Good morning, ladies and gentlemen, and welcome to our campus today, to our annual press conference. We are very late in the reporting season this year, with the benefit that there is a lot of sunshine outside, and we conduct our press conference at the beginning of spring. I would also like to welcome those who have logged in via the stream. Also, a warm welcome to you. Before I pass the floor to our board members, some technical indications and remarks. The questions here in the room will be answered directly, and you can raise your hand. Those colleagues who wish to ask via the stream, it would be nice to enter your name in the chat, and then I will call upon you.
It doesn't make sense to enter the whole question, but just enter your name and that you wish to ask a question, and we will answer the questions in the language that you pose your questions. Feel free to use either English or German. The final remark, it would be nice if there was a question via the virtual room, if you could switch on your cameras so we can all see you in this room and here, and then I pass the floor to Markus Krebber.
Thank you, Steffi. Good morning, ladies and gentlemen. A warm welcome to our annual press conference. We're living in troubled times, and in 2025, the situation has not really improved. The global political tensions are palpable. The situation is very challenging. The development of individual companies seems to almost fade into the background. Therefore, I am all the more pleased to welcome you here on campus and on your screens. Thank you for your attention. RWE can look back on a successful fiscal year, both operationally and financially. Our financial figures are good. We've expanded our portfolio by a further 2 GW. Our new build projects are progressing according to plan, and they are the basis for positive future earnings developments.
In a nutshell, we are in a robust position and well on track, and this is primarily the result of the successful work of our employees, the result of the people who work for RWE and who make RWE what it is. I would therefore like to express my sincere thanks to all colleagues. In 2024, we achieved an adjusted EBITDA of EUR 5.7 billion and an adjusted net income of EUR 2.3 billion. That was more than we had expected at the beginning of 2024. Our electricity production from renewables reached a new record of almost 50 million MW hours. This is an increase of around 8%. Our CO2 emissions have continued to fall significantly by a further 13% year- on- year. This means that our emissions from electricity generation have more than halved since 2018. In 2024, we invested EUR 10 billion net in the expansion of our generation portfolio.
A large portion was invested in offshore wind projects in the North Sea, primarily in the construction of Sophia off the British coast and Thor in Danish waters. In addition, we acquired Vattenfall's Norfolk projects off the East coast of England. They have a planned total capacity of 4.2 GW, and development is already well advanced. With the investment decisions for the North Sea cluster in Germany and Orania Wind in the Netherlands, we have also set the course for the further expansion of wind power in the North Sea. Most importantly, we have brought partners on board: Masdar for our 3 GW projects on Dogger Bank in the UK, and TotalEnergies for Orania Wind and for the German sites located northwest of the island of Borkum. Joint projects that benefit both sides.
While we are spreading further billions of EUR in investments across several shoulders, our partners are also getting a stake in attractive projects. In addition to offshore wind, we have also continued to invest heavily in new onshore wind projects, solar farms, and battery storage facilities. In total, we have almost 150 projects with a combined capacity of 12.5 GW under construction. We will commission the majority of these this year and next, a total of 9 GW. Ladies and gentlemen, our operational and financial performance is strong. The prospects for our business are fundamentally positive. Global demand for electricity is expected to increase significantly, not least due to electrification and artificial intelligence. With our integrated portfolio of renewables, battery storage, and flexible generation, as well as a broad project pipeline of possible new builds, we are well-positioned to respond to this positive market development.
However, we also have to recognize that the investment environment has become more uncertain. Continued high inflation and rising interest rates, constraints in supply chains, geopolitical tensions, possible additional tariffs, and possible adjustments in the direction of energy policy in our core markets, these are risk factors that need to be taken into account when deciding on new investments. Our multi-billion EUR investment in new wind and solar farms, energy storage systems, electrolyzers, and power plants are made over decades and therefore require stable, reliable framework conditions. Given greater uncertainties, it is all the more important that we are even more cautious. This is reflected in stricter risk management for new investments, and we have also raised our return expectations for all of our future projects from an average of 8% to more than 8.5%.
As a result, we project a lower investment volume in the years ahead than we had anticipated in the past. We are currently planning net investments totaling EUR 35 billion for the years of 2025 to 2030. This is EUR 10 billion less than we had previously planned for this period. You all know the figure of EUR 55 billion for investments that we announced two years ago. Now, how does this translate into that? We already invested EUR 10 billion, EUR 45 billion are left, and this has been reduced by EUR 10 billion, and therefore they will total EUR 35 billion from today to 2030. In November, we already announced investment delays in view of increased risks of offshore wind projects in the US and slower than expected ramp-up of the European hydrogen economy. The funds saved will be used for our share buyback program worth EUR 1.5 billion.
This will be completed by the second quarter of 2026. Share buybacks will remain part of our possible capital allocation decisions in the future. Ladies and gentlemen, value- creating growth is the compass for all our investment decisions. Thanks to our large project pipeline, which is broadly diversified in terms of region and technology, we can very precisely select where we allocate our capital. We are therefore reaffirming our earnings targets despite the reduced investment program. In 2027, we want to achieve adjusted earnings per share of around EUR 3 and increase it to EUR 4 per share by 2030. What do we expect for the current year? For 2025, we expect adjusted EBITDA in the range of EUR 4.55 billion to EUR 5.15 billion. We forecast an adjusted net income of between EUR 1.3 billion and EUR 1.8 billion.
