Annual Report
Enel Américas
2017
Santiago Stock Exchange
ENELAM
New York Stock Exchange
ENIA
Enel Américas was initially established under the name Compañía Chilena Metropolitana de Distribución
Eléctrica S.A. On December 1, 2016 the company changed its name to Enel Américas S.A. The Company’s
paid-in capital on December 31, 2017 reached $6,763,204,424 and was represented by 57,452,641,516
shares. These shares are traded in the Chilean stock exchanges and in the New York Stock Exchange in the
form of American Depositary Receipts (ADR).
The main business of the Company is the operation, development, generation, distribution, transmission,
transformation and/ or sale of energy in any of its forms or nature, directly of through other companies.
The Company can also exercise activities in the telecommunications sector, provide engineering advisory
in the country and abroad, and also can invest and manage its investments in its subsidiaries and associate
companies.
Total assets amounted to $20,168,990 thousand on December 31, 2017. Enel Américas controls and
manages a group of companies that operates in the electricity markets in four countries in Latin America
(Argentina, Brazil, Colombia and Peru). In 2017, net income attributable to the controlling company reached
$709,043 thousand and operational income was $2,219,399 thousand. By the end of 2017, the Company
employed 11,393 people through its subsidiaries companies in Latin America.
Annual Report
Enel Américas
2017
2
Annual Report Enel Américas 2017 Contents
> Letter from the Chairman ....................................................................4
> Enel Américas is Open Power .............................................................8
> 2017 Milestones ...............................................................................10
> Main Financial and Operational Indicators ........................................14
> Identification of the Company and Constitutive Documents ............18
> Ownership and Control .....................................................................22
> Administration ...................................................................................28
> Human Resources ............................................................................44
> Exchange Transactions ......................................................................54
> Dividends ..........................................................................................60
> Investment and Financing Policy for 2017 .........................................64
> Company’s Business .........................................................................68
> Investments and Financial Activities .................................................78
> Risk Factors ......................................................................................86
> Regulatory Framework of the Electricity Industry ...........................102
> Description of the Business by Country .........................................126
> Sustainability ...................................................................................148
> Schematic Table of Ownership .......................................................154
> Significant Events of the Company .................................................160
> Identification of Subsidiaries and Associate Companies .................166
> Responsibility Statement ................................................................180
Contents
3
Letter from the Chairman
Dear shareholders,
You are holding the Annual Report of Enel Américas S.A.
corresponding to the year 2017. In this document you
will find the main milestones of the Company in a year
of intense activity, and in which we have made great
progresses in the consolidation of our business strategy.
Before going through some of these milestones, I would
like to thank the Members of the Board of Enel Américas,
whom in 2016 gave me their trust and responsibility to chair
the Company, placing their confidence in my management.
Their dedication, honesty, kindness and efficiency in
their work have been crucial for the development of the
company. 2017 was challenging and a year of intense
work, in which every employee of the Company has made
a contribution. I would like to acknowledge this gratitude to
the executives, professionals, technicians and employees
working in the different subsidiaries of the Company for
their commitment and hard work. I particularly thank the
Chief Executive Officer of Enel Américas, Luca D’Agnese,
who has leaded successfully the most important private
electricity company of the Region.
The Company’s positioning has been the result of a
conscious and ongoing effort that we are very proud of,
but at the same time imposes the challenge of maintaining
and consolidating this position in the long term. We will
continue embracing this task through a rigorous work, and
with special attention to the search of new opportunities
that will provide continuity to the achievements carried out
during 2017.
4
Annual Report Enel Américas 2017 Industrial Growth
In terms of industrial growth, 2017 was a very good year,
because the Company increased its regulatory asset base
in more than US$2,300 million, thus strengthening its
development in the distribution business in the different
counties where the entity operates in the region.
We faced in Argentina the implementation of a new
regulatory framework in the distribution business. This new
institutionalism meant a major turnaround in the business
opportunities that we have had in this country, opening
new alternatives and the possibility to carry out important
investments in the next three years for the improvement of
the quality of the distribution networks.
We also had a positive year in Brazil, mainly in the distribution
business. In March 2017 the concession contract for Enel
Distribución Río was renewed and improved, in line with
the expectations of the Company.
I would also like to highlight the industrial non-organic
growth: this year in Brazil we completed the acquisition
of the distribution company Celg, currently known as Enel
Distribución Goiás, which perfectly fits in the growth strategy
of Enel Américas, adding 2.9 million clients to our clients’
base. We are working in this company’s improvement and
efficiency processes, which will contribute to accelerate
the expected financial and operational results. Also in
Brazil, in the generation business we acquired Volta Grande
hydroelectric power plant, adding 380 MW to our installed
capacity, along with the consolidation of our generation
portfolio in this country.
Meanwhile in Peru, we acquired 7.5% ownership of
Enel Distribución Perú to our minority shareholders. The
transaction was performed in the Lima Stock Exchange and
amounted to the equivalent of US$ 80.5 million. Therefore
our total shareholding reached 83.2% of the Company’s
equity. This operation is part of our strategy of acquisition
of minority holdings.
In this growth drive, we continue the permanent search of
new opportunities of acquisition in the Region, especially
in those markets that offer greater development, stability
and compensation opportunities.
5
Letter from the Chairman
Efficiencies and
Simplification of
the Group
Results of the period
In term of results, despite the context of volatility that
existed in the Region during the year, Enel Américas has
showed great economic and financial strength and provided
As we know, one of the key issues of our corporate strategy
very positive results to its shareholders, both in terms of
is the implementation of the corporate simplification plan.
EBITDA and Net Income, in line with the commitments
Therefore, and in line with our commitment announced in
announced last year in the Strategic Plan.
2016, Enel Américas reduced its corporate structure from
43 to 34 subsidiaries.
The Company’s EBITDA increased 21.3% during the period
in relation to the previous year. The new result amounted to
In order to reach such purpose correctly and with the
US$ 1,127 million, representing an 11% growth compared
objective of rationalizing and simplifying the corporate
to the previous year. Isolating the extraordinary effects,
structure in these countries, important transactions were
such increase reached 33% in relation to the same period
carried out in Peru and Brazil
in 2016.
Regarding the challenging efficiency plan announced by
the company, which has been our priority since 2016, we
can emphasize that during 2017 we materialized 102% of
the efficiencies that were committed in the Strategic Plan
2016-2019, reaching US$364 million.
6
Annual Report Enel Américas 2017
Sustainability is
the central axis of
our business
I would like to finish this letter by expressing my gratitude
to the Directors, executives, professionals, technicians
and employees of Enel Américas for their permanent
dedication and efforts made in 2017. All of them have been
an essential part on each step made by this Company.
So now I invite you to renew our commitment to follow
this path, to continue leading the industry and to make a
We are convinced that the incorporation of sustainability
positive contribution to the development of our company.
policies to the business chain generates value, both to
Thank you.
the shareholder and to the company. In this respect, the
progress made during 2017 has allowed Enel Américas’
projects to benefit more than 538 thousand people in
the four countries where we operate. This work was also
reflected in the two certifications received in 2017: the
entry of Enel Américas in the Dow Jones Sustainability
Chile Index and the FTSE4Good Index, representing world-
Francisco de Borja Acha Besga
level references in this field, and of which we feel specially
Chairman
proud of.
As we have seen, our Company is going through a positive
development cycle, with achievements that consolidate
our growth and stability. This is without a doubt a cause
for satisfaction, but at the same time means to assume
great responsibilities at present and in the future, while
maintaining our high standards of corporate behavior, and
being able to combine competition, skills and ethics in the
development of our business.
7
Letter from the Chairman Enel Américas is Open Power
The strategic concept of Open Power means openness to
time in Enel, we have identified a “galaxy” comprised by
the outside world, to technology and internally between
a Vision that represents the great long term objective, a
colleagues. In order to completely communicate to our
Mission 2025 declared in five items, values that represent
clients, our counterparts, the essence of a new and
the DNA of Enel and ten behaviors that should inspire
innovative Enel, it’s important to share this attitude of
every person working at the company. Together we will
openness inside the company. In order to create a common
discover the Open Power galaxy.
culture between the Group’s different realities, for the first
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Milestones in 2017
JANUARY
Enel Distribución Perú
i n a u g u r a t e d p u b l i c
lighting with LED lights
Through an agreement
b e t w e e n E n e l
Distribución Perú and
the Municipality of La
Punta, this area became
a pioneer in Peru using
LED technology for public
lighting. This system
is much more efficient
i n t e r m o f l u m i n o u s
e f f i c i e n c y, a n d i t s
duration is twice higher
than any other traditional
sodium lighting.
10
Enel Distribución Perú
participated in a project
to remove pollutant
substances
T h e M i n i s t r y o f
H e a l t h i n Pe r u a n d
t h e U n i t e d N a t i o n s
Industrial Development
Organization (UNIDO)
a c k n o w l e d g e d t h e
c o m p a n y f o r i t s
active and volunt ar y
p a r t i c i p a t i o n i n t h e
Environmentally Rational
Handling and Disposal of
Polychlorinated Biphenyls
(PCB) Project executed in
the period 2010-2017.
MAY
The energy service
o f B o g o t á w a s
distinguished among
the most competitive
in Colombia
Two reports issued by
the Superintendence
o f D o m e s t i c P u b l i c
Services acknowledged
that the energy service
provided by Codensa
in Bogotá is one of the
most competitive in
the country. During the
first months of the year,
the company remained
as the second entit y
with the lowest tariff
per kilowatt/ hour and
the second electricity
distribution company
with the best ser vice
q u a l i t y i n d i c a t o r s i n
Colombia.
Emgesa is leader in
energy sales through
long-term contracts
Emgesa is the generation
company that recorded
more transactions over
5-year term. Long-term
contracts have enabled
the company’s clients
t o p l a n t h e i r e n e r g y
m a n a g e m e n t m o r e
e ff i c i e n t l y a n d fa c e
c o n t i n g e n c i e s w i t h
greater stability, such as
El Niño phenomenon.
MARCH
Successful local bond
issue of Codensa
Codensa performed a
successful bond issue
in the Colombian capital
market amounting to
COP$ 430,000 million at
2 and 5-year term. This
issuance was registered
under the Bond Issuance
and Placement program
approved by the Financial
S u p e r i n t e n d e n c e o f
Colombia.
Codensa and Emgesa
p r o m o t e d e l e c t r i c
m o b i l i t y t o t h e i r
employees
A s p a r t o f t h e i r
c o m m i t m e n t w i t h
electric mobility, Codensa
and Emgesa created
the ECO CAR program.
This internal initiative
facilitated employees
t o a c q u i r e e l e c t r i c
vehicles. In this first
stage, 20 employees
were benefitted with
the acquisition of electric
vehicles and received
support and advisor y
from the companies
for the installation of
i n d i v i d u a l ch a r g i n g
points at their homes.
A d d i t i o n a l l y, t h e s e
companies installed five
charging points in their
headquarters for the use
by employees during
their working hours.
FEBRUARY
A p p r o v a l o f t h e
Integral Tariff Review in
Argentina
O n F e b r u a r y 1 , i n
Argentina the National
Electricity Regulatory
Entity (ENRE) approved
the Integral Tariff Review,
known as RTI, which
established a structural
change in the energy
distribution sector in the
country.
Enel completed the
acquisition of CELG
(now Enel Distribución
Goiás)
On Februar y 14, Enel
Américas, through its
subsidiary Enel Brasil,
completed the acquisition
of approximately 94.8%
o f C e l g D i s t r i b u ç ã o
S.A. share capital. This
company operates in
the Brazilian region of
Goiás. The amount of the
operation reached BRL$
2,187 million.
Codensa announced a
tariff reduction
While the last milestone
of the merger process of
Empresa de Energía de
Cundinamarca (EEC) with
Codensa in Colombia,
a n d a ft e r o b t a i n i n g
the authorization for
integrating the markets
of both companies, since
February 2017 a single
tariff per kilowatt/ hour
was applied for all clients
of the merged company.
Before this, the clients
of EEC paid a higher
tariff per kilowatt/ hour
than the one charged by
Codensa.
Annual Report Enel Américas 2017 Enel Distribución Perú
convened an energy
bidding
The company convened
generation companies to
participate in the energy
supply bidding for free
customers for a total of
100 MW, for the period
between July 2017 and
December 2021. Through
this public tender, Enel
Distribución Perú chose
among those generation
companies that offered
the most advantageous
e c o n o m i c t e r m s fo r
contracted capacity and
energy supply of free
customers.
JULY
Codensa and Emgesa
were acknowledged
f o r a n t i c o rr u p t i o n
practices in Colombia
The companies were
r e c o g n i z e d b y t h e
Presidency’s Secretariat
of Transparency as one of
the six large companies
o f t h e c o u n t r y t h a t
entered in the record
of Anticorruption Active
Companies (EAA in its
Spanish acronym), with
the highest international
s t a n d a r d s i n t h e
compliance of corruption
prevention programs.
B o t h c o m p a n i e s
exceeded the essential
requirements for entering
the register of EAA,
becoming references in
anti-corruption practices
and activities related
with corporate ethics
compliance in Colombia.
Anniversary of Enel
Generación Costanera
E n e l G e n e r a c i ó n
Cost anera turned 24
years of age, being one
o f t h e m a i n t h e r m a l
generation companies
of the Group. This power
plant is located in the
southern seafront of
Buenos Aires.
JUNE
Enel Generación Ceará
received the Abradee
Award
For the eight consecutive
times, the company was
awarded with the first
place in the Corporate
Social Responsibility
categor y by Abradee,
the Brazilian Association
o f E l e c t r i c a l E n e r g y
Distribution.
C o d e n s a c a r r i e d
o u t a n i m p o r t a n t
modernization plan of
the energy substations
With an investment of
COP$ 160,000 million,
Codensa moved forward
its ambitious plan for
the modernization of 27
substations in Bogotá
and Cundinamarca and
improved the quality of
service for its 3,268,564
clients. These works
were carried out without
any service interruption
and didn’t impact any
clients.
Codensa and Emgesa
committed with new
s t a n d a r d s i n t h e i r
sustainability reports
B o t h c o m p a n i e s
p a r t i c i p a t e d i n t h e
launching of new GRI
S t a n d a r d s , w h i c h
w e r e u p d a t e d b y
the Global Reporting
Initiative, which define
t h e s t a n d a r d s f o r
sustainability reports
worldwide. The objective
of updating of these
rules is to adapt the
companies to the Paris
Agreement and to the
Objectives of Sustainable
D eve l o p m e n t o f t h e
U n i t e d N a t i o n s . Th e
Enel Group committed
to specifically support
four of them: quality
e d u c a t i o n , a c c e s s
to energy, economic
development and fight
against climate change.
Successful local bond
issue of Codensa for
COP$ 200,000 million
Codensa carried out
successfully a bond issue
in the Colombian market
for COP$ 200,000 million
a t 7- ye a r t e r m . Th i s
issuance was registered
under the Bond Issuance
and Placement program
approved by the Financial
S u p e r i n t e n d e n c e o f
Colombia.
Milestones in 2017
11
Milestones in 2017
New power substation
in Peru benefits more
t h a n 2 5 t h o u s a n d
clients
Enel Distribución Perú
commissioned the new
Filadelfia Transmission
Electric Substation (SET
in its Spanish acronym),
l o c a t e d i n t h e S a n
Martín de Porres district.
This service operates
in 60 kV benefits more
than 25,000 residential,
commercial and industrial
clients of San Martín de
Porres, Los Olivos and
Callao. The reliability in
the electricity supply
has improved in these
districts. Additionally,
it will meet the energy
demand of the future
Line 2 of Lima Subway.
Investments needed
for its construction and
n e t wo r k i n s t a l l a t i o n
exceeded 20 million
dollars and were carried
out during 15 months.
SEPTEMBER
E n e l A m é r i c a s wa s
included in the Dow
Jones Sustainability
Chile Index
For the first time the
company became listed
o n t h e D o w J o n e s
S u s t a i n a b i l i t y I n d ex
(DJSI) in the category
DJSI Chile. This index
looks annually at the
performance of 2,500
large companies listed in
the most important stock
exchanges worldwide.
Enel Américas became
listed for the first time
i n t h e F T S E 4 G o o d
Emerging Index
This index belongs to the
FTSE4Good, and includes
companies listed in stock
exchanges worldwide
that comply with the
highest environmental,
s o c i a l r e l a t i o n s h i p s
and governance global
s t a n d a r d s , b a s e d
on the principles for
responsible investment.
The FTSE4Good criteria
are applied to the FTSE
Emerging Index launched
in 2016, gathering 20
emerging countries.
E n e l A m é r i c a s wa s
awarded the concession
to operate Volta Grande
power plant in Brazil for
30 years
The concession was
granted in the public
t e n d e r “ L e i l ã o d e
C o n c e s s õ e s n ã o
prorrogadas” arranged
by the Brazilian federal
government through
the Brazilian Agency of
Electricity Regulation
(ANEEL for the Brazilian
a b b r e v i a t i o n ) . E n e l
Américas paid nearly
B R L $ 1 , 4 2 0 m i l l i o n
(equivalent to US$ 445
million), being in line
with the current Group’s
strategic plan.
Edesur celebrates its
25th anniversary
On September 1, Enel’s
distribution company in
Argentina reached the
age of 25 and celebrated
with its employees. With
a total of 18 TWh/ year,
Edesur ser ves nearly
2,5 million clients in the
cit y of Buenos Aires
and 12 municipalities
in the southern area of
the province of Buenos
Aires. Only in 2017, the
company invested ARS$
4 , 0 0 0 m i l l i o n i n t h e
electricity network.
OCTOBER
E n e l A m é r i c a s
i n c r e a s e d i t s
participation in Enel
Distribución Perú
O n O c t o b e r 4 , E n e l
A m é r i c a s t h r o u g h
its subsidiar y in Enel
Perú SAC increased an
additional 7.5% share
in the share capital of
Enel Distribución Perú.
This transaction was
performed in the Lima
S t o ck E x ch a n g e f o r
an amount equivalent
to US$ 80.5 million.
S u b s e q u e n t l y, t h e
participation of Enel
Group in the distribution
company reached 83.2%
of the company’s share
capital.
Codensa and Emgesa
turned twenty years of
operations
Together with the Enel
Group, Codensa and
E m g e s a c e l e b r a t e d
t w e n t y y e a r s o f
ex i s t e n c e , i n w h i ch
t h ey h ave d e c i d e d l y
c o n t r i b u t e d t o t h e
p r o g r e s s o f t h e
energy sector and the
d eve l o p m e n t o f t h e
c o m m u n i t i e s w h e r e
they operate, through the
generation, distribution
and commercialization of
electrical energy. During
t h e s e t wo d e c a d e s ,
t h e s e c o m p a n i e s
h ave r e m a r k a b l e fo r
being financially and
socially responsible,
for its environmental
commitment, innovation
and proximity with their
clients.
AUGUST
Enel was awarded with
the National Innovation
Award in Brazil
E n e l B r a s i l w a s
recognized in the most
important category of
the National Innovation
Award, organized by the
National Confederation
of Industry – CNI and
the Brazilian Service for
the Support of Micro and
Small Companies (Sabra
in its Brazilian acronym).
The awards ceremony
t o o k p l a c e o n J u n e
26 during the opening
session of the Brazilian
Congress of Innovation
in São Paulo. Nearly 4
thousand companies
register to participate
and 34 of them were
shortlisted. Enel was
also one of the three
finalists in the Innovation
and Marketing category.
Anniversary of Enel
Generación El Chocón
T h e h y d r o e l e c t r i c
p owe r p l a n t o f E n e l
Argentina, located in
the Neuquén province,
is a symbol of strength.
El Chocón village grew
and developed around
t h e c o m p a n y t h a t
contributes with 1,200
MW to the International
Interconnected System.
The concession was
granted on August 11,
1993, and in 2017 turned
24 years old.
12
Annual Report Enel Américas 2017 Pompeya Substation
Edesur inaugurated the
repowering works at the
Pompeya Substation,
benefitting 36 thousand
clients. The company,
s u b s i d i a r y o f E n e l
A m é r i c a s , i n v e s t e d
ARS$ 208 million. The
c e r e m o n y c o u n t e d
with the participation
o f t h e g l o b a l h e a d
of infrastructure and
networks of Enel Livio
G a l l o ; t h e g e n e r a l
m a n a g e r o f E d e s u r
Giuseppe Fanizzi; the
Chairman of the company
Juan Carlos Blanco and
the country manager of
Enel Argentina Maurizio
Bezzeccheri.
Enel Distribución Perú
installs more than 8,700
smart meters in Lima
and Callao
Th e e q u i p m e n t wa s
installed in seven districts
at Lima and Callao as
part of the pilot plan to
create a more efficient
and digitized electricity
n e t w o r k f o r t h e
improvement of quality of
service. The company will
carry out investments in
this project for a total
amount of US$1.1 million,
including the installation
of 10,000 meters by the
end of the first quarter
of 2018. The objective
is to show the benefits
of this technology and
t o p e r f o r m a s m a r t
management of energy
to clients and to the
whole power system.
Substation Padre Novak
The substation Padre
N o v a k w a s b u i l t i n
Florencio Varela area, one
of the most important
w o r k s o f E d e s u r t o
relieve the area and
improve transmission
and distribution capacity.
In October a new 40
MVA transformer and
medium voltage wires
were inst alled, thus
improving the service
to our clients and easing
the demand of Varela
Substation.
Opening of machines in
Costanera
The tuning process of
one of the combined
c y c l e s o f E n e l
Generación Costanera
started, which is part
of the maintenance of
machinery for its optimal
operation.
NOVEMBER
Emgesa won the award
o f e x c e l l e n c e A R L
SURA
The company received
t h i s r ewa r d s t h a n k s
to the innovation plan
based on improvements
of lighting and facilities
to install, operate and
maintain public lighting
at the Cartagena Power
Plant Port Society. This
project works with a
retractable posts system
that eliminates the risk
of works in heights to
employees that handle
lights.
Smart Meters
Edesur begun to digitize
the network with the
inst allation of 5,0 0 0
smart meters. During
N ove m b e r C a b a l l i t o
n e i g h b o r h o o d w a s
covered, one of the most
densely populated areas.
This new generation
o f S m a r t M e t e r s
allows the detection
of interruptions in real
time and to accurately
measure consumption
and the energy boost to
the network.
DECEMBER
First charging station
for electric vehicles in
Argentina
E n e l i n s t a l l e d t h e
first charging station
fo r e l e c t r i c ve h i c l e s
in the countr y at the
headquarters of Edesur.
As such, the company
reaffirmed its leadership
in energy innovation,
electric mobilit y and
p r o t e c t i o n o f t h e
environment.
W o r k s o f e l e c t r i c
infrastructure will take
place in Villa Olímpica
in Argentina
T h e Yo u t h O l y m p i c
G a m e s 2 018 w i l l b e
h e l d a t V i l l a S o l d a t i
neighborhood in Buenos
A i r e s . Th e c o m p a ny
i n s t a l l e d m e d i u m
voltage lines and new
transformer chambers
fo r o n e o f t h e m o s t
important sport events
of the year.
Installation of Smart
Meters in Argentina
5 0 s m a r t m e t e r s
were installed in Los
Piletones neighborhood
as part of a pilot plan,
where a dining area of
Margarit a Barrientos
Foundation is located.
As such, the company
promotes technological
p r o g r e s s i n a l o w -
income neighborhood
and cooperates with its
development.
Milestones in 2017
13
04Main financial
and operational indicators
14
Annual Report Enel Américas 2017 15
Letter from the Chairman Total Assets
13,317,834
15,177,664
15,921,322
15,449,154
11,281,556
20,168,990
As of December 31 of each year (1)
2012
2013
2014
2015
2016
2017
Total Liabilities
6,354,065
6,670,199
7,642,104
7,259,346
6,006,307
11,890,483
Operating Revenues
6,577,667
6,264,446
7,253,876
5,301,440
5,197,286
10,540,327
1,982,924
2,251,489
2,300,020
1,615,112
1,643,369
2,947,261
377,351
658,514
610,158
661,587
383,060
709,043
0.99
0.91
1.31
0.78
1.23
0.92
1.01
0.65
1.25
1.14
0.92
1.44
As of December 31 of each year
2012
2013
2014
2015
2016
2017
501
20
3,652
11,207
11,852
197
13
987
5,183
7,291
517
30
2,914
13,251
16,304
263
25
1,657
8,570
9,587
1,478
88
9,210
38,211
45,034
628
25
4,522
14,422
16,549
200
13
987
4,992
6,826
563
29
2,925
12,748
16,090
316
27
1,842
8,489
9,497
1,707
94
10,276
40,651
48,962
645
25
4,522
14,390
15,276
208
13
987
5,225
7,108
589
32
3,059
13,559
15,773
324
27
1,949
9,062
9,916
1,766
97
10,517
42,236
48,073
657
25
4,522
15,204
15,770
194
13
987
4,398
6,541
484
36
3,459
13,705
16,886
292
27
1,983
8,801
9,283
1,627
101
10,951
42,108
48,480
632
29
4,419
13,124
13,312
185
13
974
3,665
9,448
551
36
3,457
14,952
18,015
310
27
1,934
8,698
9,800
1,678
105
10,784
40,439
50,575
578
29
4,419
14,825
14,852
146
17
1,354
4,034
12,587
604
34
3,467
14,765
18,156
320
27
1,979
7,430
10,457
1,648
107
11,219
41,053
56,051
Ebitda
Net Income (2)
Liquidity Ratio
Leverage(3)
Generation Business
ARGENTINA
Number of employees
Number of generating units
Installed capacity (MW) (4)
Electricity generated (GWh)
Energy sales (GWh)
BRAZIL
Number of employees
Number of generating units
Installed capacity (MW) (4)
Electricity generated (GWh)
Energy sales (GWh)
COLOMBIA
Number of employees
Number of generating units
Installed capacity (MW) (4)
Electricity generated (GWh)
Energy sales (GWh)
PERU
Number of employees
Number of generating units
Installed capacity (MW) (4)
Electricity generated (GWh)
Energy sales (GWh)
TOTAL
Number of employees
Number of generating units
Installed capacity (MW) (4)
Electricity generated (GWh)
Energy sales (GWh)
16
Annual Report Enel Américas 2017 Distribution Business
ARGENTINA
Energy sales (GWh)(5)
Number of customers
Energy losses
Number of employees
Clients / employees
BRAZIL
Energy sales (GWh) (5)
Number of customers
Energy losses
Number of employees
Clients / employees
COLOMBIA
Energy sales (GWh) (5)
Number of customers
Energy losses
Number of employees
Clients / employees
PERU
Energy sales (GWh) (5)
Number of customers
Energy losses
Number of employees
Clients / employees
Total
Energy sales (GWh) (5)
Number of customers
Average energy losses
Number of employees
Clients / employees
As of December 31 of each year
2012
2013
2014
2015
2016
2017
17,338
18,137
17,972
18,492
18,493
17,736
2,388,675
2,444,013
2,464,117
2,479,559
2,504,558
2,529,307
10.6%
2,948
810
10.80%
10.75%
12.30%
12.04%
12.04%
3,320
736
3,823
645
4,142
596
4,290
584
4,251
595
20,694
21,767
22,842
22,776
22,809
34,876
6,050,522
6,301,582
6,500,500
6,754,327
6,943,600
9,974,471
16.30%
16.10%
16.42%
17.30%
16.10%
15.22%
2,382
2,540
2,370
2,659
2,415
2,732
2,348
2,877
2,244
3,237
3,336
2,990
13,364
13,342
13,660
13,946
13,632
13,790
2,712,987
2,686,919
2,772,376
2,865,159
3,248,447
3,340,457
7.50%
1,127
2,407
7.00%
1,036
2,594
7.19%
1,043
2,658
7.30%
947
2,771
7.10%
1,337
2,430
7.84%
1,376
2,428
6,863
7,045
7,338
7,624
7,782
7,934
1,203,061
1,254,624
1,293,503
1,336,610
1,367,044
1,396,966
8.20%
607
1,982
7.90%
616
2,037
7.95%
619
2,090
8.30%
570
2,191
7.80%
620
2,216
8.24%
588
2,376
58,259
60,291
61,812
62,838
62,715
74,337
12,355,245
12,687,138
13,030,496
13,435,655
14,063,649
17,241,201
10.65%
10.45%
10.58%
11.30%
10.76%
12.30%
7,064
1,749
7,342
1,728
7,900
1,649
8,007
1,678
8,491
1,656
9,551
1,805
(1) Accounting figures are in accordance to the instructions and regulations issued by the CMF. Figures are presented in million Chilean
nominal pesos for the years 2012, 2013, 2014, 2015 and 2016, and figures are in million dollars for 2017. The Extraordinary Shareholders
Meeting held on April 27, 2017 approved the change of functional currency of the Company from Chilean pesos to US dollars.
(2) Net Results attributable to the dominant company.
(3) Total Liabilities/ Equity plus Minority Interest.
(4) In contrast to the previous years, net installed capacity is considered for the years 2016 and 2017, and the difference with gross installed
capacity is the discount for self-consumption.
(5) Due to changes in the criteria, non-billable consumptions (CNF) are not included in 2014, 2015, 2016 and 2017.
Main financial and operational indicators
17
05Identification of the company
and constituent documents
18
Annual Report Enel Américas 2017 19
Letter from the Chairman Identification of the company
Name or company name
Enel Américas S.A.
Domicile
Type of company
Rut
Address
Postal code
Phones
P.O. Box
Santiago de Chile, being able to establish agencies or subsidiaries in other parts of the country or abroad
Publicly traded company
94,271,000-3
Santa Rosa Nº 76, Santiago, Chile
833-009 SANTIAGO
(56-2) 2353 4400 - (56-2) 2378 4400
1557, Santiago
Securities Registration number
Nº 175
External Auditors
Ernst & Young
Subscribed and paid-in capital (Th$)
6,763,204,424(1)
Web site
Email
www.enelamericas.com
comunicacion.enelchile@enel.com
Investor Relations phone
(56-2) 2353 4682
Ticker symbol in Chilean stock exchanges
ENELAM
Ticker symbol in New York stock exchange ENIA
ADR’s Custodian Bank
ADR’s Depositary Bank
Banco Santander Chile
Citibank N.A.
Local credit rating agencies
Feller Rate Clasificadora de Riesgo Limitada, Fitch Chile Clasificadora de Riesgo Limitada
International credit rating agencies
Fitch Ratings, Moody’s Investor Services y Standard & Poor´s International Rating Services
(1) The Extraordinary Shareholders’ Meeting held on April 27, 2017 agreed the change of the Company’s functional currency from Chilean pesos
to US dollars, and therefore the modification of the articles five permanent and one transitory of the Company’s by-laws.
Constituent Documents
The company that gave rise to Enel Américas S.A.
On August 1, 1988, the company’s name was changed to
was formed initially under the name Compañía Chilena
Enersis S.A.
Metropolitana de Distribución Eléctrica S.A. by public
deed dated June 19, 1981, granted by the notary Patricio
In April 2015 Enersis S.A. started a corporate reorganization
Zaldívar Mackenna in Santiago, and modified by public
process. As part of this process, on December 18, 2015
deed on July 13 the same year and in the same notary. The
the Company’s Extraordinary Shareholders Meeting was
company’s incorporation was authorized and its bylaws
held, where shareholders of Enersis S.A. approved the
approved by Resolution 409-S of July 17, 1981 of the
first stage of the reorganization process called “the Spin-
Securities and Insurance Commission (SVS). The extract of
off”. Therefore, the Spin-off of the Company was approved,
the incorporation authorization and approval of the bylaws
and the entity “Enersis Chile S.A.” was created, which
was registered in the Santiago Trade Registry on page
represented the unique vehicle for the control of generation
13,099 Nº7,269 for the year 1981, and were published in
and distribution assets that the Group owns in Chile and,
the Official Gazette of July 23, 1981. The bylaws of Enel
the former Enersis S.A. was named “Enersis Américas
Américas S.A. have undergone a number of modifications
S.A.”, which controls the businesses in the other countries
ever since.
20
Annual Report Enel Américas 2017 of the region (Argentina, Peru, Brazil and Colombia). The
the Commerce Registry in 2016 of the Property Register
Spin-off was formalized in a public deed of January 8, 2016,
in Santiago and was published in the Official Journal on
granted in the Notary Iván Torrealba Acevedo in Santiago,
October 29, 2016.
whose excerpt was registered on pages 4013 N° 2441 of
the Commerce Registry in 2016 of the Property Register
The Company’s purpose is to perform in the country
in Santiago and was published in the Official Journal on
or abroad
the exploration, development, operation,
January 22, 2016. A supplementary extract was registered
generation, distribution,
transmission,
transformation
on pages 10.743 N° 6.073 in the same Registry, year and
and/ or sales of energy in any of its forms and nature,
the Property Register and was published in the Official
or directly or through intermediate companies, likewise,
Journal on February 10, 2016.
and also telecommunications activities and the provision
of engineering consultancy in the country and abroad. It
The Extraordinary Shareholders Meetings of Enersis
may also invest and manage its subsidiaries and associate
Américas S.A. and its subsidiaries Endesa Américas S.A.
companies, whether generators, transmission companies,
and Chilectra Américas S.A. were held on September 28,
distributors or traders of electricity or whose business
2016. Among other topics, at these meetings the second
is any of the following: (i) energy, in any of its forms or
stage of the corporate reorganization plan denominated
nature, (ii) the supply of public utilities or whose main raw
“The Merger” was approved. Therefore, Enersis Américas
material is energy, (iii) telecommunications and information
S.A., the absorbing entity, acquired all the assets and
technology, and (iv) trading over internet. In complying with
liabilities of the subsidiaries Chilectra Américas S.A. and
its main objects, the company will carry out the following
Endesa Américas S.A., succeeding them in every right and
functions:
obligation and incorporating to Enersis Américas S.A. the
entirety of shareholders and equity of Chilectra Américas
a) Promote, organize, build, modify, dissolve or liquidate
S.A. and Endesa Américas S.A.
companies of any nature, which have similar corporate
objects to its own.
In addition, it was agreed that after the Merger, on
b) Propose investment, financing and business policies to
December 1, 2016, Enersis Américas S.A would change its
subsidiary companies, as well as accounting criteria
name to “Enel Américas S.A.”. Such meeting was formalized
and systems that these should follow.
in a public deed of October 18, 2016, granted in the Notary
c) Supervise subsidiary management.
Iván Torrealba Acevedo, whose excerpt was registered on
d) Provide subsidiary or associate companies with the
pages 79,974 N°43,179 of the Commerce Registry in 2016
necessary financing for their business development and
of the Property Register in Santiago and was published in
provide management services; financial, technical, legal
the Official Journal on October 29, 2016.
and auditing advice; and in general any type of service
Corporate
Purpose
The corporate purpose of the Company is stated in the
statutory modification approved by the Extraordinary
Shareholders Meeting held on September 28, 2016,
formalized in a public deed of October 18, 2016, granted
in the Notary Iván Torrealba Acevedo in Santiago, whose
excerpt was registered on pages 79,974 N°43,179, of
that appears necessary for their best performance.
In addition to its main objects and always acting within the
limits established by the Investment and Financing Policy
approved by the Shareholders Meeting, the Company may
invest in:
1.- The acquisition, operation, construction,
rental,
administration, intermediation, trading and disposal
of all kinds of movable and immovable assets, either
directly or through subsidiaries or associate companies.
2.- All kinds of financial assets, including shares, bonds and
debentures, commercial paper and in general all kinds
of titles or securities and company contributions, either
directly or through subsidiaries or associate companies.
21
Identification of the Company and Constitutive Documents 06Property and control
22
Annual Report Enel Américas 2017 23
Letter from the Chairman Ownership Structure
Ownership structure
The company capital is divided into 57,452,641,516 shares, with no nominal value, all holds the same single series and
each share represents one voting right, and there are no state-owned preferred shares.
As of December 31, 2017, all shares were subscribed and paid-in, and were distributed as follows:
Shareholders
Enel S.p.A.
Pension Funds
ADR´S (Citibank N.A. according to circular N°1,375 of the SVS)
Foreign Investment Funds
Custodian banks
Stockbrokers, insurance companies, mutual funds
Other shareholders
Total Shares
Number of shares
Shareholding
29,762,213,531
8,606,567,373
5,064,445,978
90,124,898
8,605,676,521
3,795,006,987
1,528,606,228
51.80%
14.98%
8.81%
0.16%
14.98%
6.61%
2.66%
57,452,641,516
100.00%
Identification of Controllers
As defined in Title XV of Law No. 18,045, Enel Américas S.A. is a publicly traded company directly controlled by Enel S.p.A.,
an Italian joint stock company, owning 51.8030% of the shares issued by Enel Américas S.A.
Shareholders of Enel S.p.A
Ministero dell’Economia e delle Finanze de Italia
BlackRock Inc.
Other Investors (Institutional and Retail)
Total
The controller’s members don’t have a joint action agreement.
23.6%
5.6%
70.8%
100.0%
24
Annual Report Enel Américas 2017
List of the Twelve Main Shareholders
of the Company
As of December 31, 2017, 23,973 shareholders owned Enel Américas. The twelve main shareholders were:
Name or Company Name
Enel S.p.A.
Citibank N.A. as per S.V.S. Circular 1,375
Banco de Chile on behalf of non-resident third parties
Banco Itaú Corpbanca on behalf of foreign investors
Rut
Number of
Shares
Shareholding
59,243,980-8
29,762,213,531
51.80%
59,135,290-3
97,004,000-5
97,023,000-9
5,064,445,978
3,895,552,189
2,523,158,948
Banco Santander on behalf of foreign investors
97,036,000-K
1,883,016,703
AFP Provida S.A. for Pension Fund C
AFP Capital S.A. for Pension Fund C
AFP Habitat S.A. for Pension Fund C
AFP Cuprum S.A. for Pension Fund C
AFP Cuprum S.A. for Pension Fund A
Banchile C. de B. S.A.
AFP Habitat S.A. for Pension Fund A
Subtotal twelve major shareholders
Other 23,961 shareholders
TOTAL 23,973 SHAREHOLDERS
76,265,736-8
98,000,000-1
98,000,100-8
76,240,079-0
76,240,079-0
96,571,220-8
98,000,100-8
1,305,331,772
981,480,577
959,169,297
853,871,456
496,246,910
495,159,971
467,088,142
48,686,735,474
8,765,906,042
57,452,641,516
8.81%
6.78%
4.39%
3.28%
2.27%
1.71%
1.67%
1.49%
0.86%
0.86%
0.81%
84.74%
15.26%
100.00%
There are no shareholders representing the founding families of the Company neither related to the government or state
entities owning shares exceeding 5% ownership.
Property and control
25
Most Significant Changes in Ownership
During 2017, the most important changes in the ownership of Enel Américas are the following:
Name or Company Name
Rut
Dv
Number of
shares on
12/31/2016
Number of
shares on
12/31/2017
Variation %
Number
of Shares
Variation
Citibank N.A. as per SVS Circular 1,375
Banco de Chile on behalf of non-resident third parties
AFP Provida S.A.
Banco Itaú Corpbanca on behalf of foreign investors
AFP Capital S.A.
AFP Cuprum S.A.
Banco Santander on behalf of foreign investors
AFP Habitat S A
Banchile C.de B. S.A.
AFP Modelo S.A.
AFP Planvital S.A.
Larraín Vial S.A. Corredora de Bolsa
BTG Pactual Chile S.A. C. de B.
59,135,290
97,004,000
76,265,736
97,023,000
98,000,000
76,240,079
97,036,000
98,000,100
96,571,220
76,762,250
98,001,200
80,537,000
84,177,300
Banco Santander-HSBC Bank PLC London Client Account
97,036,000
Santander Corredores de Bolsa Limitada
Valores Security S.A. C. de B.
96,683,200
96,515,580
3
5
8
9
1
0
K
8
8
3
K
9
4
K
2
5
5,631,047,778 5,064,445,978
-0.9862% -566,601,800
4,108,765,679 3,895,552,189
-0.3711% -213,213,490
2,623,011,837 2,278,366,257
-0.5999% -344,645,580
2,508,359,677 2,523,158,948
0.0258% 14,799,271
1,878,800,411 1,995,066,955
0.2024% 116,266,544
1,804,422,529 1,780,798,933
-0.0411% -23,623,596
1,696,564,437 1,883,016,703
0.3245% 186,452,266
1,481,560,005 1,797,479,247
0.5499% 315,919,242
450,500,908
495,159,971
0.0777% 44,659,063
289,374,853
468,847,590
0.3124% 179,472,737
286,867,719
286,008,391
-0.0015%
-859,328
283,130,396
290,453,220
0.0127%
7,322,824
232,232,906
203,106,375
-0.0507% -29,126,531
219,688,777
198,136,422
-0.0375% -21,552,355
206,736,414
216,115,682
0.0163%
9,379,268
138,540,854
159,927,049
0.0372% 21,386,195
26
Annual Report Enel Américas 2017
Exchange Transactions Performed by
Related Individuals during 2016 and 2017
No exchange transactions between related individuals were made during 2016 and 2017.
Summary of Directors’ Committee and
Shareholders Comments and Proposals
Enel Américas S.A. received neither comments nor proposals with regards to the progress of company business between
January 1 and December 31, 2017 from the Directors’ Committee or Shareholders who own or represent 10% or more
of the shares issued with voting rights as stated in Articles 74 of Law No. 18,046 and 136 of the Regulation to Public
Companies.
Property and control
27
07Administration
28
Annual Report Enel Américas 2017 29
Letter from the Chairman Board of Directors
4
1
5
2
6
3
7
1. CHAIRMAN
Francisco de Borja Acha Besga
Degree in Law
Universidad Complutense de Madrid
DNI: 05263174-S
From 04.28.2016
2. DIRECTOR
José Antonio Vargas Lleras
Degree in Law
Universidad Colegio Mayor del Rosario,
Colombia
DNI: 79.312.642
From 04.28.2016
5. DIRECTOR
Hernán Somerville Senn
Lawyer
Universidad de Chile
Master of Comparative Jurisprudence
University of New York
DNI: 4,132,185-7
From 04.28.2016
3. DIRECTOR
Enrico Viale
Engineer Degree
Universidad Politécnica de Turín
MBA Escuela de Negocios
Universidad de Santa Clara
DNI: AU 2580379
From 04.28.2016
4. DIRECTOR
Livio Gallo
Electronic Engineer
Universidad Politécnica de Milán
DNI: AV 0246369
From 04.28.2016
6. DIRECTOR
Domingo Cruzat Amunátegui
Industrial civil engineer
Universidad de Chile
MBA The Wharton School de la Universidad
of Pennsylvania
Rut: 6,989,304-K
From 04.28.2016
7. DIRECTOR
Patricio Gómez Sabaini
Business Administration Degree
George Mason University, Virginia
Master of Business Administration
George Washington University, Washington DC
Passport: 16941675N
From 04.28.2016
30
Annual Report Enel Américas 2017 Enel Américas is managed by a Board of Directors
comprised of seven members, who remain in office
for a three-year period and may be re-elected. The
Board was appointed at the Ordinary Shareholders’
Meeting held on April 28, 2016. According to the
Corporations Law, if a Director’s vacancy occurs,
the whole board shall be renewed at the next
ordinary shareholders’ meeting the corporation shall
hold, and, in the meanwhile, the board may name
a substitute. The Company doesn’t consider any
substitute members.
In the last two years, the following were also
Board of
Directors’ and
Directors’
Committee
Compensations
Directors of Enel Americas:
Francesco Starace
Vice Chairman of the Board
Nuclear Engineer
Universidad Politécnica de Milán
Passport: YA5358349
From 04.28.2015 to 04.28.2016
Francesca Di Carlo
Director
Degree in Economics
Universidad La Sapienza, Roma
Passport: AA2224406
From 04.28.2015 to 04.28.2016
Alberto De Paoli
Director
Degree in Economics
Universidad La Sapienza, Roma
Passport: YA4226864
From 04.28.2015 to 04.28.2016
Rafael Fernández Morandé
Director
Industrial Civil Engineer
Pontificia Universidad Católica de Chile
DNI: 6,429,250-1
From 04.28.2015 to 04.28.2016
Herman Chadwick Piñera
Director
Lawyer
Pontificia Universidad Católica de Chile
Rut: 4,975,992-4
From 04.28.2015 to 04.28.2016
Pursuant to Article 33 of Law No. 18,046 Corporations Law,
the Ordinary Shareholders’ Meeting held on April 27, 2017
approved the compensations for the Board of Directors and
Directors’ Committee for the 2017 accounting period. The
compensations for the Directors’ Committee consist on an
annual variable remuneration equal to one per thousand of the
net profits of the period.
As an advance payment, a monthly compensation was
defined, part of which is at any event and part of it eventually,
and it’s imputable to the aforementioned annual variable
compensation. This compensation is consists on 180 UF
of monthly fixed compensation at any event and 66 UF of
attendance fees per meeting of the Board, up to a maximum
of 15 sessions altogether.
The compensation of the Chairman of the Board will be twice
the compensation of a Director.
The compensation for the Directors’ Committee consists
on an annual variable remuneration equal to cero point one
thousand seven hundred seventy five of the net profits of the
period. It was determined to pay in advance one-month fee,
one part in all events and a variable part, attributable to the
referred variable annual remuneration. This compensation is
consists on 60 UF of monthly fixed compensation at any event
and 22 UF of attendance fees per meeting of the Board, up to
a maximum of 15 sessions altogether.
31
Administration Total compensation expenses in 2017 were US$ 526,856 and are shown in the following table. The Board of Directors did
not incur in any expenses for external consulting services.
2017
Figures in US$
Name
Position
Fixed
Remuneration
Ordinary and
Extraordinary
Sessions
Committee’s
Fixed
Compensation
Committee’s
Ordinary and
Extraordinary
Sessions
Variable
Compensation
TOTAL 2017
Francisco de Borja Acha (1)
Chairman
José Antonio Vargas Lleras (1)
Director
Livio Gallo (1)
Enrico Viale (1)
Hernán Somerville Senn
Director
Director
Director
Domingo Cruzat Amunátegui
Director
Patricio Gómez Sabaini
Director
Total
93,417
93,417
93,417
39,968
37,106
39,968
280,250
117,042
31,139
31,139
31,139
93,417
12,367
11,413
12,367
36,147
-
-
-
-
176,891
173,075
176,891
526,856
(1) Messrs. Francisco de Borja A., José Antonio Vargas Ll., Livio Gallo and Enrico Viale, renounced to any compensation payment.
2016
Total compensation expenses in 2016 were US$ 570,407 and are shown in the following table. The Board of Directors did
not incur in any expenses for external consulting services.
