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Involving stakeholders, sharing objectives and impact assessment

4QUALITY EDUCATION

Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all

7AFFORDABLE AND CLEAN ENERGY

Ensure access to affordable, reliable, sustainable and modern energy for all

8DECENT WORK AND ECONOMIC GROWTH

Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all

Looking constantly and proactively to the needs and priorities of society makes it possible to take up new challenges and to redefine an increasingly competitive business model, developing new strategies and innovating in processes such as in commercial offers to customers. The search for “shared value” for the company and all its stakeholders represents an opportunity to combine competitiveness with the creation of social value in the long term, and it is in this field that Enel has focused its activities in recent years. Its presence in such a vast geographical area, which involves both mature and emerging markets, necessarily implies a comparison among differing situations and a deep knowledge of the local area and of the needs of the various interlocutors so as to identify targeted business solutions. Access to energy as the driver for local development is now taking on a wide and innovative variety of forms that can be applied to any context: alongside the traditional power plant there are also smart, off and on grid solutions, new formulae have been identified to combat energy poverty alongside a market offer which is increasingly challenging and technologically advanced for more demanding customers. Such variety is possible only through an inclusive approach right from the first stages of development, identifying the key stakeholders involved in a project and mapping their requirements both as needs and as new growth opportunities. By launching a constant and constructive dialogue, it is thus possible to prevent any negative impacts and to identify solutions which create shared value in the long term. Local needs are connected with the corporate objectives through a materiality matrix which is specific by location, in order to identify those projects and initiatives which respond to the shared priorities. The key word is increasingly “co-creation”: projects are defined and realized together with the communities so that they are calibrated to the specific characteristics of the local territory. 

An inclusive approach towards stakeholders also takes the form of circular economy solutions: for example, waste material such as pallets from construction sites can be transformed into commodities for woodworking or for local crafts, thanks to a targeted capacity-building program. Likewise, infrastructure of plants which are being closed down can be reconverted to other purposes to the benefit of the local territory involving various stakeholders.

Enel has embraced the Open Innovability model, activating a growing number of partnerships worldwide (over 400) with local organizations, social enterprises, universities, international associations and NGOs. Sustainability, innovation and openness to dialogue have always been at the heart of relations with partners who operate internationally (strategic partners) and locally (operational partners). In particular, in 2016 Enel signed a strategic partnership with the Shared Value Initiative, the international network led by Mark Kramer, founder together with Professor Michael Porter of the CSV (Creating Shared Value) model on which Enel’s approach is based.

The Creating Shared Value model

CSV Model (Creating Shared Value)

Through specific context analysis tools, the mapping of stakeholders and the definition of materiality matrices and action plans, the development of a business project is accompanied from the initial exploratory approaches to its final definition. These analyses, and in particular the materiality matrix of the site, enable the identification of short-, medium- and long-term actions which combine the corporate perspective with the needs of the local communities through concrete and acknowledged initiatives. This is all done while guaranteeing particular attention to identifying and protecting ancestral communities which are affected by projects, in compliance not only with Convention 169 of the International Labor Organization and local laws, but above all the respective traditions and cultures.

In 2016, 320 applications5 of the CSV (Creating Shared Value) model were used in the various stages of the value chain: Business Development – BD, Engineering & Construction – E&C, Operation & Maintenance – O&M.

Here below are some examples of CSV projects across the various business areas:

THERMAL GENERATION – IBERIA – BD STAGERethinking the relationship with communities in the Canaries, in Puerto del Rosario

The thermoelectric plant of Las Salinas is a diesel powered generation plant consisting of 12 units, with net installed capacity of 160 MW, which is currently being modernized. It is in the Municipality of Puerto del Rosario, the capital of the island of Fuerteventura in the Canary Isles (Spain) and has been in operation since 1992, when the first production unit was connected to the network.
The presence of urban centers near the Las Salinas facility has required particular handling of the relationship with the community. The plant’s operation has in fact in the past triggered complaints from citizens about the noise levels and the emissions caused by the generators, despite many of the local homes having been built subsequent to the start-up of the plant and the plant’s emission levels conforming to Spanish environmental laws. With the aim of improving the relationship with the local community in a spirit of transparency and development of the local area, a short- and medium-term CSV Plan was drawn up. Through meetings with the main stakeholders and with the city and district associations, as well as thanks to analyses of the socio-economic and political context, the main issues were recorded for the local area on the basis of which the CSV Plan was drafted.

