Subsea cable Norway / Germany: Cooperation agreement concluded on large-scale project

Frankfurt (ots) -

- Cooperation agreement between Statnett, KfW and TenneT TSO GmbH
to develop, construct and operate a 1400 MW subsea cable between
Norway and Germany
- Investment volume totalling approx. EUR 1.5 - 2 billion, planned
commissioning in 2018
- Climate protection: Supports the expansion targets for renewable
energy
- Coupling the markets results in more stable and lower energy
prices for both industry and consumers

The Norwegian power grid operator Statnett, KfW IPEX-Bank on
behalf of KfW and TenneT TSO GmbH, transmission system operator for
the German North Sea region, have concluded a cooperation agreement
to develop and construct a subsea cable between Germany and Norway.
The high voltage direct current interconnector will enable energy to
flow between Germany and Norway and help improve the distribution of
in particular renewable energy sources between the two nations. It
thereby contributes to the success of the German energy turnaround.
The integration of the Norwegian and German electricity markets,
which thus far are not connected directly, will ensure greater grid
stability in the two countries, increase market efficiency, and
stabilize prices between seasons.

The interconnector project comprises an investment volume of
approximately EUR 1.5 - 2 billion. The three-party agreement provides
for a 50:50 partnership between Norway and Germany. Norway's
state-owned Statnett will own 50 per cent of the project. On the
German side, KfW and TenneT will jointly own 50 per cent of the
project via a newly established project company. The target is to
commence operation of the cable late 2018. The agreement is based on
the agreement reached in June between Norway and Germany. The
agreement comprises provisions on the further development and
implementation of the project; these will result in a final
investment decision in 2014.

Quote Statnett

"This is an important milestone for Statnett, for Norway, and
indeed for Europe. The interconnector will enhance our domestic
security of supply during dry and cold winters, and will also incite
more stable energy prices throughout the year. The cable will
contribute to greater efficiency in the Northern European power
market and to increased production of renewable energy in Europe. But
first and foremost, the realization of an interconnector between
Norway and Germany represents a major leap towards a more integrated
European market, something that will be to the benefit of all
customers, said Auke Lont, CEO of Statnett.

Quote KfW IPEX-Bank

"Through key projects such as this one the energy policy rethink
is taking concrete shape. Our financing of the submarine cable
through this joint effort with Statnett and TenneT has created an
additional foundation for the sustainable transformation of the
German energy mix, in this way contributing to energy supply security
and stable electricity prices," said Harald D. Zenke, Speaker of the
Management Board of KfW IPEX-Bank.

Quote TenneT

"We have been preparing this subsea interconnector between Norway
and Germany for two years. It is a good development for the
integration of wind power and a vital contribution to the German
Energy transition. We are pleased with the participation of the
German KfW IPEX-Bank. Statnett, KfW and TenneT combine the innovative
power, financial solidity and technical leadership needed for a
project of this scale", said Martin Fuchs, Chairman of the Board of
TenneT TSO GmbH.

Alongside the grid expansion in Germany, one of the greatest
challenges in the transition to a carbonfree energy supply is the
creation of storage capacities for intermittent energy.

With this cable wind power and solar power can be exported from
Germany to Norway when there is a surplus of this, while Norway can
export hydropower to Germany when the sun does not shine and the wind
does not blow. This again will support the ambitions for more
renewable energy and increased energy supply in the region, and thus
EU's climate and energy goals, both on a short and long term.

About Statnett

Statnett is responsible for developing and operating the Norwegian
power grid to ensure that it meets society's expectations for the
energy sector at all times. Statnett's main objectives are to develop
the next generation main grid, to maintain security of supply,
contribute to value creation and facilitate better climate solutions.
Statnett is involved in operating and developing interconnectors
between Norway and several other European countries, amongst them the
world's longest subsea cable, NorNed. State owned Statnett has 950
employees and an operating profit of 1,5 bn NOK in 2011.

About KfW IPEX-Bank GmbH

Within KfW Bankengruppe KfW IPEX-Bank is in charge of
international project and export finance. It is responsible for
providing financing to support the German and European economy, a
task derived from the legal mandate assigned to KfW Bankengruppe. Its
prime focus is on medium- and long-term lending to boost the export
economy, develop economic and social infrastructure and support
environmental and climate protection projects. KfW IPEX-Bank operates
as a legally independent group subsidiary and plays a major role in
fulfilling the promotional mission of KfW Bankengruppe. It has 531
employees (as of 31 December 2011) and is represented in the key
economic and financial centres throughout the globe.

About TenneT

TenneT is a leading electricity grid operator in the Netherlands
and a substantial part of Germany, through its subsidiary TenneT TSO
GmbH. With over 20,000 kilometres of high voltage lines and 36
million end users, it ranks among Europe's top 5 electricity
transmission system operators. Our focal point is the development of
a Northwest-European energy market and the integration of renewable
energy. State-owned TenneT is also involved in subsea interconnectors
between The Netherlands and Norway (2008 NorNed) and between The
Netherlands and the UK (2011 BritNed).

Pressekontakt:
KfW, Palmengartenstraße 5-9, 60325 Frankfurt
Kommunikation (KOM), Thomas Krick,
Tel. 069 7431 8454, Fax: 069 7431-3266,
E-Mail: thomas.krick@kfw.de, Internet: www.kfw.de/newsroom

Press Contact Statnett,
Christer Gilje,
Phone: +47 2390 4249; E-Mail: christer.gilje@statnett.no

Press Contact TenneT TSO GmbH
Ulrike Hörchens,
Phone: +49 (0)921 50740 4045,
E-Mail: ulrike Hoerchens@tennet.eu

Harald Wouters,
Phone: +31(0)26 3732600,
E-Mail: harald.wouters@tennet.eu
www.tennet.eu