This means that our group earnings will not reach the level of the past fiscal year, as expected. This is because we expect income from the short-term optimization of our power plant dispatch and earnings in the trading business to normalize in 2025. In addition, margins from electricity sales should be lower due to lower electricity prices. However, we expect the commissioning of new wind and solar farms, as well as battery storage facilities, to have a positive impact. As announced, we intend to pay a dividend of EUR 1.10 per share for fiscal year 2024. This is EUR 0.10 more than in the previous year. For the current financial year, we plan to increase the dividend by a further EUR 0.10. This means a total of EUR 1.20 per share. With this, I would like to hand over to you, Michael.
Ladies and gentlemen, a warm welcome from my side as well. RWE's business performance in 2024 was strong. Our adjusted EBITDA was higher than what we forecast at the beginning of the year. Adjusted net income also exceeded our expectations. This was partly due to a strong performance in the supply and trading and flexible generation segments. Both segments performed better than expected.
Our continued expansion of renewables also had a positive impact. Overall, however, as expected and announced, we were unable to match the unusually strong earnings registered in the previous year. Let's take a look at the segments in detail. In the offshore wind segment, we achieved adjusted EBITDA of EUR 1.6 billion in 2024. This is 6% less than in the previous year. This expected decrease is due to lower prices than in 2023 for the part of our offshore wind capacity for which we do not have long-term off-take contracts.
In addition, expenses for the repair and maintenance of the plants increased. In the onshore wind and solar segment, we achieved an adjusted EBITDA of EUR 1.5 billion in 2024, and that's an increase of around 20%. This was mainly due to the commissioning of new facilities. In addition, the US business from Con Edison acquired on 1 March 2023 contributed to earnings for the first time for the full year. In the flexible generation segment, we achieved adjusted EBITDA of EUR 1.9 billion. As expected, this was significantly below the previous year. However, we exceeded the forecast from the beginning of the year, and this was mainly due to higher- than- expected income from the short-term optimization of our power plant dispatch. Supply and trading once again posted strong earnings in 2024 with adjusted EBITDA at EUR 680 million.
The performance was better than expected, but as anticipated, there was a significant decrease compared to the exceptional high earnings level of the previous year. Since 2024, we have been managing our lignite-based electricity generation business and our nuclear decommissioning activity on the basis of adjusted cash flow. This business is no longer included in our key earnings figures. Details on this and the outlook for each segment can be found in our annual report. Last year, RWE invested EUR 10 billion net. We forged ahead with expanding our portfolio of renewables and flexible generation. We currently have four offshore wind projects under construction. We are making good progress. At Sophia, our 1.4 GW project in the UK, work to install the foundations began last spring. More than half of the total of 100 foundations are now firmly anchored in the seabed.
Construction work is also in full swing at our Danish offshore wind farm, Thor. The installation of foundations will begin this spring. A few days ago, the first foundations for our German Nordsee cluster project arrived at the base port in Eemshaven. We will also use Eemshaven as a base for the Dutch wind farm, Orania Wind. Offshore construction work will start next year. We are also significantly increasing our capacity in onshore wind, battery storage, and solar, especially in photovoltaics. This is mainly due to expansion in the United States, where we are building large solar farms, often in combination with battery storage systems. Our large-scale batteries in Germany and other European markets are usually operated independently. We have just commissioned one of the largest battery storage systems in Germany at our sites in Hamm and Neurath.
The two battery systems have a combined capacity of 220 MWs and can deliver within seconds. The construction of our large electrolyzer in Lingen is also progressing well. The pilot plant is already in operation. In total, we plan to build 300 MWs of capacity at the site. From 2030, our partner TotalEnergies will purchase around 30,000 metric tons of green hydrogen a year from Lingen and use it to decarbonize its refinery in Leuna. This is the largest green hydrogen purchase agreement in Germany to date, and it shows that the hydrogen economy is making progress. We have set ambitious growth targets, and that means that we need a solid financial position. This is the case at RWE. We have the required financial headroom to fund our multi-billion EUR investment program, dividend payments to our shareholders, and for our share buyback program.
We cover most of our financial needs with our operating cash flows. In 2024, this amounted to EUR 5.9 billion. Thanks to our strong operating cash flows, our net debt was moderate. It amounted to EUR 11.2 billion as of 31 December 2024. Our leverage factor, which reflects the ratio of net debt to adjusted EBITDA, was 2.0 in the year of the review. It remained well below the upper limit of 3.0 that we have set for this key figure.
We also expect to remain below the 3.0 threshold in the current fiscal year. Our good credit rating remains strong. The rating agencies Moody's and Fitch confirmed our solid investment grade rating. We want to increase value for our shareholders and let them participate in the company's success. Thanks to our strong earnings, we are able to pay an attractive dividend, and we want to keep increasing it. We are aiming for an annual increase of our dividend of 5% to 10% through to 2020. With this, I'll hand back to you, Markus.
Thank you, Michael. Ladies and gentlemen, the market fundamentals for power demand are promising. In October, the International Energy Agency published its latest outlook. It expects global electricity demand to almost double by 2050. The main drivers are the further electrification of transport, of buildings for heating and cooling, and of industrial processes. Of course, the growing demand from data centers and AI. To supply the increasing demand for electricity, a combination of renewable storage and flexible gas firepower plants is the right mix. There needs to be a massive amount of additional generation capacity. An attractive and stable environment is crucial as a prerequisite for long-term investments. It's equally crucial to retain industrial competitiveness.
