Italian energy group ERG SpA (BIT:ERG) will be unable to finalise the sale of its only thermal power plant in Italy on competition grounds, after the antitrust regulator last week crushed its hopes of becoming a wind and solar company only by the end of the year.
Italy’s antitrust authority AGCM on Friday gave a no-go to ERG’s agreed sale of the 480-MW Priolo Gargallo combined-cycle gas turbine (CCGT) cogeneration plant in Sicily to Italian utility Enel SpA (BIT:ENEL), which would have helped ERG dispose of its last asset generating power from non-renewable sources.
AGCM’s investigation found that the acquisition of the plant by Enel Produzione SpA “would lead to the creation and the reinforcement of a dominant position on the buyer’s part that would eliminate or reduce in a substantial and long-lasting way the competition in the relevant markets,” ERG said.
The regulator’s decision will now force ERG to look into “the most efficient alternative path” to realise its goals under the 2022-2026 business plan, which was to see the company dispose of the CCGT plant and pile 2.2 GW of renewables on top of 2.5 GW of wind and solar already installed by the end of the planning period.
"We were surprised by AGCM's failure to approve the transaction, also given the industrial set-up of the plant, whose production is mainly tied to the Priolo industrial site through long-term contracts,” commented ERG CEO Paolo Merli. “In light of what has emerged, we will evaluate the possible options to valorise the asset as best we can while confirming the growth targets in our Industrial Plan.”
Choose your newsletter by Renewables Now. Join for free!