Integrated Annual Report 2016

    More information about TenneT may be found in our Integrated Annual Report 2016, which is published at annualreport.tennet.eu

    Related to TenneT's green funding of its investment portfolio through the issuance of Green Bonds (since 2015), TenneT published the Green Finance Report 2016.

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    news-801 Wed, 21 Dec 2016 11:00:00 +0100 Additional equity for TenneT investments in the Netherlands formally agreed https://www.tennet.eu/news/detail/additional-equity-for-tennet-investments-in-the-netherlands-formally-agreed/ The process for the State of the Netherlands to make an additional capital increase in TenneT has been formally completed. In July 2016 Finance minister Jeroen Dijsselbloem submitted the intention to make the capital increase to the House of Representatives.   As a shareholder the State will make available €1,190 million of additional equity to the state-owned enterprise to enable the financing of future investments in the Dutch grid. TenneT contributes significantly to a sustainable, reliable and affordable supply of energy. To continue doing so, the company will invest substantially in strengthening the onshore grid in the coming period. The connection of offshore wind farms in the North Sea is also pivotal to achieving the Dutch Cabinet’s sustainability ambition. 

    The process for the State of the Netherlands to make an additional capital increase in TenneT has been formally completed. In July 2016 Finance minister Jeroen Dijsselbloem submitted the intention to make the capital increase to the House of Representatives.  

    As a shareholder the State will make available €1,190 million of additional equity to the state-owned enterprise to enable the financing of future investments in the Dutch grid. TenneT contributes significantly to a sustainable, reliable and affordable supply of energy. To continue doing so, the company will invest substantially in strengthening the onshore grid in the coming period. The connection of offshore wind farms in the North Sea is also pivotal to achieving the Dutch Cabinet’s sustainability ambition. 

    By law TenneT is responsible for the reliability, safety and security of supply of the Dutch high-voltage grid. Installation of the offshore grid is now also a formal task of TenneT. In the years up to and including 2025, TenneT expects to have to invest between five and seven billion euro in maintaining, renovating and if necessary enlarging the grid in the Netherlands. Approximately one third of this amount is needed to connect offshore wind farms.

    Important for economy and society

    TenneT's investments are of great importance to the security of (power) supply and thus society. By enlarging and strengthening the onshore grid and installing the offshore grid, TenneT makes a key contribution to a sustainable, reliable and affordable supply of energy. Moreover the investments being made by TenneT are necessary to be able to fulfil the arrangements contained in the National Energy Agreement and the Cabinet’s sustainability ambition.

    Scale of capital injection

    In the letter to the House of Representatives on 12 July this year, minister Dijsselbloem said that a number of basic principles had been applied to determine the amount of the additional capital increase. The same principles are embodied in government policy on state-owned enterprises. The minister wrote that the first basic principle was to retain TenneT’s creditworthiness. It means TenneT will remain financially healthy and retain sufficient possibilities to raise money on the capital market. This is of great importance to the financing of the company’s investment programme. In its shareholder role the State will contribute only to investments in the Dutch part of the grid administrator’s operations. The shareholder will not provide capital until actually needed by TenneT. The additional equity of €1,190 million will be divided into four tranches spread over four years. TenneT intends to draw down the first tranche of €150 million early January 2017. In 2019 the State will examine whether the fourth tranche of €410 million is still necessary (in its entirety).

    Return

    TenneT will use the capital increase for investments in the Dutch grid. On these investments TenneT achieves a return higher than the interest expenses payable by the State. As a shareholder the State benefits through higher profit distributions. So in addition to the societal benefits of TenneT’s investments the State also obtains a financial advantage.

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    news-749 Mon, 10 Oct 2016 20:58:24 +0200 Again a successful issue of Green Bond TenneT https://www.tennet.eu/news/detail/again-a-successful-issue-of-green-bond-tennet/ TenneT successfully issues another Green Bond with very long maturityToday’s EUR 500m Green Bond issue brings total long-term debt in green format to EUR 3bnTenneT largest (corporate) issuer in the Netherlands of green debt
    • TenneT successfully issues another Green Bond with very long maturity
    • Today’s EUR 500m Green Bond issue brings total long-term debt in green format to EUR 3bn
    • TenneT largest (corporate) issuer in the Netherlands of green debt

    TenneT Holding B.V. (rated A3/A-) today successfully launched and priced another Green Bond issue, a EUR500m (17 year) bond issue with a coupon of 1.25% with the support of three banks, Lloyds Bank, Rabobank and Royal Bank of Scotland.

    Investing in green energy

    Today’s announcement relates to the issuance of Green Bonds for investments in the transmission of renewable electricity from offshore wind farms to the onshore electricity grid. The following offshore projects are financed with the proceeds:

    • DolWin1 (commissioned 2015): a 165 km HVDC (high voltage direct current) link with 800 MW capacity.
    • SylWin 1 (commissioned 2015): a 205 km HVDC link with 864 MW capacity.
    • DolWin2 (commissioned 2016): a 135 km HVDC link with 916 MW capacity.
    • DolWin3 (commissioning 2017): a 162 km HVDC link with 900 MW capacity.
    • BorWin3 (commissioning 2019): a 160 km HVDC link with 900 MW capacity.
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    news-694 Fri, 29 Jul 2016 08:00:00 +0200 TenneT’s half-year figures show good progress and continued high security of supply https://www.tennet.eu/news/detail/tennets-half-year-figures-show-good-progress-and-continued-high-security-of-supply/ Security of supply remains high at 99.999%EUR 875 million invested in Dutch and German high-voltage grid in first half of 2016Revenue increases from EUR 1,395 million to EUR 1,546 million Underlying operating result (EBIT) decreased by EUR 76 million to EUR 414 million due to lower impact of special items EUR 1.5 billion of new green bonds and green loans issued
    • Security of supply remains high at 99.999%
    • EUR 875 million invested in Dutch and German high-voltage grid in first half of 2016
    • Revenue increases from EUR 1,395 million to EUR 1,546 million
    • Underlying operating result (EBIT) decreased by EUR 76 million to EUR 414 million due to lower impact of special items
    • EUR 1.5 billion of new green bonds and green loans issued

    In the first six months of 2016, TenneT has succeeded in maintaining the security of electricity supply at an exceptionally high level of 99.999%, and has made further progress in integrating the North-West European electricity markets. These core activities were complemented by a solid financial performance. Regretfully an employee from Liandon, one of TenneT's contractors, was fatally injured in a work accident that occurred in February 2016. 