Secure and affordable energy supply is essential to this. It is therefore right that the European Commission and the coalition partners of the future German government are putting competitiveness at the top of their agenda. The European Commission's Clean Industrial Deal and the Action Plan for Affordable Energy now provide guidelines for achieving this goal. The problem of excessive bureaucracy, which undermines our competitiveness, has also been recognized. However, what's still missing is really a mental change. It's not enough to describe the general direction. We need concrete measures, and that quickly. These will be the new German government's more pragmatic power plant strategy will be approved within three months and the central capacity market within 18 months. The overregulated definition of green hydrogen will be abolished. Decarbonization is already taking place via the CO2 trading system. The current requirement for green hydrogen has no impact on climate policy.
Instead, it systematically slows down the ramp-up instead of boosting it and makes this unnecessarily expensive. The review of whether further EU financial market regulation should be applied to energy markets will be discontinued. Why consider tightening up when that would only cause companies to consider relocating to the US or UK? Excessive bureaucracy will be specifically reduced. Sustainability reporting will be scaled back to a reasonable level. The EU supply chain law will be limited for all companies and not just for small and medium-sized enterprises. A true capital markets union with harmonized insolvency laws and a true digital union with harmonized data protection rules will be created. Today's fragmentation prevents investment in the EU. This list of specific examples that provide real relief could be continued. Germany urgently needs a stable and resolute government that is also prepared to take the lead in Europe.
It's good that CDU and CSU and SPD have quickly concluded the Explorer II talks for their coalition. Now it's important to maintain the pace. The new agenda for our country must begin towards economic dynamism. A successful and productive economy is the basis for providing the funds for our defense and the modernization of our infrastructure in the long run. A successful economy will take the wind out of the sails of the political radicals. Affordable energy is a basic requirement for a competitive industry. This is why in Germany, too, greater attention must be paid to security of supply and economic efficiency. In other words, German energy policy needs a fresh start for the coming years. It requires, first, a clear focus on what's necessary in the next few years. What does it mean in concrete terms?
A major driver of energy costs is the cost of grid extension. Grid expansion planning is currently based on maximum demand planning. What we need is a reality check in this respect. Expansion must be dynamically aligned with verifiable factors such as the actual electricity demand. When it comes to hydrogen and CCS infrastructure, we should initially focus the build-out on industrial centers. When it comes to renewables, it is not a matter of achieving previously set gigawatt targets. It's a matter of building where it makes sense. This also applies to offshore wind, where the expansion target of 70 GW should be adjusted downwards. More important than the pure increase in capacity is efficient use of sites so that wind farms do not block each other and can achieve sufficient wind yield. This also saves costs. Most importantly, what we need is security of supply.
I've said it many times, and it's still true. We need competitive tenders for new gas firepower plants, and we need them as soon as possible. Second, we need to look at the system as a whole instead of getting bogged down in isolated individual solutions. Renewables are the cornerstone of the modern energy market. They need to be planned and remunerated more from the perspective of the system as a whole. The best locations are where they cause the least additional costs for the grid and where they provide the highest yields for the system as a whole. This could be managed by means of more transparency. If there was a traffic light system that shows everyone where it makes sense to build based on grid expansion plans and where it does not, we could become considerably more efficient.
It would also be helpful if those who built in areas without sufficient grid capacity were to contribute to the grid connection costs. It is not a good solution that all costs, whether or not they make sense, are imposed on the general public. This is also true for private PV systems with feed-in tariffs. They receive guaranteed remuneration and pay a small contribution to the grid fees. However, they always use the grid precisely when it is already at maximum capacity. Here, too, urgent action is needed. Third, there needs to be more trust in market instruments. Some very specific examples. We should let emissions rate effect and take effect. Any double regulation makes the energy transition more expensive. Why do we need fixed conversion dates from gas firepower plants to hydrogen? This costs money, increases uncertainty, and has no impact on climate policy.
The expansion of renewables might also be market-based. Fixed feed-in tariffs must be abolished. Compensation is no longer justified during hours when electricity prices are negative. Further expansion should be based on more commercialization or long-term supply contracts. If state-organized long-term purchase contracts, CFDs, are used, they should be integrated into the market competitively. There are proposals for this, such as production-independent financial CFDs. First, cost reductions can be achieved by using the grid connection points more efficiently. Why is it not possible in Germany to connect several plants to one grid connection point? It is significantly cheaper overall to do this way than to create a separate grid connection point for each plant. This list could continue.
Together with Eon, we've published a paper in which we have compiled very, very specific proposals for how a fresh start to the energy transition can be made possible at significantly lower costs. [Foreign language] . Dear ladies and gentlemen, to conclude, let me summarize our company's situation once again. Our operational and financial performance is strong. With our portfolio, we are in a robust position to meet the growing demand for electricity. Given major uncertainties, we are increasing our requirements for future investments and therefore expect to invest less than before up to 2030. We will continue to realize attractive projects internationally and, of course, also here in Germany.
Despite the slight reduction in our investment expectations, we confirm our previous long-term earnings and dividend targets. The times are and will remain challenging, and we are very well prepared for this. We are looking forward to your questions.
