Italy's A2A trims green investment plan, confirms dividend policy

MILAN (Reuters) - Italy's largest regional utility A2A scaled back its planned investments aimed at reducing its carbon footprint as volatility in energy markets prompted a rethink, sending shares down as much as 6%.

A2A confirmed its dividend policy under the new plan, which foresees a 3% compound annual growth, Chief Executive Renato Mazzoncini said.

The Milan-based utility said it now planned to invest 16 billion euros ($16.5 billion) by 2030 to focus on the circular economy and energy transition projects, rather than the 18 billion euros previously indicated.

Mazzoncini told analysts that at the end of September, customer requests to break electricity and gas payments into installments had risen eight times compared to 2019 and five times from the first nine months of 2021.

That took away hundreds of millions of euros from investments, he said.

By 1505 GMT, the stock was down 1.9% at 1.274 euros per share, the worst performer on Italy's blue-chip index, which was losing 0.08%.

Intesa Sanpaolo's analysts said the new spending target reflected changed economic conditions.

The regional utility had last updated its strategy in January, when it raised planned capital spending to reduce its carbon footprint by 12.5% to 18 billion euros while targeting a core profit of 2.9 billion euros by 2030.

This year "has been characterized by a complex geopolitical and economic situation and a volatile energy scenario," CEO Mazzoncini said in a statement.

"In the light of this context, we have decided to update our plan to continue guaranteeing the Group's solidity and face the upcoming challenges," he added.

Italy's economy minister said in September that net energy import costs were set to more than double this year to nearly 100 billion euros, warning Rome could not spend indefinitely to cushion the blow.

Italy relies on imports for three-quarters of its power consumption, increasing its vulnerability to Europe's current energy crisis.

($1 = 0.9681 euros)

(Reporting by Giancarlo Navach in Milan; Additional reporting by Jose Joseph and Akriti Sharma in Bengaluru and Federica Urso in Gdansk; Editing by Tomasz Janowski, Keith Weir and Bernadette Baum)