Type Società per azioni Founder Italian government Headquarters Rome, Italy | Traded as BIT: ENEL Area served Italy Revenue 75 billion EUR (2014) | |
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Industry Electricity
Natural gas Founded November 27, 1962; 54 years ago (1962-11-27) Stock price ENEL (BIT) € 4.18 -0.01 (-0.24%)10 Mar, 4:45 PM GMT+1 - Disclaimer CEO Francesco Starace (27 May 2014–) Subsidiaries Enel Green Power, Endesa, Enel Distribuzione SpA Profiles |
Enel is an Italian multinational manufacturer and distributor of electricity and gas.
Contents
- Optimizing enel s distribution network with adms schneider electric
- 18981962 Towards a national policy for electricity
- 1962 Establishing the National Entity for Electricity
- 19631970 Modernization and development of the network
- National dispatch centre
- Rural electrification
- High voltage network and connection to the islands
- The Vajont disaster
- 19701980 The energy crisis and the search for new sources
- The energy crisis
- New plants
- 19801990 renouncing nuclear power
- New plants and alternative energy
- Referendum the closing of nuclear power plants and the new national energy plan
- 19902000 liberalisation and privatisation
- Liberalisation privatization and stock market launch
- Other operations
- 20002010 environmental policies and internationalization
- Environmental policies
- Mergers and acquisitions
- 2010today
- Industrial activities
- Corporate activities
- Research and development activities
- Activities
- Electricity production
- Research and Development
- The Italian Market
- International Activity
- Belgium
- Bulgaria
- Cyprus
- France
- Greece
- Netherlands
- Romania
- Russia
- Slovakia
- Spain and Portugal
- Turkey
- United States and Canada
- South America
- Argentina
- Brazil
- Chile
- Colombia
- Ecuador
- Peru
- Uruguay
- Costa Rica
- Guatemala
- Mexico
- Panama
- Algeria
- Egypt
- Morocco
- South Africa
- Italy
- Europe
- Latin America
- Major Shareholders
- Logo
- Expo 2015
- Enel Cuore
- Osage Wind LLC
- El Salvador
- Analysis of Enels 2006 financial statement
- Analysis of Enels 2007 financial statement
- Analysis of Enels 2008 financial statement
- References
Enel, which originally stood for National Entity for Electricity (Ente nazionale per l'energia elettrica), was first established as a public body at the end of 1962, and then transformed into a limited company in 1992. In 1999, following the liberalization of the electricity market in Italy, Enel was privatized. As of February 2015, the Italian government is the owner of 25.5% of the company's shares.
In 2014, Enel employed about 70,000 people, works in about 30 countries and at the end of 2013 – with 80.5 billion euro of revenue and a market capitalization of 31 billion euro – is the 56th company in the world by revenue. The company is a component of the Euro Stoxx 50 stock market index.
Optimizing enel s distribution network with adms schneider electric
1898–1962: Towards a national policy for electricity
In 1898, the production of electricity in Italy was of 100 million kilowatt hours reaching a value of over $56 billion by 1960. The majority of the electricity was produced by regional private companies, or by companies linked to other industrial bodies, that were both local and regional, by exploiting the specific characteristic of the territory: its hydrogeological resources.
The state subsidized the construction of power stations and any necessary construction work in the territory in order to increase the production of electricity. In terms of distribution, the state intervened in 1961 by unifying national tariffs on the basis of equal consumption classes (through the Equalization Fund for the Electricity Sector) and by requiring power companies to provide access to electricity to everyone.
In 1962, the government institutionalised the Entity for electricity with the aim of making electricity a means for the development of the country and in order to define a national policy for electricity based on the experiences of other countries such as France and Britain.
1962: Establishing the National Entity for Electricity
At the beginning of 1962, the Fanfani IV Cabinet made its commitment to the government to put together a proposal for the unification of the national electricity system within three months of the parliament casting its confidence motion. During the Chamber of Deputies assembly of 26 June 1962, the government presented a bill that sanctioned the principles and procedures for the establishment of the Entity for Electricity (E.N.EL.).
According to the bill, Enel was going to acquire all assets of all companies operating in the production, processing, transmission and distribution of electricity, with the exception of self-producers – companies that produced more than 70% of their electricity for other production processes – (the same exception was later applied to municipal authorities), and of small businesses that did not produce more than 10 million kilowatt hours per year.