Thank you very much, Markus. Before we start with the Q&A session, I would like to remind you that if you have joined at a later time, if you are connected through the virtual room, you can ask your question in the virtual room. Simply state your name, enter your name in the chat, and I will call you. Now let us continue with the questions in the room. I cannot see everybody, but I will start with the right side. Daniel Wetzel, Mr. Finke, Ms. Busse, and Ms. Höning. That would be the order. I will move over to the left side of this room. Mr. Krebber, the new risk assessment and the reduced investment in Germany, how much will you invest in Germany? Are you going to change investments for Germany?
No, nothing has changed for Germany as far as the plan is concerned. Of course, this will depend on the auction for new gas-fired power plants. Future investments in Germany that have not been confirmed are hinging on the gas-fired power plants. In Germany, more than 3 GW are being built, and additional offshore wind areas have been secured. The variable that we're faced with are the additional gas-fired power plants that are to be built. Thank you, Markus.
Mr. Finke, please. Good morning. I would like to know what, as far as the forecasts are concerned, you mentioned in your speech that there's a normalized contribution to earnings in the area of power plant generation and supply and trading. What does that mean specifically? Was 2024 a year where these two segments were unnormally profitable or were prices unnormally high? Are they normalizing now? That's my first question.
If you look at the United States and the fact that Donald Trump is not a big fan of offshore wind power, that was already a topic in November, apparently he's not a big fan of solar systems. He called them hell on earth because they look ugly. You're a major solar player in the United States now. Are you concerned that you may have to reduce your expansion plans in solar in the United States?
Now, concerning your first question, from 2022 to 2023, we generated high earnings in flexible generation and energy trading, supply and trading. That was mainly due to the fact that prices were very high at this time and flexible generation stepped in and made the necessary capacity available. However, volatility, you may remember price volatility, volatility was extremely high.
That was a situation that supply and trading used to its benefit and generated high results. What we saw in 2024 and what we are expecting for 2025 is that this situation will normalize. With regard to supply and trading, we guided a range of EUR 100 million-EUR 500 million of earnings. That is the figure that we already mentioned in the previous year. This depends, of course, on prices and how markets will develop at the end of the day. In flexible generation, we are expecting volatility to go down. With regard to gas and electricity prices, they have also gone down. That is why our expectations are below the level of 2024, but will remain at a normalized level. Your question concerning the United States, Mr. Finke, if you look at the market, the electricity demand is developing dynamically.
Electricity demand growth is higher in the United States than anywhere else in developed countries. It is expected that this will continue. Now, if you look at what can be built in addition, what new builds are possible, it will take decades until nuclear can be added. Gas is not that quick either, but renewables is quick. Anything that can be added in terms of capacity is required in order to meet the demand. Now, under Trump 1, Administration 1, the expansion of wind energy, solar power was good. We added a lot of capacity at the time. What can we do? In order to take further investment decisions, we need clarity with regard to customs tariffs. We also need clarity with regard to permits.
I can't give you an answer yet, but we can only make additional investments through the 4 GW that we're currently in construction if we have clarity. Once we have clarity, we will continue to invest. If we do not have clarity, we will not be able to accept this risk. I will only be able to give you an answer at the end of the year.
The next question is from Ms. Busse, from FAZ. I have a question concerning gas-fired power plants. If your requests are realized by the new government, does it make sense to stick with your time schedule? If you win an auction and the first power plants will be able to run in 2030, but if this won't be successful, what does that mean with regard to what does that imply for your coal exit? Thank you, Ms. Busse.
If clarity comes quickly and if the auction will take place at the end of this year, early next year, and if the planning and authorization and permit process is accelerated, which would be necessary, construction by the end of the decade will still be possible. That is because we continued planning our projects. We did not stop because we know that this capacity is needed when we prepared the permits and etc. In our discussions with suppliers, we continued working and moving forward. You will probably have to ask this question to the government. We have a clear regulation and agreement that we will exit coal by 2030. The federal government will still have the possibility to use remaining power plants as reserve capacity. The government will have to decide. It is in the interest of all of us to have clarity. We need renewables also to keep electricity prices down. Thank you very much, Markus.
The next question is from Ms. Höning, Rheinische Post. I have three questions, if I may. Electricity prices depressed your business. What do you expect in this regard? In the paper of the government, the negotiators want the first fusion reactor to be based in Germany. Do you think that's realistic? Would you like to join this business? There is also debate on Nord Stream. If the war ends at some stage, do you think it's realistic that Nord Stream will start operating again? Do we need Russian gas? Ms. Höning, electricity prices have developed as expected. We're not surprised facing the most recent developments. The earnings situation has normalized.
As Michael Müller said, we had very high results in the previous years because of the good situation in energy trading, which, of course, cannot be continued in the future. We are not surprised. The earnings level that we are faced with now is normal. Over time, it will rise because of the investments that we are making. Second question concerning fusion, nuclear fusion. Research and development is a good thing, fundamentally. Now, if we have technologies that can reach a breakthrough, if we are able to solve the energy problem of future generations, you have to make an effort. You should make this effort. We are not doing actively research. We are those who invest at the end when the technology is mature enough for the market. We are observing the situation, but we are not getting involved in research and development.
However, we may get involved if our existing sites can be used for pilot plants. In such a situation, we would be willing to participate. Nord Stream is a political decision at the end of the day. It is not about the economic topics. It is really about ending the war. That always has to be the first step. Anything else is secondary. Regardless of what the political decision will be, I would like to state that we should never be dependent, no matter of whom. We always need alternative import routes. We need an LNG import infrastructure in order to be independent, regardless of where the gas comes from. What site would be suitable for a fusion reactor? You may be familiar with the debates in Hesse, but that is still at a very early stage. We are currently dismantling and decommissioning the existing nuclear power plants according to the Nuclear Energy Act.
