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Edison SpA: Europe's Oldest Energy Company and the Italian Energy Transition
Introduction: A 140-Year Journey Through Light, Nationalization, Scandal, and Renaissance
In the grand tapestry of European industrial history, few threads stretch back as far—or wind through as many dramatic turns—as Edison SpA. Founded in 1884 by Giuseppe Colombo in Milan as "Società generale italiana di elettricità sistema Edison," the company served the purpose of introducing and applying Thomas Edison's inventions to Italy. What makes this story remarkable isn't just its longevity—it's the sheer improbability of survival.
Consider what Edison has endured: nationalization in 1962 that stripped away its core business, a forced merger that buried its identity for three decades, involvement in one of Italy's most spectacular corporate scandals, a hostile takeover by a consortium including Fiat, and ultimate acquisition by French state-owned EDF. In 2012, Electricité de France finally bought 99.5% of Edison's shares and delisted it from the Milan stock exchange.
Yet here stands Edison today, with a trailing 12-month revenue of $18.1 billion and a current market capitalization of $11 billion. The company operates as Italy's second-largest power producer, with eyes fixed on small modular nuclear reactors, offshore wind farms, and green hydrogen valleys.
The central question for investors: How does a 140-year-old company—one that literally brought electricity to Italy—reinvent itself in the age of decarbonization while navigating foreign ownership and potential re-listing? The answer reveals lessons about regulatory risk, strategic patience, and the paradox of heritage companies that must continuously reinvent themselves to remain relevant.
Part I: The Founding Vision — From Menlo Park to Milano (1881-1900)
The Professor Who Crossed the Atlantic
Picture Milan in 1881—a city of gas lamps and horse-drawn carriages, where factories relied on steam and the Duomo's spires rose against skies darkened by coal smoke. Into this world stepped Giuseppe Colombo, not as a businessman but as an engineering professor at the Politecnico di Milano with a peculiar obsession: the work of an American inventor named Thomas Alva Edison.
Colombo, an engineering professor, was a great admirer of Edison, whom he had met in the United States in 1881, securing an exclusive licence for some of his patents for Italy and hiring some of his collaborators.
The encounter between Colombo and Edison in America was more than a business transaction—it was a technology transfer that would transform a nation. Colombo recognized that Edison's incandescent lighting system represented something revolutionary: not merely a better candle, but the foundation of an entirely new infrastructure that would reshape cities, factories, and daily life.
In a letter dated November 22, 1883, Colombo reported to Thomas Alva Edison the progress of the Santa Radegonda power plant, which became the first power plant on the European continent. The letter captures Colombo's methodical excitement: the professor was simultaneously managing construction, coordinating with Edison's American engineers, and preparing for what would become one of the most spectacular public demonstrations of electrical power in European history.
The Night That Changed Italy
The most festive and elegant manifestation, the most spectacular event—a true historic date—coincided with the illumination of Teatro alla Scala. On Santo Stefano night in 1883, during the crowded premiere of Amilcare Ponchielli's "La Gioconda" at Teatro alla Scala, the Edison power plant at Santa Radegonda lit the electric bulbs, giving for the first time a surprising and unexpected light to the La Scala performance.
Imagine the scene: Italy's cultural elite assembled for the opera season's most anticipated performance, suddenly bathed in a warm, steady glow unlike anything they had experienced. The newspapers of the era used "enthusiastic words" to describe the spectacle made possible by Edison and its founder.
Edison operated the Santa Radegonda power plant, Europe's first power plant. This wasn't merely a commercial achievement—it established Milan alongside New York and London as one of the world's first cities to deploy commercial electric power.
From Coal to Water: The Alpine Hydroelectric Empire
The economic crisis that erupted between the 1880s and 1890s caused fluctuations in the price of coal fuel, pushing Colombo to explore the potential of hydraulic power. Colombo obtained the concession to exploit the waters of the Adda and built the Paderno d'Adda hydroelectric power plant in 1898, the largest hydroelectric power plant in Europe at the time.
The generating machines installed (9,500 kW) were the most powerful in Europe at the time. This pivot from thermal to hydroelectric power would define Edison's strategic advantage for decades—and foreshadow the company's eventual return to renewable energy more than a century later.
In the following decades, Edison continued growing, especially in hydroelectric power, and came to control power distribution in most of northern Italy.
For investors, the founding era establishes a crucial pattern: Edison's survival has always depended on its ability to recognize technological inflection points and adapt before competitors. Colombo didn't just import Edison's technology—he fundamentally reconceived it for Italian geography and economics, pivoting to hydroelectric power when coal prices threatened the business model.
Part II: Building the Hydroelectric Empire (1900-1962)
Northern Dominance and the Pre-War Oligopoly
By the early twentieth century, Edison had evolved from a single Milanese power station into something far more formidable: the dominant electrical utility across Italy's industrializing north. The company controlled the power that fed textile mills in Lombardy, steelworks in Piedmont, and the emerging automotive factories that would eventually produce Fiat automobiles.
