Enel Americas
Annual Report 2008

Plain-text annual report

S A N T A R O S A 7 6 , S A N T I A G O , C H I L E I P H O N E S ( 5 6 2 ) 3 5 3 4 4 0 0 , 3 7 8 4 4 0 0 I w w w. e n e r s i s . c l T R O P E R L A U N N A A N N U A L R E P O R T Santiago Stock Exchange New York Stock Exchange Madrid Stock Exchange ENERSIS ENI XENI Enersis S.A. was initially constituted with the name Compañía Metropolitana de Distribución Eléctrica S.A., but changed its name to Enersis S.A. on August 1, 1988. Its capital is ThCh$2,824,882,834 divided into 32,651,166,465 shares. Its shares are quoted in the Chilean stock exchanges, on the New York Stock Exchange in the form of American Depositary Receipts (ADRs), and the Latin American Securities Exchange of the Madrid Stock Exchange (Latibex). Its principal business is the exploitation, development, operation, generation, distribution, transmission, transformation and/or sale of energy in any of its forms or nature, directly or through other companies, plus activities in telecommunications and the provision of engineering advisory services in Chile and abroad, and to invest and manage its investments in subsidiary and affiliate companies. Its total assets amount to ThCh$14,399,627,877 as of December 31, 2008. Enersis controls and manages a group of companies that operate in the electricity markets of 5 countries in Latin America. During 2008, it produced a net income of ThCh$570,883,101 and operating income of ThCh$1,978,797,458. As of the end of 2008, it employed 12,733 people directly through its subsidiary companies in the region. ENERSIS MANAGEMENT CHAIRMAN PABLO YRARRÁZAVAL VALDÉS PHONE (56-2) 353 4663 CHIEF EXECUTIVE OFFICER IGNACIO ANTOÑANZAS ALVEAR PHONE (56-2) 353 4510 COMMUNICATION OFFICER JOSÉ LUIS DOMÍNGUEZ COVARRUBIAS PHONE (56-2) 353 4666 AUDITING OFFICER ANTONIO ZORRILLA ORTEGA PHONE (56-2) 353 4647 HUMAN RESOURCES OFFICER FRANCISCO SILVA BAFALLUY PHONE (56-2) 353 4610 INVESTOR AND SHAREHOLDER RELATIONS REGIONAL ACCOUNTING OFFICER FERNANDO ISAC COMAS PHONE (56-2) 353 4685 CHIEF INVESTMENTS AND RISKS OFFICER RICARDO ALVIAL MUÑOZ PHONE (56-2) 353 4682 REGIONAL CHIEF FINANCIAL OFFICER ALFREDO ERGAS SEGAL PHONE (56-2) 630 9130 CITIBANK NY RICARDO SZLEZINGER PHONE (1-212) 816 6852 SANTANDER CENTRAL HISPANO INVESTMENT ENRIQUE ROMERO PHONE (34-91) 289 3943 REGIONAL PLANNING AND CONTROL OFFICER RAMIRO ALFONSÍN BALZA PHONE (56-2) 353 4684 GENERAL COUNSEL DOMINGO VALDÉS PRIETO PHONE (56-2) 353 4631 [ Contents ] CHAIRMAN’S LETTER HIGHLIGHTS OF 2008 COMPANY IDENTIFICATION OWNERSHIP AND CONTROL SHARE TRANSACTIONS DIVIDEND POLICY 2008 INVESTMENT AND FINANCING POLICY 2008 MANAGEMENT AND PERSONNEL THE COMPANY’S BUSINESSES 2 8 12 16 20 24 26 30 40 50 RISK FACTORS 54 DESCRIPTION OF ELECTRICITY BUSINESS BY COUNTRY 78 OTHER BUSINESSES 86 SUSTAINABILITY 94 IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES 112 DECLARATION OF RESPONSIBILITY 114 CONSOLIDATED FINANCIAL STATEMENTS 224 UNCONSOLIDATED FINANCIAL STATEMENTS 256 FINANCIAL STATEMENTS OF THE SUBSIDIARIES 2 enersis08 ANNUAL REPORT CHAIRMAN’S LETTER ANNUAL REPORT CHAIRMAN’S LETTER 3 In a year characterized by the real risk of suffering electricity rationing in Chile’s central zone, Enersis and its subsidiaries Endesa Chile and Chilectra took the actions necessary for mitigating this risk and working in cooperation with the authority with the objective of seeking and designing suitable solutions for managing this delicate situation. We thus confirmed the position of leadership and commitment that we have in the region, and especially with Chile, ratifying our belief in alternatives that contribute to guaranteeing electricity supplies in the five countries where we operate (Argentina, Brazil, Chile, Colombia and Peru). We have the financial strength and necessary assets for assuming this responsibility and continuing forward as the leading electricity company in Latin America. Dear Shareholder, As Chairman of the Board of Enersis, I have pleasure RESULTS in presenting to you the Annual Report 2008 which summarizes the company ’s ac tions in both the Thanks to the diversified asset portfolio that we manage, Generation and Transmission businesses and in by having a presence in the electricity Generation, electricity Distribution, plus the series of advances we Transmission and Distribution businesses, added to the have achieved in Sustainability. fact that we operate in five countries in Latin America Before commenting on the principal financial and which enables us to stabilize our operating cash flows, management indicators, I wish to thank each one of Enersis produced a net income of 570,883 million you in the name of Enersis for the trust placed in the Chilean pesos in 2008, which represented a growth of business project that I preside. 178% over the previous year. 4 enersis08 ANNUAL REPORT At the operating level, revenues rose by 35%, ending position and allowing 2008 to end with a healthy Despite this tight energy scenario, and thanks to the the year at 6,650,287 million Chilean pesos, increasing liquidity position which may enable us to face new measures taken by the government and the support of our result by 45% to a total of 1,978,797 million Chilean challenges and take advantage of growth opportunities the private-sector companies, including Endesa Chile pesos. that may appear in the future. and Chilectra, the crisis was overcome successfully with This ratified the good progress of our businesses, a no cuts having to be made to the people. situation confirmed by the 48% increase in operating CAPACITY AND CUSTOMERS In the case of our generation subsidiary, this brought income of the Generation and Transmission segment forward the start-up of the San Isidro II combined-cycle and the 43% rise in the Distribution segment, ending By the end of 2008, our installed capacity in the region plant, adding a total of 353 MW; it had already added the year at 1,100,727 million Chilean pesos and 877,117 increased by 1.4% to 13,893 MW. Notable were the 248 MW in April 2007. During June, the Ojos de Agua, million Chilean pesos respectively. Another element start-ups of the San Isidro II combined-cycle and the Ojos de 9 MW mini-hydroelectric plant started operating; this that reflected the good performance for the year was de Agua mini-hydroelectric plants, projects that added capacity helped to meet the supply situation experienced the company’s return on assets, which improved from 114 MW to Chile’s principal electricity grid (SIC). by the central zone. 1.65% as of the end of 2007 to 3.96% as of the end In the Distribution business, we added 443 thousand Starting in March, Endesa Chile made its first offers of 2008. new customers, which equates to adding to our in order to regulated customers could reduce their The non-operating result produced a negative figure operation a new mid-sized distribution company. In consumption. This mechanism was channeled through of 266,128 million Chilean pesos, which however was an fact, our companies supplied electricity to 12.4 million the electricity distributors which transferred the payment improvement of 343,915 million Chilean pesos over the customers, more than 45 million Latin American for savings to the end users, and sought to reduce energy loss of 610,043 million Chilean pesos in 2007. residents. It should be mentioned that the large increase in net income for 2008 was partly explained by accounting SUPPLY effects and the appreciation of the currencies of the demand and decrease the requests of the system. Chilectra, our distribution subsidiary, launched a campaign for promoting the efficient use of energy and thus support and reinforce the savings campaign different countries where we operate with respect to the 2008 was not an easy year, considering the real risk introduced by the government in February 2008. dollar, especially in Colombia and Brazil, a situation that of a programmed rationing on the SIC, system that All these actions were a reflection of a series of will probably not be repeated in the coming years. supplies over 90% of the Chileans. This was due to the measures that the Enersis Group introduced and While the accounting matter impacted positively, the drought during the early months of the year, natural gas carried out to reduce the risks of electricity rationing, operation and management of the company’s businesses restrictions and the blackout suffered by prevailing one in collaboration with the Ministry of Energy and the also did so, managing to maintain our solid financial of the principal thermal plants in the grid. National Energy Commission (CNE). ANNUAL REPORT CHAIRMAN’S LETTER 5 TRUST OF ALL CHILEANS better job and training opportunities, a situation that will translate into better living conditions. This, also In this summary, I would not wish to omit mentioning In mid 2008, HidroAysén, the company in which Endesa thanks to the development of trade and connectivity, the financial crisis that affected and still affects the Chile holds 51% of the share capital, submitted to the will permit a greater integration of Aysén’s people with economies of the world, a situation that nobody foresaw relevant authority its Environmental Assessment Study the rest of the country. at the beginning of 2007 when the so-called sub-prime (EAS) for the Aysén Hydroelectric project. crisis exploded. Enersis, as the controller of Endesa Chile, follows PROJECTS The lack of liquidity and confidence impacted our the development of this project closely and in detail, economy and will continue to do so to a greater or knowing that its completion is of great importance for In the business of Generation and in line with the lesser degree depending on the productive sector in Chile’s energy independence and growth. commitment we assume of providing security of supply which each company operates. The five plants of HidroAysén will substitute fossil in the countries where we operate, we submitted during As Enersis Group, however, we think that the region is better prepared to face the current situation, especially Chile, which has a healthy macroeconomic position, a recognized institutional structure and consolidated capital markets. fuels in generation, replacing at full capacity the emission of 44 thousand tons daily of CO2, some 16 million tons annually. This figure equates to the annual emission of CO2 by the whole Chile vehicle park (excluding buses and trucks). 2008 the Environmental Impact Declaration (EID) for the Canela II wind farm, and work also continued on the Bocamina II, Quintero Thermal Plant and GNL Quintero Terminal projects. Progress was also made in the studies for the Choshuenco, Neltume and Los Cóndores plants, Despite the turbulences that affected the markets, The project is designed to generate the least amount all in Chile. the price of our shares in the local stock exchange rose of environmental impact and, of all the energy production At the same time, we continue with the Santa Rosa by 3% during 2008, ending the year at 165 Chilean pesos per share. forms in Chile and the whole world, hydroelectricity does not emit CO2. (new open cycle) project in Peru, and the El Quimbo hydroelectric project in Colombia. For their part, the shares of Endesa Chile and Chilectra Preventing the hydroelec tric development of In Distribution, the investments are and will be ended the year with prices of 734 Chilean pesos and Chile, with its consequent lower costs and less oriented partly to attending the needs of our growing 1,450 Chilean pesos each respectively, which implied a environmental impact, will necessarily imply the system’s customer base and maintaining the high standards of growth of 16% in the case of our generation subsidiary growth through more expensive and contaminating service quality which, among other parameters, are and of 22% in the case of the distribution subsidiary. alternatives. measured by a reduction in the annual number of power This is an evidence of the trust in our business and At the s ame time, the initiative will mean a cuts, a reduction in the duration of power cuts and the the solid foundations of the Enersis Group, the parent development opportunity for the inhabitants of the provision of more reliable networks. company of Endesa’s businesses in Latin America. Region of Aysén, through the creation of new and 6 enersis08 ANNUAL REPORT However, and considering the present global economic Secondly, and with the firm conviction of contributing - Contribution to the Endesa Spain Community scenario, the company has the necessary tools for to the educational and cultural development of Chile, (ENDESA). making this investment plan more flexible and thus Enersis, El Mercurio newspaper and Universidad de - Best Investor Relations Team in Chile, according to adapting it without affecting our contribution to the Los Andes decided to support and enliven the Chile Capital magazine and Santander Global Banking & security of electricity supplies in Latin America. Bicentenary in Four Moments project. Markets (Enersis). The third event was related to the start-up of the - First place in the category Corporate Governance SUSTAINABILITY Corporate Volunteers Program, an initiative that reflects Practices, Utilities Sector, according to Investor a culture committed to education and in which 15% of Relations Global Rankings (Enersis). W ith resp e c t to the ac tions t aken in ter ms of the company’s personnel have already taken part. - Best Managed Company in Latin America in the Sustainability, which we understand as economic growth, Lastly, and in our wish to contribute to knowledge, Utilities Sector, according to Euromoney magazine social progress and ecological balance, I can state with preservation and care for biodiversity, the Enersis Group (Enersis). pride that during 2008 we carried out a series of tasks and Fundación San Ignacio del Huinay prepared the book - To p 10 i n T h e B e s t G o v e r n e d M a j o r L a t i n within our principal focus of action: education. Native Trees of Chile and the mock-up of the document Corporations 2008 according to the consultancy To summarize these actions, we can mention four Marine Benthonic Fauna of the Chilean Patagonia. Management & Excellence and LatinFinance significant highlights: Firstly, we are continuing to advance with our project RECOGNITIONS called Illuminating Monuments in the South of the magazine (Enersis and Endesa Chile). - Best Group Annual Report, according to Gestión magazine and PricewaterhouseCoopers (Enersis, World. I should also like to share with you the series of Endesa Chile and Chilectra). Since its beginnings in Latin America in 2000 and recognitions that we received during 2008, awards that - Top 10 in the 4th CSR Ranking 2008, according to until the end of 2008, this initiative has permitted the confirm our practices and achievements. Fundación PROhumana, CPC and Capital magazine illumination, restoration and giving life to more than 80 These include: (Endesa Chile). religious and civil works in Chile, Peru and Colombia. - Ten Best Companies for Working Mothers and - Labor Safety Prize (Endesa Chile). We have completed work on a total of 49 monuments Fathers, according to Fundación Chile Unido and - AmCham Prize for Good Corporate Citizenship at the local level and, in 2008, inaugurated the lighting Ya magazine of El Mercurio (Enersis, Endesa Chile (Chilectra). of the churches of Carahue, Villarrica and Molina. and Chilectra). - Cigré Prize for Innovation (Chilectra). ANNUAL REPORT CHAIRMAN’S LETTER3 7 - ACHS Prize for Effective Action in Safety Matters A s the Enersis Group, we have the mission to (Chilectra). contribute to security in electricity supplies, providing - Best Social Management Report, according to Acción the best service in Latin America at a reasonable price RSE (Chilectra). and with respect for the environment. Under this premise, based on a robust financial BETTER SERVICE AND PERSONNEL situation and assets of 22,625 million dollars, we will be alert to new growth opportunities and the fulfillment Everything mentioned in this report, both at the financial of our investment plan in the five countries in which and management levels, would not have been possible we operate, especially in Chile; all this through the without the decided support of ever y one of the development of autochthonous, renewable and clean workers and staff who form part of the companies of resources like water, the resource that is everyone’s and our business group. for all Chileans. As Chairman of Enersis, I would like to congratulate every one for their work during 2008. Thanks to this, Yours sincerely, we have managed to close a good year despite the energy tightness that affected Chile and the series of problems that the global economy has faced and will continue to face. We have reaffirmed our leadership position in Latin America and our solid financial position, a situation that speaks very well of each of our employees and managers as, without their work, we would not be capable of achieving the objectives which we set ourselves as a Pablo Yrarrázaval Valdés company year by year. Chairman 8 enersis08 ANNUAL REPORT HIGHLIGHTS OF 2008 ANNUAL REPORT HIGHLIGHTS OF 2008 9 At the end of January, and as part of the Donation of Libraries program, Enersis donated, together with El Mercurio, 500 books to the Municipal Library of Paredones, located in Chile’s 6th Region. Enersis was distinguished in March as the Best Managed Company in Latin America in the Utilities Sector, according to Euromoney magazine. As part of the Illuminating Monuments in the South of the World project, the lighting was restored to the Sagrado Corazón de Jesús Cathedral in Villarrica in March. Later in the year, the San Pablo de Carahue and Nuestra Señora del Tránsito de Molina parish churches were added. In the 10th edition of Investor Relations Global Rankings (IRGR 2008) in April, Enersis was awarded top place in On March 19, the Enersis Group inaugurated the the category Corporate Governance Practices Utilities combined cycle of the San Isidro II thermal pant, thus Sector. adding 105 MW to the SIC. 10 enersis08 ANNUAL REPORT During May, Enersis was distinguished as the Best In May also, Enersis began the pilot run of the Corporate On September 2, Enersis and its subsidiary Endesa Investor Relations Team in Chile, heading the Top 100 Volunteers Program. ranking in that category, measures by Capital magazine Chile, with the principal local companies, successfully celebrated Chile Day in the New York Stock Exchange and Santander Global Banking & Markets. In June, the company obtained an outstanding place (NYSE). in The Best Governed Major Latin Corporations 2008, being among the Top 10 in this ranking. In mid July, and as part of the Libraries Donation program, Enersis presented, together with El Mercurio, more than 400 books to the Pedro Mariño de Lobera Municipal Library, Coronel, in Chile’s 8th Region. The Enersis Group was distinguished in September as being among the Ten Best Companies for Working Mothers and Fathers. ANNUAL REPORT HIGHLIGHTS OF 2008 11 The Enersis Group, jointly with El Mercurio and Earl y in S eptemb er, Ener sis organize d the 4th During December, Enersis and Fundación San Ignacio del Universidad de los Andes, officially launched the Chilean International Conference for Chilean Issuers, an event Huinay published the book “Native Trees of Chile”. Bicentenary in Four Moments project in the first days that was attended by leading economists, portfolio of September. managers and executives related to bank s and The company Bureau Veritas Chile certified the total The Enersis Group was recognized in September as producing the Best Group Annual Report, according to PricewaterhouseCoopers and Gestión Magazine. investment funds. gross declared capacity of the generating assets of the Enersis Group in Latin America 2008, amounting to the total of 13,893 MW, a 1.4% increase over the year before. Revenues grew by 35% to 6,650,287 million Chilean pesos, explained by an increase of 33% in the Generation and Transmission business and a rise of 35% in Distribution. 12 enersis08 ANNUAL REPORT COMPANY IDENTIFICATION ANNUAL REPORT COMPANY IDENTIFICATION 13 Name Domicile Kind of company Tax I/D No. Address Telephones Fax PO Box Web Site Enersis S.A. Santiago, being able to open agencies or branches in other parts of the country or abroad. Open Corporation 94,271,000 - 3 Santa Rosa Nº 76, Santiago, Chile (56-2) 353 4400 - (56-2) 378 4400 (56-2) 378 4788 1557, Santiago www.enersis.cl Electronic Mail informaciones@e.enersis.cl Inscription Registree N° 175 External Auditors Subscribed & Paid Capital (ThCh$) Chilean Stock Exhanges ticker N° New York Stock Exchange ticker N° Madrid Stock Exchange ticker N° ADR Program Custodian Bank ADR Program Depositary Bank Latibex Custodian Bank Latibex Link Entity Deloitte & Touche 2,824,882,834 ENERSIS ENI XENI Banco de Chile Citibank N.A. Banco Santander Santander Central Hispano Investment S.A. Chilean Credit Rating Agencies Feller Rate and Fitch International Credit Rating Agencies Fitch, Moody’s and Standard & Poor’s 14 enersis08 ANNUAL REPORT 01. CONSTITUTION bylaws approved by Resolution 409-S of July 17, 1981 On August 1, 1988, the company’s name was changed of the Securities and Insurance Commission (SVS). The to Enersis S.A. The latest amendment is that set out The company that gave rise to Enersis S.A. was formed, extract of the authorization for the incorporation and in public deed dated April 13, 2006, certified by the initially with the name Compañía Chilena Metropolitana approval of the bylaws was registered in the Santiago Santiago notary Patricio Zaldívar Mackenna, whose de Distribucion Electrica S.A. by public deed dated Trade Registry on page 13,099 Nº 7,269 for year 1981, extract was registered in the Santiago Trade Register June 19, 1981 granted by the notary Patricio Zaldívar and were published in the Official Gazette of July 23, for 2006, page 15,343, Nº 10,611 and published in the Mackenna in Santiago, and was modified by public deed 1981. The bylaws of Enersis have since undergone a Official Gazette on April 22, 2006. dated July 13 the same year before the same notary. number of amendments. The company’s incorporation was authorized and its ANNUAL REPORT COMPANY IDENTIFICATION 15 02. CORPORATE OBJECTS Company’s objects are to explore, develop, operate, generate, distribute, transmit, transform and /or sell energy in any of its forms or types, in Chile or abroad, directly or through other companies, and telecommunications activities and the provision of engineering consultancy in Chile and abroad. It may also invest and manage its subsidiaries and affiliate companies, be these generator s, transmit ter s, distributors or traders of electricity or whose business is any of the following: (i) energy, in any of its forms or nature, (ii) the supply of public utilities or whose main raw material is energy, (iii) telecommunications and IT, and (iv) trading over the internet. In complying with its main objects, the company will carry out the following functions: a) promote, organize, create, modify, dissolve or liquidate companies of any services; financial, technical, legal and auditing advice; trading and disposal of all kinds of movable and nature which have similar corporate objects to its own; and in general any type of service necessary for their immovable assets, either directly or through subsidiary b) propose investment, financing and business policies best performance. or affiliate companies; ii) all kinds of financial assets, to subsidiary companies, as well as accounting criteria In addition to its main objects and acting within including shares, bonds and debentures, commercial and systems that these should follow; c) supervise the limits established by the Investment and Financing papers and in general all kinds of titles or securities subsidiary company management: d) provide subsidiary Policy approved by the general shareholders meeting, and company contributions, either directly or through or associate companies with the necessary financing for the Company may invest in: i) the acquisition, operation, subsidiary or affiliate companies. their business development and provide management construction, rental, administration, intermediation, 16 enersis08 ANNUAL REPORT OWNERSHIP AND CONTROL ANNUAL REPORT OWNERSHIP AND CONTROL 17 01. OWNERSHIP STRUCTURE The company capital is divided into 32,651,166,465 shares of no par value, in the same sole series. As of December 31, 2008, all the shares were subscribed and paid, distributed in the following manner: Shareholder Endesa Latinoamérica S.A. Pension Fund Managers ADR’s (Citibank N.A. Depositary Bank, Rule N°1,375 SVS) Stockbrokers, Insurance Companies & Mutual Funds Banco de Chile (on behalf of third parties) Foreign Investment Funds Others Total Acciones Number of Shares Shareholding 19,794,583,473 5,584,380,494 3,563,352,750 1,784,596,797 873,795,010 96,656,413 953,801,528 60.62% 17.10% 10.91% 5.47% 2.68% 0.30% 2.92% 32,651,166,465  100.00% 18 enersis08 ANNUAL REPORT 02. IDENTIFICATION OF THE CONTROLLERS 03. LIST OF MAJOR SHAREHOLDERS As of December 31, 2008, Enersis was owned by 8,241 shareholders. The major were: According to Chapter XV of Law 18,045, the direct controller of the company is Endesa Latinoamérica, S.A., Name Endesa Latinoamérica S.A. a Spanish corporation that holds 60.62% of Enersis. Citibank N.A. (Depositary Bank, Rule N°1,375 SVS) Endesa Latinoamérica, S.A., in turn is controlled 100% by ENDESA, S.A., a corporation located in the Spain Kingdom and whose main shareholders as of December 31, 2008, and according to the CNMV (Spanish National Securities Market Commission) are: ENEL ENERGY EUROPE S.r.L. with a 67.053% shareholding (ENEL AFP Provida S.A. AFP Habitat S.A. AFP Capital S.A. AFP Cuprum S.A. Banco de Chile (on behalf of this parties) Banchile Corredores de Bolsa S.A. LarrainVial S.A. Corredora de Bolsa AFP Planvital S.A. Celfin Capital S.A. Corredores de Bolsa ENERGY EUROPE S.r.L in turn is controlled 100% by Banco Itaú (on behalf of investors) Tax No. 59,072,610-9 97,008,000-7 98,000,400-7 98,000,100-8 98,000,000-1 98,001,000-7 97,004,000-5 96,571,220-8 80,537,000-9 98,001,200-K 84,177,300-4 76,645,030-K Sub total: 12 shareholders Others: 8,229 shareholders Total: 8,241 shareholders ENEL S.p.A); ACCIONA, S.A. with a 5,01% shareholding and FINANZAS DOS, S.A. with 20.0% (FINANZAS DOS, S.A. in turn is controlled 100% by ACCIONA, S.A.). The ENDESA, S.A. free float as of December 31, 2008 was 7,937%. On March 26, 2007, ACCIONA, S.A., and ENEL ENERGY EUROPE S.r.L., entered into a shared- management agreement with respect to ENDESA, S.A. The text of this agreement was reported to the CNMV as material information on the same date of its signing and can be consulted on that authority’s web site (www.cnmv.es). Number of Shares Shareholding 19,794,583,473 3,563,352,750 1,744,595,549 1,341,201,242 1,250,054,362 1,069,960,516 873,795,010 447,694,539 187,819,735 178,568,825 136,592,147 127,334,804 30,715,552,952 1,935,613,513 32,651,166,465 60.62% 10.91% 5.34% 4.11% 3.83% 3.28% 2.68% 1.37% 0.58% 0.55% 0.42% 0.39% 94.08% 5.92% 100.00% ANNUAL REPORT OWNERSHIP AND CONTROL 19 04. MAJOR OWNERSHIP CHANGES The changes of greatest importance in the ownership of Enersis in 2008 were: Name Citibank N.A. (Depositary Bank, Rule N°1,375 SVS) AFP Provida S.A. AFP Habitat S.A. AFP Capital S.A. (*) AFP Cuprum S.A. Banco de Chile (on behalf of this parties) Banchile Corredores de Bolsa S.A. Banco Itaú (on behalf of investors) Santander S.A. Corredores de Bolsa Bolsa Electrónica de Chile Shares as of 31/12/2007 2,890,139,300 1,790,291,654 1,513,040,675 1,284,346,556 949,141,449 471,646,933 522,653,676 0 168,196,303 147,525,675 Note: (*) AFP Capital S.A. is the result of the merger of AFP Santa María & AFP Bansander. Shares as of 31/12/2008 3,563,352,750 1,744,595,549 1,341,201,242 1,250,054,362 1,069,960,516 873,795,010 447,694,539 127,334,804 126,410,661 71,994,378 Change in No.  of Shares 673,213,450 -45,696,105 -171,839,433 -34,292,194 120,819,067 402,148,077 -74,959,137 127,334,804 -41,785,642 -75,531,297 05. SUMMARY OF SHAREHOLDERS’ COMMENTS AND PROPOSALS Enersis received no comments with respect to the progress of the business during 2008 by the majority shareholders or groups of shareholders representing 10% or more of the issued shares with voting rights, in accordance with the provisions of article 74 of Law 18,046 and articles 82 and 83 of the regulations to the Corporations Law. 20 enersis08 ANNUAL REPORT SHARE TRANSACTIONS ANNUAL REPORT SHARE TRANSACTIONS 21 01. STOCK EXCHANGE TRANSACTIONS The quarterly transactions of the last 3 years on the stock exchanges where Enersis shares are traded, both in Chile, through the Santiago Stock Exchange (Bolsa de Comercio de Santiago), and the Chile Electronic Stock Exchange (Bolsa Electronica de Chile), and the Valparaiso Stock Exchange (Bolsa de Valores de Valparaíso ), and in the United States of America and Spain through the New York Stock Exchange (NYSE) and the Latin American Securities Exchange on the Madrid Stock Exchange (Latibex) (Bolsa de Valores Latinoamericanos de la Bolsa de Madrid (Latibex) respectively, are detailed below: SANTIAGO STOCK EXCHANGE During 2008, 9,609 million shares were traded at the Santiago Stock Exchange, which is equivalent to 1,568,149 million Chilean pesos. As of December, the closing share price was 164.73 Chilean pesos. CHILE ELECTRONIC STOCK EXCHANGE 1,309 million shares were traded at the Chile Electronic Stock Exchange during the year, the equivalent of 209,642 million Chilean pesos. The share price closed at 166.50 at December 2008. Period 1st Quarter 2006 2ndt Quarter 2006 3rd Quarter 2006 4th Quarter 2006 Total 2006 1st Quarter 2007 2ndt Quarter 2007 3rd Quarter 2007 4th Quarter 2007 Total 2007 1st Quarter 2008 2ndt Quarter 2008 3rd Quarter 2008 4th Quarter 2008 Total 2008 Period 1st Quarter 2006 2ndt Quarter 2006 3rd Quarter 2006 4th Quarter 2006 Total 2006 1st Quarter 2007 2ndt Quarter 2007 3rd Quarter 2007 4th Quarter 2007 Total 2007 1st Quarter 2008 2ndt Quarter 2008 3rd Quarter 2008 4th Quarter 2008 Total 2008 No. of Shares 1,963,504,194 1,391,561,107 1,424,604,249 2,935,194,633 7,714,864,183 2,326,545,937 2,281,519,210 2,623,759,573 3,104,262,960 10,336,087,680 2,629,967,374 2,353,763,372 1,810,012,396 2,815,324,441 9,609,067,583 No. of Shares 363,061,858 280,361,371 278,723,806 551,462,369 1,473,609,404 482,727,433 327,721,596 433,727,621 504,779,498 1,748,956,148 528,349,339 281,269,910 222,175,773 277,018,070 1,308,813,092 Amount (Pesos) Average Price 241,782,332,100 170,737,146,206 185,750,114,705 471,034,884,328 1,069,304,477,339 403,238,785,712 448,872,471,686 482,941,651,473 546,181,448,622 1,881,234,357,493 369,032,945,308 407,183,479,315 312,772,735,787 479,160,238,375 1,568,149,398,785 Amount (Pesos) 44,427,922,583 34,161,027,229 36,216,066,265 88,445,858,217 203,250,874,294 83,082,386,777 64,327,071,276 79,890,053,929 87,569,943,661 314,869,455,643 76,278,908,151 48,515,676,390 38,114,037,557 46,733,014,629 209,641,636,727 123.14 122.69 130.39 160.48 173.32 196.74 184.06 175.95 140.32 172.99 172.80 170.20 Average Price 122.37 121.85 129.94 160.38 172.11 196.29 184.19 173.48 144.37 172.49 171.55 168.70 22 enersis08 ANNUAL REPORT VALPARAISO STOCK EXCHANGE 50 million shares were traded on the Valparaiso Stock Exchange, amounting to 8,335 million Chilean pesos. The share price closed at 163.84 at December 2008. NEW YORK STOCK EXCHANGE (NYSE) The Enersis stock started trading on the New York Stock Exchange (NYSE) on October 20, 1993. An Enersis ADS consists of 50 shares and its mnemonic name is ENI. Citibank N.A. acts as the depositary bank and Banco de Chile as the custodian in Chile. During 2008, 109 million ADS were traded in the United States of America amounting to 1,691 million dollars. The December ADS closing price was 12.74 dollars. Period 1st Quarter 2006 2ndt Quarter 2006 3rd Quarter 2006 4th Quarter 2006 Total 2006 1st Quarter 2007 2ndt Quarter 2007 3rd Quarter 2007 4th Quarter 2007 Total 2007 1st Quarter 2008 2ndt Quarter 2008 3rd Quarter 2008 4th Quarter 2008 Total 2008 Period 1st Quarter 2006 2ndt Quarter 2006 3rd Quarter 2006 4th Quarter 2006 Total 2006 1st Quarter 2007 2ndt Quarter 2007 3rd Quarter 2007 4th Quarter 2007 Total 2007 1st Quarter 2008 2ndt Quarter 2008 3rd Quarter 2008 4th Quarter 2008 Total 2008 No. of Shares Amount (Pesos) Average Price 11,090,794 7,727,889 8,279,320 16,427,067 43,525,070 8,364,095 9,737,577 7,417,521 16,507,087 42,026,280 12,601,763 20,095,015 4,196,431 13,461,949 50,355,158 1,365,417,295 938,354,614 1,049,392,923 2,582,363,519 5,935,528,351 1,446,466,587 1,914,700,194 1,362,390,508 2,947,390,529 7,670,947,818 1,826,943,424 3,470,065,340 727,400,548 2,310,726,034 8,335,135,346 123.11 121.42 126.75 157.20 172.94 196.63 183.67 178.55 144.98 172.68 173.34 171.65 No. of Shares Amount (Dollars) Average Price 24,652,200 20,778,900 13,510,900 20,414,300 79,356,300 19,608,400 19,283,100 22,964,900 21,992,500 83,848,900 30,348,500 18,772,700 25,112,963 34,750,666 108,984,829 290,941,664 241,808,215 161,595,768 299,067,454 992,963,101 314,610,895 358,148,873 411,880,074 393,529,397 1,478,169,239 459,142,457 344,723,090 418,886,734 467,921,193 1,690,673,474 11.78 11.64 11.96 14.65 16.04 18.57 17.94 17.89 15.13 18.36 16.68 13.47 ANNUAL REPORT SHARE TRANSACTIONS 23 LATIN AMERICAN SECURITIES MARKET ON THE Period No. of Shares Amount (Euros) Average Price MADRID STOCK EXCHANGE (LATIBEX) The Enersis shares started trading on the Latin American Securities Exchange of the Madrid Stock Exchange (Latibex) on December 17, 2001. The company’s dealing unit is 50 shares and its mnemonic name is XENI. Santander Central Hispano Investment S.A. acts as the linking agent and Banco Santander is the custodian in Chile. During 2008, 1.5 million shares were traded, the equivalent of 16 million euros. The closing share price as of December was 9.11 euros. 