Figures in US$
Name
Position
Fixed
Remuneration
Francisco de Borja Acha (1)
Chairman
José Antonio Vargas Lleras (1)
Vice Chairman
Ordinary and
Extraordinary
Sessions
Committee’s
Fixed
Compensation
Committee’s
Ordinary and
Extraordinary
Sessions
Variable
Compensation
TOTAL 2016
Livio Gallo (1)
Enrico Viale (1)
Hernán Somerville Senn (2)
Director
Director
Director
Domingo Cruzat Amunátegui (2) Director
Patricio Gómez Sabaini (2)
Director
Rafael Fernández Morandé (3)
Director
Herman Chadwick Piñera (3)
Director
84,041
63,293
63,293
27,712
27,712
53,923
43,771
43,771
10,152
10,152
28,010
21,098
21,098
9,234
9,234
17,971
14,590
14,590
3,381
3,381
Total
266,051
161,769
88,673
53,914
-
-
-
-
-
-
183,945
142,752
142,752
50,479
50,479
570,407
(1) Messrs. Francisco de Borja A., José Antonio Vargas Ll., Livio Gallo and Enrico Viale, renounced to any compensation payment.
(2) Messrs. Hernán Somerville S., Domingo Cruzat A. and Patricio Gómez S., assumed their positions at the Board of Directors of Enel
Américas in April 2016.
(3) Messrs. Herman Chadwick Piñera and Rafael Fernández Morandé, held their positions at the Board of Directors until April, 2016.
32
Annual Report Enel Américas 2017
Social Responsibility and
Sustainable Development
Board Diversity
Number of people by gender
Female
Male
Total
Number of people by nationality:
Chilean
Spanish
Argentine
Colombian
Italian
Total
Board of
Directors
Consulting
Expenses
During 2017, the Board of Directors did not make any
expenses in consulting services.
Property
over Enel
Américas
0
4
2
1
7
6
1
7
Number of people by age range:
Between 41 and 50 years old
Between 51 and 60 years old
Between 61 and 70 years old
Over 70 years old
Total
Number of people by seniority:
Less than 3 years
More than 12 years
Total
0
7
7
2
1
1
1
2
7
Directors’
Committee
Pursuant to Article 50 bis of law No. 18,046 Corporations Law, Enel
Américas S.A. has a Directors’ Committee comprised by three
members, with faculties and duties enumerated in said article and
those delegated by the Board as established in the Regulation of the
Director’s Committee.
On January 1, 2017 the Directors’ Committee of Enel Américas S.A.
was comprised by Messrs. Hernán Somerville Senn, Domingo
Cruzat Amunátegui and Patricio Gómez Sabaini, all independent
members of the Board. The Chairman and Financial Expert was
Mr. Hernán Somerville Senn and the Secretary of the Directors’
Committee was Mr. Domingo Valdés Prieto.
At the ordinary session of the Board of Directors held on April 29,
2016 were appointed as members of the Directors’ Committee
Messrs. Hernán Somerville Senn, Patricio Gómez Sabaini and
Domingo Cruzat Amunátegui. Mr. Hernán Somerville Senn was
appointed Financial Expert of the Directors’ Committee. On the
other hand, at the ordinary session of the Directors’ Committee
As of December 31, 2017, according to the
held on April 29, 2016, Mr. Hernán Somerville Senn was appointed
Shareholders’ Register, none of the current
Chairman of the Directors’ Committee and Mr. Domingo Valdés
Directors held ownership of
the company
Prieto, Legal Counsel of the Company, was appointed secretary of
Directors’ Committee.
the committee.
33
Administration Directors’ Committee
Management Annual Report
The Directors’ Committee held thirteen meetings in 2017.
Consolidated Financial Statements of the Company as of
During the sessions held in 2017, the Director’s Committee
Income Statement and Significant Events, and the opinion
addressed subjects regarding their interests, giving due
“without any observation” issued by external auditors on
fulfillment of their obligations dictated by the Article 50
July 26, 2017, signed by Mr. Emir Rahil, partner of Ernst
statue number 18,046 about Public Limited Companies.
& Young. When addressing and presenting the issue, the
June 30 2017, its Notes, Financial Statements Analysus,
1.- Consolidated
Financial Statements
At the ordinary session held on February 24, 2017, the
following documents were unanimously declared to have
been examined; the Consolidated Financial Statements
as of December 31, 2017, its Notes, Financial Statements
and Significant Events, as well as the External Auditor’s
opinions. Likewise, the Chairman of the Director’s
Committee requested the Administration, Finance and
Control Manager to develop a very thorough explanation
to the market regarding the causes of the decrease of
financial results and particularly the situation of Argentina.
Additionally, the Chairman of the Committee, Mr. Hernán
Somerville Senn, reminded that he had requested in
several previous sessions a simplified presentation of the
cash flow to the Committee in several previous sessions,
which has not been presented yet.
At the ordinary session held on March 31, 2017 unanimously
took note of the modifications of the International Financial
Reporting Standards effective from January 1, 2018.
At the extraordinary session held on May 5, 2017, the
Directors’ Committee unanimously, declared to have
examined the Consolidated Financial Statements of
partners of Ernst & Young, also expressed in relation to the
provisions for derivatives and lawsuits, that they have not
identified special situations being a comprehensive part of
the usual reviews carried out in an external audit.
At the ordinary session held on April 27, 2017, the Directors’
Committee unanimously, declared to have reviewed the
Form 20-F and the Consolidated Financial Statements of
the Company contained therein, which is to be presented
before the aforementioned SEC, with the goal of complying
by their norms and requirements issued by said public
authority related with the emission of securities in said
country.
At the ordinary session of October 31, 2017, the
Directors’ Committee unanimously, declared examined
the Consolidated Financial Statements of the Company
as of September 30, 2017, it’s Notes, Income Statement,
Significant Events and the letter concerning the operations
between related parties.
2.- Services provided by
External Auditors and
former employees of
Ernst & Young Review
the Company as of March 31, 2017, it’s Notes, Income
At the ordinary sessions held on February 24, March 31,
Statement and Significant Events.
April 27, May 30, June 28, July 26, August 31, September
28, October 31, November 29 and December 15, all during
At the ordinary session held on July 26, 2017, the
2017, the services provided by external auditors were
Directors’ Committee unanimously declared examined the
analyzed, those that were not from external auditors, and
34
Annual Report Enel Américas 2017 it was agreed to declare that they do not compromise the
The Directors’ Committee declared that the operation
suitable technique nor the independence of judgment of
contributed to the social interest and its price, terms and
the respective external auditing companies. The latter is in
conditions are adjusted to those prevailing in the market
conformity to what is written In Section 202 of the Law
at the moment of its approval. For this purpose the report
Sarbanes Oxley, in article 242, final subsection, of the Law
issued by the independent BDO Finanzas Corporativas S.A.
18.045, of the Value Market and in the Directors Committee
was kept on hand.
Guidelines.
- At the ordinary session held on August 31, 2017 the
- At the sessions of August 31 and October 31, the Directors’
Directors’ declared to have examined the operation
Committee unanimously declared that the hiring of former
between related parties regarding the subscription of an
employees of Ernst & Young doesn’t mean any violation
intercompany contract for the provision of services to Enel
to the Sarbanes Oxley Act neither to local regulation, so
Américas from Enel Green Power North America, for the
there’s no legal impediment to hire them. The same issue
investor relations services in the United States of America
and in the same way was declared at the ordinary session
jurisdiction, in New York city, and declared that the operation
of November 29, 2017, with regards to a former employee
contributed to the social interest and was adjusted in price,
of BDO RCS Auditores Limitada.
terms and conditions to those currently prevailing in the
3.- Operations between
Related Parties Review
At the ordinary session held on May 30, 2017, the Directors’
Committee declared to have examined the operation
between related parties consisting on the intercompany
loan operation of Enel Américas to its subsidiary Enel
Brasil for an amount of USD 154 million, and declared that
such operation contributed to the social interest of Enel
Américas S.A., and its price, terms and conditions are
adjusted to those prevailing in the market at the moment
of its approval.
- At the ordinary session held on July 26, 2017, the
Directors’ Committee declared to have examined the
operation between related parties regarding the capital
increase proposed by the subsidiary Enel Argentina S.A.
and consisting on the contribution of the social participants
of the Enel Américas property in Edesur S.A., Yacilec S.A.,
Enel Generación El Chocón S.A., Enel Generación Costanera
S.A., Enel Trading Argentina S.R.L. and Central Dock Sud
S.A., using for these purposes the valuation of these social
participations carried out by an independent appraiser BDO
Finanzas Corporativas S.A., which is adjusted to the one
performed by the independent appraiser Grant Thornton
in the framework of the aforementioned operation.
market. For this purpose the certification issued by the
Administration, Finance and Control Management was
kept on hand.
- At the ordinary session held on October 31, 2017, the
Directors’ declared to have examined the operation
between related parties regarding an intercompany loan
from Enel Américas to the SPV (Special Purpose Vehicle)
used by Enel Brasil for the acquisition of the concession
of the hydroelectric power plant Volta Grande, of up to
BRL$ 852 million, equivalent to approximately USD 280
million, to be carried out only if needed by the Company,
in a scenario on which the negotiations with banks in
obtaining a bilateral loan don’t proceed in time and form.
The Directors’ Committee declared that this operation
contributed to the social interest of Enel Américas S.A.
and its price, terms and conditions are adjusted to those
prevailing in the market at the moment of its approval.
4.- Supervision
and Evaluation of
External Auditors
At the ordinary session held on February 24, 2017, it was
unanimously agreed that the work performed by the
external auditors of the Company, Ernst & Young, carried
out during the fiscal year 2016 was considered reasonable.
35
Administration 5.- External Auditors
Report on money order
and money brokerage
At the ordinary session held on February 24, 2017, the
Directors’ Committee unanimously agreed to record that they
had received formal and express consent on the report of
money brokerage and money orders prepared by the external
auditors, Ernst & Young, dated February 24, 2017.
6.- Review of the Internal
Control Letter Notice
Nº422 of the SVS
The Superintendence of Securities and Insurance issued
on December 6, 2007 the Notice N° 422, complementing
the Notice N° 980 of December 24, 1990. This Notice gives
specific instructions regarding internal control procedures,
so it provides an interim report and extends the period
indicated in Notice N° 980 for internal auditors to submit
the operations between related parties of the Company,
to which Mr. Rahil responded affirmatively. Mr. Hernán
Somerville Senn continued, and asked in relation to the
acquisition of the Brazilian electricity distribution subsidiary
CELG and particularly regarding the appeals interposed by
the Supreme Court of the Federal State of Brazil, which
was answered by the Chief Executive Officer Mr. Luca
D’Agnese and by Mr. Emir Rahil.
- At the ordinary session held on November 29, 2017, the
Directors’ Committee agreed unanimously to have taken
formal and express knowledge of the Letter of Internal
Control related to Enel Américas S.A., prepared by Ernst
& Young in order to comply with the regulations issued by
the Superintendence of Securities and Insurance (SVS) on
this matter.
7.- Review of the
External Auditors of
Matters Covered in
the NCG Nº385
an internal control final report, indicating that the delivery
At the ordinary session held on February 24, 2017,
should be at the latest as of the date when the Board of
unanimously it was agreed as reviewed by the External
Directors takes notice of the financial statements for the
Auditors the matters referred in paragraph 1 d) of the
period ended December 31 of each year.
General Standard Legislation Nº 385 of the SVS, and it
was declared that none of the matters mentioned in sub-
As such, at the ordinary session held on February 24,
paragraphs ii, iii and v were referred to, of the previously
2017, the Directors’ Committee agreed to have taken
mentioned item have occurred.
formal and express knowledge of the Letter of Internal
Control dated February 24, 2017, prepared by Ernst &
Young in order to comply with the regulations issued by
the Superintendence of Securities and Insurance (SVS) on
this matter. The Director Mr. Domingo Cruzat Amunátegui
consulted Mr. Emir Rahil if Ernst & Young would analyze
the business with the objective of preventing regrettable
cases such as La Polar case, to which Mr. Rahil responded
affirmatively. The Chairman of the Directors Committee
asked Mr. Emir Rahil whether Ernst & Young has reviewed
lawsuits provisions and the situation of derivatives and
8.- External Auditors’ Fees
for the Exercise 2016
At the ordinary session held on February 24, 2017, the
Directors’ Committee unanimously agreed to approve the
fees paid by the companies of the Group during the 2016
exercise, to the different external auditors that the Company
uses.
36
Annual Report Enel Américas 2017 9.- External Audit Contract
between Enel Américas
S.A. and Ernst & Young
for the exercise 2017
Riesgo Limitada and Fitch Chile Clasificadora de Riesgo
Limitada will be proposed at the respective Shareholder’s
Meeting as private risk national rating agencies, and
Fitch Ratings, Moody’s Investors Service and Standard &
Poor’s International Rating Services will be appointed as
the private international risk rating agencies for the 2017
exercise.
At the ordinary session held on May 30, 2017, the Directors’
Committee unanimously declared to have examined and
approved the contract to be subscribed between Enel
Américas S.A. and the external auditors Ernst & Young.
12.- External Audit
Plan for 2017
10.- External
Auditors’ Proposal
At the extraordinary session held on May 30, 2017, the
Directors’ Committee unanimously agreed to acknowledge
the presentation made by Mr. Emir Rahil, partner of Ernst &
Young, on the External Audit Plan for the year 2017.
At the ordinary session held on March 31, 2017, the
Directors’ Committee unanimously resolved to suggest
the Board to propose at the Ordinary Shareholder Meeting
that the following in priority order would be appointed for
the examining of the current external auditing firm of Enel
Américas S.A., for the year 2017: 1° E&Y; 2° PKF, 3° RSM
and 4° BDO. The main reasons for proposing E&Y as the
13.- Analysis of
Complaints to the
Ethical Channel
external auditor for Enel Américas S.A. are the following:
At the ordinary session held on January 19 and at the
(i) presented the most competitive proposal according
ordinary session of August 31, both in 2017, the Directors’
to verified technical and economic evaluations of the
Committee issued its opinion on each of the complaints
proposals received; (ii) has a high qualification in the quality
presented, delivering guidelines to follow up each one of
of available resources and has extensive experience in the
them and confirming what has been resolved by this entity,
electricity sector; (iii) is one of the four most important
in the sense that it will be responsibility of the Chairman of
international and national audit firms; and (iv) it is the audit
the Directors’ Committee to agree upon a special meeting
firm with the highest level of synergy for Enel Américas
in the event that the complaint deem it appropriate, in the
S.A., as the parent and holding companies of Enel Américas
opinion of the Chairman of the Committee itself.
S.A. , Enel S.p.A. have E&Y as their lead auditor.
11.- Private Risk Rating
Agencies’ Proposal
At the ordinary session held on February 24, 2017, the
Directors’ Committee unanimously agreed to propose to
the Directors’ Committee that Feller Rate Clasificadora de
- At the extraordinary session held on January 19, 2017,
the Chairman of the Directors’ Committee suggested
to evaluate of each case in relation to the merit of the
convenience of prosecute against whoever does an
illegal act, and also to perform surveys to verify whether
employees have an adequate knowledge of the Ethical
Channel a their perception of its operation.
37
Administration 14.- Self Assessment
on Internal Control
At the ordinary session held on July 26, 2017, the Directors’
Committee unanimously agreed to declare the Self-
Assessment structures and procedures on Internal Control
as reviewed and to instruct the General Management to
rectify the significant deficiency exposed by the Chief
Financial Officer, within a reasonable period.
15.- Review of the
Compensation System
and Compensation Plans
for Managers, Senior
Executives and Employees
of the Company
16.- Requests from
public authorities from
the United States
At the ordinary session held on July 26, 2017, the Directors’
Committee unanimously agreed to recommend the Board
to approve, in the terms requested by Ernst & Young,
and subject to due compliance with external audit, with
the requirements included in the Ordinary Rule N° 3,048
of April 13, 2004, and Nº12,826 of December 7, 2005,
both enacted by the Superintendence of Insurance
and Securities, subject to obtaining written consent of
the subsidiary Empresa Distribuidora Sur S.A., so that
Ernst & Young may comply with the requirement of the
Public Company Accounting Oversight Board (PCAOB).
Likewise, it was agreed to take notice of the answers
provided to the Securities and Exchange Commission
of the United States of America with regards to the
observations to Form 20-F.
At the ordinary session held on June 28, 2017, the Directors’
Committee unanimously declared to have examined the
remuneration systems and compensation plans of the
17.- Meetings’ Schedule
company’s managers, chief executives, and employees.
At the ordinary session held on November 29, 2017,
unanimously the Directors’ Committee approved the
Ordinary Meetings’ Schedule for the year 2018.
As such, and as given account in this report, the Directors’
Committee has fully comply with the obligations included
in the Article 50 bis of Law N°18,046 of Corporations Law.
Expenses of Enel Américas
S.A. Directors’ Committee
The Directors’ Committee did not make use of the expense budget for ordinary functions approved by the Ordinary
Shareholders Meeting held on April 27, 2017.
38
Annual Report Enel Américas 2017 Organizational Structure
Board
of Directors
CHAIR M A N
F. De Borja Ach a B e
a
g
s
R
E
FIC
N A L AUDIT OF
R affaele Cutrignelli
R
E
T
I N
F
R
E
FI C
L O
O
R
T
F FIC E R
H
U
M
A
N
R
E
S
O
U
R
C
E
S A
N
C
O
M
CHIEF EXECUTIVE O F F I C E R
Luca D‘Agne s e
M
U
L O
NICATIONS OFFICER C H I E F F I N A N C I A
José Miranda Montecinos Pa o l o P a l l o t
t i ( 2 )
GENERAL COUNSEL PLA N N I N G A N D C O N
Domingo Valdés Prieto Em a n u e l e B r a n d o li n i
D ORGANIZATION OFFICER
Alain Rosolino(1)
(1) Left the position on 01.31.2018.
(2) Paolo Pallotti took position on 02.01.2018 replacing
Francisco Javier Galan Allue.
39
Administration
Main executives
2
5
3
6
1
4
7
4. COMMUNICATIONS OFFICER
José Miranda Montecinos
Audiovisual Communicator
Professional Institute DUOC UC
Executive Competencies Diploma,
Universidad de Chile
Corporate Undertaking and Open Innovation
Studies, Berkeley University
Rut: 15,307,846-7
From 02.29.2016
5. CHIEF FINANCIAL OFFICER
Paolo Pallotti
Electronic Engineer
Università degli Studi di Ancona
Rut: 26,102,661-9
From 02.01.2018(1)
6. GENERAL COUNSEL
Domingo Valdés Prieto
Lawyer
Universidad de Chile
Master Degree in Law of University of
Chicago
Rut: 6,973,465-0
From 04.30.1999
7. PLANNING AND CONTROL OFFICER
Emanuele Brandolini
Industrial Engineer– Degree in Engineer with
full marks (specialist in Management and
Economy)
Università degli Studi Tor Vergata, Rome
(Italy)
Masters Degree in Business Administration
SDA BOCCONI, Milano (Italy)
Rut 25,625,052-7
(1) Paolo Pallotti took position on
02.01.2018 replacing Francisco Javier Galán
Allue.
1. CHIEF EXECUTIVE OFFICER
Luca D’Agnese
Physics Degree
Scuola Normale Superiore de Pisa
Master in Business Administration Escuela
de Negocios de INSEAD
Rut: 24,910,349-7
From 01.29.2015
2. HUMAN RESOURCES AND
ORGANIZATION OFFICER
Alain Rosolino
Business Administration Degree
Universidad LUISS
Rut: 24,166,243-8
From 04.28.2016 to 01.31.2018
3. INTERNAL AUDIT OFFICER
Raffaele Cutrignelli
International Businesses Degree
Nottingham Trent University (United
Kingdom).
Audit and Internal Control Masters Degree
Universitá di Pisa (Italy)
Certificate in Strategy, Innovation,
Management and Leadership
Massachusetts Institute of Technology (MIT)
Rut: 25,553,336-3
From 10.01.2016
40
Annual Report Enel Américas 2017 Officers and senior executives’
compensations
During 2017, remunerations and benefits received by the Chief Executive Officer and senior executives of the Company
amounted to US$4,046 million in fixed remunerations and US$119 million in benefits.
During 2016, remunerations and benefits received by the Chief Executive Officer and senior executives of the Company
amounted to US$4,917 million in fixed remunerations and US$331 million in variable remunerations and benefits.
This amount included compensations for senior managers and executives in exercise as of December 31, each year, as
well as those that left the company during the respective period.
Benefits for officers and senior
executives
The Company provides the benefits of supplementary health insurance and a catastrophic insurance for its main executives
and their family group that is credited as a dependent charge. In addition, the Company has life insurance for its main
executive. These benefits will be granted in conformance to the management level that corresponds to the employee in
due time. In 2017, the amount was CLP$3,706,007 million, which is included in the remunerations received by the senior
management.
Incentive plans for officers and
senior executives
Enel Américas has an annual bonus plan for complying with objectives and the level of individual contribution to the
company results for its executives. This plan includes a definition of the ranges of bonus according to the hierarchical level
of the executives. Bonuses are given to the executives is determined by a number of gross monthly wages.
41
Administration Severance paid to officers and
senior executives
There were no compensations for years of services paid to managers and senior executives during 2017.
Property over Enel Américas
As of December 31, 2017, the register of shareholders reflected that no main executives had ownership on the Company.
There are no requests for the Chief Executive Officer and senior executives to hold securities issued by the Company;
however there is an obligation to inform securities’ holdings and their transactions, both in the Securities Market Law and
the Company’s Information Management Manual of Market Interest.
42
Annual Report Enel Américas 2017
Administration of main
subsidiaries
ARGENTINA
Costanera
Antonino Ascione
Degree in mechanical engineering (cum
laude)
Universidad Federico II of Napoli
BRAZIL
Enel Brasil
Carlo Zorzoli
Electrical Engineer
Università di Roma, La Sapienza
COLOMBIA
Emgesa
Bruno Riga
Aeroespace Engineer
Universidad de Pisa
Hidroeléctrica El Chocón
Daniel Garrido
Industrial Engineer
Universidad Tecnológica Nacional
Edesur
Juan Carlos Blanco
Electrician Engineer
Universidad Tecnológica Nacional
Central Dock Sud
Gustavo Diego Manifesto
Electromecanical Engineer
Universidad de Buenos Aires
Enel Green Power Cachoeira Dourada
Luigi Parisi
Chemical Engineer
Università di Pisar
Codensa
David Felipe Acosta Correa
Electrical Engineer
Universidad Pontificia Bolivariana
PERU
Enel Generación Perú
Marco Raco
Aeronautical Engineer
Universitá di Pisa - Italy
Enel Distribución Perú
Riccardo Lama
Electrician Engineer
La Sapienza University of Rome
Enel Generación Fortaleza
Leonardo Walter Soares
Electrical Engineer / Production
Pontifícia Universidad Catolica Rio de
Janeiro
Enel Cien
Abel Alves Rochinha
Mechanic Engineer
Pontifícia Universidad Católica Río de
Janeiro
Enel Distribución Rio
Ramon Castaneda
Industrial Civil Engineer
Pontifícia Universidad Católica Chile
Enel Distribución Ceará
Roberto Zanchi
Electrotechnical Engineer
Universidad de Padova
Enel Distribución Goiás (Former Celg)
Abel Alves Rochinha
Mechanic Engineer
Pontifícia Universidad Católica Río de
Janeiro
Enel Soluções
Rafael Felipe Coelho
Business Admistration Degree
Pontificia Universidad Catolica Rio de
Janeiro
43
Administration 08Human Resources
44
Annual Report Enel Américas 2017 45
Letter from the Chairman 46
Annual Report Enel Américas 2017 Human Resources Distribution
The employees’ distribution of Enel Américas as of December 31, 2017, including information related to the subsidiaries in
the four countries where Enel Group operates in Latin America and the joint control entities, was the following
Company
Enel Américas
Enel Brasil
Cachoeira Dourada
Fortaleza
Cien
Enel Distribución Rio (1)
Enel Distribución Ceará
Enel Distribución Goiás
Costanera
El Chocón
Edesur
Enel Trading Argentina
Dock Sud
CTM y TESA
Enel Generación Perú (2)
Enel Distribución Perú
Emgesa
Codensa
Total
Managers and Senior
Executives
Professionals and
Technicians
Employees
and Others
7
5
-
2
-
2
3
7
4
1
30
6
3
1
21
24
13
24
154
45
66
67
43
26
904
912
738
392
45
3
1
18
16
9
169
248
353
43
6
3,179
1,042
17
72
4
299
564
591
1,350
9,313
4
12
-
-
-
-
2
1,926
(1) Includes Enel Soluções.
(2) Includes Enel Generación Piura and Generalima.
Total
55
72
85
61
35
1,075
1,163
1,098
439
52
4,251
27
87
5
320
588
604
1,376
11,393
47
Human Resources Social Responsibility and
sustainable development
Diversity in the General
Management and the
other management
departments reporting
to the latter or to the
Board of Directors
Number of people by gender:
Female
Male
Total
Number of people by nationality:
Chilean
Spanish
Italian
Total
Number of people by range age:
Less than 30 years old
Between 30 and 40 years old
Between 41 and 50 years old
Between 51 and 60 years old
Between 61 and 70 years old
Total
Number of people by seniority:
Less than 3 years
Between 3 and 6 years
More than 6 and less than 9 years
Between 9 and 12 years
More than 12 years
Total
48
0
7
7
2
1
4
7
-
3
1
3
-
7
3
3
-
-
1
7
Diversity in the organization
Number of people by gender:
Female
Male
Total
Number of people by nationality:
Argentina
Brazilian
Chilean
Colombian
Italian
Total
Number of people by range age:
Less than 30 years old
Between 30 and 40 years old
Between 41 and 50 years old
Between 51 and 60 years old
Between 61 and 70 years old
Total
Number of people by seniority:
Less than 3 years
Between 3 and 6 years
More than 6 and less than 9 years
Between 9 and 12 years
More than 12 years
General Total
14
34
48
1
3
41
2
1
48
4
22
13
8
1
48
8
9
11
2
18
48
Average Fixed Salary
of women with respect
to men according to
their professional level
Contents:
Senior Management
Middle Management - Level 1
Middle Management - Level 2
Middle Management - Level 3
Professionals - Level 1
Professionals - Level 2
Administratives
0%
115%
0%
75%
84%
113%
N/A
Annual Report Enel Américas 2017 Human Resources Activities
Labor Relations
Labor Security and Health
During 2017 the Company continued the regular meetings
At Enel Américas occupational safety and health are
program with unions, enabling an open dialogue with the
objectives closely linked to the business, whose nature
employees’ representatives, therefore improving work
is subject to critical risks. In the continuous improvement
conditions and environment at the workplace.
process, where everybody makes contributions, leadership
is a value that especially highlights with regards to the real
integration of occupational health and safety at every level
and in each activity developed by the company, which
strengthens its priority in corporate management due to
its strategic importance.
Health Dissemination and Promotion
The objective of this program is to provide health, educate and train employees through activities related to the promotion
of health in quality of life, who includes a widespread dissemination through posters, graphic material and information sent
through mail, denominated “advices that give life”. Among the topics that feature every month, we highlight the following:
> March: anti-stress campaign: Disclose practical recommendations to remove its causes.
> April: Immunization campaign, an invitation to vaccination to prevent influenza.
> May: Anti tobacco campaign, including advises to prevent its consumption.
> June: Prostate and cervical cancer, an invitation to an annual preventive examination.
> July: Viral contagion and respiratory diseases prevention: Recommendations to prevent infections.
> August: Heart care campaign: Practical recommendations for its care.
> September: Colon and gastric cancer campaign for the prompt detection of these diseases through preventive
examination.
> October: Breast cancer prevention: Invitation to participate in the prevention of this disease through its early detection.
> November: Power your energy campaign with practical nutrition advices to improve the quality of life.
> December: Skin care campaign throughout the year. Advises for skin care from ultraviolet radiation and other agents.
Additionally, the Company carried out several health programs, such as:
• Immunization Program
• Preventive Health Exams Program
• Cardiovascular Risk Program
• Break Gym Program
49
Human Resources Additionally, continuity has been given to the interaction
with Human Resources, known as Interactúa. These
are meetings with the permanent presence of human
resources whose objective is to achieve greater proximity,
knowledge from employees of the company’s policies and
good practices, and to be aware of the needs required for
the development of their daily job.
In 2017 the program called “Areas are introduced” was
implemented, where employees deepen in the roles,
functions and challenges of the different areas of the
company. The importance of this program is the promotion
of a culture of cooperation particularly between the
different areas of the company, transforming, guiding and
projecting the teams towards a culture focused on “how
may I help you?.”
We count with professional development management
through promotion actions by merit through local and broad
work opportunities where the Group has presence for the
programs oriented to meritocracy and development.
Other interesting initiatives are the One-on-One meetings,
consisting on personalized conversations with each
employee that enables the deepening of their motivations
and future aspirations, strengthening closeness and
relationships with internal clients.
At Enel Américas, the chances for feedback of managers
with employees are opportunities to generate greater
closeness, transparency, alignment of expectations and
the support of professional development. The promotion
of a culture of continuous feedback guides us to the
development of employees’ talents and the conformation
of high performance teams.
In 2017 the “Recognize” Program continued in a renovated
version, which seeks to foster a culture of recognition within
the company and to generate formal meetings where
employees recognize their colleagues. The “Recognize
People” Program, where the company identifies those
initiatives that have meant great value for the entity
through the “Recognize Contributions” Program. So also
massive ceremonies were performed in the Company to
recognize outstanding employees, work trajectory, among
others.
People Management
Work environment
management
Work environment is a priority for Enel América, for this
reason an Environment and Safety Study is carried out
semi-annually, which counts with broad participation and
from which the Company prepares an action plan to enrich
and strengthen the work environment of the Company.
Work environment management and commitment are the
fundamental cornerstones of the company’s strategy, due
to its close relationship with the people that constitutes
the human resources of the company
During 2017, a series of initiatives continued. These activities
sought to maintain the employees’ motivation, satisfaction
and commitment, in the lines of leadership, communication,
meritocracy and development, reconciliation measures
and good labor practices.
Regarding leadership, Enel Américas has a program
developed to promote and strengthen the role of leaders
in the generation of a corporate environment that enables
satisfaction and development of its employees. The program
“Creating Footprints” has been designed to leverage the
exercise of leadership and the role of the Manager in
our “Open Power” culture, being an active and strategic
role focusing on the mobilization of their equipment and
the ability to promote learning. This is a comprehensive
program for skills training, education and accompaniment
that comprises the development of individual itinerary
for each manager. The activities included in this program
are: skills training workshop, individual coaching, guided
accompaniment for meetings and the creation of a network
of good practices and people management.
With the purpose of establishing a permanent and close
contact with employees, Enel Américas has implemented
a set of communication initiatives under the brand RHO
Contigo, which daily informs and explains various topics
of interest focused on people management. To that end, a
weekly radio show is developed, a website, good practice
manuals for managers and employees, among other
actions.
50
Annual Report Enel Américas 2017 Regarding
reconciliation measures and good
labor
and balance the parents’ needs and professional growth.
practices, smart physical spaces were implemented with
The actions of the program cover health and wellbeing of
the purpose of strengthen team activities, promoting
women areas, talks related to the meaning of the changes
relationships for sharing knowledge and integration. These
that arrives with a new child for the family and to generate
workspaces foster the use of technology and the efficient
trusting bonds between pregnant employees and the
use of time in a more Informal and creative environment.
company.
The new challenges of Enel Américas demand to lead a
In the Age dimension, the development of tutoring
culture of constant change within the organization. In this
programs to support employees during certain important
regard, in 2017 the company developed the program agent
transition periods (for example, the recruitment of new
of change comprised of approximately 50 employees.
staff, employees next to retirement, Millennium Generation
This team has developed initiatives for cultural change
and Zeta Generation).
that help businesses to enforce their projects. Each team
had a Manager of the Company as Sponsor that supports
In the Nationality dimension, a tutor is assigned to expatriate
and guides their initiatives, and make a link between the
workers for assistance and support during the expatriation
technical project and the initiatives of cultural change that
period in order to acknowledge, respect and manage the
the implementation demands.
contrasts between people from different nationalities and
Diversity
Under the Diversity dimension and Inclusion Policy, Enel
Américas has developed as part of its strategy a series of
practices related to gender, age, nationality and disability.
This policy promotes the principles of no discrimination,
equality of opportunities, inclusion and balance between
personal and work lives, and also fundamental values in
the activities of the companies of the Group.
The Policy has established three general principles:
1. Reject any form of arbitrary discrimination, ensure and
promote diversity, inclusion and equal opportunities.
2. Promote and maintain a climate of respect for the
dignity, honor and identity of the individual.
3. Ensure the highest confidentiality standards in relation
to any information related to the private lives of
employees that they would have access to.
In the Gender dimension, the Company evaluated the
population and looks for a balance in the initial stage of
the recruitment and selection processes, and to generate
relationships with universities and professional institutes
to promote the participation and inclusion of women
students, specially in technical areas.
promote their integration
In the Disability dimension, this year a shared value
agreement was signed with Teletón Foundation through
which the participation of young people with disabilities in
the workforce will be promoted. Additionally, together with
Teletón Foundation, the Company developed an e-learning
course of awareness and adaptation to labor inclusion.
Reconciliation measures
and labor flexibility
One of the reconciliation and labor flexibility measures
carried out during 2017 is the definition of a new teleworking
program method, meaning an evolution of Teleworking
Program that started in 2012. “Smart working” consolidated
one of the most valued reconciliation measures in the
Company, providing more flexibility in the job execution
for the employee. Currently in Enel in Chile, we have 256
employees subscribed in the program, 11 of them from Enel
Américas, who one day per week chosen by them (between
Tuesday and Thursday), work from their homes or wherever
they choose, and must comply with the safety and health
measures established by current regulations. This initiative
contributes to the harmony in the workplace and with their
families, together with their quality of life.
Additionally, the purpose of the implementation of the
Parental Program is to increase the value of maternity
Additionally, during 2017, and among those measures, the
Company carried out the following initiatives oriented to
strengthen the quality of live of their employees:
51
Human Resources Extension Program of Sports and Culture: its a traditional
program of sports activities performed in the facilities of the
company and through external partnerships, with workshops
and the practice of different sports, such as football, baby
football, basketball, volleyball and others, and also schools
Recruitment and
Selection
of sports for the employees’ children such as tennis, football
The main objective for Enel Américas is to incorporate
and skating. Also, the company offers art workshops,
the best people for vacant positions, our guiding principle
exhibitions, tours, family trips and other extension initiatives
being to favor internal candidates in the first instance.
addresses to the employee and their families.
There are several actions addressed to the employees’
children, both recreational and educational, among which
summer and winter camps stand out, consisting in
recreational days for the employees’ children between 6
and 15 years old, which take place during the first month
of the year and during the winter vacation period. The
Company also offers training workshops during the summer
addressed to the employees’ families. Other initiative is the
Summer School of Universidad de las Américas, an initiative
that seeks to improve the academic level of the employees’
children at senior school. And as a way to encourage the
children’s’ study, year after year the Academic Excellence
Award is given to the employees’ children that have a high
performance in their studies, for students at elementary
school and at the university.
During the year, the company also performs also various
events to foster the reconciliation of work and family,
being the Christmas Party one of the most important ones,
consisting on a family celebration for employees’ children
born after 2004; “Come to my birthday”, is a celebration
performed each month at the company’s stadium for
children under 12 years old.
The following important events also stand out: the End-of-
Year Party, a corporate event for all employees, consisting on
a dinner and entertainment party, contests and dance; and
the “Work Trajectory Award”, which is a corporate celebration
that each year acknowledges employees with over twenty
years of service at the company.
Covering vacancies
The main objective of Enel Américas is to incorporate the
best people that must have the culture of change and
digital thinking.
During 2017, a woman filled one vacant position internally.
Internships and Young
Talent Attraction Program
In this line, an important project in terms of the generation
of new recruitment sources is the incorporation of
young future professionals from the best universities of
the country as practitioners and thesis students. These
students get the opportunity to consolidate theoretical
learning in the context of Enel Américas’ business, thus
achieving professional training with knowledge of reality
and the challenges of the group, being an important source
of recruitment for our organizational culture.
This internship program is carried out on a permanent
basis during the year, being the summer is the most active
period. In 2017 a total of 5 students were practitioners of
thesis in Enel Américas.
In order to generate ties with universities and attract the
best students, during 2017 Enel participated in the Job Fair
of the Department of Physical Sciences and Mathematics
of Universidad de Chile, and also in the Job Fair of the
Faculty of Engineering of Universidad Católica de Chile.
Our stand received of the career students of the Industrial
Civil Engineer, Electric Civil Engineer and Hydraulic Civil
Engineer.
52
Annual Report Enel Américas 2017 Diversity and inclusion
For Enel Américas, to have different work teams and to
foster an inclusive work environment is essential for
promoting an innovation culture. Diversity gives the
possibility to visualize different points of view and opinions
that enrich the work environment and adds value to the
business.
In our business we value the differences and turn them
into competitive advantages, so we are allowed to improve
our processes, products and services, through incentives
to creativity, learning, flexibility and respect. These also
strengthen our brand and make us more attractive to the
talents available in the market.
Finally, and in the field of continuous improvement, this year
the On Boarding process was carried out to accompany
and follow up the new employees through presentations to
know the company, and the designation of a Tutor to guide
them to become part of the company.
Educational Action
Training
Enel América’s training program for 2017 was built and
executed on the basis of two main management principles:
the first principle is to achieve the right balance between
educational activities focused on skills development and
essential technical knowledge for the best performance of
our employees in their positions. The second principle is the
training program financing, regarding the needs detection
mechanism that enables the identification, together with the
collaborator and the manager, of technical and behavioral
gaps that needs to be covered, with regards to the individual
productivity in the workplace in order to access to possible
future development opportunities. The needs detection
system is denominated IDP (Professional Development
Itinerary), whose implementation takes two years.
Technical training is the main focus of attention of training,
because of the need to update technical knowledge and
acquire new management tools. Among technical training
activities, those related to knowledge management stand
out, which consist on the implementation of activities to
transfer knowledge and experiences in which employees
that have greater expertise in specific topics teach
others that are developing those skills, which reaffirms
our commitment with development, recognition and
knowledge dissemination inside the company.
In relation to the development of new behavioral skills,
different programs were implemented during 2017. Among
them, the internal certificate of Project Management
and Evaluation stands out, which Universidad de Chile
offers under a design specially made for our company’s
needs. In this same context, the activities related to the
development of leadership skills are also relevant, being
particularly important the managements’ program, which
seeks to identify the leadership gaps of each manager
and to develop a training plan specifically designed for
individual needs.
Finally, and as declared in every level and segment of
employees inside the company, risks prevention, health
and in general safety of people is a particularly relevant
focus and permanent attention.
53
Human Resources 09Exchange Transactions
54
Annual Report Enel Américas 2017 55
Letter from the Chairman Exchange Transactions
Below you will find a detail of the quarterly transactions in the last three years made in the stock exchanges where the Enel
Américas’ shares are traded: in Chile through the Santiago Stock Exchange, the Electronic Stock Exchange of Chile and the
Valparaíso Stock Exchange, and in the United States through the New York Stock Exchange (NYSE).
Santiago Stock Exchange
During 2017, 9,393 million shares were traded at the Santiago Stock Exchange, equivalent to CLP$ 1,211,204 million. The
closing price of the stock in December was CLP$ 137.03.
Period
1st quarter 2015
2nd quarter 2015
3rd quarter 2015
4th quarter 2015
2015 Total
1st quarter 2016
2nd quarter 2016
3rd quarter 2016
4th quarter 2016
2016 Total
1st quarter 2017
2nd quarter 2017
3rd quarter 2017
4th quarter 2017
2017 Total
Units
Amounts (Chilean Pesos)
Average
1,389,153,497
1,579,468,813
1,314,355,177
1,436,751,752
5,719,729,239
1,540,145,250
1,753,142,660
1,232,162,338
2,168,846,180
6,694,296,428
2,229,781,463
2,009,919,858
2,356,887,602
2,796,096,892
9,392,685,815
275,998,191,628
334,826,261,051
250,659,886,643
253,340,302,162
1,114,824,641,484
266,620,137,076
212,677,167,355
140,048,801,925
239,278,798,879
858,624,905,235
273,721,586,257
261,422,184,124
309,180,255,882
366,879,556,230
1,211,203,582,493
198.83
211.43
191.24
176.50
194.5
172.74
110.85
113.49
110.60
126.92
122.90
130.71
131.24
131.46
129.08
Electronic Stock Exchange of Chile
At the Electronic Stock Exchange of Chile a total of 971 million shares were traded during 2017, equivalent to CLP$126,724
million. The closing price of the share in December was CLP$133.74.
Period
1st quarter 2015
2st quarter 2015
3rd quarter 2015
4th quarter 2015
2015 Total
1st quarter 2016
2nd quarter 2016
3rd quarter 2016
4th quarter 2016
2016 Total
1st quarter 2017
2nd quarter 2017
3rd quarter 2017
4th quarter 2017
2017 Total
56
Units
Amounts (Chilean Pesos)
Average Price
75,325,511
153,979,478
172,604,478
167,393,236
569,302,703
130,742,124
122,026,677
88,217,958
228,583,097
569,569,856
78,056,955
253,547,191
367,188,645
272,011,584
970,804,375
14,893,594,307
33,094,253,771
32,789,265,995
29,438,618,540
110,215,732,613
22,440,123,693
14,581,565,262
10,001,108,374
25,262,018,950
72,284,816,279
9,660,465,656
32,973,128,058
48,153,275,546
35,937,385,836
126,724,255,096
197.37
213.08
193.19
176.32
194.99
172.97
121.46
113.65
111.66
129.94
121.16
130.37
130.87
132.97
128.84
Annual Report Enel Américas 2017 Valparaíso Stock Exchange
A total of 162.9 thousand shares were traded during the year at the Valparaíso Stock Exchange, equivalent to CLP$ 20.4
million. The closing price of the share in December was CLP$ 124,00.
Period
1st quarter 2015
2nd quarter 2015
3rd quarter 2015
4th quarter 2015
2015 Total
1st quarter 2016
2nd quarter 2016
3rd quarter 2016
4th quarter 2016
2016 Total
1rd quarter 2017
2nd quarter 2017
3rd quarter 2017
4th quarter 2017
2017 Total
Units
13,500
0
0
0
13,500
0
0
120,460
0
120,460
5,576
29,273
2,070
126,000
162,919
Amounts (Chilean Pesos)
2,660,000
Average Price
197.5
0
0
0
2,660,000
0
0
13,512,912
0
13,512,912
697,388
3,816,345
270,232
15,624,000
20,407,965
197.5
112.46
112.46
125.06
128.68
130.54
124.00
127.07
New York Stock Exchange (NYSE)
The stocks of Enel Américas began to trade in the New York Stock Exchange (NYSE) on October 20, 1993. At that time,
the name of the company was Enersis and the ticker symbol was ENI. One ADS (American Depositary Share) of Enel
Américas represents 50 shares and its current ticker symbol is ENIA. Citibank N.A. acts as a depositary bank and Banco
Santander Chile as custodian in Chile.
During 2017, 237 million ADS were traded in the United States, equivalent to US$ 2,354 million. The ADS closing price in
December was US$ 11.17.
Period
1st quarter 2015
2nd quarter 2015
3rd quarter 2015
4th quarter 2015
2015 Total
1st quarter 2016
2nd quarter 2016
3rd quarter 2016
4th quarter 2016
2016 Total
1st quarter 2017
2nd quarter 2017
3rd quarter 2017
4th quarter 2017
2017 Total
Units
31,386,671
52,955,231
46,264,472
60,162,543
190,768,917
58,523,621
59,311,337
45,809,391
52,176,921
215,821,270
55,867,021
66,972,268
59,641,261
54,800,714
237,281,264
Amounts (Dollars)
Average Price
499,346,581
915,144,721
646,446,669
755,874,266
2,816,812,237
719,235,235
562,497,059
395,562,633
432,967,188
2,110,262,115
532,101,627
653,636,388
603,478,379
564,766,815
2,353,983,209
15.91
17.19
14.09
12.58
14.94
12.35
9.68
8.59
8.32
9.73
9.45
9.81
10.14
10.34
9.93
57
Exchange Transactions Market Information
In 2017 the Chilean stock market showed the greatest growth of the last seven years in terms of profitability. The IPSA
index yield increased 34.0% compared to 2016, representing the highest growth since 2010. This yield was even higher
than the ones experienced by the main global markets, such as New York (Dow Jones, +25.1%) and London (FTSE
100, +7.6%), whilst in Latin America the main bourses shower very positive returns, such as Argentina (+77.7%), Brazil
(+26.8%), Colombia (+11.9%) and Peru (26.6%).
On the other hand, during 2017 the currencies in the countries where Enel Américas operates appreciated in relation to the
dollar of the United States with the exception of Argentina, meanwhile GDP grew in the four countries (Argentina, +2.8%;
Brazil, +1.1%; Colombia, +1.8%, and Peru, +2.5%).
Santiago Stock Exchange
In the local market, the performance of Enel Américas’ stock (traded as Enersis from January 1 to April 20, 2016) during
the last two years compared to the Selective Stock Prices Index (Índice Selectivo de Precios de Acciones, IPSA) is the
following:
Variation
Enel Américas
IPSA
01/01/2016 - 04/20/2016(1)
04/21/2016 - 12/31/2016(2)
8.9%
8.3%
15.3%
4.1%
2017
25.9%
34.0%
(1) Price variation of Enersis’ stock, since January 1 to April 20, 2016.
(2) Price variation of Enel Américas’ stock, since April 21, 2016 to December 31, 2016.
New York Stock Exchange (NYSE)
The performance of Enel Américas’ ADRs listed in the NYSE (ENIA) compared to Dow Jones Industrial Index and the Dow
Jones Utilities Index during the last two years is shown below:
Variation
ENIA
Dow Jones Industrial
Dow Jones Utilities
01/01/2016 - 04/26/2016(1)
04/26/2016 - 12/31/2016 (2)
14,2%
3,2%
11,3%
11,3%
9,5%
1,0%
2017
36,1%
25,1%
9,7%
(1) Price variation of Enersis’ ADR (ticker symbol was ENI), from January 1 to April 26, 2016 (before the ADR split between ENIA and ENIC).
(2) Price variation of Enel Américas’ ADR (ticker symbol is ENIA), from April 27 to December 31, 2016 (after the ADR split).
58
Annual Report Enel Américas 2017 59
Exchange Transactions 10Dividends
60
Annual Report Enel Américas 2017 61
Letter from the Chairman In accordance with General Norm N°283, Number 5, the dividends policy of the company corresponding to the exercises
2018 and 2017 are transcribed below.
2018 Dividend
Policy
Procedure for
Dividends Payment
General Aspects
The Board of Directors of the Company, in session held
on February 28, 2018, approved the following Dividend
Policy and the corresponding procedure for the dividends
payment of Enel Américas S.A. for the period 2018.
Dividend Policy
The Board of Directors’ intention is to distribute an interim
dividend against 2018 profits, of up to 15% of profits
accounted as of September 30, 2018, as shown in the
financial statements of Enel Américas S.A. at that date,
and payment will be carry out in January 2019.
