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Rating action

Scope Ratings GmbH (Scope) has today upgraded Uniper SE’s issuer rating to BBB/Stable from BBB-/Stable. Scope has also upgraded the senior unsecured debt rating to BBB from BBB- and affirmed the short-term debt rating at S-2.

The rating action reflects a further improvement in Uniper’s financial risk profile driven by strong financial performance in 2024 and better visibility on cash flows in the next couple of years. It also reflects the gradual transformation of the business model towards low-carbon, contracted activities.

The full list of rating actions and rated entities is at the end of this rating action release.

Key rating drivers

The issuer rating reflects a standalone credit assessment of BBB- and a one-notch uplift, reflecting the utility's status as a government-related entity.

Business risk profile: BB (unchanged). Uniper’s business risk profile benefits from: i) its position as an important European player in power and gas supply; ii) solid diversification regarding markets and technologies; iii) accelerated decarbonisation of its power generation fleet (positive ESG factor); and iv) some integration across its value chain. Challenges include: i) industry-inherent merchant risks in non-regulated power generation and commodity trading; ii) large parts of the power generation fleet with a weak position in the merit order and above-average carbon intensity (negative ESG factor); iii) regulatory, environmental and political risks mainly related to fossil-fuel, but also to nuclear power plants to some extent (negative ESG factor); iv) the vulnerability of group profitability to external and non-controllable effects; and v) overall margin dilution due to a high share of trading business.

Uniper is continuing to transform its business model and implement the asset divestment plan as part of remedies under EU state aid approval. September 2024 marked a significant step in the utility’s planned coal exit with the decommissioning of the coal-fired power plants Ratcliffe in the UK and Heyden 4 in Germany. Uniper also initiated the process of selling the Datteln 4 coal-fired power plant in Germany. The decommissioning of the aforementioned plants and the discontinuation of commercial operations at the German coal-fired power plants Staudinger 5 and Scholven B in 2024, coupled with higher generation volumes from hydro and nuclear power plants, has significantly decreased Uniper’s carbon intensity to 272g CO2e/kWh in 2024 from 356g CO2e/kWh in 2023. Scope expects this metric to fall further, supported by the disposal of the Gönyű gas-fired power plant in Hungary and the planned disposal of Datteln 4. This will positively impact the position of the power generation fleet in the merit order system.

Uniper’s business risk profile also benefits from the ongoing strengthening of risk management. This includes reduced margining risk, a more diversified and flexible gas and LNG portfolio, and the reduction of price risk in the outright generation portfolio through the signing of long-term PPAs and participation in regulatory schemes. At the same time, Scope sees a somewhat negative impact from the asset disposals and power plant closures in terms of Uniper’s market dominance, recurring electricity generation volumes, geographical diversification, and asset and fuel concentration.

Scope also notes that Uniper had to adjust its timeline for implementing investment projects, focusing on those that will contribute most to growth and transformation. In this context, the utility has postponed the target date for achieving carbon neutrality for Scope 1 and 2 emissions from 2035 to 2040, bringing it into line with the target for Scope 3 emissions. This was primarily due to the regulatory framework developing more slowly than expected, including the power plant strategy in Germany and the ramp-up of the hydrogen economy.

Financial risk profile: A- (raised from BBB). The upward revision of Uniper’s financial risk profile is driven by strong financial performance in 2024 and improved visibility on cash flows in the next couple of years, including the settlement of contractual recovery claims of the German government.

In March 2025, Uniper repaid around EUR 2.6bn to the German government in accordance with the EU state-aid decision and the framework agreement concluded between the German government and Uniper from December 2022. Despite this significant payment, the utility maintained a robust liquidity buffer of around EUR 5.9bn as of 31 March 2025.

Scope expects Uniper to maintain a very low leverage – as measured by Scope-adjusted debt/EBITDA* – at around 0x in the next couple of years. This is despite the stabilisation of earnings and cash flows below recent levels, growing capex spending and likely dividend payments.

Scope believes EBITDA is likely to decline to around EUR 0.9bn-1.3bn in 2025 and around EUR 0.8bn-1.2bn thereafter from a still strong level of EUR 2.7bn in 2024, mainly driven by a further moderation in market fundamentals. Scope expects a significant increase in investment spending to EUR 1.0bn-1.5bn per year in the next couple of years, compared with EUR 0.7bn in 2024, as Uniper progresses with its transformation and growth focused strategy, pushing free operating cash flow into negative territory.