The structure of the Italian electricity market before 1962 deserves attention because it explains so much of what followed. In 1962, the centre-left coalition government of Christian Democrats and Socialists decided to nationalize the electric sector in Italy to break the oligopolistic power of the four dominant electric companies that comprised the market.
Edison was one of those four dominant companies—and arguably the most powerful. The company had spent decades building hydroelectric infrastructure in the Alps, creating a vertically integrated empire that controlled everything from mountain reservoirs to urban distribution networks.
Edison, thanks also to Marshall Plan financing, invested huge sums, particularly in the period 1949-59, for the construction of dams and hydroelectric power plants, culminating with the construction of Europe's largest hydroelectric plant, Santa Massenza I, with a capacity of 350,000 kW, designed to exploit the waters of the Sarca river in Trentino and commissioned in 1957. An equal construction fervor affected thermoelectric plants, with the works in Genoa, Piacenza and Tavazzano.
In 1962, the year of nationalization of the electricity industry, the production of the Edison group was equivalent to 25% of the national total. One quarter of all Italian electricity—generated by a single private company. The concentration was remarkable, and to the socialist and Christian Democrat coalition that came to power, it was intolerable.
The Vajont Shadow
Any discussion of Edison's pre-nationalization era must acknowledge the Vajont Dam disaster of 1963—one of the deadliest dam failures in history. On October 9, 1963, a huge landslide of 260 million cubic metres fell into the reservoir formed by the dam. The dam and power plant had been built by the Società Adriatica di Elettricità (SADE) and then sold to Edison, and it had just been transferred as part of the nationalisation process to the newly established Enel.
Approximately two thousand people died in the disaster. Enel and Montedison were charged in the ensuing trial as the companies responsible for the disaster, a responsibility considered all more serious because of the predictability of the event.
The timing was particularly cruel: Edison had owned the asset but had just transferred it to the newly created state entity Enel. Yet the reputational damage attached to Edison and its successor company Montedison, adding moral complexity to what was already a traumatic corporate transformation.
Part III: The Nationalization Trauma (1962-1978)
The Political Earthquake
On November 27, 1962, the Parliament approved the nationalization of the electricity system and the establishment of National Agency for Electric Energy (or Ente Nazionale per l'Energia Elettrica, ENEL), to which were delegated all activities of production, import and export, transport, processing, distribution, and sale of electricity produced from any source.
Historical producers such as the Piedmont Hydroelectric Company, Edison, and EMS were to sell their assets to the new agency; only self-sufficient power producers and municipal utilities were excluded from the regulation. Ultimately, ENEL came to absorb the activities of more than 1,000 electricity companies.
For Edison, this wasn't merely a regulatory change—it was existential amputation. The company's entire reason for being—generating and distributing electricity—was being transferred to the state.
The monetary compensation would be paid in cash over a period of 10 years at a 5.5 per cent annual interest rate. This compensation structure would prove crucial: Edison received substantial cash that would fund its ill-fated diversification.
Giorgio Valerio's Fateful Gamble
With the compensation money it obtained from the state, Edison, then headed by Giorgio Valerio, invested heavily to diversify its activities, primarily in the petrochemical sector and by buying the Standa supermarkets chain, continuing producing power only for self-consumption.
Giorgio Valerio's biography reveals the background to this decision. Valerio was born in Milan on March 20, 1904, from a good Lombard family. He graduated on September 13, 1926 in electrical engineering from the Polytechnic of Milan and was hired eight days later by the Italian General Edison Electricity Company. After his first assignment as a designer, he quickly climbed the corporate hierarchy, assuming the position of commercial director in 1927 and administrative director in 1935.
Valerio was a company man through and through—an engineer who had spent his entire career within Edison's walls. When nationalization stripped away the business he understood, he made the classic utility executive's mistake: he assumed that industrial scale and capital would translate across sectors.
The Standa Supermarkets Disaster
The Standa acquisition deserves particular attention because it represents one of the worst strategic pivots in Italian corporate history. Standa was a supermarket chain—as far removed from electricity generation as one could imagine. Valerio apparently believed that Edison's distribution expertise and customer relationships could translate to retail.
They could not. This strategy was unsuccessful, though, as competition with both state-owned Enrico Mattei's giant Eni and Montecatini, a large private chemical company, proved too hard, so in 1965, Edison was eventually forced to merge with Montecatini, forming Montedison, the largest chemical company in the country.
The petrochemical pivot made more strategic sense on paper—Edison was entering a capital-intensive, infrastructure-heavy industry not unlike electricity generation. But Valerio underestimated two critical factors: Eni's state backing gave it unlimited access to capital and political protection, while Montecatini had decades of accumulated expertise Edison couldn't match.
Due to the growing increase in competition at the national level, the economic results achieved by Edison between the late 1950s and early 1960s could not be said to be satisfactory. Just think that in 1961 all the subsidiaries active in the chemical field closed in loss.
