Enel Green Power intends to add some 5.8GW in new renewable energy capacity this year, nearly double the record 3,106MW added in 2020.
New capacity growth this year is expected to be led by South America, particularly Brazil and Chile, Salvatore Bernabei, the CEO of Enel Green Power (EGP) said in a briefing with journalists. Other counties featuring in growth plans this year for EGP, the renewables arm of Italian utility Enel, are the US, where the company expects to add about 1GW in green energy and Spain, where it is targeting over 700MW. EGP also anticipates a combined 1.3GW of new capacity in South Africa and India.
In 2020, EGP brought 46 new renewable facilities online, with 2,284MW in new wind farms and 803MW in solar. Almost all new capacity will continue to be in wind and solar, Bernabei said. While the breakdown between the two technologies may vary from year to year, over time new capacity is expected to be roughly equally divided between the two technologies.
In geographical terms, EGP capacity in 2020 increased 508MW in Europe, mainly in Spain; while 879MW was added in Latin America, led by Brazil; and 1,386MW in North America, led by the US market. In Africa, Asia, and Oceania, 333MW in capacity was built.
With the 3,106 MW built in 2020 — up by 77MW, or 2.5%, on the previous new capacity record set in 2019 — EGP now manages around 49GW of total renewable capacity. It is targeting to reach 145GW by 2030, of which 120GW will be owned capacity and 25GW operated but not owned by the company.
EGP also repowered about 1.2GW of renewable plants in 2020, including 250MW in wind farms and 847MW in hydroelectric facilities. It is targeting a further 1GW in 2021, once again primarily in hydroelectric plants.
Bernabei expects new opportunities could open for EGP in the US under Joe Biden’s presidency, although renewables have grown strongly over the last 15 years — even under the administration of Donald Trump — largely on the back of supportive policies by US states. “We have an already ambitious plan, so I won’t be saying we will be changing it, but the outlook is more positive,” said Bernabei, pointing to possible new business for the company with electromobility and commercial & industrial (C&I) power purchase agreements (PPAs).
Within Europe, Italy will also continue to be a focus for growth, although Bernabei noted that the undersubscribed joint solar and wind auction held on 26 January made clear that the permitting process in the country needs to be accelerated.
Enel secured contracts for two Italian wind farms totalling 34.5MW but less than a quarter of the 1,161MW of total capacity on offer was awarded in the auction. “There is a huge difficulty in getting projects approved in Italy,” he said.
EGP is also turning its attention to developing renewable projects in Romania, where — as in other markets — the company will be looking at the possibility of combining battery storage with wind and solar projects.
Bernabei said the company was not concerned about the arrival of oil majors in the renewables space. He noted that the combined renewable-energy investment commitments made by big renewable companies and oil majors to 2030 only add up to about one fifth of the new capacity that will be needed in Europe by thatyear. “There’s plenty of room for everyone,” he added.
While EGP has yet to invest in offshore wind, this could potentially be on the agenda in the future. “The time to [profitability] for offshore wind farms has historically been long, but that has come down, as has Capex,” he noted. At the same time, the levelised cost of energy of offshore wind farms is still running at about twice that of onshore wind, he said. “We don’t know if we’ll enter offshore wind, but we maintain a continuous scouting of activities and technologies.”