VNG AG, a 74.21% subsidiary of EnBW Energie Baden-Württemberg AG (EnBW AG), will today submit to the German Federal Ministry for Economic Affairs and Climate Action an application for stabilisation measures under section 29 of the Energy Security of Supply Act.
The measures are directed at absorbing the currently accumulating significant losses from the replacement procurement of natural gas and at enabling business operations to continue.
Ongoing talks between VNG AG with its shareholders and the Federal Government on options for stabilisation of the company continue in parallel.
Due to unfulfilled supply obligations by upstream suppliers, it has been and continues to be necessary to procure gas quantities at considerably higher prices on the energy markets in order to maintain the ability to reliably supply VNG customers at significantly lower prices. These effects have worsened significantly since August, resulting in considerable losses at VNG AG.
In terms of the value chain and its contribution to the earnings of the EnBW Group, VNG AG with its business areas and subsidiaries is a significant subsidiary of EnBW AG that is fully consolidated in the EnBW consolidated financial statements. The specific impacts of the losses due to unfulfilled supply obligations, and to the stabilisation measures applied for today in consequence, on the financial position, financial performance and cash flows of the EnBW Group depend on the outcomes of the further talks and are therefore not yet able to be reliably estimated.
As the third largest German gas importer and storage operator, the VNG Group is system-relevant for security of supply in Germany and structurally relevant for Saxony and eastern Germany. The VNG Group supplies gas to approximately 400 municipal utilities and industrial operators (2021: approximately 20% of German gas requirements).