By Stephen Jewkes
MILAN (Reuters) -Enel will stump up 170 billion euros ($191 billion) this decade to fund its green power and networks businesses as it brings forward plans to become carbon-free to 2040.
The group will spend 70 billion euros on renewable energy to almost triple capacity it directly owns to 129 gigawatts (GW) by 2030 and will spend the same amount on networks to boost the number of grid customers and electricity sales.
"We need to electrify end consumption as much as possible," Enel Chief Executive Francesco Starace said in a presentation of the company's business plan.
Enel, one of the world's biggest green energy groups, will exit coal and gas generation by 2027 and 2040, respectively, replacing them with new green capacity and hybrid renewable-storage solutions. It will exit its gas retail business by 2040.
"In a couple of decades in any case there'll be very few Europeans still using gas... we have seen recently the craziness of depending on gas," Starace said.
"High gas prices won't go away that quickly and don't forget it can happen again and again."
Electricity and gas prices have rocketed this year as tight gas supplies have collided with strong demand in economies recovering from the COVID-19 pandemic.
Energy companies, including big oil, are ploughing money into the clean parts of their businesses as climate change prompts them to rethink strategies.
German utilities E.ON and RWE recently unveiled green spending plans, amid pressure to shift away from fossil fuels to limit global warming.
Enel said it expected to raise 10 billion euros from asset sales in the course of the plan to 2024, of which 7 billion euros would be spent on organic growth.
The utility could sell renewable assets in parts of the world where it did not have an integrated generation and distribution network to focus on key markets such as Italy, Spain and the United States, Starace said.
"The U.S. is a country where we should have an integrated position," Starace told the strategy presentation.
ENDESA IN SPOTLIGHT
The group, which controls Spanish utility Endesa, said it planned to attract 40 billion euros from third parties, taking total spending to 2030 to 210 billion euros.
It said the investments would cut customer energy costs by 40% and help reduce carbon emissions by 80% by 2030. By 2040 all power sold to its clients will be from renewable sources.
Enel's decision to ditch gas raises questions about the future of assets and clients managed by Endesa, Spain's second largest gas retailer with nearly 1.7 million customers.
Enel, which generates most of profits from renewable energy and networks, expects core earnings, excluding restructuring costs, to rise 12% to 21.0-21.6 billion euros in 2024.
Some of Enel's short-term targets were trimmed compared to the previous plan, but the reductions were in line with market expectations, analysts said.
Enel shares were up 1.8% by 1509 GMT, outperforming a 0.2% rise in the European utility index.
($1 = 0.8892 euros)
(Reporting by Stephen Jewkes; Editing by Edmund Blair and Keith Weir)