    Energy transition

    The energy transition is in full swing, not only in Germany but also in the Netherlands. Earlier this year, the Dutch Senate provided the required legal basis for the development of offshore wind energy in the Dutch part of the North Sea. Subsequently, the Dutch regulator (ACM) certified TenneT as offshore grid operator in July. As a result, the Dutch minister of economic affairs can now officially appoint TenneT as developer and operator of offshore grid connections in the Dutch part of the North Sea. In June, TenneT presented its vision for further integration and collaboration among the countries bordering the North Sea with a view to achieving medium- to long-term sustainability targets. The development of an artificial island in the middle of the North Sea that can serve as a ‘hub and spoke’ for a European sustainable energy supply system is central to TenneT’s North Sea Infrastructure concept. 

    TenneT CEO Mel Kroon commented: “In this part of Europe the energy transition means the availability and demand of renewables has to be connected over big distances which requires infrastructure. In addition, further North  West European integration and collaboration on the energy transition is essential if we want to continue achieving societal sustainability targets in the future.”

    Financial results

    In the first half of 2016, TenneT continued to invest heavily in reinforcing the electricity infrastructure in the Netherlands and Germany in order to maintain the existing high level of security of supply and to integrate renewable energy sources into the grid. Investments in tangible fixed assets totalled EUR 875 million in the first six months of 2016. 

    Key underlying1 financial results

    (Figures in millions of euros)30 June 201630 June 2015
    Revenue1,5461,395
    EBIT414490
    Investments in tangible fixed assets8751,196
    (Figures in millions of euros)30 June 201630 June 2015
    Total assets16,88115,424
    Net interest-bearing debt, adjusted6,6825,703
    Equity3,7363,803

    Underlying revenue rose from EUR 1,395 million in the first half of 2015 to EUR 1,546 million in the first six months of this year. This increase is attributable to the growth in TenneT's asset base and compensation of the increased costs of system services. Underlying EBIT decreased from EUR 490 million at 30 June 2015 to EUR 414 million at 30 June 2016, mainly due to the impact of special items which were higher in 2015. Among others this related to the release of offshore liability provisions and an incidental gain on the sale of APX shares in 2015. The underlying result for the first half of 2016 was negatively impacted by a change of discount factor applied to German pension provisions, which will be settled in future tariffs.

    The regulatory authorities in the Netherlands (Authority for Consumers & Markets, ACM) and Germany (Bundesnetzagentur, BNetzA) both announced plans to reduce the permitted (‘regulatory’) rate of return. The regulatory rate of return on equity capital is proposed to be decreased from 5.6% to 4.9% (after tax) in the Netherlands, and from 9,05 % (7.4% after tax) to 6,91 % (5.6% after tax) in Germany. Final decisions are expected this fall.

    TenneT CFO Otto Jager commented: “The operating performance we have realized is in line with our total investments and supports our debt portfolio, which currently amounts to EUR 5.8 billion. However, a stable regulatory regime is essential in order to continue obtaining financing to support our extensive investment agenda.”

    Financing

    In June 2016, TenneT issued EUR 1 billion in so-called ‘green bonds’ for investments in the transmission of renewable electricity from offshore wind farms to the onshore electricity grid. In May 2016, TenneT also issued EUR 500 million in ‘green loans’ in Germany. The issue of green bonds and loans demonstrates TenneT’s commitment to working with stakeholders to continually improve and innovate in efforts to realize a more sustainable energy future. As the first Dutch corporate issuer of green bonds, TenneT today will open the trading day on the Euronext stock exchange in Amsterdam. 

    Earlier this month, the Dutch State announced its intention to make an additional equity contribution of up to EUR 1.2 billion over the years 2017-2020 for financing of required investments in the Dutch electricity grid. 

    TenneT's senior unsecured credit ratings remain unchanged in the first half of 2016:

    Long-term ratingShort-term rating
    Standard & Poor’sA- (stable outlook)A-2
    Moody’sA3 (stable outlook)P-2

     

    Progress on onshore grid expansion projects in the Netherlands

    In the Netherlands the construction of a number of large high-voltage infrastructure projects is going according to plan. TenneT has started work on the construction of a fourth cross-border electricity connection (interconnector) from Doetinchem in the Netherlands to the German town of Wesel. The construction of the so-called North Ring of the Randstad 380 kV connection (serving the northern section of the Randstad conurbation) is also proceeding apace. In both the North and South-West of the Netherlands, TenneT and the Dutch Ministry of Economic Affairs are consulting closely with local and regional stakeholders about the expansion and upgrading of the electricity grid.

    DC connections and underground cables in German onshore grid projects

    TenneT has been officially designated to construct the SuedOstLink connection between the federal states of Saxony-Anhalt and Bavaria. This will be the second largest direct-current (DC) onshore electricity connection in Germany, after the SuedLink connection. In January 2016, the German parliament adopted a law that prioritizes the underground installation of DC cables. This means that the routes of DC connections will be redesigned at many locations to make underground installation possible. The long distances of the German onshore grid connections, the substantial number of stakeholders as well as technical, permitting and licensing complexity make these projects challenging and costly.

