BERLIN (Reuters) — German utility EnBW said on Tuesday it would speed up cost-cutting measures to save an extra 250 million euros (US$280 million) by 2020, as it grapples with falling electricity prices and the cost of exiting nuclear power.
EnBW and bigger rivals E.ON and RWE have taken massive writedowns on their power plants, most of which only run a fraction of the time required to be profitable as they are edged out of the market by solar and wind power.
Citing a "renewed deterioration" in conditions, EnBW Chief Executive Frank Mastiaux said additional measures were necessary in order to speed up the restructuring of its sales division.
EnBW said it would withdraw from the business of selling electricity and gas to large industrial customers as it was unprofitable and did not offer sufficient growth prospects.
The measure will affect around 400 jobs, with employees offered voluntary severance packages or an alternative job within the group, it added.
Additional cost-saving measures are planned in the utility's private customer business, generation and trading and administrative functions in coming months, EnBW said, without giving details on the number of jobs affected.
EnBW, which currently employs around 20,000 people, has already cut around 1,650 jobs in the past two years.
The aim to save an extra 250 million euros by 2020 is in addition to an original target of 400 million euros.
The company also confirmed its 2020 targets for earnings, its credit standing and return on capital employed.
© Copyright Canadian HR Reporter, Thomson Reuters Canada Limited. All rights reserved.