1st Quarter 2006 2ndt Quarter 2006 3rd Quarter 2006 4th Quarter 2006 Total 2006 1st Quarter 2007 2ndt Quarter 2007 3rd Quarter 2007 4th Quarter 2007 Total 2007 1st Quarter 2008 2ndt Quarter 2008 3rd Quarter 2008 4th Quarter 2008 Total 2008 472,690 479,532 433,281 475,391 1,860,894 468,101 426,654 206,383 250,092 1,351,230 574,208 317,115 349,868 243,642 1,484,833 4,652,963 4,411,956 4,059,131 5,367,646 18,491,696 5,720,875 5,826,061 2,701,883 3,023,238 17,272,057 6,082,911 3,703,245 3,917,120 2,472,402 16,175,678 9.84 9.20 9.37 11.29 12.22 13.66 13.09 12.09 10.59 11.68 11.20 10.15 02. STOCK TRANSACTIONS BY DIRECTORS AND SENIOR EXECUTIVES Shareholder Tax No. Purchase/ Date of Number Trans-action Total Amount Object of the Sale Transaction in of Shares Unit Pice of Transaction Transaction Share-holders Traded (Pesos) (Pesos) Relationship to Company Jorge Omar Ale Yarad Ricardo Alvial Muñoz 8,360,211-2 7,330,389-3 Sale Sale Marcos Cruz Sanhueza 10,702,983-4 Purchase Register 05/20/2008 08/11/2008 10/09/2008 21,208 10,000 86,000 164.00 187.00 150.00 3,478,112 1,870,000 Financial Investment General Manager Waters East Santiago Financial Investment Risks and Investments Director 12,900,000 Financial Investment Taxation Manager 24 enersis08 ANNUAL REPORT DIVIDEND POLICY 2008 ANNUAL REPORT DIVIDEND POLICY 2008 25 01. DISTRIBUTABLE EARNINGS 02. DIVIDEND POLICY 2008 The distributable earnings for 2008 are as follows: The board explained to the general shareholders meeting The total dividend will be defined by the ordinary of Enersis held on April 1, 2008, the dividend policy that shareholders meeting to be held during the first four Millions of Ch$ the board expected to follow during 2008: to distribute months of 2009. Net income for year Amortization negative goodwill (less) Distributable earnings 570,883 6,219 564,664 as a total dividend an amount equivalent to 70% of the Compliance with the above program will be subject, net income for 2008. in terms of dividends, to the net income actually The board distributed an interim dividend, with charge produced and also the results of the projections made to the net income for 2008, representing 15% of the by the company periodically or the existence of certain net income as of September 30, 2008, according to the conditions, as the case may be. financial statements as of that date, which was paid in The dividend policy that the board expects to follow December 2008. during 2009 will be approved by the board at the appropriate time and duly informed to shareholders at the ordinary shareholders meeting planned for April 15, 2009. No. Dividend Type of Dividend Closing Date Payment Date Pesos per Share Charged to the Year 72 73 74 75 76 77 78 Final Final Interim Final Interim Final Interim 04/14/05 03/28/06 12/19/06 05/16/07 12/20/07 04/24/08 12/13/08 04/20/05 04/03/06 12/26/06 05/23/07 12/27/07 04/30/08 12/19/08 0.416540 1.000000 1.110000 4.890330 0.531190 3.412560 1.539310 2004 2005 2006 2006 2007 2007 2008 26 enersis08 ANNUAL REPORT INVESTMENT AND FINANCING POLICY 2008 ANNUAL REPORT INVESTMENT AND FINANCING POLICY 2008 27 The ordinary shareholders meeting held on April 1, B) MA XIMUM INVESTMENT LIMITS 2008 approved the Investment and Financial Policy indicated below: The investment limits for each area are the following: 01. INVESTMENTS • Investments in its subsidiaries in the electricity sector, the amounts needed for the subsidiaries to meet their A) AREAS OF INVESTMENT respective corporate objects. • Investments in other subsidiaries such that sum of Enersis will invest, as authorized by its bylaws, in the the proportions of the fixed assets corresponding following areas: to each of these other subsidiaries does not exceed • Contributions for investment in or for the creation the proportion of fixed assets corresponding to the of subsidiary or affiliate companies whose activity shareholdings in the subsidiaries in the electricity is aligned, related or linked to any forms or types of sector and of Enersis. energy or the supply of public utilities or whose main raw material is energy. • Investment s consistent with the acquisition, exploitation, construction, rental, administration, trading and disposal of any class of immovable assets, whether directly or through subsidiary companies. • Other investments in all kinds of financial assets, titles or securities. 28 enersis08 ANNUAL REPORT C) PARTICIPATION IN THE CONTROL OF THE AREAS OF INVESTMENT In order to control the investment areas and in accordance with Enersis’s corporate objects, the following procedure will be pursued wherever is possible: At the general shareholders meetings of the subsidiary and affiliate companies, the appointment of directors consistent with the Enersis shareholding in that company shall be proposed, these preferably being from among directors or executives of the company or its subsidiaries. • Investment, financial and commercial policies will be proposed to the subsidiary companies, as well as the accounting criteria and systems they should follow. • The management of the company subsidiaries and affiliates will be supervised. • Permanent control of debt limits will be maintained, to the point that the investments or contributions implemented or that are planned for implementation do not represent an unusual variation from the parameters defined by the maximum investment limits. ANNUAL REPORT INVESTMENT AND FINANCING POLICY 2008 29 02. FINANCING A) MA XIMUM LEVEL OF DEBT C) MANAGEMENT POWERS TO AGREE THE GRANTING OF COLLATERAL WITH CREDITORS The maximum level of debt of Enersis is a debt to equity the granting of tangible collateral or guarantees in plus minority interest ratio of 1.75 times, based on the accordance with the law and the corporate bylaws. The company’s management may agree with creditors consolidated balance sheet. D) ASSETS ESSENTIAL TO THE FUNCTIONING B) MANAGEMENT POWERS TO AGREE DIVIDEND OF THE COMPANY RESTRICTIONS WITH CREDITORS Dividend restrictions may only be agreed with creditors if subsidiary Chilectra S.A. are considered essential assets previously approved by a shareholders meeting (ordinary for the functioning of Enersis. The shares representing Enersis’s shareholding in its or extraordinary). 30 enersis08 ANNUAL REPORT MANAGEMENT AND PERSONNEL 01. BOARD OF DIRECTORS ANNUAL REPORT MANAGEMENT AND PERSONNEL 31 CHAIRMAN VICE CHAIRMAN DIRECTOR DIRECTOR DIRECTOR DIRECTOR DIRECTOR Pablo Yrarrázaval Valdés Chairman of the Santiago Stock Exchange Tax ID No.: 5,710,967-K Rafael Miranda Robredo Industrial Engineer Instituto Católico de Artes e Industrias, Madrid Tax ID No.: 48,070,966-7 Pedro Larrea Paguaga Mining Engineer Universidad Politécnica de Madrid Tax ID No.: 48,077,275-K Hernán Somerville Senn Lawyer Universidad de Chile Tax ID No.: 4,132,185-7 Eugenio Tironi Barrios Sociologist School of Senior Studies in in Social Sciences, Paris, France Tax ID No.: 5,715,860-3 Patricio Claro Grez Civil Industrial Engineer Universidad de Chile Tax ID No.: 5,206,994-7 Juan Eduardo Errázuriz Ossa Civil Engineer Pontificia Universidad Católica de Chile Tax ID No.: 4,108,103-1 SECRETARIO DEL DIRECTORIO Domingo Valdés Prieto Lawyer Universidad de Chile Tax ID No.: 6,973,465-0 Enersis is managed by a 7-member board of directors DIRECTORS’ REMUNERATION each of whom remains in office for a period of 3 years and may be reelected. The current board of directors was Pursuant to article 33 of the Corporations Law 18,046, elected at the ordinary shareholders meeting held on April the ordinary shareholders meeting held on April 1, 2008 1, 2008. The chairman, vice-chairman and the secretary approved the remuneration to be paid to the members of to the board were appointed at a board meeting held on the board for 2008. the same day. 32 enersis08 ANNUAL REPORT The amounts paid to the directors as of December 31, 2008 as members of the board as such, and as members of the Directors’ Committee and Audit Committee, and those company directors who are acting or have acted during 2008 as directors of subsidiaries, are detailed below: As of December 31, 2008 Chilean Pesos Name Position Period of  Performance Pablo Yrarrázaval Valdés Rafael Miranda Robredo Pedro Larrea Paguaga Hernán Somerville Senn Eugenio Tironi Barrios Patricio Claro Grez Juan Eduardo Errázuriz Ossa Juan Ignacio de la Mata Gorostizaga Chairman 01/01/08 al 12/31/08 Vice Chairman 01/01/08 al 12/31/08 Director Director Director Director Director Director 01/01/08 al 12/31/08 01/01/08 al 12/31/08 01/01/08 al 12/31/08 01/01/08 al 12/31/08 04/01/08 al 12/31/08 01/01/08 al 03/31/08 TOTAL Note: (*) Amountss Board of   Enersis (*) 53,444,563 40,334,747 25,951,460 26,722,281 26,722,281 26,722,281 19,539,745 6,457,681 225,895,039 Board of  subsidiaries Directors’  Audit  Committee (*) Committee (*) Profit  Sharing - - - - - - - - - 8,939,058 - - 8,939,058 - 8,939,058 - - - - - 5,862,573 - 5,862,573 2,982,012 2,155,705 26,817,174 16,862,863 - - - - - - - - - ADVISORY EXPENSES OF THE BOARD 02. DIRECTORS’ COMMITTEE ACTIVITIES OF THE DIRECTORS’ COMMITTEE The board incurred no expenses in advisory services In accordance with article 50 bis of the Corporations Law The Directors’ Committee met 12 times during the during 2008. 18,046, Enersis has a 3-member Directors’ Committee year 2008. It examined and approved the information whose powers and duties are set out in that article. On relating to the operations referred to in article 89 of the April 1, 2008, the company’s board appointed Pablo Corporations Law 18,046, doing reports over the above Yrarrázaval Valdés (related to the controller), Hernán mentioned transactions. In addition, specific issues were Somerville Senn (related to the controller) and Patricio dealt with at these meetings, as detailed below: Claro Grez (independent of the controller) as members At its first meeting of the year, on January 30, of the Directors’ Committee. In turn, the Enersis 2008, the Directors’ Committee agreed to propose to Directors’ Committee, at its meeting hold on April 25, the general shareholders meeting that the firms Feller 2008 appointed Pablo Yrarrázaval Valdés as its chairman Rate Clasificadora de Riesgo Limitada and Fitch Chile and Domingo Valdés Prieto as its secretary. Clasificadora de Riesgo Limitada be appointed as the ANNUAL REPORT MANAGEMENT AND PERSONNEL 33 company’s national private credit-rating agencies and and between Enersis S.A. and Corpbanca, in accordance stating that this met conditions of equity similar to those the firms Fitch Ratings, Moody’s Investors Service and with Resolution 13/2007 adopted by the meeting of the habitually prevailing in the market and made its report Standard & Poor’s International Ratings Services as its Directors’ Committee on May 29, 2007, declaring that in accordance with article 50 bis No.3 of Law 18,046. It international credit-rating agencies for 2008. It approved these operations meet the conditions of equity similar also examined the operation consisting of renewing the a budget proposal of the Directors’ Committee for 2008 to those habitually prevailing in the market and made Group’s material damages and civil liability insurance and decided to submit this proposal to the board and its report in accordance with article 50 bis No.3 of Law program within the “Cautiva” scheme for the period to the general shareholders meeting of Enersis S.A. It 18,046. 2008-2009, since the offers received met conditions approved the text of the report that should be presented In its third meeting on March 28, 2008, the of equity similar to those habitually prevailing in the to the general shareholders meeting about the activities Directors’ Committee agreed to propose to the board, in market, issuing their respective report. of the Committee during 2007, and on the expenses order for it in turn to propose to the general shareholders At it s six th meeting on June 25, 2008, the that it has incurred, including those of advisers during meeting, the appointment of the independent external Committee examined the transactions of Enersis S.A. that year. auditing firm Deloitte & Touche for the year 2008. with related parties during May 2008. In its second meeting on February 27, 2008, It also examined the remunerations system and At it s seventh meeting on July 31, 2008, the the Directors’ Committee examined the company’s compensation plans for the company’s managers and Directors’ Committee examined the unconsolidated and unconsolidated and consolidated financial statements senior executives. consolidated financial statements of the company as of for 2007, their notes, statement of income and material At its fourth meeting on April 25, 2008, which June 30, 2008, their notes, statements of income and information, plus the report of the external auditors took place following the general shareholders meeting material information. and the inspectors of accounts. It was informed of of April 1, 2008 which renewed the board of Enersis At its eighth meeting held on August 29, 2008, the report prepared by the external auditors on the S.A., the Committee agreed to appoint as its chairman the Directors’ Committee examined the contracting of banking and money-broking businesses, as established Pablo Yrarrázaval Valdés and Domingo Valdés Prieto as services for the development and implementation of in Joint Circular 960 of the Superintendency of Banks its secretary. It also examined the unconsolidated and a Taxation Consultation Portal, to be signed between and Financial Institutions and the SVS, and the internal consolidated financial statements of the company as of the company and its subsidiary Synapsis Soluciones control letter of Enersis S.A. dated February 19, 2008, March 31, 2008, their notes, statements of income and y Servicios IT Limitada (Synapsis), finding that it met prepared by the external auditors Deloitte & Touche material information. conditions of equity similar to those habitually prevailing in accordance with SVS Circular 422. The Committee At its fifth meeting held on May 28, 2008, the in the market, and issuing its report. It also examined the also examined certain financial operations executed Directors’ Committee examined the operation of services contract for support in technical and scientific between the subsidiary Endesa Chile and Corpbanca, contracting CIEPLAN for arranging three seminars a year, aspects of the book “Native Trees of Chile”, to be signed 34 enersis08 ANNUAL REPORT between the company and its subsidiary Empresa de approx.) to Constructora Logro S.A., a subsidiary of 03. AUDIT COMMITTEE Ingeniería Ingendesa S.A. (Ingendesa), finding that Sigdo Koppers S.A., a company in which Juan Eduardo it met conditions of equity similar to those habitually Errázuriz Ossa is a shareholder, who is also a director The formation of the Audit Committee was approved prevailing in the market and issuing its report. of it and of Enersis S.A., the parent company of Endesa by the Enersis board at its meeting held on June 29, In the ninth meeting of September 24, 2008, the Chile. The Directors’ Committee declared that the award 2005. The Audit Committee is separate from the Committee examined the transactions of Enersis S.A. met conditions of equity similar to those habitually board and the Directors’ Committee, as required by with related parties during August 2008. prevailing in the market and issued its report. The Corporations Law 18,046. The Audit Committee is a At its tenth meeting on October 29, 2008, the Committee also approved the timetable for its ordinary requirement of the United States of America Sarbanes Directors’ Committee examined the unconsolidated meetings for 2009. Oxley Act and the complementary regulations issued and consolidated financial statements of the company In the twelfth meeting of December 19, 2008, the by the Securities and Exchange Commission (SEC) and as of September 30, 2008, their notes, statements of Committee examined the transactions of Enersis S.A. the New York Stock Exchange (NYSE), as Enersis is an income and material information. The Committee was with related parties during November 2008. issuer of American Depositary Receipts (ADRs) which are also informed of certain financial transactions signed In conclusion, the Directors’ Committee of Enersis registered with the NYSE, and is also an issuer of bonds between Chilectra S.A. and Corpbanca, in accordance has complied with the matters set out in article 5º bis registered in the United States of America. Its duties with Resolution 13/2007 adopted by the meeting of the of the Corporations Law 18,046 and has analyzed and include the following: i) to be one of the proposers to Directors’ Committee on May 29, 2007, which met the contributed to the better development of the operations the ordinary shareholders meeting of the appointment of conditions of equity similar to those habitually prevailing analyzed. in the market. the external auditors; ii) to be responsible for controlling the performance of the Company’s external auditors; At its eleventh meeting on November 28, 2008, DIRECTORS’ COMMITTEE EXPENSES DURING iii) initially approving the external audit services and the Directors’ Committee noted that is was informed 2008 of the internal controls letter of Enersis S.A., dated the various services provided by the external auditors; and iv) to establish procedures for the reception and November 15, 2008, prepared by the company’s During the year 2008, the Directors’ Committee did not management of claims in the accounting, internal control external auditors Deloitte & Touche, referring to SVS make use of the operating expense budget approved by or auditing areas. The Enersis extraordinary shareholders Circular 980. The Committee also examined the terms the company’s ordinary shareholders meeting held on meeting held on March 21, 2006 reformed its bylaws of the bid adjudication made by Endesa Chile for the April 1, 2008. The Committee has not had to hire the to regulate the creation, integration, performance and contract CAN-009.08 “Civil Works Canela II Wind services of professional consultants for the performance powers of the Audit Committee. Farm”, for an amount of UF 351,060 (US$11,600,000 of their duties. ANNUAL REPORT MANAGEMENT AND PERSONNEL 35 ACTIVITIES OF THE AUDIT COMMITTEE 2007, plus the use of the expenses for that period of Enersis S.A. as of December 31, 2007, its notes, approved by the general shareholders meeting of April statements of income and material information, plus On April 1, 2008, the board of directors appointed 24, 2007. In accordance with the procedures relating the report on these issued by the company’s external Hernán Somer ville Senn, Patricio Claro Grez and to the Ethics Channel and the Handling of Accusations auditors. The Committee also noted that it had been Juan Eduardo Errázuriz Ossa as members of the Audit approved according to the provisions of the Sarbanes formally and expressly informed of the internal controls Committee, all of whom meet and declared meeting Oxley Act, the Committee issued its opinion on each of letter dated November 15, 2007 and that of February the level of independence expected of members of the accusations presented, provide guidelines to follow 19, 2008, both related to Enersis S.A. and signed by the Audit Committee by the Sarbanes Oxley Act of the in each of these and confirmed that the chairman of the the company’s external auditors, Deloitte & Touche, United States of America, the Securities and Exchange Audit Committee should determine the convenience of as referred to in SVS Circular 980, complemented by Commission and the New York Stock Exchange, as calling an extraordinary meeting of the Committee in its Circular 422 dated December 6, 2007. It was also their respective provisions are applicable to Enersis. the event that the entity making the accusation justifies formally and expressly informed of the report prepared by The Enersis Audit Committee, at its meeting of April 25, it in the opinion of the chairman. In addition, and as the external auditors on the banking and money-broking 2008, unanimously agreed to appoint Hernan Somerville stated in Section 202 of the Sarbanes Oxley Act, the businesses during 2007. In accordance with the Audit Senn as its chairman and Domingo Valdés Prieto as its Audit Committee agreed to pre-approve the contracting Committee’s internal regulations and the Statement on Secretary. The Audit Committee met on eight occasions of external audit services and those unrelated to the Accounting Standards N° 61, the Committee revised and during 2008, and the following specific subjects were external audit to be provided by the external auditors discussed with the external auditor, Deloitte & Touche, discussed: and which were presented to that meeting for their the scope of its professional services, the coverage of the In its ordinary meeting N°1/2008 held on January prior approval. This Committee meeting also approved audit, its independence, the opinions of the management 29, 2008, the Audit Committee approved the fees paid the proposal of the Audit Committee’s budget for 2008 and accounting estimates, critical accounting policies by the Enersis Group companies during 2007 to the and agreed to submit the budget proposal to the board and sensitive areas, significant transactions analyzed, different external audit firms used, these being Deloitte and the ordinary shareholders meeting of Enersis S.A. changes in significant accounting policies, proposed & Touche, Ernst and Young and KPMG, and authorized in order for it to finally resolve on this matter. The au dit adjus t ment s c ar r ie d o u t o r not , w r it ten the estimate of proposed fees for the year 2008. The Committee also agreed to approve the timetable for its communications such as letters of representation and Committee also approved the text of the report that had ordinary meetings for 2008. reports to the management, consultations and principal to be presented to the general shareholders meeting In its extraordinary meeting N°2/2008, held on subjects discussed during the year, disagreements and incorporated in the annual report of Enersis S.A February 27, 2008, the Audit Committee examined the with the management, considerations of fraud, state about the activities carried out by the Committee during unconsolidated and consolidated financial statements of progress of the SOX 404 audit and convergence of 36 enersis08 ANNUAL REPORT Chilean accounting principles to IFRS. It also examined the convenience of calling an extraordinary meeting of adjustments made for the first time to the company’s favorably the supervision and evaluation of the work of the Committee in the event that the entity making the financial statements, complementing the presentation the company’s external auditors made during 2007. accusation justifies it in the opinion of the chairman. In made at the previous meeting. At its extraordinary meeting N°3/2008 held on addition, and as stated in Section 202 of the Sarbanes At its ordinary meeting N°7/2008 held on July 31, March 28, 2008, the Audit Committee agreed to propose Oxley Act, the Committee agreed to pre-approve the 2008, the Audit Committee examined the unconsolidated to the ordinary shareholders meeting the appointment contracting of certain auditing services and those and consolidated financial statements of Enersis S.A. of the firm of independent external auditors, Deloitte & unrelated to the audit, to be provided by the external as of June 30, 2008, its notes, statements of income Touche, for the year 2008. In addition, and as stated in auditors. and material information. It also revised and approved Section 202 of the Sarbanes Oxley Act, the Committee At its extraordinary meeting N°5/2008 held on the annual external audit plan and the means for agreed to pre-approve the contracting of certain auditing May 28, 2008, the Audit Committee, in accordance carrying it out, thus complying with the respective services and those unrelated to the audit, to be provided with SOX 404, approved Enersis’s internal control requirement in the Audit Committee regulations. In by the external auditors. structures and procedures necessary for its financial accordance with the procedures relating to the Ethics At its ordinary meeting N°4/2008 held on April 25, reporting. The Committee also examined the draft Channel and the Handling of Accusations approved 2008, following the holding on April 1, 2008 of the Form 20-F, including the reconciliation with US GAAP according to the provisions of the Sarbanes Oxley ordinary shareholders meeting that renewed the board of the company’s financial statements, and other related Act, the Committee issued its opinion on each of the of Enersis, the Audit Committee agreed to appoint information required by the Securities and Exchange accusations presented, provided guidelines to follow in Hernán Somerville Senn as its chairman and Domingo Commission (SEC) of the United States of America. It each of these and confirmed that the chairman of the as its secretary. It also examined the unconsolidated and also examined the comparative presentation of the Audit Committee should determine the convenience of consolidated financial statements of Enersis S.A. as of IFRS with the adjustments made for the first time to calling an extraordinary meeting of the Committee in March 31, 2008, its notes, statements of income and the company’s financial statements. In addition, and the event that the entity making the accusation justifies material information. In accordance with the procedures as stated in Section 202 of the Sarbanes Oxley Act, it in the opinion of the chairman. As stated in Section relating to the Ethics Channel and the Handling of the Committee agreed to pre-approve the contracting 202 of the Sarbanes Oxley Act, the Committee agreed to Accusations approved according to the provisions of certain auditing services and those unrelated to the pre-approve the contracting of certain auditing services of the Sarbanes Oxley Act, the Committee issued its audit, to be provided by the external auditors. and those unrelated to the audit, to be provided by the opinion on each of the accusations presented, provided At its extraordinary meeting N°6 /2008 held external auditors, presented on that occasion for its guidelines to follow in each of these and confirmed that on June 13, 2008, the Audit Committee examined prior approval. the chairman of the Audit Committee should determine the comparative presentation of the IFRS with the ANNUAL REPORT MANAGEMENT AND PERSONNEL 37 At its ordinary meeting N°8/2008 held on October EXPENSES OF THE AUDIT COMMITTEE DURING 29, 20 0 8, the Audit Commit te e e xamine d the 2008 unconsolidated and consolidated financial statements of Enersis S.A. as of September 30, 2008, its notes, The Audit Committee did not make use of the operating statements of income and material information. In expense budget in 2008 as approved by the company’s accordance with the procedures relating to the Ethics general shareholders meeting held on April 1, 2008. Channel and the Handling of Accusations approved The Committee did not need to hire the services of according to the provisions of the Sarbanes Oxley professional consultants for the performance of its Act, the Committee issued its opinion on each of the duties. accusations presented, provided guidelines to follow in each of these and confirmed that the chairman of the Audit Committee should determine the convenience of calling an extraordinary meeting of the Committee in the event that the entity making the accusation justifies it in the opinion of the chairman. As stated in Section 202 of the Sarbanes Oxley Act, the Committee agreed to pre-approve the contracting of certain auditing services and those unrelated to the audit, to be provided by the external auditors. 38 enersis08 ANNUAL REPORT 04. SENIOR EXECUTIVES REGIONAL CHIEF ACCOUNTING OFFICER CHIEF COMMUNICATIONS OFFICER REGIONAL CHIEF PLANNING & CONTROL OFFICER CHIEF EXECUTIVE OFFICER CHIEF HUMAN RESOURCES OFFICER LEGAL COUNSEL CHIEF AUDIT OFFICER CHIEF REGIONAL FINANCE OFFICER Fernando Isac Comas Economist Universidad de Zaragoza Tax No.: 14,733,649-7 José Luis Domínguez Covarrubias Civil Engineer Pontificia Universidad Católica de Chile Tax No.: 6,372,293-6 Ramiro Alfonsín Balza B.A. in Business Administration Pontificia Universidad Católica de Argentina Tax No.: 22,357,225-1 Ignacio Antoñanzas Alvear Mining Engineer Universidad Politécnica de Madrid Tax No.: 22,298,662-1 Francisco Silva Bafalluy Public Administrator Universidad de Chile Tax No.: 7,006,337-9 Domingo Valdés Prieto Lawyer Universidad de Chile Tax No.: 6,973,465-0 Antonio Zorrilla Ortega Mining Engineer Universidad Politécnica de Madrid Tax No.: 22,551,385-6 Alfredo Ergas Segal Commercial Engineer Universidad de Chile Tax No.: 9,574,296-3 05. ORGANIZATION STRUCTURE CHAIRMAN Pablo Yrarrázaval Valdés CHIEF EXECUTIVE OFFICER Ignacio Antoñanzas Alvear ANNUAL REPORT MANAGEMENT AND PERSONNEL 39 SEVERANCE PAID TO SENIORS EXECUTIVES & MANAGERS The sum of 114 million Chilean pesos was paid in 2008 for this concept. 06. HUMAN RESOURCES COMPOSITION The distribution of Enersis personnel, including information related to subsidiaries in the five countries where the Group operates in Latin America as of December 31, 2008, is the Chief Communications Officer José Luis Domínguez Covarrubias Chief Audit Officer Antonio Zorrilla Ortega following: Chief Human Resources Officer Francisco Silva Bafalluy Chief Regional Accounting Officer Fernando Isac Comas Chief Regional Finance Officer Alfredo Ergas Segal Chief Regional Planning & Control Officer Ramiro Alfonsín Balza Legal Counsel Domingo Valdés Prieto SENIOR EXECUTIVES & MANAGEMENTS FEES SENIOR EXECUTIVES AND MANAGEMENT The total gross remuneration received during 2008 INCENTIVE PLANS by the senior executives mentioned above and other managers of Enersis who do not report directly to the Enersis has an annual bonus plans for its executives chairman or the chief executive officer, totaled 3,108 based on compliance with objectives and the individual million Chilean pesos. level of contribution to the company’s results. This plan includes a definition of the bonus range according to levels of executive hierarchy. The bonuses ultimately granted to the executives consist of a determined number of gross monthly salaries. Company Enersis Endesa Brasil (1) Endesa Chile (2) Chilectra Edesur Edelnor Codensa Synapsis (3) CAM (4) Manso de Velasco (5) Managers  & Senior Executives Professionals  & Technicians Workers &  Others Total 24 49 65 27 28 14 16 12 13 4 124 2,394 2,120 533 1,893 346 916 701 1,159 16 84 363 257 157 669 211 0 97 424 17 232 2,806 2,442 717 2,590 571 932 810 1,596 37 TOTAL 252 10,202 2,279 12,733 Notes: (1) Includes Ampla, Coelce, CIEN, Cachoeira Dourada, Fortaleza & CTM. (2) Includes Ingendesa, Pangue, Pehuenche, Celta, San Isidro, Central Costanera, El Chocón, Edegel, Emgesa, Enigesa, Endesa Argentina, Fundación Endesa Colombia, EEPSA, CEMSA, Dock Sud & Túnel el Melón. (3) Includes Synapsis Argentina, Synapsis Brasil, Synapsis Chile, Synapsis Colombia & Synapsis Perú. (4) Includes Cam Argentina, Cam Brasil, Cam Chile, Cam Colombia & Cam Perú. (5) Includes Soc. Agrícola de Cameros, Aguas Santiago Poniente, Const. y Proyecto Los Maitenes, & Agrícola e Inmobiliaria Pastos Verdes. 40 enersis08 ANNUAL REPORT THE COMPANIES BUSINESSES ANNUAL REPORT THE COMPANIES BUSINESSES 41 Businesses Structure 01. HISTORICAL SUMMARY Generation Distribution (*) (*) Transmission Other Businesses On June 19, 1981, Compañía Chilena de Electricidad S.A. formed a new corporate structure which gave birth to a parent company and three subsidiaries. One of these was Compañía Chilena Metropolitana de Distribucion Electrica S.A. In 1985, under the privatization policy of the Chilean government, the process of transferring the share capital of Compañía Chilena Metropolitana de Distribucion Electrica S.A. to the private sector was begun, ending finally on August 10, 1987. In this process, the pension fund managers (AFPs), company employees, institutional investors and thousands of small shareholders joined the corporation Its organizational structure was based on activities or operating functions whose results were evaluated functionally and its profitability was limited by a tariff structure as a result of the company’s exclusive dedication to the business of electricity distribution. In 1987, the company’s board proposed forming a division for each of the parent company’s activities. Four subsidiaries were therefore created to manage themselves as business units each with its own objects, thus expanding the company’s activities toward other non-regulated activities but linked to the main business. This division was approved by the extraordinar y shareholders meeting of November 25, 1987 which 42 enersis08 ANNUAL REPORT defined their new corporate objects. Compañía Chilena The development of the electricity distribution 02. EXPANSION AND DEVELOPMENT Metropolitana de Distribucion Electrica S.A. thus became business abroad has been implemented jointly with an investment holding company. its subsidiary Chilectra, a company that distributes Enersis started its international expansion in 1992 On August 1, 1988, as resolved at the extraordinary electricity in the Metropolitan Region of Santiago, through acquiring holdings in different privatization shareholders meeting of April 12, 1988, one of the Chile. processes in Latin America, thus developing a significant companies that arose from the division changed its Its investments in electricity generation in Chile presence in the electricity sectors of Argentina, Brazil, name to Enersis S.A. At the extraordinary shareholders and abroad have been developed mainly through its Colombia and Peru. meeting of April 11, 2002, the company’s objects were subsidiary Empresa Nacional de Electricidad S.A. (Endesa modified, introducing telecommunications activities and Chile). 