* EBIT down to 414 mln euros from 490 mln
* Underlying revenues rise to 1.55 bln from 1.4 bln
FRANKFURT, July 29 (Reuters) - TenneT (IPO-TTH.AS) cut investments in grid infrastructure in the Netherlands and Germany by 27 percent in the first half of this year and posted 15.5 percent lower earnings before interest and taxes (EBIT), the Dutch grid operator said on Friday.
The state-owned firm, based in two locations in Arnhem and Bayreuth, is a key player in ensuring reliable electricity grids in the region to accommodate rising renewable capacity and to cooperate across borders.
It cited a negative impact from German pension provisions, and one-off effects from special items in the year-ago period as reasons behind the declining earnings.
But it stressed that its asset base was growing and that income from rising system services costs was solid, allowing for a 10.8 percent rise in revenue in the six-month period.
“The operating performance we have realised is in line with out total investments and supports our debt portfolio, which currently amounts to 5.8 billion euros ($6.43 billion),” said chief financial office Otto Jager.
Investments in January to June totalled 875 million euros, EBIT 414 million euros and revenue 1.55 billion.
Jager said stable regulatory support was necessary in the future.
Regulators in both countries have proposed cutting the permitted rate of return for grid investments in the current low interest rate environment.
Most of the company’s income comes from grid usage fees, which consumers pay as part of overall power costs.
TenneT recently received assurances from the Dutch state that an additional equity contribution of up to 1.2 billion euros will be made from 2017 through 2020 for investments in the Dutch grid.
TenneT in June unveiled a vision for further integrating the countries bordering on the North Sea by building an island surrounded by wind farms.
In the coming years, TenneT will build five offshore wind platforms with a total capacity of 3,500 MW for the Netherlands while working on three offshore grid connections for wind projects in Germany with a joint capacity of 2,827 MW.
Onshore work in Germany continues on the SuedLink connection and TenneT has also been chosen to construct another big link, called SuedOstLink.
It is also preparing for the construction of NordLink, a new cable between Norway and Germany to complement existing sea cables between Norway and Britain, and a planned link to connect the Dutch and Danish grids.
$1 = 0.9016 euros Reporting by Vera Eckert, editing by Adrian Croft