The forced merger with Montecatini in 1965 effectively ended Edison as an independent entity for nearly three decades. The company that had illuminated La Scala was now a subdivision of a chemical conglomerate, its proud name reduced to a historical footnote.
Part IV: The Montedison Rollercoaster (1978-1993)
Rebirth Through Spin-Off
In 1991, Montedison revived the name Edison to rebrand SELM, a spin-off company into which all its energy assets had been put in 1978.
This seemingly technical corporate restructuring represented something more significant: the recognition that energy assets had distinct value and required focused management separate from chemical operations. The Edison name—dormant for over two decades—was dusted off and attached to these energy holdings.
Enter Raul Gardini: The Peasant Who Would Be King
Few figures in Italian business history are as simultaneously celebrated and tragic as Raul Gardini. Raul Gardini (June 7, 1933 – July 23, 1993) was an Italian agri-business and chemicals tycoon. In 1980, he took the helm of his father-in-law Serafino Ferruzzi's family business, starting an aggressive campaign that led to the acquisition of the French sugar and paper company Beghin-Say SA, turning Ferruzzi into Europe's leading sugar producer.
In 1985, Gardini focused his interest on chemicals and bought stock in the Montedison chemical group. By 1987, he had acquired 42 per cent of the group, turning Ferruzzi-Montedison into Italy's second largest industrial group after the state-owned company Eni.
Gardini's nickname—"il contadino" (the peasant)—captured both his origins and his outsider status in Milan's corporate elite. Gardini was frequently characterized by contemporaries as a charismatic and audacious leader, embodying the aggressive entrepreneurial spirit of 1980s Italy, with a bold, upfront style likened to American venture capitalists. His risk-taking propelled the Ferruzzi group from a regional agri-business into a multinational conglomerate.
The Enimont Catastrophe
In 1989, Eni and Montedison formed a joint-venture called Enimont. The concept seemed logical: combine Montedison's chemical assets with Eni's resources to create a national chemical champion.
The conquest of Montedison was actually the beginning of Gardini's troubles and for Ferruzzi. While it allowed the Ravenna group to launch the research and agriculture-industry integration projects that Gardini cared about, the adventure in Montedison created the conditions for the birth of Enimont, the joint venture with Eni, which instead of putting Italian chemistry in private hands, as Gardini dreamed, became the fatal rock for Ferruzzi.
As president of Montedison, Gardini played a major role in 1989 in the short-lived merger of Montedison and the state energy enterprise ENI to form the Enimont conglomerate. The enterprise collapsed in December 1990 in a dispute over how it should be run.
The dispute between Gardini and Eni's leadership was fundamental: should Enimont be run as a private enterprise or as an arm of state industrial policy? Gardini declared his intention to take majority control of Enimont and on February 24, 1990 uttered the famous phrase "Italian chemistry is me." For his part, ENI President Gabriele Cagliari refused the proposal for a capital increase, worsening the clash between the public and private sides.
The Mother of All Bribes
What emerged from the Enimont saga would rock Italian politics to its foundation. Prosecutors alleged that Gardini paid approximately $140 million in bribes—dubbed "the mother of all tangenti" (kickbacks)—to secure political support for dissolving the parity-based joint venture in 1990, allowing Montedison to acquire ENI's stake at an undervalued price.
Garofano explained why Gardini decided to "give in to the blackmail of the political system" and confessed in detail the entire Enimont mega-bribe: over 150 billion lire (75 million euros) paid between 1990 and the 1992 elections to the five government parties and dozens of parliamentarians and faction leaders. In exchange, Montedison exited Enimont by cashing in from Eni, that is from the Italian State, over 2,800 billion lire (equal to 1.4 billion euros).
The scandal culminated in tragedy. In 1993, Gardini was embroiled in the Tangentopoli scandal following a failed bid to take control of Enimont. In the same year, he committed suicide in Milan.
It was the second suicide of a business leader in Milan in four days, both apparently connected with the massive corruption scandal that has devastated Italy's business and political world for 18 months. On Tuesday, Gabriele Cagliari, 67, former president of the state energy enterprise ENI, committed suicide in Milan's San Vittore jail where he had been held for more than four months.
The Tangentopoli investigations would eventually result in convictions of numerous Italian politicians and fundamentally reshape the country's political landscape—the entire postwar political system essentially collapsed under the weight of corruption revelations.
For Edison, the Montedison-Enimont saga represented the nadir of its corporate history: the company was entangled in scandal, burdened with debt, and controlled by a disgraced conglomerate. Yet from this wreckage would eventually emerge a cleaner, more focused energy company.
Part V: Liberalization and the Battle for Edison (1999-2012)
The Bersani Revolution
Italian Legislative Decree no. 79 of March 16, 1999 (informally called the Bersani Decree in honour of the then Minister of Industry, Pierluigi Bersani) represented a turning point in the Italian energy market: the result of European ratings in favour of the liberalisation of competition between service operators and the opening up of the free market.
