The Dutch government is stepping in again to support TenneT, the state-owned grid operator, with a new supplementary €19 billion bridge loan. This comes after a failed deal to sell TenneT’s German network to Berlin. The loan will help meet rising electricity demand and support grid investments through 2026.

Earlier this year, the Dutch state already loaned €25 billion to TenneT, which is staring down the barrel of significant capital needs due to the expansion of its power infrastructure. The latest loan consists of a €2 billion bridge for 2025 and another €17 billion bridge for 2026, until other solutions are put in place.

Talks between the Netherlands and Germany regarding the sale of TenneT’s German grid collapsed in June due to financial constraints in Berlin. Now, Dutch officials are eyeing private investment as a potential solution to TenneT’s capital needs, either through share sales or an IPO. Investment banks have already been invited to pitch for roles in a potential IPO of the German operations.

The Netherlands began looking to unburden itself from its German TenneT division last year after looming costs attributed to the shift to green energy began to rise. Germany aims to generate 80% of its 2030 power output from renewables like wind and solar energy, and 100% by 2035. This need for high-voltage grid farms and power grids that need to be extended to reach green energy sites and transmit their output call for significant investment in new networks.

As it turns out, those costs were not only too much for the Netherlands but too much for Germany as well. 

“Participation in Tennet Germany by private investors is currently seen as the best way,” to drum up the capital it needs, Dutch Finance Minister Eelco Heinen and Climate Minister Sophie Hermans have said. “This could be done through the private sale of shares or flotation. These options will be discussed in the months ahead.”

By Julianne Geiger for Oilprice.com

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