Infrastructure and Networks

484.6
TWh
ELECTRICITY TRANSPORTED ON ENEL’S DISTRIBUTION GRID
7,433
million
GROSS
OPERATING
PROFIT
3,937
million
CAPITAL
EXPENDITURE

Operations

Electricity distribution and transmission grid

Millions of kWh      
  2020 2019 Change
Electricity transported on Enels distribution grid(1) 484,605 507,738 (23,133) -4.6%
- of which Italy 213,615 228,143 (14,528) -6.4%
- of which Iberia 124,658 126,608 (1,950) -1.5%
- of which Latin America 130,958 137,296 (6,338) -4.6%
- of which Europe 15,374 15,691 (317) -2.0%
End users with active smart meters (no.)(2)(3) 44,292,794 43,821,596 471,198 1.1%

(1) The figure for 2019 reflects a more accurate measurement of amounts transported.
(2) To ensure a uniform comparison, the figure for 2019 has been adjusted on the basis of the new calculation method, which excludes digital meters with an active contract that are not managed remotely.
(3) Of which 18.2 million second generation smart meters in 2020 and 13.1 million in 2019.

In 2020, electricity transported on the grid decline (-4.6%), due generally to the COVID-19 health emergency. The impact on the various geographical segments is described below:

  • in Italy (-6.4%), the reduction in demand for electricity distribution concerned low-voltage customers for non-domestic uses (-5.7 TWh) as well as medium-voltage customers (-5.6 TWh). Demand also declined for electricity distributed to high-voltage customers (-3.0 TWh) and to other resellers (-0.2 TWh);
  • in Latin America (-4.6%), the change in volumes transported was seen mainly in Brazil;
  • in Europe (-2%), energy distribution declined in Romania in the business segment;
  • in Iberia (-1.5%), the decrease was essentially connected with the decline in demand.

AVERAGE FREQUENCY OF INTERRUPTIONS PER CUSTOMER

       
  2020 2019 Change
SAIFI (average no.)        
Italy 1.7 1.9 (0.2) -10.5%
Iberia 1.4 1.4 - -
Argentina 4.5 6.0 (1.5) -25.0%
Brazil 5.4 5.8 (0.4) -6.9%
Chile 1.5 1.6 (0.1) -6.3%
Colombia 5.6 6.8 (1.2) -17.6%
Peru 2.6 2.8 (0.2) -7.1%
Romania 3.4 4.1 (0.7) -17.1%

 

AVERAGE DURATION OF INTERRUPTIONS PER CUSTOMER

  2020 2019 Change
SAIDI (average min.)        
Italy 42.0 48.5 (6.5) -13.4%
Iberia 74.5 75.8 (1.3) -1.7%
Argentina 839.0 1,214.1 (375.1) -30.9%
Brazil 678.8 728.8 (50.0) -6.9%
Chile 171.2 184.1 (12.9) -7.0%
Colombia 466.6 666.6 (200.0) -30.0%
Peru 419.4 418.9 0.5 0.1%
Romania 134.5 169.6 (35.1) -20.7%

As shown in the tables above, service quality has improved in all geographical segments, although the SAIDI in Argentina remains high, due in particular to faults in high-voltage transmission systems not operated by the Group.

  2020 2019 Change
Grid losses (average %)        
Italy 4.9 4.7 0.2 4.3%
Iberia 7.1 7.5 (0.4) -5.3%
Argentina 18.9 15.5 3.4 21.9%
Brazil 13.4 12.8 0.6 4.7%
Chile 5.2 5.0 0.2 4.0%
Colombia 7.6 7.7 (0.1) -1.3%
Peru 8.8 8.2 0.6 7.3%
Romania 9.2 9.7 (0.5) -5.2%

The variations in grid losses are stable in all geographical segments except in Argentina, where the worsening of the economic crisis in the wake of the COVID-19 pandemic has produced an increase in fraud.

Performance

Millions of euro      
  2020 2019 Change
Revenue 19,342 21,789 (2,447) -11.2%
Gross operating profit 7,433 8,278 (845) -10.2%
Ordinary gross operating profit 7,714 8,228 (514) -6.2%
Operating profit 4,262 5,277 (1,015) -19.2%
Capital expenditure 3,937 3,905 32 0.8%

The following tables show a breakdown of performance by Region/Country in 2020.