While the large investment programme is likely to put pressure on leverage beyond Scope’s forecast horizon, the rating agency expects Uniper to keep it under control. This view is supported by Uniper’s target debt factor (defined by the utility as economic net debt/adjusted EBITDA) of less than or equal to 2.5x.

Uniper generated a net interest surplus in 2024, supported by a strong liquidity buffer. While the liquidity buffer and EBITDA are expected to decrease, Scope believes that EBITDA interest cover is likely to remain above 10x in the next couple of years.

Liquidity: adequate (unchanged). Scope continues to see Uniper’s liquidity as adequate. This view is primarily based on the availability of cash and cash equivalents of EUR 5.9bn as of 31 March 2025, the EUR 5.0bn KfW facility (unused as of 31 March 2025) and the EUR 3.0bn revolving credit facility (unused as of 31 March 2025). These comfortably cover the moderate amount of maturing financial debt and the expected negative free operating cash flow.

Supplementary rating drivers: +1 notch (unchanged). Scope continues to assess Uniper as a government-related entity and applies a bottom-up approach in accordance with its Government Related Entities Rating Methodology. The capacity of the German government (rated AAA/Stable by Scope) to provide support remains ‘high’ and the government’s willingness to provide support is assessed at ‘medium’. Scope notes that the EU remedies require the German state to reduce its stake in Uniper to a maximum of 25% plus one share by end-2028.

One or more key drivers of the credit rating action are considered an ESG factor.

Outlook and rating sensitivities

The Stable Outlook reflects Scope’s expectation of solid operating performance coupled with low leverage (debt/EBITDA below 2.0x) and very strong EBITDA interest cover of above 10x despite negative free operating cash flow burdened by the growing investment spending of EUR 1.0bn-1.5bn per year. Scope also expects the German government to keep its controlling stake in the utility in the next couple of years.

The upside scenarios for the ratings and Outlook are (collectively):

1. Neutral or positive free operating cash flow and debt/EBITDA remaining below 1.0x on a sustained basis
    
2. Stronger business risk profile, e.g. through higher and more stable profitability
    
3. Continued government support

The downside scenarios for the ratings and Outlook are (individually):

1. Debt/EBITDA above 2.0x and EBITDA interest cover below 7x on a sustained basis
    
2. The German government giving up control of the company

Debt ratings

The rating on senior unsecured debt including the EUR 2.0bn debt issuance programme has been upgraded to BBB, in line with the upgraded issuer rating.

The affirmed S-2 short-term debt rating is based on the underlying BBB/Stable issuer rating and reflects Uniper’s better-than-adequate short-term debt coverage, which is supported by the available KfW facility and the revolving credit facility.

Environmental, social and governance (ESG) factors

In August 2023, Uniper presented its new, ambitious strategy to accelerate its transformation into a greener company with a low-risk business model. A successful execution of the strategy will likely support the utility’s business risk profile in the medium to long term. Targets include an exit from coal by 2029; zero-carbon for at least 80% of installed generating capacity and for 5%-10% of the gas portfolio by 2030; and carbon-neutrality for Scope 1 to 3 emissions by 2040, 10 years earlier than previously planned. The strategy assumes around EUR 8bn of transformation and growth investments up to the early 2030s.

Nevertheless, large parts of the power generation fleet still have a weak position in the merit order and an above-average carbon intensity in a European context. This is particularly the case for the highly CO2-intensive coal-fired power plants. Uniper is also exposed to regulatory, environmental and political risks, mainly related to fossil-fuel, but also to some extent to nuclear power plants. While the security of energy supply amid the European energy crisis has put these risks into perspective, Scope expects them to play a greater role in the future.

All rating actions and rated entities

Uniper SE

Issuer rating: BBB/Stable, upgrade

Senior unsecured debt rating: BBB, upgrade

Short-term debt rating: S-2, affirmation

*All credit metrics refer to Scope-adjusted figures.

Stress testing & cash flow analysis
No stress testing was performed. Scope Ratings performed its standard cash flow forecasting for the company.