For 2016, as the first year, three areas for action were identified:

  1.  Open Plants. Actions aimed at opening up the plant to the local context with measures aimed at disseminating knowledge of the world of energy and of the company; at facilitating dialogue with citizens; and at promoting visits to the plant and educational programs in schools.
  2. Access to energy for people living in poverty. Programs were developed for “energy volunteering”, involving 25 families through 20 volunteers and training programs for social services in order to optimize invoicing and energy efficiency. In agreement with the local institutions, other initiatives are also being drawn up to protect the most vulnerable categories.
  3. Socio-economic development. Two initiatives have been drawn up: “Actívate y empléate” and “Art Energy”. The first is aimed at young people at risk of social exclusion and offers employment opportunities, while the second is an urban art competition realized in collaboration with the Municipality: eight Endesa transformer stations have been made available as well as the wall of the plant to be decorated with murals painted by local artists and schools.
THERMAL GENERATION – PERU – E&C STAGEPromoting local development in the area of Malacas

The gas powered plant in Malacas has installed capacity of 286 MW and is located in the province of Talara in the north of Peru. In order to increase its efficiency, it was decided to build a new 51 MW TG6 unit, which will take the place of other more obsolete units which are currently in operation. Malacas is the first plant on which the Creating Shared Value (CSV) model has been applied to move from the business development stage of the new unit to the current E&C stage: the results of the analyses, as well as the CSV Plan with the related Capex and Opex of the various projects identified, were an integral part of the assessment of the business project approved by the Investment Committee. 

From the analysis of the socio-economic and environmental context launched in the design stage and from the profound knowledge of the stakeholders which has consolidated over the years of operation of the plant, the following priority issues emerged: protecting the environment which is seriously impacted by waste, the promotion of local entrepreneurship, also in response to the high unemployment rate, and women’s empowerment. The CSV Plan drawn up to address these shared priorities includes various initiatives aimed at improving the quality of life in the long term. Among the early results recorded, the technical apprenticeship program, which involved governmental institutions and entrepreneurs of the Punta Sal and Máncora Beach hotels, trained 30 students in 2016, 12 of whom found employment. The “Olitas Verdes” Program, which seeks to promote tourism in the area and is aimed at young people, held educational workshops on the reuse and recycling of waste and on plans to collect and sell waste from beaches and from areas around the plant. In addition, in agreement with the municipalities, a plan was drawn up to transform the pallets used on site into beach infrastructures, thus increasing the safety of the shoreline and providing more structures for water sports.
In addition, in order to guarantee the utmost transparency towards stakeholders, during the construction works an information panel was installed about the realization of the new TG6 unit, at the same time summarizing the various ongoing social and environmental projects. Since the Malacas plant has been in operation for a number of years, the surrounding area is also involved in other projects which promote better quality of life. Together with the Ministry of Health, in 2016 three disease prevention and dietary education campaigns were promoted, with the carrying out of medical checks and providing assistance to over 760 people. In addition, for the Scuola Santa Elena di Piedritas, which Enel helped to build and electrify, the creation of a sports centre and an IT lab are underway.