Okay, now let me turn to the virtual room. Mrs. Becker, Mrs. Pittel, and Mrs. Eckert have called for the floor. After that, we will hear Mr. Steilz and Mr. Wittkopp. Mrs. Becker, you have the floor.
Good morning, everybody. I have a bunch of questions. The US business first, you got in on that. What does that mean for Con Edison and the value creation of this investment? You mentioned a strict investment management. I would have expected you to be strict anyway when it comes to investment management and risk management. You confirm the earnings situation. You say, in specific terms, earnings per share. That is EUR 9 billion of EBITDA by 2030. Can this be confirmed?
First of all, on Con Edison, at the moment, we do not see any impairment need. When we bought Con Edison, when we bought it, there were 3 GW installed capacity. Now we are disposing of more than 11 GW and more than 4 GW around the construction. You see the dynamic development since we have established the business. This has not so much to do with the purchase proper, but with the dynamic development in the US Of course, we put some capacities in, of course. In practical terms, when you are aware of the fact that approval applications go their normal way, and it is a formal thing to receive the approval, you can start investing. You can start planning without having the approval.
When trade policy is quiet and smooth and there are no customs and tariffs, you can be sure that things can be delivered in a year's time. If the situation changes, the trade policy is volatile. Within the delivery times, customs are raised, which have to be borne by the importer or the exporter. Of course, risk management is still in place. It was in place, but a lot stricter, stating that investment decisions are only taken once the customs risk is mitigated, completed. If the environment is getting more uncertain, the criteria get stricter. Yes, for example, 2027 to 2030, you said that we see a situation that there is a lot of uncertainty on the investment environment.
In the field of offshore, for example, or in the case of flexible generation, we have already decided on the investments for 2027. Thus, the expectations for 2027 can be confirmed. In the field of onshore wind, of course, since the investment cycles are shorter and they also include the US, everything depends on the development of investment conditions. Depending on the development, we will rearrange the capital allocations and will rearrange investments. For 2027, we have communicated the net earnings objectives and the net EBITDA. After that, we will have, of course, to include the uncertainty. As soon as there is more clarity, we will provide more information. At the moment, of course, the situation is completely unclear. Laura Pittel from the Financial Times, you have the floor.
Thank you for the opportunity. I wanted to ask a follow-up question about Russian gas. Mr. Krebber, you said that Germany should never again be so dependent on one market. What does that mean in terms of your view about Germany and Russian gas in future? Do you think it's conceivable that that could happen one day down the line?
Laura, since, let's say, questions around security of supply are always political questions. I mean, the market will not sort it, as we have seen also in the past. This is a political question. What proportion would be acceptable? What price level? What are the conditions? As I said, this economic discussion can only happen after a solution to the active war is in place. It is in the end a political question. I mean, we have no opinion how fast that might happen or not. That is probably for your political correspondence.
Good. Okay, thank you. The next question will be asked by Mrs. Von Reuter.
Hello. Three things. We were talking about dependency. Will there not be a new dependency on American LNG? Also, in terms of the gas market, what is the option of concluding long-term LNG contracts, reducing the dependency on the spot markets, raising its own problems? The British colleagues expect a status quo on the British project, in particular with a view to onshore wind. I think we need to differentiate between where the gas comes from. That is a question of the market, which price is raised where, and what are the alternatives? If I depend on two or one pipelines, then I'm really restricted. If I'm not restricted to these two pipelines, then I can, of course, source gas at a worldwide level.
We need to invest in infrastructures. Some people say, well, it's not fully utilized and we don't need it. No, no, this is wrong. We need it as a fallback position. We discussed that also before the breakout of the war. Long-term contracts, second question. Long-term contracts are a kind of risk management. They don't provide us with a supply guarantee. For example, during the energy crisis, it was not a problem of long-term contracts. We bought into long-term contracts and redirected cargoes. Asia, for example, if they pay higher prices, then this long-term contract goes to Asia. What we need is the infrastructure. This creates the highest degree of independence. This also changes our perspective of how we source gas worldwide. The last question was, are the UK projects?
In the UK, of course, there's a lot of projects under construction, apart from Svea. That is the offshore wind farm, 1.4 GW. Onshore wind, solar, I think more than 1 GW under construction. The major pipeline for more than 4.2 GW. If the conditions for the investments are right, then we can confirm the investment plans. However, when it comes to these major investments, we intend to take partners on board. Okay, let me return to the room here. Mr. Steilz, and then Mr. Wittkopp, and then Mr. Meinke. After that, Mrs. Brändl, Mr. Steilz. [Foreign language] . Thank you very much. I have a few questions, Mr. Krebber. Could you please explain how, talking about tariffs, to what extent would you be affected by tariffs associated with the United States? Could you please elaborate on that?
In your speech, I did not see an assessment of the budget policy in Berlin. How do you assess the budget bazooka? What impact will that have on the energy infrastructure? Is that going to change the game or not? Another question concerning your strategy in detail. What does the global development imply for your global green strategy? Doesn't it have to be adjusted? You've done that, but would it go even a bit further? Would you have to challenge the entire strategy considering what is happening globally? Are you working on that? Can we expect an update on that?
