Italian Power Market
In the generation market, a dash for gas is replacing swathes of old and inefficient capacity with state of the art combined cycle plants. Enel, once overwhelmingly dominant, is losing ground to a host of new players and now accounts for less than half of the country’s output.
In the supply market, all business customers have been free to choose their suppliers since July 2004. Household customers will be freed in July 2007. Both established players and new entrants are competing for customers harder than ever before.
And yet the market is beset with weaknesses and plagued by controversies, from network congestion to allegations of trading market manipulation.
This 97 page report presents a comprehensive analysis of system fundamentals, the booming project market, the gas industry, the policy issues, the trading business, and leading companies. Market and industry indicators are also provided in 48 tables and 25 charts. The report is structured as follows:
Chapter 1 – The Italian Power System: this chapter reviews the fundamentals of the Italian power industry. First, historic and projected consumption by sector are covered. Next it reviews production and capacity, focusing on the rise of natural gas and the decline of fuel oil. The last section reviews network operations at the cross-border and domestic levels. Network improvement projects – a crucial issue for industry stakeholders – are covered in detail.
Chapter 2 – Power Projects: this chapter assesses the booming conventional thermal project business in Italy. It covers both projects under construction and proposed projects. The scale of the boom is measured, the leading developers are identified, and details on all projects over 200 MW are presented. The project details include the names of the developers, the locations, the capacity of each project, and expected completion dates.
Chapter 3 – The Italian Gas Industry: since natural gas is so important to Italian power market stakeholders, this chapter presents a detailed review of the country’s gas industry. It covers domestic production, consumption, imports, existing and planned infrastructure, market opening, trading, and leading players.
Chapter 4 – Power Policy: this chapter covers the liberalisation of the Italian power market. First it reviews the players in the crowded field of energy regulation and policy development. Next it presents the market opening laws of 1999 (the Bersani decree), 2004 (the Marzano law), and current discussions of further legislation. The aims of these laws are then measured against practical progress, drawing on the assessments of regulatory officials and industry stakeholders. The chapter then moves on to environmental policies, focussing on CO2 emissions, the promotion of renewables, green certificates, and energy efficiency. Finally, the single buyer and network management policy are reviewed.
Chapter 5 – The Trading Market: this chapter profiles the Italian power trading market. First the Italian Power Exchange – the centre of today’s trading business- is reviewed. Next the chapter examines OTC trading, single buyer auctions, CIP6 auctions and cross-border trading.
Chapter 6 – Company Profiles: this chapter reviews important players in the Italian power market. A detailed profile of Enel comes first. The generation companies – or “gencos” – which Enel was forced to divest under Italian market opening legislation are covered next. Reviews of foreign utilities operating inside the Italian market, industrial groups with power interests, municipal utilities, and domestic new entrants follow. The chapter concludes with data tables presenting operating and financial information about Italian power market players.
Chapter 7 – A Liberal Path: this chapter sketches a far-reaching reform programme that could complete Italy’s difficult transition from monopoly to market.
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