For the dividends payment, whether provisory or final, and in
order to avoid their improper collection, Enel Américas S.A.
considers the following modalities indicated:
1. Deposit in banking checking account, whose account
holder is the shareholder,
2. Deposit in banking savings account, whose account
holder is the shareholder;
3. Send a nominative check or bank check by certified
mail to the shareholder’s residence recorded in the
Enel Américas S.A.’s shareholders’ register; and
4. Withdrawal of the check or bank check at the offices
of DCV Registros S.A., in its capacity as Enel Américas
S.A’s administrator of the shareholders’ register,
or in the bank or branch offices are determined for
such purpose and that will be informed in the notice
published regarding the dividends’ payment.
For these purposes, checking or savings banking accounts
can be located anywhere in the country.
The Board of Directors will propose to the Ordinary
Shareholders’ Meeting, to be held during the first four
months of 2019, to distribute a final dividend, an amount
equivalent to 40% of the profits of the 2018 accounting
period.
It’s worth to highlight that payment modality chosen by
each shareholder will be used by DCV Registers S.A. for all
dividends payments, while the shareholder doesn’t express
in writing his intention to modify it and thus records a new
option.
The definite dividend will correspond to be defined by the
Regular Shareholders’ Meeting, to be held during the first
four months of 2019.
Shareholders that don’t have a payment modality registered
will be paid according to modality No. 4 mentioned above.
Compliance of the aforementioned program will be
conditioned, in matter pertaining to dividends, to the profits
effectively obtained, as well as on the results that forecasts
that periodically the Company performs or the existence of
certain circumstances, as appropriate.
In those cases which checks or bank checks are returned
by mail to DCV Registers S.A., they will remain under
custody until the shareholders withdraw or request them.
In the case of deposits in banking checking accounts,
Enersis S.A. and/or DCV Registers S.A. may request, for
62
Annual Report Enel Américas 2017 security reasons, verification by the corresponding banks.
Regular Shareholders’ Meeting, to take place during the
If the accounts indicated by the shareholders are objected,
first four months of 2018.
whether in a prior verification process or for any other
cause, the dividend will be paid according to the modality
Compliance of the aforementioned program will be
indicated in Item No. 4 mentioned above.
conditioned, in matter pertaining to dividends, to the profits
effectively obtained, as well as on the results that forecasts
On the other hand, the Company has adopted and will
that periodically the Company performs or the existence of
continue to adopt in the future all necessary security
certain circumstances, as appropriate.
measures required that is required by the dividends
payment process,
in order to safeguard both the
shareholders as well as Enel Américas S.A.
2017 Dividend
Policy
General Aspects
Distributable
Income of 2017
The distributable income of 2017 is shown below:
Net Income *
Distributable Income
* Attributable to the controlling shareholder
Thousands US$
709,043
709,043
At the session held on February 24, 2017, the Board
of Directors of the Company approved the following
Dividends Policy and the procedures for payment of Enel
Distributed Dividends
Américas S.A. dividends for the 2017 accounting period,
The following chart shows the dividends per share paid in
which was presented at the Ordinary Shareholders
the last years:
Meeting of April 27, 2017.
N° Dividend
84
85
86
87
88
89
90
91
92
93
94
95
96 (1)
Type of
dividend
Interim
Final
Interim
Final
Interim
Final
Interim
Final
Interim
Final
Interim
Final
Interim
Closing Date
Payment
Date
01-21-2012
01-27-2012
05-17-2012
05-24-2012
01-19-2013
01-25-2013
05-04-2013
05-10-2013
01-25-2014
01-31-2014
05-10-2014
05-16-2014
01-24-2015
01-30-2015
05-18-2015
05-25-2015
01-23-2016
01-29-2016
05-17-2016
05-24-2016
01-21-2017
01-27-2017
05-20-2017
05-26-2017
01-20-2018
01-26-2018
Pesos/
Dollars per
share (1)
Exercise
1.46560
4.28410
1.21538
3.03489
1.42964
5.27719
0.83148
5.38285
1.23875
3.40599
0.94664
2.38705
0.00100
2011
2011
2012
2012
2013
2013
2014
2014
2015
2015
2016
2016
2017
(1) The Extraordinary Shareholders’ Meeting held on April 27, 2017
approved the change of functional currency of the Company
from Chilean Pesos to US Dollars. Then, from the period 2017
onwards, dividends are presented in dollars per share.
Dividends Policy
The Board of Directors’ intention is to distribute an interim
dividend against 2017 profits of up to 15% of profits
accounted as of September 30, 2017, as shown in the
financial statements of Enel Américas S.A. at that date,
and the payment will be performed in January 2018.
The Board of Directors will propose to the Ordinary
Shareholders’ Meeting, to be held during the first quarter
of 2017, to distribute a final dividend, an amount equivalent
to 50% of the profits of the 2017 accounting period. The
definite dividend will correspond to be defined by the
Dividendos
63
11Investment and financing policy for 2017
64
Annual Report Enel Américas 2017 65
Letter from the Chairman The Ordinary Shareholders’ Meeting held on April 27, 2017 approved the Investment and Financing Policy detailed below.
Investments
Areas of Investment
Enel Américas S.A. will perform investments, according to
its bylaws, in the following areas:
Contributions to carry out investments or create subsidiaries
and associate companies whose activity is aligned, related
or linked by any form or type of energy, the supply of public
utilities, or whose main input is energy.
Investments related to the acquisition, exploitation,
construction, leases, administration, trading and disposal
i)
Investments in their subsidiaries of the electricity
industry, those required for the fulfillment of the
respective corporate purposes, whose maximum
amount is equivalent to 50% of the Net Equity
accounted in the Consolidated Balance Sheet of Enel
Américas as of December 31, 2016;
ii)
Investments in other subsidiaries not related to the
electricity business, as long as at least 50.1% of the
total consolidated assets of Enel Américas are from
the electricity sector.
Participation in the Control
of Investment Areas
of any class of fixed assets, whether directly or through
In order to control the investment areas and pursuant
subsidiaries.
to Enel Américas S.A. corporate purpose, the following
procedure will be pursued whenever possible:
Other investments of all kinds such as financial assets,
titles or securities.
> i) It will be proposed at the ordinary shareholders’
Maximum
Investment Limits
The maximum investment limits for each investment area
are the following:
meetings of our subsidiaries and associate companies
the appointment of directors related to the Enel Américas
S.A.’s stake in that company, candidates that preferably
need to be directors or executives of the Company or its
subsidiaries;
> ii) The investment, financial and commercial policies
will be proposed to the subsidiaries and associate
companies, as well as the accounting criteria and
systems to be followed;
> iii) The management of the subsidiaries and related
companies will be supervised;
> iv) There will be a permanent control of debt limits.
66
Annual Report Enel Américas 2017
Financing
Maximum Debt Level
The maximum debt level of Enel Américas is determined
that the relation Total Financial Debt (calculated as Other
Current Financial Assets plus Other Non-Current Financial
Management Attributions
to Agree with Lenders on
Granting of Guarantees
Liabilities) has to be less or equal to 2.2 times Total Equity,
One of the duties of the Extraordinary Shareholders’
based on the Consolidated Balance Sheet of Enel Américas
Meeting is to approve the granting of tangible or personal
as of December 31, 2016.
guarantees to cover third parties’ obligations, in relation to
the essential assets detailed further on.
Management Attributions
to Agree with Lenders
Restrictions related to
Dividends’ Distribution
Essential Assets for
the Normal Operation
of the Company
Dividends restrictions may only be agreed with creditors
if those restrictions were previously approved at the
shareholders’ meeting (ordinary or extraordinary).
The essential assets for the operation of Enel Américas
are the direct or indirect participation, which enables the
control through the ownership of the majority of shares
or the existence of shareholders’ agreements or pacts, of
Enel Brasil and Emgesa.
Investment and financing policy for 2017
67
12Business of the Company
68
Annual Report Enel Américas 2017 69
Letter from the Chairman Business Structure
GENERATION
DISTRIBUTION
ENEL GENERACIÓN COSTANERA
EDESUR
ENEL GENERACIÓN EL CHOCÓN
ENEL DISTRIBUCIÓN RÍO
CENTRAL DOCKSUD
ENEL DISTRIBUCIÓN GOIÁS
FORTALEZA
ENEL DISTRIBUCIÓN CEARÁ
EGP CACHOEIRA DOURADA
CODENSA
VOLTA GRANDE
ENEL DISTRIBUCIÓN PERÚ
ENEL CIEN*
EMGESA
ENEL GENERACIÓN PERÚ
ENEL GENERACIÓN PIURA
*TRANSMISSION
70
Annual Report Enel Américas 2017 Historical
Background
companies born from the division changed its name to
Enersis S.A. At the Extraordinary Shareholders’ Meeting
held on April 11, 2002, the company’s corporate purpose
was modified, introducing telecommunications activities
and the investment and management of companies whose
On June 19, 1981, the Compañía Chilena de Electricidad
businesses are in telecommunications and information
S.A. created a new corporate structure, which gave birth to
technology, and Internet trading businesses.
a parent company and three subsidiaries. One of these was
Compañía Chilena Metropolitana de Distribución Eléctrica
In 1988, and in order to successfully face the development
S.A. In 1985, under the Chilean government’s privatization
and growth challenges, the company split into five
policy, the process of transferring the share capital of
business units, which in turn gave birth to five subsidiaries.
Compañía Chilena Metropolitana de Distribución Eléctrica
Out of these, Chilectra and Río Maipo were responsible
S.A. to the private sector begun, and ended on August
for electricity; Manso de Velasco was focused on
10, 1987. In this process, the pension fund management
electrical engineering and construction services, plus real-
companies (AFPs in its Spanish acronym), company
estate management, Synapsis in the area of information
employees, institutional investors and thousands of small
technology and data processing, while Diprel focused on
shareholders
joined the Company.
Its organizational
providing procurement and trading of electrical product.
structure was based on activities or operative functions
whose results were evaluated functionally and
its
The Company
recently went
through a corporate
profitability was limited by a tariff structure as a result
restructuring process that started in April 2015 and was
of the Company’s exclusive dedication to the electricity
completed in December 2016. This process consisted in
distribution business.
the division of the electricity generation and distribution
activities developed in Chile, from those performed in the
In 1987, the Company’s Board proposed forming a division
rest of the countries. As such, the former Enersis S.A.
for each of the parent company’s activities. Then four
was divided and the following companies were born: a)
subsidiaries were created to operate as business units
Enel Américas S.A., the continuing company of Enersis
with its own objectives, thus expanding the company’s
with activities in Argentina, Brazil, Colombia and Peru, and,
activities towards other non-regulated activities but linked
b) Enel Chile S.A. which owns the assets related to the
to the main business. This division was approved at the
development of the activities in Chile.
Extraordinary Shareholders’ Meeting of November 25,
1987 thus defining its new corporate purpose. With this,
Today Enel Américas S.A. is one of the largest private
Compañía Chilena Metropolitana de Distribución Eléctrica
electricity companies in Latin America, both in terms
S.A. became an investment holding company.
of consolidated assets and also in terms of operating
On August 1, 1988, as agreed at the Extraordinary
balanced growth in its electricity businesses: generation,
Shareholders’ Meeting held on April 12, 1988, one of the
transmission and distribution.
revenues, which has been achieved through steady and
71
Company’s Business Expansion and
development
1996
> On December 20, Enel Américas entered the Brazilian
market with the acquisition of a large portion of shares
in the previously called Companhia de Eletricidade do
Río de Janeiro S.A., Cerj, a company that distributes
electricity in the city of Río de Janeiro and Niteroi, Brazil,
Enel Américas began its international expansion in 1992
whose business name changed to Ampla Energía e
with the participation in different privatization processes
Serviços S.A. and currently is Enel Distribución Río.
in Latin America, thus developing a significant presence in
> On December 20, the Company acquired a 99.9%
the electricity sectors of Argentina, Brazil, Colombia and
shareholding in Central Hidroeléctrica de Betania S.A.
Peru.
E.S.P, in Colombia.
1992
> On May 15, the Company acquired a 60% shareholding
1997
> On September 5, the Company acquired for US$715
and control of Central Costanera generation company,
million a 78.9% shareholding in Centrais Elétricas
currently Enel Generación Costanera, located in Buenos
Cachoeira Dourada
(currently Enel Green Power
Aires, Argentina.
Cachoeira Dourada), in Brazil.
> On July 30, the Company was awarded 51% of Empresa
> On September 15, Enel Américas (at that time, Enersis)
Distribuidora Sur S.A., Edesur, a company that distributes
successfully participated in the capitalization of Codensa
electricity in the city of Buenos Aires, Argentina.
S.A. E.S.P., acquiring a shareholding of 48.5% for
1993
> In July, the Company acquired Hidroeléctrica El Chocón,
US$1,226 million, company that distributes electricity in
the city of Bogotá and the department of Cundinamarca,
Colombia. The Company also acquired 5.5% of Empresa
Eléctrica de Bogotá.
today Enel Generación El Chocón, located in the
> On September 15, with a total investment of US$951
provinces of Neuquén and Río Negro, Argentina.
million, the Company acquired a 75% shareholding of
1994
> In July, Enel Américas acquired for US$176 million the
60% share capital of Empresa de Distribución Eléctrica
de Lima Norte S.A., Edelnor (currently Enel Distribución
Perú) in Peru. Also the Company acquired Edechancay,
another electricity distribution company in that country,
Emgesa, a Colombian generation company, and an
additional 5.5% of Empresa Eléctrica de Bogotá S.A.
> Endesa, S.A. (Spain) acquired 32% of Enersis (currently
Enel Américas).
1998
> On April 3, Enersis (currently Enel Américas) again
which was later absorbed by the former.
invested the Brazilian market, this time being awarded
1995
> On December 12, Enel Américas acquired an additional
89% and control of Companhia Energética de Ceará S.A.,
Coelce (currently Enel Distribución Ceará), company
that distributes electricity in the northeast region of the
country, in the state of Ceará. The transaction reached
39% of Edesur.
US$868 million.
> Additionally, the Company acquired the generation
company Edegel (currently Enel Generación Perú) in
Peru.
72
Annual Report Enel Américas 2017 1999
> Endesa, S.A. (Spain), took control of Enersis (today Enel
Américas). Through a Public Share offering, Endesa
2005
> The subsidiary Endesa Brasil S.A. (today Enel Brasil) was
acquired an additional holding of 32% in Enersis, which,
formed with all the assets held in Brazil by the Enersis
together with the 32% already acquired in August 1997,
Group and Endesa Internacional (later it was absorbed
resulted in a total holding of 64%. This transaction was
by Enel Iberoamérica): Enel Cien, Fortaleza, Enel Green
completed on April 7,1999, and involved an investment
Power Cachoeira Dourada, Ampla, Investluz and Coelce.
of US$1,450 million. As a result of the capital increase
made afterwards by Enersis in 2003, this shareholding
decreased to the current 60.62%.
> On May 11, Enersis (currently Enel Américas) acquired
2006
> In February, Enersis acquired for approximately US$17
35% of Endesa Chile (today Enel Generación Chile), in
million the Termocartagena (142 MW) combined cycle
addition to the 25% already held, thus reaching 60%
power plant in Colombia, which operates with fuel oil
shareholding of the generation company. The company
or gas.
therefore consolidated its position as one of the main
> In June, Edegel (currently Enel Generación Perú) and
private electricity companies in Latin America.
Etevensa were merged, the latter a subsidiary of Endesa
2000
> As part of the Genesis Plan strategy, the subsidiaries
Transelec, Esval, Aguas Cordillera and real estate assets
were sold for US$1,400 million.
2001
> The Company performed large investments this year:
US$364 million for increasing the shareholding in
Chilectra (today Enel Distribución Chile), US$150 million
in the acquisition of 10% of the share capital of Edesur,
in Argentina, a stake that was held by the company’s
Internacional (later was absorbed by Enel Iberoamérica)
in Peru.
2007
> In September the merger of the Colombian generation
companies Emgesa and Betania was completed.
> On October 11, Enel S.p.A. and Acciona, S.A. took
control of Enersis, through Endesa, S.A., and of Endesa
Internacional, S.A. (currently absorbed by Enel SpA.).
2009
> The companies Acciona, S.A. and Enel S.p.A. announced
employees; US$132 million to increase its shareholding
an agreement whereby Acciona, S.A. will directly
in the Brazilian distribution company Ampla; US$23
and indirectly transfer to Enel Energy Europe S.L. the
million to increase its shareholding by 15% in Río Maipo,
25.01% shareholding in Endesa, S.A. As such, Enel
in Chile, and US$1.6 million to increase its shareholding
Energy Europe S.L., controlled 100% by Enel S.p.A., will
by 1.7% in Distrilima, in Peru.
thus hold 92.06% of the share capital of Endesa, S.A.
2002
> In Brazil, Central Termoeléctrica Fortaleza, located in
> On June 25, the agreement between Enel S.p.A. and
Acciona, S.A. came into effect whereby Enel became the
controller of 92.06% of the share capital of Endesa, S.A.
> On October 9, Endesa Chile (currently Enel Generación
the state of Ceará, was awarded to the Company.
Chile) acquired 29.3974% of the Peruvian generation
Additionally, started the commercial operation of the
subsidiary Edegel (currently Enel Generación Perú).
second phase of the electricity interconnection between
Shares were acquired at market price from Generalima
Argentina and Brazil, CIEN, completing a transmission
S.A.C., a company which in turn is a subsidiary of Endesa
capacity of 2,100 MW between both countries.
Latinoamérica S.A. Endesa Chile thus now holds directly
73
Company’s Business and indirectly 62.46% of the shares of Edegel.
informed the decision to convene an Extraordinary
> On October 15, Enersis S.A. (today Enel Américas)
Shareholders Meeting which will
take place on
acquired 153,255,366 shares, representing 24% of the
September 13, with the purpose of resolving, among
share capital of its Peruvian subsidiary Enel Generación
other matters, the capital increase of the Company for the
Perú (formerly Edegel), at a price of 2.72 soles per share.
equivalent in Chilean pesos, of up to US$8,020 million or
This was purchased from Generalima S.A.C., a Peruvian
the amount that the Extraordinary Shareholders Meeting
subsidiary of Enel Latinoamérica S.A., the parent
determines. In early August, the SVS stated that the
company of Enersis. With this transaction, the direct
Board of Enersis must adopt the actions necessary to
and indirect shareholding of Enersis S.A. in Edelnor rose
strictly comply with the conditions established by Articles
from 33.53% to 57.53%.
2010
> Enersis (today Enel Américas) accepted the offer of the
15, 67 and Title XVI of Law 18,046 (Corporations Law),
considering that they are complementary and when
applicable should be considered simultaneously. These
conditions are related to capital increase transactions
and related party transactions respectively. Once the
company Graña y Montero S.A.A., for the acquisition of
indications of the SVS were acknowledged, Enersis
its entire direct and indirect shareholding in its subsidiary
(today Enel Américas) adopted them and continued with
Compañía Americana de Multiservicios Limitada, CAM;
the capital increase operation. The Board of Directors
and in the same way, accepted the offer presented
resolve postponing the Extraordinary Shareholders
by Riverwood Capital L.P to acquire the entire direct
Meeting to take place September 13 to a later date to
and indirect shareholding in its subsidiary Synapsis
be determined opportunely. After strictly complying with
Soluciones y Servicios IT Ltda. The price offered for CAM
the conditions established by Articles 15, 67 and Title
and its subsidiaries in Argentina, Brazil, Colombia and
XVI of Law 18,046 (the Board of Directors requested
Peru amounted to US$20 million. In the case of Synapsis,
the independent valuation by IM Trust and the Directors
the price offered for the company and its subsidiaries
Committee requested the independent valuation of
in Argentina, Brazil, Colombia and Peru amounted to
Claro y Asociados Ltda., the Directors Committee
US$52 million.
2011
> In August, Endesa, S.A. informed through a Significant
issued its report and each Director gave his opinion with
respect to the proposed operation). The Extraordinary
Shareholders Meeting held on December 20 ruled
on the capital increase. A very large majority, almost
86% of all shareholders present with voting rights,
Event, the formalization of a purchase agreement
equivalent to 81.94% of the total shares with voting
for which Endesa Latinoamérica S.A. (100% owned
rights of the Company, approved the capital increase
by Endesa, S.A.) acquires 7.70% stake owned by
of the following characteristics: 1) Maximum amount of
EDP Energias de Portugal S.A. in Endesa’s Brazilian
the capital increase: Ch$ 2,844,397,889,381, divided into
subsidiaries Ampla Energia e Serviços S.A. and Ampla
16,441,606,297 ordinary nominative payment shares of
Investimentos e Serviços S.A. for Euro 76 million and
the same series, with no preferences and no par value,
Euro 9 million, respectively. After these acquisitions,
2) Value of non-in-kind contributions to be capitalized:
Endesa S.A. controlled 99.64% of the share capital of
The total issued capital of Cono Sur, Company that will
both companies.
2012
> In July, through a Significant Event submitted to the
concentrate the activities that are identified in the reports
that have been made available to the shareholders and
that would be contributed by Endesa(currently Enel
Generación Chile) to Enersis (currently Enel Américas),
will amount to Ch$ 1,724,400,000,034 corresponding
Superintendence of Securities and Insurance (SVS),
to 9,967,630,058 shares of Enersis S.A. (today Enel
the Board of Directors of Enersis (today Enel Américas)
Américas) at a price of Ch$ 173 per share, 3) Placement
74
Annual Report Enel Américas 2017 share price: a fixed price of Ch$173 for every payment
result Enel S.A. reached the direct control of Enersis
share to be issued as a result of the capital increase.
(today Enel Américas) with 60.62%.
2013
> Capital Increase: With an historic result for this type of
2015
> On April 28, 2015, the Board of Directors of Enersis
operation in the local market, shareholders of Enersis
(currently Enel Américas) agreed to initiate the studies
(today Enel Américas) subscribed a total of approximately
for a possible corporate reorganization to divide the
$ 6,022 million, a placement of 100% of the shares
generation and distribution activities in Chile from the
available for the capital increase.
rest of the activities developed abroad by Enersis and
> In July, the new Malacas 185 MW power plant was
its subsidiaries Endesa Chile and Chilectra (today Enel
commissioned in Piura, Peru, company owned by
Américas).
Empresa Eléctrica de Piura (EEPSA) part of the Enersis
> On November 16, 2015, the commissioning of El Quimbo
Group (today Enel Américas Group). This new power
power plant, a 400 MW hydro facility in Colombia took
plant required an investment of US$105 million.
place, after five years of construction.
> On November 6 the first modernized unit of Salaco
> On December 18, 2015 the Extraordinary Shareholders
project in Colombia was commissioned, corresponding
Meeting took place, where the shareholders of the
to unit 2 of the run-of-the-river Darío Valencia Samper
Company approved the corporate restructuring of
plant, with an installed capacity of 50 MW. This unit
Enersis and its subsidiaries Endesa Chile and Chilectra
generated 46.3GWh since it’s commissioning until
(today Enel Américas).
midnight, December 31 at 24 hours.
2014
> Public Tender Offer for the shares acquisition for Coelce.
2016
> On March 1, the non-material Division of the former
Enersis, Endesa and Chilectra was made, as a result
On January 14, Enersis (today Enel Américas), which
of which Enel Chile, Endesa Américas and Chilectra
until then controlled 58.87% of its subsidiary Coelce,
Américas were born.
launched a voluntary OPA of all series of shares issued
> On April 21, 2016, shares’ Division of Enersis, Endesa and
by Coelce at a price of R$49 per share. With this,
Chilectra became effective, and the resulting companies
Enersis acquired 3,002,812 common shares, 8,818,006
- Enersis Américas, Enersis Chile, Endesa Américas,
preferred shares type A and 424 preferred shares type
Endesa Chile, Chilectra Américas and Chilectra Chile –
B, equivalent to an investment of approximately US$243
began trading at the Santiago Stock Exchange. Likewise,
million. After the operation, the company obtained a
the ADR’s ENIA, ENIC, EOCA and EOCC began trading
74.05% direct and indirect interest in Coelce.
on April 27 the same year at the New York Stock
> In April, Enersis (today Enel Américas) closed an
Exchange. (NSYE).
acquisition agreement for the purchase all the shares
> On September 28, the Extraordinary Shareholders’
that Inkia Americas Holdings Limited indirectly had of
Meeting took place at the Enersis Stadium, where the
Generandes Perú S.A., equivalent to a 39.01% stake,
Merger of Enersis Américas, Endesa Américas and
whose investment amounted to US$413 million. The
Chilectra Américas was approved, and comprised the
transaction ended in September, and as a result Enersis
following: on the part of Enersis Américas, it absorb
(currently Enel Américas) reached 58.60% shareholding
Endesa Américas and Chilectra Américas. The main
of Edegel (today Enel Generación Perú).
purposes of The Merger were: 1) Align every investment
> On July 31, 2014, Enel Energy Europe S.R.L., currently
interests in generation and in distribution in the scope of
Enel Iberoamérica SRL, controller of Endesa S.A.
Latin America; 2) Create a simpler structure with greater
(92.06% share) proposed the acquisition of 100% of
the share capital of Endesa Latinoamérica S.A. The
transaction was completed in October 2014, and as a
75
Company’s Business 76
Annual Report Enel Américas 2017 visibility, and eliminate the cross participations; 3)
such, the Company proceeded with the exchange of
Greater efficiency and dynamism in the decision making
shares and the merger is achieved.
processes, costs reduction and remove any potential
conflicts of interest.
> On September 13 the Public Tender Offer for the shares
acquisition
(OPA) for the shareholders of Endesa
2017
> On February 1, in Argentina the National Electricity
Américas was launched. The price was $300 pesos per
Regulatory Entity (ENRE for Spanish acronym) approved
share. This operation ended on October 28.
the Integral Tariff Review – known as RTI - defining a
> On September 29 started the period to exercise the
structural change in energy distribution in the country.
Withdrawal Right of dissenting shareholders. The
This new regulation is the result of an extensive work
established prices were the following: Enersis Américas
made between the government and the distribution
$112.02 pesos, Endesa Américas $299.64 pesos
companies involved in the tariff revision process,
and Chilectra Américas $472.79 pesos. The period to
consisting on a gradual increase of the tariff with the
exercise the Withdrawal Right ended on October 28.
purpose of softening the impact for the final consumer.
> On December 1, the name change of Enersis Américas
> On February 14, Enel Américas completed the acquisition
to Enel Américas took place, after the intangible merger
of Celg Distribuição S.A. (now Enel Distribución Goiás)
with the companies Endesa Américas and Chilectra
through its subsidiary Enel Brasil with the acquisition
Américas.
of nearly 94.8% of its share capital. This distribution
> On November 30 it was announced that the Company
company has more than 2.9 million clients and operates
presented the best offer for the acquisition of the
in the Brazilian region of Goiás. The amount of the
electricity distribution company CELG-D, which was
operation reached BRL$ 2,187 million (approximately
performed within a bidding process arranged by the
US$640 million). The financing of this transaction came
Brazilian Government through Banco Nacional do
from the capital increase of Enel Américas (former
Desenvolvimento. The offer presented by our subsidiary
Enersis) approved by the end of 2012.
Enel Brasil amounted to BRL$ 2,187 million.
> In July, Enel Américas and Enel Chile inaugurated their
> On December 29 Endesa Américas and Chilectra
offices in New York, whose main purpose is to manage
Américas ceased trading at the Santiago Stock Exchange
the relationships with institutional investor and financial
and the New York Stock Exchange, in the ADR form. As
analysts, credit rating agencies and institutions of the
securities markets in the United States (for example
Citibank, New York Stock Exchange-NYSE, etc.).
> On October 4, Enel Perú (100% owned by Enel Américas
S.A.) acquired 47,686,651 shares issued by the subsidiary
Enel Distribución Perú. The transaction closed at a total
price of PEN$ 262,276,580 (equivalent to approximately
US$ 80 million) and was carried out at the Lima Stock
Exchange.
> On September 27, Enel Brasil was awarded the
concession to operate Volta Grande power plant,
whose installed capacity is 380 MW. The amount of the
transaction reached BRL$1,420 million (US$ 445 million
approximately). This term of the concession is 30 years.
77
Company’s Business 13Investments and financial activities
78
Annual Report Enel Américas 2017 79
Letter from the Chairman Material Investments Related
to the Company’s Investment
Plan
The global financing strategy of the Group’s subsidiaries
and intercompany loans is coordinated in order to optimize
debt management, in addition to the terms and conditions
Outside Chile
Capital expenditures (1) (million US$)
2018-2020
5,233
2017
1,371
2016
1,230
2015
2,081
of our funding.
The Group’s subsidiaries develop independent capital
investment plans that are funded by funds generated
internally or by direct funding. One of our goals is to focus
on those investments that will yield long-term benefits,
such as projects to reduce energy losses. Additionally,
focusing on Enel Group and seeking to provide services to
all companies in the group, our goal is to reduce investment
at the individual subsidiary companies in elements such
as procurement systems,
telecommunications and
information systems. While we have studied how to
finance these investments as part of the budget process
of the Company, no particular financing structure has been
committed and our investments will depend on market
conditions at the time they need to get the cash flow.
(1) Capex figures represent the effective payments for each year,
with the exception of future forecasts.
Capital
expenditures
in 2017, 2016
and 2015
Our investment plan is flexible enough to adapt to the
three years were mainly related to El Quimbo project (400
changing circumstances by giving different priorities to
MW) in Colombia, and to the maintenance of the existing
each project according to its profitability and strategic
installed capacity. El Quimbo project began commercial
consistency. Investment priorities are currently focused
operations on November 16, 2015.
In the generation business, capital expenditures in the last
on developing the works plan in Brazil, Colombia and
Argentina.
In the distribution business,
investments were the
following: (i) expand our distribution service to meet
For the period between 2018 and 2020, we expect to spend
the growing energy demand, (ii) improve the quality of
US$5,233 million on a consolidated basis, in investments
service, (iii) improve safety, and (iv) reduce energy losses,
in the subsidiaries we control, and related to investments
particularly in Brazil.
currently under development, the maintenance of our
distribution networks, maintenance of existing generation
The aforementioned capital investments were financed as
plants, and the studies required to develop other potential
follows:
generation projects.
> El Quimbo: Local and international bond issuances.
The chart below shows the capital expenditures expected
to carry out from 2018 to 2020 and the capital expenditures
incurred by our subsidiaries in 2017, 2016 and 2015.
80
Annual Report Enel Américas 2017
Generation
enabled the expansion of the SE Pompeya, new feeders
SE Movil Roca, and technological improvements of the
RED (digitization).
Capital expenditures in generation amounted to US$ 253
million in 2017, and in 2016 totaled US$ 291 million.
In Peru, energy demand is related to requirements
from customers, which has generated investments in
In 2017 in Peru, maintenance capex reached US$ 61
distribution networks of US$ 75 million, US$ 37 million
million. Some of the main projects are: the reconstruction
of which were used for the expansion and reinforcement
of Callahuanca power plant (US$ 12 million), the acquisition
of networks to meet the requirements of residential,
of contingency parts for thermal units (US$ 11 million),
commercial and industrial customers, and US$ 28 million
several maintenance activities and the modernization of
to ensure quality and safety of the supply. With regards
civil works and hydraulic units (US$ 10 million), Project
to Sub-Transmission, investments in capacity expansion
for the Thermal Units Duality (US$ 4 million) and overhaul
and safety of the networks and transmission lines reached
of thermal units (US$ 8 million). Expansion capex were
US$ 33 million. Additionally US$ 7 million were assigned
focused on the TG6 project (US$ 8 million) and the HER
to Energy Losses Control and US$ 8 million to information
Huampaní Project (US$ 2 million).
services and infrastructure.
In Colombia, maintenance capex were focused on projects
In distribution in Brazil, total capex reached US$ 827 million.
related to the improvement of the generation plants’
In particular, Enel Río performed investments for a total of
assets, among which the beginning of the environmental
US$349 million for the implementation of new connections,
improvement plan for Termozipa stands out. In relation
improvement of the quality of distribution networks and
to expansion capex, progresses were made in the works
energy losses reduction projects. Enel Distribución Río
for the closing of El Quimbo hydroelectric project and the
performed investments in control systems through the
expansion capex of Termozipa.
use of technology and social activities. Investments of
Distribution
Enel Distribución Ceará totaled US$ 227 million with the
purpose of meeting the network demand and connections
of clients and support the sustained growth of demand
in the State of Ceará, including projects for the capacity
increase of energy transport. Enel Distribución Goiás
performed investments for a to total of US$ 250 million
During 2017, the Company’s capex amounted to US$
to meet the network demand and clients’ connections,
1,430 million, mainly to meet consumption needs, as
services for quality improvement and losses reduction.
a result of the growth of population and the entrance of
new customers, through investments not only related with
In Colombia, capex of Codensa reached US$ 266 million,
them, but also in capacity increases and strengthening
being mainly focused on projects that improve the quality
of AT, MT and BT of the companies. Conversely, in 2016
of service, energy losses control and new connections,
capex reached US$ 923 million.
with the objective of recovering quality and energy losses
During 2017 Edesur in Argentina carried out investments
Cundinamarca, and the replacement of network and
for US$ 213 million in order to meet the growth of demand
network assets in the Cundinamarca area after the merger
and improve the quality of service. These investments
process.
standards after the merger with Empresa de Energía de
81
Investments and Financial Activities Financial
activities
Finance
Finally, Peru recorded 2.6% growth in 2017, which is below
initial estimates, mainly explained by lower internal demand
and the slowdown of investments in fixed assets due to
political instability. Additionally, the country was affected by
heavy flooding caused by the El Niño climatological effect.
The latter brought an inflationary shock at the beginning of
the year and strong losses in the productive sector.
In the international macro scenario, the activity of developed
countries and some emerging economies have explained
During 2017 South America, and particularly the countries where
the greater dynamism and global growth in relation to
Enel Américas operates, experienced a positive economic
previous years, mainly in relation to the industry, by boosting
development and growth, but still below the estimated growth
global commerce and trading.
potential. As such, Argentina, Brazil, Colombia and Peru have
shown growth rates below 3%. Chile has been even lower
Central banks of the greater economies acted cautiously
with 1.5% growth of the economy in 2017.
during 2017 in relation to the gradual withdrawal from the
During the year, Argentina continued the policies for greater
recent and deep economic crisis. During 2017, financing
monetary stimulus, which was very helpful to overcome
commercial openness through reforms aimed at boosting
rates remained relatively low.
investment. Economic growth improved from a negative
2.3% in 2016 to a positive 2.9% in 2017, which reflects an
The financial markets kept open in the countries where Enel
improvement of internal conditions, mainly explained by
Américas has presence, which enabled its subsidiaries to
greater demand. However, inflation remained high at nearly
have access to the resources required to finance its projects
24%. In the financial area, rating agencies have supported
and investments and also to continue with debt refinancing
the improvement of economic growth projections through
at longer terms, thus complying with a policy that promotes
higher credit risk ratings. For example, in 2017 Moody’s
the control of financial risks.
rating agency increased the credit risk rating of sovereign
bonds from B3 to B2.
In 2017 Brazil has shown signs of economic recovery, moving
from a deep recession in 2016 where GDP decreased 3.5%,
to an estimated growth of 1% in 2017. This improvement
was driven by higher demand and investments, lower
inflation and therefore reduced interest rates. Moreover,
unemployment decreased and activity has shown signs of
economic recovery and greater dynamism. During the year
Brazil also was affected by the political instability of the
previous years, which even involved the President of the
Republic, bringing volatility to the markets.
In Colombia, 2017 was a year of slower economic activity.
Growth decreased from 2% in 2016 to 1.7% in 2017, the
lowest growth rate in 8 years. Lower dynamism, together
with the strong inflation reduction, led a fall of monetary
policy rate from 7.75% at its peak in 2016 to 4.75% by the
end of 2017. The political year was marked by the progress
in the peace process in Colombia with the incorporation of
guerrilla groups to civilian life.
82
Main completed
financial operations
For Enel Américas, 2017 was a year marked by expansion
and growth particularly in Brazil. The most important
milestones were the acquisition of the distribution
company Enel Distribución Goiás (previously Celg), located
in the state of Goias, and the awarding of the rights for
the concession to operate the hydroelectric generation
company Volta Grande, in the state of Minas Gerais. These
acquisitions meant the consolidation of the leadership of
Enel Group through Enel Américas in the region, while
consolidating significantly its presence in Brazil. In this
context, the companies of the Group carried out various
financing operations:
Annual Report Enel Américas 2017 Brazil
Enel Distribución Rio (Ampla) closed a bank financing
of BRL$250 million (US$76 million). Likewise, obtained
financing from Banco Nacional de Desenvolvimento
Econômico e Social (BNDES) for the development of its
investment program for a total of BRL $514 million (US$
155 million). Towards the end of the year, the company
performed a bond issuance of BRL$ 600 million (US$ 181
million) for bonds refinancing.
Enel Distribución Ceará
(Coelce)
issued short term
Promissory Notes in the local market of BRL$ 400 million
(US$ 121 million). The company also issued local bonds and
long-term infrastructure bonds towards the end of the year
of BRL$ 500 million (US$ 151 million), which were used for
the prepayment of Promissory Notes and for investments
financing.
Enel Fortaleza received a bank financing of BRL$ 190
million (US$ 57 million).
The
recently acquired distribution company Enel
Distribución Goiás received two bank financings of a total
amount of BRL $550 million (US$ 166 million).
Coverage Policy
Exchange Rate
The exchange rate hedging policy of the Group is based
on cash flows and seeks to maintain a balance between
flows indexed to foreign currency, and the levels of assets
and liabilities denominated in that currency. The goal
is to minimize the flows’ risk exposure from changes in
exchange rates. As part of this policy, the Enel Américas
contracted forwards for US$ 355 million to cover the flows
in different currencies coming from foreign subsidiaries.
The company also performed investments in financial
assets during the year, including among others the awarding
of the rights for the concession to operate the generation
power plant Volta Grande, with which the company needed
to contract hedging for US$ 369 million.
Overall, Enel Américas operated forward derivatives
contracts for more than US$ 720 million during 2017.
The new company of Enel Brasil group, EGP Projetos I,
obtained a bilateral bank loan of BRL$ 860 million (US$ 260
Interest rates
million) for the acquisition of the hydroelectric generation
Interest rates variations change the fair value of those
power plant Volta Grande.
assets and liabilities that accrue variable interest rate, as
Colombia
Codensa performed a local bond issuance of COP$ 630,000
million (US$ 211 million).
Peru
well as the future flows of asset and liabilities referenced to
a variable Interest rate. The objective of risk management
is to reach a balance of debt structure, in order to minimize
the cost of debt with reduced volatility in the income
statement. Depending on the Group’s estimations and the
objectives of debt structure, hedging transactions would
be made through derivatives contracts that mitigate those
risks. The instruments currently used are interest rate
swaps to fixed variable rates.
Enel Distribución Perú (Edelnor) performed a local bond
issuance of PEN $100 million (US$ 31 million). In addition,
By the end 2017, the comparative structure of financial debt
the entity signed two bank-leasing contracts for the
of Enel Américas Group in relation to fixed interest rate
financing of transmission lines and the construction of a
and/or protected interest rates versus gross total debt,
transmission substation of PEN$ 37 million (US$ 11 million).
after contracted derivatives was 46% of fixed rate debt.
83
Investments and Financial Activities
Credit Risk Rating
International Ratings
Enel Américas
S&P
Moody’s
Fitch
Corporate
BBB / Stable
Baa3 / Negative BBB+ / Stable
On November 9, 1994, Standard and Poor’s and Duff &
Phelps rated Enersis (today Enel Américas) for the first time
at BBB +, that is, an investment grade company. Later, in
Local Ratings
1996, Moody’s rated the company’s foreign currency long-
term debt at Baa1.
Over time, most credit ratings have changed. Currently,
they are all “investment grade”, which is based on the
diversified portfolio of assets, liquidity and adequate
policies of debt coverage service.
In summary, the following main events that took place in
2017 are detailed below:
On February 27, 2017, Standard & Poor’s reviewed and
Enel Américas
Feller Rate
Fitch
Stocks
Bonds
1st class, Level 2
1° class, Level 1
AA- / Stable
AA / Stable
Properties and
facilities
ratified the corporate rating of Enel Américas, assigning a
Enel Américas as a “holding” entity, does not directly own
“BBB” rating. Outlook is stable.
properties or facilities to develop its business.
Then, on July 25, 2017, Feller Rate rated Enel Américas
in local scale rating and assigned “AA-” rating with stable
outlook.
Furthermore, on September 13, 2017, Fitch Ratings assigned
Brands
international scale rating to Enel Américas in “BBB+” and
The company has registered “Enersis” and “Enersis
national scale the rating in “AA (cl)”, with stable outlook for
Américas” brands
in services, products,
industrial
both ratings.
and commercial facilities.
In July, 2016, through a
communication addressed to the Board of Enel Américas
Finally, on December 22, 2017, Moody’s reviewed Enel
S.A., Enel S.p.A authorized the free use of “Enel” brand
Américas rating and assigned a “Baa3” rating with stable
to Enel Américas S.A., being entitled to include it to its
outlook. Then, on February 23, 2018, the agency changed
business name, its logo and other forms of use.
the Outlook to negative due to the situation in Colombia.
Ratings are supported by the Company’s diversified
portfolio of assets, strong credit parameters, adequate
debt structure and high liquidity.
The brand “Enel Américas” is duly registered.
84
Annual Report Enel Américas 2017 Suppliers,
Customers
and Main
Competitors
SolutionsS.A.,Reivax Automacao e Control, Roberto
Carlos Castro & Cia Ltda., Balteau Productos Eletricos
Ltda., Energisa Solucoes S.A., Paradigma Business
Solutions As, Reivax S/A Automacao e Controle, Roberto
Carlos Castro & Cia Ltda, Banco Bankpar S.A, Cedae-
Estac. de Tratam de Agua – Dpt., Coop El Rural Cach
Itaborai, Prolagos S.A. Eta Juturnaíba, CRH Cantagalo,
Industria de Cimentos Telemar Norte e Leste S.A.,
State Grid, Aes, Cemig, Neoenergia, Light, Cagece Cia.
de Agua e Esgoto Do Ceara, Cogerh Barragem Do Rio
Maranguapinho, Cearaportos Cia. de Int Port Do Ceara,
Enel Américas S.A. in its capacity of a “holding” company
Seduc Colegio Liceu Do Ceara, Sesa 18 Cres Iguatu,
that mainly operates in the field of electricity generation
Ferbasa, Multiplan, Volkswagen, International Paper,
and distribution in Latin América, considers the following
Vicunha Têxtil, Chesf, Furnas, Eletronorte, Petrobras,
suppliers, customers and competitors as the most relevant
CEMIG, CTG Brasil, Copel.
ones for its main subsidiaries.
The Company established
that
its main suppliers,
S.A. E.S.P., Aes Chivor & Cia. S.C.A. E.S.P., Empresa
customers and competitors are the following:
de Energía del Pacífico S.A. E.S.P., Electrificadora Del
> Colombia: Empresas Públicas de Medellín E.S.P., Isagen
Caribe S.A, Compañía Energética del Tolima, Magaldi
> Argentina: Wartsila Argentina S.A., IMC SRL -Mei SRL
Power S.p.A., Consorcio Chivor, Ingenierias Triturados
– UTE, Zeppilli Enrique Félix, Turismo Patagonia S.A.,
y Concretos, Andritz Hydro Ltda., Carpi Tech BV
EMCO Limited, Argencobra S.A., Mor S.A., Rowing
Amsterdam Balerna Br, Empresas Públicas de Medellín,
S.A., Nizza Davidson Ing. y Obras S.R.L., Valtellina Sud
Cens S.A. E.S.P.,Electrificadora del Huila S.A., Empresa
America S.A., Imsa Sac E I, SIEMENS Energy Inc.,
de Energía de Boyaca, Ecopetrol, Productos Familia
Corrosión
Industrial Mantenimientos, Servimagnus
S.A., Cencosud, Eaab, Carvajal, Alumbrado Público
S.A. - SDC Do Brasil Serv., Hugo Torbidoni y Cía. S.R.L.,
Distrito Capital, Productos Familia S.A., Zona Franca
Techint Compañía Técnica Internacional, GCBA, AYSA
S.A., Iberplast S.A., Hilanderías Universal S.A., EEPPM,
S.A., Mun. Quilmes, Coto C.I.C.S.A. Suc, Metrovias
ISAGEN, DICEL, EPSA.
S.A., SADESA, AES, Pampa, Petrobras, YPF Energía (Ex
Pluspeteg).
> Peru: Indeco S.A., 3M Perú S.A., Hermes Transportes
Blindados S.A., CAM Servicios del Peru S.A., Silicon
> Brazil: Mechal Serv e Infraestrutura Ltd., Engeform
Technology S.A.C., Siemens Energy, Inc. Confipetrol.
Construcoes e Comercio Lt., Compel Construcoes,
Andina S.A., Servicios Generales Hidraúlicos y Cia.,
Endicon Eng. Instal e Construcoes, Soter Sociedade
Siemens S.A.C, Andritz Hydro AG, Luz del Sur, Minera
Técnica de Engenharia, Cia Gestao dos Recursos Hidricos,
Chinalco Perú, Hudbay Perú, Votorantim Metais
Alstom Ingegneria e Ricerca SÁ, Fundacao Ampla de
Cajamarquilla, Engie, Electroperú, Kallpa Generación.
Seguridade Social, ABDO, Ellery & Asociados Consult,
Statkraft, Corporación Celima, Lima Airport Partners
Energía Solucoes S.A., Antonio Esio Guerra Biserra, Nova
S.R.L., Compañía
Industrial Nuevo Mundo S.A.,
Rio Servicos Gerais Ltda., Rede Independente Jornais
Tecnologia Textil S.A., Gym Ferrovias S.A., Termoselva,
Do Nordes, Sintese Industria E Comercio Ltda, Loca
Coelvisac, Fénix Power Perú.
Buggy Automoveis - Carlos Agui, Paradigma Business
> Chile: Travel Security S.A., Merrill Lynch Pierce Fenner
& Smith, Deutsche Bank Securities Inc., Ernst & Young
Servicios Profesionales, DCV Registros S.A.
85
Investments and Financial Activities
14Risk Factors
86
Annual Report Enel Américas 2017 87
Letter from the Chairman Risk
Management
Policy
The companies of Enel Américas Group are exposed to
determined risks that are managed through the application
of a system to identify, measure, limit the concentration
and supervise.
Some of the underlying principles defined by the Group
in the establishment of their risk management policy are:
> Comply with the norms of good corporate government.
> Strictly complying with the normative system of the
Group.
> Each business and corporate area defines:
I.
The markets where the Company can operate
in relation to the knowledge and sufficient
capabilities to ensure effective risk management.