    Offshore developments

    In March 2016 the Dutch Senate approved the amended Electricity Act, which formalizes TenneT’s role as the developer and operator of the offshore electricity grid. In the coming years TenneT will build five identical offshore platforms with a total capacity of 3,500 MW (powering 3.5 million households with green electricity in the Dutch sector of the North Sea in order to transport wind energy to the onshore grid. In Germany, TenneT is working on the DolWin3, BorWin3 and Nordergründe offshore grid connections, which have a joint capacity of 2,827 MW. These projects will increase the total wind energy capacity connected to the German grid to 7,132 MW by 2019. 

    TenneT has also started preparations for the construction of NordLink, the first high-capacity electricity cable (1,400 MW) between Norway and Germany. NordLink will complement TenneT’s existing subsea power cables with Norway and with the United Kingdom, as well as the three existing onshore high-voltage connections between the Netherlands and Germany (with a fourth one under construction). In the autumn of 2016 TenneT will start work on the COBRACable, a new 700 MW interconnector that will connect the Dutch and Danish electricity grids. 

     

    1 Contrary to the International Financial Reporting Standards (IFRS), the so-called ‘underlying’ figures reflect regulatory assets and liabilities in connection with TenneT’s regulated activities. This means that amounts that result from past events and that are allowed or required to be settled in future grid tariffs are recorded as assets or liabilities.

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    news-621 Tue, 07 Jun 2016 09:51:00 +0200 TenneT successfully issues EUR 1 bn Green Bond https://www.tennet.eu/news/detail/tennet-successfully-issues-eur-1-bn-green-bond-1/ Market shows keen interest: Green Bond almost four times oversubscribedTenneT's second consecutive EURO Green Bonds issue from its established programmeMoody's investors services assigns Green Bond Assessment of GB1 ("Excellent")
    • Market shows keen interest: Green Bond almost four times oversubscribed
    • TenneT's second consecutive EURO Green Bonds issue from its established programme
    • Moody's investors services assigns Green Bond Assessment of GB1 ("Excellent")

    TenneT Holding B.V. (rated A3/A-) today successfully launched and priced its second Green Bond issue, a EUR1bn dual tranche (10 and 20 year) bond issue, each sized at EUR 500m with coupons of 1.000% and 1.875% respectively with the support of five banks, Barclays Bank plc, BNP Paribas, Deutsche Bank AG, ABN AMRO Bank N.V. and SMBC Nikko Capital Markets Limited.

    Otto Jager, TenneT’s Chief Financial Officer, said: “This second consecutive Green Bond issue demonstrates that the green project portfolio approach works very well. By adding one further offshore German wind transmission project to the programme provides us the possibility to continue the issuance of Green Bonds. This underpins TenneT's ambition to be the best performing TSO in Northwest Europe in terms of Corporate Social Responsibility." 

    Moody's has assigned under its newly developed Green Bond Assessment methodology these green bonds a GB1, which is on a scale of GB1 (= Excellent) to GB5 (= Poor) the highest rating possible evidencing the fact that TenneT has followed the green bond principles very closely.

    Investing in green energy

    Today’s announcement relates to the issuance of Green Bonds for investments in the transmission of renewable electricity from offshore wind farms to the onshore electricity grid. The following offshore projects are financed with the proceeds:

    • DolWin1 (commissioned 2015): a 165 km HVDC (high voltage direct current) link with 800 MW capacity.
    • DolWin2 (commissioned 2016): a 135 km HVDC link with 916 MW capacity.
    • DolWin3 (commissioning 2017): a 162 km HVDC link with 900 MW capacity.
    • BorWin3 (commissioning 2019): a 160 km HVDC link with 900 MW capacity.

    TenneT Green Bonds could not only be used to finance other sustainable projects of TenneT in Germany, but in the future also for Dutch offshore projects to connect offshore wind farms to the Dutch grid.

    TenneT’s investments in offshore wind energy projects across the Netherlands and Germany are expected to total EUR 8 to 10 billion over the next 10 years. In the period up to 2019, TenneT is realizing over 7,000 megawatts (MW) of connection capacity for offshore wind farms in the German sector of the North Sea, transmitting electricity equivalent to the annual power consumption of approx. 9 million households. By 2023, the TSO expects to have realized 3,500 MW of connection capacity in the Dutch sector of the North Sea, corresponding to the annual power consumption of over 4 million households.

    Green Bonds Framework

    Earlier (April 2015) TenneT published a Green Bonds Framework which serves as a structure for verifying the sustainability quality (i.e. the social and environmental added value) of the projects to be financed through the issuance of Green Bonds. The Framework was prepared in collaboration with oekom Research AG, who provides a second-party opinion in relation to a potential upcoming Green Bond. It is available on TenneT’s website at GreenBond.

    Additionally TenneT has incorporated into its existing EMTN (Euro Medium Term Note) Programme specific Use of Proceeds provisions designed to be aligned with the Green Bond Principles.

