Our business model
We produce energy using a combination of programmable and non-programmable production sources (wind, water, natural gas), which are complementary, flexible and dynamic, with a common specific goal: to generate clean energy. Programmable sources can be managed according to energy demand and make it possible for us to take part in the electricity market as system operators.
Since electricity cannot be stored, production must always match consumption. Efficient programming of our production assets is therefore essential: this is what our Energy Management department deals with as it works to optimise production according to the needs of the electricity market.
Our business model is based on the clear choice of being a green operator whose electricity production mix is balanced between programmable (water and natural gas) and non-programmable (wind) sources.
At the end of 2015, 58% of our capital is now invested in wind power (a non-programmable source) (it was 20% in 2008).
Since 2015, we have added hydro power (which is programmable) by acquiring the Terni Complex, decisively venturing into the field. At the same time, the share of natural gas (thermoelectric power, programmable) in our portfolio has gone down from 32% to 12% and now includes only our high-efficiency and low-emissions Priolo cogeneration plant, which produces Energy Savings Certificates.
In January 2018, thanks to an important acquisition, we have made our entry into the solar business and today we are operating in eight different Italian regions.
"One Company" Project
Coming within this context is the "One Company" project, giving rise to a major revision of the Group's organisational and corporate structure, with a view to making it more suited to our new business model. The corporate reorganisation, effective from 1 January 2017, envisaged the merger by incorporation of ERG Services S.p.A. into ERG S.p.A.and the merger by incorporation of ERG Renew S.p.A. and ERG Renew Operations & Maintenance S.r.l. into ERG Power Generation S.p.A.
In the new corporate structure, ERG Power Generation S.p.A. (wholly owned by ERG S.p.A.), an electricity production and sale company, will be dedicated to the overall and integrated management of the three diverse and complementary generation technologies (wind, water and natural gas) currently available to the Group and to the sale of electricity through a single centralised Energy Management structure.
In ERG S.p.A., the reorganisation particularly provides for:
- the creation of a new area dedicated to Business Development, directly reporting to theChief Executive Officer, with responsibility for ensuring the achievement of geographical,technological and market growth objectives in the short and medium term;
- the creation of a single integrated Risk Management function to enable a more accurateand timely control of risks typically associated with the new business model;
- the centralisation of goods and services purchase procedures with a view to creating value by obtaining operational and dimension-related synergies; the centralisation of certain staff functions now partially located at the merged companies in order to enhance their efficiency, coordination and timeliness of intervention;
- the concentration of Information Technology and Communication (ITC) competences within a single function in order both to satisfy the immediate requirements pertaining to the new business model and to take advantage of potential opportunities deriving from the ongoing diffusion of computer digitisation.
ERG S.p.A. – corporate – which guarantees strategic guidance, is directly responsible for business development processes and ensures the management of all the business support processes. The company is organised into the following 5 areas:
- Business Development, with the mission of ensuring business development in various geographical, technological and market areas;
- Administration, Finance, Planning and Control, Risk Management, M&A, IR and Purchasing;
- Human Capital, ICT and General Services;
- Institutional Relations and Communication;
- Legal and Corporate Affairs.
ERG Power Generation S.p.A., which is assigned the responsibility for the Group’s industrial and commercial processes. It is organised into:
- Wind, Hydro, Solar and Thermo generation technologies, which in turn are organised into production units on a geographical basis;
- Energy Management, as the single entry point into organised markets;
- a commercial structure dedicated to Key Accounts;
- a centre of technological excellence in charge of the Engineering & Construction processes;
- a hub of specialised skills in regulatory, planning and performance control matters, transversal to all business processes;
- a structure dedicated to managing issues of health, safety and environmental protection for the entire Group.