In 1999, the Bersani decree liberalized the Italian energy market and reintroduced competition in the electric market, and later the Letta decree opened up the natural gas market, allowing Edison to begin supplying electricity to eligible customers.
The Bersani Decree demolished this monopoly and separated the different phases of the energy cycle into different structures. Now, there are more than 4,500 companies (excluding small independent producers) in energy production, with an additional 470 sales companies.
For Edison—now a separate entity from the remains of Montedison—liberalization created an opportunity to return to its original purpose: generating and selling electricity. But the company needed capital and strategic direction.
The 2001 Hostile Takeover
In 2001, a successful hostile bid to acquire Montedison (that controlled Edison as a subsidiary) was launched by Italenergia SpA, a consortium set up by Fiat, Electricité de France, Sanpaolo IMI, Banca Intesa, and other investors. Following the takeover, Montedison was reorganized by selling all its nonenergy assets.
In 2002, Montedison was merged with Edison, Sondel, and Fiat Energia under the name of Edison SpA.
The Italenergia consortium represented an unusual alliance: Italy's dominant industrial company (Fiat), France's state-owned electricity giant (EDF), and major Italian banks. EDF's involvement signaled French interest in the Italian energy market that would eventually result in complete control.
EDF's Tightening Grip
In 2005, Transalpina di Energia, a consortium set up by Electricité de France and A2A, purchased 63.3% of the common shares of Edison from Italenergia.
The 2012 final takeover merits careful examination. The deal valued Edison at approximately €3.8 billion—a significant sum but arguably undervaluing the company's long-term potential given Italian energy market dynamics.
Edison, which was fully acquired by EDF in 2012, remains one of Italy's largest integrated energy companies, operating power generation, retail, and gas units with annual revenue of about €15 billion and EBITDA near €1.7 billion.
For Italian economic nationalists, EDF's acquisition of Edison represented a troubling pattern: foreign (specifically French) acquisition of strategic Italian assets. EDF had outmaneuvered potential Italian buyers, and Europe's oldest energy company was now a subsidiary of a French state-owned enterprise.
Part VI: The EDF Era — Stability and Strategic Constraint (2012-2019)
New Management, New Direction
Following the EDF acquisition, Edison underwent significant restructuring under French ownership. The chairman of the board is Luc RĂ©mont (CEO of EDF) and the chief executive officer is Nicola Monti.
Nicola Monti was born in Varese (Italy), on July 6, 1962. Nicola Monti joined Edison in 1999, as head of international development, and oversaw Edison's entry to the electricity generation market in Greece, the development of gas interconnections with Algeria and Greece and the start-up of gas import and sale activities in Spain.
In 2007, he became head of development of the Exploration and Production division. In 2017, he also assumed the position of Executive Vice President of EDISON's Power Asset and Engineering Division. On June 19th, 2019 he was appointed Director of the Board of Edison and from July 1st 2019 he is also in charge as Edison Chief Executive Officer.
Monti's background—international development, exploration and production, power assets—positioned him to navigate Edison's complex portfolio and its relationship with EDF.
Market Position Under French Ownership
Edison's primary activities are production and distribution of electricity and natural gas. Edison and its subsidiaries operate across Europe, Africa, and the Middle East. Edison is the second-largest power producer in Italy (about 15% of national output) and in Greece (about 12% of national output).
As of 2016, Enel dominated the Italian retail electricity market, with a market share of 35% and it sold 94 TWh. Edison is the second largest supplier, with 5% of the market.
The Italian energy market remained intensely competitive. Enel—itself once a state monopoly—dominated retail sales. Edison carved out a position as the leading independent alternative, but the gap between first and second place was substantial.
Part VII: The E&P Divestiture — Pivoting to the Energy Transition (2019-2020)
A Strategic Turning Point
Edison (part of the EDF group) signed an agreement with Energean Oil and Gas to sell its 100% stake in its oil and gas exploration and production (E&P) subsidiary Edison E&P for US$750 million (€665 million), with an additional consideration of US$100 million contingent on the commissioning of Cassiopea development gas project in Italy.
This decision represented one of the most significant strategic pivots in Edison's modern history. After a century and a half of energy production in various forms, Edison was deliberately exiting upstream oil and gas—the very business that had once seemed like a natural diversification from electricity.
This transaction is part of Edison's divestment plan from hydrocarbon exploration and production activities in order to focus on sustainable development, in line with the energy transition and national decarbonisation targets. Edison will invest in Italy in the short term the financial resources made available by the sale of these assets to support the development plan in the areas identified as strategic, which are generation from renewable sources and latest gas technology, services to final clients, energy efficiency services and sustainable mobility.
The Deal Economics
Edison E&P's portfolio of assets includes producing assets in Egypt, Italy, Algeria, the UK North Sea and Croatia, development assets in Egypt, Italy and Norway. The Edison E&P portfolio adds working interest 2P reserves of 292 mmboe and 2018 net working interest production of 69 kboe/d.
