KfW Development Bank to be New Energy Heavyweight Lender for Germany

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KfW Development Bank to be New Energy Heavyweight Lender for Germany

Triggered by political tensions with Russia, this energy crisis faced by Germany is the biggest among the ones it faced in decades. To cope with this, the state lender company plays an important part. Thus, KfW Development Bank will be the new energy heavyweight lender for Germany.

KFW headquartered in Frankfurt is a German Credit Agency for Reconstruction, Germany. Towards the end of January, the company committed €42.4 billion to support the energy sector of the country. Out of this, 45% of the amount is to fill storage caverns with gas and 19% to replace Russian gas volumes.

The company had provided loans earlier to cover margin calls and invested billions of Euros in credit lines to Uniper UN01.DE, and Securing Energy for Europe GmbH or SEFE (earlier known as Gazprom Germania). The company is bound to promote sustainable development in Germany and in 2021 it provided around €107 billion in funds for the same.

One-third of that fund went to climate and environmental protection. On Friday, 17-02-2023, KFW replaced its present credit line with Uniper to a €16.5 billion ($17.5 billion) facility that runs till 2026. The Finance Ministry in consultation with the Economy Ministry controls KfW. Economy Minister Robert Habeck, co-chairperson and Finance Minister Christian Lindner, chairperson of the Board of Supervisory Directors of the company. Tasks related to the energy sector of Germany are given to Robert Habeck and Christian Linder.

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The company was established in 1948 with the purpose of rebuilding the post-war economy of the country. Soon KfW will become a shareholder in TransnetBW, a high voltage power-grid of (EBKG.DE), Energie Baden Wuerttemberg AG (EnBW). In 2018, KfW purchased a 20% stake in German grid operator 50Hertz owned by ELI.BR in Elia Transmission Belgium (Elia) of Belgium.

To import liquefied natural gas from the German port of Brunsbuettek, the company is planning to take a 50% stake in a planned fixed terminal along with a 40% in Dutch firm Gasunie GSUNI.UL holding, and a 10% in RWE RWEG.DE, Germany. KfW Development Bank to be a new energy heavyweight lender for Germany along with being a stakeholder in many energy firms to support the economy better.

Elliot is a passionate environmentalist and blogger who has dedicated his life to spreading awareness about conservation, green energy, and renewable energy. With a background in environmental science, he has a deep understanding of the issues facing our planet and is committed to educating others on how they can make a difference.

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