THERMAL GENERATION – ITALY – O&M STAGERethinking the relationship with communities at Torrevaldaliga Nord

Enel has a very important role for the local communities present in the area around the Torrevaldaliga Nord plant in Civitavecchia, and for many years has supported initiatives to protect the environment, the health and local development. The innovative CSV approach adopted by Enel aims at a business model which recognizes the strategic value of the interdependence between the company and the social, environmental and economic context in which it operates, and has strengthened in the Company the belief that its role must thus take the form of a contribution to the development of the local communities also from the business viewpoint, with a view to creating shared value.
In 2016 this belief took the form of the search for sustainable initiatives which can generate lasting benefits over time for the communities. The first step was an accurate and detailed analysis of the context (Single Event Effect Criticality Analysis - SEECA), followed by intensive work to consult all stakeholders, in order to identify the intervention areas which are perceived as priorities by the local communities and which offer potential development opportunities for all the local area. Then at the end of 2016 innovative agreements were signed with each of the four municipalities involved (Allumiere, Santa Marinella, Tarquinia, Tolfa) which define collaboration aimed at a process of inclusive and sustainable growth in the local area. In addition, the agreements set out the shared value initiatives which Enel intends to develop together with the local administrations, also through forms of partnership with businesses and/or non-profit associations which are active locally.

In particular, great attention was paid to the issue of resilience with training programs and initiatives aimed at the adoption by the local administrations of a development plan for the town compatible with the environment, to be safeguarded and protected. Again with a view to creating shared value, actions are envisaged to increase the efficiency of public lighting and to promote sustainable transport through the realization of a public cycle path for electric bikes, with networks of recharging points, smart hubs and video surveillance.
In addition, educational films are envisaged aimed at creating new technical and business skills, initiatives in favor of the disabled, and the recovery of sporting structures.
This model marks an important turning-point in the means of managing relations with local administrations in the territories where Enel is present with power plants, and is ready to be adopted also in other areas, starting from the Federico II plant in Brindisi, where the process, which was started at the end of 2016, will be developed during 2017.

INFRASTRUCTURE AND NETWORKS – BRAZIL – BD stageThe acquisition of the CELG network in the State of Goiás

In operation since 1956, CELG is the network of over 200 thousand km in length which links 237 municipalities in the State of Goiás, where there is also the capital Brasília, with around 2.9 million customers served covering residential, industrial, rural, and commercial users and local administrations in a relatively prosperous area of the country.
Enel acquired the CELG network in a competitive process and has planned investments aimed at modernizing and expanding the distribution system to introduce the most advanced automation techniques, integrating the concept of smart networks to improve the quality of services. This project is based on the sustainability of the business and customer satisfaction.
In this light, the operation was accompanied by application of a CSV Plan which, through quali-quantitative analyses of the socio-economic and geographical situation, enabled the identification of three main areas for intervention in the local area:

1. Intelligent energy consumption: the growth of the population generated by migration, in particular in the city of Brasília, has triggered an increase in the propensity to steal energy in a context of widespread violence. In this sense, the following were launched

  • a. actions aimed at the population for safe use of energy;
  • b. the creation of a leadership network to promote and share values;
  • c. a training program on the maintenance of solar panels.

2. Support activities for young people: projects in collaboration with schools, to offer the possibility to students of taking part in cultural and sporting activities by improving leisure facilities and digital inclusion activities.
3. Boost to rural business: most of the rural producers in Goiás are organized in cooperatives and have problems marketing their production and managing their business. In this light the following were planned:

  • a. the construction of a communication platform and Internet access, in order to include small rural producers in the large scale market and to promote business skills;
  • b. the installation of batteries to stabilize energy consumption and to facilitate production processes.
INFRASTRUCTURE AND NETWORKS – ARGENTINA – E&C STAGE – ARGENTINA – FASE E&CEnergy efficiency improves life in the district of Los Piletones

In Buenos Aires, in the district of Los Piletones, the electrification project was started with the installation of smart meters which enable more efficient use of the network and customers in a poor, highly unstable area. The district is characterized by a high percentage of foreign communities (over 60%), by a very high rate of occasional employment equal to 75% and by residents 63% of whom receive State subsidies, where 50% of homes do not have hot water. In such a difficult context, the socio-environmental analysis undertaken during the planning of the installation of the meters recorded as priority, urgent issues: access to energy, protecting the health and safety of the communities, mitigation of the environmental impact and local economic development.