II. Criteria on counterparts.
III. Authorized operators.
Interest Rate
Risk
Interest rate variations modify the fair value of those
assets and liabilities that bear a fixed interest rate, and also
the aforementioned future asset and liabilities flows at a
variable interest rate.
The objective of risk management of interest rates
is to reach a debt structure equilibrium that allows a
minimization of cost of debt with a reduced volatility in the
income statement.
The Company performs coverage transactions through
derivatives contracts to mitigate these risks depending on
the estimations of the Group and the objectives of the debt
structure. The instruments currently used are interest rate
swaps that sets variable to fixed rate.
The comparative structure of the financial debt that Enel
Américas Group has, according to the fixed interest rate
and/or protected by the total gross debt, after contracted
derivatives, is the following:
> The business and corporate areas established for each
market in which they operate their predisposition to
coherent risk with the defined strategy.
Gross Position
> Every business operations and corporate areas are
performed within the approved limits in every case.
Fixed interest rate
12-31-2017
%
12-31-2016
%
46%
44%
> The business, corporate areas, lines of business and
companies establish risk management policies necessary
to ensure that the market transactions are completed
according to policy, norms, and the procedures of Enel
Américas.
88
Annual Report Enel Américas 2017 Exchange Rate
Risk
Commodities
Risk
Exchange rate risks fundamentally correspond to the
variation risks, mainly through the following:
following transactions:
> Fuel purchases in the process of electricity energy
The Enel Américas Group is exposed to commodities price
> Debt contracted by the Group’s companies denominated
generation.
in a different currency of which the flows are indexed.
> Energy purchase-sell operations that take place in the
> Payments to be made related to the acquisition of
local markets.
materials associated to projects and corporate insurance
policy payments being made in a different currency of
With the objective of reducing risk in situations of severe
which the flows are indexed, among others.
drought, the Group has designed a commercial policy
defining the level of commitment of energy sales according
> Revenues of the companies of the Group that are directly
to the generation capacity of power plants in a dry year,
linked with the evolution of currencies not related to the
including risk mitigation clauses in some contracts with free
companies’ flows.
clients. In the case of regulated clients, they are subjected
to a long-term tender process, and indexing polynomials are
> Flows from the subsidiaries abroad to the head offices
determined enabling the reduction of commodities exposure.
in Chile, which are exposed to exchange rate variations.
Considering the operational conditions that face electricity
With the objective of mitigating the exchange rate risk,
generation, hydrology, and commodities price volatility in
Enel Américas’ hedging policy for exchange rates is based
the international markets, the Company is permanently
on cash flows and contemplates to maintain a balance
verifying the convenience of taking coverage positions to
between the flows indexed in dollars and the levels of
reduce the impacts of price variations in results.
assets and liabilities denominated in that currency. The
objective is to minimize the exposition of the cash flows to
On December 31, 2017, the company signed operations of
variations in the exchange rates.
purchase future energy contacts 5.4 GWh, for the period
The instruments currently being used to comply with policy
selling contract in the Colombian wholesale market.
are currency swaps and exchange rate forwards. Likewise,
the policy seeks to refinance debt in the functional currency
On December 31, 2017, selling contracts for 24.23 GWh and
of each company.
purchase future energy contracts for 77.45 GWh were settled
January-March 2017. These purchases back up an energy-
On December 31, 2016, operations of purchase future
energy contracts amounted to 69.84 GWh, for the period
January-December 2017. These purchases backed up an
energy purchase contract in the wholesale market. For its
part, future energy sale contracts amounted to 15.12 GWh
in the period January-December 2017, associated with
the coverage of cash flow risks of clients indexed in the
Unregulated Market. As of December 31, 2016, ten sales
contracts and one future energy purchase contract were
liquidated, each of them amounted to 0.36 GWh.
89
Risk Factors Liquidity Risk
The Group maintains a liquidity policy consistent with
the contract of committed long-term credit facilities and
temporary financial investments, in sufficient amounts to
support the projected needs for a period of time related
to the context and expectations of the debt and capital
markets.
Receivable
Commercial
Accounts
With regards to credit risk related to the receivable accounts
coming from commercial activity, this risk is historically very
The aforementioned projected needs include net financial
limited given the short term client’s recovery time, so they
debt maturities, after financial derivatives (For further details
do not individually accumulate a significant amount. This is
regarding the features and conditions of financial debt and
applicable for both our electricity generation and distribution
financial derivatives see Notes 19, 21 and Appendix 4 of
businesses.
the 2017 Financial Statements).
In some countries in our line of business of electricity
As of December 31, 2017, the liquidity of Enel Américas
generation, the company may face a supply disruption due
Group reached US$1,473 million in cash and cash
to the lack of payment, and also in almost every contract
equivalents, and US$225 million in available non-committed
it’s considered lack of payment as cause for terminating the
long-term credit facilities. On December 31, 2016, the
contracts. For this end, the credit risk is constantly monitored
Enel Américas Group accounted a liquidity of US$2,689
and its measured in maximum amounts exposed such risk.
million in cash and cash equivalents, and US$130 million in
In the case of our electricity distribution companies, the
available long -term uncommitted credit facilities.
supply disruption in all cases is our company’s decision
facing our client’s lack of payment. This is implemented
according to the existing regulation in each country, which
facilitates the evaluation process and credit risk control,
which is also limited.
Credit Risk
Enel Américas performs a detailed monitoring of its credit
risk.
Financial Assets
Cash surplus investments are made by top of the line
national and international financial entities, with limits
established by each institution.
In the bank selection for investments, the ones considered
are those that have an investment grade credit risk rating,
considering the three main international rating agencies
(Moody’s, S&P and Fitch).
Placements can be backed up by treasury bonds of the
country where the operation takes place and/or bank
securities issued by top of the line banks, privileging the
latter because they offer greater returns (always following
the existing placement policies).
90
Annual Report Enel Américas 2017
Measuring
Risk
Other Risk
Factors
The Enel Américas Group develops a Value at Risk
Some South American economies have historically
measurement for its debt positions and financial derivatives,
been characterized by frequent and, occasionally
with the objective of monitoring the risk assumed by the
drastic, interventionist economic measures by their
company, limiting the volatility of the income statement.
governmental authorities
including expropriations,
which may adversely affect the business and financial
The portfolio includes for the calculation of the Value at Risk
results of Enel Américas.
composed by:
> Financial Debt.
Government authorities have modified monetary, credit,
tariff, tax and other policies with the purpose of influencing
> Derivatives for Debt coverage.
the direction of the economies of Argentina, Brazil,
Colombia and Peru. Although Enel Américas has no assets
The calculated Value at Risk represents the possible variation
in Chile, it’s a company constituted under the laws of the
of the portfolio’s value previously described in the duration
Republic of Chile. Therefore it’s subject to changes in tax,
of a quarter with 95% confidence. For that purpose there is
labor and monetary laws, among others. Other government
a volatility study of the risk variables that affect the position
actions carried out in these South American countries have
portfolio’s value, including:
also included wages, process and tariffs controls, and
other interventionist measures such as expropriation and
> Libor for the US dollar.
nationalization.
> The different currencies in which our company operates,
the regular local indexes for banking transactions.
In the distribution business, if a certain service and technical
> Exchange rates of the different currencies considered in
standard is not met, there is a risk of losing concessions.
the calculations.
In some concessions, such as Buenos Aires and Rio de
Janeiro, it may be especially difficult to meet some of the
The Value at Risk calculations are based on the extrapolation
minimum standards required. In the event that it is not
of future scenarios (in one quarter) of the market values
possible to comply with these regulatory standards, the
of the risk variables in terms of the scenarios based on
local power regulator might revoke the concession and
real observations for the same period (quarter) during five
reallocate it to a competitor.
years.
Changes in government and monetary policies on tariffs,
The Value at Risk of a quarter with a 95% of confidence is
exchange controls, regulations and taxation may reduce
calculated as a 5% percentile more adverse of the possible
the profitability of the Company. Inflation, devaluation,
variations in the period.
social instability, and other political, economic or diplomatic
Considering the hypothesis described above, the Value at
the region’s governments, may also reduce the Company’s
events, including the response to these circumstances by
Risk in a quarter of the positions described corresponds to
profitability.
US$ 212,497 thousand.
This value represents the potential increase in the debt and
extent on hydrological conditions, drought conditions,
derivatives portfolio, so this value at risk is directly related,
flooding and other weather conditions may adversely
among other factors, to the value of the portfolio at the end
affect the operations and profitability
Since the Company’s businesses depend to a large
of each quarter.
91
Risk Factors In 2017 approximately 55% of the consolidated installed
Operational costs of thermoelectric plants can be
generation capacity was hydroelectric. As such, the
considerably higher than the costs of hydroelectric plants.
extreme dry hydrological conditions can adversely affect
Operational expenses
increase considerably during
the Company’s business, the operational results and its
drought periods, when thermoelectric power plants are
financial condition. The hydrological condition of the region
dispatched more frequently. Also, depending on our
has been frequently affected by two weather phenomena
commercial commitments, we may have to purchase
—“El Niño” and “La Niña”— which had an impact on rains
electricity from the spot market in order to comply with
and have resulted in droughts, affecting the Company’s
all our contractual supply obligations and the cost of these
ability to distribute energy from its hydroelectric facilities.
purchases of electricity may exceed the price at which we
In Brazil, where 76% of the Company’s installed capacity is
must sell the contracted electricity, thus causing losses for
hydroelectric, authorities were forced to make regulatory
these contracts.
changes by modifying the maximum price limit, which
is reviewed annually and is consequence of the low
Droughts also have an effect on the operation of
hydrological contributions registered since 2014; the latter
thermoelectric power plants, including facilities that use
also had a direct impact in the short-term electricity market
natural gas, diesel, or coal as fuels, as follows:
resulting in an increase of thermal dispatch and spot prices.
The Brazilian regulation considers a relocation mechanism
•
Thermal plants require water for cooling and droughts
that allow hydroelectric generators with energy deficit to
not only reduce the availability of water, but also
buy energy at the prices established by other generators
increase the concentration of chemicals such as
with superavit; nevertheless, due to the existing drought,
sulfates in water. The high concentration of these
every energy generation company had deficits in relation
chemicals in the water used for cooling increases the
to their supply contracts, therefore these companies were
risk of damage to the equipment of the thermoelectric
forced to buy energy in the spot market at higher prices,
plants, as well as the risk of infringing relevant
approximately BRL$ 10 per MWh, which is against the
environmental regulations. As a result, water may
price limits established for 2017 and 2018 of approximately
have to be purchased from agricultural areas, which
BRL$ 12 per MWh.
are also experience water shortages. These water
purchases can increase the operational costs and
Likewise, the “El Niño” phenomenon has affected
force the negotiation with local communities.
hydrological conditions in Colombia in the past, where
88% of the installed capacity is hydroelectric, leading to
•
Thermal power plants that burn natural gas generate
a scarcity of precipitations and high temperatures during
emissions such as nitrogen oxide (NO), carbon
the period, and therefore to an increase in energy prices.
Each event of “El Niño” is different and, depending on
its intensity and duration, the magnitude of its social and
economic effects can be more material. Peru has also
experienced a shortage of rainfall, especially towards the
dioxide (CO2) and carbon monoxide (CO) gases. When
operating with diesel they release NO, sulfur dioxide
(SO2) and particulate matter into the atmosphere.
Coal fired plants generate emissions of SO2 and NO.
Therefore, greater use of thermal plants during periods
end of 2016 and high volatility of hydrologic conditions
of drought generally increases the risk of producing a
during 2017. Even though the installed capacity in Peru is
higher level of pollutants that could lead to penalties if
mainly thermoelectric, extreme hydrological events have
emissions are above certain levels.
affected non-thermal power plants. In March 2017, “El
Niño Costero” phenomenon in Peru caused unusually
The recovery from the drought that affected the regions
heavy rains that caused the temporary stoppage of
where most of the hydroelectric power plants of the
several hydroelectric power plants due to the overflowing
company are located can last for a prolonged period of
of rivers, and by the end of the year river levels that feed
time and new episodes of drought may occur in the future.
power plants were below historical average levels. These
A prolonged drought may exacerbate the risks described
situations explain the high volatility of marginal costs.
above and have an adverse effect on Enel Américas
business, operational results and financial condition.
92
Annual Report Enel Américas 2017 The distribution business is also affected by climatic
Electricity businesses may be subject to regulatory fines
conditions. For example, moderate temperatures may
for any breach of current regulations, including power
decrease the use of heating or air conditioning, thus
outages, in the four countries in which the Company
affecting energy consumption. Even under extreme
operates.
temperatures, demand can increase significantly in a short
period of time, which could affect service and result in
The generation subsidiaries of the Group are supervised
an interruption of supply with the additional risk of being
by local regulators and may be affected by these fines in
fined by the authorities. Depending on weather conditions,
cases where, in the opinion of the regulator, operational
the results obtained by the distribution business can vary
failures that affect the regular supply of energy to the
significantly from year to year.
system are the responsibility of the company as when, for
Government regulation may adversely affect the
system operator. In addition, subsidiaries may be required
example, there is no coordination of the agents with the
Company’s business.
to pay fines or compensate customers if subsidiaries
can’t provide electricity, even if such non-compliance is
Enel Américas’ subsidiaries are subject to extensive
due to forces beyond the subsidiaries’ control, or if they
regulations on tariffs that are charged to its clients and
don’t comply with environmental or other regulation. As
other aspects of the business, and these regulations may
of December 31, 2017, fines imposed to Enel Distribución
have an adverse impact on the Company’s profitability.
Ceará amounted to the equivalent to US$ 23 million and
For example, governments in the countries where the
were related to 49 fines imposed by various reasons,
Company operates may implement rationing policies
including relationships with clients, non-compliance with
during droughts or prolonged failures in rationing services,
regulations and environmental standards, non-compliance
which could adversely affect the Company’s business,
with labor regulations and with fiscal rule.
operational results and financial condition.
Government authorities could delay the distribution tariff
on payments from its subsidiaries and associate
To meet payment obligations, Enel Américas depends
revision process, or the tariff adjustments determined
companies.
by the authorities could be insufficient to pass the costs
to clients, as was the case in Edesur, our distribution
In order to pay its obligations, the Company depends in
subsidiary in Argentina, between 2008 and January 2017,
part on the cash received from dividends, loans, interest
and currently with Codensa, our Colombian distribution
payments, capital reductions and other payments from its
subsidiary, whose tariff revision was scheduled for
subsidiaries. The ability of subsidiaries to pay dividends,
2015 and was implemented in January 2018. Similarly,
interest and credit payments, and deliver other distributions
electricity regulation issued by government authorities in
is subject to legal limitations, such as dividend restrictions,
the countries where the Company operates may affect
fiduciary duties, contractual restrictions that may be
the ability of supplying companies to obtain revenues that
imposed by local authorities.
offset operational costs.
The inability of any consolidated company from the Group
access its subsidiaries’ cash flows at all times due to
to obtain sufficient revenues to cover its operating costs
certain government regulations, strategic and economic
may affect the Company’s ability to operate as a start-up
considerations, and credit restrictions.
Historically, the Company has not always been able to
firm and may otherwise have an adverse effect on the
business, operational results and financial condition.
Future operational results may continue to be subject
Regulatory authorities may impose fines on the
governmental regulations, economic conditions and credit
Company’s subsidiaries due to operational failures or
restrictions, therefore reducing the likelihood of being able
non-compliance of regulations.
to rely on cash flows of those entities’ operations for the
to greater economic and political uncertainties, such as
Company’s debt payment.
93
Risk Factors Limits on dividends and other legal restrictions. Some of
Enel Américas is currently involved in several litigations
the subsidiaries are subject to legal reserve requirements
that can conclude in unfavorable decisions of financial fines
and other restrictions on dividends payment. Other legal
for the Company. For example, in 2016 three claims against
restrictions, such as currency controls, may limit the
Celg (Enel Distribución Goiás) recall that the privatization
ability of subsidiaries and associates to pay Enel Américas
process was illegally executed and demands the nullity
dividends, and amortize credits or the Company will
of the process and also compensation. Plaintiffs include
distribute other distributions. Furthermore, the ability of
BNDES and the IFC. The main risk of this litigation is the
any of the subsidiaries that are not wholly owned by Enel
loss of concession of Enel Distribución Goiás from Enel
Américas to deliver cash payments may be limited by the
Brasil. As of the date of this Report, legal proceedings are
fiduciary duties of the directors of such subsidiaries to
pending. Therefore, there is neither an estimation of the
minority shareholders. Moreover, some of the subsidiaries
potential loss nor an associated provision. The resolution
may be required by local authorities, in accordance with
of cases can take up to ten years. Enel Distribución Goiás
applicable regulations, to reduce or eliminate the payment
is also involved in tax litigation for claims originated in a
of dividends. As a result of such restrictions, any subsidiary
period previous to its privatization, and this claim can not
may, under certain circumstances, be prevented from
only have an adverse effect in the Group, but also deplete
delivering cash to Enel Américas.
resources and attention for many years.
Contractual Obligations. The restrictions for dividends
Enel Américas might continue to be subject to future
distribution include credit agreements that the subsidiary
litigations that may have adverse substantial consequences
Enel Generation Piura can prevent the payment of dividend
for the business.
and other distributions to shareholders if they are in non-
compliance of certain financial ratios. In general, the credit
The financial condition or operating results of Enel Américas
agreements ban any type of distribution in the event of
could be affected if it’s unsuccessful in the litigation defense
non-compliance underway.
or other lawsuits that are filed against the Company. For
further information on litigations, see Note 34.3 of the
Subsidiaries’ Operating Results. The subsidiaries and
Notes of the Consolidated Financial Statements.
associate companies capacity to pay dividends, credit
amortizations or to deliver other distributions that Enel
Environmental regulations in countries where the
Américas is limited by its operational results. As long as
Company operates and other factors can cause delays,
the cash needs of any subsidiary overcome their available
hinder the development of new projects, or increase
cash flow, said subsidiary will not dispose of the cash to be
the costs of operating and general capital expenditures.
delivered to the Company. This is the situation that affected
Enel Distribución Río and Enel Brasil as a consequence of
Operating subsidiaries are subject to environmental
the economic and political situation in Brazil.
regulations, which, among other things, require the
Additionally, the currency of any dividend paid by our
future projects and obtain permits from regulatory entities,
subsidiaries is subject to depreciation in comparison to our
local and national. The approval of these environmental
functional currency, which will have a negative impact on
impact studies may take longer than planned, and also, can
our capacity to pay dividends to shareholders.
be retained by governmental authorities.
Company to conduct environmental impact studies for
Any situation described beforehand could adversely affect
Those projects that require consultation of local interested
the operational results and the financial condition.
parties for its evaluation process can be rejected or its
Enel Américas is involved in litigations, especially in
of the company also can request precautionary measures
development may be impeded or delayed. Stakeholders
Brazil.
94
or other type that may negatively affect the Company if
Annual Report Enel Américas 2017 successful in their demands. Additionally, projects that
The operations of existing thermal plants of Enel Américas
don’t require consultation with local interested parties may
can also affect the prestige facing stakeholders due
be subject to intervention or suffer continuing resistance,
to emissions such as particulate matter, sulfur dioxide
delaying its approval process or development.
and nitrogen oxides, which could adversely impact the
In the case of the existing facilities, stronger regulations in
environment.
the four countries where the Company has investments,
The reputation damages may place considerable pressure
bear a significant risk of non-compliance so it has been
on regulators, creditors, and other stakeholders, and lately,
necessary to create teams specialized in compliance
the fact that projects and operations are being carried out
regulation and the maintenance of a closer technical
is not optimal, creating a fall in share price, and hinder the
relationship with the authorities
in order to better
capacity to attract or retain good employees, which results
understand the possible implications.
in the damaging of the Company’s reputation with these
The delays or modifications of any proposed project, and
stakeholders.
the laws or rules that can change or be interpreted in a way
Political developments or financial crisis or any other
that can adversely affect the operations or plans for the
crisis anywhere in the world may have a substantial
companies in which the Company has investments, which
impact in the countries where Enel Américas operates
can adversely affect its business, operational results, and
and therefore might negatively affect operations and
the financial condition.
liquidity.
The four countries where the company operates are
Power plants’ projects that can face a significant
vulnerable to external impacts, including financial and
opposition from different groups can delay progress,
political events, which may cause important economic
raise costs, hurt reputation, and potentially, result in
problems and impact growth. If any of these economies
image deterioration when facing stakeholders.
would experience lower economic growth than expected
or recession, it’s likely that clients would demand lower
Reputation is fundamental to the relationship with the key
electricity and some of them might face difficulties to pay
stakeholders and other interested parties. If the Company
the electricity bill, and probably the uncollectible accounts
does not have the capacity to effectively manage, real
of the Company would increase. Any of these situations
problems or perceive those that can negatively affect
may negatively affect operational results and financial
opinions towards the Company, the business, operational
situation. Any political scandal may indirectly affect the
results, and financial conditions can be affected in an
economy of the country.
adverse way.
Political or financial developments in other places in the
Most of the countries have adopter rules for consultation
world would also adversely affect the business of the
with local stakeholders in the initial phase in order to
company. For example, the presidential elections in the
avoid any risk of conflict and to minimize the impacts
United States in 2016 significantly increased the volatility
in the power plants. The construction of power plants
of global financial markets due to the uncertainty of political
before the adoption of these rules that weren’t subject
decisions. The new policies of the United States would
to local consultation may face the opposition of diverse
affect world markets and global commerce and could result
interest groups, such as ethnic groups, environmentalists,
in a renewed volatility, especially in commodities prices.
landowners, farmers, local communities, and political
Likewise, instability in the Middle East or in any other
parties, among others. The management of these conflicts
important fuel producer region, may also cause higher fuel
may result in plant stoppages and legal costs.
prices worldwide, which also would increase fuel costs
95
Risk Factors for thermal power plants and adversely affect operational
to request for exemptions for repayment of some debt
results and financial condition. Even in the case of a
agreements or, to some extent, to request collaterals
temporary shut-down of the United States government,
or other emergency measures from Enel Américas as
such as the one that took place in early 2008, or the threat
shareholder, including extraordinary capital increases.
of another one since February 8, 2018, may have a very
adverse effect in time, execution and higher expenses
The occurrence of future adverse events
in these
related to the main transactions and reorganizations
economies may hinder the ability to carry out strategic
involving ADS holders and the SEC in the United States.
plans, which eventually would affect adversely operational
results and financial condition.
Moreover, an international financial crisis and its negative
effect in the financial industry might have an adverse
Moreover, in South America the financial and securities
impact in the ability to obtain new banking financing in the
markets are influenced in different degrees by economic
historical terms and conditions.
and market conditions of other countries, which may
Political or financial developments of other kind may also
decrease the capacity to access the capital markets in the
The construction of power plants may suffer delays
adversely affect the value of the company’s securities.
countries where the company operates, as well as the
and significant cost over-runs
international capital markets for other liquidity sources, or
raises of interest rates offered to the Company. In turn,
Power plants projects can be delayed in obtaining regulatory
reduced liquidity, may affect capital expenses, long-term
approvals, or may face the shortage of equipment or
investments and acquisitions, growth perspectives and
workforce, and also can be subject to construction delays,
dividends policy.
strikes, adverse weather conditions, natural disasters,
social conflicts, accidents or human errors.
Economic fluctuations in South America may affect the
operations and financial condition and the value of the
Existing markets conditions in the initial phase of the
securities of the company
project’s approval might be totally different to the existing
ones when the Project is completed, therefore in some
All the operations of Enel Américas are located in the
cases these projects could be commercially unfeasible.
four countries of South America. Therefore, consolidated
Such is the case of many existing projects of the Company,
revenues may be affected by the performance of South
which were initially planned under totally different market
American economies as a whole. If local, regional or global
conditions, when energy prices were high and competition
economic trends adversely affect the economy in any of
was lower. Currently the competition has increased due to
the four countries where the company has investments
the entrance of NCRE generation. If these assumptions are
or operations, the financial condition and operational
not taken into account, including the forecast of deadlines
results may be negatively affected. The Company has
and the estimation of expenses related to these projects, it
investments in Brazil, a relatively volatile economy, which
might result in cost overruns and execution periods greater
has experienced political instability due to the scandals
than estimations, which in turn could have a negative
of corruption of 2015 and afterwards involved several
effect for the business, operational results and financial
government officials, including the president, whose
situation. The adequate sites to develop new projects
impeachment led to the forced termination of her term in
are sometimes in greatly challenging areas in terms of
2016.
geographical topography, and in some cases in mountain
slopes or inside jungles with limited access. These factors
Insufficient cash flows of subsidiaries located in countries
also can provoke significant delays and excessive costs.
with volatile economies have led, in some cases, to their
inability to comply with financial obligations and the need
It’s possible that the Company may not be able to
make the appropriate acquisitions.
96
Annual Report Enel Américas 2017 The Company constantly verifies acquisitions prospect
Even though the functional currency is the US dollar,
that can increase market coverage or complement existing
the subsidiaries generate revenues in Argentine Pesos,
businesses, although it cannot ensure that appropriate
Nuevos Soles, Brazilian reais and Colombian pesos.
procurement transactions can be identified and specified in
the future. The acquisition and integration of independent
In general, the Company significantly has been and
companies that are not controlled by Enel Américas is
continues to be exposed to the fluctuations of local
generally a complex, time-consuming and expensive
currencies with respect to the dollar.
process. If an additional acquisition is made, such as the
ones carried out in 2017 in Brazil, Enel Distribución Goias
Due to this exposure, cash generated by the subsidiaries,
(Celg) in February 2017 and Volta Grande in November
expressed in dollars, may substantially decrease when
2017, it may be that there are significant debts incurred and
local currencies are devalued with respect to the dollar. The
liabilities assumed, the potential loss of key employees,
future volatility in exchange rates in currencies in which
depreciation expenses related to tangible assets and the
the Company receives revenues or in which incurs costs,
distraction of management from other business concerns.
can affect the business, financial condition, and operating
Additionally, any delay or difficulty related to the acquisition
results, especially when expressed in US dollars.
and integration of multiple transactions could have an
adverse effect on the business, financial condition or its
Long-term energy sales contracts are subject to
operational results.
fluctuations of the market price of certain commodities
The business and profitability of Enel Américas may be
and other factors.
adversely affected if water rights are rejected or water
Enel Américas is economically exposed to market price
concessions are granted for a limited time.
fluctuations of certain commodities due to long-term
energy contracts. As selling counterparts, subsidiaries
The Company owns water rights over river and lakes
have material obligations due to the long-term energy
located in the vicinity of its generation facilities, which
contracts at a fixed payment. The prices of these contracts
were granted by the authorities of the respective countries.
are indexed at the value of different commodities,
In Colombia, the water rights or water concessions are
exchange rates, inflation, and the market electricity prices.
granted for periods of 50 years and are renewable for the
Adverse changes to these rates could reduce the fees that
same period; however, these concessions can be revoked,
a reasonably applied to the electricity sales contracts in the
for example, when there is a progressive decrease or
long term at a fixed price, which could adversely affect the
depletion of the waters. In Colombia, the access to water
operational results and financial condition.
for human consumption is the first priority before any other
use. In Peru, water concessions are granted for indefinite
In the countries, where clients can freely choose non-
periods, and can be revoked due to scarcity or a decline in
regulated tariffs, including Peru, this choice may be
service quality.
harmful for operating revenues that the Company would
have received in a regulated regime. In some cases, clients
Any limitation to current water rights, the need to obtain
may choose an alternative supplier of energy, which would
additional water rights, or the current unlimited water
negatively affect the business, operational results and
concessions could have a material adverse effect over the
financial situation.
hydroelectric development projects and profitability.
Exchange risks could adversely affect the results and
influence over Enel Américas and may have a different
the value in dollars of the dividends paid to the ADS
strategic vision than the minority shareholders when it
holders.
comes to the development of the Company.
The controlling shareholder could have substantial
97
Risk Factors As of December 31, 2017, Enel Spa (Enel) owns 51.8% of
The Company is subject to financing risks, such as
the share capital of Enel Américas. Enel, the controlling
those related with the financing of new projects and
shareholder, can determine the results of almost every
capital expenditures, and the risks related to the
important issue that requires a shareholder vote, as is the
refinancing the maturing debt; it’s also subject to the
appointment of the majority of members in the Committee
compliance with debt obligations, all of which could
and, subject to legal and contract restrictions, the dividend
adversely affect liquidity.
policy. Enel can also exert influence over the operations
and strategy of the business. Its interests may, in some
As of December 31, 2017, the Company’s consolidated
cases, differ from the minority shareholders interest. For
debt amounted to US$ 5,004 million.
example, Enel carries out its commercial operations in a
field of renewable energy in South America through the
The maturity profile of consolidated financial debt is the
company Enel Green Power S.p.a., in which the company
following:
has no capital interest. Any present or future conflict of
interest that may affect Enel could be solved against Enel
• US$ 671 million in 2018;
Américas interests, for these materials. Therefore, growth
• US$ 1,742 million from 2019 to 2020;
may be potentially limited and the business and operating
• US$ 986 million from 2021 to 2022; and
results may be seen affected adversely.
• US$ 1,605 million onwards.
The electricity business is exposed to risks arising from
Below is a breakdown of the debt maturity in 2018 by
natural disasters, catastrophic accidents, and acts of
country:
terrorism, which could adversely affect the operations,
• US$ 289 billion for Brazil;
revenues and cash flows.
• US$ 266 million for Colombia;
• US$ 102 million for Peru;
The Company’s main facilities include power plants,
• US$ 11 million for Chile; and
transmission and distribution assets. Earthquakes, floods
• US$ 3 million for Argentina.
or fires may damage the Company’s facilities, and other
catastrophic disasters caused by nature or by human
Some of the debt contracts are subject to: (1) financial
action, as well as acts of terrorism, vandalism, and riots.
covenants, (2) affirmate and negative covenants, (3) events
A catastrophic event could lead to business disruption,
of default, (4) mandatory prepayment events for breach of
resulting in significant reductions in revenues due to lower
contractual conditions, and (5) certain clauses for change of
demand or significant additional costs not covered by
control by significant mergers or divestments, among other
insurance terminations for business interruptions. There
provisions. A significant portion of the Company’s financial
may be delays between the occurrence of a significant
debt is subject to cross-default clauses that have varying
accident or a catastrophic event and the definitive
definitions, criteria, materiality thresholds, and applicability
reimbursement of Enel Américas insurance policies, which
in the subsidiaries in which such cross-breach would arise.
normally contemplate a deductible and are subject to
maximum amounts per claim.
In the event that Enel Américas or its significant subsidiaries
breach any of these material contractual provisions,
For example, in March 2017, “El Niño Costero” phenomenon
debtholders may demand immediate repayment, and a
in Peru caused unusually heavy rains that caused the
significant portion the debt may be due and payable. For
temporary stoppage of several hydroelectric power plants
example, a result of the economic and political situation
due to the overflowing of rivers, such as Callahuanca (81
in Brazil, Enel Distribución Río has been facing financial
MW) and Moyopampa (69 MW). Five power plants ceased
problems which has led to a lower demand for electricity,
temporarily operations on March 16, 2017, and one of them
higher costs due to inflation and a deterioration of cash
is still out of service.
flows and EBITDA. Enel Distribución Río had to renegotiate
98
Annual Report Enel Américas 2017 some of its financial covenants between December 2015
that are not related and are operated independently.
and January 2016, in order to avoid a breach of contract.
This dependency exposes the Company to severe risks.
There is an additional risk of covenant non-compliance if the
If the transmission is interrupted or the transmission
economic environment in Brazil continues to deteriorate. In
capacity is inadequate, it can impede a sale and delivery
March 2016, as a result of the credit deterioration of Enel
of electricity. If the energy transmission infrastructure in a
Distribución Río, had to guarantee a 3-year bank loan from
region is inadequate, the recovery of costs and profits can
Enel Distribución Río for US$ 75 million. Later, in July
be insufficient. If restrictive price regulatory transmission
2016, we granted intercompany loans to Enel Brasil for its
norms are imposed, the transmission companies that the
financial stability.
entity supports may not have enough incentives to invest
in the infrastructure expansions in transmission, which
It’s possible that the Company would not be able to
could adversely affect operations and financial results.
achieve debt refinancing or obtain such refinancing in
The construction of new transmission lines may take
terms that are acceptable to the company. In the absence
longer time than in the past, mainly due to new social
of such a refinancing, Enel Américas could be forced to
and environmental demands that are creating uncertainty
dispose of assets in order to make overdue payments
about the possibility of completing the projects. Also,
of its indebtedness under circumstances that could
the increase in new NRCE projects congests the current
be unfavorable to obtain the best price for such assets.
transmission system, since these are projects of fast
Moreover, it’s possible that the assets could not be sold
construction, while the new transmission processes can
fast enough or at high enough amounts to enable such
take longer to be constructed.
payments to be made.
The Company also depends on gas pipelines to obtain
Another scenario is that Company may not have the capacity
natural gas, mainly in Peru, country whose most of
to obtain the required financing to complete the projects
the installed capacity is thermal. The Peruvian system
under development or under construction. Existing market
faced congestions of gas and energy due to the lack of
conditions when requiring the funds or other unplanned
installed capacity of gas pipelines and transmission
cost over-runs may compromise the ability to finance these
lines, respectively, resulting in higher spot prices. From
projects and investments.
2008 to October 1, 2017 there was a spot prices limit,
but restrictions to transmission lines and gas pipelines
As of the date of this report, the Company considers that
pressured Peruvian authorities to enforce a special model
Brazil is the country with the highest refinancing risk. As
for spot prices calculation. The maximum price was
of December 31, 2017, the third-party debt of the Brazilian
US$95 per MWh. Even though the maximum price was
subsidiaries of Enel Americas amounted to Ch$ 1,715
originally established due to the gas pipeline restrictions,
million. The incapacity to finance new projects or capital
the lack of transmission capacity, mainly in the south of
expenditures or to refinance the Company’s existing debt
Peru, expanded the use the maximum price determination
could adversely affect operating results and its financial
model. During the first half of October 2017, in the absence
condition.
of a maximum spot price and due to the delay in the
commissioning of the new transmission line, spot prices
Enel Américas trusts in the electricity transmission
were unusually high in the south of Peru (the maximum
facilities that are not their property neither in their
price was US$180 per MWh and simultaneously, very low
control. If these facilities do not provide a proper
in the central area of the country. It wasn’t possible to
transmission service, it can impede the energy delivery
dispatch excess energy of the central region to the south
sold to final clients.
of Peru). Similar situations might happen in the future, and
also in other countries where the company operates, and
In order to deliver the electricity sold, the Company depends
thus impact operational results.
on the transmission system property of other companies
99
Risk Factors Any interruption, failure or lack of transmission facilities
The business can experience adverse consequences
may discontinue the business or affect market prices,
if it does not have the ability to reach satisfactory
which can in turn adversely affect operational results and
agreements in the collective negotiation contracts
financial condition.
with the unionized workers and retain key employees.
Thermoelectric generation facilities in the four countries
A large percentage of the employees are members of a
where the Company operates purchase gas, coal, diesel
union that has collective negotiation contracts that need
and other fuels to generate electricity, depending on the
to be regularly renewed. The business, financial condition,
technology of the respective power plants. Any contractual
and operational results of Enel Américas could be adversely
breach or supply shortage may prevent the facilities from
affected in the case that an agreement cannot be found
producing electricity in a timely manner.
with any of the unions that the employees represent, or by
an agreement with the trade union that contains conditions
For example, our subsidiary Fortaleza owns and operates
that Enel Américas finds unfavorable. The laws in the
a gross 327 MW natural gas combined cycle power plant,
various countries where the Company operates establish
whose capacity supplies one third of the power demand of
legal mechanisms for the judicial authorities to impose
8.8 million people in the State of Ceará in Brazil. In order
work contracts if the parts are not capable of reaching
to generate electricity and fulfill its energy commitments,
an agreement, which can increase costs from what was
Fortaleza maintains a contract with Petrobras, the Brazilian
budgeted.
company appointed by the federal government to supply
natural gas in accordance with the Thermoelectric Priority
Additionally, some employees have highly specialized
Program (“PPT”, in its Brazilian acronym) created in 2000.
abilities and certain actions such as strikes, walk-outs or
In accordance with the terms of the PPT, the gas supply
work stoppages by those employees could adversely
to Fortaleza would be guaranteed for 20 years from 2003,
impact the business performance, operational result, and
at a price defined contractually. The main purpose of the
financial, as well as the Company’s reputation.
contract is to avoid a short-term energy crisis ensuring
thermoelectric generation due to the vulnerable situation
The relative lack of liquidity and volatility in the
of hydroelectric facilities exposed to weather conditions.
Chilean securities market and its dependence on the
In September 2017, after 15 years of delivering supply,
economical conditions in Latin America and other
Petrobras informed Fortaleza its intention to terminate
parts of the world, could negatively affect stock prices
the contract based on the existing inequality between the
and the company’s ADS.
contractual price and the current market conditions. In
December 2017, date on which the gas supply should be
Even though the Company does not own assets in Chile,
discontinued, the court issued a legal order guaranteeing
its stocks are listed in the Chilean Stock Market, for which
the natural gas supply to Fortaleza from Petrobras.
Enel Américas is regulated under the laws of the Republic
Nevertheless, in February 2018, the court cancelled the
of Chile, as well as being placed in Chile. The Chilean stock
order and Petrobras notified Fortaleza that the gas supply
markets are substantially smaller and less liquid that the
will be suspended.
main stock markets in the United States. Additionally, the
Chilean stock markets can be affected in an important
The risk of stoppage of a thermal plant would also affect
measure by events in other emerging markets. The low
the operations of Enel Distribución Ceará because the
of liquidity in the Chilean market can damage the holder’s
latter contracted 100% of the generation of Fortaleza until
ADS to sell ordinary retired stocks in the Chilean market of
2023, year where the concession Fortaleza finishes. This
the ADS program, in quantity, price, and moment in which
situation might negatively affect the Brazilian business,
they would like to. At the same time, liquidity and the stock
operational results and financial situation, as well as the
market or ADSs can be affected by a series of factors
consolidated financial situation due to the risk of default
that include variations in exchange and interest rates, and
of financial agreements and other contracts of most of
deterioration and volatility of the markets and any liquidity
the Brazilian subsidiaries, and also the reputation of the
change, financial condition, results, and the company’s
company.
100
profitability.
Annual Report Enel Américas 2017
Also, the Chilean stock market can be affected in various
operate its business, the failure of which could adversely
degrees by economic conditions and the other markets in
affect the condition of the business, financial and
Latin America, in emerging markets and other parts of the
operational results.
world. Although the economic conditions in these countries
can significantly differ from the economic conditions in
IT systems are vital worldwide, and electricity sector is not
Chile, the investor’s reactions to changes in the economies
an exception. In the generation business, IT systems can
of any other country may have an adverse effect on the
monitor the operations of power plants, maintain power
market value and value liquidity for Chilean issuers. A raise
generation and network performance, adequately generate
in the perceived risk of the investment in Latin American
customer invoices, achieve operational efficiency, and
countries and other parts of the world may reduce the
meet service goals and standards. Distribution subsidiaries
capital flows to Chile and negatively affect the Chilean
could also be adversely affected as they rely heavily on
economy in general, and the shares or ADS in particular.
IT systems to monitor their networks (currently known
Lawsuits filed against Enel Américas in the other
digitalization of the market), billing processes for millions of
countries of South America or the claims against the
customers, and customer service platforms. In Colombia
Company that are based on foreign legal concepts may
and to a lesser extent, in Argentina, the Company has
in some countries as smart grids because of the greater
not be successful.
installed smart meters that will enable bidirectional,
digitized and interconnected bidirectional communication.
All of the Company’s assets are located outside of the
Temporary or long-lasting operational failures of any of
United States. All the directors and all senior executives
these IT systems, even if intended or not, may have an
are domiciled outside the United States and most of their
important adverse effect in operational results.
assets are also located outside the United States. If any
investor were to file a lawsuit in the United States against
Additionally, cyber attacks may have an adverse effect for
the Company directors, senior executives or experts, it
the reputation of the Company and its relationship with the
may be difficult for them to pursue a legal process within
community. In the last years, global cyber attacks have
the United States against such persons and may be difficult
intensified worldwide threatening the security systems,
for them to enforce, in the courts of the United States or
treasury operations and IT systems. There is a large
Chile, a judgment rendered in the United States based
exposure to cyber attacks whose objective is to damage
on the civil liability provisions of the United States federal
assets through computer networks, cyber espionage in
securities laws. In addition, there are doubts as to whether
the pursuit of strategic information that may be beneficial
a successful action could be waived in Chile with regard to
to third parties, and cyber theft of private and confidential
the liability based solely under the guidance of the United
information,
including
information of the company’s
States federal securities laws.
customers. There has been great exposure to cyber attacks
Interruption or failure of the information technology
affect the access to the service from users and attacks that
systems and communications systems or external
could affect the domain name systems, restraining the use
attacks or breaches of these systems could have an
of certain web pages and useful applications.
in the past, including attacks of service rejection that might
adverse effect on operations and results.
The Company
relies on
information
technology,
cyber attacks may occur and may adversely affect the
communication and process systems (“IT systems”) to
Company in the future.
Enel Américas has suffered cyber attacks in the past. New
101
Risk Factors 15Regulatory Framework of the Electricity
Industry
102
Annual Report Enel Américas 2017 103
Letter from the Chairman Description of the Industry
Sector
Enel Américas and its subsidiaries and jointly controlled companies participate in the generation, transportation, distribution
and sale of electricity in four countries, each of which has a regulatory framework, energy matrixes, participating companies,
and different growth and consumption patterns. The following is a brief summary of the main legal bodies that regulate
the activity, the market structure and the most relevant aspects regarding the agents of each of the countries where the
Company operates.
Argentina
The Argentine electricity sector is governed by, among
other regulations, by Law N°15,336 of 1990 and Law
N°24,065 of 1992. The Wholesale Electricity Market
(MEM) there are four local agent categories (generators,
transmission companies, distributors and large clients) and
foreign agents (generation trading companies and demand
trading companies), companies that are authorized to buy
and sell electricity and its related products.
Originally the generation sector was organized on a
competitive base
(marginalism), with
independent
generators that sold their energy in the MEM spot market
or through private contracts, to clients in the MEM contracts
market, or to the “Administrative Companies in the Wholesale
Electricity Market S.A.”
(CAMMESA) through special
transactions such as contracts under the Resolution S.E.
104
Nº220/2007 and Resolution S.E. Nº724/2008. Nevertheless,
this regimen changed substantially in March 2013, when
the Energy Secretary approved Resolution S.E Nº 95/2013,
which established a remuneration system for the generation
based on average costs, forcing the delivery all the energy
generated to CAMMESA. This new compensation scheme
became valid in February of 2013 and was updated through
the Resolution SE N° 529, N° 482, N° 22 in 2014, 2015,
and 2016 respectively. On February 2, 2017 the Energy
Secretary published the Resolution SEE N°19/2017 replacing
Resolution SEE N° 22/2016 and establishes new guidelines
for the remuneration of existing generation power plants,
focusing on the power availability of the units.
The transmission industry operates in conditions of
monopoly, and is composed by several companies to
which the Federal Government grants concessions.
Annual Report Enel Américas 2017
The distribution sector operates under monopoly
On December 16, 2015, through Decree 134/2015 a
conditions and is served by companies that have also been
national energy emergency was declared until December
granted concessions. Distribution companies have the
31, 2017, where the Ministry of Energy was instructed to
exclusive responsibility that electricity has to be available
elaborate and apply actions to the Generation, Distribution
for final clients within a specific concession area, and does
and Transmission industries with the objective of adapting
not consider if the client has a contract neither with the
the service quality and supply security; and teaching the
distributor nor with a generator.
National Public Administration how to carry out consumer
rationalization programs in the respective public bodies.
Due to the economic slow down that affected the country
in 2002, Law Nº25,561 was enacted with emergency. The
Law disrupted the American dollar parity and pushed the
conversion from Argentine pesos from obligations and
rights assumed by the American currency. This forced
Regulation of Generation
Companies
nominal conversion from dollars to pesos and had a
The regulation of generation companies has suffered
strong impact in the whole Argentinian electricity industry.
important variations since the enactment of Law N°24,065
Additionally, the Government approved several regulatory
until Resolution S.E.E Nº 22/2017. In accordance with the
measures that slowly intervened in the development
aforementioned Law, every generation agents from MEM
of the industry. The Emergency Law has been subject
must be connected with SIN (National Interconnected
to successive extensions and with regards to the last
System) and are obligated to comply with the dispatch
one, approved through Law N°26,896, will be valid until
order to generate and deliver electricity, in order to sell
December 31, 2015. The pesification and devaluation
in the spot market and in the forward market (MAT). The
of the economy forced the renegotiation of all of the
distribution companies, trading companies and large clients
concession contracts. In particular, the distribution sector
subscribed the private supply contracts with generating
and the company participated in the “Energy Distributing
companies, paying the contractual price directly to the
Companies from the South, S.A.” (Edesur), and in 2006 with
generator, and in addition paying a fee to the transmission
the Government when an Act Agreement of Contractual
and distribution company for the use of their systems.
Renegotiation was signed, that subsequently was ratified
through Decree PEN N° 1959/2006, which gradually has
With the objective of stabilizing generation prices facing
allowed the adaptation of tariff revenues as a way to
tariffs for clients, the market defined a seasonal price
guarantee the business sustainability. The implementation
being the price of the energy that distributors pay for
of this agreement was paralyzed since 2008 and until this
their energy purchases traded in the spot market. This
exercise, as explained below.
price is determined every six months by the Energy
No generator, distributor, large user, nor any other company
Secretary, after CAMMESA had carried out their spot price
controlled by any of the latter or under its own control, can
projections in a determined period. In order to adjust to
be the owner or majority shareholder of a transportation
the differences between this price and the real cost of the
company or its controlling companies. At the same time,
original generating, the establishing fund was created. If
transmission companies are forbidden to enter into
the seasonal price is lower than the cost of generating it,
generation activities, distributing, buying, and/or selling
it has to be removed from the fund to compensate the
electricity. The distribution companies are not allowed to
generation; otherwise it contributes to the fund. Since
own generation units.
2002, the Energy Secretary in practice has maintained the
average stationary price, without important variations. This
Regulated clients are supplied by distribution companies
has created an important deficit in the stabilization fund,
with regards to regulated fees, unless they have a
which has been covered by the Argentine state through
minimum demand capacity of 30kW. In this case, they are
subsidies increasingly larger.
considered as “large clients” and can freely negotiate their
prices with generation companies.