Procedures to assess the value of the acquired companies were defined, and it was established that compensation were to be paid to creditors in 10 years at an interest rate of 5.5%. In this framework, 1962 was to be considered a transition year, in which all income and expenses of the acquired companies would be transferred to Enel. 1963 was thus the first operational year of the newly formed company.
The first companies to be acquired were:
1963–1970: Modernization and development of the network
Enel’s early goals were the modernisation and development of the electricity grid with the construction of high voltage backbones, international connections, connection to the islands, the electrification of rural areas and the creation of the National Center for dispatching. These projects were to be co-financed by the state through the issuing - in 1965 - of bonds of a value of over 200 billion Italian liras. In 1967 Enel’s supervision was redirected from the Committee of Ministers to the interministerial Committee for Economic Planning (CIPE), under the Ministry of Industry. During this period, the production of thermoelectric power surpassed for the very first time that of hydroelectric power.
National dispatch centre
In 1963, the National Dispatch Centre of Rome was created in order to manage the energy flows on the network by coordinating the production plants, the transmission network, the distribution as well as the interconnection of the Italian electricity system with that of foreign countries, by adjusting in real time the production and transmission of energy on the basis of the actual demand.
Rural electrification
In terms of rural electrification the settlements that were not connected to the electricity grid went from 1.27% in 1960 to 0.46% in 1964, with over 320,000 new residents connected. In the five-year period between 1966 and 1970 further investments for rural electrification were made – 80% of the costs were covered by the state and 20% by Enel – those were complemented by reduced rates as an incentive for agricultural development.
High-voltage network and connection to the islands
In 1968, the construction work of the 380 kV connection between Florence and Rome began with the aim of joining the high voltage electrical system of the north with that of the south centre. Around the same time international high voltage connections with France (380 kV Venaus-Villarodin, 1969) and Switzerland were also put in place.
In the same years undersea electrical cables were put in place to connect the peninsula and the islands of Elba (1966), Ischia (1967) and Sardinia through Corsica (1967).
The Vajont disaster
Enel was involved in the Vajont Dam disaster, which took place at the Vajont reservoir, which was artificially created to produce a large quantity of hydroelectric power. On 9 October 1963 a huge landslide of 260 million cubic metres fell into the reservoir. The dam and power plant had been built by SADE (Società Adriatica di Elettricità – Adriatic Electricity Company) and then sold to Edison and had just been transferred as part of the nationalisation process to the newly set up Enel.
The impact of the landslide created huge waves in the Vajont reservoir, which partially flooded the villages of Erto e Casso and swept over the dam, totally wiping out the towns in the valley below it: Longarone, Pirago, Rivalta, Villanova and Faè. Approximately two thousand people died in the disaster. Enel and Montedison, were charged at the ensuing trial as the companies responsible for the disaster, a responsibility considered all more serious because of the predictability of the event. The two companies were forced to pay damages to the communities involved in the catastrophe.
1970–1980: The energy crisis and the search for new sources
The decade of the 1970s was distinguished by a major energy crisis that led the company to drastic austerity measures and the establishment of a national energy plan that defined the objective of both building new power plants and the search for new energy sources.
The energy crisis
In 1975, as a result of the oil crisis and the Austerity measures, and following the definition of the first National Energy Plan (PEN), the aim of the company became that of reducing Enel’s dependence on hydrocarbons. This was to be achieved with the use of other energy sources, which included hydro, geothermal, increasing the use of coal, the waste cycle and in particular with the use of nuclear energy.
New plants
Several new plants were built in the course of the decade:
1980–1990: renouncing nuclear power
The 1980s was characterised by the construction of new plants and testing of alternative forms of energy, as well as a gradual reduction of oil reliance that went from 75.3% in 1973 to 58.5% by 1985.
In 1986, Enel had its first positive balance, with 14 billion and 100 million Italian liras gross profit.
Finally, in 1987, in the aftermath of the Chernobyl disaster, the first referendum on nuclear power took place. This marked the end of nuclear power in Italy, the closing and suspension of all construction of nuclear power stations and the establishment of a new national energy plan.
