Market Italy

Repower in Italy is increasingly evolving into a full-service provider to businesses. Thanks to an internal reorganisation, the sales network is now even closer to customers.

Contribution to EBIT

The Market Italy segment's contribution to operating income (EBIT) in the first half of 2015 was CHF -23 million. This figure includes impairment of CHF 23 million on the Teverola combined-cycle gas turbine plant. There has been an important development on the tax front: in February the Italian constitutional court abolished a “Robin Hood” tax on energy companies that had a serious impact on the industry.

Generation and projects

In the first half of 2015 the Teverola combined-cycle gas turbine plant operated by Repower in the Campania region in southern Italy was deployed less frequently than last year for the balancing energy market. The reason for this was a decline in demand for ancillary services on the part of grid operator Terna, which has affected all thermal electricity generation assets in Italy.

Total revenues from the Corleto Perticara (Basilicata), Lucera (Apulia) and Giunchetto (Sicily) wind farms were better than expected, thanks in particular to an increase in revenues on green power certificates and better-than-anticipated volumes of electricity generated.

As for the Saline Joniche coal-fired power plant, by the end of this year at the latest Repower will have completely withdrawn from the project while complying with the relevant contractual obligations.

Trading in Milan

The trading business in Milan failed to generate the anticipated revenues in the first half of 2015. The main reasons for this were reduced deployment of the Teverola power plant and narrower electricity and gas margins due to negative price developments. The volumes of energy sold in trading came to 0.8 terawatt hours of electricity (down 55 per cent on the prior-year period) and 10.6 terawatt hours of gas (up 13 per cent on the prior-year period).

In the first six months Repower launched BIG, a new offering geared to large electricity and gas customers. The main motivation for developing this product was to extend Repower's gas portfolio to include large consumers and thus give traders more leeway for exploiting market opportunities.

Sales

In the first half of 2015 the Italian sales business made a pleasing contribution to group EBIT thanks to lower internal costs – with the volumes of electricity sold more or less unchanged. Repower Vendita Italia S.p.A. sold around 1.8 terawatt hours of electricity (up 3 per cent on the prior-year period) and 1.4 terawatt hours of gas (up 27 per cent on the prior-year period) to consumers.

In addition to BIG, Repower in Italy officially launched VAMPA, a new thermal imaging service that after being marketed to select pilot customers is now available across the board. The thermal images it produces give an early indication of any faults in electrical equipment and production facilities.

In the first half of this year Repower reorganised its network of sales consultants in Italy to create a platform for future growth. Selected consultants are now responsible for recruiting new salespeople, and training for consultants has also been redesigned. All these projects pursue the same goal of further intensifying Repower's presence in all areas of the country.

Repower's 2015 communications campaign could be seen and heard between March and June. In a campaign spanning radio, billboards, print ads and – for the first time – TV commercials, Repower portrayed itself as a personal trainer to companies seeking professional advice on how to get fit in terms of energy efficiency. Following the success of the campaign, which featured images from American photographer Howard Schatz, Repower staged the first personal exhibition of the artist's work in Italy.

Innovation

The two products DIODA (LED lighting) and eFFettiva (a service designed to improve energy efficiency) have been developed further in recent months. They are already available to consumers in certain regions on a pilot basis.

Repower Italy has developed a new offering called FOCUS featuring an energy diagnosis which enables companies to have their energy performance analysed as the basis for recommendations for optimising their consumption.