The Flemish government has announced a €1.56 billion allocation, through its investment arm, PMV, to strengthen the electricity network.
The investment aims to allow network operator Fluvius to finance essential upgrades.
Fluvius had considered seeking private investors, but the Flemish government opted to keep the network public, according to a joint press release by Minister-President Matthias Diependaele (N-VA) and Deputy Ministers-President Melissa Depraetere (Vooruit), Hilde Crevits (CD&V), and Ben Weyts (N-VA).
'Flanders must remain in control of its network infrastructure'
Fluvius CEO Frank Vanbrabant had highlighted the network’s urgent funding needs in June, warning that major investments might lead to higher tariffs or require private investment, options immediately dismissed by Energy Minister Melissa Depraetere.
Without additional capital, Fluvius risked having its credit rating downgraded by Moody’s, potentially increasing borrowing costs and having a negative impact on Flemish energy bills.
The Government of Flanders thus decided to invest in Fluvius, which is owned by the region’s muncipalities. It is not yet clear exactly how the Government will pursue the financial operation.
"Fluvius will remain in Flemish hands. We will not make the same mistake we made in the past with Engie," Energy Minister Depraetere stressed. "The French multinational is now making huge profits at the expense of the Flemish people, who are paying through their noses for energy."
"Flanders must remain in control of its network infrastructure," she added. "Only in this way can we strengthen our infrastructure and protect the purchasing power of the Flemish people."
Opposition Open VLD comes out against the investments
Minister President Diependaele said the investment was going to a “reliable, future-oriented network,” while Minister Crevits, whose portfolio includes Home Affairs and Social Economy, stressed its importance in keeping municipalities financially stable.
Finance Minister Ben Weyts gave the assurance that the plan would avoid any negative budget impact.
Plans include simplifying intercommunal structures and tariffs. The first legislative phase entails adapting the Energy Decree, followed by the simplification of operations in the next municipal term.
The opposition Open VLD party criticised the Fluvius investment, together with a recent decision to invest €2.77 billion in Brussels Airport, making the Government of Flanders its largest shareholder.
”This government thrives on state capitalism, from Brussels Airport to sidelining private Fluvius investors,” Open VLD leader Egbert Lachaert said on social media. “Debt is skyrocketing.”