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    news-341 Thu, 12 May 2016 09:00:00 +0200 TenneT successfully issues inaugural EUR 500m Green Schuldscheine https://www.tennet.eu/news/detail/tennet-successfully-issues-inaugural-eur-500m-green-schuldscheine/ Market shows keen interest: Green Schuldschein more than two times oversubscribedDiversification of investor base and funding sourcesGreen Schuldschein follows inaugural green bond of 2015
    • Market shows keen interest: Green Schuldschein more than two times oversubscribed
    • Diversification of investor base and funding sources
    • Green Schuldschein follows inaugural green bond of 2015

    TenneT Holding B.V. (rated A3/A-) today successfully completed its inaugural Green Schuldschein issue. The EUR 500m Schuldschein, a type of privately-placed German debt similar to a bond, was issued with the support of Helaba and ING Bank in six tranches: 

    AmountMaturityCoupon
    EUR 77m6yrs0.646%
    EUR 100m8yrs0.989%
    EUR 55m10yrs 1.310%
    EUR 50m12yrs1.500%
    EUR 138m15yrs1.750%
    EUR 80m20yrs2.000%

    The offer with initially a volume of EUR 300 million was more than two times oversubscribed, which allowed TenneT to upsize to an overall issuance volume of EUR 500 million and attracted amongst others German savings banks and German and international institutional investors.

    Otto Jager, TenneT’s Chief Financial Officer, said: “Today’s inaugural Green Schuldschein issue demonstrates TenneT's ability to diversify its financing sources and investor base to carry out our investment plans. The green angle further establishes our ambition to be among the best performing TSOs in North-West Europe on Corporate Social Responsibility. This Green Schuldschein supports investment in three offshore wind transmission projects in Germany.”

    Investing in green energy

    Today’s announcement relates to the issuance of Green Schuldschein for investments in the transmission of renewable electricity from offshore wind farms to the onshore electricity grid. The following offshore projects are financed with the proceeds:

    • DolWin1 (commissioning 2015): a 165 km HVDC (high voltage direct current) link with 800 MW capacity.
    • DolWin2 (commissioning 2015): a 135 km HVDC link with 916 MW capacity.
    • DolWin3 (commissioning 2017): a 162 km HVDC link with 900 MW capacity. 

    TenneTs investments in offshore wind energy projects across the Netherlands and Germany are expected to total EUR 7 to 9 billion over the next 10 years. In the period up to 2019, TenneT is realizing over 7,000 megawatts (MW) of connection capacity for offshore wind farms in the German sector of the North Sea, transmitting electricity equivalent to the annual power consumption of approx. 9 million households. By 2023, the company expects to have realized 3,500 MW of connection capacity in the Dutch sector of the North Sea, corresponding to the annual power consumption of over 4 million households.

    Green Bonds Framework

    In April 2015 TenneT published a Green Bonds Framework which serves as a structure for verifying the sustainability quality (i.e. the social and environmental added value) of the projects to be financed through the issuance of Green debt instruments. The Framework has been reviewed by oekom Research AG, who  provides also a second-party opinion in relation to this Green Schuldschein. It is available on  TenneT’s website.

    Additionally TenneT has incorporated into Schuldschein documentation specific Use of Proceeds provisions designed to be aligned with the Green Bond Principles.

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    news-58 Tue, 08 Mar 2016 09:53:00 +0100 Investments TenneT for tomorrow's onshore and offshore electricity grid reach all-time high https://www.tennet.eu/news/detail/investments-tennet-for-tomorrows-onshore-and-offshore-electricity-grid-reach-all-time-high/ Arnhem, The Netherlands – During 2015 TenneT delivered very high grid reliability again, in combination with a robust financial performance. Despite a rare and regrettable power outage in the Netherlands on 27 March 2015, which affected a large part of the province of Noord-Holland and a small part of Flevoland, overall grid availability remained high at 99.9975%. Arnhem, The Netherlands – During 2015 TenneT delivered very high grid reliability again, in combination with a robust financial performance. Despite a rare and regrettable power outage in the Netherlands on 27 March 2015, which affected a large part of the province of Noord-Holland and a small part of Flevoland, overall grid availability remained high at 99.9975%.

    • Investments in maintenance and expansion of high-voltage grids at all-time high at EUR 2.4 billion
    • Underlying EBIT, corrected for special items, increased by 18% to EUR 704 million
    • Security of supply remained at high level: 99.9975%
    • Dutch State to receive dividend of EUR 196 million
    • Investment program over the next 10 years projected to be EUR 22 billion, to be financed, among others, with further ‘green bonds’

    TenneT CEO Mel Kroon commented: “A power outage like this demonstrates how much we have come to rely on the electricity grid. It is important to invest effectively and efficiently in high voltage grids that are needed in a society that is increasingly based on the use of electricity. We will continue to work hard and to invest to maintain the quality of our existing grid as well as to be able to transport large volumes of renewable energy from new sources.”

    TenneT also made great strides in 2015 further integrating the Northwest European electricity market and enabling the transition to a renewable energy future. The Dutch government intends to appoint TenneT to design, build and manage an offshore grid on the North Sea that will make 3,500 MW of renewable wind energy available for the Netherlands by 2023. In Germany, TenneT installed five new direct current (DC) offshore connection systems bringing available capacity for transporting wind energy generated at sea to 4,300 MW – powering millions of households with green electricity. By 2019, TenneT expects to have completed 7,100 MW of offshore connection capacity, exceeding the German government’s target of 6,500 MW of installed offshore wind energy capacity by 2020.

    In addition, during 2015, TenneT played a leading role in making more cross-border electricity transmission capacity available to the market, using a mechanism called flow-based market coupling, bringing electricity prices across Europe closer together. Two new int*erconnector-projects started development to connect Germany to Norway (NordLink) and the Netherlands to Denmark (COBRA cable) for greater security of supply and to allow for more distribution of renewable energy in the Northwest European area.

    Key underlying* financial figures (in millions of euros)

    2015          2014
    Revenue3,2902,315
    Earnings before interest and taxes (EBIT)          1,075725
    EBIT, corrected for special items704596
    Investments in tangible fixed assets2,4052,296
    Net interest-bearing debt, adjusted5,7034,167
    Dividend to Dutch State196117


    *) Contrary to IFRS 'underlying' figures reflect regulatory assets and liabilities in connection with TenneT’s regulated activities whereas IFRS does not allow this. This implies that amounts resulting from past events and which are allowed or required to be settled in future grid tariffs are reflected separately.

