Reshaping the utilities of the future: which elements for a winning strategy? | Daniele Agostini

During a conference in Milan Ilaria Conti, Head of Gas at the Florence School of Regulation, interviewed Daniele Agostini (ENEL), the head of ENEL Low-carbon and EU Energy Policy. Gas and electricity utilities are currently undergoing a deep restructuring – imposed by the changes that occurred at macroeconomic and regulatory level. In particular, the pressure coming from the decarbonisation challenge in Europe is accelerating the need for every company to look for new business models and make bets on future market developments. What’s the starting point? Which are the most important elements to consider in this model shift? And what should, or could, regulators do? According to Agostini, de-carbonisation is one of the major drivers of this change and a challenge that not only Europe, but most countries around the world are or will be facing. Of course, the pressure and the speed of change imposed by decarbonisation vary considerably from country to country. Utilities do not necessarily have to adapt quickly to the new business environment, but – more importantly- they need to ensure that they are equipped with the “right instruments” to adapt to a fast-changing world. Is the market going to provide all answers? “Markets are great,” says Agostini. “But they are not perfect”. Cooperation with other sectors and dialogue with regulators and policy makers is essential to look together to the future and be ready to face its challenges. “What is important is not to lag behind. Moreover, regulatory evolution is essential to avoid market shocks” he concludes.