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Managing and optimizing large customer supply contracts in a - - PowerPoint PPT Presentation

Feb 04, 2024 208 likes •399 views

Managing and optimizing large customer supply contracts in a deregulated market Ing. Luigi Borrelli Knowledge 2006 Conference 24-25 April 2006 Uso: inserire classificazione Agenda Enel Company Overview The Italian Market Overview

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Managing and optimizing large customer supply contracts in a deregulated market

  • Ing. Luigi Borrelli

Knowledge 2006 Conference 24-25 April 2006

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2 Uso:

inserire classificazione

Agenda

  • Enel – Company Overview
  • The Italian Market Overview
  • The Challenge for Enel
  • How the IT Supports the Challenge: The Large and

Industrial Customer Case

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SLIDE 3

3 Uso:

inserire classificazione

Agenda

  • Enel – Company Overview
  • The Italian Market Overview
  • The Challenge for Enel
  • How the IT Supports the Challenge: The Large and

Industrial Customer Case

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4 Uso:

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10 20 30 40 50 60 CLP Holdings Ltd Centrica plc First Energy Corp Chubu Electric Power Scottish Power plc Kansai Electric Power Iberdrola National Grid PLC The Southern Company Duke Energy Endesa SA Electrabel SA Dominion Resources Tokyo Electric Power Exelon Corp RWE AG Enel E.ON EDF

Enel: one of the largest utilities in the world

Source: Bloomberg, Company’s data

Market cap pf worldwide utilities (€ bn) Shareholders Profile (% of shareholders’ equity)

29,5% 21,9% 38,4% 10,2%

Italy France Holland Germany UK RoE NA RoW

24,4% 24,7% 5,2% 22,8% 2,4% 10,7% 8,3%

Geographical split of institutional investors

1,5% Ministry of Economy Cassa Depositi e Prestiti Institutional Investitors Retail

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Enel in the world

ROMANIA

51% of Distribution companies Banat e Dobrogea

  • 1.4 million customers

RUSSIA

North Western thermal power plant management contract

  • 1.592 MW Thermal
  • 671 MW Hydroelectric
  • 600,000 customers!

80% of EUFR:

  • 294 MW Wind
  • 89 MW Hydroelectric
  • 62 MW Cogeneration

SPAIN BULGARIA

67% of Maritza East III:

  • 732 MW Thermal

5% Powernext

Europe North and Latin America

Data as of April 15th 2004 1 – On the regulated market

  • 286 MW Hydroelectric
  • 67 MW Wind
  • 21 MW Biomass and Biogas
  • 171 MW Hydroelectric
  • 20 MW Wind

SLOVAKIA*

66% of Slovenske Elektrarne

  • 6.881 MW

* acquisition to be completed by early 2006

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Enel’s core business

Electricity Electricity

Production Production Transmission Transmission Distribution Distribution Market Market

  • 133 TWh sold to the

regulated market

  • 21 TWh sold to the free

market

  • Stake reduced to 5 %
  • 246 TWh distributed in Italy
  • 29.6 mn customers in Italy
  • 0.6 mn customers in Spain
  • 1.4 mn customers in

Romania

  • 41.8 GW installed in Italy

Of which renewable:

– 14.3 GW hydro – 666 MW geo – 131 MW solar & wind

  • 126 TWh produced

(~11,000 MW installed abroad*)

  • 5.2 bn m3 sold
  • ~ 2 mn customers

Gas Gas

Upstream Upstream Transportation Transportation Distribution Distribution Market Market

Wholesale 43% Wholesale 43% Distribution Distribution 81% Retail 52% 81% Retail 52%

Market Market Share Share in in Italy Italy

* including Slovenske Elektrarne (+6,880 MW), acquisition to be completed by early 2006

Market Market Share Share in in Italy Italy

Distribution Distribution 10.5% 10.5% Retail Retail 11% 11%

2004 Data

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SLIDE 7

7 Uso:

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Agenda

  • Enel – Company Overview
  • The Italian Market Overview
  • The Challenge for Enel
  • How the IT Supports the Challenge: The Large and