    Senior unsecured credit ratings as of 31 December 2015

    Long-term rating          Short-term rating
    Standard & Poor’sA- (stable outlook)A-2
    Moody’s Investor Service          A3 (stable outlook)P-2

    TenneT CFO Otto Jager commented: “Our financial performance is in line with the growth in our asset base. We have a stable basis to finance our investment portfolio the coming years, through debt from institutional investors and equity from retained earnings. On the Dutch side, we expect part of the required financing to be provided by a capital contribution from our shareholder within the coming years.”

    The good results achieved in 2015 will benefit TenneT’s shareholder, the State of the Netherlands as represented by the Ministry of Finance. In financial year 2014 TenneT already distributed a dividend of EUR 116.5 million and at EUR 196 million the dividend for 2015 is considerably higher still. From 1999 to 2015, dividends from TenneT to the State of the Netherlands total EUR 759 million.

    Underlying revenue and EBIT

    TenneT’s underlying revenue rose from EUR 2,315 million in 2014 to EUR 3,290 million in 2015, mainly driven by the growing asset base due to investments. Particularly TenneT’s investments in Germany contributed positively to revenue, as the German regulatory framework provides for an immediate return on invested capital during the construction phase.

    Underlying EBIT increased by EUR 350 (+48%) million to reach EUR 1,075 million in 2015. Excluding special items, underlying EBIT increased by EUR 108 million (+18%) to EUR 704 million, reflecting the growth in TenneT’s asset base. Special items for 2015 included the reversal of an earlier impairment due to a favourable decision by the Dutch administrative court related to regulation applicable to TenneT, the release of offshore provisions, as delays and interruptions of offshore connection systems have become less likely, and reimbursement of offshore operating expenses in excess of actual costs incurred, as not all of TenneT’s offshore links were fully operational yet in 2015.

    Investments and financing

    In 2015 TenneT’s investments in tangible fixed assets amounted to EUR 2,405 million, of which EUR 473 million in the Netherlands, EUR 1,460 million in grid connections for offshore wind farms, EUR 466 million in the German onshore grid and EUR 6 million in non-regulated activities. This level of investment also explains the increase of the net interest-bearing debt position by EUR 1,536 million to EUR 5,703 million in 2015.

    TenneT was the first non-financial company in the Netherlands to issue EUR 1 billion of so-called ‘green bonds’. With this TenneT has successfully introduced a new form of corporate fundraising. The initial offering was twice oversubscribed and has the potential to develop into an extensive multi-billion euro programme for financing investments in renewable energy projects. The European Investment Bank (EIB) also invested in TenneT’s renewable energy projects, and extended a EUR 500 million loan to TenneT to finance the SylWin1, HelWin1 and DolWin1 projects. In total, the EIB has EUR 1.2 billion of commitments to TenneT.

    In February 2015 TenneT concluded an agreement with Germany’s KfW bank concerning a joint investment in the German section of the NordLink interconnector. KfW is investing EUR 500 million of equity (representing a 25% stake) in this subsea electricity connection between Germany and Norway. Norwegian TSO Statnett is responsible for financing the Norwegian section of NordLink (50% stake). TenneT has previously entered into successful partnerships for the financing of German projects with Mitsubishi Corporation (2012 and 2013) and Pension Denmark (2014), with a total equity commitment of EUR 960 million.

    Technical innovations

    Innovation is essential to the development of a future-proof, reliable, robust and efficient electricity supply system. In response to society’s demand to install more high-voltage lines underground, TenneT is planning a pilot project in the city of Enschede involving an underground superconducting 110 kV cable. This High-Temperature Super Conductor (“HTSC”) is capable of transporting up to five times more electricity than conventional cables, and will be installed over a length of 3.4 kilometres. The project will be a world first: a section of superconducting cable of this length has not yet been installed anywhere else in the world. With these superconducting cables, it should become easier in future to integrate high-voltage lines in urban areas.

    For new high-voltage connections like the Randstad 380 kV North Ring, South-West 380 kV, North-West 380 kV and Doetinchem-Wesel, TenneT will continue to use so-called Wintrack pylons. This innovative pylon design was developed in-house and produces a much smaller magnetic field while allowing for more effective integration into the landscape. The Randstad 380 kV North Ring project will include a nearly 10-km-long section of underground 380 kV cable, as was also the case in the already completed South Ring.

    Furthermore, TenneT is examining the possibilities for electricity storage using batteries, which would increase the flexibility and efficiency of the power grid. TenneT and The New Motion are utilizing the charging systems of thousands of electric vehicles to contribute to the stability of the grid. The increase in the feed-in of electricity from renewable sources like wind and solar energy requires more frequent adjustments to maintain the energy balance. At the same time, the growing share of ‘green’ electricity in the overall supply demands new solutions to cope with fluctuations in the electricity grid. TenneT is also investigating other options for large-scale electricity storage using batteries.

    Further investments

    In the coming ten years, TenneT expects to invest approx. EUR 22 billion in onshore and offshore electricity infrastructure. Extra capacity will relieve grid congestion, for example on windy days, and will transport energy further afield to where it is needed. It will ensure a steady supply of renewable energy across Europe in general, and in TenneT’s markets in particular, and cause further convergence of electricity prices among the different European countries, ultimately making electricity cheaper for end users.