The final transaction terms evolved significantly from the initial announcement. Energean negotiated a total of $466 million of discounts for its acquisition of Edison E&P, the headline cost of which was reduced to $284 million from an initial $750 million.
The enterprise value of the transferred assets is 284 million USD and the benefit on Edison net financial position with the transaction is equal to around 230 million USD. The agreement provides for an additional consideration of up to 100 million USD subject to the commissioning of Cassiopea development gas project in Italy.
The significant reduction in final transaction value reflected pandemic-era disruption, asset perimeter changes (Algeria was excluded), and changed market conditions. For Energean, the acquisition transformed it into "a key milestone along our path to becoming the leading independent, gas-producer in the Mediterranean."
For Edison, despite the reduced proceeds, the transaction achieved its strategic purpose: freeing capital and management attention for the energy transition.
Part VIII: The 2023 Strategic Plan — Betting on the Energy Transition
€10 Billion Investment Vision
Edison accelerates Italy's path towards energy transition through a plan that envisages investments of 10 billion euros between 2023 and 2030, 85% of which will be in line with the United Nations' Sustainable Development Goals. A transformation that leverages the excellence of the professional and human skills already in the Company and the forecast of hiring an average of around 300 people per year between now and 2030.
With this plan, the Group aims to double EBITDA to a range between EUR 2 and 2.2 billion by 2030 from 1.1 billion euros in 2022.
The math is ambitious: doubling EBITDA in under a decade requires not merely incremental growth but fundamental transformation of the business portfolio.
Renewable Energy Expansion
In the area of electricity production, Edison aims to reach 2030 with: 5 GW of installed renewable capacity between wind, photovoltaics and hydropower compared to the current 2 GW.
The company said this goal will be achieved by a significant change in the industrial portfolio, which will result in direct zero or near-zero emission activities accounting for 70% of EBITDA, compared with an average of 35% over the past three years. Edison added that its 2030 business portfolio will see zero-emission electricity generation accounting for more than 45% of the group's profitability.
Portfolio Transformation Target
| Metric | 2022 Baseline | 2030 Target |
|---|---|---|
| EBITDA | €1.1 billion | €2.0-2.2 billion |
| Green Capacity | 2 GW | 5 GW |
| Zero/Near-Zero Emission EBITDA | ~35% | 70% |
| CO2 Emission Factor | 293 g/kWh | 190 g/kWh |
Edison aims to reduce its CO2 emission factor from 293 grams per kWh in 2022 to 190 grams per kWh in 2030 and up to 50 grams per kWh in 2040, reducing absolute emissions in parallel.
Part IX: The Business Today — A Multi-Segment Energy Platform
Power Generation: The Industrial Core
Edison SpA is principally engaged in procurement, production, and sale and supplying electricity, gas and energy, and environmental services to families and businesses. The company operates through three segments: Electric Power Operations which produces electricity through hydroelectric, wind power, solar and biomass resources; Gas Operations which are engaged in the procurement and sale of natural gas; and Corporate Activities and Other.
It generates maximum revenue from the Gas Operations segment.
The current asset base reflects decades of accumulated infrastructure:
Power generation: operates natural-gas and combined-cycle power plants across Italy, with a total installed capacity exceeding 7 GW.
2024 Financial Performance
Edison's 2024 results showed revenues at 15.4 billion euros, EBITDA at 1.7 billion and profit at 403 million euros. On the sustainability front, Edison achieved a reduction of Scope 1 emission factor by 15%, from 284 to 240 grams of COâ‚‚ per kWh.
Across 2024, renewables, flexibility, customers activities and services accounted for 55% of Edison's EBITDA, up from 43% in 2023.
This shift—from 43% to 55% of EBITDA from sustainable activities in a single year—demonstrates real strategic execution, not merely aspiration.
2025 Outlook
Based on the current market situation, characterised by a decreasing trend in energy prices, the Edison Group expects an EBITDA between 1.2 and 1.4 billion euros in 2025. The decrease in EBITDA compared to 2024 will not necessarily have a proportional reflection on the 2025 net result.
Looking ahead, based on the latest results, the company expects EBITDA of between EUR 1.3 billion and EUR 1.4 billion for 2025.
The anticipated EBITDA decline reflects normalized energy prices after the 2022-2023 crisis period, not operational deterioration.
Part X: Future Bets — Nuclear, Hydrogen, and Offshore Wind
The Nuclear Renaissance
Leading Italian energy player Edison has announced its ambition to construct two nuclear power plants based on EDF's small modular reactor technology between 2030 and 2040, if the conditions are created for the return of nuclear energy to Italy. In particular, Edison aims to build two nuclear power plants of 340 MW each with SMR technology between 2030 and 2040, leveraging on distinctive technological competencies of the shareholder EDF.
Italy's relationship with nuclear power is fraught. Italy operated a total of four nuclear power plants starting in the early 1960s but decided to phase out nuclear power in a referendum that followed the 1986 Chernobyl accident. It closed its last two operating plants, Caorso and Trino Vercellese, in 1990.
