RWE Slashes Green Spending by €10 Billion as US Risks Grow

(Bloomberg) -- German energy company RWE AG will cut €10 billion ($10.9 billion) from its planned investment on green technologies by the end of the decade as its projects face higher investment risks, particularly in the US.

RWE now expects €35 billion in net new spending from 2025 to 2030. The company is responding to regulatory uncertainties, constraints in the supply chain, geopolitical risks and higher interest rates, which have raised the required rate of return for new projects, it said in a statement Thursday. 

RWE is one of the biggest renewable energy companies in the US since completing its acquisition of Con Edison in 2023. Late last year, it warned it may have to delay global green investments given that risks to such projects in the US have increased after President Donald Trump’s election. 

It opted instead for a €1.5 billion buyback, and signaled in its annual report published Thursday that it was keeping the option open for further share purchases.

The utility said the remaining investment funds will be used “primarily” for wind power, solar and battery projects in Europe and the US, with €7 billion to be spent this year, down from €10 billion in 2024.

RWE shares dropped as much as 4.6% in Frankfurt, the most since early November. Citigroup Inc. said in a note that a lower 2025 earnings outlook could be seen as “slightly negative.”

The company expects adjusted earnings before interest, taxes, depreciation and amortization in the range of €4.55 billion to €5.15 billion for this year. In fiscal 2024, the company reached the upper end of its forecast range with earnings of €5.7 billion. 

This month, RWE announced it was letting go of offshore wind employees in the US — a sector Trump has been particularly critical of, halting the sale of new leases and project permitting on his first day in office. For now, the company said it plans to continue all three of its US-based offshore wind projects if the framework conditions allow it, but that it’s keeping spending for these projects at a minimum.

Regarding solar, “we can only make future investment decisions when we have clarity on tariffs and permits,” Chief Executive Officer Markus Krebber told journalists on a call. By the end of the year, RWE should have more clarity on the political direction of energy policy in the US and Germany, he said.

German lawmakers have recently passed a landmark spending package this that will unlock €500 billions in infrastructure spending. “Little state money is needed for energy infrastructure, private money is available,” Krebber said.

(Updates with CEO comment in ninth paragraph.)

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