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ANNUAL
REPORT
2015
enel.com
Annual Report 2015
Contents
Report on operations
Reports
Report of the Board of Auditors to the Shareholders’ Meeting
of Enel SpA | 378
Report of the independent audit firm on the 2015 financial state-
ments of Enel SpA | 386
Report of the independent audit firm on the 2015 consolidated
financial statements of the Enel Group | 390
Summary of the resolutions of the Ordinary and
Extraordinary Shareholders’ Meeting | 394
Attachments
Subsidiaries, associates and other significant equity investments
of the Enel Group at December 31, 2015 | 398
Report on Corporate Governance and Ownership Structure | 438
Enel organizational model | 8
Corporate boards | 9
Letter to shareholders and other stakeholders | 11
Summary of results | 14
Overview of the Group’s operations, performance
and financial position | 23
Results by business area | 35
Performance and financial position of Enel SpA | 73
Significant events in 2015 | 78
Reference scenario | 88
Main risks and uncertainties | 126
Outlook | 131
Other information | 132
Sustainability | 134
Related parties | 154
Reconciliation of shareholders’ equity and net income of Enel SpA
and the corresponding consolidated figures | 155
Consolidated financial statements
Financial statements | 158
Notes to the consolidated financial statements | 165
Declaration of the Chief Executive Officer and
the officer responsible for the preparation of
corporate financial reports | 304
Separate financial statements of Enel SpA
Financial statements | 308
Notes to the separate financial statements | 315
Declaration of the Chief Executive Officer and
the officer responsible for the preparation of the
Company financial reports | 374
3
ENEL IS
Open to the world, to technology and, internally, among our people. This
is the strategic concept of Open Power. But in order to transfer to our
customers and stakeholders the essence of a new innovative and open
Enel, it is essential to instill this approach to openness within the
Company.
In order to create a shared culture among all of the Group’s parts, we
have developed a “galaxy” composed of a Vision – for the first time in
Enel – which represents our major long-term objective, a Mission 2025
expressed in five points, the values that represent Enel’s DNA and ten
principles of conduct that must inspire everyone who works for the
Company. Let’s discover the Open Power galaxy.
Share information, being
willing to collaborate
and open to the contribution
of others.
Follow through with commitments,
pursuing activities
with determination and passion.
Work for the integration of all,
recognizing and leveraging individual
diversity (culture, gender, age,
disabilities, personality etc.).
Change priorities swiftly
in response to changes
in the context.
PRINCIPLES OF CONDUCT
VISION
OPEN POWER TO SOLVE THE GREATEST
CHALLENGES FACING OUR WORLD
VALUES
TRUST
INNOVATION
RESPONSIBILITY
PROACTIVITY
PROATTIVIÀ
Adopt and promote safe behavior
and move pro-actively to improve
conditions for health, safety and
well-being.
Make decisions in daily
activities and take responsibility
for them.
Your work is focused
on satisfying customers
and/or co-workers, acting
effectively and rapidly.
Propose new solution
and do not give up
when faced with
obstacles or failure.
Recognize merit in your
co-workers and give feedback
that can improve
their contribution.
Get results by aiming
for excellence.
4
MISSION
2025
OPEN
ACCESS TO
ELECTRICITY
FOR MORE
PEOPLE
OPEN THE WORLD
OF ENERGY TO
NEW TECHNOLOGY
OPEN UP TO
NEW USES
OF ENERGY
OPEN UP TO NEW
WAYS OF MANAGING
ENERGY FOR PEOPLE
OPEN UP
TO NEW
PARTNERSHIPS
Annual Report 2015 ENEL IS
Open to the world, to technology and, internally, among our people. This
is the strategic concept of Open Power. But in order to transfer to our
customers and stakeholders the essence of a new innovative and open
Enel, it is essential to instill this approach to openness within the
Company.
In order to create a shared culture among all of the Group’s parts, we
have developed a “galaxy” composed of a Vision – for the first time in
Enel – which represents our major long-term objective, a Mission 2025
expressed in five points, the values that represent Enel’s DNA and ten
principles of conduct that must inspire everyone who works for the
Company. Let’s discover the Open Power galaxy.
Share information, being
willing to collaborate
and open to the contribution
of others.
Follow through with commitments,
pursuing activities
with determination and passion.
Work for the integration of all,
recognizing and leveraging individual
diversity (culture, gender, age,
disabilities, personality etc.).
Change priorities swiftly
in response to changes
in the context.
