TenneT is supporting the possibility of Germany taking a minority stake in the organization.
In a letter to the Dutch Lower House of Parliament, Finance Minister Wopke Bastiaan Hoekstra presented his preferred scenario for meeting TenneT’s capital requirement as a result of rising investments, due to the energy transition, and low-interest rates.
Germany’s participation in the transmission system operator is the government’s preferred scenario, which brought to the conclusion that a minority stake in TenneT Holding or TenneT Germany will be worked out.
The government believes this scenario fits best within the formulated political objectives and preconditions.
The objectives are holding on to the advantages of TenneT’s cross border steering and lowering the financial risks for the Netherlands that the German operations involve.
The two governments have also signed a Joint Declaration of Intent (JDI) to stress the mutual political interests.
The agreement includes arrangements to expand collaboration on energy and to continue exploring whether Germany’s participation in TenneT is an option, bearing in mind that each party will only contribute equity to finance the company’s investments in its own country.
Both countries have agreed to hold exclusive talks and negotiations in the coming months to work out the details.
“TenneT knows that the energy transition will be more successful and efficient if we stop limiting our thinking to national boundaries and create yet more space for (international) collaboration and innovation,” the TSO wrote.
“In fact, if the two governments, who will perhaps both soon be shareholders in a single, cross border and integrated TenneT, work more intensely together, the energy transition in Northwest Europe could prove cost efficient.”
Because the process is complex and uncertain, TenneT will issue Green Hybrid Bonds before the end of the year, of which 50% will be regarded as equity, to ensure that its good credit rating is guaranteed for 2021.
The parties plan to have an outline agreement before the end of 2020.