Research Update: Electricity Utility Enel Chile S.A. And Its Subsidiary Enel Generacion Chile 'BBB+' Ratings Affirmed; Outlook Stable

Chilean electricity utility Enel Chile S.A. (Enel Chile or the company) continues to grow renewables and seeks to add almost 2GW of installed capacity by 2022, with half of that under construction. In addition, the company decided to anticipate the date of disconnection of its two coal plants (Bocamina I and Bocamina II with an aggregate capacity of 478 MW) and will become the first electricity company to phase out its coal fleet by 2022. The execution of this plan will cost about $1.9 billion from 2020-2022. We view Enel Chile's strategy as positive from a credit standpoint, because it will enhance the company's already leading competitive position in the Chilean market. However, we now expect the leverage metrics to

...- Chilean electricity utility Enel Chile S.A. (Enel Chile or the company) continues to grow renewables and seeks to add almost 2GW of installed capacity by 2022, with half of that under construction. In addition, the company decided to anticipate the date of disconnection of its two coal plants (Bocamina I and Bocamina II with an aggregate capacity of 478 MW) and will become the first electricity company to phase out its coal fleet by 2022. The execution of this plan will cost about $1.9 billion from 2020-2022. - We view Enel Chile's strategy as positive from a credit standpoint, because it will enhance the company's already leading competitive position in the Chilean market. However, we now expect the leverage metrics to be higher than in the past, with net debt to EBITDA peaking at about 3.3x in 2020, and then decreasing to approximately 2.5x by 2022, when most of the new capacity will be fully operational. - On Aug. 18, 2020, S&P Global Ratings affirmed its '###+' long-term issuer credit...

Research Update