Industrial Customer Case

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Free Market: evolution 2000–2005

Volumes in TWh (including losses, without auto–consumption)

20 40 60 80 100 120 140 2000 2001 2002 2003 2004 2005

45 99,6 117,5 132,9 142 76

Other Operators 21,5 28,0 31,5 10,7 20,9 20,0 Enel Sales

TWh

Market Share Enel 14,1% 15,7% 9,1% 31,6% 36,8% 47,8%

ESTIMATES

Volume driven strategy Selective margin driven strategy – customised offers to target segments

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9 Uso:

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Agenda

  • Enel – Company Overview
  • The Italian Market Overview
  • The Challenge for Enel
  • How the IT Supports the Challenge: The Large and

Industrial Customer Case

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Preparing Enel for the next challenges

People Organization Market

Facing competition at retail and residential level Defending our leadership in power generation in Italy Matching the challenge of international development in the integrated

European energy market

Growing as a primary player in the gas market Operational excellence Top quality Organizational flexibility and integration Successful Integration of our international operations Spreading market culture at all company levels More flexibility, more communication, more encouragement From a “domestic” to a “international” culture

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SLIDE 11

11 Uso:

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Agenda

  • Enel – Company Overview
  • The Italian Market Overview
  • The Challenge for Enel
  • How the IT Supports the Challenge: The Large and

Industrial Customer Case

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The Large and Industrial Customers

Industrial Large

SME SOHO Residential Electric./Gas

Consumptions GWh/Year > 100 1 - 100 0,05 - 1 0 – 0,05 Characteristics of Purchasing Process

Wholesales type (i.e. specialized buyer, low price, no need of commercial services) Price sensitive, not very sophisticated such as the industrials, good sensitivity towards commercial service support Low price sensitivity, sensitive towards services and conveniences (i.e. dual fuel), “faithful”

Market-Segmentation

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Retail Customer Care Retail Load/Energy Supply Management

Registration

Marketing & Campaign Management

Deal Capture/ Aggregation Structuring/ Pricing Customer Data Financial Data Load Data Bids & Offers Demand & Supply Schedules Settlements Customer Interaction & Inquiries Credit & Invoicing Financial Data Settlements Load Forecasting ISO/ RTO Portals

Finance, Planning & Accounting

Wholesale Portfolio Management

Risk Management Forecasting Trading Energy Markets Scheduling Settlements ISO/RTO Portals Settlements Forecast/Risk Components Product Details Aggregation Deemed Profiles

Enrollments

Load Forecasts Scheduling/ Settlements (ISO/RTO) Customer Enrollment Cost Curves

Consumption

Transaction Management Settlements Prospect Management Sales Force Automation/ Contract Mgmt. Marketing Campaign Development Marketing Campaign Execution Marketing Data Mart & Customer Data Mining Product & Service Development

Product Matrix Cost of Goods Sold

Business Requirements

Straight-Through Processing

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Business Requirements

To support tightly integrated business processes spanning across different functional and divisional areas

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The Infrastructure Solution

Metering Settlement ERP Risk Management Demand Forecast Business Intelligence

Retail Sales Management

Trading EU GRID OPERATORS EU SPOT & CONTINUOUS MARKETS

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Key Benefits

  • Operational

– Single Integrated Platform – Security Levels – Speed, Accuracy, Consistent Contracts – Flexible in adapting new Pricing Options – Workflow Design based on Enel Processes

  • Financial

– Improve Portfolio Efficiency – Reduce Risk – Improve Cash Flows – Better Management of Penalties/Losses

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Some Performance Indicators

  • IT Opex = 20% reduction
  • Process Cycle Time (number of hours to execute the process end-to-end)

= reduction of almost 83% - from 72 to 12 hours

  • Cost of Process = Reduction of 25% - from 60 to 45 FTEs
  • Processed transaction throughput (number of account receivable

DIVIDED BY 365) = increase of 249% - from 5,479 to 1,369,863

  • Expected ROI = 18 Months