    In the Netherlands planned investments include maintenance of the existing onshore grid as well as onshore expansion to accommodate larger and more volatile electricity flows. The most prominent projects are the North Ring of the Randstad 380 kV connection, the South-West 380 kV and North-West 380 kV connections, and the upgrade of the national 380 kV ring. In addition, TenneT is continuing according to plan with its preparations for the realization of an offshore AC grid in the Dutch sector of the North Sea, under the Offshore Wind Energy Act of 2015, targeting 3,450 MW of offshore wind capacity to be operational by 2023.

    In Germany TenneT is investing in onshore AC infrastructure and offshore DC grid connections. The German onshore high-voltage grid is undergoing considerable expansion with a view to the energy transition (Energiewende). New or upgraded electricity connections are required to accommodate the strong growth in renewable energy generation, frequently at non-traditional locations. Over twenty large projects are currently in the planning or implementation phase. In addition, TenneT is currently planning two first of a kind DC connections on land to secure the power supply in southern Germany in the future.

    Integrated Annual Report 2015

    More information about TenneT may be found in our Integrated Annual Report 2015, which is published at annualreport.tennet.eu. A shortenend version in Dutch is available at jaarverslag.tennet.eu.

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    news-63 Tue, 16 Feb 2016 10:19:00 +0100 Announcement Annual Results 2015 and Annual Report 2015 https://www.tennet.eu/news/detail/announcement-annual-results-2015-and-annual-report-2015/ On March 8, TenneT publishes its annual results and integrated annual report for the year 2015. On that day also a press conference is scheduled.

    Interested journalists are welcome and can contact TenneT Media Relations for more information via communicatie(at)tennet.eu, +31 373 2600 or jeroen.brouwers(at)tennet.eu.

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    news-75 Fri, 18 Dec 2015 00:00:00 +0100 Standard and Poor's revised TenneT's hybrid equity content back to intermediate https://www.tennet.eu/news/detail/standard-and-poors-revised-tennets-hybrid-equity-content-back-to-intermediate/ Following TenneT's waiver of certain call option rights in its hybrid on 14 December 2015, Standard & Poor's Ratings Services revised the equity content of TenneT's hybrid back to "intermediate" and affirmed its 'A-' corporate credit rating on TenneT. The outlook remains stable.

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    news-78 Mon, 14 Dec 2015 11:11:00 +0100 Waiver of Rights in relation to outstanding Perpetual Capital Securities https://www.tennet.eu/news/detail/waiver-of-rights-in-relation-to-outstanding-perpetual-capital-securities/ On 27 October 2015, Standard & Poor's Ratings Services (“S&P”) revised the equity content that they have assigned on several corporate hybrids including TenneT's €500,000,000 Reset Perpetual Capital Securities issued on 4 February 2010 (the “Capital Securities”) to “minimal” (0%). According to S&P, the conditions under which the Issuer may redeem the Securities in connection with certain rating agency actions are no longer consistent with S&P's equity content criteria. On 27 October 2015, Standard & Poor's Ratings Services (“S&P”) revised the equity content that they have assigned on several corporate hybrids including TenneT's €500,000,000 Reset Perpetual Capital Securities issued on 4 February 2010 (the “Capital Securities”) to “minimal” (0%). According to S&P, the conditions under which the Issuer may redeem the Securities in connection with certain rating agency actions are no longer consistent with S&P's equity content criteria.

    After reviewing possible courses of action and taking into account the interests of all stakeholders, the Issuer has decided to unconditionally and irrevocably waive its call right in relation to the Capital Securities upon the occurrence of a Rating Event (as defined in Condition 6 (e) of the Capital Securities) except as detailed in a Waiver of Rights, “Afstand van Recht” dated 11 December 2015.

    This Waiver of Rights does not in any way alter or affect TenneT's right to call or redeem the Capital Securities under and in accordance with the Conditions upon the occurrence of a Rating Event other than set out in the Waiver of Rights or pursuant to any other provision of the Conditions.

    TenneT expects S&P to promptly restore the "intermediate" equity content to the Securities as a result of the Waiver of Rights.

    Download Waiver of Rights

    Definitions

    Unless the context otherwise requires, capitalised terms used but not defined herein have the same meaning as assigned thereto in the Terms & Conditions of the Capital Securities (the "Conditions") set forth in the prospectus dated 4 February 2010 for the Capital Securities.

    TenneT Holding B.V. Attention: Jeroen Dicker, Group Treasurer P.O. Box 718 6800 AS Arnhem The Netherlands

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    news-83 Wed, 28 Oct 2015 11:31:00 +0100 Standard & Poor's changed equity content of TenneT's hybrid capital, A- credit rating re-confirmed https://www.tennet.eu/news/detail/standard-poors-changed-equity-content-of-tennets-hybrid-capital-a-credit-rating-re-confirmed/ In a statement published yesterday, Standard & Poor’s Ratings Services (“S&Ps”) announced that it has revised the equity content from ‘Intermediate’ (50%) to ‘Minimal’ (0%) for a number of corporate hybrid capital transactions. This is also applicable to TenneT's outstanding hybrid capital instrument (ISIN XS0484213268). Despite the revised equity content assigned, S&P has also affirmed TenneT's long-term corporate credit rating at A-. In a statement published yesterday, Standard & Poor’s Ratings Services (“S&Ps”) announced that it has revised the equity content from ‘Intermediate’ (50%) to ‘Minimal’ (0%) for a number of corporate hybrid capital transactions. This is also applicable to TenneT's outstanding hybrid capital instrument (ISIN XS0484213268). Despite the revised equity content assigned, S&P has also affirmed TenneT's long-term corporate credit rating at A-.

    Knowing that the current terms and conditions of the Hybrid have been acceptable for S&Ps since issuance in February 2010 and no prior indication of a review had been given, TenneT sees no fundamental reason for this unexpected step by S&P.

