Structural solutions for financing TenneT
The government is going to issue a guarantee to TenneT Nederland. This will enable the high-voltage grid operator to continue investing in the Dutch electricity network through attractive loans. Two options are being considered for the financing of the German branch of TenneT: a private share issue or an initial public offering. This will provide structural solutions for the financing needs of TenneT Netherlands and Germany, as ministers Heinen (Finance) and Hermans (Climate and Green Growth) write in a letter to the Parliament. All financial aspects have been incorporated into the Spring Budget.
A well-functioning transmission grid and access to electricity are essential for Dutch households and businesses. Expansion and reinforcement of the electricity grid are necessary to meet the growing demand. This requires major investments; TenneT Netherlands is expected to invest some 90 billion euros over the next ten years. The government has decided to issue a guarantee to ensure that TenneT Netherlands can finance this investment. This will enable TenneT Netherlands to take out loans with the same credit rating as the Dutch state (AAA). This means that loans can be obtained on the capital market under better conditions – and therefore more cheaply. This approach means that no additional capital contributions from the state are necessary. The intention to provide a guarantee is included in the Spring Budget 2025. This will be submitted to parliament.
For TenneT Germany, where substantial investments are also needed in the coming years, the government has chosen private funding. An initial public offering or private share issuance are the two options currently under consideration. Interest among private investors will be explored in the coming months and a decision will be made before the summer which option implemented further.
The proposed structural solutions changes TenneT’s financing structure. At the moment, TenneT raises its debt through TenneT Holding and lends it to TenneT Netherlands and TenneT Germany. In the future, the debt will be raised separately by TenneT Netherlands and TenneT Germany. All existing bondholders will be asked to agree to the transfer of the debt to TenneT Netherlands in exchange for a one-time compensation. In doing so, TenneT is working on a future-proof financing structure. If there is insufficient interest among private investors in participating in TenneT Germany or the debt restructuring does not succeed, the Dutch state will itself provide the capital needed by TenneT Germany. A reservation has therefore been included in the national budget. The Dutch state is hereby acting as a responsible shareholder.
Originally published at https://www.government.nl/latest/news/2025/04/17/structural-solutions-for-financing-tennet