PRINCIPLES OF CONDUCT
VISION
OPEN POWER TO SOLVE THE GREATEST
CHALLENGES FACING OUR WORLD
VALUES
TRUST
INNOVATION
RESPONSIBILITY
PROACTIVITY
PROATTIVIÀ
Adopt and promote safe behavior
and move pro-actively to improve
conditions for health, safety and
well-being.
Make decisions in daily
Your work is focused
Propose new solution
activities and take responsibility
on satisfying customers
and/or co-workers, acting
effectively and rapidly.
and do not give up
when faced with
obstacles or failure.
for them.
Recognize merit in your
co-workers and give feedback
Get results by aiming
for excellence.
that can improve
their contribution.
OPEN
ACCESS TO
ELECTRICITY
FOR MORE
PEOPLE
OPEN THE WORLD
OF ENERGY TO
NEW TECHNOLOGY
MISSION
2025
OPEN UP TO
NEW USES
OF ENERGY
OPEN UP TO NEW
WAYS OF MANAGING
ENERGY FOR PEOPLE
OPEN UP
TO NEW
PARTNERSHIPS
5
Annual Report 2015 Report on operations
6
Annual Report 2015 7
Report on operationsAnnual Report 2015 Enel organizational model
On July 31, 2014, the Enel Group adopted a new organizational structure, based on a matrix of divisions and geographical
areas, focused on the industrial objectives of the Group, with clear specification of roles and responsibilities in order to:
> pursue and maintain technological leadership in the sectors in which the Group operates, ensuring operational excellence;
> maximize the level of service offered to customers in local markets.
GLOBAL DIVISIONS
Global
Infrastructure
and Networks
Global
Generation
Renewable
Energy
Global
Trading
Upstream
Gas
Italy
Iberian
Peninsula
Latin
America
Eastern
Europe
S
E
I
R
T
N
U
O
C
/
S
N
O
G
E
R
I
• Implementation of best practices
• Efficiency in operating expenses and investments
• Capital allocation
• Gross operating margin
•
•
•
•
•
Customers
Local stakeholders
Revenue
Cash flow
Gross operating margin
Thanks to this organization, the Group can benefit from reduced complexity in the execution of management actions and
the analysis of key factors in value creation.
More specifically, the new Enel Group structure is organized into:
> Divisions (Global Generation, Global Infrastructure and Networks, Renewable Energy, Global Trading, Upstream Gas),
which are responsible for managing and developing assets, optimizing their performance and the return on capital em-
ployed in the various geographical areas in which the Group operates. The Divisions are also tasked with improving the
efficiency of the processes they manage and sharing best practices at the global level. The Group can benefit from a
centralized industrial vision of projects in the various business areas. Each project will be assessed not only on the basis
of its financial return, but also on the basis of the best technologies available at the Group level;
> Regions and Countries (Italy, Iberian Peninsula, Latin America, Eastern Europe), which are responsible for managing rela-
tionships with institutional bodies and regulatory authorities, as well as selling electricity and gas, in each of the countries
in which the Group is present, while also providing staff and other service support to the Divisions.
This matrix is sustained by general business support functions:
> Global service functions (Procurement and ICT), which are responsible for managing information and communication
technology activities and procurement at the Group level;
> Holding company functions (Administration, Finance and Control, Human Resources and Organization, Communication,
Legal and Corporate Affairs, Audit, European Affairs, and Innovation and Sustainability), which are responsible for mana-
ging governance processes at the Group level.
8
Annual Report 2015 Corporate boards
Board of Directors
Chairman
Chief Executive
Directors
Secretary
Patrizia Grieco
Manager
Officer and General
Francesco Starace
Claudio Sartorelli
Alfredo Antoniozzi
Alessandro Banchi
Alberto Bianchi
Paola Girdinio
Alberto Pera
Anna Chiara Svelto
Angelo Taraborrelli
Board of Auditors
Chairman
Auditors
Alternate auditors
Sergio Duca
Lidia D’Alessio
Gennaro Mariconda
Giulia De Martino
Pierpaolo Singer
Franco Luciano Tutino
Independent auditors
Reconta
Ernst & Young SpA
9
Report on operationsAnnual Report 2015 Powers
Board of Directors
The Board is vested by the bylaws with the broadest powers for the ordinary and extraordinary management
of the Company, and specifically has the power to carry out all the actions it deems advisable to implement
and attain the corporate purpose.
