Eni and Enel receive energy support as EU funds REPowerEU
What exactly is the REPowerEU scheme?
Understanding the impact that global tragedy has on the overall energy supply across nations, the European Union (EU) is looking to address disruption to help the industry recover through loss of energy supply, which increases the cost-of-living for consumers.
The EU has taken on major responsibilities to drive down continental dependency on Russia’s energy supplies while saving energy, reducing emissions, and minimising overall costs for a number of energy resources.
This regime is benefitting some of Europe’s most crucial energy providers, particularly in Italy where Eni and Enel—along with other Italian energy groups—will begin to see the benefits of these funds.
"We believe this transfer along with a further extension to the deadline, if successful, would lead to more investments flowing through to Italian companies where the government has a significant stake, such as Eni, Enel, Snam, and Terna, and allow for a more rapid and efficient investment cycle," the credit agency DBRS says.
Energy support lacking post global disruption
Until now, energy firms in Italy received relatively small amounts from the EU post-COVID funding with €1bn and €3.5bn awarded to the country’s energy grid operator Terna, and Enel—the largest utility provider in the country. Enel is a key player in a number of further initiatives, such as electrification where its subsidiary Enel X Way is making waves in the electric vehicle (EV) charging sector.
The funds awarded to the top businesses in the Italian energy sector are said to grow revenues and allow companies to recover from global disruption—hopefully with an emphasis on renewable adoption. The country hopes to gain a further €6bn from the REPowerEU scheme with a further addition of €3bn from national funds.
Key successes of the REPowerEU scheme
The EU has seen a few areas of success due to the urgent demand for disruption relief across Europe. The organisation supports state-backed businesses in replacing 80% of Russian energy supplies in just eight months and reduced consumption by 20% in the process.
From a cost perspective, the scheme helped put a cap on energy sources gas and oil and doubled the number of renewable energy projects in place since the war began. Through significant diversification, the EU is now leveraging more in terms of liquefied natural gas (LNG) and non-Russian suppliers, totalling 91% of its overall energy consumption.
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