Italy Power Report

Providing expert analysis, independent forecasts and competitive intelligence on the power.

Report includes: BMI Industry View, Industry SWOT Analysis, Industry Forecasts, BMI's Petrochemicals Risk Reward Index, Economic Forecasts, Company Profiles and Global, Regional and Country Industry Overviews.

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Italy Power Report
Product Price
$1,295.00

BMI View: Non-hydropower renewables a nd transmission networks will see most i nvestment within Italy's power sector over the coming years, due to planned incentives for non-PV renewable s and a growing focus on the development of new cross-border power interconnection s . Amid falling wholesale power prices and stagnant power consumption growth, continued d elays in the introduction of a capacity market will encourage thermal power utilities to retire unprofitable assets and consolidate.

Headline Power Forecasts (Italy 2015-2021)
2015e 2016f 2017f 2018f 2019f 2020f 2021f
e/f = BMI estimate/forecast. Source: Terna, EIA, GSE, BMI
Generation, Total, TWh 281.647 281.705 281.631 281.963 282.423 283.013 283.696
Consumption, Net Consumption, TWh 292.2 291.6 290.1 288.7 287.8 286.4 285.2
Capacity, Net, MW 115,971.9 111,400.4 109,016.1 108,939.4 109,311.9 109,876.7 110,847.4

Latest Updates And Structural Trends

  • Cheaper natural gas will boost Italy's spark spread in 2016, but will reinforce the problems facing the country's thermal power sector in 2017 as the lower price of gas is pushing forward power prices lower. Faced with this challenging operating environment - which will be compounded by contracting power consumption and delays to the introduction of a capacity market - utilities will continue to retire excess thermal power capacity and consolidate, to cut costs and improve efficiency. The European Commission (EC) is reviewing capacity markets mechanism in Europe, with guidelines on the scheme's implementation reportedly scheduled to be released by end-2016.

  • Utility A2A has been most active in the consolidation trend. In January 2016 it acquired utility Linea Group Holding, and in November 2015 it reached an agreement with Sorgenia on the shared management of two combined-cycle gas turbine (CCGT) power plants for five years. We expect the company to continue with the acquisition of smaller municipal utilities in the north of Italy, in line with its plan to create a new company that will integrate its CCGT assets with those of all its subsidiaries.

  • Data released by Terna on Italy's power consumption showed power demand in the country grew 1.5% in 2015, in line with our estimate. It is the first time that power consumption in Italy expands since 2011, but we believe this will not be the start of a trend. Growth in power demand in 2015 was due to unseasonably hot weather, while structural dynamics in the Italian economy and power sector suggest consumption of electricity in Italy will resume its slow contraction over the next few years.

  • A regulation from the Ministry of Economic Development (MiSE) which will extend existing incentives to new non-photovoltaic (PV) renewables capacity until December 2016 has yet to enter into force: the bill was still being reviewed by the European Commission at the time of writing. According to the MiSE regulation, the government funding ceiling for non-PV projects will remain capped at the current level of EUR5.8bn (USD6.5) until December 2016. However, a revision in the method of accounting for the incentives already allocated to plants yet to be built is expected to free up resources to incentivise the development of additional capacity.

  • Market players had feared delays in the final approval of the MiSE regulation by the EC would mean the ceiling to incentives would be reached before the new accounting rule was applied, but this hasn't been the case so far. As for data released by Gestore Servizi Energetici (GSE) in January 2016, cumulative funding for the period was EUR5.65bn.

  • There is growing political support for the development of a submarine and onshore transmission line that will connect the power systems of Italy and Montenegro. The project has support from the EU and European Bank for Reconstruction and Development (EBRD), will be carried out by Terna and is expected to be completed by end-2017.

