ENGGF - Enagas Sees Remuneration Reductions But Still Offers Inflation Protection And Opportunity In Hydrogen

• Enagas, like all Spanish regulated utilities, needs to deal with the stingy CNMC, however, recent changes improve the investment thesis.
• Unlike before when they were remunerated on a straight-line basis, now they are compensated on regulatory WACC giving them an inflation hedge.
• Moreover, hydrogen opportunities protect their remuneration rate.
• Remuneration declines will be substantially reduced for the next 5 years and in the long term, improving Enagas’ risk profile substantially.

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