* Innogy seeks share of 10-15 pct in group profit mid-term
* Sees double-digit pct growth in operating earnings in 2015
* Aims to decide on Galloper, Nordsee One by end-2014
(Adds details on Britain, offshore projects, quotes)
By Christoph Steitz and Tom Käckenhoff
ESSEN, Germany, July 17 RWE Innogy, the
renewables arm of RWE, expects profits to grow
strongly over the next two years and is interested in investing
in Britain even though the company abandoned a major windfarm
project there last year.
"We see our share of RWE's total operating profit standing
at about 10-15 percent in the mid-term, this corresponds with
the planned level of investment," Hans Buenting, chief executive
of RWE Innogy, told Reuters in an interview.
A latecomer to renewables, RWE's green business is much
smaller than at larger peer E.ON, where renewables
accounted for 15.4 percent of last year's core earnings.
Innogy, which plans to invest 1 billion euros ($1.35
billion)($1.35 billion) in 2014-2016, had operating earnings of
about 200 million euros last year, accounting for less than 4
percent of the RWE group total.
Buenting said RWE Innogy's operating profit is forecast to
grow in the double-digit percentage range next year, with at
least single-digit growth in 2016, but growth would be lower
He said the big jump in earnings next year was primarily due
to the fact that offshore wind parks Gwynt y Mor and Nordsee Ost
-- built in Liverpool bay and the German North Sea, respectively
-- will be connected to the grid and start to deliver profits.
"We're now reaping what we have sown in the first six
years," Buenting said.
Innogy was set up by RWE in 2008, responding to the growing
importance of renewable energy while its traditional business of
selling electricity from coal and gas plants has come under
intense pressure. This is due to weak energy demand across
Europe and record low wholesale prices, the result of a major
expansion in solar capacity in Germany.
Overall, RWE owns 3.5 gigawatt (GW) of renewable capacity,
accounting for about 7 percent of its generation capacity. Two
thirds of that consists of onshore and offshore wind power, with
hydro power representing more than a fifth.
BRITAIN IS ATTRACTIVE
Britain and Germany are RWE's two biggest renewable markets,
accounting for more than three quarters of its renewable
But last November, uncertainty in Britain over energy policy
led RWE to scrap plans to build Atlantic Array, potentially the
world's largest wind farm.
RWE said at the time the Atlantic Array project off
southwest England, which would have featured up to 240 wind
turbines and powered as many as 900,000 British homes, no longer
made economic sense in current market conditions.
RWE's decision had followed political wrangling over green
energy policies in Britain, where energy companies have come
under pressure over rising household energy bills. This has
created uncertainty for potential investors in renewables.
British utility SSE said in March it would no longer
invest in the 340 megawatt (MW) Galloper project off the coast
of Suffolk, in eastern England which is a 50:50 partnership with
But Buenting said he was working with SSE to find a new
partner, hoping to make an investment decision for the project
by the end of the year.
"The British market is attractive," he said.
Innogy is also in talks with investors about the first phase
of its planned Nordsee One offshore wind park in the North Sea,
comprising 325 MW and entailing 1.2-1.3 billion euros of
investment, Buenting said, adding he hoped to make a decision at
the end of the year.
If that were to happen, construction of the first phase --
in which RWE would likely own not more than a quarter -- would
start in 2016, he said.
($1 = 0.7394 Euros)
(Additional reporting by Vera Eckert. Editing by Jane Merriman)