Revenue

Millions of euro      
  2020 2019 Change
Italy 7,488 7,647 (159) -2.1%
Iberia 2,617 2,724 (107) -3.9%
Latin America 8,821 11,033 (2,212) -20.0%
- of which Argentina 647 1,166 (519) -44.5%
- of which Brazil 5,649 6,946 (1,297) -18.7%
- of which Chile 1,229 1,467 (238) -16.2%
- of which Colombia 601 641 (40) -6.2%
- of which Peru 695 813 (118) -14.5%
Europe 396 386 10 2.6%
Other 393 60 333 -
Eliminations and adjustments (373) (61) (312) -
Total 19,342 21,789 (2,447) -11.2%

 

Gross operating profit

Millions of euro      
  2020 2019 Change
Italy 3,824 3,906 (82) -2.1%
Iberia 1,890 2,025 (135) -6.7%
Latin America 1,579 2,259 (680) -30.1%
- of which Argentina 46 270 (224) -83.0%
- of which Brazil 871 1,144 (273) -23.9%
- of which Chile 156 222 (66) -29.7%
- of which Colombia 353 399 (46) -11.5%
- of which Peru 153 224 (71) -31.7%
Europe 135 107 28 26.2%
Other 5 (19) 24 -
Total 7,433 8,278 (845) -10.2%

The gross operating profit decreased:

  • in Latin America, and particularly in Brazil, due to the lower volumes transported as a result of COVID-19 and the unfavorable exchange rate developments, as well as in Argentina due to the effect of the recognition in 2019 of the Edesur settlement with the Argentine government, which resolved reciprocal pending disputes arising from 2006 to 2016 (€209 million);
  • in Iberia, following the reduction in energy revenue due both to a reduction in quantities sold and to the application of new remuneration parameters that went into effect for the 2020-2025 regulatory period, and to the recognition of provisions related to early retirement incentive plans following the amendments made to the agreement on the voluntary suspension or resolution of employment contracts (€315 million). These effects were only partially offset by the change in the electricity discount benefit (€269 million) following the signing of the 5th Endesa Collective Bargaining Agreement, which led to the partial reversal of the provision;
  • in Italy, due mainly to reduced margins recognized as a result of a decrease in volumes transported as a result of COVID-19 and to the indemnity received in 2019 in relation to the sale of Enel Rete Gas (€50 million). These effects were partially offset by an increase in gains for e-distribuzione as a result of the reimbursement of system charges and network fees based on Resolutions nos. 50/2018 and 461/2020 of the Regulatory Authority for Energy, Networks and the Environment (ARERA) (€158 million).

The ordinary gross operating profit amounted to €7,714 million (€8,228 million in 2019) and reflected:

  • costs incurred mainly in Italy and Brazil as a result of the COVID-19 pandemic for workplace sanitization activities, personal protective equipment and donations (€50 million);
  • costs related to digitalization in Spain (€224 million);
  • provisions for charges related to restructuring plans connected with the energy transition in Colombia and Peru (€7 million).

Operating profit

Millions of euro      
  2020 2019 Change
Italy 2,370 2,647 (277) -10.5%
Iberia 1,140 1,288 (148) -11.5%
Latin America 696 1,349 (653) -48.4%
- of which Argentina (186) 240 (426) -
- of which Brazil 433 487 (54) -11.1%
- of which Chile 108 173 (65) -37.6%
- of which Colombia 253 292 (39) -13.4%
- of which Peru 88 157 (69) -43.9%
Europe 52 13 39 -
Other 4 (20) 24 -
Total 4,262 5,277 (1,015) -19.2%

In addition to the changes in gross operating profit for the year discussed earlier, the decrease in operating profit in 2020, including depreciation, amortization and impairment losses in the amount of €3,171 million (€3,001 million in 2019), was mainly due to an increase in impairment losses on receivables in Italy due, in part, to the effects of COVID-19 (€124 million) and the impairment losses on goodwill related to the Argentina CGU (€216 million), which was partially offset by exchange rate developments in Brazil.

Capital expenditure

Millions of euro      
  2020 2019 Change
Italy 1,966 1,753 213 12.2%
Iberia 631 647 (16) -2.5%
Latin America 1,156 1,335 (179) -13.4%
Europe 182 169 13 7.7%
Other 2 1 1 -
Total 3,937 3,905 32 0.8%

Capital expenditure increased by €32 million compared with the previous year. The rise was mainly attributable to Italy, as a result of quality and remote control investments, and to Romania (€13 million) for activities connected with service quality and new connections.
This increase was partially offset:

  • in Latin America, and particularly in Brazil, by a reduction in capital expenditure as a result of unfavorable exchange rate developments and the freeze on rates imposed beginning in February 2019;
  • in Iberia by a reduction in capital expenditure for substations, transformers and the replacement of metering equipment, and for software applications, partially offset by an increase in capital expenditure on the distribution network.

Capital expenditure on digital meters declined due to the slowdown in the mass replacement of meters as a result of the pandemic.