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Enel and Sardinia sign protocol on renewables

Italian utility Enel and the region of Sardinia have signed a protocol of understanding to foster the development of renewables and ensure an abundant supply of power at competitive prices to strategically important enterprises that operate on the island.

As part of the agreement, Sardinia has agreed to issue Enel with all authorizations needed to expand existing wind plants or build new wind facilities for a total capacity of 160MW, within 90 days of the protocol’s signing.

According to Enel, the construction of the new wind plants, which will be carried out within industrial areas or other areas to be selected on the basis of the regional landscape plan, will avoid the emission of about 190,000 metric tons of carbon dioxide and the consumption of 56,000 metric tons of oil equivalent per year.

The development of renewable energy resources is part of a more than E4 billion investment plan that Enel hopes will advance its global position in the search for innovative solutions to reduce the environmental impact of the generation and distribution of electricity.

Enel has agreed to provide 550GWh of energy per year at a price of E40 per MWh – a total annual value of E22 million – to large-scale power users that undertake new investments and do not benefit from subsidized rates.

The power, which will be provided for four years using procedures agreed with the competition authority and the authority for energy and gas, is broadly equivalent to the output of Enel’s wind power facilities in Sardinia. This is the 100MW currently installed, and the 160MW that is part of the protocol.

Enel will also develop a plan for the removal of retired power line infrastructure and pursue a number of initiatives to improve service quality for Sardinia’s industrial areas. Sardinia will make a one-off contribution of E5 million to these works. Enel and Sardinia have also agreed on a joint project to develop intelligent electricity distribution networks, known as smart grids.

Enel has also agreed to sell Sardinia its two hydroelectric plants at Busachi, with an installed capacity of 21.2MW and 4.2MW, respectively.

By Clare Watson

Energy Business Review

6 July 2007