1992 the investment and management of companies whose In addition, it is involved in businesses that • On May 15, it acquired a 60% shareholding and businesses are in telecommunications and information complement its principal ones through majority holdings control of the generator Central Costanera, now technology, and internet trading businesses. in the following companies: Endesa Costanera, in Buenos Aires, Argentina. In 1988, and in order to successfully meet its Synapsis Soluciones y Servicios IT Ltda., that provides • On July 30, it was adjudicated 51% of Empresa development and growth, the company was split services and equipment related to the computer business Distribuidora Sur S.A., Edesur, an elec tricit y into 5 business units which in turn gave birth to and data processing. distributor in the city of Buenos Aires, Argentina. five subsidiaries. Of these, Chilectra and Río Maipo Inmobiliaria Manso de Velasco Ltda., committed to the were responsible for electricity, Manso de Velasco real-estate business through the integral development 1993 concentrated on electrical engineering and construction of real-estate projects and the administration, rental, • In July, it bought the generator Hidroeléctrica El services, plus real-estate management, Synapsis in the purchase and sale of the property assets of Enersis and Chocón, located in the province of Neuquén and area of information technology and data processing, its subsidiaries in Chile. Río Negro, Argentina. while Diprel focused on providing procurement and Compañía Americana de Multiservicios Ltda. (CAM), commercialization of electrical product services. whose business is related to trade and other networking 1994 Today, Enersis is one of the biggest private electricity operations for public-utility companies, preferably in • In July, Enersis acquired for 176 million dollars the groups in Latin America in terms of consolidated assets utility metering service systems and as an agent in 60% of the share capital of Empresa de Distribución and operational income, achieved through steady and purchasing, importing and exporting, as well as a trader Eléctrica de Lima Norte S.A., Edelnor, in Peru. It also balanced growth in its electricity businesses, generation and supplier of materials for Enersis subsidiaries and acquired Edechancay, another electricity distributor and distribution, as well as other related businesses. third parties. in that country, which was later absorbed by the former. ANNUAL REPORT THE COMPANIES BUSINESSES 43 • At the end of the year, Enersis acquired an additional 1997 • On December 28, Enersis was adjudicated 40% of 1.9% of the share capital of Endesa Chile, increasing • On September 5, it acquired for 715 million dollars a the share capital of Esval, in Chile’s 5th Region. its shareholding to 17.2%. 78.9% shareholding in Centrais Elétricas Cachoeira Dourada, Brazil. 1999 1995 • On September 15, Enersis successfully took part in • ENDESA S.A., a spanish company, became the • On December 12, Enersis acquired an additional the capitalization of Codensa S.A. E.S.P., acquiring a controller of Enersis. Through a public share offering, 39% in Edesur to give it control of the company. shareholding of 48.5% for 1,226 million dollars. This the multinational company acquired an additional • It also acquired the generator Edegel in Peru. company distributes electricity in the city of Bogotá holding of 32% in Enersis which, together with the and the department of Cundinamarca, Colombia. It 32% already acquired in August 1997, gave it a 1996 was also adjudicated 5.5% of Empresa Eléctrica de total holding of 64%. This transaction, completed • On Februar y 15, Ener sis reached a 25.28 % Bogotá. on April 7, 1999, involved an investment of 1,450 shareholding in Endesa Chile and, on April 15, • On September 15, it acquired a 75% shareholding, million dollars. As a result of the capital increase Endesa Chile became a subsidiary of Enersis. for an amount of 951 million dollars, in Emgesa, a made in 2003, this shareholding reduced to the • It invested in the sanitation market with the Colombian generator. present 60.62% acquisition of Agua Potable Lo Castillo S.A. • ENDESA S.A. acquired 32% of Enersis. • On May 11, Enersis acquired 35% of Endesa Chile • On December 20, Enersis entered the Brazilian market with the acquisition of a large block of shares 1998 which, added to the 25% already held, enabled it to obtain a 60% shareholding in the generator in the previously-called Companhia de Eletricidade • On April 3, Enersis again entered the Brazilian and made it the parent company. It therefore do Río de Janeiro S.A., Cerj, a company that market, this time being adjudicated 89% and control consolidated its position as one of the principal distributes electricity in the city of Río de Janeiro and of Companhia Energética de Ceará S.A., Coelce, private-sector electricity groups in Latin America. Niteroi, Brazil. Its present name is Ampla Energía e for 868 million dollars. This company distributes Serviços S.A. electricity in the north-east of the country, in the 2000 • On December 20, its acquired a 99.9% shareholding state of Ceará. • As part of its Genesis Plan strategy, the subsidiaries in Central Hidroeléctrica de Betania S.A. E.S.P, in • On April 22, Enersis acquired a 100% shareholding Transelec, Esval, Aguas Cordillera and real-estate Colombia. in Aguas Cordillera, Santiago, Chile. assets were sold for 1,400 million dollars. 44 enersis08 ANNUAL REPORT 2001 2004 • In March, Enersis informed the SVS about the merger • Large investments were made: 364 million dollars for • The Ralco hydroelectric plant began operations. This of Elesur and Chilectra by the absorption of the latter increasing its shareholding in Chilectra, in Chile; 150 is located in Chile’s 8th Region and contributes 690 by the former. The legal effects of this merger were million dollars in the acquisition of 10% of the share MW of capacity. effective from April 1, 2006. capital of Edesur, in Argentina, a percentage that was held by the company’s employees; 132 million 2005 • In June, Edegel and Etevensa were merged, the latter a subsidiary of Endesa Internacional (now Endesa dollars to increase its shareholding in Ampla, in • On April 18, the subsidiary Endesa Eco was formed Latinoamérica) in Peru. Brazil; 23 million dollars to increase its shareholding to promote and develop renewable energy projects • On September 29, Endesa Chile, ENAP, Metrogas by 15% in Río Maipo, in Chile, and 1.6 million dollars like mini-hydroelectric, wind farm, geothermal, solar and GNL Chile signed an agreement defining the to increase its shareholding by 1.7% in Distrilima, and biomass projects, and to act as the depositary structure of the liquefied natural gas (LNG) project in in Peru. 2002 and trader of the emission reduction certificates which Endesa Chile participates with a 20% holding produced by such projects. and which forms part of the strategy for meeting the • The subsidiary Endesa Brasil S.A. was formed lack of natural gas from Argentina. • In Brazil, Central Termoeléctrica Fortaleza in the with all the assets held in Brazil by the Enersis state of Ceará was adjudicated to the company. Group and Endesa Internacional (now Endesa 2007 The commercial operation also began of the Latinoamérica): CIEN, Fortaleza, Cachoeira Dourada, • In March, the company Centrales Hidroeléctricas de second phase of the electricity interconnection Ampla, Investluz and Coelce. It now has the IFC Aysén S.A. (HidroAysén) was formed, to develop between Argentina and Brazil, CIEN, completing a (International Finance Corporation) as a shareholder, and exploit the hydroelectric project in the region of transmission capacity of 2,100 MW between both which contributed a sum equivalent to 50 million Aysén, called the “Aysén Project”, which will imply countries. 2003 dollars. 2006 2,750 MW of new installed capacity for Chile. • In April, the first phase of the San Isidro combined- cycle thermal plant, second unit, with a capacity • Assets of 757 million dollars were sold, including • During February, the Termocartagena (142 MW) of 248 MW, was made available to Economic Load the Canutillar generating plant and the distributor plant in Colombia, which operates with fuel oil Dispatch Center (CDEC-SIC). Río Maipo in Chile. or gas, was bought for approximately 17 million • In September, the merger was completed of the dollars. Colombian generating companies, Emgesa and Betania. ANNUAL REPORT THE COMPANIES BUSINESSES 45 • On October 11, ENEL S.p.A. and ACCIONA, S.A. 03. FINANCIAL ACTIVITIES took over control of Enersis through ENDESA to be traded in the Latin American Securities Market (Latibex) of the Madrid Stock Exchange, with the ticker S.A. and Endesa Internacional, S.A. (now Endesa The financial activities of the Enersis Group have always number XENI. Latinoamérica). been an important and priority matter. Work has been In May 2003, Enersis signed a bank loan for 1,388 • During November, the Palmucho hydroelectric plant carried out on improving the financial profile of both million dollars, called “Jumbo II”, and between June and started up its commercial operations. This plant is Enersis and its subsidiaries, with capital and debt December made a new capital increase which enabled located at the foot of the Ralco plant dam on the issues carried out on the best conditions existing in the company’s capital base to increase by over 2,000 Upper Biobío in Chile’s 8th Region, and contributes the market. million dollars. Refinancing transactions were also 32 MW of capacity to the SIC. The following are among the most relevant financial completed for more than 4,000 million dollars using • Canela was inaugurated on December 6, the first events in the history of Enersis: different instruments like new syndicated loans, bond wind farm on the SIC. Canela is located in the Between 1988 and 1992, Enersis’s shares began to be issues on the domestic and foreign markets, prepayment village of that name in the Region of Coquimbo traded on the local stock exchanges and, on October 20, of the “Jumbo II” loan and other smaller transactions. and contributes 18 MW to the SIC. 1993, on the New York Stock Exchange (NYSE), through During 2004, debt of 2,100 million dollars was 2008 In February 1996, Enersis made a second issue dollars maturing in 2009 was signed. • In January, the second phase of the San Isidro II of shares on both the local and international (ADS) In 2007, two loans of 200 million dollars each were combined-cycle thermal plant began its commercial markets. It also issued bonds in the United States for a obtained, by both Enersis and Endesa Chile, maturing ADS with the ticker number ENI. refinanced and an international loan for 350 million operation of its second unit, with an installed total amount of 800 million dollars, with maturities in in 2010. capacity of 353 MW. 2006, 2016 and 2026. • On March 24, the dual operation of Unit No.1 of In February 1998, Enersis again increased its capital DOMESTIC FINANCES IN 2008 the Tal-Tal thermal plant began operations, with an and issued convertible bonds amounting to 200 million installed capacity of 245 MW. dollars. In February 2008, Enersis registered a domestic line • In June 27, the Ojos de Agua mini-hydroelectric plant In 2000, it made a further capital increase of 525 of bonds for UF 12.5 million which is currently available began operations, contributing 9 MW of installed million dollars approximately, and in July 2001, it and not issued, and in June a term loan agreement was capacity to the SIC. signed a bank loan for close to 500 million dollars. On signed for another 200 million dollars and another loan December 17 the same year, the shares of Enersis began for the same amount. 46 enersis08 ANNUAL REPORT In September, a partial prepayment was made of the million dollars was in the form of a revolving facility year with total available cash of 1,024 million dollars, revolving credit facility whose agent bank is BBVA, for a which is available for drawing at the end of 2008. Enersis with 214 million dollars and Endesa Chile with total of 200 million dollars with which, as of December Drawings were also made under existing revolving 810 million dollars. 31, 2008, there was a principal debt outstanding of credit facilities, whose agents are Caja de Madrid and The consolidated financial debt of Enersis as of 150 million dollars and a balance of 200 million dollars The Bank of Tokyo Mitsubishi for a total of 165 million December 2008 decreased with respect to the end of available for drawing. dollars and 69 million dollars respectively, with which 2007 due to the depreciation of local currencies and a Regarding refinancing agreements, on October these facilities were fully drawn. greater cash generation. The Enersis Group ended with a 17, amendments were signed to the two revolving In December, bonds series M were placed on the total of 7,847 million dollars. Of this, 4,343 million dollars credit facilities of Enersis and three of Endesa domestic market for UF 10 million (some 341 million is with Endesa Chile (consolidated) and 3,504 million Chile, all contracted in 2004 and 2006, in order to dollars) with final maturity in December 2029, equal dollars with Enersis and its foreign subsidiaries. This debt significantly reduce the restrictions in the respective semi-annual repayments starting in December 2020 is divided mainly between bank debt and domestic and bank documentation. The principal changes included: and a nominal interest rate of 4.75%. international bonds. The consolidated cash position of an increase in the trigger for cross-default materiality Regarding the two revolving credit facilities for Enersis closed at 2,045 million dollars, ending with a net to 50 million dollars together with a requirement of an 200 million dollars each contracted in late 2006 by debt of 5,802 million dollars. overdue payment for that same amount; a reduction Enersis and Endesa Chile to maintain the liquidity of in the number of financial covenants; a more relaxed both companies, these were not drawn during 2008 so INTERNATIONAL FINANCES IN 2008 leverage covenant for Endesa Chile; a modification to Enersis and Endesa Chile ended the year with a total the documentation reflecting the adoption of IFRS, and available balance for drawing under revolving facilities of While the second half of 2008 was marked by the financial other changes of definitions and conditions that provide 400 million dollars each. Both Enersis and Endesa Chile crisis that affected the principal economies of the world, a greater flexibility to both companies. also have, at the end of 2008, lines of credit available the foreign subsidiaries of the Enersis Group continued With respect to the financial activities of Endesa Chile, for drawing in the domestic market for the equivalent of to refinance their debt at longer term. This despite the finance was contracted in June 2008 for a total of 400 185 million and 196 million dollars respectively. credit restrictions and reduced access to capital markets. million dollars, whose agent bank is BBVA Bancomer, In addition to the credit facilities and as a way of The foreign subsidiaries have continued to seek financing of which 200 million dollars was drawn as a syndicated safeguarding the liquidity of both Enersis and Endesa in local currency and at longer terms, to the extent that loan with a six-year bullet repayment and an annual Chile and meeting the maturities due in 2009, both their operating cash flows are in those currencies and that interest rate of LIBOR + 0.75%. The balance of 200 companies, on an unconsolidated basis, closed the markets permit it on reasonable conditions. ANNUAL REPORT THE COMPANIES BUSINESSES 47 Consequently, the foreign subsidiaries carried out the proceeds of medium-term bank loans obtained in HEDGING POLICY financial transactions in 2008, both refinancing and December 2007. Coelce in May signed a bank loan to new issues and hedging, for a total equivalent to finance its investments in the 2008-2009 period for EXCHANGE R ATE 2,209 million dollars, of which 125 million dollars were 203 million dollars, a transaction carried out through The Group’s exchange rate hedging policy is based on in Argentina, 594 million dollars in Brazil, 793 million state entities that permitted it to gain access to low- cash flows and its objective is to keep a balance between dollars in Colombia and 697 million dollars in Peru. cost funds. The following are some of the more important financial transactions of 2008: COLOMBIA flows indexed to foreign currency (US$) and the levels of assets and liabilities in that currency. During 2008, Enersis’s financial transactions enabled it to maintain a In generation, Emgesa contracted short-term debt level of dollar liabilities matched to the expected flows ARGENTINA during 2008 for approximately 147 million dollars in that currency. Costanera refinanced maturities for 60 million dollars (including renewals). The distributor Codensa refinanced with medium-term bank loans and supplier credit. El short-term maturities through a domestic bond issue INTEREST RATE Chocón contracted an interest-rate swap at a 3-year for 214 million dollars. term for approximately 50 million dollars which enabled it to fix the interest rate for the whole term of the loan. It PERU The Enersis Group’s policy consists of maintaining hedge levels, total fixed-rate debt and/or hedged debt over total net debt, within a band of more or less 10% also refinanced debt of 12 million dollars, which enabled Edelnor placed domestic bonds for approximately 63 with respect to the hedging level established in the it to re-denominate part of its debt into local currency, million dollars with terms of between 3 and 8 years, annual budget. During 2008, interest rate swaps were according to the indexation of its flows, and extend the using the proceeds to refinance debt maturities. Edegel therefore contracted for 77 million dollars, achieving average term. Edesur signed a bank loan for 3 million issued bonds in dollars and local currency for 29 million a consolidated fixed-rate or hedged debt to total net dollars at short term in the domestic market in order to dollars, the proceeds being used to refinance maturities debt ratio of 86%. refinance part of its debt. and prepay debt. Bank loans were also signed during the year for 96 million dollars (including renewals). In CREDIT RATING BRAzIL March, a financial lease was signed for project financing In January, Ampla refinanced bank loans for 60 million for 90 million dollars at a 9-year term. An interest-rate On November 9, 1994, Standard and Poor’s and Duff dollars corresponding to its 2010 maturities, extending swap was also contracted for 30 million dollars to fix & Phelps rated Enersis for the first time as BBB+, i.e. the term from 2 to 5 years and reducing the interest rate. the rate on a 5-year floating-rate loan. an investment grade company. Later, in 1996, Moody’s In March, it repaid bonds for 163 million dollars from 48 enersis08 ANNUAL REPORT rated the company’s foreign currency long-term debt PROPERTIES AND INSURANCE TO OFFER THE BEST ELECTRICITY SERVICE IN as Baa1. LATIN AMERICA Over time, most of the credit ratings have varied. All The company owns some equipment and substations are now investment grade with stable outlook, based on in the Santiago Metropolitan Region. The company Quality of ser vice is an important matter for the the diversified asset portfolio, the liquidity and suitable holds insurance against risks such as fire, lightning, organization. We are aware that we supply an essential debt service policies. explosions, malicious acts, earthquakes, floods, alluvium service for the social and economic development of the The year 2008 required an especially demanding and others. credit rating from the rating agencies because of the difficult global conditions in the capital markets and REGISTERED NAMES the growing uncertainty with respect to the payment communities where we operate. We therefore force ourselves every day to be more effective and to know our customers in order to offer solid solutions in line with their needs. As a company, we have an attentive capacity of the companies analyzed. The corporation holds the following registered trade organization constantly in contact with the market and In a complex environment, or a clear recession and a names: Enersis, Chispazos, Dixsa, EnersisPLC e Internet its different players. growing number of companies with financial problems, a la velocidad de la luz Enersis PLC. In practice, we have reduced the number of power the rating agencies were focused on liquidity, maturities, cuts per year, their duration and the reliability of the renewal or refining strategy and availability of lines of 04. LINES OF ACTION networks. credit. At the same time, one of our main challenges has been The principal objective of Enersis is to maximize the to contribute to the security of electricity supplies in International Credit Ratings economic value of its equity through stable growth, the five countries where we operate, accompanying the S&P Moody’s Fitch based on rigorously evaluated and managed electricity growth in demand with a mix of generation compatible BBB, Stable Baa3, Stable BBB, Stable businesses. Compliance with this objective is based on an with care for the environment. investment strategy focused on increasing the economic Domestic Credit Ratings value of the subsidiary and associate companies, and MAKING EACH OF OUR OPERATIONS Feller Rate Fitch the acquisition of new companies. PROFITABLE Shares Bonds 1st Class level 1 1st Class level 1 AA-, Stable AA-, Stable Enersis has based its strategy on offering the best electricity service in Latin America, making each of During 2008, our company continued to improve the our operations profitable, maintaining a solid financial returns of the principal subsidiaries in both the electricity position, increasing the value for our shareholders and Generation and Distribution businesses. For example, the evaluating the best growth options. returns on operating revenues in both lines of business ANNUAL REPORT THE COMPANIES BUSINESSES 49 showed important improvements, the result of the complex scenario the market faced, both in Chile and constant application of improvements to production internationally. In addition, the value of the company processes, as a result of the constant investigations over the last five years has grown at a weighted 14%. carried out. This is the result of the better market perception of the diversification of the businesses managed by Enersis. In MAINTAIN A SOLID FINANCIAL POSITION fact, our Group successfully capitalized on the growth shown by the economies of the five countries where Maintaining healthy ratios and the natural match we operate. of currencies between cash flows and third-party obligations, plus hedging against fluctuations in interest INVESTMENT OPPORTUNITIES and exchange rates, together with strong liquidity and access to local and international markets, has been Enersis is constantly evaluating the best growth options indispensable for having a better and healthier financial in both lines of business and the countries where it is structure. currently operating. The company analyzes rigorously Despite the difficult context of the markets, the the different alternatives, taking into account the international credit rating of Enersis was held at BBB contribution that these could make to the points (stable), the rating remaining at investment grade commented on above. by all the rating agencies. Similarly, the domestic A key factor in this matter is to make investments that rating agencies also maintained their local rating of require significantly the experience, management skills AA- (stable). and operating capacities of Enersis and its subsidiaries. This requirement demands making investments in INCREASE VALUE FOR OUR SHAREHOLDERS companies in which a clear influence can be made in their management and operation, and also the power During 2008, our share price on the local market to approve or reject their investment projects. showed a rise of 3% over December 2007, despite the 50 enersis08 ANNUAL REPORT RISK FACTORS ANNUAL REPORT RISK FACTORS 51 Enersis is a corporation whose assets correspond mostly Almost 62% of our consolidated generating capacity to investments made in its subsidiaries. In order to meet in Latin America is hydroelectric so adverse hydrological our financial obligations, we rely on the dividends, conditions can have a negative impact on the business loans, interest payments, capital reductions and other and its operating results. payments that we receive from our subsidiaries, plus the During drought periods, the electricity supplied by issuance of our own shares and our debt capacity. thermal plants is dispatched with greater frequency; Given the nature of the business, as well as to the this includes the electricity supplied by those generators geographical diversification of our investments, there that use natural gas, fuel oil or coal as fuel. Operating are a number of risk factors that could threaten the expenses increase during these periods and, depending stability of our businesses in any of the countries where on the scope of the contracted commitments and with we operate. a view to complying with these contracts the need may However, our long experience in the electricity arise to buy electricity from third parties. The cost of business in the region has taught us to look for and these electricity purchases on the spot market may apply all possible preventive measures aimed at avoiding exceed the agreed price, causing losses. Our generating or moderating unforeseen events or the damage that companies have therefore developed a prudent outside issues could cause to our business. commercial policy that consists basically of contracting Even though risk factors often appear in a combined approximately 70% of the capacity, thereby reducing form or have correlated effects, for purposes of this exposure to abrupt variations in the spot market during Annual Report only, we present the following main periods of water scarcity. structure: Should any of the regulator y bodies impose a rationing policy resulting from extremely adverse OPERATIONAL / COMMERCIAL RISKS hydrological conditions in the countries where we operate, the commercial and financial conditions as An important part of the business of some of our well as the operating results could be affected. The subsidiary companies relies on the hydraulic conditions above, however, is monitored by the commercial area of the areas in which they operate so eventual droughts of each company in order to avoid the negative effects can have a negative impact on Enersis’s earnings. brought on by these circumstances. 52 enersis08 ANNUAL REPORT In Argentina, the low price that the regulatory bodies The results of the Enersis subsidiary and associate monetary assets in the country where our subsidiaries imposed on natural gas has directly affected production companies rely in turn on the macroeconomic and investments operate are not included in the and investments in the deposits of this hydrocarbon, conditions of the country in which they operate. The reported balance sheet, since devaluations of local which at the same time has an impact on the availability product growth rate and variations in aggregate currency against the dollar or the Chilean peso are not of this fuel in Chile. The shortage of natural gas can economic activity intensive in electricity consumption reflected. Precisely in order to moderate the impact of oblige the generators of electricity to resort to the use impact on energy demand and therefore the level of local currency appreciations or devaluations against the of fuel oil, which substantially increases the cost of sales. Inflation, exchange rates and the evolution of U.S. dollar, the debt of the subsidiaries is denominated production. interest rates are all important elements in determining in their respective local currency. Strong electricity demand in the central region of the financial results of the companies. In this sense, Finally, Enersis has debt subjec t to financial Chile, together with the low level of investment in the even though the diversification of the flows in five covenants and other standard contractual restrictions electricity sector, exposes this sector to the adverse countries, in two lines of business, constitutes a natural related to debt-EBITDA and debt-equity ratios. A effects of the Argentine natural gas crisis. hedge, the Enersis Group uses financial products for significant part of Enersis’s debt has cross-default moderating the eventual impact of dramatic changes clauses that in general could lead to a debt acceleration ECONOMIC / FINANCIAL RISKS in exchange and interest rates. when other debts exceeding 30 million dollars are The way in which we value the company’s foreign in default, on an unconsolidated basis. Should the The ability of the subsidiaries to pay dividends, interest investments, in accordance with Chilean accounting creditors demand immediate acceleration of the and loans or make other distributions to the parent principles, forces the conversion of the non-monetary commitments, a significant part of our debt would company is subject to certain legal limits, contractual assets and liabilities of our non-Chilean subsidiaries be payable. restrictions and exchange controls that can be enforced and associate companies to the dollar at historical This however has been compensated by Enersis’s in any of the five countries where the companies operate, exchange rates. Due to this accounting treatment, it current financial strength, which has enabled it to and depends also on the final results. is possible that the effect of a devaluation on non- contract unrestricted lines of credit for its business. ANNUAL REPORT RISK FACTORS 53 Lastly, the management’s constant concern, in terms to offer due satisfaction of the institutional and legal of having a strong balance sheet and a solid financial requirements that each country insists on. situation, has been clearly ratified by the credit-rating Given the mandatory supply required in the concession agencies who, unanimously, raised the rating or rating areas, and as electricity is considered a basic utility, our outlook of Enersis. activities can be subject to regulatory fines resulting from any violation of current regulations, including POLITICAL / REGULATORY RISKS energy faults or problems of quality. Some of the Latin American economies where Enersis Considering that a large part of the Generation and has investments have been characterized by occasional Distribution businesses consists of regulated activities, and drastic interventions by government authorities. For these are exposed to regulatory and tariff changes by example, the Argentine authorities have implemented the authorities in the different countries in which our a series of monetary control and exchange measures subsidiary and associate companies operate. These that have negatively affected the operating results of actions could, in fact, impact the company’s earnings. our subsidiaries in that country and could continue to The operating subsidiaries are also subjec t to impact them negatively. regulations of an environmental nature. However, the Even though the above-mentioned risks are difficult constant concern and commitment of the Enersis Group to anticipate, Enersis permanently monitors the judicial, on this issue should be pointed out. In fact, each project legal and sector regulations in order to evaluate must present an environmental impact assessment as tendencies that could be unfavorable in these areas to essential information in its overall evaluation. This the Group’s businesses in the region. assessment is then submitted to the authorities in order 54 enersis08 ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY BRAzIL ARGENTINA CHILE ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 55 01. ELECTRICITY GENERATION 02. ELECTRICITY TRANSMISSION Electricity generation is mainly carried out through our For the Enersis Group, the electricity Transmission subsidiary Endesa Chile. In this business, the Group business is concentrated on the 2,100 MW interconnection has subsidiaries operating in Chile, Argentina, Brazil, line between Argentina and Brazil, through CIEN, a Colombia and Peru. subsidiary of Endesa Brasil. In all, the installed capacity amounted to 13,893 MW as of December 2008 and the consolidated electricity 03. ELECTICITY DISTRIBUTION production was 54,672 GWh. Energy sales totaled 62,828 GWh. Our electricity distribution business is carried on through In the electricity industry, the segmentation of the Edesur in Argentina, Ampla and Coelce (owned by Endesa business between hydroelectric and thermal generation Brasil) in Brazil, Chilectra in Chile, Codensa in Colombia is natural as the variable costs of generation are different and Edelnor in Peru. Our principal subsidiaries and related for each form of production. Thermal generation requires distribution companies sold 62,806 GWh during 2008. the purchase of fossil fuels and hydroelectric generation Edesur, Ampla, Coelce, Chilectra, Codensa and Edelnor needs water from reservoirs and rivers. serve the principal cities of Latin America and provide an 62% of our consolidated generating capacity comes electricity service to over 12 million customers. from hydroelectric sources while the remaining 38% These companies face an increasing demand for is thermal. energy, obliging them to invest constantly both because The commercial policy that the generator defines is of natural growth and for the maintenance of their therefore important for the business. facilities. PERU COLOMBIA 56 enersis08 ANNUAL REPORT Argentina The transmission sector comprises companies that freely negotiated contracts or at the spot market price set carry electricity from the generation points to the by the Compañía Administradora del