Universal Registration Document 2021

1.4.5.2.3.1 Electricity generation

In Italy, as of 31 December 2021 Edison’s installed capacity amounted to 6.4GW, with net electricity production of 17.4TWh in 2022, a decrease of almost 7.3% from the 2020 figure.

Based on power generation data for 2020 ⁽¹⁾, Edison is the third-largest producer at the national level. Its net power output in Italy accounted for around 6.3% of net Italian electricity generation.

Edison’s generation fleet (excluding Fenice) is currently made up of 98 hydropower plants, 14 thermal power plants, 50 wind farms and 64 photovoltaic plants. Combined-Cycle Gas Turbines account for 73% of electricity generation, while hydropower accounts for 15% and combined wind and other renewable energies 12%.

The decrease in Edison’s production is due mostly to the fall in thermal power production (12.8TWh, down 7.8% on 2020), itself due mostly to the shutdown of two power plants for maintenance activities and because of breakdown).

In 2021, Edison’s hydro power output totalled 2.7TWh. The decrease of 16.8% compared to 2020 is mainly due to the deconsolidation of Dolomiti Edison Energy Srl as of 1 July 2020 and a decrease in hydraulicity in 2021.

Wind power and other renewable energy production amounted to 2.0TWh (up 14.2% on 2020) in 2021. This increase is attributable to the change in the scope of consolidation related to the acquisition of Futuren and the commissioning of facilities that have been completely rebuilt (Integrali ricostruzioni) in Abruzzo and Apulia.

In order to guarantee the flexibility and security of the national electricity system, Edison continued the construction of the Marghera Levante (780MW) and Presenzano (760MW) CCGT plants, launched in 2019 and 2020 respectively. These two installations are highly flexible and efficient (with energy efficiency of 63%, have a low environmental impact (with CO₂ emissions 40% lower than the national average and 70% fewer NO_x emissions). Power generation should begin in 2022 and 2023 respectively. The two power plants should benefit from the fixed contribution of €75,000/MW for 15 years linked to the capacity market, with a positive impact on the volatility of Edison’s margins, subject to the commissioning date deadlines being met.

In February 2021 ⁽²⁾, Edison finalised the agreement with F2i (Fondi italiani per le infrastrutture) to acquire a 70% stake in E2i Energie Speciali. This company, a leader in the wind power industry in Italy, was already 30% owned by Edison.

In December 2021, Edison announced the signing of an agreement with Crédit Agricole Assurances to become the financial partner of Edison Renewables through a 49% share. Edison retains control over the business and governance of the company. This long-term collaboration will enable Edison to accelerate its investments in renewable energy in Italy, and implement its portfolio of projects. It will thus enable it to contribute to the country’s energy transition ⁽³⁾.

Internationally, Edison is well-established in Greece, where it owns a 50% stake in ElpEdison SA, one of the country’s main electricity operators. It owns two CCGT plants: one in Thessaloniki (426MW) and the other in Thisvi (410MW) built by Edison, which sells electricity on the residential market.

Last, Edison holds a 50% stake in Ibiritermo, a subsidiary in Brazil, which operates a 226MW CCGT plant, and 20% stake in Kraftwerke Hinterrhein AG, which operates 626MW of hydropower in Switzerland.

1.4.5.2.3.2 Gas business

For the implementation of its gas strategy, the EDF group, through Edison, benefits from experience along the entire value chain of natural gas. Edison’s Italian gas supply portfolio is based mainly on a series of long-term agreements. As of the end of 2020, these covered:

• approximately 12.7 billion cubic metres of imports via gas pipelines and LNG from Libya, Qatar, Azerbaijan and Algeria;
• 2 billion cubic metres bought on the market, through short-term contracts, or produced in Italy or Algeria.

In 2021, total sales of gas in Italy amounted to 18.9 billion cubic metres (compared with 16.6 billion cubic metres in 2020). Edison delivered 5.8 billion cubic metres of gas to the industrial sector, 2.0 billion cubic metres to the residential sector, 5.0 billion cubic metres to the thermoelectric sector (including Edison’s own requirements), 6.0 billion cubic metres on the wholesale market, and 0.1 billion cubic metres of sales of production abroad.

