Italy's Enel To Press Ahead With Nuclear Plans
Author: Stephen Jewkes
Enel SpA will press ahead to launch nuclear power in Italy as part of a 31 billion euro ($43.22 billion) spending budget in the next five years, the Italian utility said in a business plan on Tuesday.
Presenting its 2011-2015 business blueprint in London, Enel said it would improve its energy mix in Italy by developing nuclear power, along with clean coal and liquefied natural gas.
Nuclear costs for operators in Europe and elsewhere are expected to rise and their plans be delayed after the escalating damage to reactors in Japan after last week's earthquake and tsunami.
Enel has agreed with France's EDF to develop four reactors in Italy. Enel has 3,500 megawatts of nuclear capacity in Spain and 1,800 MW in the Slovak Republic, rising to 2,800 MW by end-2015.
The center-right government of Prime Minister Silvio Berlusconi vowed to relaunch nuclear power in Italy after it was banned in 1987. A referendum on nuclear plant building this year may derail the plans.
As part of its nuclear expansion, Enel plans to spend 2.7 billion euros to complete work at its Mochovce plant in Slovakia.
Enel, Europe's most-indebted utility after it bought Spain's Endesa for about 40 billion euros, said it would cut its debt through cash from operations and not from disposals.
In 2010 Enel sold some assets to cut its debt and secure its credit rating. It included the sale of a minority stake in renewable unit Enel Green Power in what was Europe's biggest initial public offering for the year.
Core earnings are expected to rise to 20 billion euros in 2015 from 17.5 billion euros in 2010.
Italian investment bank Mediobanca said in a research report that the plan was broadly in line with its expectations. Mediobanca confirmed its "outperform" rating on the stock.
The shares were down 0.88 percent at 4.044 euros at 0830 GMT as the STOXX Europe 600 utilities index was down 1.3 percent.
Enel confirmed its dividend policy of paying out 60 percent of net earnings.
Enel also said it had agreed to sell its Bulgarian assets for 230 million euros to U.S. fund ContourGlobal LP in a sale that had been originally set for 2010. Lazard Ltd advised ContourGlobal on the deal.
(Editing by Will Waterman)