francine:nel rocked the markets when s ipo become the world's biggest at the time. three decades later and the company is still thriving as europelargest utility and a dominant player in the sustainable energy spa. greener future with plans to goarbon neutral 2050, and is well on its capacity comes from nonfossil fuel sources. today on "leaders with lacqua,"

we meet the chief executive of .nel, francesco starace thank you for joining at bloomb. to difficult was it for enel to one a coal polluter of theriendly companies in sensible: had renewable energy and a legacy of large hydro plants that most utilities have in europe. now we have a lot more. was, iny it retrospective things always seem easier than they were. was a mind changing exercise on a large-scale, let's put it this way. it took ahile, bhere a point where everything turned around. there were a couple of years where things changed.

francine: what years? 2012-2014. after that, it was faster. francine: if you look at the shift from fossil fuel torenewaa whole, how disruptive will it be for you and your competitors? francesco: it is really disruptive, a big shift. there is a huge change coming. towill take 15-20 years really get at the end of this shift, so a huge transition ongoing with sharks in different parts of the world. install capacity that needs totitu it has been accuver , but it is ongoing and will not stop. francine: what is the catalyst of ce, political power, or

the price of rcame cesco: originally it was a litical decision that without that, it would have taken a longer time, but today is mostly economics driving the change today everywhere in the world. i would say it is no more l. it has been at the beginning. now it ist the pure chnology revolution and the economies that come with it. francine: germany wants narrowly focused companieou want an integrated approach vertically, ancesco: today in the world on the technology front, the technology is incredible because of this renewable wave coming and continuing to change things.

that triggers another change, which is the digital transformation of networks. grids, them distribution t we should call the networks because they work and a network-kind of way. this change coming at us from all sides disrupts the value chain or modifies the value going forward.s difficult i am not sayhe next week or month, but in the next years. wenk it isery dangerous to take a bet and say only best part will be viable in the next years and that part not. i think it will take a while to , if ever, iftand there is a value chain breakdown. francine: what is a while, five years? francesco: i think in 5-10

, you will see the transformation taking place. the value created in managing this transformation ist is at stake today. we think it is much more viable it.anage that is the focus for us. it takes a lot of effort to manage the complexity. francine: is it a software company? utility companies have changed so much. ofncesco: we like to think of utility as an enabler things. energy alone is nothing. the utility should become some body that enables other parts of society to do other things. in that sense, utilities need to keep changing to what society adapts from them. so it is important that

utilities keep broadening the spectrum, not never ring it. francine: do you narrowing it. fr -- francesco: decided to keep, so it will take fothem another year maybe, but after that too late. even if they don't decide, they have decided. francine: why is there a greater acceptance and a greater presence of renewable energy in europe than the u.s.? francesco: because europe started with a political goal, which the u.s. never had. the political angle europe started with is still present in the trajectory of renewables in eurothe u.s. never had that vies , some parts of

california have the same approach. have arts of the u.s. bigger chunk of renewables than others. francine: very well in renewables in the u.s. what is your strategy? frsco: keep going. it is an open ates space of renewals, efficient, .nd l professionals it is one of the best markets, highly competitive, but great space. francine: tfrom power production to serviutilitt step? francesco: the next step for utilities is difficult to say, but there are big parts of the value chain that have opened up. for example, the mobility sp what is the utility role in the evolution of cars, in electricity being used for heating for buildings, for cooking? there are a lot other spaces

in which utilities can play a role. es go down and society uses electricity for things that were not electrified before. doubt in there is no your mind this is the path the world will take? francesco: it is happening everywhere. let's ve this in which -- it will be a long moment -- in which their business is growing because electricity becomes the energy of the fu imagine you sit in a business segment whose basic volume keeps own.ng alone on its that is great. it is a question of being conscious about it. ♪ francine: coming up, the google of energy? to tecrch of the ntenel's

big money winner. ♪

♪ wascine: our company enel -- power company enel was among the first of its kind to bet in paidables, and the bet off, making it one of the biggess in north america, but as incentives dry up, the company is turning to technology and the search fog industries like smart homes and electric vehicles in the hope of landing the next big thing. l, mr. francesco starace.cutive innovation --rive

how do you drive innovation? francesco: sustainability was technologically, and only certain parts, and by the way, nothamuch wneed to have something that drove innovation. the concept we have to have a more sustainable business modeie in the weight weught about the business model, and that was the innovation stimulus we needed. we used the sustainability need to stimulate innovation, then we had a second trick. that was to sa's stop trying to innovate alone and out who is already in outside tt calp us, so open it up to help from outside.

established in parts of the world where we brought problems and asked for innovators to help us. th that helped a lot. francine: is it a website? are you trying to figure something out? aancesco: weh website after. we first went to israel, to silicon valley. moscow,d a hub in rio, santiago. wher saw innovative minds and startup culture, there we put our people and opened a small office and pushed that really, we brought problems. tobrought them problems solve. they said, thanks. we try. we had incredible results with this. we really found thnot thinking a

francine:ow difficult is it do in renewables? there are many more markets, market players. it is little bits, right? francesco: it was a lot like that at the beginning. in fact, there wet of ents because we started trying to develop projects oras that have no subsidy incentives, only competitive battlegrounds. we got criticism at the beginng, why are you so stupid? why don't you invest with our subsidies? because we think subsidies wi end. thing pushability that. we prepared for competition. we prepared for the moment when renewables would be an open, and fiercee

battlegroundgeompetitive advant. francine: you tell them this is my problem. battery b or storage facility. what is that relationship like'r invest. we have partnership. we dt get i why not. ? francesco: it is simple. we are not able to make mistakes. wrongthealy we havif you can'te investments, you better not invest in startups. we said genetically we are not able to do that. let other people do that. and we do is take startups bring them to market quickly and deploy them on the large-scale we have, and do not pretend to have exclusive rights because we want them to becom, available ways of generating

energy for everybody. we see competition between energy sources, not energy plers. become electricity to competitive against other energy sources. that is the fight. francine: how realistic is it that electric vehicles become a meaningful source of revenue for you? francesco: they will. francine: 10 years? francesco: maybe less. today, we are at the beginningsn next year we will all say how stupid we were. billions car manufacturers are throwing into electric vehicle development, you have no doub become a huge business. of course we like the word electric. there is a question whether electric or electric car will prevail.