Mercado Mayorista consumption points, on the basis of a free-access Eléctrico S.A. (CAMMESA) which is responsible for the system. This segment is organized on a regulated basis operation of the MEM. which requires it to operate, maintain and provide to There are three kinds of prices for valuing energy third parties access to their transmission systems and transactions: contractual, seasonal and spot. The price are authorized to charge a toll for this. However, these paid by the distributors for the electricity obtained on companies are forbidden from generating or distributing the SIN (national grid) is an average spot or seasonal electricity. price that CAMMESA sets every six months and adjusts 01. INDUSTRY STRUCTURE Distribution covers the transfer of electricity from the every three months according to the prices sanction transmitters’ supply points to the users. Distribution mechanism established by Resolution S.E. Nº 240 if 2003 Law 24,065 of January 1992, the Argentine Electricity companies operate as geographic monopolies, providing and that the Secretary for Energy approves according Law, divides the electricity industry into three sectors: the service to users within a specific region. Distributors’ to supply, demand, available capacity and other generation, transmission and distribution. tariffs therefore are regulated and the companies are factors. Contracted prices are agreed freely between The generation sector is organized on a competitive subject to service specifications. While distribution the parties. basis with independent producers that sell their companies can acquire electricity that they need to meet Finally, the spot price is used in transactions between produc tion on the Wholesale Elec tricit y Market demand from the MEM, at seasonal prices or under generators to cover their generating deficits or surpluses (MEM) or under private contracts with other parties contracts with generating companies, they all prefer with respect to the contractual commitments. The final in the MEM. to buy electricity on the MEM as they are only allowed price paid for these transactions includes the spot price The energy price is a value called Marginal Price of to pass on the seasonal prices that reflect the average and a charge for power. the System or Market Price, and represents the economic energy spot price. The Argentine National Grid (SIN) had a mainly- cost of generating the next kWh. All the system’s The Argentine electricity dispatch system, like that thermal installed capacity of 26,226 MW in 2008, 7.5% generators charge for their energy at the marginal price in Chile, is designed to ensure that the least expensive more than the year before. The grid’s annual generation affected by a factor that considers the payment of the electricity reaches the consumer. Generating companies was 112,313 GWh and sales 105,938 GWh, representing losses and transport service. They also receive a payment sell their electricity to distribution companies, energy increases of 3.5% and 2.9% respectively. for power made available to it. traders and large users on the competitive MEM under ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 57 CÓRDOBA BUENOS AIRES MENDOzA NEUQUÉN Generation Central Costanera Type Installed Capacity Thermal 2,324 MW Central Arroyito Type Installed Capacity Hydro 128 MW Central El Chocón Type Installed Capacity Hydro 1,200 MW Distribution Edesur Energy Sales Customers Energy Losses 16,160 GWh 2.3 million 10.6% 58 enersis08 ANNUAL REPORT 02. ELECTRICITY GENERATION ENDESA COSTANERA EL CHOCÓN Enersis participates in electricity generation in Argentina Located in the city of Buenos Aires, its installed capacity Located in the provinces of Neuquén and Río Negro, it through Endesa Costanera and El Chocón in which it has of 1,138 MW is steam-gas thermal and uses natural operates one artificial reservoir hydroelectric plant of direct and indirect shareholdings of 41.8% and 39.2% gas or fuel oil. 1,200 MW and another of 128 MW that use the waters respectively It also operates two combined-cycle plants of 859 MW of the Limay and Collón Curá rivers, and having a total These companies have a combined total of five plants, and 327 MW each, with a total installed capacity of installed capacity of 1,328 MW. totalling 3,652 MW. This capacity in 2008 represented 2,324 MW. The hydrology year that started on April 1, 2008 14% of the installed capacity on the SIN. Net generation in 2008 was 8,540 GWh and total was classified as a “medium year”. From the second The electricity generation of the Enersis Group sales 8,543 GWh. half of May, as a result of the high dispatch assigned reached 10,480 GWh, 9% of the total generated in The year was characterized by important natural-gas to plants located upstream of El Chocón and the that country, with hydroelectric generation accounting restrictions from May to September, which meant a high restricted dispatch applied to this plant, and due to for 19%. Physical energy sales were 11,098 GWh, 10% consumption of liquid fuels. On the other hand, the the hydrological conditions, the company reduced its of the total sold. high energy prices in the first four months of the year net generation and sales, reaching 1,940 GWh and Endesa Costanera and El Chocón have holdings of permitted margins to be higher than in 2007. 2,554 GWh respectively. 5.51% and 15.35% respectively in companies that are The continuous functioning of both combined-cycle During 2008, the company focused on diversifying building two new combined-cycle plants, initiatives plants with gas oil during the winter helped the grid its customer portfolio through trading on other markets coordinated by the Fund for Necessary Investments that at its most critical point, above all taking into account than the spot, giving priority to profitable long.- Permit Increasing Electricity Supplies on the Wholesale that the liquid fuel was foreseen only for exceptional term relations with customers of proven commercial Electricity Market (FONINVEMEN). situations. strength. During 2008, the operation began in open cycle The company’s top priority in 2008 was to cover its With respect to investment projects, it is important of the gas turbines of the Manuel Belgrano and José cash needs, managing to reschedule the maturities of to mention the completion of the raising of the water de San Martín thermal plants, with the closing of the its short-term debt. level at the Arroyito plant reservoir, which will increase cycles expected for the second half of 2009 when the In the regulatory area, the MEM continued to be its generation to around 69 GWh per annum. This new companies start to recover their credits from the cash intervened by the authority in the setting of the sale capacity was classified as New Energy authorized to flows generated. price of hourly energy and the payment for that produced enter the Energy Plus plan conceived by the Argentine Other generators connected to the SIN are AES by generators. Through these measures, the company government, Arroyito being the first hydroelectric plant Alicura, Capex, Petrobras and Pluspetrol. received a partial payment of its monthly credits. in this plan. ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 59 03. ELECTICITY DISTRIBUTION The concession establishes the obligation of Edesur 2007, of 7.8% for May-October 2007 and 6.4% for to supply electricity at the request of the owners or November 2007-April 2008. The adjustment was Enersis participates in electricity distribution in Argentina inhabitants of properties within its concession area, applied from July 1, 2008 and affected the segments through its subsidiary Edesur in which it has a 65.4% meet certain quality standards referring the electricity of residential users with consumption of over 650 kW direct and indirect shareholding. supplied, comply with operational requirements with and users in the general category T2 and T3. The market share of our Argentine subsidiary, in terms respect to the maintenance of the distribution assets and A s a c o m p l e m e n t , b y N o t e 1, 3 8 6 o f t h e of physical sales, is approximately 20%. bill customers on the basis of effective metering. Under-Secretary for Energy, ENRE in November 2008 Other distributors in the Argentine electricity system In 2008, Edesur provided an electricity service provided the surpluses of the Program for the Rational are Empresa Jujeña de Energía (EJESA), Empresa de to 2,262,231 customers, 1.5% more than the year Use of Electricity (PUREE) for costing retroactively the Distribución de Energía de Tucumán (EDET), Empresa before. Of the total, 87% are residential customers, 7.8% adjustment identified by application of the MMC Distribuidora de Energía de Santiago del Estero (EDESE), 11.6% commercial, 1.1% industrial and 0.3% other between November 2007 and June 2008, for the second Empresa Distribuidora y Comercializadora Norte customers. period mentioned above. (EDENOR) and Empresa de Distribución de la Plata Energy sales amounted to 16,160 GWh, representing a Lastly, in November 2008 and by Resolution S.E. (EDELAP). EDESUR 2.1% increase over 2007. This was distributed 40.8% to 1.169/2008, a new adjustment was approved to the the residential sector, 26.1% to the commercial sector, seasonal price of energy fixed by CAMMESA through 9.1% to industry and 24% to others. the spot prices sanction mechanism established in Energy losses were 10.6% in 2008. Resolution 240/2003. The adjustment meant an increase The principal objective of Edesur is to distribute and With respect to the tariff situation, and with the in the seasonal price of energy, from approximately 49 commercialize electricity in the southern part of the city publication in the Of ficial Bulletin of Resolution to 58 Argentine pesos and applied to the tariff for high- of Buenos Aires, comprising two-thirds of the Federal 324/2008 of ENRE, the first tariff adjustment was consumption residential, commercial and industrial Capital region and twelve districts of the province of applied impacting residential customers since the users. Buenos Aires. Its concession area covers 3,309 km2 and devaluation and “pesification” of January 2002, after While the adjustments of 2008 have represented lasts for 95 years from August 31, 1992. which electricity charges were frozen. The adjustment important progress, Edesur has still not been able to This period includes an initial one of 15 years and recognized compensations for the concept of the Costs rebuild its economic-financial ratios this year, affected eight additional ones of 10 years each. On February Monitoring Mechanism (MMC) which activates every six by the devaluation. Its management therefore is directed 5, 2007, the electricity regulatory authority (ENRE) months the process of re-determining the tariff due to to trying to minimize the effects of this situation. resolved to extend the initial period by a further five the distributor’s cost variations. By this resolution, the years as from the completion of the Integral Tariff ENRE authorized an adjustment of 9.7% in recognition Negotiations (RTI). of the increase in costs for the period May 2006-April 60 enersis08 ANNUAL REPORT Brazil to offer reduced tariffs to the customer and ensure the determined through a financial/economic balance. These expansion of the system through EPE (Energy Research are revised and corrected on an annual basis. Company), a state entity responsible for the planning In the free-contracting environment, the conditions for of generation and transmission activities and which buying energy are renegotiable between suppliers and defines two spheres of contracting: free and regulated customers while, in the regulated environment, where environments. the distribution companies operate, energy purchases The contracting of energy by distributors for supplying should be made in a bidding process coordinated by 01. INDUSTRY STRUCTURE their regulated customers is made through a centralized ANEEL. bidding process. The Brazilian SIN has an installed capacity, largely The Brazilian electricity industry is organized in one large Another important change was the separation of hydroelectric, of 102,625 MW in 2008, 2.3% greater interconnected electricity system called the National the bidding process for “existing energy” and “energy than the year before. The annual generation of the Interconnected System (SIN) that covers most of the from new projects”. Plants operating prior to 2000 system was 448,748 GWh with sales of 376,948 GWh, country. are considered as “existing energy” plants and those figures that showed an increase of 2.6% in each case. Generation, transmission and distribution businesses completed after 2000 are “energy from new projects” are separated by law, a situation that prevents plants. ENDESA BRASIL distributors from par ticipating in generation or The first auction for existing generators took place transmission activities and in other companies. in December 2004 in which the distributors contracted Enersis participates in Brazil through Endesa Brasil. The principal regulatory entity is União, acting energy for periods of five to eight years, while the first Enersis began to consolidate Endesa Brasil in October through the Ministry of Mining and Energy which has tender for energy produced by future plants was held in 2005, with a direct and indirect shareholding of exclusive authority over the electricity sector through December 2005. Various tenders have since taken place 53.6%. its concessionary and regulatory powers. The sector’s for both existing and future energy. The objective of the reorganization of all the assets policies are implemented by the National Electric Energy Co nc e s sio ns law e s t ab lish e d t hre e t y p e s of in Brazil was to simplify the organizational structure, Agency (ANEEL), established in accordance with Law modifications regarding energy supply for final thus permitting greater efficiency, transparency in the 9.427/96. customers, which are the following: programmed tariff flows and stability of local cash flows, and thus reduce During recent years, the electricity industry has settings, ordinary correction and extraordinary tariff financing costs; in addition, to improve financing by third suf fered many changes and transformations. In correction. parties and lastly to strengthen the Group’s positioning March 2004, federal laws N° 10,847 and N° 10,848 Regarding tariffs, these should reflect the operating in considering new investment opportunities. established a new model for the sector. This is intended costs of each company plus a certain return on capital ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 61 Generation Central Cachoeira Dourada Hydro Type 665 MW Installed Capacity Central Fortaleza Type Installed Capacity Thermal 322 MW MANAUS BELÉN Distribution Coelce Energy Sales Customers Energy Losses Ampla Energy Sales Customers Energy Losses 7,571 GWh 2.8 million 11.7% 9,119 GWh 2.5 million 20.2% Transmission CIEN Installed Capacity Energy Sales 2,100 MW 2,063 GWh BRASILIA GOIANIA RÍO DE JANEIRO SAO PAULO 62 enersis08 ANNUAL REPORT 02. ELECTRICITY GENERATION Net generation of Cachoeira in 2008 was 3,308 GWh, 03. ELECTRICITY TRANSMISSION while sales were 4,403 GWh, both below the level of Enersis participates in electricity generation in Brazil the previous year. The Enersis Group also participates in the transmission through Endesa Brasil and its subsidiaries Cachoeira Despite this, the better results for 2008 were the and trading of elec tricit y in Brazil through the Dourada and Endesa Fortaleza, in which it has direct consequence of a prudent commercial policy consisting interconnection line between Argentina and Brazil, and indirect shareholdings of 53.4% and 53.6% of adapting energy sales contracts, plus the high price CIEN, in which it has a 53.6% holding. respectively. in the energy market during the first months. Compañía de Transmisión del Mercosur S.A. (CTM) These two plants, one hydroelectric and the other Investments are planned for 2009 in maintenance of is the owner of the Argentine side of the transmission thermal, have a total capacity of 987 MW, representing the plant and four environmental projects. line and CEMSA is the trading company that has signed around 1% of capacity on the SIN. contracts with generators in Argentina for the export of Enersis Group’s electricity generation in Brazil was FORTALEzA PLANT electricity to Brazil and Uruguay. 3,378 GWh, 1% of the country’s total generation, with hydroelectric production representing 98%. Physical Located in the district of Caucaia, 50 km. from the CIEN energy sales amounted to 7,093 GWh, 2% of the total capital of the state of Ceará, it is a combined-cycle energy sold on the system. thermal plant of 322 MW that uses natural gas. Permits the export and import of electricity between Other generators connected to the SIN are CHESF, Generation was 71 GWh and its sales totaled 2,690 Argentina and Brazil, in either direction. It has two Furnas, Cemig, Electronorte, Cesp, Copel, Eletrobras GWh, 8% higher and 1% lower respectively, compared transmission lines with a total installed capacity of and Eletropaulo. to the previous year. 2,100 MW which cover a distance of approximately 500 The reduced results of this plant were due to the km., from Rincón Santa María in Argentina to Itá in the CACHOEIRA DOURADA reduced energy trading margin, reflecting the high spot state of Santa Catarina in Brazil. prices at which it had to buy. Last year, it redesigned its business to produce Located in the state of Goias, 240 km. south of The company’s plans for 2009 are to maintain revenues from tolls. Goiania, its installed capacity of 665 MW is pass- its contractual sales with Coelce and to invest in In 2008, CIEN’s energy sales were 2,063 GWh, 66% through hydroelectric and uses the waters of the maintenance and environmental works. down on the previous year, resulting from the change Paranaiba river. in its business structure. As in 2007, CIEN acted as an ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 63 exporter and importer of energy from Brazil to Argentina. being Niteroi, São Gonçalo, Petrópolis, Campos and the COELCE With this operation, it only obtained revenues from coastal area of Los Lagos. making its networks available. It provides an electricity ser vice to 2,466,468 This is the electricity distribution company of the state Regarding the company’s prospects for 2009, the customers, 3.7% more than the previous year. Of these, of Ceará, in north-east Brazil, and covers a concession company will continue to seek permanent remuneration 89.7% are residential, 6.8% commercial, 0.2% industrial zone of 148,825 km2. The company serves a population from the Brazilian government. It will also invest in the and 3.3% other customers. of more than seven million people. environment and in maintenance. During 2008, the company sold 9,119 GWh to its end The customers of Coelce number 2,841,838, of which 04. ELECTICITY DISTRIBUTION this, 39% was sold to residential customers, 12.6% to and 19.5% other sectors.The number of customers rose customers, representing a 1.5% increase over 2007. Of 75% are residential, 5.3% commercial, 0.2% industrial industrial, 18.9% to commercial and 29.5% to other by 5.7%. Enersis participates in distribution through Endesa Brasil customers. Energy sales in 2008 were 7,571 GWh, 4.8% higher and its subsidiaries Ampla and Coelce. Enersis directly In terms of energy losses, these declined by 1.2 than in 2007. Of this total, 33.2% was to residential and indirectly holds 69.9% of the share capital of Ampla percentage points. The rate was 20.2% in December customers, 18.8% to commercial, 16.8% to industrial and 34.9% of Coelce. 2008, which compares positively with 21.4% in and 31.2% to other customers. The market share of our subsidiaries in Brazil, in terms December 2007. Total energy losses showed a significant improvement, of physical sales, was approximately 5%. The company is continuing to implement better reducing from 12.5% in 2007 to 11.7%. Other distributors in the Brazilian electricity system technologies and remote solutions to combat the theft Regarding tariffs, the annual tariff adjustment was are CPFL, Brasiliana de Energía, AES Elpa, Cemig, Light, of energy. In 2008, 53,896 customers were connected made in 2008 with an increase for Coelce of 6.7%, Coelba and Copel. to the so-called Ampla Network, totaling 501,047 effective April 2008. AMPLA strategy to reduce energy losses year by year. Everyone Program between the federal government, customers to date. This is in line with the company’s For 2009, it is planned to continue with the Light for This is an electricity distribution company that covers tariffs on March 14, 2008, whose average impact on with the Ecoelce project, an initiative that offers to 73% of the area of 32,054 km2 of the state of Rio de consumers meant increases of approximately 11%. exchange waste (which is then recycled) for discounts Janeiro. The population of the area is around eight There will also be a new tariff revision process, to be on electricity charges. Regarding tariffs, an adjustment was made to Ampla’s Coelce and the state government, and also continue million people living in 66 districts, the principal ones completed in March 2009. 64 enersis08 ANNUAL REPORT Chile According to the Chilean electricity law, generating transmission and distribution of electricity associated companies have to coordinate their operations through with an efficient operation in order to provide suitable the Economic Load Dispatch Center (CDEC) in order signals both to the companies and to consumers, in to operate the electricity grid at minimum cost while order to optimize the electricity systems. preserving service security. The CDEC therefore plans One of the general criteria is freedom of prices for and carries out the grid’s operation, including the those segments where competitive conditions are calculation of the marginal cost, the price of energy seen to exist. End users whose connected capacity is transfers between generators. 2,000 kW or less are therefore considered as regulated From a physical point of view, the Chilean electricity customers while those with a connected capacity of over 01. INDUSTRY STRUCTURE sector is divided into four electrical systems: SIC (the 2.000 kW are called free customers. However, users who Central Electricity Grid), SING (the Northern Electricity are between 500 kW and 2,000 kW have the possibility The Chilean electricity sector is regulated by three Grid), and two minor isolated systems in Aysén and of choosing the segment to which they belong. government entities that are responsible for the Magallanes. Prices at the generation-transportation level are called application of and compliance with the law: the National The SIC, the principal electricity grid, is 2,400 km “Node Prices” and are defined for all the generation- Energy Commission (CNE), which has the authority long, from Taltal in the north to Quellón, on the island transportation substations from which supplies are to propose the regulated tariffs (node prices) and to of Chiloé, in the south. With an installed capacity of made and comprise the price of the peak energy and prepare indicative plans for the construction of new 9,824 MW as of December 2008, the system is mainly capacity, and the transmission charge. Prices at the level generating units; the Superintendency of Electricity and hydroelectric. Net generation was 41,869 GWh and sales of distribution, as those of sub-transmission, are set Fuels (SEC), which regulates and checks compliance were 39,594 GWh, representing an increase of 7%. every four years, in alternating even years, the next with the laws, regulations and technical standards for The SING covers some 700 km. in the north of the sub-transmission setting being programmed for the electricity generation, transmission and distribution, country, from Arica to Coloso. This system, with an year 2010. liquid fuels and gas; and the Ministry of the Economy installed capacity of 3,610 MW as of December 2008, As part of the new electricit y regulations, the which revises and approves the tariffs proposed by is predominantly thermal. Net generation was 14,502 contracting of energy by distributors for supply to their the CNE and regulates the granting of concessions to GWh and energy sales were 13,219 GWh. regulated customers should be made through open electricity generating, transmission and distribution Current legislation established as a basic premise that bidding, three tender processes having taken place companies, following a report from the SEC. tariffs should represent the real costs of generation, to date. ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 65 Distribution Chilectra Energy Sales Customers Energy Losses 12,535 GWh 1.5 million 5.9% ANTOFAGASTA SANTIAGO TALCA LINARES CONCEPCIÓN Generation Central Tarapacá Type Installed Capacity Thermal 182 MW Central Atacama Type Installed Capacity Thermal 781 MW Central Tal - Tal Type Installed Capacity Thermal 245 MW Central Diego de Almagro Type Installed Capacity Thermal 47 MW Central Huasco Type Installed Capacity Thermal 80 MW Central Los Molles Type Installed Capacity Hydro 18 MW Central San Isidro Type Installed Capacity Thermal 732 MW Central Rapel Type Installed Capacity Hydro 377 MW Central Sauzal Type Installed Capacity Hydro 77 MW Central Sauzalito Type Installed Capacity Hydro 12 MW Central Cipreses Type Installed Capacity Hydro 106 MW Central Isla Type Installed Capacity Hydro 68 MW Generation Central Canela Type Installed Capacity Wind Farm 18 MW Central Curillinque Type Installed Capacity Hydro 89 MW Central Loma Alta Type Installed Capacity Hydro 40 MW Central Pehuenche Type Installed Capacity Hydro 570 MW Central Ojos de Agua Type Installed Capacity Mini Hydro 9 MW Central Bocamina Type Installed Capacity Thermal 128 MW Central Antuco Type Installed Capacity Hydro 320 MW Central Abanico Type Installed Capacity Hydro 136 MW Central El Toro Type Installed Capacity Hydro 450 MW Central Ralco Type Installed Capacity Hydro 690 MW Central Palmucho Type Installed Capacity Hydro 32 MW Central Pangue Type Installed Capacity Hydro 467 MW 66 enersis08 ANNUAL REPORT 02. ELECTRICITY GENERATION with Chilectra and CGE, the two largest distributors the CDEC-SIC determines a deficit risk condition for in Chile. the grid. Enersis participates in electricity generation through The tightness of supplies, the contraction in demand The company also collaborated with the security plan, Endesa Chile and its subsidiaries, the largest electricity growth, the high cost of fuels and a drought that participating in the accumulation of water resources company in the country in terms of installed capacity, affected the first months of 2008 (a situation that through thermal generation produced without any in which it has a direct 60% shareholding. reversed toward the end of the year) were variables economic logic. Endesa Chile and its subsidiaries possess and operate that largely determined the year’s operating income. With all these measures, the demand for electricity a total of 26 generating plants, 16 of them hydroelectric The tight supply early in the year was due to a declined by 1% during 2008. and 9 thermal plants using coal, oil or natural gas, reduced thaw as a result of the small accumulation of Finally, both the rains that began at the end of May, and a wind farm, with a total installed capacity of snow in the winter of 2007 and the delay in rainfalls which normalized the hydrological situation of 2008, approximately 4,893 MW, representing 36% of Chile’s which did not occur until May. In addition, there was a and the effect of a fall in the rate of electricity demand total installed capacity. prolonged fault at an important thermal plant on the growth, enabled the delicate supply situation to be Electricity generation by the Enersis Group was 19,807 SIC. These two events led to the publication in late overcome. GWh in 2008, 70% being hydroelectric. This represented February of a rationing decree effective until August At the same time and in order to provide security of 35% of the total produced. Physical energy sales 2008, which was extended to the end of October. This supply, Endesa Chile brought forward by two months the amounted to 19,808 GWh, 38% of the total sold. decree included operational measures for improving start-up of the combined cycle of San Isidro II and began Other generators connec ted to the elec tricit y security and the availability of water resources, and the operation of the ...Ojos de Agua mini-hydroelectric grid are AES Gener, Colbún, Electroandina, Edelnor others directed to managing and reducing electricity plant. These projects together added capacity of 114 MW and Norgener. ENDESA CHILE demand, like consumer savings campaigns and voltage during 2008. reductions. Added to this delicate supply situation in the first PEHUENCHE four months, was the insufficient availability of natural Endesa Chile supplies electricity to the principal gas from Argentina and the high fuel prices, which Located in Chile’s 7th Region, it has 3 reser voir regulated distributors, large unregulated industrial raised generation costs and electricity prices on the hydroelectric plants with a total installed capacity of companies (mainly in the mining, woodpulp and steel- spot market. 699 MW. Curillinque is fed indirectly from the Maule making sectors) and on the spot market. Endesa Chile, in addition to the measures included and La Invernada lakes; Loma Alta also uses the waters The most important supply contracts of Endesa in the rationing decree, managed to bring forward the of the Colorado river, and Pehuenche is fed by the Chile with regulated customers refer to its contracts use of the water resources to which it has rights in the abovementioned sources plus the Melado reservoir and Maule and Laja reservoirs, in order to generate when some minor tributories. Enersis holds, directly and indirectly, 55.6% of the share capital of the company. Net generation was 3,589 GWh, while sales were 3,614 GWh. PANGUE Loc ated in Chile’s 8 th Region, 10 0 km east of Los Angeles, its installed capacity of 467 MW is hydroelectric, with reservoir that is fed by the waters of the Bío-Bío river. Enersis has a 60% shareholding. The net generation of Pangue was 1,763 GWh and sales were 1,961 GWh. SAN ISIDRO Located in Chile’s 5th Region, 8 km from Quillota. It is a combined-cycle plant with dual technology which enables it to use natural gas and fuel oil for generation. Its installed capacity is 732 MW (San Isidro I of 379 MW and San Isidro II of 353 MW). Enersis has a 60% shareholding. Both the net generation and sales of San Isidro were 1,289 GWh during 2008. ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 67 CELTA Its two plants are located in Chile’s 1st Region, 65 km from Iquique. Its installed capacity of 182 MW is steam- gas thermal, using coal and oil for generation. Enersis has a 60% shareholding. The net generation of Celta was 912 GWh and sales were 1,062 GWh. CANELA It is located in the 4th Region, 80 km north of the Los Vilos town. It has an installed capacity of 18 MW and is the first wind farm on the SIC, in which Enersis has a 45% shareholding. It is estimated that the operation of the Canela wind farm substitutes annually the emission of up to 23,400 tons of CO2. OJOS DE AGUA Mini-hydroelectric plant located in Chile’s 7th Region, fed mainly by filtrations from the La Invernada lake. Its installed capacity is 9 MW. Enersis has a 60% shareholding. 68 enersis08 ANNUAL REPORT Conscious of the responsibility that our energy GNL QUINTERO LOS CÓNDORES leadership implies, we are developing and analyzing different projects such as: As part of our strategy for ensuring reliable and varied T his proje c t under s tud y w ill make us e of the sources of energy, the company is actively participating 800-meter drop in altitude between Maule Lake and TG QUINTERO in the initiative promoted by the government to diversify the confluence of the Maule River and Las Luces ravine. the energy matrix; this is through the liquefied natural The hydroelectric plant, once operative, will have an This initiative contemplates a thermal plant in Quintero, gas (LNG) project in Quintero. installed capacity of 150 MW. 5th Region, with an installed capacity of 250 MW. It will Endesa Chile has a 20% shareholding in the re- work in open cycle with diesel oil until liquefied natural gasification terminal, along with Enap and Metrogas, NELTUME gas becomes available. Start-up is foreseen for the first while British Gas Group holds the remaining 40%, the half of 2009. CANELA II last-named being the provider of the fuel. The projec t, located in the Region of Los Ríos, It is estimated that the project will start fast-track contemplates the construction of a pass-through operations in the first half of 2009, and on a final step hydroelectric plant of 473 MW, to take advantage of during 2010. the 400-meter altitude difference between the lakes The wind farm, located on the south coast of Canela, will have 40 wind generators with an installed capacity of 60 HIDROAYSÉN MW. It will start operating in the second half of 2009. Pirehueico and Neltume. CHOSHUENCO Company in which Endesa Chile has a 51% shareholding BOCAMINA II and Colbún the other 49%. The hydroelectric plant under study will have an The company is in charge of the project for the installed capacity of 128 MW and with use the waters This project consists of the construction of a coal- construction and operation of five hydroelectric plants of the Llanquihue river between the lakes Neltume fired thermal plant of 370 MW alongside the existing on the Baker and Pascua rivers in the Region of Aysén, and Panguipulli, in hydraulic series with the Neltume Bocamina plant in Coronel, Biobío Region. The unit will in the extreme south of Chile, with a total 2,750 MW. hydroelectric plant. consume pulverized bituminous coal. Start-up is foreseen During 2008, management was focused on the for the second half of 2010. technical area of engineering and environmental studies, PIRUQUINA and communications with its publics of interest. The project consists of the construction of a mini pass- through hydroelectric plant of 7.6 MW to be located in Chiloé and using the waters of the Carihueico river. ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 69 03. ELECTICITY DISTRIBUTION It provides electricity service to 1,533,866 customers, Chilectra recorded energy losses of 5.9%, one of the 3.4% more than the year before. Of the total, 89.9% lowest in Latin America. Enersis participates in electricity distribution in Chile corresponds to residential customers, 7.8 % to In November 2008, the results were published of the through its subsidiary Chilectra in which it directly holds commercial, 0.7% to industrial and 1.6% to other tariff revision corresponding to Distribution Value Added 99.1% of the share capital. customers. (VAD) were published. According to Chile’s tariff regulations covering the During 2008, the company sold 12,535 GWh to its On January 9, 2009, Decree 320 of the Ministry of activities of electricity distributors, the service area end customers, representing a 3% decrease from 2007, the Economy was published in the Official Gazette, of Chilectra is mainly defined as one of high density mainly due to the energy rationing decree issued by the setting the sub-transmission tariffs which came into and includes all the residential, commercial, industrial, government. effect on January 14, 2009 and will remain in force until state customers and those that pay tolls. The Santiago Chilectra bought 11,797 GWh of energy during 2008 2010. The effects for Chilectra are estimated to be a Metropolitan Region is a densely-populated area and from various generators which included Endesa Chile, fall in pre-tax revenues of 52,000 million Chilean pesos has the largest concentration of industries, industrial AES Gener, Colbún and others. annually if the present market conditions and criteria parks and commercial installations in Chile. Oher distributors in the Chilean electricity system are Empresa Eléctrica de Arica, Chilquinta Energía, CGE Distribución, Sociedad Austral de Electricidad, Empresa Eléctrica de la Frontera and Luz Andes Limitada subsidiary. CHILECTRA Chilectra is the largest electricity distribution company in Chile in terms of energy sales. It covers 33 districts of the Metropolitan Region and its concession zone covers an area of 2,037 km2, including those of its subsidiaries Empresa Eléctrica Colina Ltda. and Luz Andes Ltda. for setting the remuneration for this corporate activity are maintained. On January 15, 2008, Decree 207/2007 was published in the Official Gazette setting the installations of the trunk-line system, the area of common influence, the annual cost of transmission by section and its components, with their indexation formulas for the period 2007-2010. In order to ensure its supplies and the corresponding cost, the company has long-term energy purchase contracts with Endesa Chile, AES Gener, Colbún, Carbomet Energía, Sociedad de Canalistas del Maipo, Iberoamérica de Energía IBENER, Hidroeléctrica La Higuera, Hidroeléctrica La Confluencia, Pacific Hydro Chile, Guacolda and HydroChile. 70 enersis08 ANNUAL REPORT Colombia the participation of new ones to just one of them, The distribution sector covers the system of networks establishing limits by market shares. by which electricity is transferred from the connection The Ministry of Mining and Energy defines the policies points of the National Transmission System (STN) to for the energy sector and plans the development and the end consumer or user. These networks comprise expansion of the industry through the Mining and Energy the Regional Transmission Systems (STR) and the Local Planning Unit. Transmission System (SDL), which are distinguished The only interconnected electricity system in Colombia through their different tension levels. is the National Electricity Grid (SIN), comprising the The Colombian electricity market is less regulated than generating plants, grid network, regional and inter- the other countries where the Enersis Group operates. 01. INDUSTRY STRUCTURE regional transmission lines, distribution lines and the The companies are free to offer their electricity at the users. price determined by the market, instead of being obliged The legal principles governing the electricity sector are The Colombian SIN has a capacity of 13,505 MW as of by a centralized operative entity to generate electricity set out in Laws 142 and 143 of 1994, the Colombian December 2008, mainly hydroelectric. Annual generation according to the system’s minimum marginal costs. The Electricity Law. was 54,395 GWh and sales 74,629 GWh, increases of heavy hydroelectric reliance of the Colombian SIN led Law 142 sets certain general principles for the 1.4% and 2.7% respectively. the CREG to design a remuneration scheme to make provision of the public utilities, defining as basic The generating sector is organized on a competitive investment in generation viable. By this mechanism, functions of the state their regulation, vigilance and basis in which generating companies sell their production Firm Energy Obligations (OEF) are assigned which control. The Electricity and Gas Regulation Commission on the energy exchange at spot prices or through freely- relate to generators’ commitments through generation (CREG) was therefore formed to regulate the electricity negotiated contracts with other exchange participants assets capable of producing firm energy during critical sec tor, and the Superintendenc y of Residencial and with unregulated customers. Purchases and sales of supply conditions, which are remunerated with fixed Public Utlities (SSPD) to control compliance with the electricity are carried out through bilateral transactions revenues called charges for reliability. These charges regulations. which can be made between generators, distributors, have been in effect since December 2006 at prices The Colombian Elec tricit y L aw regulates the traders and unregulated customers. However, the CREG defined by the authority (US$13,045/MWh), with annual generation, transmission, commercialization and has been working since 2004 on a proposal to modify indexation until November 2012. As from December that distribution on the basis of ensuring competition. It contracting procedures, to becoming an electronic year, assignments of energy and price will be defined therefore allows any national or international company contracting system called Organized and Regulated through tenders. to par ticipate in any of the ac tivities and limits Market (MOR) to be operative in 2009. Generation Central La Tinta Type Installed Capacity Hydro 20 MW Central Paraíso Type Installed Capacity Hydro 277 MW Central Limonar Type Installed Capacity Hydro 18 MW Central Tequendama Type Installed Capacity Hydro 20 MW Central La Junca Type Installed Capacity Hydro 20 MW Central Charquito Type Installed Capacity Hydro 20 MW Central La Guaca Type Installed Capacity Hydro 325 MW BARRANQUILLA MEDELLÍN BOGOTÁ CALI NEIVA ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 71 Distribution Codensa Energy Sales Customers Energy Losses 11,822 GWh 2.3 million 8.1% Generation Central Cartagena Type Installed Capacity Thermal 208 MW Central El Guavio Type Installed Capacity Hydro 1,213 MW Central Termozipa Type Installed Capacity Thermal 236 MW Central Betania Type Installed Capacity Hydro 541 MW 72 enersis08 ANNUAL REPORT 02. ELECTRICITY GENERATION It is the largest electricity generating company in granting the same rating for the program of issue and Colombia, located close to the city of Bogotá. It has placement of bonds. Enersis participates in electricity generation in Colombia eleven plants with a total installed capacity of 2,895 Its investment projec ts include the El Quimbo through Endesa Chile and its subsidiary Emgesa, in MW, among which is the El Guavio 1,213 MW plant, the hydroelectric plant, to be located in the department which it has an indirect shareholding of 16.1%. largest hydroelectric plant in Colombia. Of the eleven of Huila, on the Magdalena river, upstream from the T his company has an installed c apacit y that plants, nine are hydroelectric and two thermal. Betania plant. Its installed capacity will be 400 MW represented in 2008 21% of the countr y’s total During 2008, Emgesa declared as operational a new and will operate two generating units. generating capacity. unit at the Cartagena plant, expanding the plant’s Emgesa submitted this initiative to the tender for The electricity generation of the Enersis Group installed capacity from 142 MW to 208 MW. reliability charge, as a result of which it is obliged to in Colombia was 24% of the total generated in that Net generation was 12,905 GWh and total sales provide firm energy as from December 2014. market. Its physical energy sales represented 22% of 16,36 8 GW h, both showing increases over the During 2008, progress was made in the identification the total sold. year before. of development opportunities in non-conventional Other generators connected to the Colombian The year 2008 was characterized by strong revenues renewable energies. Negotiations were held for the electricity system are Empresa Pública de Medellín, as a result of larger sales contracts and a reduced cost installation of wind-measurement towers. A s of Isagen, Corelca, EPSA and Chivor. of fuel due to reduced thermal generation. The Cadena December 31, three towers had been erected with EMGESA record level of water was recorded in the El Guavio plant agreements had been reached for the installation of Pagua continued with a record generation. In August, a a development potential of around 150 MW and reservoir, which meant having 36 GWh of additional another two towers. At the same time, negotiations In September 1, 2007 the Colombian companies energy stored. are taking place with the promoter of a 20 MW mini- Emgesa S.A. E.S.P. and Central Hidroeléctrica de In financial terms, Duff and Phelps de Colombia made hydroelectric plant project. Betania S. A . E.S.P. were merged by the lat ter’s its periodic review of the first and third bond issues of absorption by the former, which then changed its name Emgesa, ratifying its AAA rating for the company and to Emgesa S.A. E.S.P. ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 73 During 2008, energy sales were 11,822 GWh to its end customers, representing an increase of 3.3% over 2007. These were distributed 35.7% to residential, 15.7% commercial, 6.3% industrial and 42.3% to other sectors. Energy losses were reduced from 8.7% in 2007 to 8.1% in 2008. Loss management is focused on the incorporation of new technologies and techniques for identifying losses and also on the strengthening of a customer/company relationship based on technical knowledge and the transparency of our actions. As part of the tariff revision process, which is made every five years, Resolution 097 was published in 2008 by which CREG approved the methodology for the remuneration of the distribution business during this period. Also, by Resolution 093, the commission published the rate of return that will be applied to the 03. ELECTRICITY DISTRIBUTION CODENSA Enersis participates in electricity distribution in Colombia Distributes and sells electricity in Bogotá and in 96 distribution business remuneration, defined as 13% for through its subsidiary Codensa, in which it directly and districts of the departments of Cundinamarca, Boyacá the maximum income methodology and 13.9% for the indirectly holds 21.7% of the share capital. and Tolima, comprising an area of 14,087 km2. maximum price methodology. Codensa’s market share, in terms of physical sales, Since 2001, Codensa has only provided services to was approximately 15%. regulated customers. It provides electricity services to Other distributors participating inte Colombian 2,284,855 customers, 3.5% more than in 2007. Of the electricity system are Empresa de Energía Cundinamarca, total, 88.3% are residential, 9.9% commercial, 1.7% EEPP Medellín, Electrificadora de la Costa Atlántica and industrial and 0.1% other customers. Electrificadora del Caribe. 74 enersis08 ANNUAL REPORT Peru Customers with a capacity requirement of less than remuneration in addition to the revenue from the tariffs 1 MW are considered as regulated customers and and connection tolls that reflect a charge per kW. All energy supplies are defined as a public utility. However, the generating companies have access to the lines of according to the First Complementary Provision of Law the secondary system but these are used only to serve 28,832, regulated customers whose annual demand certain customers which have to make payments in is within the demand limits to be established in the relation to the use they make of the system. Complementary Provision may opt to be free users Sales of capacit y or energy by generators to (customers whose capacity requirement is 1 MW distributors for then reselling to their regulated or more). customers should be made at the bar prices set by Electricity tariffs for regulated customers include the OSINERG or at fixed rates as defined by public tenders. bar prices for the energy (analogous with node prices in Since 2005, the bar prices for capacity and energy are 01. INDUSTRY STRUCTURE Chile) and generating capacity, charges for transmission set annually. These are the maximum prices for the services and the VAD (Distribution Value Added), which electricity paid by distributors for transferring it to In Peru, the Ministry of Energy and Mines (MINEM) considers a regulated return on the capital invested, the regulated customers, except in the case of contracts defines the policies for the energy sector and regulates fixed costs of operation and maintenance, and a rule for signed as a result of a public tender, in which case the matters related to the environment. It is also responsible energy distribution losses. prices to be passed on to regulated customers will be for the granting, supervision, expiration and termination Since 1999, the payment for capacity has been the prices defined in the tender. of licenses, permits and concessions for generation, determined in relation to a fixed guaranteed component There is just one main grid system, the National transmission and distribution activities. The Energy based on the efficiency of each plant and a variable Electricity Grid (SEIN), plus many isolated and small Investment Supervisory Organism (OSINERG) is a public component that depends on the level of dispatch of regional systems that provide electricity to rural and autonomous regulatory body established in 1996 each unit. areas. to control compliance with the legal and technical The transmission lines are divided into two systems, Peru has an installed capacity of 5,147 MW in 2008. regulations related to electricity and hydrocarbon the principal and the secondary. All the generators The annual generation of the system was 29,559 GWh businesses, and compliance with the obligations have access to the lines of the principal system, which and sales were 26,771 GWh, which represented a 8.8% container in concession contracts, plus the conservation enables them to carry electricity to all users. The increase over the previous year. of the environment in relation to these activities. transmission concession-holder receives a fixed annual Generation Central Moyopampa Type Installed Capacity Hydro 65 MW Central Callahuanca Type Installed Capacity Hydro 80 MW Central Huinco Type Installed Capacity Hydro 247 MW Central Matucana Type Installed Capacity Hydro 129 MW Central Huampani Type Installed Capacity Hydro 30 MW Central Santa Rosa Type Installed Capacity Thermal 229 MW Central Ventanilla Type Installed Capacity Thermal 493 MW Central Yanango Type Installed Capacity Hydro 43 MW Central Chimay Type Installed Capacity Hydro 151 MW ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 75 Distribution Edelnor Energy Sales Customers Energy Losses 5,599 GWh 1.03 million 8.2% CHICLAYO TRUJILLO LIMA CUzCO AREQUIPA 76 enersis08 ANNUAL REPORT 02. ELECTRICITY GENERATION Demand for natural gas from Camisea has increased reflected on the spot market, where the marginal costs significantly due to the sharp rise in the demand for “of gas” were expected to be around US$30/MWh Enersis participates in electricity generation in Peru electricity, of around 9%, and, to a lesser extent, the when in fact units were seen to operate with residual through Endesa Chile and its subsidiary Edegel, in which migration of industrial users to natural gas in view of diesel or diesel 2 at costs of over US$150-200/MWh. it indirectly holds 19.8% of the share capital. the high international oil prices. This led to congestion This congestion is expected to last throughout 2009 The company had a capacity in 2008 that represented in the natural gas transportation as from May due to but the government has designed several measures for 28% of the country’s total installed capacity. the insufficient capacity of the pipeline. mitigating the situation. The electricity generation of the Enersis Group was The impact on the electricit y system has been At present, Edegel has firm contracts for the full 27% of the total generated in Peru, while its physical important as only 70% of the natural gas volume capacity of its Ventanilla combined-cycle plant, and for sales were 32% of the total sold. requested by generators and the needs of the COES 50% of the TG8 unit of the Santa Rosa thermal plant, Other generators connected to Peruvian electricity was authorized, i.e. during low water periods, some projected to start up in September 2009. The rest of system are Electroperú and Egenor. 200 MW in gas turbines have not operated due to the its contracts are interruptible, as the operation of its lack of transportation capacity. This in turn has been units is not in base. EDEGEL This company is located close to the city of Lima. It has nine plants with a total installed capacity of 1,467 MW. Only two units are thermal plants that use natural gas as their generating fuel. The generation of Edegel was 8,102 GWh and its physical sales were 8,461 GWh, both being 5.8% higher than the year before; this partly explained the good results for the year. Progress was made in 2008 in the identification of development opportunities in non-conventional renewable energies. Temporary concessions have been requested and obtained for wind generation for a total of 1,200 MW. In addition, studies were advanced for identifying the locations of future thermal and hydroelectric units. At the same time, the works for the preparation of the site were successfully completed and civil works began in the Santa Rosa plant extension project. ANNUAL REPORT DESCRIPTION OF THE ELECTRICITY BUSINESS BY COUNTRY 77 03. ELECTICITY DISTRIBUTION Enersis participates in electricity distribution in Peru through its subsidiary Edelnor in which it directly and indirectly holds 33.5% of the share capital. The market share of our subsidiary, in terms of physical sales, was approximately 19%. Other distributors that participate in the Peruvian elec tricit y s ystem are Luz del Sur, Elec tro Sur, Electrocentro, ENOSA, Hidrandina and ENSA. EDELNOR The concession zone granted to Edelnor covers a total area of 2,440 km2, of which 1,838 km2 relate to northern Lima and Callao. are residential, 4% commercial, 0.1% industrial and Energy losses as of December 2008 were 8.2%, Edelnor is the concession-holding company of 1.8% other customers. a slight increase over the rate of 8.1% obtained public-utility service for the northern part of the Lima Physical energy sales in 2008 were 5,599 GWh, in 2007. metropolitan area and the province of Callao, plus representing a 7.7% increase over 2007. The sales Regarding tariffs, these are set every four years, the the provinces of Huaura, Huaral, Barranca and Oyón. grow th is explained by the higher consumption last being in 2005, so the next revision is programmed It serves 52 districts exclusively and shares with the by regulated customers, mainly in the residential, for November 2009. southern zone distribution company in another 5 commercial, transport, storage and communication With respect to transmission, the process of the districts. In the metropolitan area, Edelnor’s concession sectors, and in the manufacture of rubber products. Regulation of Complementary Transmission Systems consists mainly of the industrial zone of Lima and some Edelnor’s energy purchases amounted to 5,648 GWh, for the period July 2006-April 2013 began in June, in populous districts of the city. an increase of 7.4% over 2007. The principal suppliers accordance with OSINERG Resolution 198-2008-OS/CD. Edelnor provides electricity services to 1,027,750 were Electroperú (40.2%), Edegel (30%), Egenor This process will end in April 2009. customers, a 4.2% increase over 2007. Of these, 94.1% (5.9%), Pesa (5.1%) and Cahua (3.1%). 78 enersis08 ANNUAL REPORT OTHER BUSINESSES ANNUAL REPORT OTHER BUSINESSES 79 CAM In terms of innovation, more than 30 new high- technology products were created for the management Enersis, directly and indirectly, holds 100% of Compañía and commercialization of electricity. Americana de Multiservicios Ltda. (CAM). Its business Strategic alliances and commercial agreements were is to provide electrical and related business solutions also strengthened with several companies like Phillips, in three lines of action: metering and certification, Schneider, EMH and Complant. commercialization and logistics, and electrical works. The parent company in Chile and its subsidiaries in MANSO DE VELASCO Argentina, Brazil, Colombia and Peru, have consolidated a regional presence, expanding its customer portfolio Inmobiliaria Manso de Velasco Ltda., a company in which in the electrical, sanitation, gas, industrial, mining and Enersis directly and indirectly has a 100% shareholding, telecommunications sectors. focuses its business on real-estate development projects CAM obtained its ISO 9001:2000 certification for and on advising Group companies in Latin America in all its subsidiaries, thus complying with the corporate everything related the purchase, sale and development objective of cultivating a culture oriented to quality, of real-estate. based on the commitment to achieve organizational During 2008, progress was made on the urbanization efficiency and continuous improvement. and commercialization of the ENEA project for the During 2008, CAM continued its regional integration industrial sector, and the selling of properties in the and consolidation process, with emphasis on seeking municipality of Santiago. In the first case, works new markets and businesses and on the development continued on extending the urbanization of phases I and of innovative products. III in order to permit the sale of these plots located on In this context, notable was the implementation of the east and west sides of Avda. Américo Vespucio. architectural and ornamental lighting projects, services ENEA also continued to progress its commercial plan, and audits for the mining industry, and implementation integrating new companies in the business park. Aguas of energy-efficient solutions. Sale contracts were also Santiago Poniente S.A. is included in this project, a entered into for the supply of electrical equipment to company that provides sanitation services related to Ecuador, of services in Colombia and of tele-metering this real-estate project. for the distributor Light in Brazil. 80 enersis08 ANNUAL REPORT In addition, there is the Tapihue Project which plus a commercial office in Panama City, thus providing In order to position itself as an implementer and contemplates plots corresponding to land associated coverage of a large part of the Latin America. integrator of ERP for ISU SAP utilities, it signed two with the Tapihue, Amancay (Plot B) and La Petaca The most important areas of Synapsis’s business important contracts for introducing this solution in farms. relate to outsourcing and infrastructure services, data Lipigas (Chile) and the Corrientes Provincial Energy The business of Manso de Velasco also includes centers, contact centers, mass printing, remote services Authority (DPEC) (Argentina). managing a total of 23,972 m2 of construc tion applications (ASP), and advice and implementation of Also notable were the start-up of the project for corresponding to office buildings and commercial offices solutions in tele-metering, remote control, security and New EPS in Colombia, the start of outsourcing of which are mainly rented to related companies and other location of vehicles; consultancy in the search for and the technological platform and associated services parties. SYNAPSIS implementation of technological solutions for supporting to ChileCompra, now Mercado Público, and the business processes; the integration of products, services development of three important projects for the Instituto and technologies, implementation and maintenance of de Normalización Previsional (INP) (the Chilean national information systems; construction and development of social security entity). Synapsis Soluciones y Servicios IT Ltda. is an information IT solutions for highly-available and complex business In Chile, it achieved the SAP Hosting Par tner technology (IT) professional services company in which processes. certification which guarantees the high standards of Enersis directly and indirectly has a 100% holding. The company has increased its presence in the IT the services provided by the company according to With more than 20 years’ experience in the market, market in recent years. It manages six integrated and the world-wide demands of SAP, thus improving the it has positioned itself as a Latin American leader strategically positioned data centers, with a highly- company’s position with respect to the local and regional in the field of IT solutions, mainly in the services, qualified professional team and providing guaranteed markets. It again renewed its Microsoft Gold Partner energy, telecommunications and public administration high-availability services. certification, and also signed alliances with Verifone, markets. Synapsis is oriented to the optimization of business Enterprise DB, Corinex and Matchmind. Located in Santiago, Chile, it has offices in the management and process efficiency through the ISO Lastly, the company launched “Synapsis Green”, a principal cities in the region: Buenos Aires, Argentina; 9001-2000, ITIL, PMP and CMMI 3 certifications, new concept that incorporates into the management of Rio de Janeiro, Fortaleza and a commercial office in focusing on IT, telecommunications and control the business the implementation of responsible practices Sao Paulo, Brazil; Bogotá, Colombia, and Lima in Peru, systems. from an environmental point of view. ANNUAL REPORT OTHER BUSINESSES 81 DIRECT AND INDIRECT ECONOMIC PARTICIPATION (*) ARGENTINA Costanera El Chocón Edesur CTM TESA CEMSA CAM Argentina Synapsis Argentina Gasoducto Atacama Argentina CHILE Endesa Chile Celta Endesa Eco Ojos de Agua Palmucho San Isidro Pangue Pehuenche Canela HidroAysén GasAtacama Chilectra Transquillota CAM Inmobiliaria Manso de Velasco Synapsis Ingendesa Túnel El Melón Gas Atacama Chile Gasoducto Tal Tal Electrogas GNL Chile GNL Quintero Business Participation Gx Gx Dx Tx Tx Tx Ox Ox Ox 41.8% 39.2% 65.4% 53.6% 53.6% 27.0% 100.0% 100.0% 30.0% Business Participation Gx Gx Gx Gx Gx Gx Gx Gx Gx Gx Gx Dx Tx Ox Ox Ox Ox Ox Ox Ox Ox Ox Ox 60.0% 60.0% 60.0% 60.0% 60.0% 60.0% 57.0% 55.6% 45.0% 30.6% 30.0% 99.1% 30.0% 100.0% 100.0% 100.0% 60.0% 60.0% 30.0% 30.0% 25.5% 20.0% 12.0% BRAZIL Endesa Brasil Fortaleza Cachoeira Dourada Ampla Coelce CIEN CAM Brasil Synapsis Brasil Ingendesa Brasil COLOMBIA Emgesa Codensa CAM Colombia Synapsis Colombia PERU Edegel Edelnor CAM Perú Synapsis Perú Business Gx, Dx, Tx Gx Gx Dx Dx Tx Ox Ox Ox Participation 53.6% 53.6% 53.4% 69.9% 34.9% 53.6% 100.0% 100.0% 60.0% Business Participation Gx Dx Ox Ox 16.1% 21.7% 100.0% 100.0% Business Participation Gx Dx Ox Ox 19.8% 33.5% 100.0% 100.0% Notas: Gx: Generation. Tx: Transmission/Commercialization. Dx: Distribution. Ox: Others. (*) Operative companies of the Enersis Group considered. 82 enersis08 ANNUAL REPORT PERIMETER OF CORPORATE PARTICIPATIONS OF ENERSIS Endesa Market Place S.A. 15.00% 99.991% 99.99997% 99.99% Compañía Americana de Multiservicios Ltda. CAM Inmobiliaria Manso de Velasco Ltda. Synapsis Soluciones y Servicios IT Ltda. 0.01 % 0.009% 0.00003 % 26.2% 99.9998% 0.0002% 94.90% 2.4% 94.9999 % 99.99993% 0.00007% CAM Perú Ltda. 0.000062% 57.50% Soc. Agrícola de Cameros Ltda. 99.999938% CAM Colombia Ltda. 25.82% Aguas Santiago Poniente S.A. 4.9988 % 55.00% 0.0012% 55.00% 53.06% Agrícola e Inmobiliaria Pastos Verdes Ltda. Const. y Proyectos Los Maitenes S.A. 95.00% CAM Argentina Ltda. 49.00% Sistemas SEC S.A. Konecta Chile S.A. Synapsis Perú Ltda. 99.998243 % Synapsis Colombia Ltda. 0.2% Chilectra Inversud S.A. 2.5% 0.001757 % Synapsis Argentina Ltda. 5.0001 % 99.90% Luz Andes S.A. 0.10% 0.0002% Empresa Eléctrica de Colina S.A. 99.9998% 99.99985 % CAM Brasil Multiservicios Ltda. 0.00017% 0.05 % 99.95 % Synapsis Brasil Ltda. Chile Argentina Brazil Peru Colombia España 0.012666 % 59.98% 99.0778566% Inversiones Codensa S.A. 94.50 % 5.20 % Inversora Codensa Ltda. U 100 % Edelnor S.A. 60.00% Inversiones Distrilima S.A. 30.14% 25.00% 13.25% Compañía Peruana de Electricidad S.A. 0.10% 50.90% Empresa de Energía de Bogotá S.A. 51.51% Codensa S.A. 1.06% 1.41% 9.35% 12.47 % 27.1945% Distrilec Inversora S.A. 0.89% 23.41% 16.02% Edesur S.A. 20.84% 56.36% 50% Sacme S.A. 22.060295% Endesa Brasil S.A. (Holdco) 4.657017% 4.347304% 10.344606% 13.679789% 13.679789% 10.344606% 21.022414% Ampla Investimentos S.A. 46.886283% 46.886% Ampla Energia e Serviços S.A. 21.022% 36.430633% 63.569367% 2.273448% 100% Investluz S.A. Coelce S.A. CIEN S.A. 100% C.G.T. Fortaleza S.A. 99.605880% Cachoeira Dourada S.A. 56.594007% Endesa Market Place S.A. 15.00% 99.991% 99.99997% 99.99% Compañía Americana de Multiservicios Ltda. CAM 0.009% 0.00003 % Inmobiliaria Manso de Velasco Ltda. Synapsis Soluciones y Servicios IT Ltda. 0.01 % Konecta Chile S.A. Synapsis Perú Ltda. 26.2% 99.9998% 0.0002% 94.90% 2.4% 94.9999 % 99.99993% 57.50% Soc. Agrícola de Cameros Ltda. 0.00007% CAM Perú Ltda. 0.000062% 95.00% CAM Argentina Ltda. 49.00% Sistemas SEC S.A. 4.9988 % 55.00% 0.0012% 55.00% Agrícola e Inmobiliaria Pastos Verdes Ltda. Const. y Proyectos Los Maitenes S.A. 99.999938% CAM Colombia Ltda. 25.82% Aguas Santiago Poniente S.A. Synapsis Colombia Ltda. 0.2% Chilectra Inversud S.A. 53.06% 2.5% Synapsis Argentina Ltda. 5.0001 % 99.90% Luz Andes S.A. 0.10% 99.998243 % 0.001757 % 0.0002% Empresa Eléctrica de Colina S.A. 99.9998% 99.99985 % CAM Brasil Multiservicios Ltda. 0.00017% 0.05 % 99.95 % Synapsis Brasil Ltda. Chile Argentina Brazil Peru Colombia España ANNUAL REPORT OTHER BUSINESSES 83 0.012666 % 59.98% 99.0778566% Inversiones Codensa S.A. 94.50 % 5.20 % Inversora Codensa Ltda. U 100 % Edelnor S.A. 60.00% Inversiones Distrilima S.A. 30.14% 25.00% 13.25% Compañía Peruana de Electricidad S.A. 0.10% 50.90% Empresa de Energía de Bogotá S.A. 51.51% Codensa S.A. 1.06% 1.41% 9.35% 12.47 % 27.1945% Distrilec Inversora S.A. 0.89% 23.41% 56.36% 16.02% Edesur S.A. 20.84% 50% Sacme S.A. 22.060295% Endesa Brasil S.A. (Holdco) 4.657017% 4.347304% 10.344606% 13.679789% 13.679789% 10.344606% 21.022414% Ampla Investimentos S.A. 46.886283% 46.886% Ampla Energia e Serviços S.A. 21.022% 36.430633% 63.569367% 2.273448% 100% Investluz S.A. Coelce S.A. CIEN S.A. 100% C.G.T. Fortaleza S.A. 99.605880% Cachoeira Dourada S.A. 56.594007% 84 enersis08 ANNUAL REPORT PERIMETER OF CORPORATE PARTICIPATIONS OF ENDESA CHILE 41.9411% Hidroinvest S.A. 54.1535% 59.00% 2.4803% Hidroeléctrica El Chocón S.A. 6.1938% 15.35% 15.35% Termoeléctrica Manuel Belgrano S.A. 5.5055% Termoeléctrica José de San Martín S.A. 5.5055% Com. de Energía del Mercosur S.A. (CEMSA) 45.00% 59.98% Endesa Argentina S.A. 99.657366% 0.342634% Southern Cone Power Argentina S.A. 2.0% 98% 51.932539% 5.5% Endesa Costanera S.A. 12.3325533% Distrilec S.A. 0.887466% Ingendesa Do Brasil Ltda. 1.00% 99.00% 60.99845% 36.268461% Generandes Perú S.A. 54.19961% Edegel S.A. 4.184465% Endesa Brasil S.A. (Holdco.) 46.886283% Ampla Investimentos S.A. 36.430633% Ampla Energia e Serviços S.A. 63.569367% Investluz S.A. 46.886283% 56.594007% CIEN S.A. 2.273448% Coelce S.A. 100% 26.873987% Emgesa S.A. 51.51% Empresa de Energía de Bogotá S.A. 51.51% Codensa 100% 0.0000018% Transportadora de Energía del Mercosur S.A.(TESA) 99.999982% Cía. de Transmisión del Mercosur S.A. (CTM) 99.99% 100% C.G.T. Fortaleza S.A. Inversora Codensa Ltda. U 99.605880% Cachoeira Dourada S.A. 5.20% Inversiones Codensa S.A. 94.50% 99.51% Enigesa S.A. 0.49% 92.65% Pehuenche S.A. 94.97519% Pangue S.A. 0.01382% 99.9911% Túnel El Melón S.A. 0.00886% 98.75% Ingendesa S.A. 1.25% 33.33% GNL Chile S.A. 20% GNL Quintero S.A. 100% Cía. Eléctrica San Isidro S.A. 99.942802% Cía. Eléctrica Tarapacá S.A. 0.057198% Central Eólica Canela S.A. 75% 99.99% Endesa Eco S.A. 0.01% 50.99995% Centrales Hidroeléctricas de Aysén S.A. 0.00005% 99.00% 0.51% HidroAysén Transmisión S.A. 50.00% Consorcio Ingendesa Minmetal Ltda. 50.00% Consorcio Ingendesa-Ara Ltda. 50.00% Consorcio Ara-Ingendesa Ltda. 33.33% Consorcio Ara-Ingendesa Sener Ltda. 50.00% 0.02125% 99.95% Transquillota Ltda. Electrogas S.A. 99.877% 0.1226% 100% Gasoducto Taltal S.A. Gasoducto Atacama Argentina S.A. Sucursal Argentina Chile Argentina Peru Brazil Colombia Islas Caymán 100% Energex Co. 42.50% Inversiones Electrogas S.A. 99.9% Progas S.A. 0.1% Inversiones GasAtacama Holding Ltda. 50.00% 99.99% 0.01% Inversiones Endesa Norte S.A. 0.05% 99.90% Gas Atacama Chile S.A. 99.997706% 0.001147% GasAtacama S.A. Atacama Finance Co. 99.90% 0.1% 0.03% Gasoducto Atacama Argentina S.A. 57.23% 42.71% 41.9411% Hidroinvest S.A. 54.1535% 59.00% 2.4803% Hidroeléctrica El Chocón S.A. 6.1938% 15.35% 15.35% Termoeléctrica Manuel Belgrano S.A. 5.5055% Termoeléctrica José de San Martín S.A. 5.5055% Com. de Energía del Mercosur S.A. (CEMSA) 45.00% 59.98% Endesa Argentina S.A. 99.657366% 0.342634% Southern Cone Power Argentina S.A. 2.0% 98% 51.932539% 12.3325533% 5.5% Endesa Costanera S.A. Distrilec S.A. 0.887466% Ingendesa Do Brasil Ltda. 1.00% 99.00% 60.99845% 36.268461% 4.184465% Endesa Brasil S.A. (Holdco.) 