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E.ON calls for political support as profits keep falling

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Nigel Treblin | Getty Images

Germany's top utility E.ON called for a clear political framework for its loss-making gas- and coal-fired power plants, assets it plans to spin off next year as they can no longer compete with rival solar and wind power.

"Germany continues to lack a clear regulatory mechanism that defines and rewards the role conventional power plants play in ensuring security of supply," E.ON Chief Executive Johannes Teyssen said in a letter to shareholders on Wednesday.

"Without such a mechanism, Germany's energy transition will remain incomplete."

Earnings before interest, tax, depreciation and amortisation (EBITDA) declined by 13 percent to 4.27 billion euros ($4.73 billion) in the first half, mainly impacted by a 29-percent drop in profits at its unit in charge of conventional power generation.


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Investors are looking closely at E.ON, which surprised markets in November by announcing it would spin off its ailing power plants, energy trading and oil and gas activities into a separate unit, Uniper, in 2016.

The jury is still out about whether that plan will work, with analysts rating the stock an average "hold".