    TenneT considers hybrid capital to be an important element of TenneT's capital structure and therefore TenneT is considering alternatives to address S&Ps concerns, which could potentially result in the restoration of the ‘Intermediate’ equity content for the Hybrid. TenneT will update the market in due course.

    For further information, please contact:

    Media Relations
    Jeroen Brouwers
    +31263732600 or communications@tennet.eu

    Group Treasurer
    Jeroen Dicker
    +31263732656

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    news-95 Thu, 30 Jul 2015 14:07:00 +0200 TenneT makes large grid investments to secure electricity supply while realising solid half-yearly results https://www.tennet.eu/news/detail/tennet-makes-large-grid-investments-to-secure-electricity-supply-while-realising-solid-half-yearly-r/ TenneT invests EUR 1,196 million in Dutch and German high-voltage grid in first six months of 2015, to secure the uninterrupted supply of electricity and to accommodate increasing renewable energy flows Underlying operating result (EBIT) grows from EUR 368 million to EUR 490 million Preparatory works for Dutch offshore connections have started. In Germany five offshore grid connections have been taken into operation this year, meeting two thirds of the federal government's expansion target Onshore grid expansions in The Netherlands and Germany on track, with several large-scale projects under construction European market integration continues to gain pace
  • TenneT invests EUR 1,196 million in Dutch and German high-voltage grid in first six months of 2015, to secure the uninterrupted supply of electricity and to accommodate increasing renewable energy flows
  • Underlying operating result (EBIT) grows from EUR 368 million to EUR 490 million
  • Preparatory works for Dutch offshore connections have started. In Germany five offshore grid connections have been taken into operation this year, meeting two thirds of the federal government's expansion target
  • Onshore grid expansions in The Netherlands and Germany on track, with several large-scale projects under construction
  • European market integration continues to gain pace
  • TenneT took further steps during the first six months of 2015 to increase the security of electricity supply and further integrate the European electricity market. These core activities were complemented by a solid financial performance.

    Security of supply

    On 27 March 2015 the Netherlands experienced the first large power failure in 18 years, interrupting the flow of electricity to approximately one million households for several hours. Including this interruption TenneT maintained the availability of its high-voltage grid at a level of 99.9976% during the first half of 2015.

    “When it comes to electricity supply, TenneT remains one of the best-performing European transmission grid companies,” says Mel Kroon, CEO. “We all take the continuous availability of electricity for granted in the Netherlands and Germany. This power failure has demonstrated how dependent we all are on a reliable supply of electricity. We regret the power failure, and will make every effort to prevent recurrence of such an incident in the future. Nevertheless, the risk of an interruption in the electricity supply can never be entirely eliminated.”

    Financial results

    During the first six months of 2015, TenneT continued to invest heavily in additional high-voltage grid infrastructure in the Netherlands as well as Germany, both to ensure the continued high reliability of its electricity grids and to accommodate the rapidly rising share of renewable energy sources. Investments in tangible fixed assets rose by 70% from EUR 703 million in the first half of 2014 tot EUR 1,196 million this year.

    As a result, both revenue and operating result (EBIT) grew significantly. Underlying revenue increased by 22% from EUR 1,146 million to EUR 1,395 million over the first six months of the year and underlying EBIT increased from EUR 368 million to EUR 490 million during the same period. In addition, EBIT was positively influenced by good performance (EUR 20 million) of the high-voltage cable between the Netherlands and Great-Britain, in which TenneT holds a 50% stake, and by the incidental profit in connection with the merger of APX (EUR 12 million), a Northwest European electricity exchange in which TenneT held an interest.

    CFO Otto Jager comments: “Our revenues are keeping pace with our growing asset base. For the moment operating and maintenance costs are lagging however, as many new connections are not up and running yet, resulting in extraordinary short-term EBIT performance.”

    2 In contrast to current IFRS, 'underlying' figures reflect regulatory assets and liabilities in connection with TenneT’s regulated activities. This implies that amounts resulting from past events and which are allowed or required to be settled in future grid tariffs are recorded as an asset or liability respectively.

    Progress on grid expansion projects

    In the Netherlands the construction of a number of large high-voltage infrastructure projects is well underway. In the northern part of the Randstad, TenneT is completing a ring connection to increase the security of supply in that part of the country. A fourth cross-border connection with Germany, running from Doetinchem to the German town of Wesel, is under construction with completion expected in 2017. In the southwest of the Netherlands, there has been intensive dialogue with stakeholders on alternative routes for a new connection linking future Dutch offshore wind farms to the high-voltage grid.

    Also in Germany, TenneT made good progress as construction started for several onshore projects across the country as well as for the West Coast line connection between Germany and Denmark. For Suedlink, TenneT's largest onshore project that will connect the north and south of Germany through a direct current link, TenneT works closely with stakeholders to align their needs and requests with respect to the planned trajectory and technical solutions.

    In the first six months of 2015, TenneT took into operation four offshore grid connections with a total capacity of 2,930 MW in the German sector of the North Sea. As a result, the total installed capacity for transporting wind energy from offshore wind farms to the onshore grid has now reached 3,500 MW. TenneT is ahead of schedule in realizing the offshore wind energy targets set by the German government. In the Netherlands, TenneT is making the necessary preparations for connecting five offshore wind farms in the North Sea to the onshore grid. These five wind farms shall have a total capacity of 3,450 MW.

    European integration

    Businesses and consumers alike are benefiting from an integrated European electricity market through more competitive electricity prices.

    Starting May 2015, TenneT and a number of neighbouring transmission grid companies introduced a mechanism which allows electricity to flow and be traded more effectively across borders, referred to as "Flow-Based Market Coupling". This is expected to lead to electricity prices being more equal across Europe.

