Dutch state sells 46% of grid firm Tennet Germany to investors

The Dutch government has sold almost half of Tennet’s German operations to three major investors, reducing the risk that Dutch taxpayers will have to cover the cost of expanding Germany’s electricity grid.

Dutch pension fund manager APG, Norges Bank from Norway, and Singapore’s sovereign wealth fund GIC will together take a 46% stake in Tennet Germany for €9.5 billion, finance minister Eelco Heinen told MPs on Wednesday.

The sale ends years of political debate about how to fund the company, which has required billions of euros in new capital to maintain and expand the German high-voltage network. Parliament strongly opposed the idea of Dutch taxpayers footing the bill.

Heinen said the agreement means the state will almost certainly not need to inject extra money into Tennet Germany. He had already earmarked €7.3 billion for a capital injection, which can now be released. More than €20 billion in standby loans is also unlikely to be fully needed.

Germany is still expected to take a 25% minority stake in the coming months, after earlier talks collapsed.

Tennet Germany has been part of the Dutch state-owned grid operator since 2010. Both the Netherlands and Germany face major investment needs to strengthen their electricity networks, but as long as the Dutch state was the sole shareholder, it risked being liable for at least €65 billion in German infrastructure spending.