Italy banned nuclear energy after it was rejected in a national referendum in 1987 and another in 2011. Monti acknowledged that the return to nuclear power would be a difficult and long path.
Despite this history, Italian government policy under Prime Minister Meloni has shifted toward reconsidering nuclear power. The initiative aligns with Italy's strategic shift in energy policy under the government of Prime Minister Giorgia Meloni, which is considering reviving its dormant nuclear sector.
EDF, Edison and the Italian National Agency for New Technologies, Energy and Sustainable Economic Development (ENEA) signed a memorandum of understanding in January 2025 to explore the adoption of SMR technologies in industrial settings. The collaboration will focus on the critical technical and scientific aspects necessary for SMR deployment.
The first reactor is expected to be operational by 2035, followed by the second five years later, according to Edison executive Lorenzo Mottura. Initial SMR technologies will be ready by 2030, to be followed by testing phases.
The Puglia Green Hydrogen Valley
The Puglia Green Hydrogen Valley proposes to build three green hydrogen production plants in Brindisi, Taranto and Cerignola (Foggia) with a combined capacity of 220 MW, powered by a photovoltaic production capacity of 380 MW.
The Puglia Green Hydrogen Valley was awarded funding under the IPCEI (Important Projects of Common European Interest) "Hy2Infra" call for up to 370 million euros, confirming its strategic importance and viability. Hy2Infra is the third wave of IPCEI to support the development of hydrogen infrastructure in Europe and involved 32 companies and a total of 33 projects. Puglia Green Hydrogen Valley is one of the three Italian projects to have obtained funding.
The Brindisi plant, which is currently in an advanced development stage, has an electrolysis capacity of 60 MW while the Taranto hub has a higher capacity of 100 MW.
Floating Offshore Wind: The Sicily Project
Wind Energy Pozzallo is the owner of a project for the development of a floating offshore wind plant with an installed capacity of 975 MW off the coast of Pozzallo in Sicily, over 25 km from the shore, currently in the authorization phase with Italian Ministry of the Environment (MASE).
The plant's estimated annual CO2 emission reduction is over 780,000 tons. Edison has acquired 50% of Wind Energy Pozzallo's shares, entering into a partnership with Blunova SpA. The agreement aligns with Edison's growth plan to increase its green capacity from 2 GW to 5 GW by 2030.
Italy, with just one operational offshore wind farm to date, has not yet developed any floating offshore wind farms.
The Pozzallo project represents a bet on emerging technology in an underdeveloped market—precisely the kind of positioning that characterized Edison's original founding.
Part XI: Recent Developments — EDF's Strategic Review and the Potential IPO
The Renationalization Catalyst
The potential relisting of Edison must be understood in context of EDF's own transformation. The full renationalization of EDF was completed in June 2023.
Following privatization, decades of under-investment, and the 2021–2022 global energy crisis, the French government announced the full renationalisation of the company for an estimated cost of €5 billion, which it completed on 8 June 2023.
Since being fully renationalized in 2023, EDF has been under pressure from President Emmanuel Macron's government to finance up to six new EPR2 reactors and extend the life of the existing fleet. That program could require more than €60 billion through the 2030s, prompting asset reviews that include potential divestments.
Edison's IPO Potential
Electricite de France SA is weighing a relisting of its Italian unit Edison SpA in Milan, as the French utility faces mounting capital expenditure on its nuclear projects in its home country.
Edison SpA is ready to return to the public market if its French parent approves a plan to relist through an initial public offering. "I believe there's no doubt EDF will keep considering its participation in the Italian market as strategic," Edison's Chief Executive Officer Nicola Monti said.
The company is expected to appoint financial advisers before the end of October 2025 and could bring Edison back to market in mid-2026, depending on market conditions. EDF is reportedly considering selling 30-35% of Edison's shares while retaining majority control.
Edison's potential market valuation is estimated between €7 billion and €10 billion ($8-11.6 billion), according to sources cited in reports.
EDF has enlisted advisers Intesa Sanpaolo IMI and Lazard to help pull fresh value from Edison, its major Italian business.
EIB Financing Support
The European Investment Bank (EIB) is providing up to €800 million to support Edison's investment plan to promote Italy's energy transition. The EIB funds will be allocated through several loan agreements. The first €200 million agreement was signed during a meeting between EIB Vice-President Gelsomina Vigliotti and Edison Chief Executive Officer Nicola Monti at Palazzo Edison.
In 2023, Edison's strategic plan formalised the commitment to make investments that are 75% aligned with the EU taxonomy by 2030. Last year, 55% of the company's earnings before interest, taxes, depreciation and amortisation (EBITDA) was derived from renewables, flexibility instruments, customers and services.