Thank you very much. I'll start with the first question concerning tariffs. Our current program that is being built in the United States, we have 4 GW under construction, is very much immune against tariffs. Even the extreme tariffs would increase costs by a factor of only about 1%. That's why we feel secure as far as these investments are concerned. In future, if we want to invest, we either have the imported goods in the country or the supplier has to pay the tariffs. It's going to become more difficult. That's why we expect fewer investment decisions during this phase of uncertainty. Next topic, it's nice that you missed that, but I didn't want to comment on this topic.
Concerning three aspects. Number one, the challenges that we have as a country are tremendous. Modernizing infrastructure in Germany is a topic that we've been dealing with for many, many years. That doesn't only relate to energy. We have the security situation. Geopolitical certainties that existed are no longer valid. That's the second challenge. I believe that Germany has one big advantage compared to other Western countries. We have very little national debt.
In this situation, we are using the opportunities that we have. That is a good thing. We have to make sure that the money is spent precisely on the problems that were just mentioned, not just because we have money. Any structural reforms and any other topics, of course, will be put on the back burner. We want to use the advantage, not just to, we should use the money that we have to solve the problems and not just have two or three easy years. The third part of the question, energy infrastructure, I do not think too much money is needed from the government because private money is available. The investment framework has to be good. We should not invest government money in areas where we have private money because we need the money for traffic or transport infrastructure, etcetera.
We don't want to replace private investments in the energy infrastructure. Now finally, just to give you a magnitude, the topic to solve the problem of security supply. We're talking about the 25 GW of gas-fired power plants. If you break this down, and we expect that we get a price for providing capacity, a price that is competitive, we expect that these costs will account for less than 3% of total electricity generation costs. We do not need government support for that. This can be done privately. Second topic, strategy. Our general orientation of growing green, which has always been a combination of renewables, battery storage, flexible generation, that's gas, new builds where required, we believe that this is still right. That's the technology mix that will meet the rising demand for electricity. Of course, the weighting may change.
We may move more towards one technology than to another technology. There may be a shift from one region to another. The general orientation is the same. Maybe the piece of the pie will not be that big because we are more risk-averse. There may be shifts, but we can tell you more about that at the end of the year when we know two unknowns, the general thrust of the US policy and the German energy policy. These are two important factors. With this, we will be able to revise our industry mix and specify our technology mix in the future. In general, we need more capacity. It is definitely indispensable and also in the mix required. Mr. Wittkopp is the next person on my list. Mr. Wittkopp, thank you very much. A question to Mr. Krebber.
My colleague just asked the question that I wanted to raise, but let me get more specific. Now, considering the plans for government expenditure of CDU, CSU, and SPD, do you see that there may be a risk of expenses shifting from energy consumers to public households without addressing the structural problems? If you have a lot of money, there's always a risk of taking easy solutions. I would think this money should be used where the government is needed. Now, concerning the energy topic, we submitted a joint paper. You may have read it. It includes a lot of examples. The BCBTD study that was published today has the same general gist and what needs to be done in order to implement the energy transition in a cost-efficient manner.
Now, I believe that the energy-intensive industry that competes with other international companies and that will not benefit from all relief measures will still be able to compete when you have when carbon border adjustments will not work. They will have a problem, sorry. We will have to think of potential relief. The amounts are not excessive. No infrastructure fund, for instance, will have to be utilized. If this money is used for the German industry, it will probably be used for German industry that competes with international companies and that is not competitive. It would not just generally subsidize the German industry. Mr. Meinke from The Adset and Ms. Brändl from Bloomberg. Thank you. I have several smaller questions. Concerning the balance sheet, your net income rose from EUR 1.5 billion to EUR 5.1 billion. Could you explain what the reasons for this were?
Earnings taxes declined from EUR 2.3 billion to EUR 1 billion. Why do you not have to pay as much tax as in the past? In November, there was some discussion. There was a debate concerning Elliott. Are they still active? Is that no longer of interest because of the share buyback program? It was reported that the sales process was initiated concerning the sale of your stake in Amprion. Has this process been started? Do you want to sell your stake in Amprion? What is the value of Amprion in your books? Mr. Meinke, thank you. Let me start with the net income. We always report an adjusted net income. In the balance sheet, you will see, according to IFRS, the difference between these two figures are adjustments. I would like to mention derivatives.
These are temporary differences resulting from accounting principles, which, however, are dissolved when they're realized. These are being adjusted. That's a driver for the positive result. Last year, we also had several impairments on our lignite assets, which did not occur this year. We also had provisions for impending losses on loss-making electricity contracts, which were dissolved this year. These were temporary effects. With regard to taxes, these are deferred taxes. We had made provisions or depreciation, sorry, for capital gains taxes. We also had some appreciation in the United States. These are all accounting matters. The guidance that we give to the capital market is an adjusted tax rate of 20% because we believe that this effective tax rate effectively reflects the taxes that we will pay in the years to come. Now, your question concerning Elliott.
You have to ask Elliott about their own opinion. We would not like to comment on that. With regard to Amprion, I can only repeat what we previously said. Grid expansion requires high investments that concern Amprion. That is why Amprion will need capital. We talked about capital allocation. Of course, we always look at where capital can be allocated properly. It may also make sense to sell our stakes or part of our stake in Amprion in order to release financial means. The current book value of Amprion is EUR 1.3 billion. Thank you very much. [Foreign language] Mrs. Brändl next. Mr. Kurtow, Mrs. Müller-Arnold, and Mr. Büschel, Frau Brändl. Three questions. You addressed your willingness to sell your offshore wind assets.
