Acciona hopes to transfer part of the impact of the government’s plan against what are known as “profits that have fallen from the sky” to the price of the wholesale electricity market. The measure will fundamentally affect Endesa and Iberdrola’s nuclear and hydroelectric plants, but also hydroelectric and wind plants of the construction, services and energy group of the Entrecanales family.
The Government plans to lower the electricity bill by 5% by cutting 1,000 million to hydro and nuclear
While the nuclear lobby assured last week that the draft approved last Tuesday by the Council of Ministers leads him to “financial asphyxia” and “they doom him to closure”, in the Acciona Energía registration document published this Monday, after the approval of the National Securities Market Commission (CNMV), with a view to its next IPO, the multinational indicates that “the Spanish Government has adopted in the past similar measures that introduced new costs to generators and these costs could potentially be internalized and transferred to market prices in whole or in part ”.
However, the measure “could have a material adverse effect on our business, financial condition, results of operations and prospects.”
In this document, approved by the stock market regulator as a preliminary step for its placement and IPO through a public offer for sale (IPO) aimed at institutional investors, Acciona Energía includes an estimate of the potential impact of the preliminary project. Assuming a price of 47.63 euros per ton of CO2 for this year, it foresees that the gross impact on its accounts would be 29.4 million, but in net terms it would remain at 12.1 million.
According to his calculations, the facilities of its generation park affected by the reduction of the so-called “carbon dividend” could score 8.8 million in income from the “internationalization” of the mechanism by transferring it to wholesale market prices; and unaffected plants, another 6.6 million. With this, the net effect of the measure would be 14 million.
But to this would be added 1.9 million in concept of cost reduction in contributions for the hydroelectric canon and the Tax on the Value of Electricity Production. This would leave the final impact on the aforementioned 12.1 million.
The measure proposed by the Government tries to stop the overpayment that the rise in the carbon market is causing for electricity generation facilities that do not have to buy emission rights but benefit from the sharp rise induced in the wholesale electricity market because the price it is usually set by gas plants, which do pay to pollute. According to the Executive, it will have an impact of more than 1,000 million for the affected companies and would result in a cutback of the receipt of 5% once it is in force, something that would soon occur by the end of the year.
Acciona estimates that the draft measures would affect a net power of 1,125 megawatts (MW), 13% of its installed capacity at the end of 2020, and a production of 2.8 TWh, 12% of the total. 593 MW would be hydroelectric facilities (inherited from Endesa’s chopping-up after its joint takeover with Enel) and another 532 MW, wind farms that would also be affected by the cut, which would apply to facilities prior to the entry into force in 2005 of the European system of emissions trading.
Rosauro Varo on the council
The future listed subsidiary will be chaired by José Manuel Entrecanales, also president of the parent company, and with Rafael Mateo as CEO. The vice president of Acciona, Juan Ignacio Entrecanales, will also form part of the board and the other proprietary director will be Sonia Dulá. The businessman Rosauro Varo, recently appointed vice president of Prisa, will sit on the board.
The company, which is expected to trade around 25% of its capital, intends to triple its installed capacity by 2030 to reach 30 GW renewables. The price of the operation has not been made public but a range of between 10,000 and 12,000 million euros of total valuation is handled, in the absence of the publication of the final brochure, scheduled for the next few days and in which the starting price will appear and the specific date on which Acciona Energía’s stock market debut will take place. The company will be listed on the Continuous Market on the Madrid, Barcelona, Bilbao and Valencia Stock Exchanges.
The subsidiary expects to reach a total installed capacity of 20 gigawatts (GW) by the end of 2025 and has identified 28 GW in opportunities beyond 2025 with the goal of reaching an installed capacity of 30 GW in 2030.
Bestinver, Citigroup, Goldman Sachs and JP Morgan will act as ‘Joint Global Coordinators’ for the offering. Banco Santander, BofA, Joh Berenberg Gossler, Credit Agricole, Credit Suisse, HSBC and Société Générale will act as “Joint Bookrunners”.
Alantra, Banco Sabadell, ING Bank in cooperation with Stifel Europe, Intesa SanPaolo, Mirabaud Securities, Mizuho, Norbolsa and RBC will act as “Co-lead Managers”, while STJ Advisors and AZ Capital will act as independent financial advisors to Acciona Energía in the offer.
Lastly, Uría Menéndez and Davis Polk & Wardwell act as legal advisers to Acciona Energía and Linklaters as legal adviser to the banking union.