* Enel to spend more than 20 bln euros on renewables, grids
* To generate 62 pct of power from green sources by 2021
* Raises EBITDA targets, sets minimum dividend for first time
* Rules out big acquisitions but open to mid-size deals (Recasts, adds CEO comments, broker, shares)
By Stephen Jewkes
MILAN, Nov 20 (Reuters) - Europe's biggest utility, Italy's Enel, pledged on Tuesday to invest more in its green energy and network businesses to boost earnings and meet growing demand for electricity and new digital services.
In its new three-year plan, the world's largest private renewables player raised its spending intentions for the next three years by 12 percent to 27.5 billion euros ($31.5 billion) with some 80 percent earmarked for green operations and grids.
The utility, which controls Spanish energy group Endesa , said it expected 62 percent of its power production to be emission-free by 2021 compared with 48 percent this year. By 2050 it will have no carbon footprint.
"Renewables is increasingly a customers' choice," Enel CEO Francesco Starace told analysts.
To sell electricity, Enel is increasingly turning to purchase agreements with companies such as Google and Facebook that demand power from renewable sources.
As governments introduce more stringent rules to meet climate targets, Europe's power sector is undergoing significant change driven by a boom in renewable energy as costs fall and technology advances.
Italy's populist 5-Star Movement, which took office with coalition partner the League in June, has placed green energy and digital technology at the heart of its industrial policy.
Enel said it aimed to add 11,600 megawatts (MW) of new renewable capacity in the next three years, mostly in the Americas, while withdrawing around 7,000 MW of thermal capacity.
"Enel will reinforce its focus on markets where it has an integrated presence, such as Italy, Spain, Chile and Brazil," it said.
The utility said its core earnings would grow by around 6 percent per year and reach 17.4 billion euros next year, better than the 17.2 billion euros in its previous plan.
It confirmed it would pay 70 percent of its ordinary net profit as dividends, but said it was introducing a minimum dividend per share target over the plan for the first time.
"Enel's targets were significantly better than expected with a focus on growth in renewables and networks, efficiencies ... and shareholder returns," Milan broker Equita said.
At 1353 GMT Enel shares were up 1.9 percent, while Italy's blue-chip index was down 1.3 percent.
Starace said Enel was ready to make acquisitions. "There is balance-sheet headroom and mid-sized acquisitions remain an option," he said.
In June, Enel agreed to spend almost $1.5 billion to buy a majority stake in Brazil's Eletropaulo.
The utility recently looked at acquiring Colombia's distressed power distribution company Electricaribe but remains cautious.
"We would never embark on a standalone basis but would require a Colombian partner," Starace said when asked about Enel's interest. ($1 = 0.8730 euros) (Reporting by Stephen Jewkes; Editing by Francesca Landini, Louise Heavens and Dale Hudson)