* CEO calls for big changes to Spanish energy reform
* Reform could impact Enel 2013 EBITDA by 275 mln euros
* H1 EBITDA beats market forecast
(Recasts with management comments)
By Stephen Jewkes
MILAN, Aug 1 Italy's biggest utility Enel
said on Thursday its future investments in regulated
businesses in Spain were at risk unless an energy reform there
Enel, which owns 92 percent of Spanish utility Endesa
, generated around half of its total production in Italy
and Spain in the first half of 2013 and regulatory risk in these
countries is a key concern for investors.
"In the absence of substantial amendments (to the Spanish
reform) there will be an impact on our results and a risk to
future investments in regulated businesses," CEO Fulvio Conti
said on a conference call about first-half results.
Conti said a preliminary estimate indicated the reform plans
of the Spanish government could impact his group's core earnings
by around 275 million euros ($364 million) in 2013 and 400
million euros in 2014.
Spain, plagued by recession and one of the euro zone's
biggest public deficits, has a 26 billion euro power tariff
shortfall. The government recently announced a major overhaul of
the sector to reduce a gap between regulated power prices and
generation costs by 2.7 billion euros a year.
On Wednesday Enel Green Power, which is controlled
by Enel, said it was mulling taking legal action against the
energy reforms planned in Spain.
"We're investing money in the distribution network (in
Spain) ... We'll stop investing immediately," Conti said.
Enel, Europe's No 2 utility in terms of installed capacity,
said on Thursday its core earnings in the first half fell on
ongoing weakness in its traditional power generation business.
Earnings before interest, tax, depreciation and amortisation
(EBITDA) dipped 0.3 percent to 8.29 billion euros, beating the
average forecast of 8.11 billion euros provided by the company
and based on 16 analysts.
Weakness in power generation in its core markets of Italy
and Spain was offset by strong growth in renewable energy
The economic crisis continues to take its toll on utilities
across Europe as falling power demand, weaker electricity prices
and increased competition from renewable energy squeeze the
margins of traditional generators.
Earlier on Thursday, France's GDF Suez posted a 25
percent drop in first-half net profit and said it saw no sign of
improvement in Europe's power generation market.
In July S&P downgraded Enel and Endesa on weakening economic
and industry prospects in core markets which it said were set to
erode the group's profitability.
But Enel, one of Europe's most indebted utilities, said cost
cutting and debt reduction programmes meant it was able to
confirm its full year targets.
($1 = 0.7557 euros)
(Editing by Mark Potter)