New plants and alternative energy
In the same decade the following plants became active:
With regards to alternative energy:
During 1985 the national center for the dispatch and control of the electricity network was gradually transferred from the center of Rome to Settebagni, and made a part of a bigger European network of synchronisation of the production of electricity.
Referendum, the closing of nuclear power plants and the new national energy plan
Following the Chernobyl disaster of 1987, a referendum sanctioned the interruption of all production of nuclear power in Italy. In relation to existing nuclear power plants or those that were under construction at the time:
In 1988, the new National Energy Plan (PEN) established its key objectives as: increase energy efficiency; environmental protection; exploitation of national resources; diversification of supply sources from abroad; overall competitiveness of the production system.
1990–2000: liberalisation and privatisation
Between 1990 and 2000, the country witnessed a progressive liberalisation of the electricity market.
In July 1992, the Amato I Cabinet turned Enel into a limited company with the Treasury as the sole shareholder.
In 1999, the Bersani Decree mark the beginning of the liberalisation of the electricity market; a corporate restructuring of Enel began, with the unbundling of the production, transmission, dispatch and sale of energy.
New plants and alternative energy
With regards to alternative energy:
Liberalisation, privatization and stock market launch
Other operations
2000–2010: environmental policies and internationalization
During the 2000s, the company worked on policies to reduce the environmental impact of the production of energy and on a progressive internationalization of Enel through a number of mergers and acquisitions.
Environmental policies
Mergers and acquisitions
New plants and alternative energy
Other operations
2010–today
This period was marked by the appointment of a new Board of Directors, that defined the reorganisation of assets abroad and reducing the company’s debt as the company’s main priorities for the future.
Industrial activities
Corporate activities
Research and development activities
Other operations
Activities
Listed on the Milan stock market since 1999, and headquartered in Rome, Enel is part of a group of companies that produce and distribute electricity and gas in 30 countries around Europe, North America, South America, Asia and Africa.
The group employs around 70,000 people, has over 60 million customers worldwide (56 million in the electricity market, and in the 6 million in the gas market) and a net installed capacity of over 89 GW, it is the first in Europe for number of customers and second, after EdF, for capacity.
Electricity production
Enel produces electricity through a number of different energy sources including geothermal, wind power, solar power, hydroelectric power, thermal and nuclear power. In 2014 the Enel Group generated a total of 283.1 billion kWh of electricity, distributed 395.4 billion kWh, and sold 261 billion kWh. Since 2008 Enel has entrusted the production of electricity from renewable sources to its subsidiary, Enel Green Power.
Research and Development
Enel is also engaged in research and development activities for the production and transmission of electricity. These include:
The Italian Market
In Italy, Enel operates in the following fields:
Following the liberalization of the market, Enel can no longer produce more than 50% of the total electricity produced in Italy, and like all other providers is bound by the universal service act and by European standards to connect to the grid anyone who requests so. Generally, Enel is subject to the supervision and decisions of the Authority for Electricity and Gas.
International Activity
Globally the group Enel, through its subsidiaries, covers the following areas and activities:
Enel operates in Europe: Bulgaria, France, Greece, Italy, Romania, Russia, Slovakia, Spain and Portugal. In North America: Canada and United States. And in Latin America: Argentina, Brazil, Chile, Colombia, Costa Rica, Guatemala, Mexico, Panama and Peru. Through its subsidiary Endesa, Enel is also present in Morocco.
Enel is organised in five divisions:
Enel is present in Europe (Bulgaria, France, Greece, Italy, Romania, Russia, Slovakia and Spain), North America (Canada and United States) and Latin America (Brazil, Chile, Costa Rica, Guatemala, Mexico and Panama). Thorough its subsidiary Endesa, Enel is also present in Argentina, Colombia, Morocco, Peru and Portugal.
Belgium
In Belgium Enel produces energy for a total capacity of 406 MW with the Marcinelle Energie power plant.
Bulgaria
Enel is present in Bulgaria through Enel Green Power that acquired two wind farms in 2008 and doubled their capacity by 2010, for a total of 42 MW. The plants are located in Kamen Bryag and Shabla in the north-east of the country along the coast of the Black Sea. The plants were scheduled to be sold in 2011.
Cyprus
In Cyprus Enel operates in the territory via Enel Trade; the company participates for 12.5% in a consortium for the exploration and production of gas in the Leviathan gas field located between Cyprus, Israel and Lebanon.