Part XII: Playbook — Business and Investing Lessons
Lesson 1: Surviving Nationalization Requires Strategic Patience
Edison's 1962 nationalization stripped away its entire core business overnight. The company's initial response—diversifying into petrochemicals and supermarkets—failed catastrophically. Yet the entity survived, eventually re-emerging as a pure-play energy company.
The key insight: when regulatory action destroys a business model, panic diversification often compounds the damage. The Edison name and assets ultimately found their way back to energy, but the journey took nearly 30 years of wandering in the wilderness of unrelated diversification.
Lesson 2: The Dangers of Unrelated Diversification
The Standa supermarkets acquisition stands as a cautionary tale. Utility executives convinced themselves that capital allocation skills and customer relationships would translate across industries. They could not.
Strategic adjacency matters. Edison's eventual return to energy—first through Montedison's energy spin-off, then through pure-play restructuring—succeeded because it reconnected the company with its genuine competencies.
Lesson 3: Foreign Ownership Creates Both Opportunities and Constraints
EDF's ownership has provided Edison with capital stability, access to advanced technology (particularly nuclear), and a strategic framework that smaller Italian peers lack. However, it has also created strategic constraints—Edison's decisions must serve both Italian market opportunities and EDF's broader European ambitions.
The potential IPO represents an attempt to resolve this tension: EDF would retain strategic control while allowing Edison greater operational independence and access to public market capital.
Lesson 4: Timing the Energy Transition
The 2020 E&P divestiture appears in retrospect as a well-timed strategic pivot. Edison sold upstream oil and gas assets before the market fully priced in energy transition pressures, redeploying capital toward renewables and efficiency services.
For investors, this demonstrates the importance of management teams willing to cannibalize existing businesses before external forces do so involuntarily.
Lesson 5: Heritage as Strategic Asset
Edison's 140-year history provides tangible assets: hydroelectric infrastructure in the Alps, deep expertise in Italian regulatory frameworks, brand recognition across the country. These are not merely historical curiosities but genuine competitive advantages that new entrants cannot replicate.
Part XIII: Competitive Analysis — Porter's 5 Forces and Hamilton's 7 Powers
Porter's 5 Forces Analysis
Threat of New Entrants: MEDIUM
Capital requirements for traditional generation remain high, but renewable project development has attracted numerous new competitors. Italy's regulatory framework—while complex—provides clear pathways for new entrants with sufficient capital and local expertise.
Supplier Power: MEDIUM-HIGH
Edison's gas operations depend heavily on international suppliers, creating exposure to geopolitical risks (as demonstrated during the 2022 energy crisis). Renewable equipment has become increasingly commoditized, reducing supplier leverage in that segment.
Buyer Power: MEDIUM
Industrial customers maintain alternatives and can negotiate effectively. Retail customers face meaningful switching costs but increasingly shop for competitive rates. Italy's gradual market liberalization has increased buyer sophistication.
Threat of Substitutes: HIGH and RISING
Self-generation via rooftop solar, battery storage, and demand-side management technologies all erode traditional utility economics. The same energy transition driving Edison's strategic pivot also empowers customers to bypass traditional utilities entirely.
Competitive Rivalry: HIGH
One of Edison's 48 competitors is Enel (Electric Utilities), a Corporation company based in Rome, Italy.
Edison competes against Enel (the former monopolist and still dominant player), Eni (a gas-focused competitor), A2A (a regional utility), and numerous renewable-focused entrants. Market share gains require genuine competitive advantage, not merely capital deployment.
Hamilton's 7 Powers Analysis
| Power | Edison's Position | Evidence |
|---|---|---|
| Scale Economies | MODERATE | Significant in hydroelectric operations; less relevant in competitive gas trading |
| Network Effects | LOW | Energy is largely a commodity; network effects are limited |
| Counter-Positioning | MODERATE | Energy transition positioning creates some incumbent hesitation |
| Switching Costs | MODERATE | Industrial contracts create stickiness; retail switching is increasing |
| Branding | LOW-MODERATE | Heritage provides recognition but limited pricing power |
| Cornered Resource | MODERATE | Alpine hydroelectric concessions provide enduring advantage |
| Process Power | LOW-MODERATE | Operational expertise exists but is replicable |
The most defensible aspect of Edison's position is its cornered resource in Alpine hydroelectric capacity—these concessions represent irreplaceable assets that cannot be replicated by competitors regardless of capital availability.
Part XIV: Key Performance Indicators for Ongoing Monitoring
KPI #1: Renewable EBITDA Percentage
The single most important metric for tracking Edison's strategic transformation is the percentage of EBITDA derived from renewable and sustainable activities. In 2024, renewables, flexibility, customers activities and services accounted for 55% of Edison's EBITDA, up from 43% in 2023.
This metric captures whether the company is successfully executing its energy transition strategy or merely talking about it. The 2030 target of 70% provides a clear benchmark for progress assessment.
KPI #2: Green Installed Capacity Growth
Edison's stated goal of reaching 5 GW of green capacity by 2030 from approximately 2 GW today requires consistent execution on project development. Tracking quarterly updates on wind, solar, and hydroelectric capacity additions reveals whether the company is maintaining appropriate development velocity.
