LNG

Italian utility Enel Group reported a drop in first-half revenues of almost 18 percent amid falling prices and lower volumes sold, though net income increased.

Enel revenues declined to €38.73 billion in the six months from €47.09Bln, a drop of 17.8 percent from the first-half of 2023.

Enel is involved in natural gas and thermal energy markets in Italy, Spain and in South American nations such as Argentina, Chile, Colombia, Brazil and Peru.

The group’s natural gas sales amounted to 4.1 billion cubic metres in the first half of 2024, a decrease 18 percent, or 0.9 Bcm in the same period of 2023.

The net electricity generated by the Enel Group in the first half amounted to 96.74 terawatt hours (TWh), a decline of 5.3 TWh on the same period of 2023.

 Market context

“The change is mainly attributable to the market context with declining prices alongside lower energy volumes from thermal sources and a decrease in quantities of electricity sold on end-user markets,” Enel explained.

“These effects were partly offset by an increase in revenues from the sale of electricity generated by renewable sources and from the management activities of distribution networks,” stated Enel.

The utility’s ordinary gross earnings increased by 8.8 percent to €11.68Bln from €10.74Bln in the first half of 2023.

“The increase is attributable to the positive contribution of the integrated businesses, driven by the excellent performance of renewable energy, which more than offset the decrease in the margin recorded in end-user markets and thermal generation,” Enel explained.

Net income

The group’s ordinary net income surged by over 20 percent to €3.95Bln from €3.28Bln in the prior-year period.

“In the first half we achieved excellent results, driven by significant organic growth reached through the strict implementation of the pillars of our Strategic Plan,” said Enel Chief Executive Flavio Cattaneo.

“The managerial actions undertaken have already allowed us to restore sound operating cash flow generation and reduce our financial debt to around €55Bln, also taking into account the transactions currently being finalized and already announced to the market, therefore reaching one of the lowest levels of leverage in the entire sector,” Cattaneo stated. 

The Federal Energy Regulatory Commission has introduced reforms to ensure the US transmission grid can meet the nation’s growing demand for reliable electricity with a new rule that outlines how to plan and pay for facilities that regions of the country will need to keep the lights on and power the American economy through the 21st Century.

The US Federal Energy Regulatory Commission has announced a special meeting on May 13 to consider its long-awaited electricity transmission reform proposals that will affect energy markets across America.

The reforms have been considered since severe storms in states from North Dakota to Georgia struck in the Christmas of 2022. This followed an earlier major winter storm in Texas that caused power outages in the Southeast.

The Transmission Reform meeting begins at 11am on May 13 in the Commission Meeting Room at the FERC’s Washington, D.C. headquarters.

FERC has proposed a set of regulatory reforms to speed a much-needed expansion of the nation’s network of long-distance electric transmission lines.

FERC’s final rules, which are now set to be debated, are expected to substantially update the framework under which transmission lines are planned and paid for, and pave the way for the growth of clean energy.

Analysts noted that the FERC’s reforms come at a time when the future of the electric grid has become the focus of partisan debate and legal challenges to FERC’s proposed rules are expected.

Power demand surge

Electricity demand in the United States is expected to grow dramatically over coming decades, by some estimates tripling before 2050.

This is because under current US plans, from cars to home heating, there will be a move to the use of more electric power.

Accompanying this demand will be a fundamental shift in how electricity is produced, with renewable energy becoming an ever-larger portion of the generation mix.

Both of these trends to more and cleaner power will require simultaneous expansion of the network of long-distance transmission lines to reliably deliver power to consumers.

Yet despite clear need, relatively few miles of new transmission have been built in recent years.

At the core of the challenge are outdated frameworks for how the grid is planned and paid for.

In addition, the future of the electric grid has become the focus of political debate, turning what was once primarily an engineering challenge into a political one.

“One factor at play here is that the utility industry wants to make sure that the system is developed for its own needs, which don’t necessarily align with broader decarbonization goals or the interests of consumers in having low-cost power,” said one study filed with FERC.

While LNG imports to Japan rose last month to 6.53 million tonnes, the thermal coal purchases by the world’s largest LNG importer were even higher at 9.19 million tonnes, raising concerns among Japanese officials that coal will lead to embarrassment on the Kyoto Protocol on greenhouse-gas emissions.

South Korean power operators have seen the cost of coal-fired power increase to narrow its differential with liquefied natural gas and because of its environmental burden, thermal coal can no longer be regarded as a cheap option in Asia.