BMI Industry View
7
Table: Headline Power Forecasts (Italy 2015-2021)
7
SWOT
9
Industry Forecast
11
Italy Snapshot
11
Table: Country Snapshot: Economic and Demographic Data (Italy 2015-2019)
11
Table: Country Snapshot: Economic and Demographic Data (Italy 2020-2025)
11
Table: Country Snapshot: Power Sector
11
Italy Power Forecast Scenario
12
Electricity Generation And Power Generating Capacity
12
Table: Total Electricity Generation Data And Forecasts (Italy 2014-2019)
22
Table: Total Electricity Generation Data And Forecasts (Italy 2020-2025)
22
Table: Electricity Generating Capacity Data And Forecasts (Italy 2014-2019)
23
Table: Electricity Generating Capacity Data And Forecasts (Italy 2020-2025)
24
Electricity Consumption
25
Table: Total Electricity Consumption Data And Forecasts (Italy 2014-2019)
26
Table: Total Electricity Consumption Data And Forecasts (Italy 2020-2025)
26
Transmission And Distribution, Imports & Exports
26
Table: Italy's Recent Power Transmission Sector Developments
29
Table: Electric Power T&D Losses Data And Forecasts (Italy 2014-2019)
29
Table: Electric Power T&D Losses Data And Forecasts (Italy 2020-2025)
29
Table: Trade Data And Forecasts (Italy 2014-2019)
30
Table: Trade Data And Forecasts (Italy 2020-2025)
30
Industry Risk/Reward Ratings
31
NAWE Power Risk/Reward Index
31
Italy Power Risk/Reward Ratings
37
Rewards
37
Risks
37
Market Overview
39
Key Policies And Market Structure
39
Regulation And Competition
39
Pricing
41
Italy Power Projects Database
42
Competitive Landscape
44
Enel
44
Edison
45
Terna
45
Other Companies: Risk To Profits Will Encourage Thermal Power Consolidation
45
Company Profile
47
Enel
47
Regional Overview
53
NAWE Power Regional Overview
53
Glossary
60
Table: Glossary Of Terms
60
Methodology
61
Methodology And Sources
61
Industry Forecast Methodology
61
Sources
64
Risk/Reward Index Methodology
64
Table: Power Risk/Reward Index Indicators
65
Table: Weighting Of Indicators
66

The Italy Power Report features BMI Research's market assessment and independent forecasts covering electricity generation (coal, gas, oil, nuclear, hydro and non-hydro renewables), electricity consumption, trade, transmission and distribution losses and electricity generating capacity.

The Italy Power Report also analyses the impact of regulatory changes, recent developments and the background macroeconomic outlook and features competitive landscapes comparing national and multinational operators by sales, market share, investments, projects, partners and expansion strategies.

Key Benefits

  • Use BMI's independent industry forecasts for Italy to test other views - a key input for successful budgeting and strategic planning in the power market.
  • Target business opportunities and risks Italy's power sector through our reviews of latest power industry trends, regulatory changes, and major deals, projects and investments in Italy.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Competitive Landscape analysis.

Coverage

BMI Industry View

Summary of BMI’s key industry forecasts, views and trend analysis, covering power markets, regulatory changes, major investments, projects and company developments.

Industry SWOT Analysis

Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the power sector and within the broader political, economic and business environment.

BMI’s Power Forecast Scenario

Forecasts to end-2024 for all key indicators, supported by explicit assumptions, plus analysis of key downside risks to the main forecasts:

  • Generation: Electricity generation total, thermal, coal, natural gas, oil, nuclear, hydropower, hydro-electric pumped storage and non-hydropower renewables.
  • Transmission and Distribution Losses: Electric power transmission and distribution losses.
  • Trade: Total imports and exports.
  • Electricity Consumption: Net consumption.
  • Electricity Capacity: Capacity net, conventional thermal, nuclear, hydropower and non-hydroelectric renewables.

BMI’s Power Risk Reward Index

BMI’s Risk Reward Indices provide investors (power companies, service companies and equity investors) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors,

Market Overview

Structure, size and value of the industry sector; overview of the industry landscape and key players; an assessment of the business operating environment, sustainable energy policies, pricing and the latest regulatory developments.

Key Projects Database

Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by location, sector type, capacity, value, companies and operational status.

Competitive Landscape

Illustration of the power industry that exploits our data-rich, in-depth analysis of the leading players in the sector and examination of operational results, strategic goals, market position and the potential for investment.

Power Outlook long-Term Forecasts

Regional long-term power forecasts covering electricity generation, consumption and capacity for thermal, hydroelectric and nuclear power. These are supported by a country specific  overview, alongside an analysis of key downside risks to the main forecasts.

Regional Overview

Providing BMI’s near-term economic outlook for the region as a whole, as well as taking a close look at countries of particular interest and the latest trends and developments.

Sources

The Power Market Reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports, including Energy Information Administration (EIA), World Bank (WB) and United Nations (UN).