Category: Stromkonzerne

Italian power giant Enel has announced the sale of Russia´s largest coal plant Reftinskaya (3.8 GW) to leading Siberian power and heat utility Kuzbassenergo, owned by SGC (SUEK), for “at least” RUB21bn (approx. $320m).

Enel is the 2nd largest global utility. It is regarded as the forerunner in the utility world thanks to its fast and successful switch to renewable power in Europe and the Americas, to smart grids and EV infrastructure.

In May 2019, Enel reached its highest market capitalization ever at €58.7bn. It is the largest utility in Europe, ahead of Iberdrola and EDF. Worldwide, the company ranks second only to US-based NextEra (excluding Chinese state-owned conglomerates).

Enel´s CEO Starace recently warned that the EU power sector has reached a “watershed” as cheap renewables will destroy the economic viability of coal production within a decade.

As the outgoing president of Eurelectric, the Europan power industry body, he praised the new-found alliance between the European Commission and the European power sector with both promoting a swift transition to decarbonized power solutions.

In stark contrast to the gloomy appearance of the UK or German power industries, he sees good prospects for the sector in a more and more electrified world.

The IEA concluded in its latest “World Energy Investment 2019” report that utilities focussing on renewables on average show a better financial performance in terms of capital cost (WACC) and returns (ROIC).

Links and Sources:

https://www.ft.com/content/444c9980-83b4-11e9-b592-5fe435b57a3b

https://www.enelrussia.ru/en/media/press/d201906-enel-russia-board-of-directors-called-extraordinary-general-shareholders-meeting-to-approve-reftinskaya-gres-sale.html

Picture: Enel power plant in Russia, courtesy Enel.

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Sweden´s Vattenfall AB is accelerating the transition to renewables, as German newspaper F.A.Z. reports.

The large utility, which is 100 percent owned by the Swedish state, plans to quadruple the share of renewables by 2025. This includes the expansion of wind power capacities from 3 GW (end of 2018) to 11 GW (2025). Within “one generation”, the group as well as its customers and suppliers should be “fossil-free”.  Currently, Vattenfall generates about  25 percent of its power from fossil fuels.

In Germany, Vattenfall has abandoned its lignite assets a few years ago and is abandoning its German nuclear assets. In Sweden, however, the company will continue to operate its large nuclear plant Ringhals.

Vattenfall is already one of the largest offshore wind power operators in Europe. Further wind farms are currently being built in the Baltic Sea. To finance these projects, the company intends to make greater use of external sources. Parts of wind farms could also be sold to investors.

Unlike E.ON (Innogy/RWE) or Ørsted, however, the company does not intend to become a global player, but continues to concentrate on Northern Europe and Great Britain.

In addition to wind farms, green hydrogen will play an important role in its corporate strategy. This includes a pilot plant in Luleå. Here, a steelworks replaces coke with hydrogen generated by green electricity (wind, hydro).

Additional RE activities are:

• Vattenfall´s electrolysis plants near Gothenburg are involved in the production of biofuels from cellulose.
• In Germany, a centralized power-to-heat project (Berlin) will provide district heating to consumers.

Find more on the latest utility strategies in the next edition of our Global Energy Briefing (German/English version available)

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