which of the two words are more portant? francine: think? francesco: we don't care as long as it is electric. francine: you could be talking to facebook or google. manufahat brings these? france no, but manufacturers have the know-how to mass produce things. the real advantage here is do you know how to mass produce millions and means of vehicles in the right way in the less expensive way, the most safe way? that is know how you build over decades, and they have that. francine: what is the number one questior your innovation hub, battery, storage? francesco: it is more about predictability and linkability. what can we do with the data we have come explain things,

predict things looking at the data? today and in the next few years the most important key or capability we lack is the capability to ge concept and analytics in the same range, really difficult. francine: do you think anyone or is that a thing of thets, francesco: no, they still have a future, less than before. before joining enel, i was selling gas to power plants worldwide. i think it is stephanie not the same future net we had 10 years ago. francine: if you look at united nations sustainable development goals. francesco: yes. franci are they too wide? francesco: no they are not wide. they try to improve the world, so they deserve some capacity.

goals, we those 17 focused on four, so we narro ita bit because the business we are in doesn't cover the other stuff. we are working and trying to channel our sustainability efforts into those four, which helps us to m and drive people in the right direction. because to do good is not good enough. you need to do a lot of good have any impact. up, the: coming foresight required to drive enel and the united nations in the renewable space. ♪

francine: throughout his 18 years at enel, francesco starace

has been at the forefront of change in the energy business. roles have included heading up a renewable unit, a leading player isthe industry, but starace not just a leading light at enel . he has been given a key role at delgwith sustaina what kind of skills and foresight does it take the lead in the power space? passionateways been about sustainability, or did it come once you started working in ilities? francesco: it came when i started working in utilities. it comes to when you work at companies that have to do with the society. a company thrives ohe within which it wor in good hands. cannot work well if it does not work in a society. francine: you can say that about

every industry. francesco: yes and no, but utility is a long-term thing. sell furniture and go away and go somewhere else. utilities not t move, so you need to for the society you are in. is sos whyinability important for some industries that have a big impact on society. francine: d look at the business case before it, or was that before? francesco: no. there is obviously a business case. there is no question that the value you share with companies or with people living around you , the value you create can be much more if it is done in an nable way. it is an incredible change. by the way, this triggers a

different line of thinking in utilities, which likely said before is a stimulus to beautifully andinteractive loop requires a little change in the mindset of mers. francine: you must have had les when you started out with that? francesco: i did. i did at the beginning. smallat we did is we used examples and built around those examples. then people bought into them. it was an example building change like that. it worked like that. francine: when you look at clients, how can you tell the companies that do good for real and the ones that just do it for pr reasons? francesco: it is for simple. it is fake versus real concentration. it is about what they say. it is about what they do. in the end, it is about what

they actually end up providingfh them, and it is somethingap the surface and you see immediately. -- scratch the surface and you see immediately. francine: what kind of leader are you, micromanage, overview? francesco: i used to micromanage, then i understood that was the maximum i could do myself. i trust people a lot, basically. i trust a lot my people. threet them to times -- two times or three. that is a lot. but you know what i do? i have a certain age and, so i s happening forward. i always look a couple of steps ahead. then if i see they will make a mistake, i don't try to stop that. i try to go and protect them after so that they learn.

that is what i really do. sometimes they joke with me and say, why didn't you tell us? i prefer that a lot. it works. it works. francine: what kind of advice did you get when you were starting out? be, keep your alert it's with any job. if you get good at it, then you acquire a certain safe feeling about what you know, about what you think you know, about how things unfold in front of you, and you lose touch. , always be edge, becausee things change quicker, always theyer, even if you think have to change quicker, they change quicker even, so be on the edge over time. never feel comfortable. francine: how mucu put diversity on your board

and your employees? francesco: diversity stimulates this edge feeling. you always have a different mind. when you talk about diversity, you imply gender diversity, n easy diversity measurement, but really i think it is the mindset diversity that matters. that has to do with cultu preparation, what professions people come from, and inclination and character of people. i try to mix always different people. in my team you will find completely different people together, which making life not easy, but it generates thinking and ideas. you ever worry about an activist investor coming in? francesco: no. francine: why not? francesco: why should i worry about i if there's something i should worry about, it's not the activist. it is that thing i should worry

about. ,f they are targeting a it means something in the company doesn't work. francine: francesco starace, thank you for joining us. thank you.utive of enel. ♪

rolls onobal rally amid optimism we can avoid an all-out trade war. have a look at the japanese trade markets. the topix is up. jpmorgan things these off-on tensions have a cost investors more than a trillion dollars. germany saying the g7 will tackle donald trump on tariffs. and, may issues a unanimous statement. i am rishaad salamat in hong kong. >> i am haidi lun in sydney. hesitate to raise

rates again, if required. our exclusive interview was coming up this hour. this is bloomberg markets: asia. >> we ar gains, on wall streetrnight. this off-again on-again trade war roller coaster. investors are thinking with conciliatory statements, not to mention geopolitical risks going into this key singapore summit between north korea and the u.s., not a great deal of concern on the markets it seems. rish across the board we are seeing gains. we will have a look at that as jakarta gets on stream. 1, with thatg6 plus -- it could be g6 plus