    In February 2015, TenneT, together with the Norwegian electricity grid company Statnett and German state-sponsored bank KfW, took the decision to invest in NordLink, the first high-capacity power cable between Norway and Germany. The project won a silver medal in the German-Norwegian business award competition, recognising outstanding business opportunities between Germany and Norway. NordLink will complement TenneT's existing subsea power cables between Norway and the Netherlands and Great-Britain and the Netherlands, as well as three existing overland high-voltage connections between the Netherlands and Germany, with a fourth one under construction.

    Issue of ‘Green Bonds’

    In June 2015, TenneT issued its first two tranches of ‘Green Bonds’ for investments in the transmission of renewable electricity from offshore wind farms to the onshore electricity grid. This inaugural Green Bond issue demonstrates TenneT’s commitment to working with stakeholders and to continually improve and innovate its approach to a more sustainable energy future, while at the same time securing low-cost long-term financing to support its investment in three offshore wind energy transmission projects in Germany.

    Solar eclipse

    TenneT's objective to maintain high grid reliability at all times was put to the test by the solar eclipse on 20 March, which had a major impact on the entire European electricity supply system – particularly the German grid – due to strong fluctuations in solar power generation. TenneT and other European TSOs started preparations a year in advance and hence were able to handle the task well. During the first phase of the eclipse, TenneT Germany experienced a drop of 7,000 MW in solar power supply. In the second phase, around 15,000 MW of solar power was fed in. Due to cloudy weather, the Netherlands only experienced a small dip of approximately 100 MW.

    Half Year Report

    Read more about our Half Year Report 2015.

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    news-108 Thu, 28 May 2015 15:08:00 +0200 TenneT successfully issues EUR 1 bn Green Bond https://www.tennet.eu/news/detail/tennet-successfully-issues-eur-1-bn-green-bond/ Market shows keen interest: Green Bond two times oversubscribedTenneT first Dutch non-financial company with EURO Green Bonds issueProgramme could evolve into multi-billion euro green investment opportunity to finance Dutch and German offshore wind projects TenneT Holding B.V. (rated A3/A-) today successfully launched and priced its inaugural Green Bond issue, a EUR1bn dual tranche (6 and 12 year) bond issue, each sized at EUR 500m with coupons of 0.875% and 1.750% respectively with the support of five banks, HSBC Bank plc., ING Bank N.V., Royal Bank of Scotland, Lloyds TSB Bank plc. and Rabobank.
  • Market shows keen interest: Green Bond two times oversubscribed
  • TenneT first Dutch non-financial company with EURO Green Bonds issue
  • Programme could evolve into multi-billion euro green investment opportunity to finance Dutch and German offshore wind projects
  • TenneT Holding B.V. (rated A3/A-) today successfully launched and priced its inaugural Green Bond issue, a EUR1bn dual tranche (6 and 12 year) bond issue, each sized at EUR 500m with coupons of 0.875% and 1.750% respectively with the support of five banks, HSBC Bank plc., ING Bank N.V., Royal Bank of Scotland, Lloyds TSB Bank plc. and Rabobank.

     

    Otto Jager, TenneT’s Chief Financial Officer, said: “Today’s inaugural Green Bond issue demonstrates our commitment to working with our stakeholders to continually improve and innovate in our approach to Corporate Social Responsibility while at the same time achieving attractive long-term financing to support investment in three offshore wind transmission projects in Germany. I expect that this will be the first of a series of Green Bond issues for TenneT.”

    An important investor among the many interested parties that came forward today is the German promotional bank KfW. KfW has very recently announced to build up a EUR 1 bn green bond portfolio to refinance projects that actively contribute to environmental protection and the prevention of climate change. Rita Geyermann, Head of KfW Asset Management states: “TenneT plays a central role in the energy transition process and we highly welcome to participate in this very convincing Green Bond issued under its Green Bond Framework.”

    Investing in green energy

    Today’s announcement relates to the issuance of Green Bonds for investments in the transmission of renewable electricity from offshore wind farms to the onshore electricity grid. The following offshore projects are financed with the proceeds:

    • DolWin1 (commissioning 2015): a 165 km HVDC (high voltage direct current) link with 800 MW capacity.
    • DolWin2 (commissioning 2015): a 135 km HVDC link with 916 MW capacity.
    • DolWin3 (commissioning 2017): a 162 km HVDC link with 900 MW capacity.


    Photo: TenneT's offshore converter platform DolWin beta on transport from Dubai to Europe.

    “Future TenneT Green Bonds could not only be used to finance other sustainable projects of TenneT in Germany, but also for Dutch offshore projects to connect offshore wind farms to the Dutch grid”, Otto Jager adds.

    TenneT’s investments in offshore wind energy projects across the Netherlands and Germany are expected to total EUR 7 to 9 billion over the next 10 years. In the period up to 2019, TenneT is realizing over 7,000 megawatts (MW) of connection capacity for offshore wind farms in the German sector of the North Sea, transmitting electricity equivalent to the annual power consumption of approx. 9 million households. By 2023, the TSO expects to have realized 3,500 MW of connection capacity in the Dutch sector of the North Sea, corresponding to the annual power consumption of over 4 million households.

    Green Bonds Framework

    Earlier (April 2015) TenneT published a Green Bonds Framework which serves as a structure for verifying the sustainability quality (i.e. the social and environmental added value) of the projects to be financed through the issuance of Green Bonds. The Framework was prepared in collaboration with oekom Research AG, who provides a second-party opinion in relation to a potential upcoming Green Bond. It is available on TenneT’s website at GreenBond.

    Additionally TenneT has incorporated into its existing EMTN (Euro Medium Term Note) Programme specific Use of Proceeds provisions designed to be aligned with the Green Bond Principles.

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