EON Boosts Spending by 15% as AI Data Hubs Seek Grid Linkups

(Bloomberg) — EON SE will ramp up investments by 15% this year as the German utility seeks to profit from the energy transition and demand for connections from AI data centers.

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The firm, one of the region’s largest distribution grid operators, plays a key role in helping nations to achieve its climate and renweable power goals. Europe aims to be climate neutral by the middle of the century, an endeavor which requires a massive expansion of power grids so that millions of clean energy plants and new devices can be connected.

Total investments will increase by about €1.1 billion ($1.2 billion) this year to about €8.6 billion, the firm said Wednesday in its earnings report. Most of that will be in networks with the purpose of accelerating the transformation of Europe’s energy system, the firm said.

EON said it sees additional connection requests from the AI driven boom in data centers in the “gigawatt range,” as well as requests by large-scale storage systems with an aggregate capacity of 100 gigawatts.

“We have a number of fundamentals driving the need for more infrastructure — the continued expansion of renewables, batteries, battery factories and then data centers just come on top,” Leonhard Birnbaum said in an interview on Bloomberg Television. “We’re talking about a tripling (of investments) over the past five years.”

However Birnbaum only expects that “10% to 15%, maximum 20%” of the batteries will actually be built, he told reporters. He is in favor of a reservation fee that would be paid back if the facility is built.

The company also slightly increased its 2024 to 2028 investment program from €42 billion to €43 billion. The majority of this investment is in network infrastructure. The plan will be updated early next year at the latest, Chief Financial Officer Nadia Jakobi told analysts on a call. Additions could be as much as €10 billion, according to a presentation.

EON shares rose the most in almost a year before paring gains. They traded up 3.4% at 12:50 p.m. in Frankfurt. They have gained 8% so far in 2025, although that’s still below the gain in the nation’s main DAX index.

Read: What’s at Stake for Energy as Germany Builds a Government: BNEF

Friedrich Merz’s conservative CDU/CSU alliance won 29% of the votes in the recent election. He can take control if he is able to form a coalition with Chancellor Olaf Scholz’s Social Democrats.

Merz has vowed to form a government within the next two months. He pledged in his election campaign to cut taxes, invest in grids and using all available technologies to ensure sufficient energy supplies.

Read: Merz Faces Tough Task to Cut German Power Bills: Energy Daily

Adjusted earnings before interest, taxes, depreciation and amortization fell about 3% to €9 billion in 2024. EON expects this year’s profit to be in a range of €9.6 billion to €9.8 billion.

–With assistance from Lars Paulsson, Kriti Gupta and Tom Mackenzie.

(Updates with CFO comment in quotes in seventh paragraph.)