E.ON urges for increased grid returns in Germany as first-half core earnings increase.

E.ON, Europe's largest energy grid operator, urged Germany's energy regulator on Wednesday to increase future returns on grid investments, warning that the country might lag in developing its power infrastructure. The company reported an adjusted core profit of 5.5 billion euros ($6.43 billion) for the first half of the year, a 13% year-over-year increase, and maintained its outlook for 2025, expecting adjusted earnings before interest, tax, depreciation, and amortization to range between 9.6 billion and 9.8 billion euros.

"While other countries are establishing targeted regulatory incentives, Germany risks falling behind," said E.ON Chief Executive Leonhard Birnbaum, reaffirming a plan to invest 43 billion euros from 2024 to 2028. "We urge the Federal Network Agency to take the factual arguments of network operators seriously and support the necessary investments for the energy transition, security of supply, and affordability, rather than impede them." Energy grid operators rely on fixed return rates set by regulators and have cautioned that attracting investors will be difficult unless these caps are lifted.

Currently, the German regulator allows pre-tax return rates of 7% on new infrastructure and 5% on existing infrastructure, compared to 7%-9% in other parts of Europe.