From nationalisation to the reform of the Italian electricity system.
Terna’s main activities are rooted in Italy’s history: on 6 December 1962, Law 1943 paves the way for nationalisation of the electricity industry, handing ENEL (Ente Nazionale Energia Elettrica) responsibility for all the stages of the electricity supply chain (production, transmission and distribution), previously in private hands, in order to facilitate the country’s electrification.
In the second half of the 1990s, the European Union embarks on a process of deregulation aimed at making grid management independent. In Italy, this leads to the issue of Legislative Decree 79/1999 (the so-called “Bersani Decree”), marking a starting point for reform of the Italian electricity market with the separation of ownership of the National Transmission Grid (“NTG”) from management of the grid itself (transmission and dispatching) along the lines of the “Independent System Operator” (“ISO”) model.
Terna is established in 1999. ENEL establishes of two distinct companies: Terna S.p.A., assigned ownership of over 90% of the NTG, and GRTN (“Gestore della Rete di Trasmissione Nazionale”), which at this time manages electricity transmission and dispatching and planning for the development of the NTG.
The Cabinet Office Decree of 11 May 2004, in application of Law 290/2003, establishes the electricity exchange and brings back ownership and management of the transmission grid under the control of one entity. This process is completed in 2005, with the transfer to Terna of the GRTN business unit relating to transmission and dispatching and the award of the concession to carry out these activities throughout the country by the Ministry of Productive Activities: Terna thus becomes Italy’s Transmission System Operator (“TSO”).
On 24 June 2004, 50% of the Company’s share capital is floated on the Italian Stock Exchange and, in September 2005, Cassa Depositi e Prestiti acquires a 29.99% stake, thereby becoming the relative majority shareholder.
DEVELOPMENT OF THE NATIONAL TRANSMISSION GRID AND NEW BUSINESS OPPORTUNITIES
“Utili per il Paese” (“Working for the country”), Terna’s new role.
Having taken on the dual role of TSO and SO, Terna’s role evolves as it becomes a provider of strategic infrastructure for the country, as expressed in the payoff, “Working for the country”.
This period sees the Company progressively expand the NTG. Following the acquisition of 18,600 km of high-voltage lines from ENEL in 2009, Terna owns 98.6% of the national grid and becomes the leading independent grid operator in Europe and the seventh largest in the world. In 2015, Terna acquires the Ferrovie dello Stato group’s high-voltage grid, consolidating its leadership in Europe with approximately 72,600 km of grid managed.
At the same time, Terna plans and delivers major new 380kV connections to bring the transmission grid into line with the country’s energy needs: the Chignolo Po-Maleo (Lombardy) and the SA.PE.I submarine connection (from Sardinia to the Italian mainland) enter service in 2011, whilst the Trino-Lacchiarella (Lombardy) and Villanova- Gissi (Abruzzo) lines and the submarine connection linking Sorgente and Rizziconi (Calabria-Sicily) enter service in 2014 and 2016, respectively.
In keeping with changes in the operating environment, the Group is restructured with the establishment of two new operating companies in 2012: Terna Rete Italia S.p.A. for Regulated Activities, and Terna Plus S.r.l. to drive the growth of services in the Nonregulated sector. Tamini, an Italian leader in the design, production, commercialisation and repair of power transformers for electricity transmission and distribution grids, of industrial transformers for the steel and metals industry and of special transformers for convertors used in electrochemical production and electrolysis, joins the Terna Group in 2014.
FIND OUT ABOUT KEY EVENTS IN 2023
FROM ENABLING TO DRIVING THE ENERGY TRANSITION
With “Driving Energy”, Terna’s positioning evolves
The accelerating shift towards a new energy paradigm sees Terna assume an ever more central role in the electricity supply chain, opening a new chapter in its history by focusing on the role of the National Transmission Grid in enabling the energy transition.