46.886283% Ampla Investimentos S.A. 36.430633% Generandes Perú S.A. 54.19961% Edegel S.A. Ampla Energia e Serviços S.A. 63.569367% Investluz S.A. Empresa de Energía de Bogotá S.A. 46.886283% 56.594007% CIEN S.A. 2.273448% Coelce S.A. 100% 26.873987% Emgesa S.A. 51.51% 51.51% Codensa 100% Transportadora de Energía del 99.999982% 0.0000018% Mercosur S.A.(TESA) Cía. de Transmisión del Mercosur S.A. (CTM) 99.99% 100% C.G.T. Fortaleza S.A. Inversora Codensa Ltda. U 99.605880% Cachoeira Dourada S.A. 5.20% 94.50% Inversiones Codensa S.A. 99.51% Enigesa S.A. 0.49% 92.65% Pehuenche S.A. 94.97519% Pangue S.A. 0.01382% 99.9911% Túnel El Melón S.A. 0.00886% 98.75% Ingendesa S.A. 1.25% 33.33% GNL Chile S.A. 20% GNL Quintero S.A. 100% Cía. Eléctrica San Isidro S.A. 99.942802% Cía. Eléctrica Tarapacá S.A. 0.057198% Central Eólica Canela S.A. 75% 99.99% Endesa Eco S.A. 0.01% 50.99995% Centrales Hidroeléctricas de Aysén S.A. 0.00005% 99.00% 0.51% HidroAysén Transmisión S.A. 50.00% Consorcio Ingendesa Minmetal Ltda. 50.00% Consorcio Ingendesa-Ara Ltda. 50.00% Consorcio Ara-Ingendesa Ltda. 33.33% Consorcio Ara-Ingendesa Sener Ltda. 50.00% 0.02125% 99.95% Transquillota Ltda. Electrogas S.A. 42.50% Inversiones Electrogas S.A. 99.9% Progas S.A. 0.1% Inversiones GasAtacama Holding Ltda. 50.00% 99.99% 0.01% Inversiones Endesa Norte S.A. 0.05% 99.90% Gas Atacama Chile S.A. 99.997706% 0.001147% GasAtacama S.A. 99.90% 0.1% Atacama Finance Co. 0.03% Gasoducto Atacama Argentina S.A. 57.23% 42.71% 99.877% 0.1226% 100% Gasoducto Taltal S.A. Gasoducto Atacama Argentina S.A. Sucursal Argentina ANNUAL REPORT OTHER BUSINESSES 85 Chile Argentina Peru Brazil Colombia Islas Caymán 100% Energex Co. 86 enersis08 ANNUAL REPORT SUSTAINABILITY ANNUAL REPORT SUSTAINABILITY 87 01. SUSTAINABILITY POLICY Basically, our actions as a company are sustained by three basic pillars for Sustainable Development: In Enersis, we assume our role as a corporate citizen from contribute to economic development, contribute to social the perspective that our actions affect and are affected progress and contribute to the ecological balance of by a series of socio-economic and cultural relations in our surroundings. the surroundings in which we operate. We therefore These criteria form part of the central actions for promote a balanced development of our businesses, ensuring the profitability and leadership of our company stimulating economic growth and promoting the social in the long term and are firmly entrenched in our development of the communities, while contributing to corporate values. the preservation of the environment. PRINCIPLES FOR SUSTAINABLE DEVELOPMENT The Sustainability policy of Enersis is enshrined in the Seven Commitments for Sustainable Development, guidelines made public by our parent, ENDESA S.A., in 2003. These principles are aligned with the company’s corporate vision, mission and values and are the criteria that guide the balanced compliance of our responsibilities in the economic, social and environmental spheres. FOCUS ON EDUCATION Good Governance Commitment with good governance and ethical behavior Innovation Commitment with efficiency Results Orientation Commitment with the creation of value and profitability Community and the Environment Commitment with protection of the surroundings Environmental Dimension Economic Dimension Our People Commitment with the health, safety and personal and professional development of our personnel Social Dimension Our Environment Commitment with the development of the societies in which we operate As a business group, we believe that Latin America should venture strongly and decidedly, and with a long- term view, in the education of our children and young people, the pillars of the region’s future growth. Customer Orientation Commitment with quality of service 88 enersis08 ANNUAL REPORT We have therefore adopted as an action focus of For these reasons, we have assumed the challenge of In these eight years, 49 religious and civil monuments our Sustainability policy, the support, promotion and contributing to the development of education through in Chile have been illuminated within this program. development of activities in the area of education. concrete actions that impact and contribute to some During 2008, the lighting was inaugurated of San We are firmly convinced that to take the large leap degree to improving the quality of life. Pablo de Carahue Church and Sagrado Corazón de Jesús that Chile and Latin American countries need, both the public administration and private-sector companies 02. ACTIONS 2008 should concentrate a large part of their efforts on Cathedral in Villarrica, both in the Región of Araucanía, and Nuestra Señora del Tránsito Church in Molina, located in the town of Molina in the 7th Region. improving the quality of education, a fundamental tool The following describes some of the activities carried out for facing the challenges that society imposes on us by our company, with a clear focus on actions related CHILE IN FOUR MOMENTS every day. to education, all in order to contribute to economic The Enersis Group, El Mercurio and Universidad de Los Everyone is aware of the various strengths we have growth, social progress and the ecological balance of Andes launched the Chile Bicentenary in Four Moments as a nation, like having a healthy macro-economy, a our surroundings. recognized institutional structure and a consolidated project in September 2008. Our company thus performed a clear action for improving the education of thousands capitals market. However, we must move forward and EDUCATION AND CULTURE of Chilean children who will be able to see this collection improve the areas where there are weaknesses, like free of charge. education, a factor that certainly has undermined faster ILLUMINATING MONUMENTS IN THE SOUTH OF With the collaboration of specialists of different areas growth and a greater social equality, and made them THE WORLD and with the use of new technology and a novel and difficult. Enersis and its subsidiaries Endesa Chile and Chilectra, often unique iconography, a document is presented to In order to reinforce economic growth, with the and Fundación Endesa, have been carrying out the the public to make known aspects of daily life in our consequent care and respect for the environment, and Illuminating Monuments in the South of the World country in the 18th, 19th and 20th Centuries. social progress, it is necessary for better-prepared people program since 2000. Chile in Four Moments will become the principal work to enter the labor market, who can then generate even This projec t originated with the signing of an of the celebration of the bicentenary and be published more wealth for Chile. agreement with the Episcopal Conference of Chile in successively between the years 2008 and 2010. We therefore believe that a deficient education is October 2000, and renewed on two occasions, in 2004 In all, there will be 16 collectable fascicles of 72 pages a synonym for ill-prepared professionals and workers, and early 2007. On the last occasion, the commitment each which will make up by the end of the work, in June a situation that impac t s direc tly on the lack of of the Enersis Group was extended to 2011. 2010, a total of four volumes: 1710, 1810, 1910 and opportunities. Historical Iconography of Chile. ANNUAL REPORT SUSTAINABILITY 89 DONATION OF L IBRARIES MARINE BENTHONIC FAUNA OF THE CHILEAN Following studies carried out in 2007 for the strategic In collaboration with El Mercurio, Enersis has supported PATAGONIA definition, we proceeded to introduce the program in this campaign for promoting reading in remote With the publishing of the book “Marine Benthonic 2008, developed in two phases: Pilot Test (experimental communities far from urban centers since 2001, Fauna of the Chilean Patagonia”, Enersis and Fundación phase) and Mass Launch. contributing complete collections of books to more than San Ignacio del Huinay will offer to the local and global A reduced number of volunteers took part in the first 10 libraries in isolated areas. scientific community the first guide for the multi-taxa phase, selected at random from among the company’s During 2008, notable were the donations to the identification of Chile’s fjords region. various management areas. Later, in the Mass Launch Municipal Library of Pedro Mariño de Lobera, Coronel, The document included material collected over phase, 15% of the personnel registered who, with their in the Region of Biobío, and the Municipal Library of 10 years and a total of 9 expeditions, with close to collaboration and efforts, directly benefited a total of Paredones, in the 6th Region. 450 species. Of these organisms, close to 49 are new 180 children, from kindergarten to 8th grade, from The program has also benefited the villages of Cunco, specimens, particularly: Halopteris enersis, Tethocyathus the Miravalle school in the district of Peñalolén, and Cochamó, Puerto Natales, Santa Bárbara, Cochrane, endesa and Caryophyllia huinayensis. indirectly the whole student community and residents Easter Island, Taltal, Putre, Zúñiga, Hornopirén, Los Molles and Mincha. CORPORATE VOLUNTEERS of the area near the school. The Corporate Volunteers combine ac tions of community help with a program of complementary NATIVE TREES OF C HILE This program is oriented to cover the specific needs of infants teaching, through two projects (Raise Your Ideas This document, prepared by Enersis and Fundación the community in the area of education, offering at the and Development Activities) which have been specially San Ignacio del Huinay, describes in more than 190 same time a response to the curiosity of the company’s designed to meet the different needs and interests of the pages a total of 75 Chilean tree species. personnel: the possibility of combining their professional personnel. Both initiatives were implemented in 2008 Each has a brief description and detailed pictures (the and private lives through participating in a solidarity- through an alliance between Enersis and Corporación tree, bark, leaves, flowers and fruit), plus a map showing type project. Crearte, a charitable social organization specialized in their location by province. This book is undoubtedly The initiative was designed based on a model developing the human capital of boys and girls, helping becoming a unique object at the local level, considering of continuous improvement involving 3 stages: them become the protagonists of their development. the quality of the images, the description of each one strategic definition, implementation, and control and its format. and evaluation. 90 enersis08 ANNUAL REPORT INNOVATION NOVARE CLIMATE CHANGE IN LATIN AMERICA: IMPACT, SOCIETY MITIGATION AND F INANCING Enersis, in its constant concern for the effects of global CONTRIBUTIONS TO FOUNDATIONS AND WEL- In order to channel intellectual capital and creative warming, supported Endesa Latin America and CEPAL FARE INSTITUTIONS potential and generate a climate in which to encourage in the organization of the seminar “Climate Change in As an important member of society, Enersis supports innovation, Enersis consolidated Novare in 2008, a tool Latin America: Impact, Mitigation and Financing” whose various institutions and foundations carrying out local for managing the internal flow of ideas, offering Enersis purpose was the presentation of studies with respect welfare work, through sponsorships and donations. Group employees the opportunity to submit their ideas to the future evolution of emissions of greenhouse- During 2008, support was provided to Fundación that are susceptible to becoming innovation projects. effect gases and the opportunities for mitigation of Kast, Fundación Paz Ciudadana, Hogar de Cristo and In addition, Enersis, CAM, Synapsis and the Group’s climate change in Argentina, Brazil, Chile, Colombia Fundación Eduardo Frei, among others. distributors in Latin America can share knowledge and and Peru. These studies were sponsored by Endesa S.A. exchange experiences to reinforce the development of and carried out by distinguished academic and research SPONSORSHIPS R&D through Novare. entities including Universidad de Chile, Universidad de SEMINARS CHILE DAY Los Andes, Colombia, Universidad Católica del Perú and VELÁzQUEz IN THE WORKS OF BRU AND CIEN- Fundación Bariloche. FUEGOS 4TH INTERNATIONAL CONFERENCE FOR CHI- the exhibition “Velázquez in the works of Bru and The Enersis Groujp formed part of the sponsors for Enersis, as a member of AmCham Chile and its LEAN ISSUERS Cienfuegos”, which displayed a selection of 26 works Chilean Issuers Committee, organized and carried out For the fourth consecutive year, Enersis organized, as demonstrating the pictorial work of the outstanding local the celebration of Chile Day on the New York Stock a member of AmCham Chile and its Chilean Issuers artists, Roser Bru (born 1923) and Gonzalo Cienfuegos Exchange, NYSE. Committee, the 4th International Conference for Chilean (born 1949), all inspired by paintings of Diego Velázquez The purpose of the meeting was to discuss investment Issuers. (1599-1660), especially “Las Meninas”. alternatives in Chile and the strength of Chilean The meeting, which is one of the most technical companies that trade their shares on the American meetings on the subject of capital markets and debt 2ND CHRISTMAS CONCERT AT THE MILITARY market. issues in Chile, was attended by well-known economists, COLLEGE portfolio managers and executives of banks and The company was one of the sponsors of the ‘2nd investment funds, both local and international. Christmas Concert’, an event organized by the Military ANNUAL REPORT SUSTAINABILITY 91 Collage and took place in December in the institute’s SEMINARS AND R OUND TABLE PRIzES Court of Honor; this was attended by over 3,000 The company sponsored conferences organized by people. Estrategia newspaper in conjunction with the Central During 2008, the Enersis Group was recognized for Bank, in order to know the bank’s monetary policy its actions in various areas, in particular the following 3RD INTERNATIONAL EDUCATION CONGRESS reports. prizes: “READING-WRITING, STRATEGIES THAT W ORK” It also sponsored congresses of coaching, executives Enersis was one of the sponsors of the 3rd International of excellence and customer loyalty, and the Santiago TEN BEST COMPANIES FOR WORKING MOTHERS Education Congress “Reading-Writing, Strategies Anniversary Round Table. AND FATHERS that Work”, an event that brought together 1,000 The Enersis Group achieved an outstanding position teachers from the cities of Concepción, Santiago and MUNICIPALITY OF V ITACURA in the sixth edition of the ranking of the Ten Best Viña del Mar. Cultural activities organized by the municipality of Companies for Working Mothers and Fathers. The study, 9TH CYCLE OF R EGIONAL DEVELOPMENT For the fifth consecutive year, Enersis sponsored the RADIO BEETHOVEN Vitacura were sponsored. made by Fundación Chile Unido and Ya magazine of El Mercurio, distinguishes the companies that have policies that facilitate the conciliation of working life Cycle of Regional Development of the Diario Financiero, The company sponsors Radio Beethoven’s “Cultural with family life and in turn promote the adoption of whose object is to take to the regions the most notable Panorama”, program transmitted Monday to Saturday these practices. political, economic and financial representatives of Chile in a format of four daily micro-programs. and generate a debate with respect to national and ENDESA SPAIN’S CONTRIBUTION TO THE COM- zonal matters of interest that in turn improve the quality RADIO AGRICULTURA MUNITY of information for taking business decisions. The company sponsors the program ‘The Minute of During the 30-year anniversary celebrations of Estrategia 11 events were organized during 2008 with an Good Language’, a space conducted by Professor newspaper, Endesa S.A. received the distinction of average attendance of 130 people including opinion Mario Banderas, transmitted Monday to Friday with a Contribution to the Community due to the series of leaders, businessmen, politicians and academics. frequency of four daily spots. activities and programs the company organizes through its subsidiaries in Latin America. 92 enersis08 ANNUAL REPORT BEST INVESTOR RELATIONS TEAM IN C HILE of the ranking that covers a total de 50 non-financial initiative covering more than 150 facilities in 33 districts Enersis was praised as the Best Investor Relations companies in Argentina, Brazil, Chile, Colombia and of the company’s concession area. Around 80 thousand Team in Chile, after heading the Top 100 ranking in Mexico. The survey was prepared by the consultancy people use these facilities monthly to play sports and that category, as measured by Capital magazine and Management & Excellence and the business magazine carry out recreational and cultural activities. Santander Global Banking & Markets. LatinFinance. CIGRÉ PRIzE FOR I NNOVATION FIRST PLACE IN THE CATEGORY UTILITIES SEC- 12TH ANNUAL REPORTS COMPETITION At the 3rd Cigré Prize-Giving Dinner, Chilectra received TOR CORPORATE GOVERNANCE PRACTICES Enersis, Endesa Chile and Chilectra were recognized in a distinction in the Innovation category for its constant In the tenth edition of Investor Relations Global Rankings the category of Best Group Annual Report, according commitment with the development of a culture of (IRGR 2008), Enersis was placed first in the category to a study carried out by Gestión magazine and innovation, providing solutions that contribute to the Utilities Sector Corporate Governance Practices, and PricewaterhouseCoopers. benefit of its customers. also among the Top 5 in Latin America. The survey was carried out by MZ Consult in association with the TOP 10 IN 4 TH CSR R ANKING 2008 ACHS PRIzE FOR EFFECTIVE ACTION IN SAFETY companies sponsoring IRGR. Endesa Chile was placed in the Top Ten of the Corporate MATTERS BEST MANAGED COMPANY IN LATIN AMERICA IN annually by Fundación PROhumana, CPC and Capital Safety Association (ACHS) recognized Chilectra for its THE UTILITIES SECTOR magazine. constant and effective work in this area. Social Responsibility (CSR) ranking 2008, prepared At the annual Safety Prize Awards 2008, the Chilean Enersis was distinguished as the Best Managed Company in Latin America in the Utilities Sector, according to the LABOR SAFETY PRIzE BEST SOCIAL MANAGEMENT REPORT magazine Euromoney. The company obtained the highest A distinction for efforts in occupational safety and risk Chilectra’s Sustainability Report 2007 won the distinction score (11.86%) in the utilities segment. prevention was awarded by the National Safety Council of the Best Social Management Report according to a THE BEST GOVERNED MAJOR L ATIN CORPORA- version of the Annual National Safety Competition. RSE, within the framework of prizes for the best TIONS 2008 sustainability reports. (CNS) to Endesa Chile, within the framework of the 46th study made for the second consecutive year by Acción Enersis and its subsidiary Endesa Chile obtained an AMCHAM PRIzE FOR G OOD CORPORATE CITIzEN outstanding position in The Best Governed Major Chilectra received this recognition from AmCham Chile Latin Corporations 2008, being among the Top 10 for its Multi-Use Playing Fields Lighting program, an ANNUAL REPORT SUSTAINABILITY 93 03. HUMAN RESOURCES LABOR CLIMATE The training programs totaled 15,450 hours of training, an average of 74 hours per employee and distributed as follows: 11% training for management, 52% for professionals and 37% for staff. Towards the end of 2007, a working environment survey was carried out in all the Enersis Group companies, the OTHER ACTIVITIES results of which were announced in the first quarter of 2008. This survey enabled to measure the perception of During the year Enersis carried out several activities each employee in terms of Environment, Commitment focused on the wellbeing and satisfaction of its and Corporate Culture and establish action lines in personnel and their families. Some of the main activities those areas requiring improvement. 98% of workers were: at Enersis took part voluntarily in the survey and the • Dance workshops, sports schools, physical training level of satisfaction obtained, measures through Work programs and painting workshops. Satisfaction and Motivation, was 81%. Recreational programs and summer camps for employees’ children held during summer and winter TRAINING vacations. • Prizes awarded for academic excellence to employees’ Training activities were oriented to the development children at tending junior, middle and senior of the necessary professional and technical skills for schools. reaching and maintaining the efficiency levels. In • Training activities for spouses and children of addition to training programs in subjects like computer personnel, focused on information technology and use, languages, human resources and management computer skills. formation, training was also given this year in economic • Organization of the Olympics, a bi-annual event in and financial subjects, especially in training programs in which all employees of the Enersis Group in Chile International Financial Reporting Standards specifically take part. for the company. These programs took up 32% of the • Corporate Volunteers Program for employees. year’s training time. • Second internal photographic competition. A Leadership Development Program was also designed for all company heads. 94 enersis08 ANNUAL REPORT IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES ANNUAL REPORT IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES 95 AGRÍCOLA DE CAMEROS Subscribed & paid capital (ThCh$) 37,029,390 Name Sociedad Agrícola de Cameros Limitada Kind of company Limited partnership. Tax No. 77,047,280-6 Address Camino Polpaico a Til-Til, S/N Til-Til Telephone (56 2) 378 4700 Subscribed & paid capital (ThCh$) 5,738,046 Objects The exploitation of agricultural land. Business Real estate. Principal executive Hugo Ayala Espinoza Holding of Enersis (direct & indirect) 57.50% - Unchanged. AGRÍCOLA E INMOBILIARIA PASTOS VERDES Name Agrícola e Inmobiliaria Pastos Verdes Limitada Kind of company Limited partnership. Tax No. 78,970,360-4 Address Américo Vespucio 100, Pudahuel, Santiago, Chile Telephone (56 2) 601 0601 Objects T h e e x p l o i t a t i o n o f a g r i c u l t u r a l land and all k inds of real - es t ate activities, including the urbanization, commercialization and disposal of land in any legal form. Business Real estate. Principal executive Bernardo Küpfer Matte Holding of Enersis (direct & indirect) 55.00% - Unchanged. AGUAS SANTIAGO PONIENTE Name Aguas Santiago Poniente S.A. Kind of company Closely-held corporation, subject to the regulations for open corporations Tax No. 96,773,290-7 Address Américo Vespucio 100, Pudahuel, Santiago, Chile Telephone (56 2) 601 0601 Subscribed & paid capital (ThCh$) 6,601,121 Objects Exclusively to establish, construct and exploit public utilities for producing and distributing water; collect, treat and dispose of sewage, and carr y out the other func tions expressly authorized by Law 382 of 1988 and its amendments. Business Water and related services. Board of directors Víctor M. Jarpa Riveros Cristóbal Sánchez Romero Andrés Salas Estrades Luis F. Edwards Mery José M. Guzmán Nieto Principales ejecutivos Jorge Alé Yarad Shareholding of Enersis (direct & indirect) 55.00% - Unchanged. AMPLA ENERGÍA Name Ampla Energia e Serviços S.A. Kind of company Open corporation Address Praç a Le oni Ramos, N° 01 – S ão Domingos, Niteroi, Río de Janeiro, Brazil Ramiro Alfonsín Balza (Chief Regional Planning & Control Officer, Enersis) Ramón Castañeda Ponce Luiz Felipe Lampreia Alternate director Marcos da Silva Crespo of any kind to holders of concessions, permits or authorizations of electricity ser vices and their customers and participate as shareholder in other energy sector companies. Principal executives Cristián E. Fierro Montes José Alves de Mello Franco Luciano A. Galasso Samaria Carlos E. Naegele Moreira Claudio Rivera Moya Luiz Carlos Bettencout Déborah M. Rosa Brasil Albino Motta da Cruz André Moragas da Costa Aurelio R. Bustilho de Oliveira Commercial relations Structured loans Shareholding of Enersis (direct & indirect) 69.88% - Unchanged Business Investments. Board of directors Mário F. de Melo Santos Antonio B. Pires e Abuquerque Ramiro Alfonsín Balza (Chief Regional Planning & Control Officer, Enersis) Cristóbal Sánchez Romero Marcelo Llévenes Rebolledo Rafael López Rueda Nelson Ribas Visconti Luiz Felipe Lampreia José Alves de Mello Franco Principal executives Cristián E. Fierro Montes Luiz Carlos Bettencourt José Alves de Mello Franco Telephone (55 21) 2613 7000 Proportion of Enersis’s assets 2.26% Subscribed & paid capital (ThCh$) 34,368,644 Subscribed & paid capital (ThCh$) 252,235,588 Objects S t u d y, p l a n , p r o j e c t , c o n s t r u c t and explore electricity production, t r a n s m i s s i o n , t r a n s f o r m a t i o n , distribution and sale systems, and provide related services that have been or may be conceded; carry out research in the energy sector and participate as a shareholder in other companies in the energy sector. AMPLA INVESTIMENTOS Name Ampla Investimentos e Serviços S.A. Type of company Open corporation Address Praça Leoni Ramos, N° 01 – parte São Domingos, Niterói, Río de Janeiro, Brazil Business Distribution of electricity. Telephone (55 21) 2613 7071 Board of directors Mario F. de Melo Santos Antonio B. Pires e Abuquerque Nelson Ribas Visconti Eduardo dos Santos Machado Cristóbal Sánchez Romero José Alves de Mello Franco Objects S t u d y, p l a n , p r o j e c t , c o n s t r u c t and explore electricity production, t r a n s m i s s i o n , t r a n s f o r m a t i o n , distribution and sale systems, and provide related services that have been or may be conceded; provide services Shareholding of Enersis (direct & indirect) 69.88% - Unchanged. Proportion of Enersis’s assets 0.22% ARA - INGENDESA Name Consorcio Ara - Ingendesa Ltda. Type of company Limited partnership Tax No. 77,625,850-4 Address Santa Rosa 76, piso 10, Santiago, Chile Telephone (562) 630 9000 96 enersis08 ANNUAL REPORT Subscribe & paid capital (ThCh$) 1,000 Objects Provision of engineering ser vices, including the projection, planning and per forming of engineering studies and projects, advice and consultancy, provision of assistance and technical a n d m a n a g e m e n t i n f o r m a t i o n , inspection and development of projects and works. Business Engineering services. Representatives Rodrigo Alcaíno Mardones Alejandro Santolaya de Pablo Alternate representatives Fernando Orellana Welch Julio Montero Montegú Elías Arce Cyr Cristián Araneda Valdivieso Holding of Enersis (direct & indirect) 29.99%- Unchanged. per forming of engineering studies and projects, advice and consultancy, provision of assistance and technical a n d m a n a g e m e n t i n f o r m a t i o n , inspection and development of projects and works. Business Engineering services. Representatives Rodrigo Alcaíno Mardones Alejandro Santolaya de Pablo Ernesto Ferrandiz Doménech Alternate representatives Cristián Araneda Valdivieso Elías Arce Cyr Julio Montero Montegú Fernando Orellana Welch Joaquín Botella Malagón Angel Ares Montes Holding of Enersis (direct & indirect) 19.99% - Unchanged. Business Financial services. Board of directors Manuel Irarrázaval Aldunate Daniel Bortnik Ricardo Rodríguez Horacio Reyser Shareholding of Enersis (direct & indirect) 29.99% - unchanged José Ignacio Pires Medeiros Carlos Ewandro Moreira Eugenio Cabanes Durán Luiz Carlos Bettencourt José Alves de Mello Franco Ana Claudia Gonçalves Rebello Aurélio Ricardo de Oliveira Nelson Ribas Visconti Shareholding of Enersis (direct & indirect) 53.36% - Unchanged. CACHOEIRA DOURADA CAM Name Centrais Elétricas Cachoeira Dourada S.A.- CDSA Name Compañía Americana de Multiservicios Ltda. Type of company Closely-held corporation Type of company Limited partnership Address Rodovia GO 206, Km 0, Cachoeira Dourada Goiania, Goiás, Brazil Tax No. 96,543,670-7 ATACAMA FINANCE Telephone (55 62) 3434 9000 ARA INGENDESA SENER Name Consorcio Ara - Ingendesa - Sener Ltda. Name Atacama Finance Co. Type of company Exempt company Subscribed & paid capital (ThCh$) 164,950,142 Objects Studies, projections, construction, installation, operation and exploration of electricity generating plants, plus the related commercial activity. Promote or par ticipate in other companies constituted to produce electricity, in or outside the state of Goiás, by the subscription for any number of shares or quotas. Address Caledonian House P.O. Box 265 G, George Town, Grand Cayman, Cayman Islands Telephone (562) 630 9000 Subscribed & paid capital (ThCh$) 4,009,635 Business Electricity generation. Objects Borrowing of money in the financial market through loans of the issue of bonds or other instruments, and loans of money to other companies, p ar tic ular l y t ho s e relate d to t he Atacama project. Board of directors Guilherme Gomes Lencastre Manuel Herrera Vargas Marcelo Llévenes Rebolledo Principal executives Guilherme Gomes Lencastre Manuel Herrera Vargas Type of company Limited partnership Tax No. 76,738,990-6 Address Santa Rosa 76, piso 10, Santiago, Chile Telephone (562) 630 9000 Subscribed & paid capital (ThCh$) 1,000 Objects Provision of engineering ser vices, including the projection, planning and Address Tarapacá 934, Santiago, Chile Telephone (56 2) 389 7300 Subscribed & paid capital (ThCh$) 2,572,038 Objects Provide for its own or third party’s account &/or associated with other parties, in Chile or abroad, services in general, real estate and construction of real estate, impor t, expor t and distribute products of any kind. Business General services. Representatives Cristóbal Sánchez Romero Klaus Winkler Speringer Alternate representatives Gonzalo Mardones Pantoja Eduardo López Miller Principal executives Klaus Winkler Speringer Gonzalo Mardones Pantoja Omar Aramayo James Pedro Carrizo Polanco Alfredo Herrera Carrasco Tomás Casanegra Rivera Ricardo Camezzana Leo Carlos A. Zarruk Gómez Pablo Calderón Pacheco Alejandro Cabrera Croqueville Commercial relations Civil works management services and supply of financial administration, management, corporate and general services. Trading current account. Holding of Enersis (direct & indirect) 100% - Unchanged. Proportion of Enersis’s assets 1.02% CAM ARGENTINA Name Compañía Americana de Multiservicios (CAM) S.R.L. Type of company Limited partnership Address Avda. Vélez Sarsfield 1160, Capital Federal, Argentina Telephone (54 11) 4302 2951/58 Subscribed & paid capital (ThCh$) 636,450 Objects The provision of professional and technical ser vices to national and international companies and organisms, public and private, advice, technical assistance, assembly, process control, start-up and maintenance of systems, machinery and apparatus, maintenance of transport and distribution net works, all related to the production, transport and distribution of electricity. ANNUAL REPORT IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES 97 Business General services. Principal executive Pablo Calderón Pacheco Holding of Enersis (direct & indirect) 100% - Unchanged. CAM BRASIL Name Cam Brasil Multiserviços Ltda. Type of company Limited partnership Address Avda. José Mendonça de Campos, 680 São Gonçalo – RJ, Brazil Telephone (55 21) 2702 8000 Subscribed & paid capital (ThCh$) 4,049,388 Objects Provision of electricity engineering services, construction of networks and large works, mass commercial activities in utilities. Business General services. Principal executive Tomás Casanegra Rivera Holding of Enersis (direct & indirect) 100% - Unchanged. CAM COLOMBIA Name Compañía Americana de Multiservicios Ltda. Colombia Type of company Limited partnership Address Avda. Carrera 68 N° 5-21, Bogotá, Colombia Address Jr. Teniente César López Rojas 201, piso 3, Maranga, San Miguel, Lima, Peru Tax No. 76,003,204-3 Telephone (57 1) 417 3000 Telephone (51 1) 561 1604 Address Santa Rosa 76, piso 12, Santiago, Chile Subscribed & paid capital (ThCh$) 494,522 Subscribed & paid capital (ThCh$) 995,250 Telephone (562) 630 9000 Objects Provide for its own or third party’s account &/or associated with other parties, in Colombia or abroad, the following activities: a) services: the provision of professional and technical services to national and international companies and organisms, public and private; b) construction and real estate, through the construction and renovation of all kinds of properties and carrying out projects; c) import and export of all kinds of materials; d) trading, through the purchase, sale, barter, fractioning, consignment and distribution of all kinds of materials; e) industrial, through the production, assembly or manufacture in any of their stages of all kinds of materials or machiner y ; f ) design, creation, ex ploitation and s ale of ser vices and information and communication technology (hardware &/or software); g) investments through participation in other companies. Objects Carry out for its own or third party’s account professional and technical s er v ices in the management and purchase of materials or equipment for services including those related t o e l e c t r i c i t y , w a t e r , g a s a n d communications; the administration of warehouses and materials, control and performing of works, metering and calibration, advice, technical assistance, assembly, process control, start up and maintenance of systems, machinery and apparatus, maintenance of transport and distribution networks; all related to the production, transport a n d d i s t r i b u t i o n o f w a t e r, g a s , telecommunications and energy in any of its forms. Construction and real estate: construction and renovation of all kinds of properties and the carrying out of all kinds of property management and project execution, direction and carrying out of engineering and /or architectural works in general. Subscribed & paid capital (ThCh$) 12,284,743 Objects Promote and develop renewable energy projec ts, principally wind energy, identify and develop clean development mechanism (CDM) projects and act as depository and trader in emission reduc tion cer tif icates originating from these projects. The generation, transport, distribution, supply and sale of electricity, for which it may acquire and exploit the respective concessions and grants. Business Wind energy generation. Board of directors Juan Benabarre Benaiges Claudio Iglesis Guillard Rodrigo Alcaíno Mardones Sebastián Fernández Cox Cristóbal García-Huidobro Ramírez Business General services. Business General services. Principal executives Carlos Alberto Zarruk Gómez Principal executive Ricardo Camezzana Leo Holding of Enersis (direct & indirect) 100% - Unchanged. CAM PERÚ Name Compañía Americana de Multiservicios del Perú S.R.L. Type of company Limited partnership Holding of Enersis (direct & indirect) 100% - Unchanged. CANELA Name Central Eólica Canela S.A. Type of company Closely-held corporation Alternate directors Aníbal Bascuñan Bascuñan Alan Fisher Hill Julio Montero Montegú Claudio Betti Pruzo Juan Cristóbal Pavéz Recart Principal executive Wilfredo Jara Tirapegui Shareholding of Enersis (direct & indirect) 44.98% - Unchanged. CELTA Name Compañía Eléctrica Tarapacá S.A. Type of company Closely-held corporation Tax No. 96,770,940-9 Address Santa Rosa 76, Santiago, Chile Telephone (562) 630 9000 Subscribed & paid capital (ThCh$) 103,099,643 Objects Principally the production, transport, distribution and supply of electricity, in Chile and internationally, for which it may obtain, acquire and exploit the respective concessions and grants. Its priority object until its conclusion is to construct a thermal generating plant and moorings or port facilities for the loading and unloading of inputs and other products in the sector called Punta de Patache, to the south of Iquique in Chile’s 1st Region. It also inc lu d e s t h e c o ns t r uc t io n o f t h e transmission line with its substations b et we en the plant and the D oña I n é s d e Co l l a h u a s i c o p p e r m i n e and reinforcement of the Northern Electricity Grid. Business Energy generation. Board of directors Chairman Alejandro García Chacón Directors Alan Fischer Hill Liones Roa Burgos Principal executive Eduardo Soto Trincado Shareholding of Enersis (direct & indirect) 59.98%- Unchanged. 