Millions of euro
Property, plant and equipment
Other impairment losses
Other reversals of impairment losses
In 2019, depreciation, amortization and other impairment losses essentially reflect the impairment losses recognized on a number of coal-fired plants in Italy, Spain, Chile and Russia for a total of €4,010 million, including related decommissioning charges. These impairment losses are essentially attributable to:
- the reduced competitiveness of plants with higher CO2 emissions compared with other technologies, particularly in Spain and Italy, based on the changing characteristics of the market in terms of commodity prices and increased compliance costs in relation to CO2 emissions, as well as the additional penalties, particularly in Italy, due to introduction of new capacity-market regulations for the remuneration mechanism for available capacity, which restricts the scope of application for plants with higher CO2 emissions;
- agreements with the Chilean government for the early decommissioning of the Tarapacá and Bocamina I coal-fired plants (by May 31, 2020, and December 31, 2023, respectively) within the scope of the decarbonization process that has begun in the country (€356 million);
- the adjustment (€127 million) to the fair value of the Reftinskaya plant as a result of its classification as held for sale following the binding agreement approved by the parties in June 2019.
The change also includes the depreciation of right-of-use assets, which, as of January 1, 2019, are subject to depreciation over the term of the lease agreement in application of IFRS 16 (€203 million).
These effects were partially offset by reversals of impairment for gas plants in Italy in the amount of €265 million in response to impairment testing.
In 2018, this aggregate included the impairment of biomass assets in Italy (€94 million), of the assets of Nuove Energie (€24 million), of the Augusta and Bastardo power plants (€23 million), and of the Alcúdia power plant in Spain (€82 million). These effects were partially offset by the reversal of impairment for the Hellas CGU (€117 million).