Work begins on major electricity infrastructure projects, such as SA.CO.I.3 (connecting Sardinia, Corsica and the Italian mainland) and the Italy-Austria interconnector. Work on the Italy-Montenegro interconnector is completed. It is the first electricity bridge between Italy and the Balkans, a key link enabling Italy to reinforce its role as a European and Mediterranean electricity transmission hub. In 2022, the green light is given to the East Section (Campania to Sicily) of the undersea power line dubbed the Tyrrhenian Link. Terna is to invest a total of approximately €3.7 billion in the project.
Terna owns 99.9% of the NTG in 2021 after purchasing portions of the grid from other operators and, with investment of €10 billion, the updated Industrial Plan for the period 2021-2025, “Driving Energy”, presented in 2022, strengthens its role in driving the Italian electricity system.
2022 also sees Terna, alongside the Ministry of the Environment and Energy Security, launch a corporate advertising campaign called Noi Siamo Energia to promote the conscious, rational and attentive use of electricity in Italy.
From 2018, Terna funds its investment in infrastructure using new financial instruments, becoming the first Italian utility to successfully place a Green Bond worth a total of €750 million, followed by a further three issues with a total value of €2 billion. Confirmation of the Company’s determination to combine sustainability with growth to enable the energy transition is provided 2022, when Terna issues its first hybrid green bond with €1 billion.
On the corporate front, in the period in question, the subsidiary, Terna Energy Solutions, strengthens its industrial side by acquiring the Swiss company, Brugg Kabel AG, one of Europe’s leading manufacturers of terrestrial cables, and acquires 75% of LT S.r.l., creating the number one provider of Operation & Maintenance services for photovoltaic plants. Terna signs a partnership agreement with Meridiam and Boundless Energy to develop joint initiatives in the USA in the field of power grids. Terna Forward is established with the aim of identifying the best technology opportunities and transferring them to other Group companies.
AT THE HEART OF THE TRANSFORMATION
‘Let’s think about the future of energy’
Enable achievement of the targets in the EU’s Fit for 55 package, facilitate the integration of renewable sources, develop overseas interconnectors, boost the level of security and resilience of the electricity system and invest in digitalisation of the grid. These are the key goals in the 2023 Development Plan for the NTG, with over €21 billion to be invested in the ten years from 2023 to 2032.
The commitment to developing the power grid can also be seen from the projects consented to in 2023, amounting to investment of over €3 billion.
The undersea electricity connection between the island of Elba and Piombino, in which Terna invested €90 million, and the Italy-Austria interconnector, built at a cost of €80 million, enter service in 2023, facilitating the development of renewable energy and boosting the security of the European electricity network.
Terna and Steg, the Tunisian electricity and gas company, sign the Grant Agreement that will see the EU Commission providing financing of €307 million for the Elmed electricity interconnector between Italy and Tunisia, with the total investment expected to be approximately €850 million.
In 2023, the Ministry of the Environment and Energy Security gives the green light for the West Section (Sicily-Sardinia) of the Tyrrhenian Link, a direct current submarine cable between Sardinia, Sicily and Campania; the final design for Sa.Co.I.3, the submarine cable that will connect Sardinia, Corsica and Tuscany; and, in early 2024, the Adriatic Link, the submarine power line that will connect the Marche and Abruzzo regions.
In 2023, Terna acquires a 100% stake in Edyna Transmission S.r.l. (renamed Rete Nord S.r.l.). The company owns two electricity substations and approximately 70 km of circuits in Alto Adige already part of the NTG. A strategic transaction that will unify Italy’s electricity transmission infrastructure.
‘Let’s think about the future of energy’ is the claim in the new corporate advertising campaign that aims to make the public aware of the value of energy, a basic good to be used fairly and responsibly.
The issue of a new green bond worth €650 million and with a 10-year term is successfully completed: the market showed a strong appetite for the bonds, with the issue approximately four times oversubscribed.
Terna’s CEO and General Manager, Giuseppina Di Foggia, assumes the role of Vice President of GO15, the worldwide association of Very Large Power Grid Operators.