France
Enel supplies electricity in France and owns 5% of the energy exchange Powernext.
Greece
In Greece, Enel operates through Enel Green Power’s hydropower (19 MW), photovoltaic (71 MW) and wind (199 MW) power plants for a total of 289 MW.
Netherlands
In the Netherlands, Enel operates though a number of financing companies (Enel Finance International N.V., Enel Investment Holding B.V., International Endesa B.V.) that raise funds through bond issuances and other forms of financing, and invest in the production and distribution of electricity. Enel is also present through Endesa Energia S.A., a company that sells gas and electricity to large customers in Europe.
Romania
In Romania, Enel has over 2.6 million customers through majority shares in a number of electricity distribution companies in Sud-Muntenia, including in Bucharest, in the Banat and in Dobruja. The sale of these companies, announced in mid 2014, was withdrawn in early 2015. Through Enel Green Power, Enel is also one of the country’s electricity manufacturers, with a total capacity of 534 MW.
Russia
Enel is active in Russia in a number of different areas:
Slovakia
In Slovakia Enel owns 66% of Slovenské Elektrárne, which was acquired in 2006. Enel produces electricity for a total of 5,700 MW from nuclear, thermal and hydroelectric power. From the end of 2014, Enel has received several offers from buyers interested in acquiring its shares of Slovenské Elektrárne.
Spain and Portugal
Through its participation in Endesa, Enel is currently the main operator in Spain and Portugal, with a total electricity production of 23,474 MW (6,500 MW of which is renewable) and over 11 million customers in the electricity market, and 1.2 million in the gas market. In addition, Enel produces renewable energy with Enel Green Power España, for a total capacity of 1,745 MW in Spain, and of 163 MW in Portugal.
Turkey
In Turkey Enel takes part in the exploration for the production of geothermal energy with Enel Green Power and the group Meteor Uzun.
United States and Canada
In the United States of America and in Canada Enel Green Power North America (formerly known as Enel North America), a company controlled by Enel Green Power, generates hydropower, geothermal and wind power, and biomass for a total capacity of 2,083 MW (1,980 MW in the US, and 103 MW in Canada).
South America
In 2014 Enel - through Enel Green Power - is the second largest producer of solar energy in Latin America. Projects scheduled for the coming years are going to increase tenfold the photovoltaic production, turning the company into the first photovoltaics manufacturer in the region.
Argentina
In Argentina Enel produces electricity through Endesa (Chile)’s subsidiaries - Endesa Costanera, Hidroeléctrica El Chocón, and Dock Sud - for a total capacity of 4.522 MW. Through EDESUR Enel distributes electricity to over 2.3 million customers in the country.
Brazil
Enel produces electricity in Brazil through its subsidiaries Endesa Fortaleza and Cachoeira Dourada for a total capacity of 987 MW. Enel also operates in the transmission of electricity through Endesa CIEN, as well as in the distribution through:
Through one of its subsidiaries, Enel Brasil Participações Ltda, Enel Green Power produces electricity from renewable sources for a total of 376 MW - 203 MW of solar energy and 173 MW of hydroelectric power - with plans to expand to 378 MW.
Chile
In Chile Enel produces electricity for 6,590 MW. Through Enel Green Power Chile, Enel produces over 300 MW between hydropower and wind power, and is currently exploring options for geothermal energy.
Colombia
In Colombia Enel produces electricity for a total capacity of 2,994 MW. Enel Green Power develops projects for alternative energy in the country.
Ecuador
Following an agreements signed at the end of 2011 Enel currently explores for geothermal energy sources in Ecuador.
Peru
In Peru Enel produces electricity for a total capacity of 1,802 MW. Since 2011, Enel Green Power Peru has been working to develop alternative energy sources in the country and obtaining various concessions for electricity plants.
Uruguay
Through Enel Green Power, Enel has been building a wind power plant for 50 MW in Uruguay.
Costa Rica
Through Enel de Costa Rica S.A., a subsidiary of Enel Green Power Latin America, Enel produces electricity for a total of 55 MW, of which 24 MW is wind generated and 31 MW comes from hydroelectric power. The new hydropower plant Chucas, currently under construction, will generate an additional 50 MW.