Chairman of the Board of Directors
The Chairman is vested by the bylaws with the powers to represent the Company and to sign on its behalf,
presides over Shareholders’ Meetings, convenes and presides over the Board of Directors, and ascertains
that the Board’s resolutions are carried out. Pursuant to a Board resolution of May 23, 2014, the Chairman
has been vested with a number of additional non-executive powers.
Chief Executive Officer
The Chief Executive Officer is also vested by the bylaws with the powers to represent the Company and to
sign on its behalf, and in addition is vested by a Board resolution of May 23, 2014 with all powers for manag-
ing the Company, with the exception of those that are otherwise assigned by law or the bylaws or that the
aforesaid resolution reserves for the Board of Directors.
10
Annual Report 2015 Letter to shareholders
and other stakeholders
Dear shareholders and stakeholders,
The year 2015 was marked by great changes and the achievement of significant results. The strategic decisions we
have taken have in fact enabled us to gain strength and resilience in a changing economic environment, while laying
the foundation for equally solid growth in the near future.
Strategy and outlook for 2016
In March, the new management presented its first strategic plan to the market. After the significant progress achieved
during the year, and following the decision to shift the presentation of the plan from March to November each year,
for 2015 only an update was subsequently presented. The new plan is focused closely on long-term industrial growth,
especially in renewables and networks. It sets out an ambitious program for enhancing efficiency through the reduc-
tion of maintenance and operating costs in all the global business lines in which our operations are now structured
following the reorganization undertaken in 2014.
The plan also envisages the simplification of the Enel Group’s corporate structure, which began in 2014 with the sepa-
ration of the two subsidiaries Endesa and Enersis. It also seeks to manage the Enel portfolio actively with a view to
creating value through the strategic repositioning of the Group. Finally, it provides for focusing growing attention on
shareholder remuneration, thanks to a gradual increase in dividends distributed through 2019 in order to align the Enel
Group more closely with the sector average.
The Enel strategic plan, which is updated each year, is a synthesis of the long-term vision of the Company. It is the fruit
of cooperation and exchange between management and the Board of Directors. The Board, after a process of sharing
information and analysis with management, is responsible for final approval of the strategic direction being pursued
and periodic monitoring of its implementation.
We sought to summarize the essence of this new strategic direction with the term “Open Power”, which represents
a new approach involving all of the Group’s industrial processes and commercial initiatives, guiding investments and
the relationship with stakeholders. It is in fact based on the concept of openness in terms of sustainability and, hence,
innovation and technological innovation at a time when the Enel Group is opening its infrastructure to a variety of other
uses: openness with stakeholders, through dialogue with the communities in which the Group operates; openness
within the Group, which means leveraging the talents and diversity among our people; and finally, openness as the
capacity to listen to the world around us and to seize the opportunities and meet the needs we find. Consistent with
this innovative approach, on January 26, 2016, in Madrid, Enel presented the new Group logo, a global brand that
represents openness to change, listening and innovation.
The macroeconomic environment
The global economic environment in 2015 was characterized by strong turbulence, marked by increased volatility in
the major financial markets and uncertainty about the outlook for the global economic recovery. Preliminary forecasts
of growth in global gross domestic product are below the average of the last 15 years. In the euro area, the combined
effects of the expansionary monetary policy instituted by the European Central Bank, together with the fall in com-
modity prices and the depreciation of the euro, point to faster expected growth than last year, although the outlook is
impacted by the weakness of the global economy and developments in the foreign exchange market.
11
Report on operationsAnnual Report 2015 The emerging economies are slowing, with a contraction in domestic demand, high inflation and the depreciation of
local currencies. Tensions on the financial market in China, combined with the prospects of a slowdown in the real
economy, have had an adverse impact on trade and, owing to a decline in expected use of commodities in industry
and construction, have contributed to the sharp decline in commodity prices, particularly oil.
Despite the slide in oil prices, investments in renewable energy around the world continued the positive trend of re-
cent years, reaching record levels in 2015. This trend will also continue in the coming years, irrespective of the volatility
in commodity prices that, in all probability, will also characterize the immediate future.
Performance
In spite of the complex macroeconomic environment, 2015 was a good year for Enel, as demonstrated by the excel-
lent performance we achieved: revenue of about €75.7 billion, essentially in line with 2014; ordinary EBITDA of €15.0
billion, a slight decrease compared with the €15.5 billion posted in 2014, but perfectly in line with the targets already
announced to the market; and ordinary net income of €2.9 billion. The decrease in EBITDA is essentially due to the
adverse evolution of exchange rates, the formalization of a number of agreements on early retirement incentives in
Italy and Spain – intended to achieve significant generational turnover – and the lower margin on the generation of
electricity from conventional resources. These factors were partly offset by efficiency gains and the positive impact of
regulatory and legislative changes in the countries in which we operate.
