The energy industry is undergoing a change. The traditional business model of most energy suppliers has been severely affected by the tightened market conditions, changes in the regulatory framework and the technological progress. The transformation of the sector is observable in various financial aspects and in particular in the increased transaction activities.
Energy supply is becoming increasingly decentralized and complex. Energy supply companies are meeting these challenges by driving innovation through digitization. The primary aim of digitization efforts is to establish fast, efficient, and automated processes. The energy sector is intensively addressing the topics of Internet of Things, breaking down industry boundaries and increasing innovation through cultural change. An example of this is the founding of Evolution AG by 6 utility companies.
The investment priorities of energy supply companies and the targeted decarbonization lead to a concentrated demand for renewable energy projects. This situation is intensified by the lively investment activities of financial investors. Due to the limited investment opportunities and the small number of attractive projects, domestic prices are rising sharply. Accordingly, a large amount of funds continues to flow into investment projects abroad.
With the amendment of the Electricity Supply Act, the Federal Council wants to open the electricity market for all customers and, by revising the Energy Act, further improve the investment incentives for renewable energies and secure the supply of electricity. The federal government is currently developing a long-term climate strategy to achieve the climate target for 2050 (net emission reduction to zero), which should also consider the role of negative emission technologies. The gas sector is to receive legal regulation in the Gas Supply Act, which provides for partial market opening.
In June 2020, the three majority shareholders Schweizerische Kraftwerkbeteiligungs-AG, EOS Holding SA and the consortium of Swiss minority shareholders achieved a 90.41% stake in Alpiq Holding AG. Thus, the conditions for a squeeze-out merger were fulfilled and the merger was successfully completed after approval by the Annual General Meeting. Two shareholders have each filed compensation review proceedings against the squeeze-out merger.
Confirming the trend towards innovation and digitization, in October 2020 BKW acquired Sigren Engineering AG, based in Winterthur. Sigren Engineering is a leading actor in the growth areas of smart buildings and smart infrastructure. Through the acquisition, BKW Building Solutions strengthens its expertise in the automation of buildings and infrastructure.
In August 2020, ewz took over the Stigafjellet wind farm built in Norway by the Swedish energy company Eolus Vind. With a total capacity of 30 megawatts, the wind farm achieves an annual production of 117 GWh of electricity, enabling ewz to increase its production from wind power by 20%.
IFBC was mandated by ewl to develop a long-term simulation tool for the measuring of financial impacts on ewl’s decarbonization strategy. The model considers the main sales and cost drivers of the several business units, enables a consolidated overall view and is focused on the specific business characteristics of ewl.
ewl is the municipal utility company for electricity, gas, water, district heating, telecom services as well as energy and installation services of the city of Lucerne.
IFBC supported Energie Ausserschwyz AG as exclusive financial advisor and guided the company through the entire financing process. The company signed a loan agreement (amount CHFm 60) with a Swiss bank and raised additional equity from a strategic partner.
With the realisation of the district heating project, which involves the construction of a wood-fired combined heat and power plant, a biogas plant and a district heating network, Energie Ausserschwyz AG will in the future supply the population of the Canton of Schwyz with environmentally friendly heat and electricity. Energie Ausserschwyz AG is thus making a significant contribution to the switch to more ecologically energy sources.
IFBC was engaged as financial advisor with focus on the identification and valuation of services and ancillary services with regard to compliance with the applicable price rules under Swiss takeover law. The results were reported in the form of an expert opinion and reviewed and assessed by the review body of the transaction.
CSA Energy Infrastructure Switzerland is an investment group of Credit Suisse Investment Foundation.
IFBC examined the feasibility of financing of planned investments and assessed the debt situation of Eniwa. In addition, potential financing options for Eniwa were identified and evaluated.
Eniwa is a regional energy service company headquartered in Buchs AG. As a municipal utility, Eniwa is majority-owned by the city of Aarau. Eniwa offers supply and installation services for private households and companies in the region.