Japan's Mitsubishi to invest in German green energy grid

Japan's industrial conglomerate Mitsubishi will buy a stake in a joint venture set up to connect German offshore wind farms to the electricity grid. The deal is a sign of mounting foreign interest in German green energy. Mitsubishi Corporation's financial investment division would buy a 49-percent stake in the joint venture, with 51 percent to be held by German-Dutch grid operator Tennet, German newspaper "Frankfurter Allgemeine Zeitung" reported Wednesday. Mitsubishi would invest 576 million euros ($765 million) in building four underwater connections to German offshore wind farms in the North Sea, Tennet Chief Executive Lex Hartmann told the newspaper, adding that relevant contracts were signed in Japan on Tuesday. "Mitsubishi's participation is a first step, and a strong signal that we'll succeed in finding more capital partners," Hartmann said, as he estimated total building costs for the connections to come in at 2.9 billion euros, with some 60 percent of that amount to be financed through credits. Offshore wind farms are a key element in Germany's drive to put energy production on a more sustainable footing. In 2012, new solar power installations, for example, hit a record high as capacity grew by 7.6 gigawatts. However, government plans to boost offshore wind power to 12 gigawatts over the next 10 years appear elusive in the face of mounting bottlenecks in the German electricity grid. Therefore, recent legislation has made consumers pay more for electricity to finance green energy developments, which appears to be raising the interest of big financial investors. Despite better investment conditions, Tennet CEO Hartmann said he was skeptical about the government's expansion plans for offshore wind power. Many in the sector regarded an increase of 7 gigawatts in the next decade more realistic than the government's target of 12 gigawatts, he told Frankfurter Allgemeine Zeitung.