98 enersis08 ANNUAL REPORT CEMSA Name Endesa Cemsa S.A. Type of company Corporation Address Pasaje Ing. E. But t y 220, piso 16, Buenos Aires, Argentina. Telephone (5411) 4875 0600 Subscribed & paid capital (ThCh$) 7,020,284 Objects For its own and /or for the account and on behalf of third parties and / or associated with other par ties, the wholesale purchase and sale or electricity power and energy produced and /or consumed by third parties, including but not limited to the import and export of electricity power and energy and the commercialization of royalties, and the provision and /or performing of services related to the above activity, all in accordance with prevailing regulations. Business Energy trading. Board of directors José María Hidalgo Martín-Mateos José Venegas Maluenda Fernando Antognazza Alternate directors Roberto José Fagan Arturo Plácido Miguel Pappalardo Pedro Cruz Viné Principal executive Juan Carlos Blanco Shareholding of Enersis (direct & indirect) 26.99% - Unchanged. CENTRALES HIDROELÉCTRICAS DE AYSÉN S.A. Name Centrales Hidroeléctricas de Aysén S.A. Type of company Closely-held corporation Tax No. 76,652,400-1 Address Miraflores 383, Of. 1302, Santiago, Chile Telephone (562) 713 5000 Subscribed & paid capital (ThCh$) 72,916,665 Objects The development, financing, ownership and exploitation of a hydroelectric project in the 11th Region of Aysén, which contemplates an estimated capacit y of 2,355 MW distributed between five hydroelectric plants, which is called the “Aysén Project”. The following activities form part of its objects: a) the production and transport of electricity; b) the supply and sale of electricity to its shareholders; c) the administration, operation and maintenance of hydraulic work s, electrical systems and hydroelectric generating plants; d) the provision of services related to its objects. The above activities may be carried out for its own or third party’s account. The company may obtain, acquire and exploit the required concessions and permits for this purpose. Business Energy generation (project). Board of directors Antonio Albarrán Ruiz-Clavijo Rafael Mateo Alcalá Juan Benabarre Benaiges Rodrigo Alcaíno Mardones Bernardo Larraín Matte Luis Felipe Gazitúa Achondo Alternate directors Carlos Martín Vergara Claudio Iglesis Guillard Eduardo Morel Montes Carlos Urenda Aldunate Sebastián Fernández Cox Cristián Morales Jaureguiberry Principal executive Hernán Salazar Zencovich Shareholding of Enersis (direct & indirect) 30.59% - Unchanged. CHILECTRA Name Chilectra S.A. Type of company Open corporation Tax No. 96,800,570-7 Address Santa Rosa 76, piso 8, Santiago, Chile Telephone (56 2) 675 2000 Subscribed & paid capital (ThCh$) 367,928,682 Objects E x p l o i t i n C h i l e o r a b r o a d t h e distribution and sale of hydraulic, thermal, heat or any kind of electricity, and the distribution, transport and sale of fuels of any kind, supplying this energy or fuel to most consumers directly or through other companies. Board of directors Jorge Rosenblut Ratinoff José María Calvo-Sotelo Pedro Buttazzoni Álvarez Hernán F. Errázuriz Correa Marcelo Llévenes Rebolledo Paolo Bondi Macarena Carrión López Principal ejecutives Rafael López Rueda Juan Pablo Larraín Medina Gonzalo Vial Vial Cristóbal Sánchez Romero Guillermo Pérez del Río Andreas Gebhardt Strobel Enrique Fernández Pérez Ramón Castañeda Ponce Subscribed & paid capital (ThCh$) 390,008,060 Objects Exploit abroad for its own or through third parties the distribution and sale of electricity. It may make investments in foreign companies and make all kinds of investments in all kinds of mercantile instruments like bonds, d e b e n t u re s , d e b t t i t l e s , c re d i t s , negotiable securities or other financial or commercial documents, all with a view to their natural and civil returns. It may constitute, amend, dissolve and liquidate foreign companies and develop all other activities that are complementary and/or related to the above business. Commercial relations Structured loans; rentals of transmission and substation lines; provision of risk-prevention services; legal and p r o f e s s i o n a l a d v i c e i n b u s i n e s s a d minis t ratio n an d en gine er in g , financial management in general, corporate and others. Shareholding of Enersis (direct & indirect) 99.09% - Unchanged. Proportion Enersis’s assets 25.98% Business Investments. Board of directors Cristóbal Sánchez Romero Ramón Castañeda Ponce Ricardo Mebus Pumpin Principal executives Ricardo Mebus Pumpin Shareholding of Enersis (direct & indirect) 99.09% - Unchanged. CHILECTRA INVERSUD CHOCÓN Name Chilectra Inversud S.A. Name Hidroeléctrica El Chocón S.A. Tax No. 99.573.910-0 Type of company Closely-held corporation Type of company Corporation Address Avda. España 3301, Buenos Aires, Argentina Address Santa Rosa 76, piso 8, Santiago, Chile Paid capital (ThCh$) 216,258,846 Business Energy distribution. Telephone (56 2) 675 2000 Objects Production of electricity and its block commercialization. ANNUAL REPORT IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES 99 Business Energy generation. electricity, including import and export activities. Business Energy distribution. Telephone (55 85) 3453-4082 COMPAÑÍA PERUANA DE ELECTRICIDAD Board of directors Rafael Mateo Alcalá José Miguel Granged Bruñen Carlos Martín Vergara Miguel Ortiz Fuentes Julio Valbuena Sánchez Alex Valdez Julio Anguita Orlando Díaz Alternate directors Fernando Antognazza Francisco Domingo Monteleone José María Hidalgo Martín-Mateos Manuel Irarrázaval Aldunate Juan Carlos Blanco Héctor Osvaldo Mendiberri Juan Carlos Nayar Enrique Díaz Principal executive Fernando Claudio Antognazza Shareholding of Enersis (direct & indirect) 39.21% - Unchanged. CIEN Name Compañía de Interconexión Energética S.A. Type of company Corporation Address Praça Leoni Ramos, N° 1, piso 6, Bloco 2, São Domingos, Niterói, Río de Janeiro, Brazil Business Energy transmission. Board of directors Marcelo Andrés Llévenes Rebolledo José Augustín Venegas Maluenda Principal executives Guilherme Gomes Lencastre Aurelio Ricardo Bustillo de Oliveira Luiz Carlos Ortins de Bettencourt José Ignácio Pires Medeiros Manuel Rigoberto Herrera Vargas Carlos Ewandro Naegale Moreira Ana Claudia Gonçalves Rebello José Alves de Mello Franco Eugenio Cabanes Durán Nelson Ribas Visconti Shareholding of Enersis (direct & indirect) 53.57% - Unchanged. CODENSA Name Codensa S.A. E.S.P. Type of company Corporation Address Carrera 13 A 93-66, Bogotá, Colombia Telephone (57 1) 601 6060 Board of directors José Antonio Vargas Lleras Andrés Regué Godall Orlando Cabrales Martínez Lucio Rubio Díaz Astrid Martínez Ortiz Juan Carlos Ortega Lopez Carlos Bello Vargas Alternate directors David Felipe Acosta Roberto Ospina Pulido Antonio Sedán Murra Cristián Herrera Fernández Henry Navarro Sánchez Héctor Zambrano Rodríguez Consuelo Beltrán Yazmit Secretario del Directorio Andrés Caldas Rico Principal executives Cristián Herrera Fernández David Acosta Correa Cristal Otárola Restrepo Alba Urrea Gómez Margarita Olano Olano Luis Larumbe Aragón Álvaro Camacho Borrero Roberto Ospina Pulido Carlos De La Espriella Omar Serrano Rueda Shareholding of Enersis (direct & indirect) 21.81% (+0.8% change). Proportion of Enersis’s assets 1.84% Subscribed and paid capital (ThCh$) 495,005,355 COELCE Telephone (55 21) 3607 9500 Paid capital (ThCh$) 123,874,173 Objects The produc tion, industrialization, distribution and commercialization of Objects Distribution and sale of electricity and the performing of all connected, complementary and related activities to the distribution and sale of electricity, carrying out of works, designs and consultancy in electrical engineering and the sale of products to the benefit of its customers. Name Companhia Energética do Ceará Type of company Foreign open corporation Address Rua Padre Valdevino, 150 - Centro, Fortaleza, Ceará, Brazil Subscribed & paid capital (ThCh$) 238,219,177 Objects The distribution of elec tricit y and related services in the state of Ceará. Name Compañía Peruana de Electricidad S.A.C. Type of company Closely-held corporation Business Energy distribution. Board of directors Mario Fdo. de Melo Santos Marcelo Llévenes Rebolledo Cristóbal Sánchez Romero Gonzalo Vial Vial José Alves de Mello Franco Aurélio Bustilho de Oliveira Jorge Parente Frota Júnior Fernando de Moura Avelino Cristián Fierro Montes Roberto de Paula Macieira Antônio Pires e Albuquerque Luciano A. Galasso Samaria Nelson Ribas Visconti Teobaldo José Cavalcanti Leal José Alencar Araripe Júnior Vladia Viana Regis José Renato Ferreira Barreto José Nunes de Almeida Neto Juarez Ferreira de Paula José Távora Batista Luiz Carlos Bettencourt Principal executives Abel Alves Rochinha José Nunes de Almeida Neto Olga Jovanna Carranza Salazar José Távora Batista Aurélio Bustilho de Oliveira José Renato Ferreira Barreto Luiz Carlos Bettencourt José Alves de Mello Franco Silvia Cunha Saraiva Pereira Shareholding of Enersis (direct & indirect) 34.90% - Unchanged. Address Jr. Teniente César López Rojas 201, Maranga, San Miguel, Lima, Peru Telephone (511) 561 1604 Subscribed & paid capital (ThCh$) 15,081,231 Objects Make investments in general, especially those related to the distribution and generation of electricity. Business Energy distribution. Principal executive Ignacio Blanco Fernández Shareholding of Enersis (direct & indirect) 50.54% - Unchanged. Proportion of Enersis’s assets 0.00% CONSTRUCCIONES Y PROYECTOS LOS MAITENES Name Construcciones y Proyectos Los Maitenes S.A. Type of company Closely-held corporation Tax No. 96,764,840-K 100 enersis08 ANNUAL REPORT Address Américo Vespucio 100, Pudahuel, Santiago, Chile Telephone (56 2) 601 0601 Address Avda. España 3301, Buenos Aires, Argentina Telephone (5411) 4307 3040 Type of company Corporation Address Bartolomé Mitre 797, piso 13, Buenos Aires, Argentina Subscribed & paid capital (ThCh$) 4,712,875 Paid capital (ThCh$) 103,105,536 Subscribed & paid capital (ThCh$) 10,059,230 Objects a) The construction for own or third par ties’ account, on own or other land, urbanized or not, of all kinds of civil works, installations, buildings, housing, offices and others; b) the sale or disposal in any form of such building works; c) the study and development of projects for such buildings, including engineering, architecture, financing, commercialization, etc. For this, it may act for its own or third party’s account, either directly or forming part of associations, communities, companies and legal entities of any kind, in which it may also assume the management. Business Real estate. Board of directors Cristóbal Sánchez Romero Victor Jarpa Riveros Andrés Salas Estrades Luis Felipe Edwards Mery José Manuel Guzmán Nieto Principal executive Bernardo Küpfer Matte Shareholding of Enersis (direct & indirect) 55.00% - Unchanged. COSTANERA Name Endesa Costanera S.A. Type of company Corporation Objects The production of electricity and its block sale. Business Energy generation. Board of directors Rafael Mateo Alcalá Máximo Bomchil Julio Valbuena Sánchez César F. Amuchástegui José María Hidalgo Martín-Mateos Miguel Ortiz Fuentes Manuel Irarrázaval Aldunate Eduardo J. Romero Directores suplentes Carlos Martín Vergara Francisco Monteleone Fernando C. Antognazza Jorge Burlando Bonino Roberto Fagan Sergio Schmois Bernardo Iriberri Alfredo Mauricio Vítolo Principal executives José Miguel Granged Bruñen Fernando Carlos Luis Boggini Rodolfo Silvio Bettinsoli Jorge Burlando Sergio Schmois Francisco Monteleone Shareholding of Enersis (direct & indirect) 41.85% - Unchanged. CTM Name C o m p a ñ í a d e T r a n s m i s i ó n d e l Mercosur S.A. Objects P r o v i d e h i g h - t e n s i o n e l e c t r i c i t y transmission services both in relation to national and international electricity systems, in accordance with current legislation, for which it may participate in national or international tenders, become a public-utilit y elec tricit y concession-holder in high tension nationally or internationally and carry out all activities necessary for meeting its objects, including expressly but not limited to becoming party to contracts for the construction, operation and maintenance for the star t and / or expansion of electricity transmission lines, participate in the financing of projects related directly or indirectly with those enterprises as lender and/ or borrower and/or guarantor in favor of third parties. Business Energy transmission. Board of directors José María Hidalgo Martín-Mateos Guilherme Lencastre Arturo Miguel Pappalardo Alternate directors Juan Carlos Blanco Roberto José Fagan José Venegas Maluenda Principal executive Francisco J. Bugallo Sánchez Shareholding of Enersis (direct & indirect) 53.56% - Unchanged. DISTRILEC INVERSORA Name Distrilec Inversora S.A. Type of company Foreign closely-held corporation Address San José 140 (C1076AAD) Buenos Aires, Argentina Telephone (54 11) 4370 3700 Subscribed & paid capital (ThCh$) 323,001,957 Objects Exclusively to invest in companies constituted or to be constituted whose principal activity is the distribution of electricity or that directly or indirectly participate in companies with that principal business through all kinds of financial and investment activities, except those in the laws of financial entities, the purchase and sale of public and private debt paper, bonds, shares, negotiable instruments and the granting of loans, and the placement of its funds in bank deposits of any kind. Business Investments. Board of directors Claudio Fontes Nunes Rafael López Rueda Ramiro Alfonsín Balza (Chief Regional Planning & Control Officer, Enersis) Daniel Casal Santiago Daireaux Fermín Demonte María Inés Justo Gabriel Marchione Rigoberto Mejía Aravena Gonzalo Vial Vial Directores suplentes Pedro Eugenio Aramburu Manuel María Benites Esteban Diez Peña Mónica Diskin Roberto José Fagan Martín Mandarano Jean Yatim Morillas Enrique Rosello Jorge Vugdelija Principal executive José María Hidalgo Martín-Mateos Shareholding of Enersis (direct & indirect) 50.93% - Unchanged. Proportion of Enersis’s assets 2.04% EDEGEL Name Edegel S.A.A. Type of company Open corporation Address A v d a . V í c t o r A n d r é s B e l a ú n d e 147, edificio real 4, piso 7, Centro Empresarial Camino Real, San Isidro, Lima, Peru Paid capital (ThCh$) 540,044,533 Objects Principally, and in general, electricity generation activities, also the acts and civil, industrial, commercial and any operations relating or leading to the principal objects. Business Energy generation. Board of directors Rafael Mateo Alcalá Juan Benabarre Benaiges Giora Almogy Reynaldo Llosa Barber Ricardo Harten Costa Alfonso Bustamante Canny Alberto Triulzi Mora Directores suplentes ANNUAL REPORT IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES 101 Julián Cabello Yong Arrate Gorostidi Aguirresarobe Francisco García Calderón Roberto Cornejo Spickernagel Jaime Zavala Costa Milagros Noriega Cerna Rosa M. Flores-Aráoz Cedrón Principal executives Carlos Luna Cabrera Christian Schroder Romero Milagros Noriega Cerna Julián Cabello Yong Rosa M. Flores-Aráoz Cedrón Shareholding of Enersis (direct & indirect) 19.83% - Unchanged EDELNOR Name Empresa de Distribución Eléctrica de Lima Norte S.A.A. Type of company Foreign open corporation Gonzalo Carbó De Haya Principal executives Ignacio Blanco Fernández Carlos Solís Pino Walter Sciutto Brattoli Rocío Pachas Soto Teobaldo Leal Cavalcante Luis Salem Hone Pamela Gutiérrez Damiani Alfonso Valle Cisneros Shareholding of Enersis (direct & indirect) 33.54% - Unchanged EDESUR Name Empresa Distribuidora Sur S.A. Type of company Foreign corporation Address San José 140 (1076), Capital Federal, Argentina Address Jr. Teniente Cesar López Rojas 201 Urb. Maranga, San Miguel, Lima, Peru Telephone (54 11) 4370 3700 Telephone (51 1) 561 2001 Subscribed & paid capital (ThCh$) 60,324,359 Subscribed & paid capital (ThCh$) 588,278,979 Objects Distribution and commercialization of electricity and related operations. Objects The provision of electricity distribution, transmission and generation services. Business Energy distribution. Business Energy distribution Board of directors Reynaldo Llosa Baber Ignacio Blanco Fernández Ramiro Alfonsín Balza (Chief Regional Planning & Control Officer, Enersis) Ricardo Vega Llona Rafael López Rueda Alfredo Ferrero Diez Canseco Róger Espinosa Reyes Board of directors Rafael López Rueda Claudio Fontes Nunes Ramiro Alfonsín Balza (Chief Regional Planning & Control Officer, Enersis) Rafael Arias Salgado Miguel Beruto Juan Pablo Larraín Medina Rigoberto Mejía Aravena Marcelo Silva Iribarne Gonzalo Vial Vial Directores suplentes Santiago Daireaux Manuel Benites Roberto Fagan Daniel Casal Pablo Martín Lepiane Alan Arntsen Pedro Eugenio Aramburu María Inés Justo Principal executives José María Hidalgo Martín-Mateos Álvaro Estivariz Héctor Ruiz Moreno Sandro Rollan Daniel Colombo Daniel Alasia Juan Garade Juan Verbitsky José María Gottig Daniel Martini Jorge Lukaszczuk Shareholding of Enersis (direct & indirect) 65.39% - Unchanged Proportion of Enersis’s assets 2.13% ELECTROGAS Name Electrogas S.A. Type of company Closely-held corporation Tax No. 96,806,130-5 Address Evar is to L illo 78 , pis o 4, O f. 41, Santiago, Chile Telephone (562) 321 7737 Business Transport of gas. Subscribed & paid capital (ThCh$) 13,534,844 Board of directors Felipe Aldunate Hederra Claudio Iglesis Guillard Pedro Gatica Kerr Enrique Donoso Moscoso Rosa Herrera Martínez Alternate directors Sergio Arévalo Espinoza Jorge Bernardo Larraín Matte Ricardo Santibáñez Zamora Gastón Cáceres Videla Principal executive Carlos Andreani Luco Shareholding of Enersis (direct & indirect) 25.49% - Unchanged. EMGESA Name Emgesa S.A. E.S.P. Type of company Public utility corporation Address Carrera 11 82-76, piso 4, Santa Fe de Bogotá, D.C. Colombia Paid capital (ThCh$) 926,926,416 Objects The generation and sale of electricity and the per forming of all similar, connected, complementary and related activities. Objects The provision of transport services for natural gas and other fuels, for its own or third party’s account, for which it may construct, operate and maintain gas, oil and multi-use pipelines and complementary installations. Business Energy generation. Board of directors José A. Vargas LLeras Astrid Martínez Ortiz Lucio Rubio Díaz Luisa Fernanda Lafourie Sebastián Fernández Cox Juan Ricardo Ortega José Iván Velásquez Alternate directors Fernando Gutiérrez Medina Gustavo Gómez Cerón Henry Navarro Sánchez Manuel Jiménez Castillo José Venegas Maluenda Oscar Alberto Molina García Principal executives Lucio Rubio Díaz Andrés Caldas Rico Juan Manuel Pardo Javier Blanco Fernández Gustavo Gómez Cerón Fernando Gutiérrez Medina María Celina Restrepo Shareholding of Enersis (direct & indirect) 16.12%- Unchanged EMPRESA ELÉCTRICA DE COLINA Name Empresa Eléctrica de Colina Ltda. Type of company Limited partnership Tax No. 96,783,910-8 Address Chacabuco 31, Colina, Santiago, Chile Telephone (56 2) 844 4280 Subscribed & paid capital (ThCh$) 82,222 Objects Distribution and sale of electricity and home, sports, relaxation and computer electrical appliances. 102 enersis08 ANNUAL REPORT Business Energy distribution. Principal executive Leonel Martínez Garrido Holding of Enersis (direct & indirect) 99.09% - Unchanged ENDESA ARGENTINA Name Endesa Argentina S.A. Type of company Corporation Address Suipacha 268, piso 12, Buenos Aires, Argentina Telephone (5411) 4307 3040 Objects Investmentrs in companies for the production, transport and distribution of electricity and its sale, and financial activities except for those reserved by law for banks. Business Investments. Subscribed & paid capital (ThCh$) 113,993,484 Board of directors José Miguel Granged Bruñen Néstor José Belgrano Francisco Martín Gutiérrez Alternate directors María Inés Corrá Marcelo A. Den Toom Hugo Pedro Lafalce Shareholding of Enersis (direct & indirect) 59.98% - Unchanged. ENDESA BRASIL Name Endesa Brasil S.A. Type of company Corporation Adddress Praça Leoni Ramos, 1 – 7 andar – bl. 02 - Parte, Niterói, Río de Janeiro, Brazil Telephone (5521) 3607 9500 Subscribed & paid capital (ThCh$) 225,542,537 Objects a ) Par ticipation in the c apit al of other companies that act or become constituted to act directly or indirectly in any segment of the elec tricit y sec tor, including companies that provide ser vices to companies in that sector, in Brazil or elsewhere, as partner or shareholder, within the legally permitted limits and, where necessary, subject to obtaining the necessary government approvals; b) the provision of transmission, distribution, generation or selling of electricity and related activities; and c) participation, individually or through joint ventures, consortia or other similar forms of association, in tenders, projects and enterprises for the provision of the ser vices and ac tivities mentioned above. Business Investments. Board of directors Mario Fernando de Melo Santos José María Calvo-Sotelo Martín Ignacio Antoñanzas Alvear (Chief Executive Officer of Enersis) Antonio B. Carvalho e Albuquerque Rafael Mateo Alcalá Rafael López Rueda Principal executives Marcelo Llévenes Rebolledo Luiz Carlos Bettencourt Aurelio De Oliveira Eugenio Cabanes Antonio Pires e Albuquerque Carlos Ewandro Naegele Moreira José Alves de Mello Franco Enrique de las Morenas Shareholding of Enersis (direct & indirect) 53.57% - Unchanged. Proportion of Enersis’s assets 7.03% ENDESA CHILE Name Empresa Nacional de Electricidad S.A. Type of company Open corporation Tax No. 91,081,000-6 Address Santa Rosa 76, Santiago, Chile Telephone (56 2) 630 9000 Subscribed & paid capital (ThCh$) 1,331,714,085 Objects Generation and supply of electricity, sale of consultancy and engineering services in Chile and elsewhere and the construction and exploitation of infrastructure works. Business Energy generation Board of directors Mario Valcarce Durán Juan Gallardo Cruces Francesco Buresti Pío Cabanillas Alonso Fernando D’Ornellas Silva Borja Prado Eulate Jaime Estévez Valencia Leonidas Vial Echeverría Raimundo Valenzuela Lang Principal executives Rafael Mateo Alcalá Renato Fernández Baeza Carlos Martín Vergara Manuel Irarrázaval Aldunate Juan Carlos Mundaca Álvarez Julio Valbuena Sánchez José Venegas Maluenda Sebastián Fernández Cox Juan Benabarre Benaiges Claudio Iglesis Guillard Commercial relations Trading current accounts, provision of accounting, money desk and treasury services. Shareholding of Enersis (direct & indirect) 59.98% - Unchanged. Proportion of Enersis’s assets 44.05% ENDESA ECO Name Endesa Eco S.A. Type of company Closely-held corporation Tax No. 76,313,310-9 Address Santa Rosa 76, piso 12, Santiago, Chile Telephone (56 2) 630 9000 Subscribed & paid capital (ThCh$) 681,845 Objects Promote and develop renewable energy projects like mini hydroelectric, wind, geothermal, solar, biomass and others; identify and develop clean development mechanism (CDM) projects and act as depositary and trader of emission reduction certificates generated by these projects. Business Energy generation. Board of directors Juan Benabarre Benaiges Manuel Irarrázaval Aldunate Renato Fernández Baeza Principal executive Wilfredo Jara Tirapegui Shareholding of Enersis (direct & indirect) 59.98% - Unchanged. ENDESA FORTALEzA Name CGTF - Central Geradora Termeléctrica Fortaleza S.A. Type of company Closely-held corporation Address Rodovia 422, Km 1 s /n, Complexo Industrial e Portuário de Pecém Caucaia – Ceará, Brazil Telephone (55 85) 3464-4100 Subscribed & paid capital (ThCh$) 41,132,630 Objects a) Study, project, construct and explore systems of production, transmission, distribution and commercialization of electricity under concessions, permits or authorizations under any title, and other activities related to the provision of services of any kind related to the above activities; b) the acquisition, obtaining and exploration of any right, concession or privilege related to the above activities and the carrying out of all the other acts and business ANNUAL REPORT IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES 103 necessary for achieving its objects; and c) participation in the capital of other companies as shareholder or partner, whatever their objects. ENERGEX Name Energex Co. Business Energy generation. Type of company Exempt company Address Marcelo Andrés Llévenes Rebolledo Guilherme Gomes Lencastre Principal executives Manuel Herrera Vargas Raimundo Câmara Filho Luiz Carlos Bettencourt José Ignácio Pires Medeiros Aurélio Bustilho de Oliveira José Alves de Mello Franco Eugenio Cabanes Ana Claudia Gonçalves Rebello Shareholding of Enersis (direct & indirect) 53.57% - Unchanged. Address Caledonian House P.O. Box 265 G, George Town, Grand Cayman, Cayman Islands Subscribed & paid capital (ThCh$) 6,365 Objects Any business or activity according to the laws of the Cayman Islands. In the case of businesses or activities in the financial area, excepted are those reserved for banks. It is also forbidden to do business with firms or persons domiciled in the Cayman Islands. ENDESA MARKET PLACE Business Investments. Name Endesa Market Place (in liquidation) Type of company Foreign corporation Address Ribera de Loira, 60 CP 28042, Madrid, Spain Telephone (3491) 213 1000 Subscribed & paid capital (euros) 6,743,800 Objects B2B and new technologies. Liquidator Ramón Cabezas Navas Shareholding of Enersis (direct & indirect) 15% - Unchanged. Board of directors Manuel Irarrázaval Aldunate Daniel Bortnik Ventura Ricardo Rodríguez Horacio Reyser Shareholding of Enersis (direct & indirect) 29.99% - Unchanged. ENIGESA Name Endesa Inversiones Generales S.A. Type of company Closely-held corporation Tax No. 96,526,450-7 Address Santa Rosa 76, Santiago, Chile Telephone (56 2) 630 9000 Paid capital (ThCh$) 3,055,838 Paid capital (ThCh$) 185,515,048 Objects The acquisition, sale, administration and exploitation, for its own or third party’s account, of all kinds of real estate, movable assets, securities and other commercial paper; carr y out studies and consultancies; provide all kinds of services; participate on all kinas of investments and especially those related to the electricity business; participate in all kinds of company and carr y out all operations, ac ts and contracts related to the above objects. Business Real estate. Board of directors Manuel Irarrázaval Aldunate Juan Carlos Mundaca Álvarez Jaime Montero Valenzuela Principal executive Juan Carlos Mundaca Álvarez Commercial relations Rental of properties. Shareholding of Enersis (direct & indirect) 59.96% - Unchanged. GASATACAMA Name GasAtacama S.A. Type of company Closely-held corporation Tax No. 96,830,980-3 Objects a) The administration and management o f t h e c o m p a n i e s G a s o d u c t o Atacama Chile Limitada, Gasoducto A t a c a m a A r g e n t i n a L i m i t a d a , GasAtacama Generación Limitada and other companies agreed to by t h e sha re h o l d e r s ; b ) inv e s t m e n t of resources, own or third party’s, in all kinds of assets, corporeal or incorporeal, securities, shares and commercial paper. Business Investments. Board of directors Rafael Mateo Alcalá Manuel Irarrázaval Aldunate Raúl Sotomayor Valenzuela Gonzalo Dulanto Letelier Alternate directors Juan Benabarre Benaiges Claudio Iglesis Guillard Pedro Pablo Errázuriz Domínguez Eduardo Ojea Quintana Principal executive Rudolf Araneda Kauert Shareholding of Enersis (direct & indirect) 29.99% - Unchange. GASATACAMA CHILE Name GasAtacama Chile S.A. Type of company Closely-held corporation Address Isidora Goyenechea 3365, piso 8, Santiago, Chile Tax No. 78,932,860-9 Telephone (562) 366 3800 Address Isidora Goyenechea 3365, piso 8, Las Condes, Santiago, Chile Telephone (562) 366 3800 Paid capital (ThCh$) 117,759,280 Objects a ) E x p l o i t t h e g e n e r a t i o n , transmission, purchase, distribution and sale or electricity or any other nature; b) the purchase, extraction, exploitation, processing, distribution, c o m m e r c i a l i z a t i o n a n d s a l e o f c o m b u s t i b l e s o l i d s , l i q u i d s a n d gases; c) the sale and provision of engineering services; d) the obtaining, purchase, transfer, rental, charging and exploitation in any way of the concessions referred to in the General Elec trical Ser vices L aw, maritime concessions and water-usage rights of any kind; e) the transport of natural gas, through its own means or together with other parties within Chile or other countries, including the construction, lo c atio n an d e x ploi t atio n of gas pipelines and other activities related directly or indirectly to it; f ) invest in all kinds of assets, corporeal or incorporeal, movable or immovable; g) the organization and constitution of all kinds of company whose objects are related or linked to energy in any of its forms or that have electricity as their principal input, or correspond to any of the activities mentioned above. Business Electricity generation & transportation of gas. Board of directors Rafael Mateo Alcalá Manuel Irarrázaval Aldunate Raúl Sotomayor Valenzuela Gonzalo Dulanto Letelier Alternate directors Juan Benabarre Benaiges Claudio Iglesis Guillard Pedro Pablo Errázuriz Domínguez Eduardo Ojea Quintana Principal executive Rudolf Araneda Kauert 104 enersis08 ANNUAL REPORT Shareholding of Enersis (direct & indirect) 29.99% - Unchanged. GASODUCTO ATACAMA ARGENTINA Name Gasoducto Atacama Argentina S.A. Type of company Closely-held corporation Tax No. 78,952,429-3 Address Isidora Goyenechea 3365, piso 8, Las Condes, Santiago, Chile Telephone (562) 366 3800 Paid capital (ThCh$) 132,491,785 Objects The transport of natural gas, through its own means or together with other parties within Chile or other countries, including the construction, location and exploitation of gas pipelines and other activities related directly or indirectly to it Business Gas transportation. Board of directors Pedro De la Sotta Sánchez Luis Vergara Aguilar Rafael Zamorano Chaparro Principal executives Rudolf Araneda Kauert Shareholding of Enersis (direct & indirect) 29.99% - Unchanged. GASODUCTO TALTAL GENERANDES PERÚ GNL CHILE Name Gasoducto Taltal S.A. Type of company Closely-held corporation Tax No. 77,032,280-4 Address Santa Rosa 76, Santiago, Chile Telephone (562) 630 9000 Objects The transport, commercialization and distribution of natural gas, through its own means or together with other parties within Chile, especially in the towns of Mejillones and Paposo in the 2nd Region, including the construction, lo c atio n an d e x ploi t atio n of gas pipelines and other activities related directly or indirectly to it Business Gas transportation. Paid capital (ThCh$) 14,953,214 Board of directors Rudolf Araneda Kauert Pedro De la Sotta Sánchez Rafael Zamorano Chaparro Luis Vergara Aguilar Alternate directors Luis Cerda Ahumada Alejandro Sáez Carreño Gustavo Venegas Castro Verónica Cortez Silva Principal executive Rudolf Araneda Shareholding of Enersis (direct & indirect) 29.99% - Unchanged. Name Generandes Perú