Methodology
The methodologies used for these Credit Ratings and/or Outlook, (General Corporate Rating Methodology, 14 February 2025; European Utilities Rating Methodology, 17 June 2024; Government Related Entities Rating Methodology, 10 December 2024), are available on https://scoperatings.com/governance-and-policies/rating-governance/methodologies.
Information on the meaning of each Credit Rating category, including definitions of default, recoveries, Outlooks and Under Review, can be viewed in ‘Rating Definitions – Credit Ratings, Ancillary and Other Services’, published on https://www.scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Historical default rates of the entities rated by Scope Ratings can be viewed in the Credit Rating performance report at https://scoperatings.com/governance-and-policies/regulatory/eu-regulation. Also refer to the central platform (CEREP) of the European Securities and Markets Authority (ESMA): http://cerep.esma.europa.eu/cerep-web/statistics/defaults.xhtml. A comprehensive clarification of Scope Ratings’ definitions of default and Credit Rating notations can be found at https://www.scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Guidance and information on how environmental, social or governance factors (ESG factors) are incorporated into the Credit Rating can be found in the respective sections of the methodologies or guidance documents provided on https://scoperatings.com/governance-and-policies/rating-governance/methodologies.
The Outlook indicates the most likely direction of the Credit Ratings if the Credit Ratings were to change within the next 12 to 18 months.

Solicitation, key sources and quality of information
The Rated Entity and/or its Related Third Parties participated in the Credit Rating process.
The following substantially material sources of information were used to prepare the Credit Ratings: public domain, the Rated Entity and Scope Ratings' internal sources.
Scope Ratings considers the quality of information available to Scope Ratings on the Rated Entity or instrument to be satisfactory. The information and data supporting these Credit Ratings originate from sources Scope Ratings considers to be reliable and accurate. Scope Ratings does not, however, independently verify the reliability and accuracy of the information and data.
Prior to the issuance of the Credit Rating action, the Rated Entity was given the opportunity to review the Credit Ratings and/or Outlook and the principal grounds on which the Credit Ratings and/or Outlook are based. Following that review, the Credit Ratings and/or Outlook were not amended before being issued.

Regulatory disclosures
These Credit Ratings and/or Outlook are issued by Scope Ratings GmbH, Lennéstraße 5, D-10785 Berlin, Tel +49 30 27891-0. The Credit Ratings and/or Outlook are UK-endorsed.
Lead analyst: Marlen Shokhitbayev, Senior Director
Person responsible for approval of the Credit Ratings: Sebastian Zank, Managing Director
The Credit Ratings/Outlook were first released by Scope Ratings on 13 June 2017. The Credit Ratings/Outlook were last updated on 26 June 2024.

Potential conflicts
See www.scoperatings.com under Governance & Policies/Regulatory for a list of potential conflicts of interest disclosures related to the issuance of Credit Ratings, as well as a list of Ancillary Services and certain non-Credit Rating Agency services provided to Rated Entities and/or Related Third Parties.

Conditions of use/exclusion of liability
© 2025 Scope SE & Co. KGaA and all its subsidiaries including Scope Ratings GmbH, Scope Ratings UK Limited, Scope Fund Analysis GmbH, Scope Innovation Lab GmbH and Scope ESG Analysis GmbH (collectively, Scope). All rights reserved. The information and data supporting Scope’s ratings, rating reports, rating opinions and related research and credit opinions originate from sources Scope considers to be reliable and accurate. Scope does not, however, independently verify the reliability and accuracy of the information and data. Scope’s ratings, rating reports, rating opinions, or related research and credit opinions are provided ‘as is’ without any representation or warranty of any kind. In no circumstance shall Scope or its directors, officers, employees and other representatives be liable to any party for any direct, indirect, incidental or other damages, expenses of any kind, or losses arising from any use of Scope’s ratings, rating reports, rating opinions, related research or credit opinions. Ratings and other related credit opinions issued by Scope are, and have to be viewed by any party as, opinions on relative credit risk and not a statement of fact or recommendation to purchase, hold or sell securities. Past performance does not necessarily predict future results. Any report issued by Scope is not a prospectus or similar document related to a debt security or issuing entity. Scope issues credit ratings and related research and opinions with the understanding and expectation that parties using them will assess independently the suitability of each security for investment or transaction purposes. Scope’s credit ratings address relative credit risk, they do not address other risks such as market, liquidity, legal, or volatility. The information and data included herein is protected by copyright and other laws. To reproduce, transmit, transfer, disseminate, translate, resell, or store for subsequent use for any such purpose the information and data contained herein, contact Scope Ratings GmbH at Lennéstraße 5 D-10785 Berlin. Public Ratings are generally accessible to the public. Subscription Ratings and Private Ratings are confidential and may not be shared with any unauthorised third party.