In January 2021, Edison, Tenaris and Snam signed a letter of intent to launch a project to decarbonise Tenaris’ steel plant in Dalmine. The project looks to generate hydrogen and oxygen through an electrolyser that will be installed on-site and to adapt the steelmaking process to use green hydrogen instead of natural gas.

In September 2021, Edison signed a memorandum of understanding with other operators for the joint development of the Puglia Green Hydrogen Valley project, to become one of the first large-scale green hydrogen production and transmission initiatives in Italy. The project proposes to build three green hydrogen production plants in Brindisi, Taranto and Cerignola (Foggia) powered by photovoltaic generation. The green hydrogen will be used mainly by industries in these regions, but will also be injected into the local gas network and/or used for sustainable mobility.

Gas infrastructures

Edison contributes to the development of gas import infrastructure projects through IGI Poseidon which Edison owns a 50% stake (see section 1.4.6.2.2.2 “Infrastructures”).

IGI Poseidon is promoting the following three projects:

• Eastmed, an interconnection between Greece and the eastern Mediterranean which will provide direct access to gas resources in the eastern Mediterranean (Israel, Cyprus), connecting them to the Greek, Italian and other European The project is based on a 10bcm/year offshore/onshore line, expandable up to 20bcm/year, whose viability and sustainability have been demonstrated from a technological and economic point of view by an extensive array of studies and engineering surveys carried out since 2014. The strategic relevance of the project has been largely confirmed by the 2020 intergovernmental agreement and by the Greek government granting the project the status of national importance and public utility. The project is in the final stage of development, so it may be ready for an investment appraisal in 2022;
• Poseidon, an interconnection between Greece and Italy, which will allow available gas resources to be transferred from Greece to Italy by connecting to The project is a mature asset with finalised engineering activities and has obtained the required permits in Greece and Italy. In May 2020, it was declared a project of national importance for Greece;
• IGB, a gas pipeline belonging to ICGB, in a 50/50 partnership with Bulgarian Energy Holding, connecting Greece and Construction started in December 2019 and commercial operation is due to start in the first half of 2022. The project benefits from an exempted regulatory regime issued by the national regulatory authorities. It has been approved by the European Commission. The gas pipeline, now over 70% complete, will be 182km long and have a transmission capacity of 3 billion cubic metres per year.

These projects are among the European Commission’s Projects of Common Interest, and benefit from EU aid: IGB has received €84 million for its construction. Eastmed will receive a matching contribution from the European Commission covering 50% of its development costs (i.e. about €37 millions).

Edison also has the right of use of 80% of the Rovigo offshore regasification terminal’s capacity (6.4 billion cubic metres per year) where LNG imported from Qatar with Ras Laffan Liquified Natural Gas Company Limited II (RasGas II) is regasified.

Concerning LNG, since 2018 Edison has been engaged in the “small-scale LNG transportation” project for the development of an LNG marketing supply chain, with the aim of helping to reduce emissions by maritime and road transport. The project led by Depositi Italiani GNL (owned 30% by Edison ⁽⁴⁾) comprises the construction of an onshore depot at the port of Ravenna where the LNG will be stored at a small, dedicated LNG terminal. The facility, which is now complete, has a capacity of over 1 million cubic metres of LNG per year (Edison will have right of use to 85% of its capacity). It will be able to supply LNG to 12,000 trucks and up to 48 ferries.

The LNG marketing activity started in November for wholesale customers.

In October 2020, Edison and Kuwait Petroleum Italia (Q8) presented a joint project for the construction of an onshore deport at the port of Naples. This project is subject to the granting of a permit.

In March 2021, Edison started the permitting process for the construction and operation of the Brindisi coastal storage facility. The approval in principle required under the Seveso Directive has been obtained.

(1) Data published by the ARERA (ARERA report, vol. 1, p. 88, fig. 2.1); 2021 data will be released in mid-2022.

(2) See Edison’s press release of 16 February 2021.

(3) See Edison’s press release of 3 December 2021.

(4) A 19% stake is held by Scale Gas Solutions (a company controlled by Enagas), and a further 51% stake by Petrolifera Italiana Rumena.