In the first half year of 2021 TenneT, as a major enabler of the energy transition, was once again able to maintain a high security of supply of 99.99 percent for its 42 million Dutch and German end users. At the same time, higher European and national political targets to reduce CO2 emissions, a need for consensus among European countries on a clear, legal and regulatory European roadmap and the often complex integration of renewable energy solutions and corresponding new infrastructure into our living environment increase TenneT's efforts.
Manon van Beek, CEO: "As Europe's first cross-border TSO with expected annual investments to grow to EUR 5-6 billion, TenneT aims to achieve a timely delivery of onshore and offshore extensions and investments. Our energy system is undergoing a revolutionary development in which the high voltage electricity grids - the backbone of the energy system - are being used in a completely different way. Once built to meet the demand for energy, now it is changing into a multifunctional connector of electricity supply, demand and storage."
TenneT’s financial performance in the first half year of 2021 remained solid. Underlying revenue of EUR 2,568 million increased by 10.7% compared to 2020 (EUR 2,319 million), mainly driven by a growing asset base and additional compensation for grid-related expenses. Underlying EBIT increased by EUR 17 million to EUR 431 million in the first half of 2021 (first half 2020: EUR 414 million).
Key underlying results1
|EUR Million||30 June 2021||30 June 2020|
1 Contrary to IFRS, ‘underlying’ figures recognize 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.
In May 2021, S&P and Moody’s confirmed TenneT’ s A- / A3 long-term unsecured credit ratings, with a stable outlook. In the same month TenneT went green again by successfully issuing its largest ever (EUR 1.8 billion) and first green triple tranche Eurobond transaction underlining its solid financial position and reinforcing TenneT's top-3 status as corporate issuer of sustainable, green debt financing in Europe, with currently over EUR 12 billion of green debt issued across different debt formats.
Otto Jager, CFO, commented: “The market, yet again, showed keen interest in our green investment offer. Our good credit rating with a stable outlook and our solid financial performance over a long period of time also give us excellent access to all capital markets."
Key Results First Half Year of 2021
High capacity connections to transport green electricity
TenneT is showing very good progress on a large number of projects. Several thousand kilometers of new connections came and will come into operation in 2021, are under construction or are in the planning phase. Flagship project NordLink, the 1,400 MW subsea DC cable between Germany and Norway, is now fully in operation. For the first time, the electricity markets of both countries are directly connected, ensuring the exchange of large amounts of sustainable power and additional security of electricity supply.
TenneT's two largest onshore DC corridor projects SuedLink and SuedOstLink will be built completely underground and are crucial to transport northern wind production to meet demand for electricity in southern Germany. For SuedOstLink the orders for the converters were placed. For SuedLink partnering transmission system operators TenneT and TransnetBW welcomed the completion of the federal spacial planning. With this procedure, the Federal Network Agency ('Bundesnetzagentur') has made the almost 700-kilometer corridor of SuedLink binding.
In the Netherlands TenneT connected wind farm Fryslân, which is the largest wind farm on an inland waterway in the world. A 55 kilometer long underground cable was used to connect the wind farm to the electricity grid. This is the longest underground high-voltage (110 kV) cable connection in the Netherlands.
In April, crucial parts of the new high-voltage (380 kV) connection between Borssele and Rilland were installed. This power highway is essential for transporting the electricity of the existing and future wind farms in the North Sea in the southwest of the Netherlands. In addition, the new connection is important for the exchange of electricity with Belgium. The connection will be commissioned in 2023.
According to planning the second jacket of TenneT's offshore transformer platform for the wind farm Hollandse Kust (zuid) has been installed. TenneT is realizing 3.5 GW of offshore grid connections for wind farms at the Dutch North Sea until 2023 using the same type of 700 MW transformer platform five times. This enables TenneT to build these projects more efficiently, faster and more affordable. Until 2030, TenneT is building 11.6 GW of offshore connection capacity for large offshore wind farms in the Netherlands.
In Germany, that will be 16.7 GW, according to plan. In both countries use will be made of innovative 2 GW direct current connection systems, developed by TenneT together with suppliers and offshore wind farm developers.
Paving the path for necessary system integration
Integrated system planning, cooperation across borders, offshore and onshore, electrons and molecules. All are needed to meet the requirements of a new, smart and affordable energy system to be built between 2030 and 2050. That is why TenneT, Gasunie and the Dutch DSOs published the so-called II3050 (Infrastructure Outlook 30-50) in April. Some of the important conclusions: the infrastructure for electricity must be expanded on a large scale, a nationwide hydrogen transport pipeline network is needed, infrastructure for heat and CO2 must be constructed and more speed is needed since the current lead times for adjustments in the grid lead to bottlenecks. The fact that the Dutch government announced to come up with a plan to adapt existing natural gas transmission pipelines for the transport of hydrogen ('hydrogen backbone') is a direct and gratifying result of the insights presented in the II3050.
Elections and energy policy
The formation of a new Dutch government and the German Bundestag elections later this year provide an excellent opportunity to make political choices based on social considerations. This concerns pressing matters such as costs, space requirements and feasibility. Clear roadmaps are needed for increased climate ambitions. Cooperation between governments, infrastructure companies and industry is of utmost importance.
Find the Half Year Report 2021 here.