Some other companies are planning in the same direction, which might have a negative impact on the sale price. My second question is that you communicate your press release on wind turbines and purchase of wind turbines. You mentioned domestic purchase very often. Will this be your priority? Will this be your focus? What kind of impact will this have on the US activities? The CDU's SPD paper stated that power plants could remain in the market in order to reduce power prices. Of course, we did not want to sell everything completely, but wanted to take partners on board because the projects are evolving very positively. If you look at our portfolio, we are planning apart from the things which are already in the pipeline. That is Masdar for English projects and TotalEnergies for German and Dutch projects.
We're planning on Danish projects and another German project where we are in a very far progressed state of taking new partners on board, which we will communicate briefly. There are other projects which are in the pipeline. We are planning those more flexibly. For the NOFO projects, we haven't taken an investment decision. It is clear which partner we'll be taking on board. Really, really, there is not a lot that needs to be done still. An EG Nova domestic, of course, points to the fact that there are no tariff risks. Of course, if you produce in the country, then there's no risk that tariffs have to be paid. Thus, you mitigate the risks of trade policy. The other aspect is, and that was also the basis for the Inflation Reduction Act, which actively incentivized domestic activities, which was partly successful.
It is only fair to point that out. The last question, the reserve capacity, of course. [Foreign language] At first glance, it seems to be a very good idea to keep power plants alive. With a view to the age and the state of the power plants, it is not a good idea. The effect this will have on the political environment is also important. First of all, there is a great incentive to add batteries in the market. Batteries are not just needed to compensate for price peaks, but also to transport electricity in transitional phases. If we took the peaks away on the basis of such ideas, the idea to add batteries without any subsidies in the market would fade. The second effect is that there are installations which are not utilized fully.
If you add reserve power plants, there is an incentive to decommission even more power plants because you get some sort of remuneration for not investing in new capacity. If you wish to enter into long-term supply contracts, of course, you need reserve capacity. There is no incentive to invest in new. I have not addressed the political side, whether this is possible from the regulatory side. It will have major negative impacts on the market developments and renewables developments. Next on the list is Mr. Kurtow, then Mr. Müller-Arnold, Mr. Büschel, and Mrs. Wagner. I would like to ask two questions. First of all, you said that the offshore target for Germany should be lowered. I have not found a figure in your paper. What would be a realistic target figure?
With a view to the EUR 10 billion, yes, I did understand that you cannot specify where you lower investments. It would be good to hear in which segments, that is, be it in storage or hydrogen or power plants, you intend to reduce investments. Have you really deleted some of the investment plans? Have you delayed some investments? These are my questions. Mr. Kurtow, thank you very much. In terms of Kurtow, our proposal is to think about two things. First of all, the expansion goals, the 70 GW, also include the north of England, where the grid connection costs are very high. If you not only look at the generation costs, but also the expansion costs, then this is something from our point of view, which will be delayed and wait for the power development in the future.
Really wait for the demand, which makes sense to build such an infrastructure. Of course, we should go away from the areas for which, for example, there are tenders. We should try to look at the gigawatts needed because then the electricity generation becomes cheaper because we do not have overlaps of different wind farms, for example. Perhaps it's about 50 GW that we need at the end of the day. Second question, EUR 10 billion offshore wind. US offshore wind. I don't think that there will be any major relevant investment this year. We are shifting that to hydrogen. Due to the uncertainties, all the investments will be delayed or will be reduced at the end of the day. That remains to be seen. The new mix that you would like to see is something we can't give you.
This is found in the capital markets information. Of course, we know the path which we will tread upon in the field of the investments. We have already in the firm pipeline. We know that less will be invested. The two major pawns are the US energy policy. If the problems resolve, we will further invest. On the other hand, what is the development in terms of the German gas-fired power plants? After that decision is taken, we can come in on the investments in the future in Germany. Two questions. Of course, questions which erase time and again. One question. A possible reactivation of nuclear power plants, which obviously did not find entry into the coalition negotiations, even though CDU/CSU wanted to get there. Is it dead? Will we have to wait and see what the coalition paper will show?
Secondly, for years, there has been talk about giving away its lignite business. For example, a foundation could be established. Is this idea still alive? What is the idea behind this? Thank you very, very much, Mr. Müller-Arnold. First of all, there was a good laugh about your questions in the room. Of course, these are both political decisions. Let me start with a letter. At the moment, there are no talks about establishing a foundation. The lignite coal will be phased out in the way that has been set out in the regulations. These are the concrete plans. This is our mandate and our task to finalize this job. Should there be any other political decision, we're open for discussions. I do not see any problems raised in this respect. Nuclear energy is a political decision.
We always said technologically a lot of things are possible. Is there a consensus in society? What about the commercial situation? Because each investment needs to be secured in one way or the other. This is why it is the job of the coalition negotiations to really take a decision on that. Thank you. Mr. Büschel, please. Thank you. Three questions. Mr. Krebber, could you just say in simple words what you are planning to do with the EUR 10 billion that you do not intend to invest? Number two, if you are investing EUR 10 billion less by 2030, but still are expecting to generate the same earnings per share figure, how are you going to go about this? Three, Mr. Müller, you said that offshore wind projects are decided until 2027. Does that also apply to the US?