The approved resolutions created from the emergency
Law had a significant impact in energy prices. Between the
105
Regulatory Framework of the Electricity Industry measures carried out it mainly highlights the Resolution SE
purpose was to optimize reliability and availability of the
240/2003, which modified the way to fix spot prices when
equipment, for a total amount of US$304 million, in a 7-year
separating the calculation of marginal operating costs. The
term. The agreement also contemplates the payment of
main objective of Resolution SE Nº 240/2003 is to avoid the
contract maintenance obligations (Long Term Service
price indexation linked to the dollar, and despite that the
Agreement -LTSA-) of the combined cycle power plants.
generation study is still based on the real fuels used, the
spot price calculation is based on absolute gas availability
Subsequently, Resolution S.E. N° 95/2013 abandoned
to satisfy demand, even in circumstances in which many
the marginalizing pricing system, thus entering into a
generators generate with alternative fuels, such as diesel,
recognition mechanism of average costs. The Resolution
due to the difficulty of supplying natural gas. The value of
recognizes fixed costs remuneration, variable costs and
water is not considered if its opportunity cost is higher than
additional remuneration. Fixed costs are remunerated
the generation cost using natural gas. The Resolution also
(in ARS$/MW-hrp) in function to technology, scale, and
establishes the spot price limit is Ar$120/MWh, which is
available power. It’s also subject to the achievement of
still valid. The real variable costs of thermal units that burn
goals related to the availability established. In terms of
liquid fuels are paid by CAMMESA through the mechanism
variable costs, the operational costs are remunerated and
denominated Transitory Dispatch Cost Over-run (TDO).
maintenance in function to the energy generated (in ARS$/
MWh), according to the fuel utilized, and its technology (the
Also, based on the dispositions included in the Emergency
generators do not have fuel costs since this is provided
Law, the payment for capacities is reduced from US$ 10
by CAMMESA). Lastly, the additional remunerations are
to AR$10 per MW-hrp (hrp: remunerated capacity hours).
calculated in function of the total energy generated (in
Subsequently, the capacity warranty is slightly raised to
ARS$/MWh), considering the technology and generator
AR$ 12, approximately ⅓ of the value paid before the 2002
scale. Part of these remunerations is accumulated in the
crisis.
fund that will be used to finance the new investments in
infrastructure in the electricity sector.
On December 2004, the Energy Secretary approved the
Adherence Act through the Resolution 1427/2004, for the
The Resolution rules generators, cogenerators and auto
Rehabilitation of Wholesale Electricity Market. The majority
generators, except the power plants that started operations
of the generators signed the Act, including the generation
as of 2005, the nuclear power plants, and the generation
companies owned by Enel Américas (former Enersis).
of hydroelectric national power plants; reserves and
With regards to this Resolution, the Secretary created
centralizes in CAMMESA the commercial management
a fiduciary fund, named FONINVEMEM, where private
and the dispatch of fuel and suspends the celebration of
generators provided part of the energy sold during 2004
bilateral energy contracts between generators and MEM
to 2007 for the construction of two new combined cycles.
agents, and the latter should acquire electricity energy
Also in this new capacity, in 2010 the generation companies
demand with CAMMESA. Resolution SE N° 529/2014
owned by Enel Américas (former Enersis), along with other
mainly performs the value actualization for Resolution SE
companies, participated in the creation of another trust
N°95 and incorporates the non-recurring maintenance
for the construction of another combined cycle, expecting
remunerations for thermal power plants.
the closing of a combined cycle for October 2016. There
was part of the energy credits for to the energy sold in the
Resolution SE N°482 of 2015 updated the remunerations
period 20018 to 2011 allocated to this new project.
of generation companies in force since February 2014.
Pursuant to Resolution 529/2014, thus creating a new
In 2012, the framework of the agreement achieved with the
position, with the objective of financing investments that
Government to enable the development of our subsidiaries
have not been used and excludes hydroelectric power
in Argentina, on October 12, Costanera subscribed an
plant from the variable payments for energy transport
agreement for the implementation of an investment plan
and determined the remunerations for wind energy
for the generation units in Costanera power plant, whose
power plants, photovoltaic solar energy, biomass/ biogas
106
Annual Report Enel Américas 2017 and internal engine combustion. On March 30, 2016, the
CAPACITY REMUNERATIONS FOR THERMAL POWER PLANTS
Secretary of Electric Energy, depending on the Ministry
Minimum Price (since February 2017)
of Energy and Mining, through the Resolution N°22/2016,
Large Cycles
updated all of the remuneration values of Resolution SE
Large TV
N°482/2015, replaced Annexes I, II, III, IV. V, VI, and VII of
the aforementioned Resolution.
Large TG
Engines:
3,050 US$/MW-month
4,350 US$/MW-month
3,550 US$/MW-month
5,700 US$/MW-month
Resolution SEE N°19/2017, was enacted on February
1, 2017, defines a minimum remuneration for capacity
and scale, additionally for the thermal units establishes
the possibility of offering the availability of with a same
Base Price for Committed Remunerations
May 17-Oct 17
Nov 17 onwards:
6,000 US$/MW-month
7,000 US$/MW-month
Additional Price for Committed Remuneration (Maximum)
differential remuneration for every thermal technologies.
The thermal generator may declare every summer the value
May 17-Oct 17
Nov 17 onwards
1,000 US$/MW-month
2,000 US$/MW-month
of the firm capacity to commit for each unit during a 3-year
period, being able to discriminate between summer and
winter periods (adjusts can be made in the same period).
As the exception and for the year 2017, the declaration
of Commitment of Guaranteed Availability is habilitated,
along with the information required by the Seasonal Winter
Program, in force from May 1 to October 31, 2017.
The maximum price given the offers that should be
awarded by CAMMESA, with regards to the needs defined
for the system to face critical situations.
CAPACITY REMUNERATIONS FOR HYDROELECTRIC POWER
PLANTS
Minimum Price (since February 2017)
The thermal generator will sign a Commitment of
Chocón
Guaranteed Availability contract with CAMMESA, but
Arroyito
will give to the corresponding demand as determined by
Secretary of Electric Energy. The remunerations that the
unit will receive with the capacity commitment will be
proportional to its performance, and the minimum value
will be calculated in relation to the minimum price.
Additional Price
May 17-Oct 17
Nov 17 onwards:
2,000 US$/MW-month
3,000 US$/MW-month
500 US$/MW-month
1,000 US$/MW-month
With respect to the hydroelectric power plants, a new
will be subject to the disposal of large events insurance
scheme to evaluate capacity was defined, based on the
(turbines, etc.) and the progressive modernization of
Since November 2017, 50% of the additional remuneration
real capacity available (implying a greater value of capacity
control systems.
with respect to the previous regulation). Likewise, they
introduce a base capacity value, and another additional
REMUNERATION BY ENERGY
discriminated from May to October 2017, and starting in
November 2017.
The Resolution establishes the following remuneration
values, which are defined in dollars (conversion considers
the exchange rate published by the Central Bank of the
Republic of Argentina of the last business day) and the
maturity dates are established by CAMMESA’s Procedures:
Energy Generated
Cycles and TV
Gas
Liquid
Engines
Gas
Liquid
Hydroelectric
5 US$/MWh
8 US$/MWh
7 US$/MWh
10 US$/MWh
3.5 US$/MWh
Energy Operated (associated to Rotant Capacity)
Thermal
Hydro
2.0 US$/MWh
1.4 US$/MWh
Energy values are defined at the Node.
107
Regulatory Framework of the Electricity Industry
For the cases in which generators have requested a loan for
partially and temporarily increased, the Integral Tariff
maintenance, US$1/ MWh will be discounted for energy
Review (RTI) were distribution companies pending under
generated by the power plant until paying the balance for
national jurisdiction. This tariff revision process wasn’t
financing.
accomplished, and the term for contracts renegotiation
was postponed several times through laws enacted by
Later the SEE established that the conversion to pesos
Congress, thus postponed the duration of the Economic
would be carried out the day previous to the maturity date
Emergency.
since November 2017.
The new National Administration made a change of
The Resolution SEE N° 1085/17 modifies since December
paradigm on December 16, 2015, when the National
1, 2017, the agents’ payment method for the transportation
Executive Power issued the Decree N° 134/2015 declaring
system (the remuneration for the transport agent doesn’t
the emergency for the National Electricity Sector until
change because it was determined in its respective RTI). It
December 31, 2017. Also mandated the recently created
established the following:
Ministry of Energy and Mining to develop, release and
> The costs associated to transportation remuneration will
energy generation, transport and distribution sectors. The
be distributed proportionately in relation to demand.
purpose of these measures was to adjust the quality and
> Generation Agents will pay direct connection costs only.
safety of electricity supply and ensure the energy utilities
> Mandates CAMMESA to propose the modifications
services in suitable technical and economic conditions.
implement the national program of activities needed for the
required for the proceedings within 90 days (regulation
of the MEM).
Regulation of distribution
companies
In January 28, 2016, after the seasonal price changes,
the Emergency Resolution No. 7/2016 was issued by the
Ministry of Energy and Mining. The resolution introduced
by the ENRE to adjust Edenor and Edesur fees through
a transitory tariff until the RTI is applied, expected
for December 31, 2016. Also, Resolution No. 7/2016
Companies
that obtain concessions carry out
the
suspended the PUREE and required the application of a
distribution activity. Distribution companies must supply
subsidy rate for the more vulnerable clients.
all of the electricity demands in their concession areas
exclusive to prices (tariffs) and conditions established
In January 29, 2016, the ENRE issued Resolution No.
in the Regulation. The concession agreements include
1/2016 with a new transitory tariff valid from February 1,
penalties for the failure to provide electricity service. The
2016. Its application is included in Resolution MEM No.
concessions were given for distribution sales and retail
7/2016, which changed the supply procedures and defined
sales. The concession periods are divided in “management
a monthly Billing.
periods” that allow concessions abandon the concession
every certain amount of time.
Also, the ENRE issued Resolution No 2/2016, which ended
the FOCEDE and established a new procedure for funds
Since 2011, there are two electricity distribution areas
from Resolution ENRE 347/12, in substitution for Edesur
subject to federal concessions. These concessionaires
and Edenor confidence for a commercial account.
are Edesur and Edenor, both located in the city of Buenos
Aires and Gran Buenos Aires. Until 2011 Edelap was also
On April 5, 2016, Resolutions N° 54 and 55 were enacted
under federal jurisdiction.
by the National Electricity Regulating Entity. The first
Most of the distribution companies renegotiated their
for the hiring of a Consultant for the RTI of EDESUR and
contracts during 2005 and 2006, although fees were
EDENOR, and the second approves the timetable and
approves the Bases and Conditions for Private Companies,
issues guidelines for the same, indicating that ENRE
defines the Parameters of Quality and the Rate.
108
Annual Report Enel Américas 2017 Continuing with the tariff renegotiation process, on August
as timely and convenient to instruct ENRE to limit the
8 ENRE issued Resolution 463/16, which provide details
VAD increases that emerged as an RTI process results
of the parameters of the technical service and quality, and
to be applied starting February 1, 2017, to a maximum of
the cost and values of unsupplied energy required for the
42% with respect to the valid VAD at that date, having to
modification of the RTI. Similarly, on August 29 through
complete the resulting value application of the new VAD, in
Resolution ENRE 492/16, the Quality of Commercial
two stages: the first in November 2017, and the second in
Service and Technical Product Parameters were defined.
February 2018.
This resolution contains economic signals towards the
fulfillment of deadlines and times of supply replenishment
Also, it was decided that ENRE must recognize Edenor
reductions.
S.A. and Edesur S.A. the VAD difference that is produced
by the application of gradual fee increases recognized by
On the other hand, on August 30, the regulation entity
RTI, in 48 (forty-eight) installments starting from February
proceeded to inform the value of the Rate of Profitability.
1°, 2018, which increases the resulting VAD value as of that
This was established on Resolution ENRE 494/16 at
date.
12.46% before taxes and 8.1% after taxes.
The regulation also sets revenues updates mechanism for
On September 1, Edesur proceeded to the final presentation
the distribution companies as a result of price variations in
of the investment plan requested by Resolution ENRE
the economy and all of the other issued related with the
55/16 and then receiving from the Secretary of Electric
quality of the service delivered and supply regulation.
Energy the note NO-2016-01193698-APN-EDESUR RTI
which established that credit and debit from the disregard
Once this regulatory framework is established with
of the Agreement Act would be treated separately from
regards to the distribution tariffs regime including the
the income required from the RTI and proceeded to
instructions enacted by Ministry of Energy and Mining, and
complete on September 6, the related reports with
the resolutions contained in Resolution SEE N° 20/2017 on
Fundamentals and the criteria of the proposal: exploitation
seasonal prices valid from the corresponding invoice of
costs, revenues requires and calculation of fees, tariff
February 1, 2017, it was declared that the transition tariff
structure and wholesale transfer costs, and the updating
phase of Edesur was met, and the Agreement Act that the
mechanisms of the Company’s distribution costs, results
company adheres as established in its concession contract.
and economic financial model. This method concluded
with the delivery of formal final reports required for the
In accordance with the request made by Article N° 29
aforementioned resolution.
of Resolution ENRE N° 64/17 (Physical monitoring of the
On September 28, through Resolution ENRE 0522/2016,
Investments Plan duly informed for the RTI (in physical
works plan) on March 20 Edesur sent a note ratifying the
the regulating organism decided to call for a Public Hearing
terms).
with the objective of acknowledging and listening to
opinions with regards to Tariff Proposals presented by
In conformity with the Law of Administrative Procedures,
the distributing companies for the next five-year period;
on March 20, 2017 Edesur S.A. formally filed an appeal to
this is part of the Integral Tariff Revision Process (RTI)
the ENRE questioning resolution ENRE N° 64/17 which
and with previous character to define the tariffs to apply
basically focuses on the treatment of easements, some
by the referred Subsidiaries in said five year period.
optimization criteria in the definition of the capital base,
On Wednesday February 1, 2017, the ENRE published
the treatment for the recognition of certain taxes and
Resolution N° 0064 which closed the RTI process and as a
objections to the quality regime. We highlight the fact that
result, establishes the annual remuneration recognized by
the observations and the explanatory orders presented,
Edesur S.A. amounting to ARS$14,539,836,941.
either accepted or rejected by the regulator, will not
significantly affect the result of the RTI.
With regards to the application of new structures and tariff
charges, the Ministry of Energy and Mining considered
109
Regulatory Framework of the Electricity Industry On July 26, 2017 ENRE issued Resolution N° 329/2017,
In an unprecedented fact performed on October 27, 2017,
defining the procedure for the billing of deferred revenue
the ENRE, complying with resolution N° 403 of October 26,
established by Resolution ENRE N° 64/2017 (Article 4°)
2017, the Ministry of Energy and Mining, through resolutions
states that “…receivables corresponding to each tariff
526 and 527 convened a Public Hearing for November 17,
category, will be the sum of the monthly accrued revenues,
2017 in the Palace of Waters. The topics to be discussed are
recognized by tariff category …”; establishing the certainty
in the first place the new reference prices for capacity and
of payment by recalculating each year the revenues not
energy, and the reference prices for capacity and stabilized
recovered deducting the payments from initial credits,
for energy reference for distribution companies at node,
and recalculating the remaining installments to cover the
equivalent to each of them and for the seasonal period
balance; and the mechanism to update the latter “…These
of summer 2017-2018; the energy savings stimulus plan;
charges will be adjusted, being components of the CPD,
social tariff and the distribution methodology between the
according to the “trigger clause” and in the “Adjustment
demand of MEM and the cost of remuneration of energy
Mechanism” …”.
transport in extra high tension and between the demand
of a region and the corresponding demand for transport
On May 17, 2017 Law 27,351 of Electro dependents
for mainline distribution. And in the second place, informs
was enacted, establishing the gratuity and continuity of
the impact that would have the measures to be carried out
electricity supply, together with the priority of service
by the Ministry of Energy and Mining in the bills of users
to those clients that for health reasons require constant
of distribution companies, as a result of the Public Hearing
electricity supply and with adequate tension levels in order
that this Ministry has convened for Resolution MEyM
to feed the equipment prescribed by a licensed physician
403/2017. This is in relation to the Wholesale Electricity
and needed to avoid health or life risks. In this context,
Market, the withdrawal of subsidies for energy transport
on July 26, 2017 through Resolution ENRE 292, this entity
and the criteria of distribution among users of transport of
established the gratuity of service and the connection cost
the transporters remuneration that this entity solved with
for this users category of the companies Edenor y Edesur.
the Integral Tariff Review of Transport of Electrical Energy.
In this line, On September 25, the Ministry of Health
through Resolution 1538-E created the “Registry of Electro
As a result of this, on December 1 through Resolution
dependents due to Health Reasons”. To this date, are still
602, ENRE approved the new values of Distribution Own
pending the rules for operational issues to ensure the
Cost of Edesur, through the application of the mechanisms
continuity of supply, for the compensation of distribution
considered in the RTI. Concurrently, issued the tariff
companies (Law 27,351 Article 11.- The Executive Power
scheme that reflects seasonal prices (generation and
will appoint the authority to enact this law and will assign
transport) included in the resolution of the Secretary of
the budget allocations needed to fulfill their objectives) and
Electric Energy 1091 of 2017. It also approved the new
the limits of responsibility of each of the parties involved.
schemes for subsidy for Social Tariff and the bonus system
for consumption savings for residential users.
On November 1, 2017, ENRE enacted Resolution 525
partially establishing
the Reconsideration Resource
Finally, the return to normal conditions in relation to the
interposed by EDESUR against Resolution ENRE 64/2017,
economic emergency situations and energy emergency
accepting its measures regarding easements treatments
was materialized through the decision of the Argentinean
and requesting the company that within 60 days should
National Government of not to extend the effect of the
submit an annual plan for the regularization of easements to
Electric Emergency Law (in effect until December 31,
be developed in the period 2017/2021. Also requested the
2017) and the Economic Emergency Law (in effect until
recognition of expenses of CAMMESA, rates and others
January 6, 2018).
that should be available in future adjustments and minor
modifications to the quality regime and other recognitions.
110
Annual Report Enel Américas 2017 Regulation of Transmission
Transmission was designed on the basis of general
conception and the principles established by Law 24,065,
adapting the activities to the general criteria contained
in the concession given by Transener S.A., in Decree
2,473/92. For technological reasons the transmission
business is related to economies of scale that do not allow
competition, therefore it is a monopoly and is subject to
considerable regulation.
Similarly as the distribution industry, during 2016 ENRE
carried out Integral Tariff Review for national transport
companies (Transener S.A., Distrocuyo S.A., Transco S.A.,
the Province Energy Entity of Neuquén, Transba S.A.,
Transnea S.A., Transnoa S.A., Transpa S.A.) for the period
2017 and December 31, 2021, which came into force
during 2017.
Environmental Regulation
compliance of these requirements forces the government
to establish penalties, such as suspension of operations
that, in the case of public service, can result in the
cancellation of concessions.
Law Nº26,190, enacted in 2007, defined the use of
renewable sources for the generation of electricity as
national interest and set as a goal 8% of the market
participation for renewable energy in 10-year term.
On October 21, 2015, the Official Bulletin published the
new Law 27,191, of Renewable Energy in Argentina,
modifying
the Law N°26,190. The new
regulation
postpones to December 31, 2017, with the objective of
reaching 8% participation in the national demand with the
generation of renewable sources and establishing as a
second stage objective to reach 20% of participation by
the year 2025, and setting mid goals of 12%, 16%, and
18% for the end of the years 2019, 2021, and 2023. The
sanctioned Law creates a Fiduciary Fund (FODER) that
could finance projects, give tax benefits to the renewable
energy projects, and establish the non application of
The electricity installations are subject to environmental
specific tributes, national royalties, regional and municipal
laws and regulations, federal and local, including Law
until December 31, 2025. The clients categorized as Large
Nº24,051, or Dangerous Waste Law, and its annexed
Users (>300 Kw) should individually fulfill the participation
regulations.
of the renewables, establishing that the price of these
contracts cannot be superior to 113 US$/ MWh, and setting
In the electricity sector, certain obligations to inform
penalties to those who do not fulfill these objectives. The
and monitor impose on emission standards. The non-
law regulations are still pending.
111
Regulatory Framework of the Electricity Industry Brazil
Industry Structure
each of the generator providers. The price at which spot
market transactions are settled is called the Settlement
Price of Differences (PLD), which takes into account the
risk aversion curve of the agents.
Transmission works under monopoly conditions. The
Brazilian government sets tariffs for transmission for the
The Brazilian electricity industry is organized in a large
companies. The charge for transmission is fixed and the
interconnected system, the SIN (National Interconnected
transmission revenue does not depend on the amount of
System), which comprises most of the regions of Brazil,
electricity transmitted.
and several other smaller isolated systems. The generation,
transmission, distribution and commercialization are legally
Distribution is a public service that also works under
separated activities in Brazil.
monopoly conditions and is provided by companies that in
turn have received concessions. Distribution companies in
The industry is regulated by the Federal Government
the Brazilian system are not entitled to: (i) develop activities
through the Ministry of Mines and Energy (MME) and also
related to the generation or transmission of electricity; (ii)
by the National Electric Energy Agency (ANEEL).
sell electricity to unregulated customers, except to those
within its concession area and under the same conditions
Pursuant to Law No. 10,848 of 2004, the wholesale
and tariffs applicable to its captive clients of the Regulated
electricity market as a tool for spot price formation is
Market; (iii) maintain, directly or indirectly, equity interest
residual. On the other hand, the wholesale price is based
in any other company, corporation or partnership; or (iv)
on the average bid prices, with independent bidding
develop activities that are not related to their respective
processes for existing energy and “new” energy. The latter
concessions, except those permitted by law or in the
include long-term contracts in which the new generation
relevant concession agreement. Generation companies
projects must cover the growth of demand foreseen by
are not authorized to have equity interest in distribution
the distributors. The “old” energy tenders consider shorter
companies in surplus of 10 percent.
contracting periods and seek to meet the contracting
needs of the distributors that arise from the expiration
The unregulated market includes the sale of electricity
of previous contracts. Each bidding process is centrally
between
generation
concessionaires,
independent
coordinated, the authority defines maximum prices and,
producers, self-producers, electricity traders, electricity
as a result, contracts are signed where all distributors
importers, unregulated consumers and special customers.
participating in the process buy at fair appointment from
It also
includes contracts between generators and
112
Annual Report Enel Américas 2017 distributors existing under the old regulatory framework,
increase the security of the power supply in the National
until its expiration. New contracts must be adjusted to the
Interconnected System. Since 2015, the auction has been
new regulatory framework. According to the specifications
created for hydroelectric plants that have not extended
established in Law 9,427/96, unregulated consumers in
their concession contracts, according to Law 12,783/2013.
Brazil are those that: (i) demand a capacity of at least 3,000
This auction allows a part of the generated energy to
kW and choose to contract the supply of energy directly
be sold in quotas and the other part in the free market
with generators or marketers; or (ii) demand a capacity in
(the percentage is defined in each auction). The winner
the range of 500 to 3,000 kW and choose to contract the
is the entrepreneur who pays the biggest bonus for the
power supply directly with generators or traders of energy.
concession.
The Brazilian system is coordinated by the Brazilian
The new energy tenders include long-term contracts (20-
Electrical System Operator (ONS) and is divided into four
25 years for thermal plants, 30 years for hydro, 20 years
sub-systems: Southeast/Center-West, South, Northeast
for solar and wind), in which the new generation projects
and North. In addition to the Brazilian system there are also
must cover the growth of demand forecasted by the
some isolated systems; in other words, those systems
distributors. The “old” energy tenders consider shorter
that are not part of the Brazilian system and are generally
contracting periods and seek to meet the contracting
located in the northern and northeastern regions of Brazil,
needs of the distributors that arise from the expiration of
and have only coal or oil fired thermal power plants as their
previous contracts, so that energy can be sold at lower
unique source of energy.
prices. Each tender process is centrally coordinated,
Regulation in Generation
Companies
the authority defines maximum prices and as a result,
contracts are signed where all the distributors participating
in the process buy fairly appointed from each generation
company.
The Generation Agents, who can be public generation
The Decree 5,163/2004 establishes that selling agents
concessionaires, IPPs or auto producers, as well as
should ensure 100% of physical coverage for their energy
Marketing Agents, can sell electricity in two contracting
and power contracts. This coverage can be constituted by
environments. First, the Regulated Contracting Environment
physical guarantees of their own generating plants or of
(ACR), where distribution companies operate, in which the
any other plant, the latter through a contract of purchase
purchase of energy must be done within the framework of
of energy or power. Among other aspects, Resolution
the bidding process coordinated by ANEEL; and the other
109/2004 of ANEEL specifies that when these limits are
denominated as the Free Contracting Environment (ACL)
not met, agents are subject to financial penalties.
in which energy purchases are made directly between
suppliers and their customers. Regardless of the ACR or
In 2016, the economic context of the country has led to
ACL, the sales contracts of the generators are registered in
a situation of surplus energy, so some measures were
the Câmara de Comercialização de Energia Elétrica (CCEE)
established to reduce surpluses of distribution companies,
and form part of the basis for quantifying and determining
such as the possibility of bilateral agreements between
adjustments for differences in the short-term market.
generation and distribution companies for temporary,
In relation to market regulation, 100% of the energy
not effective and still the distributors have surpluses over
partial or termination of the PPA. But these measures were
demanded by the distributors must be satisfied through
the review for consumers.
contracts in the current regulated environment. As such,
the regulated purchase price for the formation of tariffs for
Law 13,360 was enacted in 2016 establishing several
final users is based on the average prices of tender offers,
changes to the sector, among which are:
with independent bidding processes for ‘new energy’,
‘existing energy’ and ‘reserve energy’. The “new” and
Permits for distribution companies that sell the surplus
“old” energy auctions are made to meet the demand of
contracts to free consumers.
the distributors market. Reserve Auctions are made to
113
Regulatory Framework of the Electricity Industry Renewal of hydroelectric concessions <= cost of 50MV.
per MWh and the A-2 offered 423 MW of energy at an
average price of BRL$174.52 per MWh.
Compensation for hydroelectric generators due to thermal
generation without the order of merit.
Changes in the periods of the auctions (terms).
Regulation in Distribution
Companies
In search of a solution to the impacts caused by droughts,
In the regulated market, distribution companies buy
in December 2015 ANEEL approved the conditions for a
electricity through biddings that are regulated by ANEEL
“renegotiation” of hydrological risk with the generation agents
and organized by CCEE. Distributors must purchase
participating in the Energy Reassignment Mechanism (MRE).
electricity in public biddings. The Government also has the
To adhere to the “renegotiation”, it was necessary to waive
right to call for special biddings for renewable electricity
the lawsuits. There was significant adhesion by regulated
(biomass, mini hydro, solar and wind power plants). ANEEL
market centers, however, there was no adhesion of power
and CCEE hold annual bids. The recruitment system is
plants in the free market, because the conditions were not
multilateral, with generating companies that sign contracts
interesting. Currently, there is still a part of generators with
with all the distributors that convene the biddings.
provisional and/or precautionary measures that limit their risk
and transfer part of the costs to consumers.
The Concessions Law establishes three types of tariff
reviews or adjustments to final consumers: The Tariff
ANEEL annually validates, by resolution, the minimum
Repositioning
Index
(IRT), which
implies an annual
and maximum values of the PLD, so that the maximum
adjustment of the rate for inflation; The Ordinary Tariff Review
and minimum PLD are set at BRL$533.82/MWh and
(RTO) to be carried out every four or five years according
BRL$33.68/MWh, respectively for 2017. The calculation
to each concession contract, and the Extraordinary Tariff
of the maximum PLD considers the variable costs of
Review (RTE), which are carried out when a relevant event
operation of the thermoelectric plants. For the minimum
occurs in the sector that significantly affects the value of
PLD is considered the costs of operation and maintenance
the tariff. In this way, the Law guarantees an economic
of hydroelectric power plants.
and financial balance for a company in case that there is
Regarding regulated power biddings, in order to reconstitute
that the cost of components for Parcel A, such as energy
the energy supply, in 2016 three biddings were carried out
purchases or taxes, increase significantly within the period
with the energy assigned:
of two annual tariff adjustments, the concessionaire may
a substantial change in its operating costs. In the event
submit a formal request to ANEEL for these costs to be
1 bidding A-1: 21 MW-mean, with two years of energy
Transferred to the final clients.
supply.
> >1 bidding Energy Reserve: 9.,4 MW-mean, assigned to
Every tariff revisions and repositioning are approved by
small hydro at an average price of BRL$227.02 per MWh.
ANEEL.
> 1 bidding A-5: 201,8 MW-mean, assigned to Hydro
(17%), mini hydro (41%), Biomass (40%) and Gas (2%))
In tariff revisions (RTO and RTE), ANEEL reviews the
at an average price of BRL$ 198.59/ MWh.
rates in response to changes in energy costs and market
conditions. When adjusting distribution rates, ANEEL
In 2017 four tenders were offered: (i) A-4, on 12/18/2017,
divides the Annual Reference Value, that is, the costs of the
the offer was 2,202 MW of energy at an average price of
distribution companies in: (i) costs unmanageable by the
BRL$144.51 per MWh (3% hydro, 4% thermal, 16% wind
distributor, also called “Parcel A”, and (ii) manageable costs
and 77% solar); (ii) A-6, on 12/20/2017, the offer was 27.366
by the distributor or “Parcel B”, the latter corresponding to
MW of energy at an average price of BRL$189.45 per MWh
what we know as Value Added Distribution (VAD).
(3% hydro, 72% thermal, 25% wind); (iii) A-1 and A-2, on
12/22/2017, the A-1 tender offered 288 MW of average
The ordinary tariff review takes into account the entire tariff
energy commercialized at an average price of BRL$177.46
setting structure of the company, including the costs of
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Annual Report Enel Américas 2017
providing services, the costs of buying energy as well as the
Due to the mismatches between the costs recognized in
return for the investor. Under its concession contracts, Enel
tariff and the real costs outside the management of the
Distribución Ceará and Enel Distribución Río are subject to
distributor, and intensified by the implicit costs of the
tariff revisions every four and five years, respectively. The
drought, ANEEL, in January 2015, began to implement a
basis of the assets to calculate the return allowed to the
system (known as Tariff Flags) of additional monthly charge
investor is the replacement market value, depreciated over
on the consumer rate provided that the marginal cost of
its useful life from an accounting standpoint, and the rate
the system reaches levels above the regulatory standard.
of return on the distribution asset is based on the Average
The objective of the regulator is to give the consumer an
Capital Cost Weighted, or WACC for a model company. The
economic signal of the cost of the generation already in the
WACC is reviewed in each rate cycle. The value of the WACC
subsequent month, moving forward an amount (of right)
for distribution is currently in effect at 12.26% real pre-tax
that the Distributor would only collect it in next tariff event.
rate.
The regulatory mechanisms ensure the creation of
of flags: green, yellow, red level 1 and red level 2.
This mechanism - described below - consists of four levels
regulatory assets or liabilities, whose tariff rebuilding
occurs in subsequent tariff adjustments (March 15 for Enel
Values Applied for Tariff in 2017
Distribución Río and April 22 for Enel Distribución Ceará).
This mechanism has existed since 2001, and is called
Since November 2017, the value of the banners is:
the Parcel A Securities Compensation Account (CVA). Its
objective is to keep constant operating margins for the
> Green tariff (Favorable conditions for energy generation):
concessionaire in order not to allow tariff gains/losses due
Without tariff surcharge.
to the variation of Parcel A costs.
> Yellow tariff (Less favorable generation conditions):
BRL$1.00 per 100 (kWh)
The Securities Compensation Account (“CVA” for the
> Red Tariff
-
level 1
(More expensive generation
Brazilian abbreviation) helps to maintain market stability
conditions): BRL$3.00 per 100 (kWh)
and allows the creation of deferred costs, which is
> Red Tariff
-
level 2
(More expensive generation
compensated by tariff adjustments based on the necessary
conditions): BRL$5.00 per100 (kWh)
rates to compensate for the deficits from the previous year.
In summary, with this mechanism the cost of generation
In December 2014 the distributors in Brazil, including
that is currently transferred to the customer only once a
the Enel Group, signed an addendum to the concession
year (when the annual rate adjustment is made) will have
contract that allows these regulatory assets (CVA’s and
a monthly variation, therefore the customer will be able to
others) to be part of the indemnifying assets at the end
have a better management of the electricity consumption.
of the concession, in the event that it is not be possible
In other words, consumers will be aware of a lower tariff
to compensate through tariffs at that time. Thus, in
readjustment, since they are already paying a higher value
accordance with the IFRS rules, the accounting of these
during the month.
regulatory assets/ liabilities is allowed.
To cover the energy surcharge caused by the drought
in 2014, the Government has created the ACR account
through bank loans to be paid within two years for the
tariff. In 2014 the distributors used an approximate amount
of BRL$ 18 billion of the ACR account, however, it was not
enough to cover the entire deficit. A new loan to the ACR
account was approved in March 2015 to cover the deficits
of November and December of 2014. An extension of the
repayment term for all loans was approved, which should
now be paid in 54 months starting from November 2015.
Regulation in Transmission
Any electricity market agent that produces or consumes
energy is authorized to use the Basic Network. Free market
consumers also have this right, subject to compliance with
certain technical and legal requirements. Free access is
guaranteed by law and supervised by ANEEL.
The operation and administration of the Basic Network
is the responsibility of the ONS, which also has the
responsibility of managing the dispatch of energy from
115
Regulatory Framework of the Electricity Industry the plants in optimum conditions, involving the use of the
S.A. For low-tension consumers, particularly residential,
interconnected system, reservoirs and thermal plants.
the average adjustment to be applied will be -6.24%.
Regarding medium to high-tension clients, the average
As of April 5, 2011, it was published in the Official
adjustment to be applied will be -7.12%.
Gazette, the Ministerial Docks 210/2011 and 211/2011,
which equate the two interconnection lines of the Energy
Interconnection Company, S.A. to concessions of public
service, with payment according to a regulated toll. The
Annual Permitted Remuneration (hereinafter “RAP”) is
adjusted annually, in June, by the National Broad Consumer
Price Index (“IPCA”) with tariff revisions every four years. It
Tariff Readjustment for Enel
Distribución Ceará S.A. (former
Coelce)
was defined a Gross Remuneration Base of BRL$ $1,760
On April 20, 2017, ANEEL standardized the tariff adjustment
million (US $885 million) and a Net Base of BRL$ 1,160
of Enel Distribución Ceará through Resolution N° 2,223.
million (US$ 585 million). In 2012 ANEEL authorized the
This annual tariff adjustment of Enel Distribución Ceará
implementation of reinforcements in the transmission
produced an average effect for customers of 0.15%, being
facilities, recognizing an additional investment of BRL$47
1.44% in average for High Tension consumers and -0.39%
million (US$ 23 million), in the Remuneration Base. The
for Low Tension consumers.
applicable remuneration rate was defined in agreement
with the current regulation at 7.24% (real after tax). The
The transmission costs had a huge impact in this adjustment
authorization period is until June 2020, for Line 1, and until
(the variation was 140.28% compared to the reference
July 2022, for Line 2, with a welfare compensation for
values of the previous tariff process), where the average
unamortized investments.
effect was 3.23%. This is explained by the estimation of
2017 Adjustments
Tariff Readjustment for Enel
Distribución Río S.A. (former
Ampla)
Enel Distribución Río S.A. singed on March 14, 2017, the
New Concession Contract (Sixth modification) resulting
from the public hearings N° 095 y N° 058. In these
hearings the discussion was focused on the regulation
and the application of the tariffs procedures for distribution
companies that register by their own choice for the
application of the modifications of the concession contract,
pursuant to Decree Nº 2194/2016.
These new rules were applied for the definition of this
adjustment of 2017, which include, among other changes,
the use of the IPCA index replacing the general market
price index (“IGP-M”), part of the unrecoverable revenues
of Parcel B were transferred to Parcel A and new indexed of
regulatory losses were applied. As a result, ANEEL approved
an average adjustment of -6.51% for Enel Distribución Río
116
higher costs, which were included from July 2017.
Readjustment for Enel Cien
Resolution nº 2258 established that annual revenues
allowed (RAP) for concessionaires of public service of
electricity transmission, would be related to the availability
of transmission facilities under their responsibility.
The values of Cien are: Garabi I (RAP: BRL$167,874,943.85
and PA adjusted: - BRL$9,581,554.75) and Garabi II (RAP:
BRL$174,388,271.81 and PA adjusted: - BRL$9,953,306.53).
for
Readjustment
Distribución Goiás
Celg)
Enel
(former
On October 17, 2017, ANEEL standardized the tariff
adjustment of Enel Distribución Goiás through Resolution
N° 2,317. This annual tariff adjustment Enel Distribución
Goiás produced an average effect for customers of 14.65%,
in average was 12.03% for High Tension customers and
15.89% for Low Tension customers.
Annual Report Enel Américas 2017 Colombia
Structure of the Industry
The CREG is empowered to issue regulations governing
technical and commercial operations as well as tariffs for
regulated activities. The main functions of CREG are to
establish the conditions for the progressive liberalization
of the electricity sector towards an open and competitive
market, to approve charges for networks and transmission
and distribution costs for the supply of regulated
Law 142 of the Home Public Services, and the 143,
customers, to establish the methodology to calculate and
Electricity Law, structurally reformed the Colombian
set maximum tariffs for the supply of the regulated market,
electricity sector both enacted in 1994. According to Law
establish standards for the planning and coordination of the
143 of 1994, the different economic agents, private, public
operations of the System, establish technical requirements
or mixed, can participate in the activities of the sector, and
for quality, reliability and security of supply, and protect the
have the liberty to develop their functions in the context of
rights of customers.
free competition in the market. To operate or start projects,
it must be obtained, from the competent authorities, the
The Wholesale Energy Market in Colombia is based on
authorization for the different environmental, sanitary
a competitive market model and operates under open
and water rights, and those where municipal sanction is
access principles. The operation and administration of the
required.
MEM is centralized in a Market Operator made up of the
Administrator of the Trade Exchange System (ASIC) and the
The Ministry of Mines and Energy (MME) defines the
National Dispatch Center (CND).
Government’s policies for the energy sector. Other
government entities that play an important role in the
The generation sector is organized on a competitive basis.
electricity industry include: Superintendence of Home
The electricity transactions in the WEM are carried out
Public Services (SSPD), entity that monitors and audits
under the modalities of the spot market of energy (Short
all the public service companies; the Energy and Gas
term or daily market); Bilateral Contracts (Long Term
Regulation Commission (CREG), which regulates electricity,
Market) and Reliability Charge. Generation companies must
natural gas, liquefied petroleum gas (LPG), and liquid
participate in the central office in a mandatory manner,
fuels; the Energy Mining Planning Unit (UPME), which is
with all of their generation plants or units connected to
responsible for the planning and expansion of the network
the Colombian system whose capacities are equal to 20
and the Superintendence of Industry and Commerce (SIC)
MW or higher (plants with capacities between 10 and 20
which is the national authority for competition protection
issues.
117
Regulatory Framework of the Electricity Industry MW can optionally participate). The generation companies
In the short-term energy market, the CND receives, each
that participate in the central office must declare the
day, the offers of prices and the declaration of commercial
commercial availability of their generation resources and
availability for each hour of the following day, of all the
offer the price at which they wish to sell it. This energy is
generators participating in the wholesale market. Based on
centrally dispatched by the National Dispatch Center (CND)
this information, the CND performs an economic dispatch
with economic optimization criteria and respecting the
through an optimized procedure for the next 24-hour period
electrical and operational restrictions of the system.
of the following day, taking into account the electrical and
operation restrictions of the system, as well as other
Commercialization consists of the intermediation between
conditions necessary to satisfy the expected energy
the actors that provide electricity generation, transmission
demand for the next day in safe, reliable and economic
and distribution services, and the users of these services.
manner from the cost point of view. Unlike the rest of the
The commercialization can be carried out along with or
countries where the office is centralized based on variable
without other activities of the electric sector.
costs of production, in Colombia, the office is based on
prices offered by agents.
Transmission operates under monopoly conditions with a
guaranteed annual fixed income, which is determined by
The energy market is a market of adjustments, where the
the new replacement value of networks and equipment
excess energy is sold or bought against the real energy
and by the value resulting from the bidding processes
demand of generators and retailers. The power exchange
that add new projects for the expansion of the National
the determined spot price is established by the ASIC
Transmission System (STN). This value is distributed among
after the day of operation is established by means of an
all the retailers in the market in proportion to their energy
optimized procedure for the 24-hour period called the ideal
demands. The National Interconnected System (SIN)
dispatch, which implies an infinite transmission capacity in
supplies 98% of the national demand. Non-interconnected
the network and takes into account the initial conditions
systems serve isolated areas of the country.
of operation, thus establishing which generators had to be
Distribution is defined as the operation of local distribution
all generators that are dispatched for merit of price is the
networks and regional transmission. Any customer can
price of the most expensive generator dispatched every
dispatched to satisfy the actual demand. The price paid to
have access to a distribution network in which he pays
hour under the ideal dispatch.
a connection fee. Distribution companies, or network
operators, are responsible for the planning, investment,
The cost differences between the ‘planned dispatch’ and
operation and maintenance of electricity grids with
the ‘optimal dispatch’ are called ‘restriction costs’. The cost
voltages below 220 KV.
of each restriction is allocated to start with to the agent
responsible for the restriction and when it is not possible
Regulation in Generation
Companies
to identify an agent it is distributed proportionally to all
Colombian system traders according to their demanded
energy, and these costs are transferred to the final
The Colombian State can participate in the execution
customers.
and exploitation of the generation projects as well as the
Generators connected to the Colombian system can also
private sector. The Law 142 of 1994, established that the
participate in the “Reliability payment”, which is a mechanism
legal regime of public services and the Law 143 of 1994
that aims to encourage investment in the generating park to
focused, particularly, in the service of electric power
ensure that the country’s demand is met in the long term.
service, determined the types of entities authorized to
The Charge consists of the assignment of Firm Energy
provide residential public service, in this sense it was
Obligations (OEF) through a descending auction for new
created the “Public Service Company” as the fundamental
agents interested in developing generation projects, who
for this provision.
must guarantee the System that amount of energy for a
118
Annual Report Enel Américas 2017 given period. The allocation for existing generators is made
electricity market. In particular, emphasis was made in: i.
annually and for new projects for up to 20 years. The OEF
the revision of key issues of the Wholesale Energy (MEM
is a commitment on the part of the generating company,
is its Spanish acronym), mainly in the modification of the
backed by its physical resources, which provide support to
calculation methodology of Scarcity Price. This is a relevant
that firm in the production of energy. The generator that
variable in the Reliability payment scheme, which finally
acquires an OEF will receive fixed compensation during
was embodied in Resolution CREG 140 of 2017, which
the commitment period, whether or not the fulfillment of
greatly mitigated the decouple risk between such value
its obligation is required.
and the variable costs of generation resources, enabling to
reflect the market and gradually, the local fuel costs; and;
The price for each KWh hour of OEF corresponds to the
ii. In the incorporation of Non Conventional Renewable
closing value in the auction for the firm energy or Reliability
Sources (FRNCE) to the system, where the CREG approved
payment. When this firm energy is required, what happens
the methodology that establishes the Firm Energy for solar
when the spot price overpasses the shortage prices,
and wind resources. Proposals were formulated to the
an agent fulfillment balance, where they verify the ideal
regulator related to the contracting schedules, including
dispatch if the agent covered its OEF with their own
long, medium and short-term visions, and complementary
resources and delivered surplus or another agent covered
services for its development and promotion.
the OEF, in which case the differences valued at the spot
price are balanced.
In 2014 Law 1,715 was enacted, which regulated the
integration of NCRE to the National Energy System, and
Regulation in Distribution
Companies
whose purpose was to promote the development and use
In Colombia, distribution companies are free to purchase
of non-conventional renewable sources of energy and to
their supplies, being able to define the conditions of the
promote an efficient management of these sources.
public bidding processes to acquire the energy required for
the regulated market and may also go to the spot market
That same year, the CREG issued the Statute of Risk of
to buy energy. The price paid by the end user reflects an
Shortage, which is a mechanism of last resort that acts
average of the purchase price. Since 2004, CREG has been
when under conditions of critical hydrology, the market
working on a proposal to modify the contracting operation in
fundamentals do not behave as expected. In general,
the Colombian market, called Mercado Organizado -MOR-
the scheme consists in the implementation of market
that would become an electronic system of contracts.
monitoring indicators, which helps to identify if the price
This mechanism would replace current tenders for energy
signals (energy market) is coherent with future energy
auctions with standardized commercial conditions, where
estimates and current hydrological conditions of the
the demand to be contracted would be treated as a single
system.
aggregate demand.
If market parameters for monitoring capture any alert and
Distribution charges are set by the CREG based on the
risk conditions, we proceed to declare a risk of shortage
new replacement value of existing distribution assets, cost
period, basically consisting of a scheme of sale and
of capital, non-electric assets; as well as operational and
embalming of energy, which guarantees that the system
maintenance costs for each company, and are defined for
will have the necessary reserves to fulfill the demand. If
four different voltage levels, as follows: Level 1 less than 1
water containment is achieved through the intervention
kV, Level 2 greater than or equal to 1 kV and less than 30
of supply prices of hydraulic agents with capacity in their
kV, Level 3 greater than or equal to 30 kV and less than 57.5
reservoirs, thus allowing the use of the thermal resources
kV and Level 4 up to or equal to 57.5 kV and less than 220
necessary to ensure the reliability of the system.
kV. Voltage Levels 1, 2 and 3 are called Local Distribution
Systems (SDL) and Level 4 is called the Regional
During 2017 regulatory management was focused towards
Transmission System (STR in its Spanish acronym).
the analysis and adjustment of the normativity of the
119
Regulatory Framework of the Electricity Industry In 2009, after auditing the information reported by the
companies, CREG determined the applicable distribution
charges, which are set for a period of five years, and
updated monthly according to the producer price index.
Regulation
of Transmission
The methodology for calculating distribution charges
Transmission networks operating at 220 kV or above
includes an incentive scheme for administration, operation
constitute the National Transmission System
(STN).
and maintenance costs based on the quality of service.
The transmission fee includes a charge that covers the
For energy losses, the regulation establishes a path of
operating costs of the facilities, and a charge for use that
recognized loss indexes to be included in the tariff.
applies only to the merchants who transfer it directly to the
The review of distribution charges began in 2013 with the
final users.
publication of the remuneration methodology proposed by
The CREG guarantees transmission companies a fixed
resolution CREG no. 043/2013. These bases were increased
annual income. This income is determined by the reposition
by CREG Resolution No. 079/2014 which contains the
value of the network and equipment, and by the resulting
purposes and guidelines for remuneration of distribution
value of the bidding process that have awarded new
and Resolution CREG No. 179/2014, Resolution CREG No.
projects for the expansion of STN. This value is attributed
024/2016, Resolution CREG Nº 176/2016 and Resolution
the retailers the STN in proportion to the energy demanded.
CREG No. 019/2017 define a proposal of remuneration
methodology.
The construction, operation and maintenance of the new
projects is assigned to the company that offers the lowest
Finally, after four resolutions subject to consultation, on
present value of cash flows necessary to carry it out.
February 2, 2018 the final resolution CREG 015 was issued.