S.A. Type of company Corporation Address Avda. Víctor Andrés Belaúnde 147, Torre Real, piso 7, San Isidro, Lima, Peru Telephone (511) 215 6300 Paid capital (ThCh$) 226,548,198 Objects A c t i v i t i e s r e l a t e d t o e l e c t r i c i t y generation, directly and /or through c o m p a n i e s c o n s t i t u t e d f o r t h i s purpose. Business Investments. Board of directors Rafael Mateo Alcalá Javier García Burgos Benfield Mario Valcarce Durán Juan Benabarre Benaiges José Chueca Romero Ignacio Blanco Fernández Giora Almogy Alberto Triulzi Mora Directores suplentes Julián Cabello Yong José María Hidalgo Martín-Mateos Milagros Noriega Cerna Roberto Cornejo Spickernagel Guillermo Lozada Pozo Rosa María Flores-Aráoz Cedrón Carlos Rosas Cedillo Juan Carlos Camogliano Pazos Principal executives Carlos Luna Cabrera Milagros Noriega Cerna Shareholding of Enersis (direct & indirect) 36.59% (+ 0.82% change). Name GNL Chile S.A. Type of company Closely-held corporation Tax No. 76,418,940-K Address Avda. Apoquindo 3.500, piso 6, Las Condes, Santiago, Chile Telephone (562) 499 0920 Paid capital (ThCh$) 1,926,000 Objects a) Contract the services of the liquefied natural gas ( LNG ) re- gasification company GNL Quintero S.A. and use all the LNG storage, processing and re- gasification capacit y of it s re- gasification terminal, including its expansions if any and any other matter stated in the contract that the Company signs for the use of the re-gasification terminal; b) import LNG under the d e l i v e r e d o n s h i p ( D E S ) m e t h o d from LNG suppliers under purchase agreements; c) the sale and delivery of natural gas under contracts signed by the company with its customers; d ) administer and coordinate the programming and nominations of LNG cargoes, and the delivery of natural gas among the different customers; e) comply with all its obligations and demand compliance with all its rights under the contracts mentioned and coordinate all the activities covered by them, and in general carry out any type of act or contract that may be necessary, useful or convenient for meeting its objects. Business Sale of LNG. Board of drectors Rafael Mateo Alcalá Eduardo Morandé Montt Alternate directors Gonzalo Palacios Vásquez Rosa Herrera Martinez José Venegas Maluenda Principal executive Antonio Bacigalupo Gittins Shareholding of Enersis (direct & indirect) 19.99% - Unchanged. GNL QUINTERO Name GNL Quintero S.A. Type of company Closely-held corporation Tax No. 76,788,080-4 Address Avda. Apoquindo 3.500, piso 6, Las Condes, Santiago, Chile Telephone (562) 499 0900 Paid capital (ThChM$) 124,669,324 Objects D e v e l o p , f i n a n c e , d e s i g n a n d engineering, supply, construct, start- up, test, conclude, acquire, operate and maintain the liquefied natural gas (LNG) re-gasification terminal and any other activity leading or related to this object, including but not limited to the direction and management of all the commercial agreements necessar y for the reception of LNG (or deliver to customers), LNG re-gasification, distribution of LNG re-gasified to the respective distribution point and the sale of storage services and capacity, processing and re - gasif ication of the re-gasification terminal and its ANNUAL REPORT IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES 105 hydroelectric generation project that Hidroaysén is planning to build in the 11th Region of Aysén, Chile. Business Investments. expansions, if any. Perform any type of act or contract that may be necessary, useful or convenient for meeting the object. Business LNG re-gasification. Board of directors Rafael Mateo Alcalá Eduardo Morandé Montt William Jude Way Elizabeth Grace Spomer Alternate directors Graham Cockroft Sergio Arévalo Espinoza Claudio Iglesis Guillard Francisco Gazmuri Schleyer Diego Hollweck Principal executive Antonio Bacigalupo Gittins Shareholding of Enersis (direct & indirect) 12% - Unchanged. HIDROAYSÉN TRANSMISIÓN Name HidroAysén Transmisión S.A. Type of company Closely-held corporation Tax No. 76,041,891-9 Address Miraflores 383, Of. 1302, Santiago, Chile Telephone (562) 713 5000 Paid capital (ThCh$) 31,823 Business Electricity transmission (project). Board of directors Antonio Albarrán Ruiz-Clavijo Rafael Mateo Alcalá Juan Benabarre Benaiges Bernardo Larraín Matte Luis Felipe Gazitúa Achondo Rodrigo Alcaíno Mardones Alternate directors Carlos Martín Vergara Sebastián Fernández Cox Claudio Iglesis Guillard Eduardo Morel Montes Carlos Urenda Aldunate Cristián Morales Jaureguiberry Principal executives Hernán Salazar Zencovich Shareholding of Enersis (direct & indirect) 30.59% (new company). HIDROINVEST Name Hidroinvest S.A. Type of company Corporation Address Avda. España 3301, Buenos Aires, Argentina Telephone (5411) 4307 3040 Paid capital (ThCh$) 28,655,139 Board of directors Rafael Mateo Alcalá José Miguel Granged Bruñen Miguel Ortiz Fuentes Fernando Claudio Antognazza Julio Valbuena Sánchez Carlos Martín Vergara Francisco Domingo Monteleone Roberto José Fagan Alternate directors Daniel Garrido José María Hidalgo Martín-Mateos Juan Carlos Blanco Manuel Irarrázaval Aldunate Jorge Burlando Bonino Rodrigo Quesada Rodolfo Bettinsoli Fernando Boggini Shareholding of Enersis (direct & indirect) 57.64% - Unchanged. INGENDESA Name Empresa de Ingeniería Ingendesa S.A. Type of company Closely-held corporation Tax No. 96,588,800-4 Address Santa Rosa 76, Santiago, Chile Telephone (562) 630 9000 Paid capital (ThCh$) 2,383,485 dif ferent fields, of environmental a d v i c e, i n c l u d i n g t h e m a k i n g o f environmental impac t studies and in general consultanc y ser vices in every specialty, in Chile and abroad, whether directly, associated with or through third parties, for which it may form or join companies, corporations, foundations or consortia of any kind. Business Engineering services. Board of directors Juan Benabarre Benaiges Rafael de Cea Chicano Aníbal Bascuñán Bascuñán Principal executive Rodrigo Alcaíno Mardones Shareholding of Enersis (direct & indirect) 59.98% - Unchanged. INGENDESA - ARA Name Sociedad Consorcio Ingendesa - Ara Ltda. Type of company Limited partnership Tax No. 76,197,570-6 Address Santa Rosa 76, piso 10, Santiago, Chile Telephone (562) 630 9000 Paid capital (ThCh$) 1,000 Objects D e v e l o p , a n d a l t e r n a t i v e l y o r additionally manage, the electricity transmission systems required by the Objects Acquire and maint ain a majorit y shareholding in Hidroeléc tric a El Chocón S.A. Objects The provision of engineering services, inspection of works, inspection and reception of materials and equipment, o f l a b o r a t o r y, o f a p p r a i s a l s , o f m a n a g e m e n t o f c o m p a n i e s i n Objects Provision of engineering ser vices, including the projection, planning and carrying out of engineering studies and projects, providing advice and consultancies, granting of assistance and technical information and the a d m i n i s t r a t i o n , i n s p e c t i o n a n d development of projects and works. Business Engineering services. Representatives Rodrigo Alcaíno Mardones Alejandro Santolaya de Pablo Alternative representatives Cristian Araneda Valdivieso Elías Arce Cyr Julio Montero Montegú Fernando Orellana Welch Shareholding of Enersis (direct & indirect) 29.99% - Unchanged. INGENDESA BRASIL Name Ingendesa do Brasil Ltda. Type of company Limited partnership Address Avda. Rio Branco 115, pavimento 10, sala 1005, Centro, Río de Janeiro, Brazil Telephone (5521) 2232 9039 Paid capital (ThCh$) 126,015 Objects The provision of services of engineering, studies, projects, technical consultancy, a d m i n i s t r a t i o n , i n s p e c t i o n a n d supervision of works, inspection and reception of materials and equipment, laboratory, appraisals, commercial representation of Chilean and foreign engineering companies, and other services that the legal powers permit in the practice of the professions or engineering, architecture, agronomy, geology and meteorology in all their specialties in Chile and abroad, whether 106 enersis08 ANNUAL REPORT directly or indirectly, for which it may participate in companies or consortia of any kind. Holding of Enersis (direct & indirect) 29.99% - Unchanged. Proportion of Enersis’s assets 0.78% Type of company Foreign corporation Type of company Closely-held corporation Business Engineering services. Representative Sergio Campos Ribeiro Holding of Enersis (direct & indirect) 59.98% - Unchanged. INGENDESA MINMETAL Name Consorcio Ingendesa–Minmetal Ltda. Type of company Limited partnership Tax No. 77,573,910-k Address Santa Rosa 76, Santiago, Chile Telephone (562) 630 9000 Objects The provision of engineering services, including the projection, planning and making of engineering studies and projects, advice and consultancy, the granting of technical assistance and information and the administration, inspection and development of projects and works. Business Engineering services. Paid capital (ThCh$) 2,000 Representatives Rodrigo Muñoz Pereira Rodrigo Alcaíno Mardones Alternate representatives Fernando Orellana Welch Osvaldo Dinner Reich Carlos Freire Canto INMOBILIARIA MANSO DE VELASCO Name Inmobiliaria Manso de Velasco Ltda. Type of company Limited partnership Tax No. 79,913,810-7 Address Miraflores 383, piso 29, Santiago, Chile Telephone (562) 378 4700 Objects Acquisition, disposal, commercialization and exploitation of real estate and investment companies. Business Real estate. Subscribed & paid capital (ThCh$) 25,916,800 Representatives Cristóbal Sanchez Romero Andrés Salas Estrades Principal executives Andrés Salas Estrades Alfonso Salgado Menchaca Bernardo Küpfer Matte Hugo Ayala Espinoza Commercial relations Rental of proper ties, provision of money desk, accounting, tax and other services. Trading current account. Holding of Enersis 100% - Unchanged. INVERSIONES CODENSA S.A. Name Inversiones Codensa S.A. Type of company Coporation Address C a r r e r a 13 A N 93 - 6 6 , B o g o t á , Colombia Telephone (571) 601 6060 Address Jr. Teniente César López Rojas 201, Maranga, San Miguel, Lima, Peru. Tax No. 96,889,570-2 Telephone (511) 561 1604 Address Evaristo Lillo 78, piso 4, Of. 41, Santiago, Chile Subscribed & paid capital (ThCh$) 60,324,359 Telephone (562) 321 7737 Objects Make investments in general, especially those related to the distribution and generation and other operations of electricity. Objects To buy, sell, invest and hold shares in the closely-held company Electrogas S.A. Subscribed &paid capital (ThCh$) 3,141 Business Investments. Objects Investment in residential energy public- utility service activities, especially the acquisition of shares in any company dedicated to that business. Business Investments. Board of directors Lucio Rubio Díaz Andrés Caldas Rico Mario Trujillo Hernández Directores suplentes Margarita Olano Olano Álvaro Francisco Camacho Borrero Fabiola Leal Castro Legal representative Cristián Herrera Fernández Shareholding of Enersis (direct & indirect) 21.67% - Unchanged. INVERSIONES DISTRILIMA Name Inversiones Distrilima S.A. Board of directors Ignacio Blanco Fernández Reynaldo Llosa Barber Rafael López Rueda Ramiro Alfonsín Balza (Chief Regional Planning & Control Officer of Enersis) Alternate directors Manuel Muñoz Laguna Ricardo Camezzana Leo Fernando Fort Marie Walter Néstor Sciutto Brattoli Zoila Patricia Mascaró Díaz Principal executive Ignacio Blanco Fernández Shareholding of Enersis (direct & indirect) 55.90% - Unchanged. Proportion of Enersis’s assets 0.65% INVERSIONES ELECTROGAS Business Investments. Paid capital (ThCh$) 12,117,936 Board of directors Felipe Aldunate Hederra Claudio Iglesis Guillard Pedro Gatica Kerr Enrique Donoso Moscoso Rosa Herrera Martínez Alternate directors Sergio Arévalo Espinoza Jorge B. Larraín Matte Ricardo Santibáñez Zamora Gastón Cáceres Videla Principal executives Carlos Andreani Luco Shareholding of Enersis (direct & indirect) 25.49% - Unchanged. INVERSIONES ENDESA NORTE Name Inversiones Endesa Norte S.A. Name Inversiones Electrogas S.A. Type of company Closely-held corporation ANNUAL REPORT IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES 107 Tax No. 96,887,060-2 Telephone (562) 366 3800 Address Carrera 13 A 93-66, Bogotá, Colombia Board of directors None Address Santa Rosa 76, Santiago, Chile Telephone (562) 630 9000 Objects Make investments in energy projects i n t h e n o r t h o f C h i l e r e l a t e d t o the companies of the GasAtacama project. Business Investments. Paid capital (ThCh$) 92,571,642 Board of directors Rafael Mateo Alcalá Manuel Irarrázaval Aldunate Daniel Bortnik Ventura Alternate directors Claudio Iglesis Guillard Juan Benabarre Benaiges Raúl Arteaga Errázuriz Principal executives Juan Benabarre Benaiges Shareholding of Enersis (direct & indirect) 59.98% - Unchanged INVERSIONES GASATACAMA HOLDING Name Inversiones Gasatacama Holding Limitada Type of company Limited partnership Tax No. 76,014,570-K Address Isidora Goyenechea 3365, piso 8, Santiago, Chile Objects a) The direct or indirect participation through any kind of association in companies whose objects are one or more of the following: i) the transport of natural gas in any of its forms; ii) the generation, transmission, purchase, distribution and sale of energy, and iii) financing of the activities stated in i) and ii) above managed by third parties. b) the perception and investment of the assets invested in. The objects include all lucrative activities related to the above and other businesses that the partners agree. Business Investments. Paid capital (ThCh$) 212,268,290 Board of directors Rafael Mateo Alcalá Manuel Irarrázaval Aldunate Raúl Sotomayor Valenzuela Gonzalo Dulanto Letelier Alternate directors Juan Benabarre Benaiges Claudio Iglesis Guillard Pedro Pablo Errázuriz Domínguez Eduardo Ojea Quintana Principal executive Rudolf Araneda Kauert Holding of Enersis (direct & indirect) 29.99% - Unchanged. INVERSORA CODENSA LTDA. U Name Inversora Codensa Ltda. U Type of company Limited unipersonal entity Telephone (571) 601 6060 Capital (Colombian $) 5,000,000 Objects Inve s t ment in re sid ential energ y public utility services, especially the acquisition of shares in any company in that business or that in turn invests in that business. Business Investments. Legal representative Cristian Herrera Fernández Holding of Enersis (direct & indirect) 21.73% - Unchanged INVESTLUz Name Investluz S.A. Type of company Foreign corporation Management committee Abel Alves Rochinha Luiz Carlos Bettencourt Silvia Cunha Saraiva Pereira José Renato Ferreira Barreto Olga Jovanna Carranza Salazar Shareholding of Enersis (direct & indirect) 59.51% - Unchanged. KONECTA CHILE Name Konecta Chile S.A. Type of company Closely-held corporation Tax No. 76,583,350-7 Address Miraflores 383, piso 26, Santiago, Chile Telephone (56 2) 447 8687 Paid capital (ThCh$) 300 Address Avda. Barão de Studart 2917, Bairro Dionísio Torres For taleza, Ceará, Brazil Objects C o n t a c t c e n t e r , o u t s o u r c i n g , organization of events, IT services, collections, commercialization movable assets, investments. Telephone (5585) 3216 1350 Subscribed & paid capital (ThCh$) 543,062,718 Objects Par ticipate in the share capital of Co m p a n hia En e r g e t ic a d o Ce a r á and other companies in Brazil and elsewhere, as partner or shareholder. Business Investments. Business Call center. Board of directors José Ignacio González Alemán Miguel Fernández Robledo Rafael Miguel Barroso Aceña Leonardo Covalschi Buono Juan Seco Sousa Principal executive Patricio Martínez Sola Shareholding of Enersis (direct & indirect) 26.20% LUz ANDES Name Luz Andes Limitada Type of company Limited partnership Tax No. 96,800,460-3 Address Santa Rosa 76, piso 5, Santiago, Chile Telephone (56 2) 634 6310 Paid capital (Ch$) 1,224,348 Objects Distribution and sale of electricity and sale of electrical appliances for the home, spor t s, rela xation and computers. Business Distribution of electricity. Principal executive Claudio Inzunza Díaz Holding of Enersis (direct & indirect) 99.09% - Unchanged. PANGUE Name Empresa Eléctrica Pangue S.A. Type of company Closely-held corporation Tax No. 96,589,170-6 Address Santa Rosa 76, Santiago, Chile 108 enersis08 ANNUAL REPORT Telephone (562) 630 9000 Objects The production, transport, distribution and supply of elec tricit y from the Pangue plant in the valley of the Biobío river. Business Electricity generation. Paid capital (ThCh$) 91,041,497 Board of directors Claudio Iglesis Guillard Alan Fischer Hill Alejandro García Chacón Principal executive Lionel Roa Burgos Shareholding of Enersis (direct & indirect) 56.97% - Unchanged. PEHUENCHE Paid capital (ThCh$) 200,319,020 Board of directors Claudio Iglesis Guillard Alan Fischer Hill Pedro Gatica Kerr Enrique Lozán Jiménez Osvaldo Muñoz Díaz Alejandro García Chacón Daniel Bortnik Ventura Principal executive Lucio Castro Márquez Shareholding of Enersis (direct & indirect) 55.57% - Unchanged. PROGAS Name Progas S.A. Type of company Closely-held corporation Tax No. 77,625,850-4 Paid capital (ThCh$) 1,211 Board of directors Rudolf Araneda Kauert Luis Cerda Ahumada Pedro De La Sotta Sánchez Principal executive Alejandro Sáez Carreño Shareholding of Enersis (direct & indirect) 29.99% - Unchanged. SACME Name Sacme S.A. Type of company Closely-held corporation Address Avda. España 3251, Ciudad Autónoma de Buenos Aires, Argentina Telephone (5411) 4361 5107 Name Empresa Eléctrica Pehuenche S.A. Type of company Closely-held corporation Tax No. 96,504,980-0 Address Santa Rosa 76, Santiago, Chile Telephone (562) 630 9000 Objects The generation, transport, distribution and supply of electricity for which it may acquire and use the respective concessions and grants. Business Electricity generation. Address Isidora Goyenechea 3356, 8 piso, Santiago, Chile Subscribed & paid capital (Argentine $) 12,000 Objects Develop the following businesses in the 1st, 2nd and 3rd Regions of Chile: a) the acquisition, production, storage, transport, distribution, transformation and commercialization of natural gas; b) the acquisition, production, storage, transport, distribution, transformation and commercialization of other oil derivatives and fuels in general; c) the provision of services, manufacture, commercialization of equipment and materials, and carr ying out works related to the above objects or those necessar y for their execution and development; and d) any other activity necessary or conducing to compliance with the above objects. Objects Co n d u c t , s u p e r v i s e a n d c o n t r o l t h e o p e r a t i o n o f t h e e l e c t r i c i t y generation, transmission and sub- transmission system of the Federal Capital and Greater Buenos Aires, and the interconnections with the Argentine Interconnec tion System ( SADI ) . Represent the companies Distribuidora Edenor S.A. and Edesur S.A. in the operative management before the Compañía Administradora d el M erc ad o Mayoris t a Elé c t rico (CAMMESA) (the wholesale market administrator). In general, take all kinds of action for satisfactorily carrying out its management, as being constituted for this purpose by the concession- holding companies of the electricity distribution and commercialization services in the Federal Capital and Greater Buenos Aires, all in accordance with the international public tender for the sale of Class A shares in Edenor S.A. and Edesur S.A. and applicable regulations. Business Conduction, supervision and control of the operation of part of the Argentine electricity system. Board of directors Ricardo Héctor Sericano Daniel Héctor Colombo Leandro Ostuni Eduardo Maggi Alternate directors Abel Cresta Leonardo Félix Druker Pedro Rosenfeld Rubén Besada Representatives Héctor Ruiz Moreno Clemente Alonso Hidalgo Jaime Javier Barba Alternate representatives Juan Antonio Garade Darío Aníbal Ricciardi Daniel Peraudo Principal executive Osvaldo Rolando Shareholding of Enersis (direct & indirect) 32.69% - Unchanged. SAN ISIDRO Name Compañía Eléctrica San Isidro S.A. Type of company Closely-held corporation Tax No. 96,783,220-0 Address Santa Rosa 76, Santiago, Chile Telephone (56 2) 630 9000 Objects The generation, transport, distribution and supply of electricity. Business Electricity generation Paid capital (ThCh$) 39,005,904 Board of directors Alejandro García Chacón Alan Fischer Hill Claudio Iglesis Guillard Pedro Gatica Kerr Ricardo Santibáñez Zamorano Alternate directors Rodrigo Naranjo Martorell Carlo Carvallo Artiga Osvaldo Muñoz Díaz Claudio Betti Pruzo Enrique Lozán Jiménez Principal executive Claudio Iglesis Guillard Shareholding of Enersis (direct & indirect) 59.98% - Unchanged. SISTEMAS SEC Name Sistema SEC S.A. Type of company Closely-held corporation Tax No. 99,584,600-4 Address Miraflores 383, piso 10, Of. 1004, Santiago, Chile ANNUAL REPORT IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES 109 Objects Develop the engineering, supply, a s s e m b l y, t e s t i n g , s t a r t- u p a n d m a i n t e n a n c e o f t h e s i g n a l i n g , electrification and communications systems for the sec tors Alameda- Chillán, Hualqui-Talc ahuano and Concepción-Lomas Coloradas, which implies the development of all the ac tivities and provision of all the ser vices subjec t to the signaling, electrification and communications contract in the public tender that was adjudicated by Empresa de Ferrocarriles del Estado, plus the activities and services permitted by that contract. Business D evelo p and maint ain signaling, electrification and communications systems. Paid capital (ThCh$) 2,266,603 Board of directors Cristóbal Sanchez Romero Ángel Aguilar Bueno Klaus Winkler Speringer Jaime Godoy Cifuentes Francisco Fernández Ávila de Inza Principal executives Jaime Pino Cox Sergio Zúñiga Rojo Shareholding of Enersis (direct & indirect) 49% - Unchanged. SOUTHERM CONE POWER ARGENTINA Telephone (54 11) 4307 3040 Subscribed & paid capital (ThCh$) 4,076,896 Objects For its own or third party’s account, habitually purchase and sell electricity in the wholesale market produced by other parties and to be consumed by others. It may also hold participations in companies dedicated to electricity generation. For its objects, it is legally fully able to acquire rights, contract o bligatio ns and p er fo r m all ac t s that are not prohibited by law of its bylaws. Board of directors José Miguel Granged Bruñen Roberto José Fagan Fernando Claudio Antognazza Alternate director Juan Carlos Blanco Shareholding of Enersis (direct & indirect) 59.98% SYNAPSIS Name Synapsis Soluciones y Ser vicios IT Limitada Type of company Limited partnership Tax No. 96,529,420-1 Name Southern Cone Power Argentina S.A. Address Miraflores 383, piso 27, Santiago Type of company Corporation Telephone (562) 397 6600 Address Avda. España 3301, Buenos Aires, Argentina Subscribed & paid capital (ThCh$) 3,943,580 Objects Supply and sell services and equipment related to computation and data processing for public utility and other Chilean and foreign companies. Sell and supply in Chile and abroad services, equipment and training related to computation and data processing. Invest in companies whose objects are similar, related or linked to energy or computers in all their forms or the supply of public utilities or whose principal input is electricity. Business IT services. Representatives Cristóbal Sánchez Romero Leonardo Covalschi Buono Alternate representatives Eduardo López Miller Raúl Mella Varas Principal executives Leonardo Covalschi Buono Raúl Mella Varas Jorge Orozco Ospina Antonio Bravo Narváez Fernando Mayorano Leonardo Covalschi Buono Aldo Monje Roma Raúl Mella Varas Rocio Niño Guerra Aldo Cortes Díaz Juan Miguel Comercial relations Trading current account, provision of financial management ser vices, data center and suppor t ser vices. Maintenance of systems, micro IT and electronic mail. Telecommunications and tax consultanc y. Provision of services. Holding of Enersis (direct & indirect) 100% - Unchanged Proportion of Enersis’s assets 0.46% SYNAPSIS ARGENTINA Name Synapsis Argentina S.R.L. Type of company Limited partnership Address Azopardo 1335, e / Juan de Garay y Cochabamba, Cod. Postal 1064, Capital Federal, Buenos Aires, Argentina Telephone (5411) 4021 8300 Subscribed & paid capital (ThCh$) 279,662 Objects Principally the provision of services related to computerization, dat a processing and other IT services in telecommunications and control, plus training in the activities related to the services provided. Business IT services. Principal executives Cristóbal Sanchez Romero Leonardo Covalschi Buono Fernando Mayorano Mariano F. Grondona Holding of Enersis (direct & indirect) 100% - Unchanged Proportion of Enersis’s assets 0.01% SYNAPSIS BRASIL Name Synapsis Brasil Limitada Type of company Limited partnership Address Avda. das Américas 3434, Bloco 2, Sala 403, Barra da Tijuca, Río Janeiro, Brazil - Cep: 22640-102 Telephone (5521) 3431 3850 Subscribed & paid capital (ThCh$) 716 Objects Provision of consultanc y ser vices and technical assistance related to the IT sector and data processing for Brazilian and foreign companies; the development of computer programs and systems; the sale of computer an d dat a p ro ce s sin g e quip m ent ; the manufac ture, purchase, sale, i m p o r t , e x p o r t , r e p r e s e n t a t i o n , consignment and distribution of all types of assets, mobile and immobile, connected to objects stated above and participations in other civil or commercial, national or foreign, companies that operate in the sectors of IT, electricity or the management and/or operation of public utilities in electricity, telecommunications, water for domestic or industrial use and sewage, as shareholder or partner; and participations in joint ventures, consortia and partnerships. Business IT services. Board of directors Chairman Carlos Alberto Acero Principal executives Carlos Alberto Acero Jacqueline Gómez Da Silva Marcia Caporazzo Almeida José Roberto Galdino Alexandre Maiotto Marcelo Picchi Holding of Enersis (direct & indirect) 100% - Unchanged 110 enersis08 ANNUAL REPORT SYNAPSIS COLOMBIA Name Synapsis Colombia Limitada Type of company Limited partnership Address Carrera 14 85- 68, piso 5, Edificio Torres Bogotá, D.C. Telephone (571) 607 6000 Subscribed & paid capital (ThCh$) 82,065 Objects Supply and sell services and equipment related to computerization and data processing for public utility and other national and foreign companies. Business IT services. Representatives Leonardo Covalschi Buono Edgar Enrique Martínez Niño Robin Barquin Pardo Ana Patricia Delgado Meza Principal executives Robin Barquín Pardo Edgar Martínez Niño Sonia Rodríguez García Eduardo Ruiz Alonso Patricia Delgado Meza Norberto Duarte Holding of Enersis (direct & indirect) 100% - Unchanged. Proportion of Enersis’s assets 0.00% SYNAPSIS PERÚ Name Synapsis del Perú S.R.L. Type of company Limited partnership Subscribed & paid capital (ThCh$) 92,160 Address Jr. Teniente César López Rojas 201, piso 10, Maranga, San Miguel, Lima, Peru Telephone (511) 561 0386 Subscribed & paid capital (ThCh$) 111,379 Objects P r o v i d e s e r v i c e s r e l a t e d t o computerization, data processing and other IT services and control, and training in the activities related to the services provided. Business IT services. Principal executives Claudio Escudero Alzamora Jessenia Quevedo Fudino Eduardo Bedoya Arromatari Mario Nieto Béjar Pedro Luna Delgado Carlos Castillo Prada José Carlos Silva Torres Holding of Enersis (direct & indirect) 100% - Unchanged. TERMOELÉCTRICA JOSÉ DE SAN MARTÍN Name Termoeléctrica José de San Martín S.A. Type of company Corporation Address Hipólito Bouchard 547, piso 27, Buenos Aires, Argentina Telephone (511) 561 0386 Objects T h e p r o d u c t i o n o f e l e c t r i c i t y and it s blo ck commercialization, particularly the management of the equipment, construction, operation and maintenance of a thermal plant in accordance with the “Definitive agreement for the management and operation of the projects for the re- adaptation of the MEM in the terms of Resolution SE 1427/2004”, approved by Resolution SE 1193/2005. For this, it may carry out those complementary and subsidiary activities linked to the objects, having full legal powers to acquired rights and contract obligations and perform all acts not prohibited by law or its bylaws. Business Electricity generation. Board of directors Bernardo Velar de Irigoyen Adrián Salvatore José Miguel Granged Bruñen Fernando Claudio Antognazza Milton Gustavo Tomás Pérez Jorge Aníbal Rauber Fermín Oscar Demonte Horacio Jorge Turri Guillermo Luis Fiad Alternate directors José María Vásquez Roberto José Fagan Omar Ramiro Algacibiur Sergio Raúl Sánchez Benjamín Roberto Guzmán Juan Carlos Blanco Carlos Principi Patricio Testotelli Brian Henderson Principal executives Jose María Vázquez Alberto Garmendia Rodriguez Armando Federico Duvo Claudio Majul Marcelo Walter Holmgren Shareholding of Enersis (direct & indirect) 8.32%- Unchanged. TERMOELÉCTRICA MANUEL BELGRANO Name Termoeléctrica Manuel Belgrano S.A. Type of company Corporation Address Suipacha 268, piso 12, Buenos Aires, Argentina Telephone (511) 561 0386 Subscribed & paid capital (ThCh$) 92,160 Objects T h e p r o d u c t i o n o f e l e c t r i c i t y and it s blo ck commercialization, particularly the management of the equipment, construction, operation and maintenance of a thermal plant in accordance with the “Definitive agreement for the management and operation of the projects for the re- adaptation of the MEM in the terms of Resolution SE 1427/2004”, approved by Resolution SE 1193/2005. For this, it may carry out those complementary and subsidiary activities linked to the objects, having full legal powers to acquired rights and contract obligations and perform all acts not prohibited by law or its bylaws. Business Electricity generation. Board of directors José Miguel Granged Bruñen Fernando Claudio Antognazza Horacio Jorge Turri Milton Gustavo Tomás Pérez Jorge Aníbal Rauber Guillermo Luis Fiad Fermín Demonte Bernardo Velar de Irigoyen José María Vásquez Alternate directors Roberto José Fagan Sergio Raúl Sánchez Benjamín Roberto Guzmán Juan Carlos Blanco Carlos Principi Patricio Testorelli Omar Ramiro Algacibiur Brian Henderson Principal executives Miguel Ortiz Fuentes Gustavo Manifesto Óscar Zapiola Daniel Garrido Shareholding of Enersis (direct & indirect) 8.32% - Unchanged. TESA Name Transportadora de Energía S.A. Type of company Corporation Address Bartolomé Mitre 797, piso 13, Of. 79, Buenos Aires, Argentina Telephone (5411) 4394 1161 Paid capital (ThCh$) 7,589,289 Objects The provision of electricity transport services in high tension in relation t o n a t i o n a l a n d i n t e r n a t i o n a l ele c tricit y s y s tems, according to current legislation, for which it may take part in national or international te n d e r s , b e c o m e a p u b lic- u t ili t y concession-holder in high-tension elec tricit y transmission nationally o r i n t e r n a t i o n a l l y, a n d p e r f o r m ANNUAL REPORT IDENTIFICATION OF THE SUBSIDIARY AND ASSOCIATE COMPANIES 111 Notes: 1. There are no acts or contracts entered into by Enersis S.A. with subsidiaries or affiliates that significantly influence the operations of Enersis S.A. 2. Enersis has no investment in the subsidiaries and affiliates which do not include the heading Proportion of Enersis’s assets. 3. Enersis has no commercial relations with the subsidiaries and affiliates which do not include the heading Commercial relations. all ac tivities ne cess ar y for thes e purposes. Business Energy transmission. Board of directors José María Hidalgo Martín-Mateos Guilherme Lencastre Arturo Miguel Pappalardo Alternate directors Juan Carlos Blanco Roberto José Fagan José Venegas Maluenda Shareholding of Enersis (direct & indirect) 53.57% - Unchanged. TRANSQUILLOTA Name Transmisora Eléctrica de Quillota Ltda. Type of company Limited partnership Tax No. 77,017,930-0 Alternate representatives Alfonso Bahamondes Morales Enrique Sánchez Novoa Ricardo Sáez Sánchez Carlos Ferruz Bunster Holding of Enersis (direct & indirect) 29.99% - Unchanged. TÚNEL EL MELÓN Name Sociedad Concesionaria Túnel El Melón S.A. Type of company Closely-held corporation Tax No. 96,671,360-7 Address Santa Rosa 76, Santiago, Chile Telephone (562) 630 9000 Paid capital (ThCh$) 46,709,460 Address Santa Rosa 76, Santiago, Chile Telephone (562) 630 9000 Paid capital (ThCh$) 4,404,446 Objects E x e c u t i o n , c o n s t r u c t i o n a n d exploitation of the public works called El Melón tunnel and the provision of the complementary services authorized by the Ministry of Public Works. Business Infrastructure. Objects The transport, distribution and supply of electricity for its own or third party’s account. Board of directors Manuel Irarrázaval Aldunate Jorge Alé Yarad Renato Fernández Baeza Business Electricity transmission. Representatives Gabriel Carvajal Menególlez Ricardo Santibáñez Zamorano Juan Eduardo Vásquez Moya Enrique Donoso Moscoso Principal executive Maximiliano Ruiz Ortiz Shareholding of Enersis (direct & indirect) 59.98% - Unchanged. 112 enersis08 ANNUAL REPORT DECLARATION OF RESPONSIBILITY ANNUAL REPORT DECLARATION OF RESPONSIBILITY 113 The directors of Enersis and the chief Executive Officern signatories to this declaration swear to be responsible for the truth of all information contained in this annual report, in compliance with general rule N°30 of the Superintendency of Securities and Insurances. CHAIRMAN VICE-CHAIRMAN DIRECTOR DIRECTOR Pablo Yrarrázaval Valdés Tax N°: 5.710.967-K Rafael Miranda Robredo Tax N°: 48.070.966-7 Pedro Larrea Paguaga Tax N°: 48.077.257-K Hernán Somerville Senn Tax N°: 4.132.185-7 DIRECTOR DIRECTOR DIRECTOR GERENTE GENERAL Eugenio Tironi Barrios Tax N°: 5.715.860-3 Patricio Claro Grez Tax N°: 5.206.994-7 Juan Eduardo Errázuriz Ossa Tax N°: 4.108.103-1 Ignacio Antoñanzas Alvear Tax N°: 22.298.662-1 

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