What penalties may have to be paid because you ordered material for wind turbines, etc., which you're not calling off? I think Mr. Müller is the right person to answer these three questions. I'll start with the 10 billion. Our investment program is limited by two things. Number one, do you have attractive projects that can be realized? That's our decision. Number two, keeping our stable investment grade rating as a company. That's why leverage ratios are important to rating agencies. We have to stick within the boundaries. If you invest less, then we will have fewer cash flow from new assets. That means that our room for maneuvering will be smaller. Eventually, we will have less cash flow. We will be able to invest less.
Number two, we also stated that we want to be more cautious with regard to our rating headroom. Currently, considering the volatile and uncertain times, we want to put our balance sheet on a stable footing and want to have lower leverage. A large part of this amount will probably be used for taking up less debt. If the situation changes, we will have the possibility to adjust this again. Number three, the share buyback program that we mentioned, we said that EUR 1.5 billion would also lead to EUR 2 billion less in terms of investments. These are the three drivers. The second question concerning earnings per share. If you invest less, you will have corresponding effects. If you invest less, you have less depreciation. You have a smaller financial result because you take up fewer loans. Fewer adjustments have to be made in general.
We're talking about 2027 and 2030 being the times when we have more clarity. That means that we will make adjustments as soon as we know more. We think that we will have enough room for maneuvering in order to achieve these objectives. That, of course, very much depends on the framework conditions and how they develop in Germany and the United States. Now, question number three, penalty payments. Currently, we only stopped offshore wind projects in the United States. This project was reduced to a minimum. We will still be able to realize the project in the future. We are not investing very much into this project. As far as this project is concerned, we did not have any contracts with suppliers on future deliveries. That's why no penalty fees will have to be paid.
Your maximum leverage ratio of 3 times EBITDA, you're now at 2. Are you going to adjust this target? What is your final objective? 3.5 to 3.0 is the target. Until 2030, we're expecting a target of 3.0. That's the conservative end of this range. We assume that at the end of this year, we will be close to 3.0 due to additional investments. 12.5 GW of projects are in the pipeline and in construction, which these are especially the offshore wind farms mentioned, but also 4.1 GW of onshore projects in the United States, but also battery projects and other projects in Europe. This will, of course, lead to an increase in the leverage factor by the end of this year.
The next person, Ms. Wagner from DPAFX. Mr. Meinke. Thank you very much. This is a question that is probably directed to Mr. Müller. Two questions. Number one, I'd like to talk about the requirements for returns more than 8.5%. What criteria are becoming more important than they have been in the past, that they were in the past? Or are they also regionally? Do they vary regionally? Another question concerning the share buyback program. Did I understand you correctly that you may be interested in going beyond the EUR 2.15 billion? The return of 5.8%, a return needs to be aligned with the risk. Now, what we do with projects currently is that we have different expectations with regard to returns depending on the project.
If you have a solar project in Germany with a very stable regulatory environment, with an offtake agreement with the government, and a low risk-free interest rate in Germany, the return expectations are lower than in the US, where you have more political uncertainty and the interest rate may be higher. These are the things that you have to take into account. Sometimes projects can be realized with less than 8.5% if the risk profile is low. For projects with a higher risk profile, I would charge more. Now, if we raise our expectations with regard to returns, that does not mean that we're not going to do any project that does not exceed 8.5%. We are evaluating each project according to its risks. If you look at the projects in detail, you will see that the US projects are currently being challenged, scrutinized.
It's not that we raised our expectations for returns across the board. We are also more restrictive in the United States when it comes to when investment decisions are taken. We want to have more clarity about the approval process, about the offtake process, about tariffs. We now have higher hurdles when it comes to taking investment decisions. Second question concerning the share buyback program. We are satisfied with it. We think it's the right decision. The share buyback program will end in 2026. We will see how the market develops until then. On the one hand, of course, we have to keep an eye on our share price. We also have to focus on the regulatory frameworks and the expectations for returns concerning our own projects in Europe and the United States. Last question from Mr. Meinke. Otherwise, I do not have anybody on my list.
Mr. Meinke, employment was a topic that we have not covered yet. You mentioned that it is your job to phase out lignite generation. Could you give us an update on the employment situation in the Rhenish lignite mining areas? How many jobs have been cut? How many jobs still need to be reduced? We hear of companies that are cutting jobs. Do you also have efficiency programs? Are you even recruiting new staff? Do you have early retirement programs, etc.? Thank you very much for that question. As you know, we have a clear job reduction plan for lignite. Our core business is a growth business. This is also reflected in our labor figures. We grew in 2023. We also had a net increase in staff of 850 employees at RWE. At the end of the year, we were just over 21,000 employees throughout the group.
Now, as far as lignite is concerned, about 5,800 employees are still employed in the lignite segment. Our plan is to close the individual power plant sites by 2030 gradually. Eventually, we will have 2,000 employees in the segment. I mentioned that the other segments are growth businesses. Nevertheless, due to adjustments in investments and projects, there may also be adjustments in staff levels, for instance, in offshore wind in the United States. These are adjustments that are normal and do not require any further schemes. How many are based at the campus, at the headquarters? We have about 3,500 employees based at the campus site. Thank you very much. Now, I do not see any further questions from the chat. I do not see any questions in the room. Has anybody been forgotten? This is not the case. Thank you very much for your attention.
As always, we're always available for any questions that you may have after this press conference. Please enjoy the rest of the day and have a safe trip home. Thank you very much.