KPI #3: CO2 Emission Factor
Edison aims to reduce its CO2 emission factor from 293 grams per kWh in 2022 to 190 grams per kWh in 2030.
The 2024 result of 240 g/kWh represents meaningful progress. This metric is particularly valuable because it cannot be gamed through accounting—it reflects actual physical transformation of the generation fleet.
Part XV: Bull Case and Bear Case
The Bull Case for Edison
Energy Transition Beneficiary: Edison's strategic positioning aligns with structural shifts toward renewable energy, efficiency services, and decarbonization. The company has demonstrated execution capability (55% sustainable EBITDA in 2024) and maintains ambitious but achievable targets.
Potential IPO Catalyst: Relisting at €7-10 billion valuation could attract new investor attention, improve liquidity, and provide capital for accelerated growth. EDF retention of majority control ensures strategic continuity while enabling greater operational independence.
Infrastructure Scarcity: Edison's hydroelectric assets represent irreplaceable infrastructure with multi-decade concessions. As Italy pursues electrification goals, these assets become more valuable, not less.
Nuclear Optionality: If Italian policy shifts toward nuclear acceptance, Edison—through its EDF relationship—holds the strongest position among Italian energy companies to develop SMR projects.
European Policy Tailwinds: EU climate policy, REPowerEU energy security initiatives, and Green Deal funding all support Edison's strategic direction. The EIB financing will cover more than the standard 50% of the total cost of the projects due to their significant contribution to REPowerEU objectives. This means the EU bank will be able to finance up to 75% of the total cost.
The Bear Case for Edison
EDF Strategic Constraints: Edison's decisions must ultimately serve EDF's interests, which may not always align with optimal Italian market positioning. French nuclear priorities could compete for capital and management attention.
Competitive Intensity: The Italian energy market is highly competitive with established players (Enel, Eni) and new renewable-focused entrants. Edison's second-place position is maintained but not expanding significantly.
Nuclear Uncertainty: Italian public opinion on nuclear power remains skeptical. The SMR strategy assumes regulatory acceptance that may not materialize, creating potential for stranded planning investments.
Commodity Price Volatility: The decrease in EBITDA expected in 2025 reflects energy price normalization. Edison's results remain exposed to wholesale energy price movements, creating earnings volatility.
Technology Disruption Risk: Distributed generation, battery storage, and demand-side technologies could erode traditional utility economics faster than Edison can adapt. The company's large thermal fleet represents legacy asset exposure.
Execution Risk: The €10 billion investment plan requires sustained capital deployment over seven years. Project delays, cost overruns, or permitting difficulties could derail the transformation timeline.
Conclusion: Europe's Oldest Energy Company Faces Its Latest Reinvention
In December 1883, Giuseppe Colombo's power plant illuminated La Scala and launched Italy's electrical age. One hundred and forty years later, Edison finds itself at another inflection point—this time pivoting from fossil fuels to renewables, from upstream production to downstream services, and potentially from private ownership back to public markets.
The company's survival through nationalization, scandal, hostile takeovers, and foreign acquisition speaks to institutional resilience that transcends any individual leader or strategy. Yet survival is not the same as thriving.
For long-term investors, Edison presents a distinctive opportunity: a company with genuine heritage advantages (hydroelectric infrastructure, regulatory expertise, brand recognition) deliberately repositioning for the energy transition. The 2030 strategic plan is ambitious but not fantastical—the 2024 results demonstrate meaningful execution against stated targets.
The potential EDF IPO adds complexity and opportunity. A successful listing would provide Edison with independent access to capital markets while maintaining strategic alignment with Europe's largest nuclear operator. The €7-10 billion implied valuation range suggests meaningful upside potential if execution continues.
The risks are equally tangible: commodity price exposure, competitive intensity, regulatory uncertainty around nuclear, and the ever-present possibility that technology disruption could strand legacy assets faster than anticipated.
Yet Edison has navigated existential threats before—nationalization in 1962, the Tangentopoli scandal in 1993, the post-Montedison restructuring in the 2000s. Each time, the company emerged transformed but intact.
As CEO Nicola Monti observed at the company's 140th anniversary: "140 years ago we started the process of electrifying the country and ushered in a new era. Today, we are a leader in the energy transition and our history of leadership has accustomed us to responsibly looking to the future of the country."
Whether Edison can translate that 140-year heritage into another century of relevance depends on execution against an ambitious transformation plan—and the ability to recognize the next technological inflection point before competitors do.
For Giuseppe Colombo, that inflection point was the incandescent light bulb. For today's Edison, it may be small modular reactors, floating offshore wind, or green hydrogen. The challenge remains the same: seeing the future clearly enough to build infrastructure for it before others do.
Edison SpA (EDNR.MI) trades on Borsa Italiana with savings shares publicly listed. A potential IPO of ordinary shares is under consideration but not yet confirmed.
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