In order to address these needs, while generating at the same time stable conditions for the network, the following initiatives were identified:

  • meetings and workshops with the communities involved to explain the innovations from the new smart meters which can provide information on consumption and allow a choice to be made of the tariffs which are best suited to particular needs, facilitating responsible and optimal use of energy and lower emissions and costs, thus improving the energy efficiency profile; G4-DMA EC G4-DMA HR G4-25 G4-26 72 Sustainability Report 2016
  • educational programs for pre-school and primary school children who are given a teaching kit with material on the history of electricity and on sustainable development with curious facts, games, experiments to do at home and quizzes on energy security, with tips on how to avoid domestic accidents linked to electricity;
  • Illumina: a plan aimed at the promotion of social entrepreneurship with a business incubator, professional training plans and measures for efficient energy use in order to develop the business from the bottom up. In the context of this initiative, activities were planned to install and maintain the district’s public lighting;
  • Vivienda sustentable: information-sharing plan aimed at customers with suggestions for efficient energy use in homes, to optimize natural lighting, turn off lights in empty rooms, paint walls and ceilings with light colors, and replace traditional light bulbs with more efficient LED lighting.
RENEWABLES – MEXICO – BD STAGEThe Mexican way to cooperation between industry and agriculture

In Mexico Enel Green Power signed a collaboration project with the Autonomous University of Chapingo, with the aim of strengthening productive skills (in particular in the agricultural and forestry sector and in research into sustainable irrigation systems) in the Chinampas, Majoma and Primero de Mayo communities located near various wind farms which are at the business development stage such as Villanueva, or at the construction stage such as Palo Alto with 129 MW and Vientos del Altiplano with 100 MW.
For years now the Company has been working to identify and finalize solutions aimed at applying a positive sum model for both the renewable industry and for local farmers. Starting from the experience in Oaxaca, where wind farms coincide with farming areas, the collaboration with the Autonomous University of Chapingo is a step forward in making the agricultural areas of the rural communities around our plants more productive and sustainable from the environmental viewpoint. Thanks to the analyses of the socio-environmental context undertaken during the planning stage of the plant of Vientos del Altiplano, in the area affected by the plant a project has been established which envisages a plan to recover and identify new areas to be used for agriculture and includes the study of a system to collect rainwater. In addition, it is planned to create together with the community six school allotments for the cultivation of medicinal plants, vegetables and high value agricultural produce, in order to seek new market opportunities.
In addition, since the availability of water is a critical factor for the development of agriculture in the region, mainly due to the high salinity levels, a possible treatment is being studied to replace “rainwater” agriculture with irrigation based agriculture, thus enabling up to three annual crop cycles.
In the area of Palo Alto, the project aims to increase the population’s access to agricultural techniques and knowhow. Thanks to the involvement of women, young people and children, who will receive theoretical and practical training, five test environments have been identified as well as five school allotments. Evaluations will be made of the crops, the sowing density, seeds, and organic and traditional management, thus arousing the interest of young people in taking up agricultural work again, using new technologies and production techniques.

Reference SDGs: 
Main actionsTarget
Access to energy3 million beneciaries, mainly in Africa, Asia and Latin America by 2020
Social and economic development1.5 million beneciaries* by 2020
Quality education0.4 million beneciaries by 2020
Implementation of new projects for the support of the communities in which Enel operates in order to create shared value and to foster the energy culture 
Diffusion of the Creating Shared Value (CSV) model in the operational activities (Business Development – BD, Engineering & Construction – E&C, Operation & Maintenance – O&M)
Strengthening of strategic partnership and promotion of operational partnership

* Target updated compared to 500 thousand initial beneficiaries.

Sustainability Plan 2017-2019