Krungsri sees 2 power plant M&A deals supporting GULF and EGCO targets

Spain's upcoming general election could reshape the country's energy policies, creating opportunities and risks for utility companies, according to Goldman Sachs. In an October 6 report, Goldman Sachs said a potential government led by the centre-right People's Party could introduce more market-friendly energy policies, including greater support for nuclear power, renewable energy and data centre development. Spain's general election is scheduled for November 29, having been brought forward from August 2027, and polls cited by the bank suggest the People's Party could emerge as the largest parliamentary group. Goldman estimates longer operating lives for nuclear reactors could generate an additional €500 million to €750 million in annual EBITDA for each of Endesa and Iberdrola, depending on electricity prices, while a 10%-20% reduction in retail margins could lower annual pre-tax profits at Endesa and Iberdrola by €120 million to €240 million each, translating into estimated 2027 earnings-per-share reductions of approximately 7% for Endesa and 2% for Iberdrola. The bank also warned that a government transition could further delay hydrogen infrastructure investments, creating uncertainty for Sell-rated Enagas, though it expects the overall impact on most Spanish utilities to be neutral to positive.

Google and Constellation Energy announced a long-term clean energy collaboration that will add 890 megawatts of new nuclear capacity to the PJM grid under a 20-year power purchase agreement. The deal also includes a 15-year, 2,700 megawatt supply agreement and more than US$4.30 billion of nuclear fleet investments supported by Google Cloud's AI technology. The Google contracts follow a separate 20-year agreement with Amazon backing over US$3.00 billion of upgrades and a 190 megawatt uprate at Maryland's Calvert Cliffs plant. Together the contracts show how hyperscale customers are directly underwriting incremental nuclear capacity, life extensions and digital optimization across Constellation's fleet. Constellation Energy's narrative projects $39.9 billion revenue and $6.5 billion earnings by 2029, requiring 8.5% yearly revenue growth and a $3.0 billion earnings increase from $3.5 billion today.

Constellation Energy has landed two 20-year contracts with tech giants in about a week, with Google committing to 890 MW of new nuclear capacity on PJM days after Amazon signed a deal tied to a 190 MW expansion at Calvert Cliffs. Constellation, the largest nuclear operator in the US, runs 55 gigawatts of capacity across nuclear, gas, geothermal, hydro, wind and solar since buying Calpine earlier this year, and sells power to about 2.5 million customer accounts, including 80% of the Fortune 100. The company will invest more than $4.3 billion to upgrade 11 nuclear units across Illinois, Pennsylvania and New Jersey, with the first uprate due by 2028, while a separate 15-year agreement covers 2,700 MW from existing plants. Adjusted operating earnings rose to $2.55 a share from $1.91 a year earlier and management raised full-year adjusted guidance to $11.50 to $12.50 a share, though GAAP earnings fell to $1.42 from $2.67. The quarter's 920 MW of new agreements run 15 to 20 years with investment-grade buyers and start between 2029 and 2032, and the Crane Clean Energy Center restart now has its fuel license and a key grid-connection approval, with the company still targeting 2027.