Capital expenditure

The RWE Group spent € 13,147 million in capital, almost four times as much as in the same period last year (€ 3,426 million). Capital expenditure on financial assets rose considerably. It totalled € 9,446 million, growing more than ten-fold. This was mainly due to the acquisition of Dutch-based energy utility Essent, which we bought on September 30, 2009, together with the stake in swb that has since been sold on. Including other transaction costs, the acquisition costs amounted to € 7,794 million. In addition, RWE Energy concluded three sizeable transactions. € 800 million were invested in the acquisition of the 20 % stake in the regional company RWE Westfalen-Weser-Ems from the company’s municipal shareholders. An additional € 188 million was used by the division to purchase the remaining shares in a joint venture that owns 19.8 % of the new Luxemburg-based energy utility ENOVOS (see the report on the first quarter of 2009). Moreover, RWE Energy acquired the German energy service provider FAVORIT from ExxonMobil (€ 143 million).

Capital expenditure on property, plant and equipment also grew substantially. The RWE Group spent € 3,701 million in this area, 47 % more than in the same period of 2008. All of the divisions recorded an increase. More than one third of capital spent on property, plant and equipment was attributable to RWE Power. The most important projects in this division are a 2,100-MW dual-block lignite-fired power station in Neurath, a 1,530-MW dual-block hard coal-fired power plant in Hamm, a 1,560-MW hard coal twin unit facility in Eemshaven, Netherlands, and an 875-MW combined-cycle gas turbine power station in Lingen. These generation units are under construction. RWE Innogy aims to expand its renewable generation base significantly and is making good progress. The division invested twice as much as a year ago. Centre stage is taken by wind power projects, including the construction of the 90-MW Rhyl Flats wind farm off the coast of Wales, which we intend to complete this year. RWE Innogy commissioned a 60-MW onshore wind farm in the southeast of England (Little Cheyne Court) in July and a second one, with an installed capacity of 41 MW, in the northeast of Poland (Suwalki) in October. RWE Dea largely invests in the development of existing discoveries in preparation for production. In July, the company also acquired stakes in two undeveloped gas fields off the coast of the UK North Sea. RWE Energy’s primary focus is on measures to maintain and improve grid infrastructure. Additional funds are earmarked to expand gas storage capacity. RWE npower is building two combined-cycle gas turbine power stations, one at Staythorpe and another at Pembroke, with installed capacities of 1,650 MW and 2,000 MW, respectively.