This norm defines the beginning of a new regulatory period
The revision of regulated transmission charges began in
where the regulator introduced replacement incentives,
2013 with the publication of the pay rate methodology
including depreciation as part of the tariff formula,
proposed by resolution CREG no. 042/2013. These pay
incentives to the quality of service that should improve
rate is complemented by the development of the purposes
at least 8% per year and defined the management of
and guidelines for the remuneration of transmission for
regulatory adjustments to remunerate through tariffs the
the period 2015-2019, which was presented in resolution
investments and the operations related to Infrastructure of
CREG No. 078/2014 and draft resolutions that have
advanced measurement.
been submitted for consultation, Resolution CREG No.
178/2014, Resolution CREG Nº 023/2016 and Resolution
Furthermore, on February 5, 2018
the Regulation
CREG Nº 177/2016 that define a proposal of remuneration
Commission enacted resolution 016 of 2018, which defines
methodology. This resolution was defined by the MME and
the return rate (WACC) for the electricity distribution activity
aims to guarantee adequate assets and timely extensions.
in the national interconnected system and the scheme of
It is expected that the new methodology of remuneration
maximum revenue for the new tariff process. The rate
of the transmission and the new charges of transmission
value is the result of the application of the methodology
will be published during 2018.
approved in Resolution CREG 095 of 2015.
The value of WACC for 2018 was defined in 12.4%, and for
2019 onwards will be 11.8% real before taxes.
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Annual Report Enel Américas 2017 Regulation in
Commercialization
Trading charges for regulated customers are established in
accordance with CREG Resolution no. 180/2014. The main
changes in this formula were the creation of a monthly
fixed charge that covers operating expenses plus a variable
The commercialization market is divided into regulated
of income for traders covering credit risk, working capital
customers and unregulated customers. Customers in
subsidies and other selling costs.
the free or unregulated market can freely contract their
electrical supply directly from generator or distributor
In January 2017, the Regulation Commission -CREG
acting as traders, or from a pure trader. The market for
approved the merger of Codensa and EEC markets. This is
non-regulated customers consists of customers with a
why a unique regulated tariff is applied from that date for
maximum demand of more than 0.1 MW or a minimum
users of the market currently served by Codensa.
monthly consumption of 55 MWh.
The commercialization or trading can be performed by
generators, distributors or
independent agents that
meet certain requirements. The parties freely agree on
transaction prices for unregulated customers.
The trader of energy is responsible for billing electricity costs
to final consumers and transferring payments to different
agents in the industry. Trading for regulated customers is
subject to the “Regulated Freedom Regime” in which tariffs
are set by each seller using a combination of the general
cost formulas determined by the CREG and the individual
trading costs approved by the CREG for each seller. The
rates include, but are not limited to, costs of energy supply,
transmission charges, distribution charges and a margin of
commercialization. In addition, the final costs of the service
are affected by subsidies or contributions that are applied
according to the socioeconomic level of each user.
Environmental Regulation
The legal framework for environmental regulation in
Colombia was established in Law 99/1993, which also
created the Ministry of Environment as the authority for the
definition of environmental policies. The Ministry defines,
issues and executes policies and regulations focused
on the recovery, conservation, protection, organization,
administration and use of renewable resources.
Any entity contemplating the development of projects
or activities related to the generation, interconnection,
transmission or distribution of electricity, which may cause
an impact, deterioration and/or introduce significant or
notorious changes to the environmental landscape, must
apply for an environmental license prior to the start of
activities.
121
Regulatory Framework of the Electricity Industry
Law No. 99 established that generation power plants
already operating, that have a total installed capacity of
more than 10 MW, should contribute to the conservation
of the environment, transferring to municipalities and
environmental corporations in the area where the power
plants are located, a percentage associated with the
generation of energy. Hydroelectric plants must pay 6% of
Peru
Industry Structure
their generation and thermal plants must pay 4% of their
The general legal framework applicable to the Peruvian
generation, with rates that are determined annually.
electricity industry is primarily comprised by the Electric
Concessions Law (Decree Law Nº 25,844 from 1992) and
In 2011, Decree 3,570 established the new structure of
its regulatory norms.
the environmental sector thus creating the Ministry of
Environment and Sustainable Development (previously,
The Ministry of Energy and Mining (MINEM) defines
the functions of the Ministry of Environment were
energy politics applicable on a national level, jointly
established along with the functions of the Ministry of
regulates with the Ministry of the Environment, the
Housing). In the same year, Decree 3,573 created the
environmental aspects applicable to the energy sector and
National Environmental Licensing Authority as the entity
is the competent authority for the granting and expiration
responsible for granting and monitoring environmental
of authorizations and concessions for the activities related
licenses, permits and procedures of the Ministry of
to the generation, transmission and distribution of energy.
Environment and Sustainable Development.
During the COP21 in Paris in 2015, Colombia committed
and Mining (Osinergmin) is the regulatory entity that
to reduce 20% emissions as of 2030 with respect the
controls and oversees the enforcement of legal and
The Supervising Organism of the investment in Energy
reference baseline.
technical norms related to the electricity, hydrocarbon, and
mining activities, and enforces the obligations established
In 2015, on the recommendation of the OECD, the
in concession contracts. On its part, the Regulating
regulation of the environmental sector was consolidated in
Osinergmin Tariffs Agency (GRT) is the competent authority
the Decree 1076 of 2015.
for the determination of regulated tariffs. Osinergmin also
controls and supervises the bidding processes required by
In general and as of today, the environmental regulation
distributing companies for the purchase of energy from
for the electricity sector has been focused on regulating
generators.
aspects related to: i) emissions from thermal plants; (ii)
formulation, issuance and implementation of the National
Meanwhile, the Environmental Evaluation and Enforcement
Policy for Integral Management of Water Resources,
Organism (OEFA), which depends on the Ministry of
updating the regulations associated with landfills, regulation
the Environment, is responsible for the supervision and
the methodology for the calculation of the environmental
enforcement of the environmental obligations contained in
flow, and structuring and management of watersheds);
the approved environmental instruments.
(iii) environmental
licensing and compensations, for
subtraction of forest reserves and exploitation, for loss of
The Economic Operation System Committee (COES) is the
biodiversity for projects bound to environmental licensing;
National Electric Interconnected System Operator (SEIN),
(iv) updating the regulatory framework for environmental
coordinates the dispatch of generation units in function of
licensing and regulating the environmental sanctioning
the minimum cost, and prepares diverse studies that serve
regime.
122
Annual Report Enel Américas 2017
as a base to annually calculate the bar prices, manages the
Generation companies can sell their energy directly to
short term market, and elaborates the Guaranteed System
distribution companies and free clients and liquidate their
Transmission Plan. In the COES generating, transmitting,
differences in the spot market at marginal costs. The
and distributing companies are represented, as are Big
sales to non-regulated clients are carried out in prices
Users (free clients whose consumption is higher than
and conditions mutually agreed, which includes fees and
10MW).
compensations by the use of transmission systems, and if
it is the case, fees for the use of the distribution networks.
In rural areas there are small isolated electric systems
The Electric Concessions Law allows the subscription of
that supply electricity in specific areas, which represent
bilateral contracts of a price no greater than the Bar Rates,
approximately 6% of the total national production.
in the case of regulated clients, or at a price agreed by
all parts in the case of unregulated clients. As well as this
The main characteristics of the electric industry in Peru
bilateral method, Law 28,832 from 2006, denominated
are: (i) the separation of the three activities: generation,
the Law to Ensure Efficient Development of Electric
transmission, and distribution; (ii) open market for the
Generating, also established the possibility that distributors
supply of energy to unregulated clients; (iii) a regulated
can satisfy regulated and unregulated client demands by
price system, primarily based on a long and short term
concluded agreements after a power bidding process and
bidding regimen.
Regulation of Generation
Companies
energy supervised by Osinergmin. The approval of this
mechanism is important for the generators because it
allows them to dispose of a stable price during the contract
life, which is not set by the regulator and can have duration
of up to 20 years.
Generation companies that own or operate a generation
Due to the introduction of bidding mechanisms, a large
plant with an installed capacity larger that 500 KW require
portion of the contracts to sell energy to distributing
a definitive concessions given by the MINEM.
companies to get the client’s attention, comes from these
The dispatch coordination of electricity operations, the
bids. Just a small portion of the electricity bought by
determination of the spot prices and the management of
distribution companies, is maintained under the bilateral
economic transactions that occur in the SEIN are managed
contract scheme.
by the COES.
123
Regulatory Framework of the Electricity Industry Another norm that impacted the electric market was
On September 2015 the Decree N° 1,221 was published,
Urgent Decree N° 049-2008, which introduced the so-
through which the fixed VAD (Distribution Added Value)
called “Ideal Marginal Cost”, which assumes that for
establishes that it will be carried out every four years and
economic dispatch effects, SEIN marginal costs in the
will be calculated for each company (before this decree the
short term are determined considering that there are no
VAD was calculated for a company that was representative
restrictions in natural gas (production or transport), nor for
of the group and typical sector, and this VAD is applied to
electricity transmission; and that marginal costs cannot be
all of the companies that made up the respective group).
superior to a limit value defined by the Ministry of Energy
Also, an additional charge to the fees in technologically
and Mining, said Urgent Decree was valid until October 1,
innovative projects and efficient energy projects previously
2017.
approved by the Osinergmin. Incentives were offered to
improve the quality of service and the possibility to expand
With regards to the transactions in the wholesale market,
the concession areas for distribution companies in rural
the Regulation of the Electricity Wholesale Market
areas next to their concession zones.
(Regulation MME) was approved through Supreme Decree
Nº 026-2016-EM. The main aspects are the following: The
The real return on the investment of a distribution
“MME” is comprised by the short-term market (“MCP”
company depends on its performance with respect to
in its Spanish acronym) and the allocation mechanisms of
the standards set by Osinergmin for a theoretical model
complementary services, operational inflexibilities and
company. The tariff system allows a greater return to the
the allocation of congestion revenues. The authorized
distribution companies that are more efficient than the
participants to buy in the MCP are: generators to serve
model company. The preliminary tariffs are determined by
their supply contracts, distribution companies to serve free
taking as a base the results of a study hired the company,
customers for up to 10% of its maximum demand; and large
corrected according to the Osinergmin. Preliminary tariffs
users to serve up to 10% of its maximum demand. COES
are checked to ensure that the internal return rates are
will calculate the energy marginal costs and the congestion
12% with a +/- 4% variation. Also, the tariffs are indexed
marginal costs. Participants will need payment guarantees
to the exchange rate, the price index to the greatest (IPM),
of their obligations in the MME. In addition, action from
and the commodities price as is copper and aluminum,
COES are incorporated in the event of a payment default
with which Peru has no exchange risks.
of a participant.
In Peru the capacity payment is given by the amount that
defined the Edelnor tariffs for the period of November
compensates the development of turbine gas, as a marginal
2013 to October 2017. The same have been extended until
unit to contribute to the system’s demand. Similar to Chile,
October 31, 2018, through the Ministerial Resolution N°
the capacity payment is independent from dispatch and
530-2016-MEM/DM published in December 2016.
During the last setting tariff process, the OSINERGMIN
remunerates the availability and contribution to the aimed
reserve margin decided by the competent authorities.
Regulation for Distribution
Companies
The electricity tariff for regulated clients includes charges
for energy and power, for the generation and transmission,
and the Distribution Added Value (VAD) that considers a
regulated return for investments, fixed operating charges
and maintenance, and a standard percentage for energy
losses in distribution.
Regulation of Transmission
Transmission activities are defined under different regimes.
The facilities built before 2006 are divided in the Main
System, that is for common used and allows the flow of
energy through the national net, and the Secondary System
is mostly unidirectional and are useful for evacuating
energy from one generation power plant or to take energy
to the final consumer.
124
Annual Report Enel Américas 2017 For its part, the facilities built after 2006 are divided in:
Guaranteed System formed by lines for common use,
part of the Transmission Plan developed by the COES and
whose toll y paid by the whole demand of the network, and
the Complementary System whose lines are connected to
a power plant or to a user of the system and are paid by
the beneficiary.
Environmental Regulation
The environmental legal framework applicable to the
activities related to energy in Peru is established in the
Environmental General Law (Law N° 28,611) and in the
Environmental Protection Rules for Electric Activities
(Supreme Decree 029-94-EM).
The Transmission Plan, elaborated by the COES and
approved by the MINEM, determines the development
of the Guaranteed System lines, which are bid through a
BOOT framework with a maximum duration of 30 years.
The transmission concessions of the Guaranteed System
receive an annual fixed income from said bids.
The Complementary System lines are developed through
investment plans presented by the agents and approved
by the Osinergmin, an entity that calculates the average
annual cost to remunerate for each installation, considering
the standard investment, operating, and maintenance
costs, with an updated rate of 12% before tax and a useful
life of 30 years.
The Legislative Decree 1,002 creates a promotional regime
for non-conventional renewable energies (“ERNC” in its
Spanish acronym). Guaranteed revenues will be paid by the
demand through a tariff charge included in the connection
toll. Renewable generation is promoted through auctions.
The Regulation included in DL 1002 (Supreme Decree
050-2008-EM) incentives electricity generation of Non-
Conventional Renewable Energies (ERNC in its Spanish
acronym). This Decree establishes that up to 5% of
electricity demand of the Interconnected System can be
provided by non-conventional renewable sources. The
5% limit may be reviewed by the relevant authorities in
accordance with the National Plan for Renewable Energies.
The technologies considered as renewable resources are:
biomass, wind, tidal energy, geothermic, solar and mini-
hydro (hydroelectric with capacity below 20 MW).
As of December 2017 the proportion of NCRE was 2.8%
in the SEIN demand, as a result of the fourth tender
adjudicated in 2016. The percentage is estimated to be
4.0% in December 2018.
125
Regulatory Framework of the Electricity Industry 16Description of the electricity business by
country
126
Annual Report Enel Américas 2017 127
Letter from the Chairman Electricity Generation
In this segment, Enel Américas owns operating subsidiaries in Argentina, Brazil, Colombia and Peru.
As a whole, the gross installed capacity of the Enel Américas Group reached 11,219 MW as of December 2017 and the
consolidated electricity generation amounted to 41,053 GWh, while energy sales totaled 56,051 GWh.
In the electricity industry, the business segmentation between hydro and thermal generation is natural, since the variable
costs of generation are different for each method of electricity production. Thermal generation requires the purchase of
fossil fuels and hydroelectric generation requires the water that comes from dams and rivers.
55% of our consolidated generation capacity comes from hydroelectric sources and 45% from thermal sources. Hence,
the definition of the generation company’s commercial policy is relevant for the proper management of the business.
Electricity Transmission
The electricity transmission business for Enel Américas is mainly performed through the interconnection line between
Argentina and Brazil, Enel Cien, subsidiary of Enel Brasil, whose transport capacity is 2,100 MW.
Electricity Distribution
The distribution business is conducted through Edesur in Argentina, Enel Distribución Río (former Ampla), Enel Distribución
Ceará (former Coelce) and Enel Distribución Goiás (former Celg) owned by Enel Brasil in Brazil, Codensa in Colombia and
Enel Distribución Perú (former Edelnor) in Peru. During 2017, our main distribution subsidiaries sold 74,337 GWh.
Currently, Edesur, Enel Distribución Río, Enel Distribución Ceará, Enel Distribución Goiás, Codensa and Enel Distribución
Perú serve the main cities in Latin America, providing electricity service to more than 17.2 million clients.
128
Annual Report Enel Américas 2017 Argentina
Participations in installed capacity and in business Groups
for 2017 are distributed as follows:
Participation in installed capacity and in Business Groups in 2017
Electricity Generation
Enel
SADESA
AES
Regional Governments
Pampa Energía
Enel Américas S.A. participates indirectly in electricity
Foninvemem
generation through Enel Argentina S.A.’s subsidiaries Enel
National Government
Generación Costanera S.A. (Costanera), Enel Generación
Others
El Chocón S.A. (Chocón) and Central Dock Sud S.A. (CDS).
12.5%
10.8%
8.6%
7.9%
9.8%
6.4%
19.9%
24.1%
Among the most relevant news of the year, worth is to
Costanera, Chocón and CDS own together 4,537 MW of
mention the biddings carried out by the new Government
gross installed capacity. This capacity represented by the
for the creation of new generation offer. To that effect,
end of 2017, 12.5% of the total capacity in the Argentine SIN
noteworthy is the Thermal Bidding performed under
(National Interconnected System). Electricity generation
Resolution 287/2017, which awarded 1,810 MW of new
of these companies reached 14,829 GWh on December
thermal generation of these technologies: a) closing of
31, 2017, equivalent to 10.9% of the total generation of
combined cycle or b) cogeneration, with the commitment
Argentina.
to be available to satisfy the demand in the MEM, and the
biddings performed under the Program RenovAr Round 2,
Worth is to mention that, among the most important
in order to create new generation capacity from Renewable
business groups that participates
in the Argentine
Energies. In this program, the total capacity awarded is:
Electricity Market
in generation are: AES, SADESA
through Round 2 of Program RenovAr 88 projects for 2,043
and PAMPA ENERGIA, company that in 2016 acquired
MW in 18 provinces. The Program RenovAr is contained
Petrobras Argentina. Other companies with participation
in Law 27,191, which establishes a path of participation in
in the generation business are YPF Energia, CAPEX and
these types of energies in the market that for 2025 should
Pluspetrol Energía, acquired by YPF.
reach 25%.
129
Description of the electricity business by country Enel Generación
Costanera S.A.
As a result, the operations performed by the net generation
of the Convectional Units of Costanera reached 1,460
GWh, and the net generation of Combined Cycles reached
6,398 GWh.
Costanera is located in the city of Buenos Aires and has six
steam turbine units totaling 1,131 MW, and can generate
In January 2017, the Secretary of Electric Energy
with natural gas or fuel oil. It also operates two combined
depending on the Ministry of Energy and Mining updated
cycles of 851 MW and 322 MW respectively; and its gross
through Resolution N° 19/2017 the remuneration values of
installed capacity is 2,304 MW.
Resolution SE N° 22/2016 to be applied from February 2017.
It should be recalled that on October 6, 2016, the Company’s
The implementation of Resolution SEE N° 19/2017 triggered
Extraordinary General Shareholders’ Meeting approved the
an increase of remuneration of around 50% in relation
amendment of Article 1st of the bylaws, where company
to the previous regulation. Basically the remuneration
name was modified from Sociedad de Central Costanera
concepts were simplified. There is a capacity charge, which
S.A. for “Enel Generación Costanera S.A.”, which is already
varies in relation to technology and size of the unit, and a
registered.
variable charge. The values are defined in dollars.
During 2017 CAMMESA performed the dispatch of SADI
Since the sanction of Resolution SEE N°19/2017, it was
according to the resolutions established by the Secretary
established for thermal units the possibility to offer
of Energy. In this context, the priority was the dispatch
commitments of guaranteed availability, and additional
of Turbo Steam units consuming fuel oil (FO) until mid
guaranteed availability
(DIGO and DIGO Additional
April 2017. Later, the dispatch was maintained prioritizing
respectively) with the same differential remuneration for
natural gas (a mix of national gas, liquefied natural gas
every technology.
(LNG) and gas imported from Bolivia), taking into account
the efficiency of the units and the use of liquids (gas oil
In this sense, in 2017 Costanera participated in the Winter
and fuel oil) in accordance to the restrictions imposed for
Seasonal Programming (from May 1 to October 31, 2017)
Usinas during the season of high residential demand.
and the Summer Seasonal Programming (from November
1 to April 30, 2018) of the commitments of guaranteed
availability. This mechanism has generated for the Company
revenues for a total of ARS$ 1,160 million in the period
May-December 2017.
130
Annual Report Enel Américas 2017 The hydrological year starts on April 1, and has been
characterized as dry accordingly the contribution of the
hydrological basins of the Rivers Limay and Collón Cura.
Net generation recorded for these power plants during the
year was 2,027 GWh. This generation was produced by
1,497 GWh in El Chocón (74%), 411 GWh in Arroyito (20%)
and 119 GWh by motogenerators (6%).
The Company started 2017 with a level of the reservoir of
374.79 meters above sea level (m.a.s.l.). The reserve El
Chocón dam was 1,807 GWh and in the Comahue it was
5,278 GWh. Both amounts were measured in relation the
minimum height condition of FOE.
At the end of year 2017, the level of the reservoir reached
377.62 m.a.s.l. The energy reserve of the Comahue dams
were 5,915 GWh of which 2,156 GWh were reserves of El
Chocón.
In January 2017, the Secretary of Electric Energy, which is
subordinate to the Ministry of Energy and Mining, through
Resolution N° 19/2017 updated the remuneration values of
Resolution SE N° 22/2016 to be applied from February 2017.
The
implementation of Resolution SEE N°19/2017
prompted a change in the remuneration of thermal and
hydro generators in relation to the previous regulation. The
remuneration concepts were simplified, thus considering
a capacity charge, which varies in relation to technology
and size of the unit, and a variable charge. The values are
defined in dollars.
Additionally, since this Resolution SEE N°19/2017, it
was established for thermal units the possibility to offer
commitments of guaranteed availability, and additional
guaranteed availability
(DIGO and DIGO Additional
respectively) with the same differential remuneration for
every technology.
Starting from motogenerators, in 2017 Chocón participated
in the Winter Seasonal Programming (from May 1 to
October 31) and the Summer Seasonal Programming
(from November 1 to April 30, 2018) of the commitments
of guaranteed availability. This mechanism has generated
for the Company revenues for a total of ARS$ 10.9 million
in the period May-December 2017.
131
Enel Generación
El Chocón S.A.
Hidroeléctrica El Chocón SA is a hydroelectric generation
company, which operates El Chocón and Arroyito power
plants, located on River Limay. It’s located in the provinces
of Neuquén and Río Negro. The hydroelectric complex has
1,328 MW total gross installed capacity and includes El
Chocón plant, with 1,200MW installed capacity (artificial
reservoir’s hydroelectric power plant) and Arroyito plant,
with 128 MW installed capacity, both using the waters of
Rivers Limay and Collón Curá for generation.
The gross hydro installed capacity of the Company is 1,328
MW; thermal gross capacity is 35.6 MW and corresponds
to motogenerators. Its participation in the SADI is 4% in
relation to the total installed capacity.
El Chocón is located in the Comahue region, consisting of
the Argentinean provinces Río Negro, Neuquén and the
southern areas of Buenos Aires provinces, over the Limay
River, 80 km upstream from the confluence with Neuquén
River. Arroyito is the compensator dam of El Chocón and is
located in the same river, 25 km downstream.
Description of the electricity business by country Dock Sud Power Plant
and size of the unit, and a variable charge. The values are
defined in dollars.
Dock Sud power plants located in Avellaneda district,
Buenos Aires. Dock Sud owns and operates a single
Since Resolution SEE N°19/2017, it was established
generation power plant with two units, with a total capacity
for thermal units the possibility to offer commitments
of 870 MW. Dock Sud power plant (CDS in Spanish
of guaranteed availability, and additional guaranteed
acronym) has four gas turbines and one steam turbine. Two
availability (DIGO and DIGO Additional respectively) with
of the gas turbines and the steam turbine comprises once
the same differential remuneration for every technology.
combined cycle power plant.
The energy generated by Dock Sud in 2017 reached 4,944
Programming (from May 1 to October 31) and the Summer
GWh, participating in 5.6% of thermal generation and
Seasonal Programming (from November 1 to April 30,
covering 3.7% of the SADI demand.
2018) of the commitments of guaranteed availability.
To that effect, CDS participated in the Winter Seasonal
On December 31, 2017, the installed capacity of Central
Since 2015 there is a loan obtained from CAMMESA,
Dock Sud S.A. represented 2.4% of the total installed
whose purpose was to finance the costs related to the
capacity in the SIN.
combined cycle major maintenance. Pursuant to Article
N°7 of Annex 2 of Resolution SEE 19/2017, in December
In January 2017, the Secretary of Electric Energy, which
2017 the Company singed and Addenda to the existing
is subordinated to the Ministry of Energy and Mining,
mutual contract, where the payment method of the
through Resolution N° 19/2017 updated the remuneration
aforementioned loan was adjusted in relation to the
values of Resolution SE N° 22/2016 to be applied from
remuneration established in the previous regulation and
February 2017.
the use of credits of the Additional Remuneration of Trust
(RAF in Spanish acronym). In this sense, the compensation
The
implementation of Resolution SEE N°19/2017
between the updated debt and the RAF credits was
prompted a change in the remuneration of thermal and
performed, thus the new capital balance was ARS$224.9
hydro generators in relation to the previous regulation. The
million to be paid in 24 installments plus interests (at
remuneration concepts were simplified, thus considering
CAMMESA interest rates). The first installment was paid
a capacity charge, which varies in relation to technology
in December 2017.
132
Annual Report Enel Américas 2017 Activities and projects
in generation
Projects
Expression of interest for the
development of infrastructure
projects
In the context of the changes in regulation that the Argentine
government is performing and the variety of biddings that
have been done, and new ones that the government plans
to convene to carry out new investments in energy, the
Company is analyzing the potential installation of a new
combined cycle in Costanera.
The intention is to compete for electricity energy contracts
in those biddings that the Ministry of Energy and Mining
might offer during the second semester of 2018, and
where a process has been already opened in 2017 for the
potential interested entities to present projects in this
process.
The project would consist on the installation of a combined
cycle unit, with an installed capacity of 450 MW, connected
to the voltage bars of 220 kV and 132 kV of the existing
Costanera substation. The operation would work with two
types of fuel (natural gas or diesel). Nevertheless, there’s a
preference for natural gas and when it’s not available diesel
would be used.
The construction period is estimated in 30 months,
depending on the technical specifications to be selected.
Vuelta de Obligado Power Plant
Project
The Vuelta de Obligado S.A. (VOSA in its Brazilian acronym)
project includes the installation of a combined cycle of
nearly 800 MW of installed capacity, during 2017 the two
gas turbines of 270 MW of capacity each one continued
operating in simple cycle. The commissioning of every
installation of the new power plant is planned for the fist
quarter of 2018, and consists in two gas turbine combined
cycle and one steam turbine.
Once the combined cycle is put in motion, the devolution
of the debt of CAMMESA with generation companies will
start. These generation companies contributed to such
project through a 10-year supply contract at a 30-day Libor
rate plus 5%, pursuant to the Generators Agreement 2008-
2011.
Land Reserved
Projects
for Future
In Argentina, Enel Américas doesn’t have any land reserved
for future projects.
133
Description of the electricity business by country Electricity Distribution
Edesur
responsibility of such entity.
On February 1, 2017 the Integral Tariff Review came into
force, thus ending the process of renegotiation of the
concession contract, and reestablishing the full validity
of the Concession Contract, the Tariff Regime and the
Quality of Service, which were renegotiated base don the
Edesur’s main purpose
is
the distribution and
principles established by Law 24,065.
commercialization of electricity in the southern area of
Buenos Aires. This includes two-thirds parts of the city of
This milestone is critical for the company, because it
Buenos Aires’ area and twelve districts of Buenos Aires
means the complete restoration of conditions of certainty
province, covering 3,309 km2, for a period of 95 years
and sustainability of the business, and also defines
starting from August 31, 1992.
conditions and basic criteria (formation of capital base and
calculation of WACC) for future tariff revisions throughout
This period includes an initial one of 15 years and eight
the concession period.
additional periods of 10 years each. On February 5, 2007,
the National Electricity Regulatory Entity (ENRE) resolved
Its worth mentioning that along the tariff cycle of the RTI
to extend the initial period for five additional years, from
term, established between February 1, 2017 and January
the completion of the Integral Tariff Review (RTI) process.
31, 2022, the quality of service regime will increase
its requirements according to the expectation of the
Later, on January 27, 2016, the Resolution MINEM N°
development of investments and operational improvements
7/2016 was enacted, which instructed ENRE, among other
that EDESUR proposed in the context of RTI. Therefore,
things, to: perform an adjustment to the VAD in the tariff
the quality guidelines will be more demanding and the
charts of the Company, on behalf of the RTI (Integral Fees
cost of energy not delivered will increase throughout the
Renegotiation) and the framework of the Transitory Tariff
period, reaching the values established recently in the last
Regime established in the Agreement Act and to carry our
semester of the cycle.
every act needed to proceed the RTI, which should come
into force before December 31, 2016. The process and
The concession contract establishes for Edesur the
schedule for the RTI was established through Resolution
obligation to supply energy according to the demand
ENRE 55 as of April 5, 2016.
of the owners or inhabitants of the properties within its
Within the framework of the RTI process, on October
with certain quality standards related to the electricity
28, 2016 the public hearing was held to inform and hear
supplied,
to comply with operational
requirements
the opinions with regards to the tariffs proposals that the
concerning the maintenance of distribution assets and to
distribution companies Edesur and Edenor presented to
bill clients on the basis of actual measurements.
concession area, it also demands the company to comply
the ENRE according to Resolution ENRE N° 55/2016.
In December 2017 the Ministry of Energy and Mining
On December 30, 2016, the ENRE enacted Resolution
(MINEM) presented its proposal and criteria for the
N° 626, approving the document denominated Final
treatment of regulatory liabilities. The first measure was,
Public Hearing Resolution with the purpose to inform
through the Note issued on December 30, 2017, that the
and answer the opinions made in relation to the Tariffs
Ministry informed that CAMMESA took possession of
Proposal presented previously by the companies with
the debt registered by EDESUR with this company for
regards to the definition of tariffs to be applied, and to
the purchase of energy, for a period of 90 days pending
transfer the considerations of the Subsecretary of Tariffs
to formalize the aforementioned agreement. EDESUR is
Policy Coordination of the Ministry of Energy and Mining of
working on the latter to comply with the agreed deadlines.
the Nation, those subjects planned that are not under the
134
Annual Report Enel Américas 2017
At the same time and with the purpose of regain the
normal structural conditions, the National Argentinean
Stage 2
Government decided not to extend the validity of the
Electricity Emergency Law (in effect until December 31,
> Commissioning of a new MT feeder in Pompeya and a
2017) and the Economic Emergency Law (in effect until
line of 3 new feeders in Patricios and six support links.
January 6, 2018).
> Transfer of feeders from old sections 3 and 4 to the new
sections 3 and 4.
In 2017 Edesur delivered electricity power service to
> These works improve the energy supply in San Cristóbal
2,529,307 clients, representing 0.99% growth in relation
–Parque Patricios –Constitución – Boedo neighborhoods.
to the previous year. Of the total, 87.9% are residential
customers, 10.8% commercial customers, 0.9% industrial
The works of both stages represented materially the wiring
customers and 0.4% other users (institutional). Energy
of 13,950 mt of CSMT (240 m of 3x1x400 Al and 13.710
sales reached 17,736 GWh, including the distribution
m of 3x1x185 Al) and the renovation of 12 transformation
services (tolls) to large users, at similar levels than the
centers.
previous year. Sales distribution was: 43.6% residential
sector, 25.4% commercial sector, 7.5% industrial sector
Additionally, the substation was prepared to supply of Villa
and 23.3% others (4.3% institutional, 2.9% public lighting
Olímpica, Parque Olímpico and the neighborhoods Procrear
and 16.1% tolls).
(Saenz station) at an estimated capacity of 17 MW.
Expansion of Padre Novak
This work consisted in the installation of four new feeders
from the SE Padre Novak. Also 13 km of medium tension
network new wiring were installed, benefitting users mainly
from the villages of San Juan, Villa Vatteone, Gobernador
Costa and Santa Rosa (Florencio Varela).
Discharge of SE Temperley
with SE Calzada
This project consisted in the installation of two new
feeders from the SE Calzada. New wirings of 15 km of
medium tension network were made, with the purpose
of discharging feeders of the SE Temperley and thus
benefit users from the villages of Adrogué and Temperley,
Almirante Brown and Lomas de Zamora respectively.
In 2017 the annual mobile loss rate (technical and non
technical) reached 12.04%, meaning an improvement
in relation to 2016 (12.44%). This result is achieved in a
scenario of negative variation of demand.
Activities and projects
in distribution
Expansion of SE Pompeya
These works were carried out in two stages:
Stage 1
> Commissioning of three MT new feeders and two new
support links.
> Transfer of feeders from old sections 1 and 2 to the new
sections 1 and 2.
> These works
impact the
improvement of energy
supply in Nueva Pompeya–Barracas–Parque Patricios
neighborhoods.
135
Description of the electricity business by country New Feeders SE Mobile
Roca
This project is the second stage of the SE Móvil Roca
and included the wiring of two new feeders from that
substation. New wiring for 4.5 km of medium tension
network were made to discharge the feeders of the SE
Temperley, benefitting users from the villages of Temperley
and Santa Catalina, starting from Lomas de Zamora.
Technological improvement
of the network
Shaft Chambers
This project comprises the installation of underground
MT/BT Transformation Centers in areas where the grid is
evaluated as vulnerable. In 2017, 20 new chambers were
installed in the City of Buenos Aires distributed in the
following neighborhoods: Caballito, Villa Santa Rita, Villa
General Mitre, Villa Crespo, Villa Devoto, Flores, Floresta,
Mataderos, Villa Luro, Barracas, La Boca, Nueva Pompeya,
Parque Avellaneda and Villa Soldati.
Digitization of the network
In order to improve the quality of service, Edesur begun
The MT feeders under worse SAIDI conditions were
the installation of the first smart meters to digitize its
chosen. The objective was to minimize the interruption
network. The pilot project included the installation of 5,000
periods when facing a failure of any feeder, transferring
equipment in the concession area during 2017.
the charges to the backup feeder in a telecommanded way.
During 2017, 100 equipment were assembled with own
The new smart meters include the technology that Enel
employees, of which 83 are operating and it’s estimated to
is using worldwide, which has many advantages: the
greatly increase this number in the following years.
consumption reading is done remotely and more precisely;
network failures are identified in real time, therefore repair
times would be much shorter; and allows the user to read
consumption data constantly, while leading to a more
efficient energy consumption.
136
Annual Report Enel Américas 2017
Brazil
Electricity Generation
Volta Grande
Enel Américas through its subsidiary Enel Brasil acquired the
rights to operate for a 30-year period Volta Grande hydroelectric
power plant, which is located in the Rio Grande, between the
Brazilian states São Paulo and Minas Gerais. The total cost of
the concession was BRL$1,420 million (approximately US$420
Enel Américas participates in electricity generation through
million).
Enel Brasil and its subsidiaries Enel Green Power Cachoeira,
Volta Grande and Enel Generación Fortaleza.
Enel Brasil won the auction for hydroelectric concessions
These three power plants, two hydroelectric and the other
in an open public session at the São Paulo Stock Exchange. The
thermal, add up 1,354 MW total net capacity, representing
operation of the asset began on November 11, 2017.
performed by the Brazilian government on September 27, 2017,
0.88% of the capacity of Brazilian SIN.
In Brazil, electricity generation of the Group reached 4,034
debt and 40% with equity. Initially a two-year bridge loan (2018-
GWh, reaching 0.7% of the total generation in the country
2019) was considered, under the guarantee of Enel. During the
(thermal and hydro), where hydroelectric production
bridge loan term, a long-term financing would structure.
The acquisition of this concession was financed 60% with
represented 52% of the total generation of the Enel
Américas Group in Brazil.
The proportional net generation of Enel operation in 2017 was
Other generators connected to the Brazilian SIN are: CHESF,
Furnas, Cemig, Electronorte, Cesp, Copel, Eletrobras and
With this acquisition, Enel Brasil increased in 40% its
Eletropaulo.
hydroelectric capacity in Brazil, adding 380 MW to its portfolio.
137 GWh, and also the sales.
Enel Green Power Cachoeira
Dourada
Cachoeira is located in the State of Goias, 240 km south of
Goiânia. The power plant owns ten units with 665 MW of
net installed capacity. It’s a run-of-the-river power plant and
uses the waters of River Paranaiba.
Enel Generación Fortaleza
Fortaleza is located in Caucaia municipality, 50 km from the
capital of Ceará state. Fortaleza is a 319 MW combined
cycle thermal power plant that uses natural gas; and is able
generate one third of the electricity needs of Ceará, state that
has a population of nearly 9 million inhabitants.
Net generation in 2017 reached 1,965 GWh, and sales
amounted to 9,526 GWh.
Fortaleza was built in a 70 thousand square meters area,
and is part of the infrastructure of the Industrial and Port
Complex of Pecém, in Caucaia municipality, and is part of
the Thermoelectricity Priority Program (PPT) of the Federal
Government. Fortaleza has a strategic location to boost
regional growth and to facilitate the setup of other industries.
Its main customers are Coelce and Petrobras.
Electricity generation in 2017 was 1,932 GWh, while sales
reached 2,923 GWh.
137
Description of the electricity business by country Land reserved for
future projects
Enel Brasil owns an area of 75 hectares in the city of Macaé,
State of Rio de Janeiro, reserved for a new thermoelectric
project.
Electricity Transmission
Enel Américas Group also participates in the transmission
and sale of electricity in Brazil through the interconnection
line between Argentina and Brazil, through the Enel Cien,
holding 99.3% ownership.
Enel Cien
Electricity Distribution
in Brazil
Enel Cien is an energy transmission company in Brazil.
The complex consists of two frequency conversion
stations, Garabi I and II Garabi II, converting both ways the
frequencies of Brazil (60 Hertz) and Argentina (50 Hertz)
and transmission lines. On the Argentinean side, they are
managed by two subsidiaries: Compañía de Transmission
del Mercosur S.A. (CTM) and Transportadora de Energía
S.A. (TESA). CIEN has control of 100.0% of the capital in
both companies.
The interconnection system consists of two transmission
lines with a total length of 1,006 km, and the Garabi
Conversion Station, SE STA (Santo Angelo/RS) and SE YTA
(Itá/SC).
Enel Américas participates in distribution through Enel
Brasil and its subsidiaries Enel Distribución Rio, Enel
Distribución Ceará and Enel Distribución Goiás.
Enel Américas owns directly and indirectly economic
ownership of 99.4%, 73.7% and 99.5% of these companies
property, respectively.
In Brazil, main distribution companies in the electricity
system are: CPFL, Brasiliana de Energía, AES Elpa, Cemig,
Light, Coelba and Copel.
Enel Distribución Rio
On April 5, 2011 the decrees were published in the
Enel Distribución Río
(former Ampla)
is an energy
Official Gazette defining the annual value of the Allowed
distribution company with operations in 73% of the
Annual Remuneration (RAP) for Enel Cien. With this, the
territory of the State of Río de Janeiro, which is equivalent
regulator equates Enel Cien (the assets of which consist of
to a 32,188 km2 area. The population is approximately 8
Garabi 1 and 2 lines) to concessionaires of public service
million inhabitants, distributed in 66 municipalities, and
transmission. Total annual RAP is adjusted annually and the
the following are the most important ones: Niteroi, São
tariff review processes will be conducted every four years.
Gonçalo, Petrópolis, Campos and Cabo Frío..
Starting from April 2011, therefore, Enel Cien was officially
authorized to receive payments under this new business
During 2017, Enel Distribución Río provided electricity to
approach.
3,029,751 clients, 2,664,076 of which are with supply and
138
Annual Report Enel Américas 2017 365,675 without supply, 1% less than 2016 mainly due to
During 2017, Enel Distribución Ceará (former Coelce)
the disablement of clients without supply. Out of the total,
supplied energy to 4,016,546 clients, a 3.3% increase
80% are residential clients, 5% are commercial clients
in relation to 2016. Out of the total, 67% are residential
and, 15% other users.
clients, 4% commercial customers and 29% other users,
being rural clients the most representative.
Energy sales in 2017 reached 11,041 GWh, representing a
0.8% decrease in relation to 2016, and the participation of
Energy sales in 2017 were 11,522 GWh, showing a
residential clients was 42% of physical sales, followed by
reduction of 0.9% over 2016. In these sales, residential
17% of sales to commercial customers, industrial clients
clients represented 37%, commercial clients were 17%,
represented 3% and other clients and tolls represented
and tolls and other clients were 46%.
38% of sales. Enel Distribución Río greatly emphasizes
energy theft fight, developing projects for the use of
technology and social activities.
Enel Distribución Goiás
Nevertheless, currently energy losses still represent one
of the main challenges of Enel Distribución Río. The year
2017 ended with 20.35% of energy losses, and compared
with 2016 experienced a 0.95 % growth mainly due to the
increase of risky areas.
Enel Américas through its subsidiary Enel Brasil acquired
94.8% of Enel Distribución Goiás (former Celg) share capital,
a distribution company that operates in the Brazilian State of
Goiás. The amount of the investment reached BRL$ 2,187
million (approximately US$ 640 million).
Additionally, in 2017 Enel Distribución Río also took actions
to improve quality indicators, reducing the SAIDI (period
of time without energy supply) in 18% in relation to 2016
(18.21h vs. 22.29h).
Enel Distribución Ceará
Enel Brasil was awarded with the public tender for the
privatization of Celg, which carried out by the Brazilian
government in November 2016 through Banco Nacional
de Desarrollo BNDES, and started operating the asset on
February 14, 2017. In May 2017, Enel Brasil acquired an
additional 5% of Celg capital (currently Enel Distribución
Goiás) for BRL$ 81.7 million. Additionally, Enel Brasil
performed a capital increase in Enel Distribución Goiás for
Enel Distribución Ceará is the electricity distribution
a total amount of BRL$1,600 million. By the end of 2017,
company that operates the State of Ceará, in northeastern
the participation of Enel Brasil in the share capital of Enel
Brazil, which covers a 148,921 km2 concession area. The
Distribución Goiás reached 99.93%.
company serves a population of over 9 million inhabitants.
139
Description of the electricity business by country The acquisition of Enel Distribución Goiás was completely
financed with funds from the capital increase of Enel
Américas, which was approved by the end of 2012.
The company is located in the central-west area of Brazil, its
concession area amounts to 337 thousand km2 and serves a
population of more than 6 million inhabitants.
Energy sales were 12,264 GWh in 2017, increasing 3.7%
over 2016. The distribution is the following: 34% residential
clients, 16% commercial clients and 50% tolls and others
(please consider that Enel Brasil started to consolidate Enel
Distribución Goiás in February 2017).
The number of clients at the close of 2017 grew to 2,928,176,
meaning a 2.4% variation compared to the close of 2016.
The classification by type of clients shows that 81% are
residential, 7% are commercial clients, and other clients
represent el 12% (please consider that Enel Brasil started to
consolidate Enel Distribución Goiás in February 2017).
Activities and projects
in distribution
Energy Efficiency
Energy efficiency projects comprise actions to promote the
conscious energy consumption and changes of equipment
(refrigerators, freezers, lamps) and electrical wiring, with
an important impact on energy consumption and home
energy efficiency improvement. In 2017, 169,755 people
in Enel Distribución Río, Enel Distribución Ceará and Enel
140
Distribución Goiás benefited with the change of equipment
initiatives. Also, 108,003 consumers were benefited from
the educational projects for conscious consumption (56,449
in conferences and workshops, 44,024 by community
agents and 7,530 by the school program). The projects are
supported by touring trucks equipped with an explanatory
model of energy generation, transmission and distribution
processes, simulators of consumption and interactive
totems with fun units for all ages. The displacement of the
project guarantees the access to information for residents
and students in zones far from metropolitan areas.
In 2017 the energy efficiency program of Enel Brasil
concentrated its initiatives in the regions with greater impact
in commercial losses (electricity theft), thus promoting
responsible energy consumption initiatives in the population,
especially among low-income consumers. The resources
invested by distribution companies are regulated and
are equivalent to 0.5% of the companies’ net operational
revenues.
Annual Report Enel Américas 2017
Colombia
Electricity Generation
Enel Américas participates in electricity generation through
its subsidiary Emgesa, where it controls, directly and
indirectly, 48.5% of its property (economic participation)
and 56.7% of political participation. Electricity generation
of Enel Américas in Colombia reached 22% of the total
generation in this market in 2017. Other generators
connected to the Colombian electricity system are:
Empresa Pública de Medellín, Isagen, Gecelca, Celsia and
Chivor.
Emgesa
the largest hydroelectric power plant in the country. Out
of the 14 existing plants, 12 power plants are hydroelectric
and two are thermal. Net generation was 14,765 GWh in
2017. Hydro generation reached 14,593 GWh and thermal
generation was 172 GWh. Sales through the energy
exchange reached 2,455 GWh.
Hydrologic Context for
Emgesa in 2017
The offer of electric energy in Colombia in 2017, presented
ENSO conditions (Oscillation of El Niño South, for its
English abbreviation)
relatively neutral, without any
incidence in the hydrologic contributions of the main rivers
in Colombia. During the first half of 2017 the contributions
at a national level (SIN) registered a surplus and in the
second half a deficit, the latter also with records below
historical average. The deficit was caused by the presence
of atmospheric phenomena that restrained rains during the
On September 1st, 2007, the Colombian companies Emgesa
second rainy season (October and November).
S.A. E.S.P. and Central Hidroeléctrica de Betania S.A. E.S.P.
completed a merger process, leaving the latter as the
Hydrological contributions of Bogotá and Quimbo river
absorbing company, which changed its name to Emgesa S.A.
basins were above historical average, while Betania river
E.S.P.
basin was normal and Guavio shown deficit in hydro
Emgesa is the largest electricity generation company
contribution.
in Colombia, and is located near the city of Bogotá. The
Thereby, the average Exchange price of the year was 106.1
company is comprised by 14 power plants with 3,509
COP$/kWh, 64% lower in relation to 2016. In this context,
MW of total installed capacity, among which El Guavio
in 2017 the variable margin of Emgesa was COP $2,255
is significant, with 1,263 MW of installed capacity, being
billion, showing a 2.9% increase from 2016.
141
Description of the electricity business by country Effective Maintenance
Management of Generation
Power Plants and Production
Management Milestones in 2017
In 2017 net energy generation was 14,765 GWh, showing
a 1.3% decrease over 2016. This mainly is the result of the
higher hydrologic contribution in 2017 in relation to 2016.
In the first semester of 2016, the National Colombian
Interconnected System –SIN– suffered the consequences
of El Niño weather phenomena; therefore in 2017 thermal
power plants weren’t required by the system. This year
the hydro power plant El Quimbo reached its higher annual
generation of 2,191 GWh since it’s commissioning in 2015.
The adequate planning and execution of preventive and
corrective maintenances guaranteed that the availability
index of the generating park in 2017 grew by 1.2% compared
to 2016, reaching 92.6%. An
important noteworthy
that were signed for one to three-year term. Total sales
reached 72.9 Mm3 and the variable margin was COL$
3,420.22 million, meaning a contribution of 0,15% to the
Company.
The market with the greater growth was the non-regulated
industrial market, which grew 191% in relation to 2016.
Nevertheless, total sales decreased due to the reduction of
spot sales and wellhead for the thermal sector, explained by
the El Niño phenomena in 2016. The supply was delivered
to 10 industrial clients (non regulated) in Bogotá, Manizales
and Cartagena, and 6 wellhead clients (secondary market).