Guatemala
Through Enel Green Power Guatemala, Enel produces electricity – generated entirely from hydroelectric power - for a total of 163 MW in the country.
Mexico
Enel has been present in Mexico since 2007. Through Enel Green Power it produces energy for 399 MW, of which 346 MW is wind power, and 53 MW is hydroelectricity.
Panama
Enel Fortuna – a subsidiary of Enel Green Power Panama - produces energy with a total capacity of 300 MW, which is calculated as 23% of the national demand for 2014. The company’s plan is to build new solar power plants in order to generate a further 29.9 MW.
Algeria
In Algeria, Enel holds 13.5% of the gas reserves in the Illizi Basin, in the southeast of the country, and 18.4% of the field of Isarene. In 2014, together with Dragon Oil, Enel acquired the gas exploration licenses for two additional areas, Msari Akabli and Tinrhert North. In Msari Akabli Enel is also going to be the first operator with a stake of 70%, while Tinrhert North it will own a 30% stake.
Egypt
In Egypt Enel holds 10% of the gas exploration licence for the area of El Burullus.
Morocco
Enel manufactures electricity in Morocco with Energie Electrique de Tahaddart, for a total capacity of 384 MW. In 2010, Enel Green Power took part in the tender for the construction of a solar thermal power plant. At the beginning of 2014 Enel Green Power was given the objective to produce wind power in Morocco. The plan was implemented in late 2014 with the participation in the call for the construction of 5 plants for a total capacity of 850 MW.
South Africa
In South Africa Enel Green Power owns a photovoltaic power plant with a total capacity of 10MW. Enel’s future plan is to build a number of wind farms and photovoltaic power plants for a total capacity of 513 MW.
Italy
In Italy Enel owns the following companies that produce, distribute and resell electricity:
With regards to infrastructures and grids Enel owns:
For trading on international markets and in Italy, as well as for the procurement and sale of energy products including gas, Enel owns 100% of Enel Trade, which in turn owns 100% of Enel Trade Romania, Enel Trade Croatia and Enel Trade Serbia.
Through Enel Trade, Enel also owns Nuove Energie, a company that specialises in the construction of regasification plants.
Europe
In Belgium, through Enel Investment Holding, Enel owns 100% of Marcinelle Energie - owner of the homonymous power plant which was acquired in 2008 by Duferco Diversification. The company was scheduled to be sold to Gazprom with a letter of intent in 2013, at the beginning of 2014 the sale was pending regulatory changes and not yet completed.
In France Enel owns 5% of the French energy exchange Powernext.
In Spain - through its subsidiary Enel Iberoamerica (previously known as Enel Energy Europe) – Enel holds 70.1% of Endesa, acquired in 2009 with a stake of 92.06%. The acquisition earned Enel the 2009 Platts Global Energy Award for Deal of the Year. In 2016 Endesa acquired Enel Green Power España from Enel for €1.207 billion.
Enel has been operational in Russia since 2004:
In 2013 Rosneft, through NGK Itera, bought 40% of Enel’s stake in Arctic Russia BV, a company which owned 19.6% of SeverEnergia.
Latin America
In Argentina Enel controls Edesur through Enersis and Distrilec Inversora S.A., the latter is owned for 51.5% by Enersis.
In Chile, through Enel Iberoamerica (formerly known as Enel Energy Europe), as a result of the purchase of Endesa and Endesa Latinoamerica S.A., Enel owns 60.62% of Enersis Chile.
In Peru, through Enersis Chile, and following the cartel signed with Inkia America Holding in 2014, Enel owns a 58.6% stake of Edegel Peru.
Major Shareholders
Logo
In 1982 was invented the company's famous logo, designed by Bob Noorda and Maurizio Minoja, which is a sun and a 9 tree whose branches or 9 rays represent the diversity of the services offered by the company.
At the heart of a new expression sits the cursor, an iconic visual symbol that represents Open Power. It was presented on January 26 of 2016. The new expression is as diverse and open as the company. It is a range of 8 colours, all of which are used in logo. Each letter consists of a cursor, followed by a colourful trail of energy. Its unique typography has been used throughout all brands of the company: for Enel, Enel Green Power and Endesa. This helps to create a strong, consistent family of brands.
