ESSEN, Germany (Reuters) – E.ON, Europe’s biggest operator of energy networks, on Wednesday raised its five-year investment target to 42 billion euros ($46 billion), saying the continent required major grid expansion to make the transition to clean energy sources.

The new spending plan for the 2024-2028 period is up 27% from the 33 billion euro target for the previous 2023-2027 period, the company said, adding this would lead adjusted core profit (EBITDA) to rise to 11 billion euros by 2028.

For 2024, the company expects adjusted EBITDA to decline to 8.8 billion to 9.0 billion euros, down from the 9.4 billion last year which was marked by a number of one-offs at the group’s retail energy division.

“Across Europe, there are massive expansion plans for renewable facilities that will need to be connected to networks,” E.ON Chief Financial Officer Marc Spieker said.

“That’s why we’re investing even more and even faster in our power grid infrastructure, which is set to continuously grow by an average of ten percent annually through 2028.”

The company said it would propose to increase its dividend to 0.53 euros per share for 2023, up from 0.51 euros each for the previous year. This is in line with the 0.53 euro LSEG estimate.

($1 = 0.9140 euros)

(Reporting by Christoph Steitz and Tom Kaeckenhoff, Editing by Louise Heavens)