The long-term supply of gas was ensured until 2023 in the
fields of Cusiana-Cupiagua and Clarinete 1.
Land reserved for
future projects
maintenance issue of the period was the complete
In Colombia, Enel Américas doesn’t own any land reserved
dismantling of unit 5 of El Guavio hydro power plant for the
for future projects.
maintenance over the stator winding and general overhaul,
since its start of operations 25 years ago. Likewise in the
thermal power plants the overhaul of units 4 and 5 of
Termozipa, and Cartagena 1, were completed, with the
purpose of ensuring the availability of the units.
Some of the modernization project of power plants that will
continue in 2018 are the following: change of stator winding
of units 1 of Paraíso and Guaca, modernization of the speed
regulators of unit 1 of Betania hydro power plant, of units 1
and 2 of Paraíso and of unit 3 of Guaca. In the thermal power
plant Termozipa, the service of the recollection system of dry
ashes of every unit operating simultaneously to guarantee
its environmental management was activated.
Gas Commercialization
Activities and projects
in generation
Improvements in Termozipa
Thermal Power Plant
Termozipa is a thermal power plant owned by Emgesa
located 40 km from Bogotá. This power plant has four
units and its total installed capacity amounts to 236 MW
and the coal supply comes from coal mines located in
the nearby areas. Among other things, the improvements
project comprises, among others, interventions in boilers,
In 2017 the Company continued its process of consolidation
turbines, generators and water outlets. This will allow
of the natural gas market in Colombia, obtaining the
the increase of the useful life in additional 15 years or
entrance of two new industrial clients, one in Cartagena
100,000 hours of operations. In addition, the specific heat
and the other in Mosquera (opening a new market in
rates will improve (a measure of the energy power plant
Cundinamarca). Both started consuming in December 2017.
efficiency) and will reduce the unavailability of energy.
The Company continued supplying two industrial clients
These improvements seeks to achieve high environmental
whose contracts expired in November 2017, agreements
standards with regards to gas emissions of thermal coal
142
Annual Report Enel Américas 2017 > Redesign and reposition of Medium tension networks.
> Normalization of High Tension networks.
> Modernization of essential services in AT/MT substations
> Forestry Management
> Actions plan to control and/ or mitigate the impact of the
rain and wind season.
> Protections management.
> Modernization of communications’ substation.
The results described above, show the vision of Codensa
to manage the network in order to achieve world-class
standards in terms of quality of service, under scenarios
of higher investments and operations, also implementing
Telecontrol to our network thus reaching very satisfactory
quality of service indicators for our clients.
Additionally, and continuing with the program of market
discipline, worth is mentioning the implementation of plans
focused on the control of electricity theft, thus achieving
energy losses index of 7.84% in 2017.
Electricity energy demand in the area that Codensa serves
showed a TAM decrease of 0.94%. During 2017 energy
sales were 13,790 GWh, 36% of which were sales to
residential clients, 18% commercial clients, 34% tolls and
12% industrial clients and others.
As of December 31, 2017 Codensa has installed 42,485
smart meters in the framework of the Smart Measure
Project.
power plants in Latin America, mainly focused on: Nitrogen
Oxide (NOx) emissions below 330 mg/Nm3; Sulfur Dioxide
(SO2) below 400 mg/Nm3 and particulate matter emissions
below 35 mg/Nm3. Th interventions began by the end of
2016 and are expected to be completed in 2022, including
the environmental improvements whose objective is to
reach a new emissions regime in every generation unit.
Electricity Distribution
Codensa
Codensa is the electricity distribution and commercialization
Likewise, in relation to Public Lighting, the modernization
company of Enel Américas in Colombia, serving the
project for the Public Lighting of Bogotá continued, which
complete market of Bogotá and Cundinamarca, as well as
until 2017 comprised the installation of 20,000 lights with
the thirteen districts of the neighboring Departments of
LED technology over a total of 33,000 lights considered
Meta, Tolima and Boyacá.
for the whole project. Moreover, by the end of 2017,
the Company modernized 220,000 lights with Electronic
By the end of 2017, the Company served 3,340,457 clients,
Ballast technology in different areas of the city.
and obtained important achievements and developments
in activities addressed to improve the Quality of Service,
Worth is mentioning that during 2017, Codensa continued
whose result was the improvement in the average
with the implementation of the Smart City Project in the
frequency of interruptions of our clients’ service (9.96
northwestern area of Bogotá, which will continue until
times of SAIFI -System Average Interruption Frequency
2019. Likewise, the feasibility analysis and the design of
Index-) and in the duration of the interruptions (820.37 Min
Works needed to develop the Electric Subway (elevated)
of SAIDI -System Average Interruption Duration Index-).
in Bogotá, supporting the Capital District in the concept of
The work fronts were focused on:
to implement solutions geared towards energy efficiency
> Telecontrol Project of the Network
and the development of new services to citizens.
sustainable urban development and seize the opportunity
143
Description of the electricity business by country Peru
Electricity Generation
Enel Generación Perú S.A.A.
Enel Generación Perú commercializes capacity and electric
energy in the Peruvian market, complying with all the
specifications of the Technical Norm for the Quality of
Electric Services, being tension levels, frequency and the
periods of unavailability of the service the most important
ones.
Enel Américas S.A. controls 100% of Enel Perú S.A.C.
share capital, and through the latter holds directly 83.60%
Total effective capacity amounted to 1,596 MW, (13.34%
of Enel Generación Perú and 96.5% of Enel Generación
of the total capacity of the National Electric Interconnected
Piura share capital.
System– henceforth “SEIN”), where 44% was hydro
generation and 56% thermal generation, considering
In Peru, the others generators connected to the electricity
Yanango (43 MW) and Chimay (155 MW) power plants,
system are: Electroperú, Engie Energía Perú and Kallpa
which since May 31, 2009 split off and became part of
Generación.
Chinango S.A.C.
Enel Perú S.A.C.
Enel Perú S.A.C. is a company constituted in Peru. Its social
purpose is to perform investments in other companies,
mainly in those dedicated to the exploitation of natural
resources, and specially those related to generation,
operation and commercialization of electric energy;
develop engineering for the construction of energy power
plants; carry out activities for the supply, assembly and
commissioning of equipment, facilities and/ or services
for the generation of electrical energy. Additionally, the
company may perform any other activity related to the
energy sector and waters.
Enel Generación Perú equity participation as od December
31, 2017 was the following: 83.6% belongs to Enel Perú
S.A.C. (of which Enel Américas owns 100% shareholding),
Prima AFP S.A. owns 5.9% shareholding and other
shareholders the remaining 10.5%.
The Company owns seven hydroelectric power plants, five
are located in Lima and two in Junín. Worth is mentioning
that Callahuanca hydro power plant is under reconstruction
and out of commercial operation since June 15, due to the
damages caused by the floodings that happened in March
caused by “El Niño Costero” phenomena.
144
Annual Report Enel Américas 2017 The hydroelectric power plants in Lima are located in the
The generation of Enel Generación Perú reached 6,883
Rímac River basin. Huinco Power Plant is located in Santa
GWh in 2017, 14.3% less than 2016. Energy sales totaled
Eulalia River basin, a tributary of Rímac River. Its installed
9,817 GWh as of December 2017, representing an 8.0%
capacity amounts to 268 MW and Matucana Power Plant
increase in relation to the previous year.
is located in Rímac River basin, whose installed capacity
.
is 137 MW. These rivers are diverted through tunnels and
channels to the town of Barba Blanca, where Callahuanca
La producción en Enel Generación Perú alcanzó los
Power Plant is located, whose installed capacity is 84 MW.
6.883 GWh en 2017, un 14,3% menos que el año 2016. Las
The power plants Moyopampa (69 MW) and Huampaní
ventas de energía totalizaron 9.817 GWh a diciembre de
(31 MW) are located downstream. The total capacity of
2017, un aumento de 8,0% con respecto al mismo periodo
these five power plants is 505 MW (without considering
del año anterior.
Callahuanca).
Also the Company owns 21 lagoons with installed capacity
of 282,35 hm3, which allows the regulation of the flow for
energy generation and for the water supply to the city of
Lima.
The two hydroelectric Yanango power plants are located
in the department of Junín. The installed capacity of
Yanango is 43 MW, which uses the flows of Tarma River;
and Chimay, with 155 MW installed capacity, which uses
the flows of Tulumayo River. Their total installed capacity
amounts to 198 MW. These two power plants became part
of the subsidiary Chinango, as a consequence or a simple
corporate reorganization process.
Likewise, Enel Generación Perú owns two thermal power
plants, Santa Rosa and Ventanilla, whose installed capacity
is 414 MW and 479 MW, respectively. The first is located
in the Cercado de Lima, and is comprised by UTI units
with 105 MW, TG7 of 122 MW and TG8 of 187 MW. The
second power plant is located in the Callao province,
and comprises three generation units: two gas turbines
and one steam turbine that constitute a combined cycle.
Ventanilla Thermal power plant was the first combined
cycle installed in the SEIN and currently is one of the four
combined cycles of the system.
Thermal power plants use natural gas from Camisea as
their main fuel, and the alternative fuel is diesel 2.
Enel Generación Piura S.A.
The power plant is located in the city of Talara, in the
northeast of Peru, and the administrative area operates in
Lima. Its operations are carried out within the concession
area, and according to the current legislation that allows
the development of every civil, industrial, commercial and
any other and operations related or unrelated to the main
purpose.
Generation plants are:
> Malacas Power Plant: Comprises one Siemens unit, model
SGT-800, named TG6, and was installed replacing the
Mitsubishi TG1, TG2 and TG3 units, whose commercial
operations were terminated between 2010 and 2014. On
February 25, 2017 the Coes Sinac approve the start of
commercial operation of the new unit with a total initial
installed capacity of 35 MW (due to the limitation of power
wires in 13.2 kV) and later on May 7, 2017 with an effective
capacity of 51.28 MW, after the approval of the tests of
Effective Power and Efficiency performed on March 24,
2017
> Malacas 2 Power Plant: Comprises one ABB unit, named
TGN-4, operates with natural gas in open cycle, and with
or without water injection. Nevertheless, since October 7,
2017, operated in the water injection mode only in order to
reduce NOx emissions.
> Malacas 3 Power Pant: Comprises one singe Siemens unit,
named TG-5, operates with diesel B5 fuel in open cycle in
condition of cold reserve. Worth is mentioning that, since
May 27, 2017, the Coes Sinac approved its commercial
operation with 130 MW “natural gas mode” additionally to
its operation with diesel fuel.
145
Description of the electricity business by country Production Centers
Power Plant Unit
TG-6
Malacas
TGN4
Malacas 2
Malacas 3
TG-5 RF
Total
Manufac-
turer
SIEMENS
ABB
SIEMENS
Declared
Fuel
Natural Gas
Natural Gas
Diesel B5
Effective
Capacity
(MW)
51*
106 **
190***
295
* Effective from May 7, 2017.
** Effective from July 20, 2017.
*** Effective capacity contracted with diesel, measured in the SE
Talara 220 kV, effective from May 18, 2016. Additionally, from May
27, 2017 the operation in gas mode of 130 MW was approved.
The generation of Enel Generación Piura reached 547 GWh
in 2017, 18.3% less than 2016. Energy sales totaled 640
GWh in December 2017, a 9.7% reduction in relation to the
same period in the previous year.
Land reserved for
future projects
Activities and projects
in generation
Duality TG5 C.T. Malacas
Project
TG5 is a cold reserve unit that operates with biodiesel
B5. The project takes the opportunity of using natural
gas of unit TG4 when it’s under maintenance for several
days, which was the case of the major maintenance C5
(32kEOH) programmed for 50 days. In that period, the unit
TG5 operated to comply with the required dispatch for the
national interconnected system.
The project included the provision of gas compressor and
its respective station ERM, and the costs associated to
engineering.
New unit TG6 C.T. Malacas
Project
Enel Generación Perú owns two lots with the purpose
of being used for thermal generation projects, the first is
In June 2016 started the assembly operations of the main
located in the south coast of Peru and its total area is 203
components of the new unit TG6 over its platform in its
hectares and the second is located in the central coast
definite location. These works were possible thanks to the
with a total area of 10 hectares.
coordinated effort of specialists from different locations
of the company. Nearly 50 people were involved in this
project, considering own employees and contractors.
146
Annual Report Enel Américas 2017
Unit TG6 is a dual unit, its main fuel is natural gas, which
south area of Lima. The distribution company distributes
provides greater flexibility to its operation. Likewise, it
energy to 1,396,966 clients, and benefits more than half
counts with a system called chiller, which allows the
of the inhabitants of Metropolitan Lima. At the end of 2017,
optimization of its production. It is known that gas turbines
the total accrued energy losses index was 8.2%
are very susceptible to ambient temperature changes, and
this system allows the maintenance of capacity if ambient
As of December 31, 2017, Enel Distribución Perú had
temperature increases.
1,396,966 clients, representing a 2.2% increase over 2016.
Physical sales and tolls for 2017 were 7,934 GWh, 2.0%
higher than the previous year. In monetary terms, sales
reached PEN$ 2,690 million, meaning a 1.86% decrease
Electricity Distribution
over the previous year.
Enel Américas S.A., through Enel Perú S.A.C., owns
83.18% of Enel Distribución Perú share capital.
In Peru, other distribution companies that participate in the
electricity system are: Luz del Sur, Electrosur and Grupo
Distriluz.
Enel Distribución
Perú S.A.A.
Enel Distribución Perú is the concessionary company for
electric utility that covers the north area of Metropolitan
Lima, in the Callao province and in Huaura, Huaral, Barranca
and Oyón provinces. The concession area covers a total of
1,517 km2.
The Company serves exclusively 52 districts and shares
five additional districts with the distribution company in the
Activities and projects
in distribution
In 2017, Enel Distribución Perú made investments for a total
of 405.4 million soles. Main investments were:
> Capacity expansion of the transformation substations
(SET), and transmission lines including works for the SET
Comas, Filadelfia and Malvinas.
> Expansion and reinforcement of medium and low
voltage networks.
> Capacity expansion of medium and low-tension feeders.
> Attention/ electrification of new projects for the
expansion of the grid in human settlements.
> Provision of greater safety in the facilities.
> Improvements in public lighting facilities.
> Investments in commercial losses reduction.
147
Description of the electricity business by country 17Sustainability
148
Annual Report Enel Américas 2017 149
Letter from the Chairman Sustainable Business Model
The Enel Américas’ sustainability model considers the
Its important to highlight that in Brazil, in February 2017
integration of sustainability in the value chain of the
the Company obtained control of Enel Distribución Goiás,
Company as an essential principle of the business.
the second electricity distribution company in Brazil, which
supplies energy to the State of Goias with three million
The sustainability plan of 2017 is focused on five pillars
clients, and where the network and their systems are being
that represent the cornerstones of sustainable integrated
automatized, and also digitization is being incorporated as a
development: occupational health and safety, solid
tool to improve services and coverage.
corporate governance, environmental
sustainability,
sustainable suppliers chain and
the generation of
The Company has focused its sustainability management
economic and financial value. The goals for 2017 have
in the inclusion and transparent cooperation with its
been mainly oriented to develop strong relationships with
stakeholders. Enel Américas is working in the criteria
the community, the implementation of plans focused on
and principles to promote fair relationships, in which
the people that work for the Company, especially in the
stakeholders are involved since the design of the project,
topics related to diversity and inclusion, aim for operational
ensuring the symmetry in the dialogue stages and the
efficiency, innovation and a energy matrix that integrates
access to the information required for decision-making
environmentally sustainable technologies.
process. This is carried out through the identification of
the most relevant stakeholders involved in each of the
Investment in digitization is a key issue for business
operations, and assessing the possible areas of impact and
sustainability, especially in relation to the operational
possible opportunities.
efficiency improvement of generation power plants and to
boost service offer to our clients, which we have always
Local needs are directly related to the goals of the Company
considered to be the proactive actors of the business.
through the execution of materiality matrixes specific for each
As such, during 2017 we focused on the improvement
territory, with the purpose of generating suitable projects and
of clients’ services tools through the implementation
initiatives to reach the objectives and shared priorities.
of virtual offices in Argentina, Brazil, Colombia and Peru
with the purpose of enabling customer approach and
The strong geographical presence of the company enables
the improvement of coverage and opportunities of our
it to be permanently aware of stakeholders’ requests
services.
in order to align the solutions in a consensual manner,
thus generating value for both parties. The inclusion of
In Argentina, in August 2017 the Module SFDC Emergencies
stakeholders has promoted the development of solutions
was implemented, which enables the priority treatment in
based on circular economy, for example in Argentina the
critical cases facing energy service interruption such as the
implementation of the “A Second Chance” Program,
electro-dependent clients. In Brazil micro solar generation
in which wooden coils that contain wires used for the
power plants were distributed and at the same time lamps
operation and maintenance of distribution networks
and air conditioning were exchanged to electro-dependent
were reused, and also the wooden pallets used for the
clients in order to ensure energy supply and also to help
transportation of heavy electric equipment are recycled.
those clients to reduce their electricity bills.
150
Annual Report Enel Américas 2017 Through a cooperation agreement with the NGO Vivienda
called Facilitation to Enterprises, a methodology created by
Digna Foundation, the dining room of the School Nº85 of
Ernesto Sirolli, which currently provides accompaniment
Ezpeleta of the Municipality of Quilmes (Buenos Aires)
to more than 250 people, fostering entrepreneurship and
was furnished with a total of 29 desks and 21 wooden
the creation of businesses in the region. During 2017
tables made with the coils and pallets, benefiting directly
a total of 178 businesses were created, 16 of which are
the 280 students that daily have lunch in the school dining
already financially sustainable and are generating revenues
room. In Brazil, low-income communities received support
and jobs. Among these businesses, noteworthy are the
through recycling projects for entrepreneurs, with the
following: production and sale of arepas, sound effects
transformation of waste materials creating formal jobs that
for events, fabrication of backpacks and accessories,
increase the household income. In Peru, the floodings that
production and commercialization of pastries, accounting
took place at the beginning of 2017 caused by the “El Niño
consultancies, and the development of two new thematic
Costero” phenomenon, destroyed houses, large farming
restaurants in the region.
areas and irrigation infrastructure. Given this situation,
the initiative Enel for Perú was born, which is a solidarity
It’s worth mentioning the acquisition of Volta Grande,
and voluntary activity of every Enel employee worldwide
hydroelectric generation company with which
the
and Enel Cuore, which contributed economically for the
renewable energy generation of Enel in Brazil will increase
recovery of Callahuanca district through the development
in 42%. The process of approaching the neighboring
of a project that consisted on the recovery of the main
communities is beginning, whose purpose is to understand
agricultural crops of the area, creating jobs and economic
the scope and influence of the power plant.
growth.
In Colombia, with the purpose of promoting development
Open Power vision, in its commitment with the fulfillment
and economic growth in the area of El Quimbo hydroelectric
of United Nations’ Sustainable Development Goals, the
power plant direct influence, we implemented a strategy
Creation of Shared Value and compliance with its Human
The business culture of Enel Américas is focused on the
Rights Policy.
Sustainability
151
Open Power
Vision
The following chart shows the distribution by country in
Enel Américas:
Enel Américas established the “Openness” concept in the
center of its business, being the cornerstone of its strategic
and operational approach: open energy to a larger number
44%
of people; open energy to new technologies; provide new
energy management methods for the consumer; open de
possibility of new uses of energy; and open to a greater
number of collaborators.
3%
5%
Beneficiaries in 2017
Colombia
Brazil
Peru
Argentina
49%
3%
5%
Beneficiaries in 2017
Colombia
3% 2%
2. Affordable Energy (ODS 7): Give access to affordable,
sustainable and clean energy through the Enabling
Electricity initiative, which will benefit three million people,
44%
21%
Argentina
Brazil
49%
Beneficiaries in 2017
Peru
Brazil
mainly in Africa, Asia and Latin America in 2020. During
Colombia
2017, Enel Américas reached 454,880 people and the
74%
Peru
distribution by country is shown below:
Argentina
3% 2%
21%
5%
6%
19%
5%
6%
19%
Beneficiaries in 2017
Brazil
Colombia
74%
Beneficiaries in 2017
Peru
71%
71%
Argentina
Brazil
Peru
Colombia
Argentina
Beneficiaries in 2017
Brazil
Peru
Colombia
Argentina
Objectives of sustainable
development
As of 2015 the United Nations adopted the new
Sustainable Development Goals (ODS), through them
these organization called companies to promote the use of
creativity and innovation to address the 17 great challenges
of sustainable development, such as poverty, gender
equality, access to water and clean energies and climatic
change, among others.
In this occasion, Enel SpA (“Enel”) announced the Group’s
commitment to contribute the achievement of four out
of the seventeen objectives. Particularly, Enel and its
companies worldwide have been focused on the following
objectives:
1. Quality Education (ODS 4): Support educational activities
for 400,000 people by 2020 through projects similar to
the ones in execution, such as the scholarship programs
in Latin America. During 2017, Enel Américas reached
188,479 beneficiaries, meanwhile the Group already
reached the goal of 400,000 beneficiaries, thus duplicating
the objective for 2020.
152
Annual Report Enel Américas 2017 3%
5%
44%
49%
Beneficiaries in 2017
Colombia
Brazil
Peru
Argentina
3% 2%
21%
Beneficiaries in 2017
Brazil
Colombia
74%
Peru
3. Decent Work and Economic Growth (ODS 8): Foster
Argentina
job creation and sustained economic growth, inclusive
and sustainable for 500,000 people. During 2017, Enel
Américas reached 98,095 people and the distribution by
country is shown below:
5%
6%
19%
Beneficiaries in 2017
71%
Brazil
Peru
Colombia
Argentina
4. Action for the Climate (ODS 13): Take initiatives to
combat climate change, with the objective of achieving
carbon neutrality in 2050.
Human Rights Policy
Enel Américas has developed a Human Rights Policy as
a demonstration of its commitment and responsibility in
this key area for social and corporate sustainability. The
document gathers the commitment and responsibilities
of the Company in relation to every human right, and
especially to the ones that impact the business activity and
operations developed by the company’s employees in the
countries where it operates
Under this regulatory framework, the Company performed
in 2017 a Due Diligence process in the Human Rights
field in the four countries where it operates, in order to
identify those risk situations, prevent them and carry out a
process of socialization of results for stakeholders. In 2018
and 2019 an action plan defined for each country will be
implemented with every area of the company including the
definition of actions to solve the identified gaps.
Sustainability
153
18Schematic Table of Ownership
154
Annual Report Enel Américas 2017 155
Letter from the Chairman 156
Annual Report Enel Américas 2017 Direct and Indirect Economic
Participations
Argentina
Enel Generación Costanera S.A.
Enel Generación El Chocón S.A
Central Dock Sud. S.A.
Edesur S.A.
Compañía de Transmisión del Mercosur S.A.
Transportadora de Energía S.A.
Enel Trading Argentina S.R.L.
Yacylec
Termoeléctrica José de San Martin
Termoeléctrica Manuel Belgrano
Central de Vuelta Obligado S.A.
Brazil
Enel Brasil S.A.
Central Generadora Termoeléctrica Fortaleza S.A.
EGP Cachoeira Dourada S.A.
Enel Distribución Río S.A.
Enel Distribución Ceará S.A.
Enel Cien S.A.
Enel Green Power Proyectos I S.A (Volta Grande)
Colombia
Emgesa S.A. E.S.P.
Codensa S.A.
Peru
Enel Generación Perú
Enel Distribución Perú S.A
Compañía Energética Veracruz
Enel Generación Piura
Chinango S.A.C
Gx: Generation
Dx: Distribution
Tx: Transmission / Commercialization
Ox: Gas Pipelines, others
Business
Ownership
Gx
Gx
Gx
Dx
Tx
Tx
Tx
Tx
Gx
Gx
Gx
Business
Gx. Dx. Tx
Gx
Gx
Dx
Dx
Tx
Gx
75.59%
65.68%
40.25%
72.07%
99.62%
99.62%
99.95%
22.22%
16.98%
16.98%
25.36%
Ownership
99.62%
99.62%
99.37%
99.26%
73.77%
99.62%
99.62%
Business
Ownership
Gx
Dx
48.48%
48.30%
Business
Ownership
Gx
Dx
Gx
Gx
Gx
83.60%
83.18%
100%
96.50%
66.88%
Schematic Table of Ownership
157
Perimeter of Enel Américas’
Corporate Shareholdings
ENEL
AMÉRICAS S.A.
48.481619%
Emgesa S.A
94.95%
Sociedad Portuaria
Central
Cartagena S.A.
4.90%
Inversora
Codensa S.A.S.
100%
48.3026%
Codensa S.A.
22.22%
Yacilec S.A.
0.2509%
Central
Dock Sud S.A.
69.9925%
57.1417%
Inversora
Dock Sud S.A.
ENEL
Generación
Costanera S.A.
75.6813%
1.42%
Termoeléctrica
Manuel
Belgrano S.A.
5.326%
1.42%
Termoeléctrica
José de
San Martín S.A.
6.40%
Central Vuelta de
Obligado S.A.
5.326%
1.3%
18.85%
18.85%
33.2%
8.6741%
ENEL
Generación El
Chocón S.A.
59.00%
41.9411%
Hidroinvest S.A
54.7571%
Chile
Argentina
Brazil
Peru
Colombia
158
GasAtacama
Chile S.A.
0.1153%
99.8847%
ENEL
Argentina S.A.
45%
ENEL Trading
55%
Argentina S.R.L.
Distrilec
Inversora S.A.
51.50%
100%
ENEL Perú
S.A.C.
ENEL
Generación
Perú S.A.
83.59701%
83.184%
96.50%
ENEL
Distribución
Perú S.A.
ENEL
Generación
Piura S.A.
100%
Compañía
Energética
Veracruz S.A.C.
80%
Chinango
S.A.C.
2.32856%
56.3577%
Edesur S.A.
43.0971%
50%
SACME S.A.
97.67143%
ENEL
Brasil S.A.
99.93%
Enel Distribución
Goiás S.A.
1.00%
INGENDESA DO
BRASIL LTDA.
ENEL
Distribución
Ceará S.A.
74.051061%
99.636997%
EGP Cachoeira
Dourada S.A.
99.754055%
100%
ENEL
Distribución
Río S.A.
ENEL
Generación
Fortaleza S.A.
TESA S.A.
99.999%
0.001%
CTM S.A.
99.999993%
ENEL CIEN
S.A.
100%
99.9999%
ENEL
Soluciones S.A.
100%
EGP Projetos I
(Volta Grande)
Annual Report Enel Américas 2017
ENEL
AMÉRICAS S.A.
48.481619%
Emgesa S.A
94.95%
Sociedad Portuaria
4.90%
Central
Cartagena S.A.
Inversora
Codensa S.A.S.
100%
48.3026%
Codensa S.A.
ENEL
Generación
Costanera S.A.
75.6813%
1.42%
Termoeléctrica
Manuel
Belgrano S.A.
5.326%
1.42%
Termoeléctrica
José de
San Martín S.A.
5.326%
1.3%
6.40%
Central Vuelta de
Obligado S.A.
18.85%
18.85%
33.2%
ENEL
8.6741%
Generación El
Chocón S.A.
59.00%
41.9411%
Hidroinvest S.A
54.7571%
22.22%
Yacilec S.A.
0.2509%
Central
Dock Sud S.A.
69.9925%
57.1417%
Inversora
Dock Sud S.A.
Chile
Argentina
Brazil
Peru
Colombia
GasAtacama
Chile S.A.
0.1153%
99.8847%
ENEL
Argentina S.A.
45%
ENEL Trading
Argentina S.R.L.
55%
Distrilec
Inversora S.A.
51.50%
100%
ENEL Perú
S.A.C.
ENEL
Generación
Perú S.A.
83.59701%
83.184%
96.50%
ENEL
Distribución
Perú S.A.
ENEL
Generación
Piura S.A.
100%
Compañía
Energética
Veracruz S.A.C.
80%
Chinango
S.A.C.
2.32856%
56.3577%
Edesur S.A.
43.0971%
50%
SACME S.A.
97.67143%
ENEL
Brasil S.A.
99.93%
Enel Distribución
Goiás S.A.
1.00%
INGENDESA DO
BRASIL LTDA.
ENEL
Distribución
Ceará S.A.
74.051061%
99.636997%
EGP Cachoeira
Dourada S.A.
99.754055%
100%
ENEL
Distribución
Río S.A.
ENEL
Generación
Fortaleza S.A.
TESA S.A.
99.999%
0.001%
CTM S.A.
99.999993%
ENEL CIEN
S.A.
100%
99.9999%
ENEL
Soluciones S.A.
100%
EGP Projetos I
(Volta Grande)
Schematic Table of Ownership
159
19Significant Events of the Company
160
Annual Report Enel Américas 2017 161
Letter from the Chairman 2017
Significant Events
In accordance with articles 9 and 10, paragraph 2, under Securities Market Law N°18,045, and as established under
General Norm No. 30 of the Superintendence, the following significant events were informed:
> On January 11, 2017, the following significant event was
(ANEEL) have granted the appropriate authorizations.
informed:
Consequently, the sale contract of approximately 94.8%
equity of Celg Distribuição S.A. has been signed for a
Pursuant to the provisions of Resolution No. 660 of
total of BRL$ 2,187 million (equivalent to approximately
1986, of this Superintendence, a rectification of Form
US$ 640 million).
No.1 contained in the aforementioned resolution was
sent through the SEIL Module on November 24, 2016
The purchase of CELG was financed with resources
by Enersis Américas, today Enel Américas S.A. (“Enel
raised in the Enel Américas capital increase approved at
Américas” or the “Company”), in order to communicate
the end of 2012. This acquisition increases the customers
the distribution of an interim dividend, to be charged
of Enel Brasil from a base of 7 to 10 million, which rises
against the financial result of 2016, corresponding to
the number of the Enel Group’ customers at a Global
15% of net income reported on September 20, 2016,and
level to approximately 65 million.
to be paid from January 27, 2017.
> On April 27, 2017, the following significant event was
> On February 14, 2017, the following significant event was
informed:
informed:
In accordance with articles 9 and 10 under Securities
Chilean Securities Market Law No. 18,045, and as
Market Law No. 18,045, and as established under
established under Chilean General Norm No. 30 of the
General Norm No. 30 of the Superintendence, Enel
Superintendence, Enel Américas informs the following
Américas S.A. informs the following significant event:
significant event:
In accordance with articles 9 and 10, paragraph 2 under
With regards to our subsidiary Enel Brasil, awarded the
The Ordinary Shareholders’ Meeting of Enel
public tender offer organized by the Brazilian Government
Américas S.A. held today has agreed to distribute
through Banco Nacional do Desenvolvimento (BNDES)
the minimum mandatory dividend (from which the
for the acquisition of the 94.8% shareholding of the
interim dividend paid
in January 2017 has been
electricity distribution company Celg Distribuição S.A.,
deducted) as well an additional dividend that amounts
which operates in the Brazilian State of Goias, informs
to Ch$191,529,766,769 equivalent to Ch$ 3.33370 per
through the significant event N° 83/2016 of November 30,
share.
2016, the final closure of the operation has taken place
since the antitrust authorities, Conselho Administrativo
Given that the abovementioned interim dividend has
de Defensa Econômica
(CADE) and
the sector
already been paid, the distribution and payment of the
regulator Agência Antimonopólica de Energia Eléctrica
remaining portion of the final dividend No. 95 will be for
a total of Ch$137,142,515,165, or Ch$2.38705 per share.
162
Annual Report Enel Américas 2017
As set forth in Circular Letter No. 660 of 1986, the two
under General Norm No. 30 of the Superintendence,
forms related to the aforementioned final dividend were
Enel Américas informs of the following significant
submitted to the SVS.
event: the Board of Directors of Enel Américas S.A., in
a session held on June 28, 2017, and in accordance with
> On April 28, 2017, the following significant event was
article 147 of the Chilean Companies Act Law 18,046,
informed:
decided to introduce certain modifications to its Related-
party transaction policy and has approved a revised text
In accordance with articles 9 and 10, paragraph 2 under
of said policy as follows:
Chilean Securities Market Law No. 18,045, and as
established under Chilean General Norm No. 30 of the
1.- Financial transactions with related parties and which
Superintendence, Enel Américas informs the following
under the name of a commercial current account and/
significant event:
or financial loans are entered into in order to optimize
the cash management of the respective companies are
The Extraordinary Shareholders’ Meeting of Enel
considered habitual.
Américas S.A. (“Enel Américas” or the “Company”)
held on April 27, 2017, has adopted, amongst others, the
2. Transactions of a financial nature or of financial
following agreements:
intermediation that the Company normally carries out
with related parties consisting of banking entities or
1. The cancellation of
treasury shares acquired
in
subsidiaries of such banking entities, such as fixed or
the context of the merger of Endesa Américas
variable income financial investments, the purchase
and Chilectra Américas into Enel Américas as of
and sale of foreign currencies, financial derivatives,
December 1, 2016 and
the subsequent capital
“swaps”, repurchase agreement (repo), term deposits,
decrease from Ch$ 4,621,809,178,631 Chilean pesos
overdraft facilities, promissory note loans, letters of
divided
into 58,324,975,387 common
registered
credit, performance bonds, “stand-by letters of credit”,
shares, all of the same series and with no par value
“forwards” contracts, exchange rate hedge, options and
to Ch$ 4,527,762,465,556 Chilean pesos, divided into
futures, operations related to the Company’s current
57,452,641,516 common registered shares, all of the
accounts or other habitual financial operations carried
same series and with no par value.
out by the Treasury Department of Enel Américas S.A.
2. The change of the functional currency of Enel Américas
are considered habitual.
S.A. from Chilean pesos to United States dollars, thereby
3. Transactions with related parties related to IT services,
modifying permanent Article Five of its bylaws in order
infrastructure services, “data center”, micro-informatics,
to denominate the Company’s capital in that currency,
“software” and “hardware” and
in general data
thus establishing that the Company’s capital is now
management.
6,763,204,424 U.S. dollars divided into 57,452,641,516
common shares, all of the same series and with no
4. Transactions with related parties related to financial
par value which, pursuant to transitory Article 1 of
management, management services and other
these bylaws, and as agreed by the Extraordinary
similar ones, consisting, among others, of accounting,
Shareholders’ Meeting, are fully subscribed and paid.
financial reporting, fixed assets, purchase and sale
ledgers, treasury and banks, taxation advisory services,
> On June 29, 2017, the following significant event was
insurance, procurement, controllership and
internal
informed:
audit.
In accordance with articles 9 and 10, paragraph 2 under
5. Shareholding or capital acquisition or sale transactions
Securities Market Law No. 18,045, and as established
of the Company’ subsidiaries or affiliates or, in general,
Significant Events of the Company
163
companies in which the Company has a direct or indirect
signing and closure of the operations is expected to take
participation held with related companies, in order to
place on November 30, 2017.
proceed to corporate or asset restructuring, and which
do not exceed 5% of the company’s capital share in
Management shall explain the tender process in more
relation to which the transaction is taking place.
detail in a “conference call” which shall take place on
September 29, 2017 at 12.30 hours, Santiago, Chile
> On September 21, 2017, the following significant event
time.
was informed:
> On October 4, 2017, the following significant event was
In accordance with articles 9 and 10, paragraph 2 under
informed:
Securities Market Law No. 18,045, and as established
under General Norm No. 30 of the Superintendence,
In accordance with articles 9 and 10, paragraph 2 under
Enel Américas informs of the following significant
Securities Market Law No. 18,045, and as established
event: On September 21, 2017, Enel Américas S.A.
under General Norm No. 30 of the Superintendence,
paid BRL$ 389,575,000, equivalent to US$ 125 million,
Enel Américas informs of the following significant event:
in cash in relation to the capital increase in its Brazilian
subsidiary Enel Brasil S.A. . After the capital increase,
Today the Peruvian subsidiary Enel Perú S.A.C., fully
the participation of Enel Américas S.A. in Enel Brasil S.A.
owned by Enel Américas S.A. has acquired 47,686,651
increased to 95.44% from 95.25%.
shares
issued by
the Peruvian Subsidiary Enel
Distribucion Perú S.A.A., equivalent to 7.5% of the
This operation is part of the use of process raised in the
last company. Taking into consideration this purchase,
capital increase of Enersis S.A., currently Enel Américas
Enel Américas has increased its direct and indirect
S.A., approved by the Extraordinary Shareholders’
shareholding through the subsidiary Enel Perú to 83.2%
Meeting held on December 20, 2012 that satisfactorily
of the property of Enel Distribucion Perú. The referred
ended with 100% of the shares available subscribed in
to transaction has totaled 262,276,580 Peruvian soles
March, 2013, collecting Ch$1,121,458 in cash.
(approximately equivalent to US$ 80 million) and it took
> On September 27, 2017, the following significant event
was informed:
place on the trading floor of the Lima Stock Exchange.
Considering that Enel Américas S.A. already controlled
and, therefore, consolidated Enel Perú S.A.C. and Enel
In accordance with articles 9 and 10, paragraph 2 under
Distribucion S.A.A., said operation does not lead to any
Securities Market Law No. 18,045, and as established
effects in the Comprehensive Income Statements of Enel
under General Norm No. 30 of the Superintendence,
Américas and does not modify the assets and liabilities of
Enel Américas informs of the following significant event:
said subsidiaries registered in the Consolidated Balance
that our subsidiary Enel Brasil S.A. has presented the
Sheet of Enel Américas S.A. The effects of this higher
best financial offer for the subscription of the concession
stock ownership on part of Enel Américas S.A. shall be
for hydroelectric generation for 30 years corresponding
reflected in the Income Statement of the controlling
to the Volta Grande facility with a 380 MW installed
company.
capacity, located in the State of Mina Gerais, Brazil.
The financial offer amounts to BRL$ 1,419,783,357
interests buyout included in the Company’s Strategic
which is equivalent to US$ 445 million.
Plan.
This transaction is fully in line with the policy of minority
It is expected that the announcement of the final result
> On November 30, 2017, the following significant event
of the tender should be made on October 7, 2017. The
was informed:
164
Annual Report Enel Américas 2017
In accordance with articles 9 and 10 under Securities
Taking into consideration that the contents of the referred
Market Law N°18,045, and as established under General
Strategic Plan follow and are based on projections and
Norm N° 30 of the Superintendence, Enel Américas
hypotheses that might or might not come true in the
informs of the following significant event: as of this date
future, its effects cannot be established at this date.
Enel Brasil has made a payment through an investment
vehicle created for such purposes of BRL$ 1,419,784,000
> On November 30, 2017, the following significant event
(approximately US$ 445 million), for the acquisition
was informed:
of the concession of Central Hidrogeneradora Volta
Grande, located in the State of Minas Gerais, Brazil.
In accordance with articles 9 and 10, under Securities
For that purpose, on November 27, 2017, Enel Americas
Market Law N°18,045, and as established under General
subscribed and paid a cash capital increase in Enel Brasil
Norm No. 30 of the Superintendence, Enel Américas
of BRL$ 568 million (approximately US$ 178 million)
S.A. informs of the following significant event: in session
under the terms approved by its Board of Directors in its
held on November 29, 2017, the Board of Directors of
session held on October 26, 2017.
Enel Américas S.A., unanimously agreed to distribute
an interim dividend of US$ 0.00100 per share on
With the completion of the aforementioned operation,
January 26, 2018, attributable to the 2017 fiscal period,
the proceeds of the capital increase are fully invested
corresponding to 15% of net income as of September
as approved by the Company’s Extraordinary Meeting
30, 2017, in accordance with the Company’s dividend
of Shareholders known formerly as Enersis S.A. held on
policy.
December 20, 2012.
> On November 30, 2017, the following significant event
pesos, the legal currency, converted according to the
was informed:
Observed Dollar exchange rate published in the Official
The aforementioned dividend will be paid in Chilean
Gazette on January 19, 2018.
In accordance with articles 9 and 10 under Securities
Market Law N°18,045, and as established under General
Norm N° 30 of the Superintendence, Enel Américas S.A.
informs of the following significant event: yesterday,
the Board of Directors of Enel Américas, has approved
the Strategic Plan of Enel Américas for the period of
2018-2020. A copy of the aforementioned Strategic Plan
can be obtained from the Company’s website at www.
enelamericas.com.
Significant Events of the Company
165
20Identification of subsidiaries and
associate companies
166
Annual Report Enel Américas 2017 167
Letter from the Chairman CENTRAL DOCK SUD S.A.
Company Name
Central Dock Sud S.A.
Type of Company
Limited Liability Company
Address
Avenida Debenedetti 1636
Dock Sud Avellaneda
Phone
4229-1000
Subscribed and paid-in capital (US$
thousand)
57,566.11
Corporate purpose
The corporate purpose of the company is the
generation of electricity and its block sale. The
company may carry out any supplementary
and subsidiary activities linked to its corporate
purpose, having to that effect full legal capacity
to acquire rights and commit obligations and
execute all acts not forbidden by law, by these
By-laws, the Document of the International
Public Tender for the Sale of Central Dock Sud
S.A’s Shares, or by any applicable regulation.
Core business
Electricity generation
Regular Directors
Hector Martin Mandarano (Chairman)
Santiago Matías Sajaroff (Vice Chairman)
Paolo Pescarmona
Antonio Ascione
Mauricio Bezzeccheri
Mónica Analía Ciacciarelli
Andrea Biasotto
Rodolfo Eduardo Berisso
Paula Maria Garcia Kedinger
Alternate Directors
(Enel’s vacant position)
Mónica Diskin
Gaetano Salierno
María Eugenia Pardo
Patricio Cipollone
María Victoria Ramírez
Raul Angel Rodriguez
Julian Matias Ferreiro
Daniel Gustavo Ciaffone
Senior Management
Gustavo Diego Manifesto
General Manager
Alejandro Serantes
Finance Manager
Julio Temen
Commercial Manager
David Garcia Albalá
Operations Manager
Graciela Babini
Planning and Control Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
168
CENTRAL VUELTA
OBLIGADO S.A.
Company Name
Central Vuelta Obligado S.A.
Type of Company
Limited Liability Company
Address
Av. Thomas Edison 2701
Buenos Aires, Argentina
Phone
(5411) 5533 0200
Subscribed and paid-in capital (US$
thousand)
31.47
Corporate purpose
Generation of electricity and its
commercialization by blocks and particularly,
equipment purchasing management,
construction, operation and maintenance of a
thermal power plant named Vuelta Obligado
complying with “Management and Operation
of Projects, Increase of Thermal Generation
Availability and Generation Compensation
Adaptation 2008-2011 Agreement” agreed
upon November 25, 2010 by the National
State and the signing generation companies.
Core business
Construction of a thermal power plant called
Central Vuelta de Obligado.
Regular Directors
Leonardo Pablo Katz (Chairman)
Adrián Gustavo Salvatore (Vice Chairman)
Andrea Biasotto
Mónica Diskin
Alternate Directors
Leonardo Marinaro
Ignacio Villamil
Antonino Ascione
Senior Management
Leonardo Pablo Katz
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
CHINANGO S.A.C.
Company Name
Chinango S.A.C.
Type of Company
Limited Liability Company
Address
Calle César López Rojas N° 201, Urb.
Maranga, San Miguel
Lima, Peru
Subscribed and paid-in capital (US$
thousand)
82,236.89
Corporate purpose
Electricity generation, trading and
transmission, being able to perform all acts
and to engage all contracts that the Peruvian
law allows for such purposes.
Core business
Electricity generation
Gerente General
Enel Generación Perú S.A.A., represented by
Eugenio Calderón López
Business Relations
The company has no commercial relation
with Enel Américas S.A.
CODENSA
Company Name
CODENSA S.A. E.S.P.
NIT:
830,037,248-0
Type of Company
Limited Liability Company– Public residential
utility company.
Address
Carrera 13 A No. 93-66
Bogotá D.C, Colombia
Phone
(57 1) 601 6060
Subscribed and paid-in capital (Thousand
USD)
4,518.09
Corporate purpose
The company’s main purpose is the
distribution and sale of electricity, as well as
all similar, connected, complementary and
related activities with respect to electricity
distribution and sale; the execution of
electrical engineering works, design and
consultancy, and sale of products for the
benefit of its customers. The society may
also perform other activities related to the
provision of public services in general,
Annual Report Enel Américas 2017 manage and operate other utility companies,
sign and execute special management
agreements with other utility companies
and sell or loan goods or services to other
economic agents related with utilities, in
or out of the country. The society may also
participate as partner or shareholder in other
utility companies, directly, or joining into
partnerships with other persons, or in joint
venture with them.
Core business
Electricity distribution and commercialization.
Regular Directors
David Felipe Acosta Correa
Jose Antonio Vargas Lleras
Lucio Rubio Diaz
Gloria Astrid Álvarez Hernandez
Felipe Castilla Canales
José Franco Reyes
Andrés López Valderrama
Diretores suplentes
Carlos Mario Restrepo
Leonardo Lopez Vergara
Juan Manuel Pardo Gomez
Ernesto Moreno Restrepo
Eduardo Jose Bernardo Aguirre Monroy
Ivan Darío Gomez Castaño
Vicente Enrique Noero Arango
Senior Management
David Felipe Acosta Correa
General Manager
David Felipe Acosta
Infrastructure & Networks Manager
Andres Caldas Rico
Legal and Corporate Affairs Manager
Carlos Mario Restrepo
Market Manager
Daniele Caprini
Administration, Finance and Control Manager
Maria Celina Restrepo Santa Maria
Communications Manager
Rafael Carbonell Blanco
Human Resources and Organization Manager
Diana Marcela Jimenez
Regulation and Institutional Relations
Manager
Eugenio Belinchon
Audit Manager
Raúl Fernando Vacca Ramírez
Procurement Manager
Ana Patricia Delgado Meza
Systems and Telecommunications ICT
Manager
Ana Lucia Moreno Moreno
General Services and Safety Manager
Carlo Ferrara
Sustainability Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
COMPAÑÍA
ENERGÉTICA
VERACRUZ S.A.C.
Company Name
Compañía Energética Veracruz S.A.C.
Type of Company
Limited Liability Company
Address
Calle César López Rojas N° 201, Urb.
Maranga, San Miguel
Lima, Peru
Subscribed and paid-in capital (US$
thousand)
890.82
Corporate purpose
Develop and operate hydroelectric projects
located in any river basin in Peru.
Core business
Owner of Veracruz hydroelectric project.
General Manager
Jean Philippe Salvatore Bellavia
Business Relations
The company has no commercial relations
with Enel Américas S.A.
CTM
Compañía de
Transmisión del
Mercosur S.A.
Company Name
Compañía de Transmisión del Mercosur S.A.
Type of Company
Publicly traded company constituted in
Buenos Aires, Argentina
Address
Bartolomé Mitre 797, 11th Floor, Buenos
Aires, Argentina
Subscribed and paid-in capital (US$
thousand)
5.23
Corporate purpose
The provision of high tension electricity
transmission services, in the case of linking
both national and international electrical
systems, according to current laws, to
the purpose of which it may participate in
national or international tenders, become
a high tension electricity transmission
concessionaire, locally or abroad, and
perform those activities deemed necessary
to carry out its purposes.