At the end of 2015, net financial debt stood at €37.5 billion, essentially in line with the figure reported at December 31,
2014. The cash flows generated by ordinary operations allowed us to finance almost all our investments in the period
and the payment of dividends, which were compounded by the negative effects of exchange rate changes.
Main events
The performance described above synthesizes the commitment of a year of hard work, one marked by a series of
major events.
In February 2015, the Ministry for the Economy and Finance carried out the fifth tranche of Enel’s privatization, an
operation that reduced the majority shareholder’s interest to 25.5%, down from the 31.2% held previously.
As regards industrial growth, 2015 saw the completion of construction and the entry into service of power plants with
a total capacity of 2,063 MW, of which 94% powered by renewable resources (including large hydroelectric facilities),
strengthening Enel’s leadership position in this important sector.
We also initiated sustainable growth in new countries (India, Kenya and Germany), pursuing our medium/
long-term strategy.
In 2015 we connected about 530,000 new users to our networks, expanding the number of customers served
around the world to 61.5 million, once again reinforcing Enel’s pre-eminent global position.
In Italy, we reached the significant threshold of 10 million customers served on the free markets for electricity
and gas.
Within the program for the active management of our asset portfolio, in 2015 we made disposals totaling about €1.6
billion, including a number of hydroelectric assets in Italy, minority stakes in renewables in the United States and
renewables assets in Portugal.
We also reached an agreement for the sale of our stake in Slovenské elektrárne, to be implemented in two tranches:
the first in 2016 and the second upon completion of the construction of the new 3 and 4 units at the Mochovce
nuclear power plant.
With regard to Italy in particular, 2015 saw the launch of Futur-E, a project for the redevelopment of generation plants
that have reached or are approaching the end their life cycle. Specifically, the project involves 23 thermal plants (with
a total of 13 GW of capacity) for which Enel intends to develop, together with all other stakeholders, sustainable solu-
tions to preserve jobs and, where possible, the productive and industrial vocation of the sites.
In other developments in Italy, we launched a number of initiatives that will have significant implications for the indus-
12
Annual Report 2015 trial growth of the country. The first is the plan to replace, over the next few years, some 32 million smart meters.
The project will enable the roll-out of innovative services with significant benefits for both customers and the entire
national electricity system. In addition, with the launch of a project that recently led to the establishment of the new
company Enel Open Fiber, we have laid the foundations for major infrastructure development (which could also be
replicated in other countries in the future): a national ultra-broadband network. The initiative is open to all interested
stakeholders and will contribute to digitizing the entire country by 2020, in line with national objectives.
Another important event was Expo 2015, an initiative in which Enel participated as an Official Global Partner, creating
the first greenfield smart city in the world and a showroom to showcase Enel’s most innovative technologies to the
some 800,000 visitors.
In order to simplify the Group’s corporate structure, we launched a restructuring program in Latin America. This
represents a key decision for the development of our business in that area: it provides for the separation of genera-
tion and distribution activities in Chile from those in other Latin American countries (Argentina, Brazil, Colombia and
Peru). It will allow us to eliminate existing duplication and overlap, improve the visibility of the various businesses and
countries, accelerate and streamline decision-making and maximize value creation.
In another step, at the end of 2015 we began the process of integrating Enel Green Power into Enel: this operation
enable us to increase the economic impact of the Group’s most important drive of growth in the coming years and
accelerate the development of the global renewables market. At the same time, it will improve synergies with the
rest the Group and add flexibility to the structure of the program for the structural rotation of assets.
Also in 2015, Enel was recognized – unique among utilities – by Fortune in the Change the World list as one of the
five companies capable of changing the world and was appointed to the Board of the Global Compact of the United
Nations. And as regards the new Sustainable Development Goals adopted by the United Nations, we wanted to
make an effective contribution to their achievement through the implementation of projects aimed at: i) ensuring
universal access to clean energy; ii) countering climate change and its effects; iii) supporting access to education;
and iv) contributing to the inclusive and sustainable economic growth of the communities in the countries in which
we operate. Enel, in a demonstration of its commitment to sustainable development, from the very outset integrated
those objectives into its strategy and in its sustainability reporting.
