'New industry benchmark' | Enel Green Power adds record 5.1GW renewables in 2021

Enel Green Power (EGP) has added a record 5.1GW in renewable energy capacity last year, but despite its massive scope and reach the Italian renewables major sticks to its rejection of building offshore wind farms.

That is almost two thirds more than the 2GW in new renewables capacity the utility had added in 2020.

The new installations, which for the first time include 220MW of battery capacity, bring EGP’s managed renewables capacity to 54GW.

"In 2021, Enel Green Power set new records in its growth which, despite the difficult conditions brought about by the Covid-19 pandemic, continues at full speed while ensuring safety remains at the heart of our activities," EGP chief executive Salvatore Bernabei said.

"These results represent a new benchmark for the industry … Indeed, we operate the world’s largest private renewable generation fleet.”

“I guess it’s a question of time,” Starace then said.

But that time still doesn’t seem to come soon, Bernabei made clear.

“We think that offshore (wind) compared to other alternatives like onshore wind or PV has a higher time to develop,” Bernabei said.

“You can consider from seven to 10 years since you start your initial search for seabed rights, seabed concessions until the operation of the plant,” he said, adding that despite lengthy lead times, developers in offshore wind have to pay large amounts of money even before construction, for example for seabed leases.

“On the other hand, the Capex, the cost of construction of these projects, is much higher, twice than for onshore wind for instance. Opex also, the operational expense, is higher, (and) the risk is also bigger.”

To reach economies of scale, developers are increasing the size of offshore wind projects year after year, which ties up large amounts of investments on single projects, a strategy EGP previously has applied to, for example, large hydro projects as well, but is no longer willing to do, Barnabei explained.

As his company has alternatives that can be built with a lower levelised price of energy (LCOE), need less time for construction and are less risky “we don’t understand why we should enter into offshore, sincerely,” Bernabei emphasised.

“It is true that offshore has an average higher load factor compared to PV and onshore, but it is also that the revenues of these plants are going down sensibly since the start of the industry.

“So, we don’t see how it could be economically convenient for us compared to the alternatives that we have.”

The renewed and strong rejection of offshore wind may come as a disappointment to Italy, a latecomer to offshore wind due to the mostly deep waters of the Mediterranean. The government last year had started to meet with companies to discuss possibly synergies from the construction of clusters of wind farms in the waters surrounding the country.

The capacity built by EGP in 2021 included 2.6GW of onshore wind plants, and 2.2GW of solar. The highest volume of capacity was added in Latin America, with 1.95GW, followed by North America (mostly in the US) with 1.36GW, and Europe (mainly Spain and Italy) with 832MW. EGP installed another 754MW in Africa, Asia and Oceania.