German utility RWE confirmed plans Thursday to build another 4 gigawatts of renewables by 2022, expanding the scope for its annual investments into wind and solar.

In its annual report, RWE said it will invest €1.5 billion to €2 billion (or as much as $2.2 billion) into renewables each year in the near term. That's up from the €1.5 billion pledged just six months ago when the company completed the bulk of its complex asset-swap deal with E.ON, another German utility.

That deal saw RWE effectively swapping its customer supply business for a 17-gigawatt development pipeline of renewable projects, mainly wind. In Thursday's update (PDF), RWE said it now has a 20-gigawatt development pipeline and 2.7 gigawatts under construction.

In total, RWE will spend €5 billion by 2022 growing its renewables portfolio, with 20 percent earmarked for Germany.

With full-year results in, RWE appears to be benefiting from its new structure. Revenue from E.ON's assets added to the bottom line for the last few months of 2019. The restart of U.K. capacity market payments and commissioned power plants helped lift earnings before interest, tax, depreciation and amortization (EBITDA) from the forecast upper limit of €1.7 billion to €2.5 billion.

RWE is one of a number of European utilities to have enjoyed considerable success in international renewables markets, including North America.

As of the end of 2019, RWE had 2.8 gigawatts of onshore wind in the U.S., courtesy of the E.ON deal. More than half of RWE’s projects currently under construction are in the Americas, including the 440-megawatt Big Raymond onshore wind project in Texas.

An eye on floating wind

In the past, RWE set itself apart from its peers by mining its own coal for its power stations, said CEO Rolf Martin Schmitz. But now it needs to look for other differentiators.

“Cost advantages and good project management are the key success factors in this business,” Schmitz wrote in the company’s annual report. “On top of that, we must become a leader in technological innovations.”

“What I would ask of our project developers and engineers is, ‘Always keep up with the pace of technology.’ This is because renewables are in an era where the best technology decides who is successful. And this also applies to energy storage. We simply have to lead from the front,” he said.

Schmitz cited floating wind as a prime example where first movers would be able to benefit from an expanded market place for offshore wind in deeper water.

“We’re working on intelligent and cost-effective variants of such platforms. If our efforts prove successful, this could set us apart from the competition,” he said.

RWE (via Innogy) has partnered with Shell to develop the TetraSpar floating foundation. A demonstration unit will go into the water off the coast of Norway this year.

Closing down coal with "dignity"

Since RWE's last results were announced, Germany’s government has agreed on €40 billion coal-power phaseout, with €2.6 billion set aside for RWE. All coal power plants in Germany will be closed by 2038.

Despite claiming that settlement leaves the company at financial risk, Schmitz said the deal is preferable to a long-running legal dispute with Berlin, allowing the company to move on.

“Many feel abandoned by the state and some perhaps also by RWE," he wrote in the annual report. "I think that’s completely understandable. But we mustn’t forget that lignite-fueled electricity generation would have ended by the middle of this century anyway."

“We should pay our dues to this old power production technology by bidding it farewell in style and with dignity. And as far as RWE is concerned, I would like to add that our early investments in renewable energy were made with the money we earned with our lignite and nuclear power stations.”