Core business
International interconnected electricity
transmission.
Regular Directors
Juan Carlos Blanco (Chairman)
Paolo Giovanni Pescarmona (Vice Chairman)
Mónica Diskin
Alternate Directors
Gaetano Salierno
Nagelo Cefalu
Senior Management
Sandro Ariel Rollan
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
DISTRILEC
INVERSORA S.A.
Company Name
Distrilec Inversora S.A.
Type of Company
Limited Liability Company
Address
San José 140
Buenos Aires, Argentina
Phone
(54 11) 4370 3700
Subscribed and paid-in capital (US$
thousand)
26,438
Corporate purpose
Exclusively to invest in companies
constituted or to be constituted whose main
activity is the distribution of electricity or that
directly or indirectly participate in companies
with that principal business through all kind
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.
Core business
Investment Company.
Regular Directors
Maurizio Bezzecheri
Paolo Giovanni Pescarmona (Vice Chairman)
Mónica Diskin
Juan Carlos Blanco
Gonzalo Peres Moore
Mariano Luis Luchetti
Guillermo Pablo Reca
Jorge Carlos Bledel
Juan Carlos Casas
169
Identification of Subsidiaries and Associate Companies Alternate Directors
María Inés Justo
Gaetano Salierno
Marcello Coffaro
Angelo Cefalu
Janeth Cabrera Brambilla
Adrián Salvatore
Leonardo Marinaro
José Manuel Pasos
Rubén López
Rubén Vázquez
Business Relations
The company has no commercial relations
with Enel Américas S.A.
EDESUR
Company Name
Empresa Distribuidora Sur S.A.
Type of Company
Sociedad Anónima
Address
San José 140 (1076)
Capital Federal, Argentina
Phone
(54 11) 4370 3700
Subscribed and paid-in capital (US$
thousand)
44,904
Corporate purpose
Distribution and commercialization of
electricity and related activities.
Core business
Electricity distribution.
Regular Directors
Juan Carlos Blanco (Chairman)
Paolo Giovanni Pescarmona (Vice Chairman)
Monico Hodor
Gonzalo Peres Moore
Guillermo P. Reca
Paula Aguiar
Ernesto Pablo Badaraco
Gerardo Marcelo Silva Iribarne
Mónica Diskin
Alternate Directors
Gaetano Salierno
María Victoria Ramirez
Marcello Coffaro
Rubén Vazquez
Rubén Omar Lopez
Angelo Cefalu
Janeth Cabrera Brambilla
María Inés Justo
Senior Management
Jiuiseppe Fanizzi
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
170
ELÉCTRICA CABO
BLANCO S.A.C. *
Company Name
Eléctrica Cabo Blanco S.A.C.
Type of Company
Limited Liability Company
Address
Calle César López Rojas 201, Urb. Maranga,
San Miguel
Lima, Peru
Corporate purpose
In general, to invest in other companies,
preferably in those oriented to exploiting
natural resources, and very specially, in
those linked to distribution, transmission and
generation of electricity. Likewise, it may make
capital investments in any kind of movable
property, including shares, bonds and any other
kind of securities, as well as administration
of said investments within limits fixed by the
Board and the General Shareholders’ Meeting.
The activities that make up the corporate
purpose may be developed in Peru and abroad.
*Company absorbed by Enel Perú S.A.C as
of April 28, 2017.
EMGESA
Company Name
Emgesa S.A. E.S.P.
NIT
860,063,875-8
Type of Company
Private Commercial Corporation.
Public Utility Company
Address
Carrera 11 N°82-76, 4th Floor
Bogotá, D.C. Colombia
Alternate Directors
General Manager
Bruno Riga
Renewables Energies Manager
Marcelo Falcuchi
Thermal Generation Manager
Andres Caldas Rico
Legal and Corporte Affairs Manager
Fernando Javier Gutierrez Medina
Energy Trading Manager
Daniele Caprini
Administration, Finance and Control Manager
Maria Celina Restrepo Santamaría
Communications Manager
Rafael Carbonell Blanco
Human Resources and Organization Manager
Diana Marcela Jimenez Rodriguez
Regulation and Institutional Relations
Manager
Eugenio Belinchon
Audit Manager
Raúl Fernando Vacca Ramírez
Procurement Manager
Ana Patricia Delgado Meza
Systems and Telecommunications ICT
Manager
Ana Lucia Moreno Moreno
General Services and Safety Manager
Carlo Ferrara
Sustainability Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
EMGESA PANAMÁ, S.A. *
Company Name
Emgesa Panamá, S.A.
Type of Company
Limited Liability Company, not listed and it’s
not a securities issuer.
Address
City of Panama, Panama
Subscribed and paid-in capital (US$
thousand)
219,487.83
Corporate purpose
The corporate purpose of the company is
generation and sale of electricity and sale
of fuel gas, as well as all activities similar,
connected, supplementary and related to its
main purpose.
Corporate purpose
Purchase, sale, import and export of
electricity. Additionally, the company may
perform other industrial and commercial
activities in general; it is able to celebrate all
transactions, operations, business, events
and activities that are permitted by the
Panamanian law to corporations even if they
are not expressly mentioned in this corporate
purpose.
Core business
Electricity and fuel gas generation and
commercialization.
Core business
Purchase, sale, import and export of
electricity.
Regular Directors
Bruno Riga
Lucio Rubio Diaz
Jose Antonio Vargas Lleras
Gloria Astrid Álvarez Hernandez
Luisa Fernanda Lafaurie Rivera
Diana Margarita Vivas Munar
Luis Fernando Alarcón Mantilla
Directores
Fernando Gutierrez Medina
Leonardo Lopez Vergara
Juan Manuel Pardo
Andres Caldas Rico
Senior Management
Fernando Gutierrez Medina
Annual Report Enel Américas 2017 ENEL ARGENTINA S.A.
Phone
(21) 2716-1138
Presidente y Representante Legal
Juan Manuel Pardo Gomez
Vice Chairman (First)
Leonardo Lopez Vergara (Second)
Vice Chairman
Business Relations
The company has no commercial relations
with Enel Américas S.A.
*The early dissolution of Emgesa Panamá
S.A. was agreed at the Extraordinary
Shareholders’ Meeting of the company held
on May 30, 2017.
Company Name
Enel Argentina S.A.
Type of Company
Publicly Traded Company
Address
Av. España 3301
Buenos Aires, Argentina
Phone
(5411) 4307 3040
Subscribed and paid-in capital (US$
thousand)
120,171.21
Corporate purpose
Carry out investments in companies
dedicated to the production, transmission
and distribution of electricity and its
commercialization, as well as financial
activities except those limited by the law to
banks.
Core business
Investment Company.
Regular Directors
Mauricio Bezzeccheri (Chairman)
Paolo Giovanni Pescarmona (Vice Chairman)
Mónica Diskin
Alternate Directors
Gaetano Salierno
María Victoria Ramírez
ENEL BRASIL
INVESTIMENTOS
SUDESTE S.A
Company Name
Enel Brasil Investimentos Sudeste S.A
companies in that sector, in Brazil or abroad;
transmission, distribution, generation or
commercialization of electricity and related
activities and participation, individually or
through joint ventures, consortia or other
similar forms of association, in tenders,
projects and enterprises for the supply of
services and activities previously mentioned.
Type of Company
Limited Liability Company.
Core business
Investment Company.
Address
Praça Leoni Ramos, nº 1, 7º andar, bloco 2,
São Domingos.
Niterói, Rio de Janeiro.
Directorio
Mario Fernando de Melo Santos (Chairman)
Luca D’Agnese (Vice Chairman)
Antonio Basilio Pires de Carvalho e
Albuquerque
Aurelio Ricardo Bustilho de Oliveira
Anna Brogi
Corporate purpose
Its purpose is the planning, development
and execution of generation, distribution,
transmission and/ or commercialization
activities of electric energy. Likewise,
the participation in the equity capital
of other companies and entities that
operate or constitute to act in the
generation, distribution, transmission
and/ or commercialization of electric
energy segments as partners, consortia or
shareholder.
Core business
Electricity generation.
Company that doesn’t have management
board (Board of Directors)
Senior Management
Carlo Federico Vladimir Il’ic Zorzoli
(General Management)
Aurelio Ricardo Bustilho de Oliveira
Senior Management
Carlo Federico Vladimir Il‘ic Zorzoli
(General Manager)
Aurelio Ricardo Bustilho de Oliveira
Antonio Basilio Pires de Carvalho E
Albuquerque
Carlos Ewandro Naegele Moreira
José Alves de Mello Franco
José Nunes de Almeida Neto
Janaina Savino Vilella Carro
Flávia da Silva Baraúna
Margot Frota Cohn Pires
Márcia Massotti de Carvalho
Luis Alonso Campos Rivas
Guilherme Gomes Lencastre
Matteo de Zan
Cristine de Magalhães Marcondes
André Osvaldo dos Santos
Carlos Omar Arriagada Retamal
Roberto Zanchi
Bruno Cecchetti
Business Relations
The company has no commercial relations
with Enel Américas S.A.
Business Relations
The company has no commercial relations
with Enel Américas S.A.
ENEL BRASIL S.A.
ENEL CIEN S.A.
Company Name
Enel Brasil S.A.
Company Name
ENEL CIEN S.A.
Type of Company
Limited Liability Company
Type of Company
Limited Liability Company
Business Relations
The company has no commercial relations
with Enel Américas S.A.
Address
Praça Leoni Ramos, N°1, 7° andar, bloco 2
Parte, Niterói, Río de Janeiro, Brasil
Phone
(5521) 3607 9500
Subscribed and paid-in capital (US$
thousand)
2,048,191.57
Address
Praça Leoni Ramos, N° 1, piso 6, Bloco 2,
SãoDomingos, Niterói
Río de Janeiro, Brasil
Phone
(55 21) 3607 9500
Subscribed and paid-in capital (US$
thousand)
86,046.49
Corporate purpose
Participate in the capital of other companies
in any segment of the electricity sector,
including companies that provide services to
Corporate purpose
The purpose of the company is the
production, industrialization, distribution and
171
Identification of Subsidiaries and Associate Companies ENEL DISTRIBUCIÓN
GOIÁS S.A.
Company Name
Celg Distribuição S.A. - Celg-D
Type of Company
Limited Liability Company.
Address
Rua 2, Quadra A-37, nº 505, Jardim Goiás,
Goiânia, Goiás.
Phone
62 3243 1771
Subscribed and paid-in capital (US$
thousand)
1,406,316.22
Corporate purpose
The corporate purpose is the technical
and commercial exploration of electricity
distribution.
Core business
Electricity Distribution
Directorio
Mario Fernando de Melo Santos
(Chairman)
Carlo Federico Vladimir Il’ic Zorzoli
(Vice Chairman)
Antonio Basilio Pires de Carvalho e
Albuquerque
Gianluca Caccialupi
Aurelio Ricardo Bustilho de Oliveira
Maria Eduarda Fischer Alcure
Senior Management
Abel Alves Rochinha (General Manager)
Rodrigo Raposo da Camara Machado
Nelson Ribas Visconti
Déborah Meirelles Rosa Brasil
Raimundo Câmara Filho
Roberto Nunes Fonseca Junior
Emerson Caçador Rubim
Carlos Omar Arriagada Retamal
Business Relations
The company has no commercial relations
with Enel Américas S.A.
trading acts related to those activities.
Likewise, the company may carry out
studies, planning, projects, construction
and operation of production, transformation,
transportation and storage, distribution and
sale of energy systems, of any origin, in
the form of concessions, authorizations or
permits it may be awarded, with jurisdiction
in the territory of the State of Ceará, and
others defined in the Grantor. The Society
may also carry out studies, projects and
planning and research and development
programs of new energy sources, especially
renewable, and the study, making and
execution, in the energy sector, of plans
and programs for economic and social
development, in places of interest for the
community and for the company.
Core business
Distribution and sale of electricity and related
services in the State of Ceará, Brazil.
Regular Directors
Mário Fernando de Melo Santos
(Chairman)
Carlo Federico Vladimir Il‘ic Zorzoli
(Vice Chairman)
Anna Brogi
Monica Hodor
Ramón Francisco Castañeda Ponce
Gianluca Caccialupi
Cristine de Magalhães Marcondes
Francisco Honório Pinheiro Alves
Fernando Antonio de Moura Avelino
Fernando Augusto Macedo de Melo
Aurelio Ricardo Bustilho de Oliveira
Alternate Directors
Márcia Sandra Roque Vieira Silva
José Nunes de Almeida Neto
Maria Eduarda Fischer Alcure
Deborah Meirelles Rosa Brasil
Teobaldo José Cavalcante Leal
José Tavora Batista
Carlos Ewandro Naegle Moreira
Marcia Massotti de Carvalho
Cesario Macedo de Melo Neto
Nelson Ribas Visconti
Dilma Maria Toledo
Senior Management
Roberto Zanchi (General Manager)
José Távora Batista
Aurelio Ricardo Bustilho de Oliveira
Carlos Ewandro Naegele Moreira
José Nunes de Almeida Neto
Janaina Savino Vilella Carro
José Alves Mello Franco
Margot Frota Cohn Pires
Déborah Meirelles Rosa Brasil
Fernando Andrade
Márcia Sandra Roque Vieira Silva
Business Relations
The company has no commercial relations
with Enel Américas S.A.
commercialization of electricity, including
the import and export activities. In view of
achieving the purposes mentioned above,
the company will promote the study,
planning and construction of facilities
for production systems, transmission,
conversion and distribution of electricity
by capturing the necessary investment
to develop the activities and by providing
services. Beyond the purposes referred
to, the company may promote the
implementation of associated products, as
well as inherent, ancillary or complementary
activities to services and jobs that come to
provide. To carry out the activities necessary
to achieve its goals, the company may
participate in other societies.
Core business
Electricity transmission.
Directorio
Carlo Federico Vladimir Il‘ic Zorzoli
(Chairman)
Julia Freitas de Alcantara Nunes
(Vice Chairman)
Orestes Lizardo Castañeda Pacheco
Senior Management
Abel Alves Rochinha (General Manager)
Aurelio Ricardo Bustilho de Oliveira
Orestes Lizardo Castañeda Pacheco
José Alves Mello Franco
Déborah Meirelles Rosa Brasil
Carlos Ewandro Naegele Moreira
José Nunes de Almeida Neto
Janaina Savino Vilella Carro
Margot Frota Cohn Pires
Business Relations
The company has no commercial relations
with Enel Américas S.A.
ENEL DISTRIBUCIÓN
CEARÁ
Company Name
Companhia Energética do Ceará
Type of Company
Publicly Traded Company
Address
Rua Padre Valdevino, 150 - Centro
Fortaleza, Ceará, Brasil
Phone
(55 85) 3453-4082
Subscribed and paid-in capital (US$
thousand)
185,935.99
Corporate purpose
Generation, transmission, distribution and
commercialization of electricity, performing
awarded or authorized correlated services,
and the development of activities associated
with the services, as well as celebrating
172
Annual Report Enel Américas 2017 ENEL DISTRIBUCIÓN
PERÚ S.A.A.
ENEL DISTRIBUCIÓN
RÍO S.A.
ENEL GENERACIÓN
COSTANERA S.A.
Company Name
Enel Distribución Perú S.A.A.
Type of Company
Publicly Traded Company
Company Name
Ampla Energia e Serviços S.A.
Type of Company
Sociedad Anónima Abierta
Address
Calle César López Rojas 201 Urb, Maranga,
San Miguel
Lima, Perú
Address
Praça Leoni Ramos, N° 01, São Domingos, Niteroi
Río de Janeiro, Brasil
Phone
(51 1) 561 2001
Phone
(55 21) 2613 7000
Subscribed and paid-in capital (US$
thousand)
164,177.92
Subscribed and paid-in capital
(US$ thousand)
754,141.23
Company Name
Enel Generación Costanera S.A.
Type of Company
Publicly Traded Company
Address
Avda, España 3301, Buenos Aires, Argentina
Phone
(5411) 4307 3040
Subscribed and paid-in capital (US$
thousand)
37,986.13
Corporate purpose
Electricity generation and trading in blocks
of energy.
Core business
Electricity generation.
Regular Directors
Juan Carlos Blanco (Chairman)
Antonino Ascione (Vice Chairman)
María Victoria Ramírez
Mónica Diskin
César Fernando Amuchástegui
Matías Maria Brea
Marcelo Luis Diez
Corporate purpose
Study, plan, project, build and explore electricity
production, transmission, transformation,
distribution and sale systems, and provide
related services that have been or may be
conceded; carry out research in the energy
sector, participate in regional, national or
international organizations dedicated to the
planning, operation, technical Exchange and
business development related to the electricity
industry and participate as a shareholder in other
companies in the energy sector, even within the
framework of Brazil´s privatization program.
Core business
Electricity Distribution
Regular Directors
Mario Fernando de Melo Santos (Chairman)
Monica Hodor (Vicepresidente)
Carlo Federico Vladimir Il’ic Zorzoli
José Távora Batista
José Alves de Mello Franco
Aurélio Ricardo Bustilho de Oliveira
Luiz Carlos Franco Campos
Alternate Directors
Gaetano Aslierno
Fernando Boggini
Marcello Coffaro
Rodrigo Quesada
Mariana Mariné
Janeth Cabrera
Senior Management
Andrea Biasotto
General Manager
Alternate Directors
Otacilio de Souza Junior
Déborah Meirelles Rosa Brasil
Flávia da Silva Baraúna
Márcia Massotti de Carvalho
Gabriel Maluly
Claudio César Wayne da Cunha
Carlos Ewandro Naegele Moreira
Senior Management
Ramón Francisco Castañeda Ponce (General
Manager)
Aurelio Ricardo Bustilho de Oliveira
Carlos Ewandro Naegele Moreira
José Nunes de Almeida Neto
Janaina Savino Vilella Carro
José Alves Mello Franco
Déborah Meirelles Rosa Brasil
Margot Frota Cohn Pires
Fernando Andrade
Márcia Sandra Roque Vieira Silva
Business Relations
The company has no commercial relations
with Enel Américas S.A.
Business Relations
The company has no commercial relations
with Enel Américas S.A.
173
Corporate purpose
Engage the activities of distribution,
transmission and generation of electricity in
accordance with the provisions of current
legislation. Additionally, the company may
engage in the sale of goods in any form, as
well as providing consulting and financial
services, among others, except those
services, which require specific authorization
in accordance with current law.
Core business
Electricity Distribution
Directorio
Carlos Temboury Molina (Chairman)
Guillermo Lozada Pozo (Vice Chairman)
Riccardo Lama
Carlos Solis Pino
Gianluca Caccialupi
Fernando Fort Marie
Mario Ferrari Quiñe
José De Bernardis Cuglievan
Senior Management
General Manager
Ricardo Lama
Guillermo Martin Lozada Pozo
Administration, Finance & Control Manager
Carlos Alberto Solis Pino
Commercial Manager
Luis Salem Hone
Legal Counsel
Milagritos Tatiana Lozada Gobea
Regulation Manager
Rocío Pachas Soto
Organization and Human Resources Manager
María Alicia Martínez Venero
Communications Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
Identification of Subsidiaries and Associate Companies ENEL GENERACIÓN
EL CHOCÓN S.A.
Company Name
Enel Generación El Chocón S.A.
Phone
(55 85) 3464-4100
also the civil, industrial, commercial and any
other act or operation related or leading to its
Main Corporate Purpose.
Subscribed and paid-in capital (US$
thousand)
45,864.88
Core business
Electricity generation.
Type of Company
Publicly Traded Company
Address
Avda, España 3301
Buenos Aires, Argentina
Subscribed and paid-in capital (US$
thousand)
15,616.06
Corporate purpose
Electricity Generation and its block
commercialization
Core business
Electricity generation.
Regular Directors
Mauricio Bezzeccheri (Chairman)
Paolo Giovanni Pescarmona (Vice Chairman)
Mónica Diskin
María Victoria Ramírez
Antonino Ascione
Alex Daniel Horacio Valdez
Juan Carlos Nayar
Alberto Eduardo Mousist
Alternate Directors
Daniel Martini
Marcello Coffaro
Fernando Boggini
Rodrigo Quesada
Mariana Mariné
Sebastián Eduardo Guasco
Oscar Horacio Carvalho
Enrique Díaz Riva
Senior Management
Daniel Garrido
General Manager
ENEL GENERACIÓN
FORTALEZA S.A.
Company Name
CGTF - Central Geradora Termeléctrica
Fortaleza S.A.
Type of Company
Limited Liability Company
Address
Rodovia 422, Km 1 s/n,
Complexo Industrial e
Portuário de Pecém Caucaia
Ceará, Brasil
174
Corporate purpose
To study, project, construct and explore
electricity production, transmission,
distribution and trading systems, awarded,
permitted or authorized by any rights title,
as well as any other activity related to the
aforementioned activities; acquisition,
obtaining and exploration of any right,
concession or privilege related to the
aforementioned activities, as well as the
practice of all other acts and businesses
necessary to reach its purpose; and
participation in other companies or societies
corporate capital, as shareholder, partner or
on account of participation, whichever its
purposes are.
Regular Directors
Carlos Temboury Molina (Chairman)
Marco Raco
Eugenio Calderón López
Guillermo Martín Lozada Pozo
Rocío Pachas Soto
Francisco García Calderón Portugal
Claudio Herzka Buchdahl
Alternate Directors
Jean Philippe Salvatore Bellavia
Rigoberto Novoa Velásquez
Daniel Abramovich Ackerman
Carlos Sedano Tarancón
Úrsula De La Mata Torres
Milagritos Tatiana Lozada Gobea
Ernesto Villanueva Roca
Core business
Electricity generation.
Directorio
Carlo Federico Vladimir Il‘ic Zorzoli
(Chairman)
Marcelo Falcucci
Aurelio Ricardo Bustilho de Oliveira
Senior Management
Aurelio Ricardo Bustilho de Oliveira
(Interim General Manager)
Pedro Werbest Alves Silva
Claudia Maria Suanno
Janaina Savino Vilella Carro
Raimundo Câmara Filho
Ana Claudia Gonçalves Rebello
José Nunes de Almeida Neto
José Alves de Mello Franco
Margot Frota Cohn Pires
Business Relations
The company has no commercial relations
with Enel Américas S.A.
Company Name
Enel Generación Perú S.A.A.
Type of Company
Publicly Traded Company
Senior Management
Marco Raco
General Manager
Pedro Cruz Vine
Energy Management and Trading Manager
Daniel Abramovich Ackerman
Legal Counsel
Guillermo Marín Lozada Pozo
Administration, Finance and Control Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
ENEL GENERACION
PIURA S.A.
Company Name
Enel Generación Piura S.A.
Type of Company
Publicly traded company
Address
Calle César López Rojas 201, Urb. Maranga,
San Miguel
Lima, Perú
Subscribed and paid-in capital (US$
thousand)
25,172.98
Address
Calle César Lopez Rojas N° 201, Urb.
Maranga, San Miguel
Lima, Peru (address change according to
memo 2015)
Corporate purpose
The main purpose of the company is
the generation, sale and transmission of
electricity, performing all acts and signing all
agreements allowed by current legislation.
Subscribed and paid-in capital (US$
thousand)
859,200.01
Corporate purpose
In general, electricity generation activities,
Core business
Electricity generation and sale of natural gas.
Directors
Carlos Temboury Molina (Chairman)
Marco Raco (Vice Chairman)
Guillermo Martin Lozada Pozo
Business Relations
The company has no commercial relations
with Enel Américas S.A.
ENEL GENERACIÓN
PERÚ S.A.A.
Annual Report Enel Américas 2017 Ejecutivos principales
Marco Raco (representing Enel Generación
Perú S.A.A.)
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
ENEL GREEN POWER
CACHOEIRA DOURADA
S.A.
Company Name
Enel Green Power Cachoeira Dourada S.A.
Type of Company
Limited Liability Company
Address
Rodovia GO 206, Km 0, Cachoeira Dourada
Goiânia
Goiás, Brasil
Phone
(55 62) 3434 9000
Subscribed and paid-in capital (US$
thousand)
19,422.28
Corporate purpose
The corporate purpose of the Company
is the carrying out of studies, planning,
construction, installation, operation and
exploitation of electricity generation plants,
and the trade related to these activities.
Likewise, the company may foster or
participate in other societies formed for the
production of electricity, in or out of the Sate
of Goiás.
Core business
Electricity generation
Directorio
Carlo Federico Vladimir Il‘ic Zorzoli
(Chairman)
Aurelio Ricardo Bustilho de Oliveira
Claudia Maria Suanno
Senior Management
Luigi Parisi (General Manager)
Aurelio Ricardo Bustilho de Oliveira
Newton Souza de Moraes
Matteo de Zan
Nelson Ribas Visconti
Janaina Savino Vilella Carro
Carlos Ewandro Naegele Moreira
Ana Claudia Gonçalves Rebello
José Nunes de Almeida Neto
Anna Paula Hiotte Pacheco
Margot Frota Cohn Pires
Business Relations
The company has no commercial relations
with Enel Américas S.A.
ENEL GREEN POWER
MODELO I EÓLICA S.A.*
Company Name
Enel Green Power Modelo I Eólica S.A.
Type of Company
Limited Liability Company.
Address
Praça Leoni Ramos, Nº 1, 5º andar, bloco 2
Niterói, RJ, Brasil
Corporate purpose
Wind electricity generation
Core business
Electricity generation.
Administration
Newton Souza de Moraes
André Bruno Santos Gordon Afonso
Márcio Teixeira Trannin
Business Relations
The company has no commercial relations
with Enel Américas.
*The shares of Enel Green Power Modelo
Eólica I S.A that were formerly owned by
Enel Brasil S.A were transferred to Enel
Green Power Brasil Participações LTDA,
on September 29, 2017, through a shares
purchase and sale agreement.
ENEL GREEN POWER
PROJETOS I S.A
(Volta Grande)
Company Name
Enel Green Power Projetos I S.A
Type of Company
Limited Liability Company.
Address
Praça Leoni Ramos, nº 1, 5º andar - parte,
bloco 1, São Domingos.
Niterói, Rio de Janeiro.
Phone
(21) 2716-1100
Subscribed and paid-in capital (US$
thousand)
170,784.56
Corporate purpose
Its main activity is the generation of
electricity, pursuant to the current regulation.
Likewise, the company is enabled to
commercialize energy by any means and in
any market.
Core business
Electricity generation.
The company does not have a Board of
Directors. )
ENEL GREEN POWER
MODELO II EÓLICA S.A. *
Senior Management
Leonardo Soares Walter
Newton Souza de Moraes
Company Name
Enel Green Power Modelo II Eólica S.A.
Type of Company
Limited Liability Company
Address
Praça Leoni Ramos, Nº 1, 5º andar, bloco 2
Niterói, RJ, Brasil, CEP: 24.210-205
Corporate purpose
Wind electricity generation.
Core business
Wind electricity generation
Administration
Newton Souza de Moraes
André Bruno Santos Gordon Afonso
Márcio Teixeira Trannin
Business Relations
The company has no commercial relations
with Enel Américas.
*The shares of Enel Green Power Modelo
Eólica II S.A that were formerly owned by
Enel Brasil S.A were transferred to Enel
Green Power Brasil Participações LTDA,
on September 29, 2017, through a shares
purchase and sale agreement.
Business Relations
The company has no commercial relations
with Enel Américas S.A.
ENEL PERÚ S.A.C.
Company Name
Enel Perú S.A.C.
Type of Company
Limited Liability Company
Address
Calle César López Rojas 201, Urb. Maranga,
San Miguel
Lima, Perú
Subscribed and paid-in capital (US$
thousand)
1,656,474.44
Corporate purpose
Perform investments in other companies, most
preferably in those involved in the exploitation
of natural resources, and especially those
related to the distribution, transmission and
generation of electricity. Develop engineering
services for the construction of power plants;
perform activities related to the supply,
175
Identification of Subsidiaries and Associate Companies assembly and commissioning of equipment
and/ or services for electricity generation.
Additionally, the company may carry out any
other activity related to the electricity and
water sectors. The company may also make
equity investments in any kind of property
including stocks, bonds and any other class
of transferable securities, as well as the
administration of such investments within
the limits set by the board and ordinary
shareholders meeting. The activities that are
considered within the purpose of the company
may be carried out in Peru and abroad.
Core business
Investment Company.
Ejecutivos principales
Carlos Temboury Molina
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
ENEL SOLUÇÕES S.A.
Company Name
ENEL SOLUÇÕES S.A.
Type of Company
Limited Liability Company constituted
pursuant to the Brazilian law.
Address
Praça Leoni Ramos nº 01
Parte, São Domingos, Niterói, Rio de Janeiro,
Brasil.
Phone
(55 21) 2613 7000
Subscribed and paid-in capital (US$
thousand)
15,869.96
Corporate purpose
The company’ objective is to participate
in the capital of other companies in Brazil
or abroad, trade in general, even imports
and exports, through retail or wholesale
transactions of various products, and to
provide general services for the energy
electricity sector and others.
Core business
Provision of services in general to the
electricity industry and others.
The company does not have an
administration council (Board of Directors)
Senior Management
Marcio Teixeira Trannin
Tennessee Williams Pearce Maia
Rafael Felipe Coelho da Silva
Business Relations
The company has no commercial relations
with Enel Américas S.A.
176
ENEL TRADING
ARGENTINA S.R.L.
Company Name
Enel Trading Argentina S.R.L.
Type of Company
Limited Liability Company
Address
San José 140, piso 6, CABA
Buenos Aires, Argentina
Phone
(5411) 4124-1600
Subscribed and paid-in capital (US$
thousand)
733
Corporate purpose
The purpose of the company is the
wholesale purchase and sale of electricity
capacity and energy produced and/or
consumed by third parties, including the
import and export of electricity power and
energy and the marketing of royalties, and
the supply and/or performing of services
related to the above activity, both in the
country as well as abroad of information
technology services and/or of control of the
operation and/or of telecommunications.
Likewise, the Company shall be entitled
to execute buy/sell operations or to
purchase and sell natural gas, and/or its
transportation, including the importation
and/or exportation of natural gas and/or the
marketing of regalia/privileges, as well as
to provide and/or execute services related
to the abovementioned activity. Also, the
Company shall be entitled to execute buy/
sell operations or to purchase and sell
crude petroleum, and/or lubricants and/or
to transport such elements, including the
importation and/or exportation of liquid fuels
and the marketing of regalia/privileges, as
well as to provide and/or execute services
related to the aforementioned activity.
Core business
Trading of electricity, gas and derivatives.
IT services and/or operation control and/or
telecommunications.
Gerentes titulares
Maurizio Bezzeccheri
Paolo Giovanni Pescarmona
Gerentes suplentes
Mónica Diskin
Gaetano Salierno
Senior Management
Livio Filippo Colasanto
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
EÓLICA FAZENDA
NOVA *
Company Name
Eólica Fazenda Nova o Geraçãoa e
Comercialização de Energia S.A.
Type of Company
Limited Liability Company
Address
Rua Felipe Camarão, nº 507, sala 104
Ciudad de Natal, Rio Grande do Norte, Brasil
Phone
(5521) 3607 9500
Corporate purpose
Generation, transmission, distribution and
trading of energy, participation in other
companies as a partner, shareholder, or
quota holders and import machinery and
equipment related to the generation,
transmission, distribution and trading of wind
energy.
Core business
Electricity generation.
Administration
Márcio Teixeira Trannin (General Manager)
Leonardo Soares Walter
Business Relations
The company has no commercial relations
with Enel Américas S.A.
*Enel Brasil S.A absorbed the company. on
September 21, 2017.
GENERANDES PERÚ S.A. *
Company Name
Generandes Perú S.A.
Type of Company
Publicly Traded Company
Address
Calle César Lopez Rojas 201 N° 201, Urb.
Maranga, San Miguel
Lima, Perú
Phone
(511) 215 6300
Corporate purpose
The company has the purpose to develop
activities related to electricity generation,
directly, or through companies created for
that purpose .
Core business:
Investment Company.
* Enel Perú S.A.C absorbed the company on
April 28, 2017.
Annual Report Enel Américas 2017 HIDROINVEST S.A.
Company Name
Hidroinvest S.A.
Type of Company
Sociedad Anónima
Address
Avda, España 3301
Buenos Aires, Argentina
Phone
(5411) 4307 3040
Subscribed and paid-in capital (US$
thousand)
18.869,66
Corporate purpose
Acquire and maintain a majority shareholding
in Hidroeléctrica Alicura S.A. and/or
Hidroeléctrica El Chocón S.A. and/or
Hidroeléctrica Cerros Colorados S.A. (“the
concessionaire companies”) created by
National Executive Power decree 287/93 and
manage such investments.
Core business
Investment Company.
Regular Directors
Mauricio Bezzeccheri (Chairman)
Gaetano Salierno (Vice Chairman)
Mónica Diskin
Alternate Directors
María Victoria Ramírez
Business Relations
The company has no commercial relations
with Enel Américas S.A.
INGENDESA DO
BRASIL Ltda.
(Company under
liquidationn)
Company Name
Ingendesa do Brasil Ltda.
Type of Company
Limited Liability Company
Domicilio
Praça Leoni Ramos, Nº 1
Parte, São Domingos
Niterói - RJ, Brasil
Subscribed and paid-in capital (US$
thousand)
747.65
inspection and reception of materials and
equipment for laboratories, appraisals,
commercial representation of local and
foreign engineering companies, as well
as other services that the legal powers
permit in the practice of the professions of
engineering, architecture, agronomy, geology
and meteorology in all their specialties.
Core business
Engineering services.
Representative
Bruno César Vasconcelos
Business Relations
The company has no commercial relations
with Enel Américas S.A.
INVERSIONES
DISTRILIMA S.A.C. *
Company Name
Inversiones Distrilima S.A.C.
Type of Company
Limited Liability Company
Address
Calle César López Rojas 201,
Urb. Maranga, San Miguel
Lima, Perú
Phone
(511) 561 1604
Corporate purpose
Perform investments in other companies,
most preferably in those Involved in the
exploitation of natural resources, and
especially those related to the distribution,
transmission and generation of electricity.
In order to perform according to its purpose
and practice the activities related to it, the
company may perform all actions and enter
into all contracts that the Peruvian laws
allow to corporations. The company may
also make equity investments in any kind
of property including stocks, bonds and any
other class of transferable securities, as well
as the administration of such investments
within the limits set by the board and ordinary
shareholders meeting. The activities that are
considered within the purpose of the company
may be carried out in Peru and abroad.
* Enel Perú S.A.C absorbed the company on
April 28, 2017.
INVERSORA
CODENSA S.A.S.
Corporate purpose
Offer services in engineering, studies,
projects, technical consulting, management,
inspection and supervision of works supply,
Company Name
Inversora Codensa S.A.S.
Type of Company
Sociedad por acciones simplificada
Address
Carrera 11 N°82-76, Piso 4
Bogotá, Colombia
Phone
(571) 601 6060
Subscribed and paid-in capital (US$
thousand)
1.67
Corporate purpose
Investment in residential public electric utility
services, especially the acquisition of shares
in any public electric utility or in any other
company that also invests in utilities whose
main purpose is residential electricity service
according to the definition in Law 142 of
1994, or in any other company that also
invests in utilities whose main purpose is
residential public electric utility services.
Core business
Investment Company.
Senior Management
David Felipe Acosta Correa
Manager
Leonardo Lopez Vergara
First Deputy Manager
Juan Manuel Pardo Gómez
Second Deputy Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
INVERSORA DOCK
SUD S.A.
Company Name
Inversora Dock Sud S.A.
Type of Company
Limited Liability Company
Address
Avenida Debenedetti 1636 Dock Sud
Avellaneda
Phone
4229-1000
Subscribed and paid-in capital (US$
thousand)
41,793.93
Corporate purpose
The corporate purpose of the company is the
participation in companies of any nature, by
means of creating shareholding companies,
transitory company ventures, collaboration
groups, joint ventures, consortiums and any other
kind of association, and in general, the purchase,
sale and negotiation of titles, shares and all other
kind of securities and credit papers in any of the
systems or modes created or to be created.
Core business
Investment Company.
177
Identification of Subsidiaries and Associate Companies Regular Directors
Mauricio Bezzeccheri (Chairman)
Paolo Pescarmona (Vice Chairman)
Hector Martin Mandarano
Santiago Matías Sajaroff
Mónica Analía Ciacciarelli
Antonio Ascione
Alternate Directors
(Enel’s vacant position)
Mónica Diskin
Gaetano Salierno
Raúl Ángel Rodríguez
Patricio Cipollone
María Eugenia Pardo
Regular Directors
Roberto De Antoni
Nagelo Cefalu
Daniel Flaks
Eduardo Maggi
Alternate Directors
Fabio Canosa
Leonardo Lintura
Miguel Patricio Farrell
José Luis Marinelli
Senior Management
Francisco Cerar
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
Business Relations
The company has no commercial relations
with Enel Américas S.A.
SACME S.A.
Company Name
Sacme S.A.
SOCIEDAD PORTUARIA
CENTRAL CARTAGENA
S.A.
Type of Company
Limited Liability Company
Company Name
Sociedad Portuaria Central Cartagena S.A.
Address
Avda, España 3251
Ciudad Autónoma de Buenos Aires,
Argentina
Phone
(5411) 4361 5107
Subscribed and paid-in capital
(Argentinean Pesos)
1,569
Corporate purpose
Conduct, supervise and control the operation
of the electricity generation, transmission
and sub transmission system of Capital
Federal and Gran Buenos Aires, and
the interconnections with the Argentine
Interconnection System (SADI in its Spanish
acronym). Represent the companies
Distribuidora Edenor S.A. and Edesur
S.A. in terms of operations, before the
wholesale market administrator, Compañía
Administradora del Mercado Mayorista
Eléctrico (CAMMESA in its Spanish acronym.
In general, adopt all actions necessary to
allow it to carry out the administration of
the business correctly, as being constituted
for this purpose by the concessionaire
companies of the electricity distribution and
trading in Capital Federal and Gran 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.
Core business
Lead, supervise and control of operations
from the Argentine electricity system.
Type of Company
Publicly Traded Company
Address
Carrera 13 A No. 93-,66, piso 2
Bogotá, D.C. Colombia
Subscribed and paid-in capital (US$
thousand)
1.94
Corporate purpose
The company’s main purpose is the
following: investment, construction and
maintenance of docks and private and public
ports, their management and operations
and the development and operation of a
multipurpose port, in accordance with the
law, among others.
Regular Directors
Bruno Riga
Leonardo Lopez Vergara
Juan Manuel Pardo
Alternate Directors
Fernando Javier Gutierrez Medina
Alba Lucia Salcedo
Luis Fernando Salamanca
Senior Management
Fernando Gutierrez Medina
General Manager
Bruno Riga
First Deputy General Manager
Oswaldo Rafael Novoa Arroyo
Second Deputy General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
178
TERMOELÉCTRICA JOSÉ
DE SAN MARTÍN S.A.
Company Name
Termoeléctrica José de San Martín S.A.
Type of Company
Publicly Traded Company
Address:
Elvia Rawson de Dellepiane 150, piso 9,
Buenos Aires, República de Argentina
Phone:
(54 11) 4117-1011/1041
Subscribed and paid-in capital
(US$ thousand)
53.65
Corporate purpose
The generation of electricity and its block
trading, and 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 N° 1427/2004”,
approved by Resolution SE N° 1193/2005.
Core business
Electricity generation. Management services
(acquisition of equipment, construction,
operation and maintenance of a thermal
power plant).
Regular Directors
Ricardo Arakaki
Adrián Gustavo Salvatore
Andrea Biasotto
Mónica Diskin
Martín Genesio
Emiliano Chaparro
Gerardo Carlos Paz
José Manuel Tierno
Jorge Ravlich
Alternate Directors
Leonardo Pablo Katz
Leonardo Marinaro
Fernando Antognazza
Iván Durontó
Julián McLoughlin
Luís Agustín León Longobardo
Sergio Raúl Sánchez
Rodrigo García
Antonino Ascione
Senior Management
Ricardo Arakaki
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
Annual Report Enel Américas 2017 TERMOELÉCTRICA
MANUEL BELGRANO
S.A.
TESA
Company Name
Transportadora de Energía S.A.
Company Name
Termoeléctrica Manuel Belgrano S.A.
Type of Company
Sociedad Anónima
Corporate purpose
Construction, operation and maintenance
of the first electrical link between Yacyretá
Hydroelectric Plant and the Resistance’s
Transformation Station, and provision of
electricity transmission services, including
the exploitation under concession as
independent transporter.
Type of Company
Publicly Traded Company
Domicilio
Suipacha 268, piso 12
Buenos Aires, Argentina
Phone
(5411) 3 221 7950
Subscribed and paid-in capital (US$
thousand)
31.47
Corporate purpose
The company’s purpose is the generation
of electricity and its block trading, and
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 N° 1427/2004”,
approved by Resolution SE N° 1193/2005.
Core business
Management services (acquisition of
equipment, construction, operation and
maintenance of a thermal power plant).
Electricity generation.
Regular Directors
Martín Genesio
Emiliano Chaparro
Adrián Gustavo Salvatore
José Manuel Pazos
Antonino Ascione
Mónica Diskin
Gerardo Carlos Paz
José Manuel Tierno
Vacant position
Alternate Directors
Guillermo Giraudo
Julián Mc Loughlin
Gaetano Salierno
Vacant position
Leonardo Marinaro
Leonardo Pablo Katz
Luis Agustín León Longobardo
Sergio Raúl Sánchez
Rodrigo García
Senior Management
Francisco Monteleone
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
Address
Bartolomé Mitre 797, 11th Floor
Buenos Aires, Argentina
Phone
(5411) 4394 1161
Subscribed and paid-in capital
(US$ thousand)
5.23
Corporate purpose
High tension electricity transmission
services’ provision, linked to both national
and international electrical systems, for
which purpose it may participate in national
and international tenders, become a high
tension electricity transmission utilities
concessionaire, locally or abroad, and carry
out all activities deemed necessary to fulfill
its purpose.
Core business
Electricity transmission.
Regular Directors
Juan Carlos Blanco (Chairman)
Paolo Giovanni Pescarmona (Vice Chairman)
Mónica Diskin
Alternate Directors
Gaetano Salierno
Angelo Cefalu
Senior Management
Sandro Ariel Rollan
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
YACYLEC S.A.
Company Name
Yacylec S.A.
Type of Company
Limited Liability Company
Address
Bartolomé Mitre 797, 11th Floor;
Buenos Aires, Argentina
Phone
(5411) 4587 4322/4585
Subscribed and paid-in capital
(US$ thousand)
1,258.72
Core business
Electricity transmission.
Regular Directors
Jorge Guillermo Neira (Chairman)
Juan M. Pereyra (Vice Chairman)
Juan Carlos Blanco
Paolo Giovanni Pescarmona
Gerardo Ferreyra
Osvaldo Acosta
Guillermo Díaz
Eduardo Albarracín
Rafaelle Sardella
Luis Juan B. Piatti
Mónica Diskin
Marisa Varela Toba
Alternate Directors
Gaetano Salierno
Carlos Fernando Bergoglio
Juan José Arena
Gianfranco Catrini
Massimo Villa
Roberto Leonardo Maffioli
Darío Ballaré
Sergio Alejandro Vestfrid
Angelo Cefalu
Robert Ortega
Alberto E. Verra
Ejecutivos principales
Sandro Ariel Rollan
General Manager
Business Relations
The company has no commercial relations
with Enel Américas S.A.
Notes:
1. There are no acts or agreements signed
by Enel Américas with its subsidiaries
or associated companies that could
significantly influence its operations and
results.
2. With regards to the business relations,
future relations planned with subsidiaries
or associated companies fall within the
company’s corporate purpose, especially
continuing to provide its subsidiaries and
associated companies with the necessary
financial resources for their businesses’
development and, additionally, to provide
its subsidiaries with management,
financial advisory, business, technical,
legal, audit services and, in general,
services of any kind deemed
necessary for their best performance,
notwithstanding which, it is not foreseen
that any of these connections would
significantly influence Enel America’s
operations and results.
179
Identification of Subsidiaries and Associate Companies 21Statement of Responsibility
180
Annual Report Enel Américas 2017 181
Letter from the Chairman 182
Annual Report Enel Américas 2017 Statement of Responsibility
The Directors of Enel Américas S.A. and the Chief Executive Officer, signatories of this statement, are responsible under
oath of the veracity of the information provided in this Annual Report, in compliance with the General Norm N°30, issued
by the Superintendence of Securities and Insurances.
CHAIRMAN
Borja Acha Besga
DNI: 05263174-S
DIRECTOR
José Antonio Vargas Lleras
DNI: 79,312,642
DIRECTOR
Hernán Somerville Senn
Rut: 4,132,185-7
DIRECTOR
Patricio Gómez Sabaini
Passport: 16941675N
DIRECTOR
Livio Gallo
DNI: AV 0246369
DIRECTOR
Domingo Cruzat Amunátegui
Rut: 6,989,304-K
DIRECTOR
Enrico Viale
DNI: AU 2580379
CHIEF EXECUTIVE OFFICER
Luca D’Agnese
Rut: 24,910,349-7
Statement of Responsibility
183
184
Annual Report Enel Américas 2017 ADMINISTRATION
CHAIRMAN
Borja Acha Besga
PHONE (56) 2 2263 4631
DIRECTOR
José Vargas Lleras
PHONE (56) 2 2353 4631
DIRECTOR
Enrico Viale
PHONE (56) 2 2353 4631
DIRECTOR
Livio Gallo
PHONE (56) 2 2353 4631
DIRECTOR
Hernán Somerville Senn
PHONE (56) 2 2353 4631
DIRECTOR
Domingo Cruzat Amunátegui
PHONE (56) 2 2353 4631
DIRECTOR
Patricio Gómez Sabaini
PHONE (56) 2 2353 4631
CHIEF EXECUTIVE OFFICER
Luca D’Agnese
PHONE (56) 2 2263 9130
COMMUNICATIONS OFFICER
José Miranda Montecinos
PHONE (56) 2 2675 2746
INTERNAL AUDIT OFFICER
Raffaele Cutrignelli
PHONE (56) 2 2353 4647
CHIEF FINANCIAL OFFICER
Paolo Pallotti
PHONE (56) 2 2353 4510
PLANNING AND CONTROL OFFICER
Emanuele Brandolini
PHONE (56) 2 2353 4510
GENERAL COUNSEL
Domingo Valdés Prieto
PHONE (56) 2 2630 9227
INVESTOR RELATIONS
HEAD OF INVESTOR RELATIONS
Rafael De La Haza Casarrubio
PHONE (56) 2 2353 4682
CITIBANK NY
Teresa Loureiro-Stein
PHONE (1-212) 816 6814
enelamericas.com