July 7, 2011 / 3:40 PM / in 9 years

Enel aims to switch oil plant to coal in June 2012

* Porto Tolle plant conversion to coal depends on new laws

* Italy top court stopped Enel’s coal conversion plan in May

* Enel committed to 2.5 bln euro conversion project

MILAN, July 7 (Reuters) - Italy’s biggest utility, Enel , hopes to start its long-term project to convert a major power plant to coal from fuel oil in June 2012, betting on new laws to bypass a top court decision blocking the project.

Italy’s top administrative court, the State Council, in May cancelled government clearance for Enel’s 2.5 billion euro ($3.58 billion) Porto Tolle conversion project which was opposed by environmentalist groups.

“Enel is committed with ministries and regional authorities to find a solution to start works. It is reasonable to think that it would be possible to start works in June 2012, depending on all necessary administrative procedures,” an Enel spokesman said.

Authorities of the north-eastern region of Veneto, where the Porto Tolle plant is located, have drafted a law which would allow the conversion of oil-fuelled power plants to coal or any other fuel if it cuts greenhouse gases emissions by 50 percent.

Enel hopes Italy’s Environment and Industry Ministries would give their approval to the new regional law by March next year, the group’s spokesman said.

Another boost to Enel’s plans could come from Italy’s new austerity budget which includes a special measure permitting conversion of oil-fuelled power stations to a clean coal technology, Enel’s Chief Executive Fulvio Conti said on Wednesday.

“Enel’s will is to go ahead with the 2.5 billion euro investment into Porto Tolle,” the spokesman said.

Enel had planned to start at the end of this year converting its 2,640 megawatt oil-fuelled Porto Tolle plant on the River Po about 100 km from Venice, to use clean coal technology, part of its drive to cut carbon emissions.

Coal-fired plants are a major source of carbon dioxide (CO2) emissions and the project came under fire from environmentalist groups.

Enel had also planned to invest another 1 billion euros in a carbon capture and storage facility on the site to reduce its CO2 footprint.

Conversion works at Porto Tolle had been expected to last 72 months giving work to about 3,000 people. The plant’s capacity is expected to be cut to 1,980 MW and the facility would employ about 1,000 people when the conversion is completed.

It took Enel about 6 years to get the Environment Ministry’s approval which was scrapped by the State Council. ($1=.6991 Euro)

Reporting by Svetlana Kovalyova

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