Expo 2015
In 2015, Enel took part in Expo 2015, Milan, as an Official Global Partner. With a 29 million euros investment, as well as building its own pavilion, Enel built a Smart City over the entire Expo area, simulating a city of 100,000 inhabitants with a total energy consumption of 1,000,000 kWh per day.
The Smart City comprises:
Enel Cuore
Enel Cuore was founded in October 2003, by the project, supported by Enel and its subsidiaries, in order to create a non-profit organization separate from the company itself and able to carry out activities in support of communities, families and individuals while maintaining the ideals of cooperation.
Osage Wind LLC
On 11 November 2014, the United States Attorney for the Northern District of Oklahoma filed suit against Enel's subsidiary. Osage Wind LLC, an 84-turbine industrial wind project in Osage County, Okla. In the suit, the United States alleges that Enel and Osage Wind are illegally converting minerals owned by the Osage Nation, a Native American tribe that has owned all mineral rights in the county since 1871. The suit says that Osage Wind should have obtained a permit from the Bureau of Indian Affairs before mining rock and other material for the pits in which turbine bases are built. The United States asked that all excavating on the 8,500 acre site cease and that dozens of turbines that are already being erected be removed. Osage Wind has insisted that it is not mining and needs no permit. The company says that it has already spent nearly $300 million on the project, which is being built on privately owned fee land, not land held in trust for American Indians.
Osage Wind LLC and a second and adjacent Enel wind project, Mustang Run, are also embroiled in challenges pending before the Oklahoma Supreme Court in which the Osage Nation and Osage County, Okla., are challenging the constitutional legitimacy of permits for both projects.
El Salvador
The company had to exit El Salvador electricity market after a long dispute with the Government of El Salvador [1]. The constitution of El Salvador (Art 109) states that the natural resources (underground) are the country's property and the government would not allow foreign companies to be the sole proprietor of the geothermic generation. Both parties came to a settlement in 2014, but no details have been released.
Another setback for Enel has been the recent loss it had with the government of Slovakia where it had been demanding over EUR 94 million from the Ministry of Economy in compensation for lost earnings it claims to have incurred as price proposals were rejected by utilities regulator URSO.
Also as per an article of December 2014, in bne INTELLINEWS www.bne.eu/, "Slovakia puts more obstacles in way of Slovenske Elektrarne sale," (Prime Minister Robert) "Fico claims the Italian utility has blocked access to information that would allow Bratislava to assess if the plant’s profit is fairly distributed between Enel and the Slovak state, TASR news agency reported."
Analysis of Enel’s 2006 financial statement
Proceeds totalled 38,513 million euros (33,787 million in 2005, + 14.0%). EBITDA were 8,019 million euros (7,745 million in 2005, +3.5%); net of an allocation of around 400 million euros for an operating excellence plan, EBITDA 2006 increased by 8.7% over 2005. EBIT were 5,819 million euros (5,538 million in 2005, +5.1%). The Group’s net profits were 3,036 million euros (3,895 million in 2005, - 22.1%); net of the contribution by Wind and Terna, the Group’s net profits in 2006, increased by 1.4% over 2005. Net financial borrowing totalled 11,690 million euros (12,312 million at 31 December 2005, -5.1%). The total dividend offered for the whole 2006 financial year was 0.49 euros per share (of which 0.2 euros per share was paid in advance in November 2006).
Analysis of Enel’s 2007 financial statement
Proceeds totalled 43,673 million euros (+13.4%), EBITDA were 10,023 million (+25.0%), EBIT were 6,990 million (+20.1%), the Group’s net profits were 3,977 million (+31.0%), net financial borrowing increased to 55,791 million due to the Endesa take-over, total net assets were 23,789 million, the Debt-Equity ratio was 2.35. The dividend offered for the whole 2007 financial year was 0.49 euros per share (of which 0.2 euros per share was paid in advance in November 2007).
Analysis of Enel’s 2008 financial statement
Proceeds rose to 61,184 million euros (+40.0%), EBITDA were 14,318 million euros (+45.5%), EBIT were 9 million euros (+40.7%), the Group’s net profits increased to 5,293 million euros (+35.2%) net financial borrowing dropped to 49,967 million euros (-10.4%). The dividend offered for the whole 2008 financial year was 0.49 euros per share (of which 0.2 euros per share was paid in advance in November 2008).