Enel’s leadership in renewables
Enel’s leadership in renewables
According to the report by the Institute for Energy Economics and Financial Analysis, our Group and NextEra are the two utilities that are best interpreting the transition from fossil fuels to renewable sources. This accolade confirms Enels’ leadership in the field
The latest accolade comes from the report “Global Electricity Utilities in transition” by the Institute for Energy Economics and Financial Analysis (IEEFA), which analysed the economic performance and financial position of 11 of the world’s most important utilities. According to the report, we together with NextEra, the US wind energy powerhouse, are the two energy utilities that are best interpreting the transition from fossil fuels to renewables.
The report compares the world’s main utilities at a time when renewable sources represent a change of course in the energy market. It is a change that very few people would have imagined “just a few years ago,” but which is bound to grow rapidly in coming years. Bloomberg's New Energy Outlook 2017 expects that in 2040 solar and wind energy will account for 48% of the total installed capacity and 34% of electricity generation. The IEA (International Energy Agency) expects a 43% increase in the capacity of renewable electricity already by 2022. According to IRENA (International Renewable Energy Agency) forecasts, the share of renewables will double by 2030.
The IEEFA report states that renewables have already undermined the traditional business model of utilities in those countries where electricity demand is stable or declining. But even where electricity demand is growing, such as in China and India, the use of coal-fired power plants has been impacted by renewables.
Thanks to an “early awareness of the need for a transition” in the energy market, today approximately half of the electricity that we produce comes from non-fossil sources, with 36 GW of installed capacity from hydropower, wind, geothermal, solar, biomass and cogeneration plants, which make us “one of the most important clean energy producers at a global level.” Zero-emission sources account for 46% of production (Sustainability Report 2016-2019). We aim to reduce greenhouse gas emissions by 25% by 2020 compared to 2007 and to zero them by 2050.
Our commitment to an increasingly sustainable model was recently recognised also by Fortune, which included us in the “Change the World” ranking, as the only utility and only Italian company among the top 50 companies that are improving the life of the planet from a social and environmental point of view. Last September – for the 14th year in a row – Enel was included in the Dow Jones Sustainability World Index (DJSI World). In addition, before the summer, the FTSE4Good index recognised the sustainability of our policies, practices and procedures giving us an overall score of 4.6/5 in the environment, social and governance areas.
Investments in 2017
The IEEFA report analyses our Group’s ability to grow in the world, especially in Central and South America, with major investments in renewables in Chile, Mexico, Brazil, Peru and Argentina. Through Enel Green Power, we are the largest “green” operator in Mexico in terms of installed capacity with 675 MW in wind power and 53 MW in hydroelectric power. These will soon be joined by 754 MW at the Villanueva solar park, which is currently under construction and will be the most important photovoltaic plant in the Americas.
“Enel is a leader in the sustainable development of Mexico, where our creating shared value approach for all our stakeholders in the world is working very well,” stated Paolo Romanacci, Renewable Energies Manager in Mexico and Central America.
In Chile, we have an installed renewable energy capacity of about 1.1 GW, mostly in wind and solar energy, to which we have recently added Cerro Pabellon, South America’s first geothermal plant and the world’s first located at over 4,500 metres above sea level. Cerro Pabellon was built by applying the Creating Shared Value model, generating value and new sustainable production chains with and for local communities.
Lapa, the largest solar park in Brazil, with an installed capacity of 158 MW, started production in June. “This project will produce the energy needed by this area of northeastern Brazil, which is currently experiencing a severe drought,” commented Carlo Zorzoli, Enel Country Manager in Brazil.
Recently, Enel Green Power started the construction of Wayra I, its first wind farm in Peru.
“Our goal in Peru is to become a leading operator in the production of renewable energies, which we consider to be fundamental for sustainable development at a local and national level,” said Antonio Cammisecra, CEO of Enel Green Power. Once completed, Wayra I will have a total installed capacity of 132 MW and will become the largest wind power plant in the country.
In Africa, in April 2017, we signed a 25-year power supply agreement with Zesco, the State-owned utility of Zambia, for the construction of the Ngonye1 photovoltaic facility (34 MW). This year, two solar installations in South Africa, Adam and Pulida (82.5 MW), went into operation, in addition to the three existing ones, Paleisheuwel (82.5 MW), Tom Burke (66 MW) and Upington (10 MW), and to the two wind farms, Nojoli (28 MW) and Gibson Bay (11 MW).
In North America, production has started at our largest wind farm, Cimarron Bend (400 MW) in Kansas (USA), where we are present with other four plants - Caney River (200 MW), Smoky Hills I and II (combined 250 MW) and Buffalo Dunes (250 MW) - which will soon be joined by the Thunder Ranch wind farm in Oklahoma (300 MW) and Rock Creek (300 MW) in Missouri. In the United States and Canada, Enel Green Power has a combined installed capacity of 3.3 GW in renewables.
In April 2017, we also entered the Australian market with the acquisition and the start of construction of Bungala Solar One (137.7 MW).
“This project marks the first step in our growth strategy in a country that boasts a wealth of resources and a growing capacity in renewables in the coming years,” said Antonio Cammisecra. The construction of the second part of the plant, Bungala Solar Two, is expected to begin by the end of 2017, while the 275-MW plant will enter into operation at the beginning of 2019.
Even the choice of adopting smart meters is considered by the IEEFA report as a move ahead of many other utilities and places our Group among the world’s most cutting-edge companies in the industry.
Our industrial strategy was inspired by the 17 Sustainable Development Goals in the UN 2030 Agenda, basing it on pillars such as sustainability, innovation, digitalisation and the reduction of CO2 emissions in the production mix. This does not translate only into investing heavily in renewable energy, but also into evaluating every single project with a view to Creating Shared Value, from the initial phases, weighing the impact on resources, communities and the environment.