By Christoph Steitz and Tom Käckenhoff

FRANKFURT/DUESSELDORF (Reuters) - RWE , Germany's biggest electricity producer, on Thursday said it will reach the upper end of its 2020 profit estimate thanks in part to its increasing focus on renewables, in particular solar and wind power.

Europe's No.3 renewables player posted an 18% rise in first-half adjusted earnings before interest, tax, depreciation and amortisation (EBITDA), citing capacity market payments in Britain, higher wholesale power prices and stronger wind output.

Large energy corporations are increasingly shifting away from fossil fuels to the renewables sector and carbon neutral technologies, most notably wind and solar. In a radical overhaul RWE has pledged to become carbon neutral by 2040.

Last week, oil major BP unveiled plans for a 50 gigawatts (GW) renewables expansion by 2030, a move RWE finance chief Markus Krebber said highlighted the potential of the sector.

"There is room for several players," he told journalists in a conference call. "RWE has weathered these difficult times well so far, and this is also reflected in our business performance for the first six months."

The group said it now expects to hit the upper end of the forecast range for adjusted EBITDA and EBIT, of 2.7 billion to 3.0 billion euros (2.4 - 2.7 billion pounds) and 1.2 billion to 1.5 billion euros respectively. This compares with 2.5 billion euros and 1.3 billion euros respectively in 2019.

RWE shares rose as much as 2.2%, having gained a quarter so far this year.

"RWE did comparably very well with its renewables core business, especially given the tough COVID environment E.ON showed yesterday," a Frankfurt-based trader said.

E.ON , which focuses on energy grids and retail, on Wednesday cut its profit outlook due to the impact of the coronavirus crisis on its business.

Among RWE's business units, the strongest increase occurred at its coal and nuclear division, where higher wholesale prices led adjusted EBITDA to more than double in the first half. Adjusted EBITDA at the group's offshore wind unit rose 19%.

(Additional reporting by Vera Eckert; Editing by Jan Harvey and Elaine Hardcastle)