In 2016 Enel will complete the integration of Enel Green Power, the reorganization in Latin America, the start of
installation of smart meters, and the development of the business plan of Enel Open Fiber. These are solid projects
that well represent the pillars of our 2016-2019 strategic plan: improving operational efficiency, industrial growth,
simplifying the Group, active management of our asset portfolio and the remuneration of shareholders. These are the
foundations on which we are building the Enel of the future.
The Chairman of the Board of Directors
The Chief Executive Officer
Patrizia Grieco
Francesco Starace
13
Report on operationsAnnual Report 2015 Summary of results
billions of m3
TWh
Total net generation by resource
TWh
Gas
sales
8.9
Electricity
sales
260.1
Electricity
transported
417.4
Total net
generation
284.0
Abroad
4.8
Italy
4.1
Abroad
172.1
Abroad
190.8
Abroad
215.5
Renewables
31%
Coal
30%
Net generation by renewable resource
TWh
Nuclear
Combined
14%
cycle
and gas
15%
Oil and
gas turbine
10%
Italy
88.0
Italy
226.6
Italy
68.5
Capital expenditure by business area
millions of euro
Employees by business area
7,113
Wind
18%
Geothermal
7%
Biomass
and solar
1%
284.0
89.3
Hydroelectric
74%
67,914
Eastern Europe
Iberian Peninsula
Latin America
229
985
1,819
Italy
1,562
Renewable
Energy
2,466
Other, eliminations
and adjustments
52
Performance for 2015 (compared with 2014)
Eastern Europe
Iberian Peninsula
Latin America
Italy
Renewable
Other, eliminations
10,200
10,001
12,211
28,774
Energy
4,309
and adjustments
2,419
millions of euro
Revenue
75,658 -0.2%
1410
Gross operating margin
Operating income
15,297 -2.9%
7,685
Net income
3,372
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
Annual Report 2015 Summary of results
billions of m3
TWh
Total net generation by resource
TWh
Gas
sales
8.9
Electricity
sales
260.1
Electricity
transported
417.4
Total net
generation
284.0
284.0
Abroad
172.1
Abroad
190.8
Abroad
215.5
Renewables
31%
Coal
30%
Nuclear
14%
Combined
cycle
and gas
15%
Oil and
gas turbine
10%
Net generation by renewable resource
TWh
89.3
Hydroelectric
74%
Wind
18%
Geothermal
7%
Biomass
and solar
1%
Abroad
4.8
Italy
4.1
Italy
88.0
Italy
226.6
Italy
68.5
Capital expenditure by business area
millions of euro
Employees by business area
7,113
67,914
Eastern Europe
Iberian Peninsula
Latin America
229
985
1,819
Italy
1,562
Renewable
Other, eliminations
Energy
2,466
and adjustments
52
Eastern Europe
Iberian Peninsula
Latin America
Italy
10,200
10,001
12,211
28,774
Performance for 2015 (compared with 2014)
Renewable
Energy
4,309
Other, eliminations
and adjustments
2,419
millions of euro
Revenue
75,658 -0.2%
Gross operating margin
15,297 -2.9%
Operating income
7,685
Net income
3,372
10
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
15
Report on operationsAnnual Report 2015 Performance data
Revenue
Revenue in 2015 amounted to €75,658 million, a decrease
of €133 million (-0.2%) compared with 2014. The slight con-
traction is attributable to a decline in sales of electricity, part-
millions of euro
ly offset by greater revenue from the sale of fuels and gas.
2015
The increase in revenue in Italy, especially in distribution as
a result of regulatory changes concerning electricity trans-
2014
75,658
75,791
-0.2%
port (Resolutions 654/2015 and 655/2014 of the Authority for
Electricity, Gas and the Water System), and in Latin America,
especially owning to the effect of Resolución 32/2015 in Ar-
gentina and the acquisition, as from April 2014, of control of
Gas Atacama in Chile, partly offset the negative impact of
changes in the exchange rates of other local currencies, no-
tably in Brazil, Colombia and Russia, against the euro (equal
to about €773 million).
In addition, revenue in 2015 includes the gain of €141 million
on the disposal of SE Hydropower and the negative goodwill
and simultaneous remeasurement at fair value of the stake
already held by the Group following the acquisition of 3Sun
for a total of €116 million. During the same period of 2014,
revenue included the gain on the disposal of LaGeo (€123
million), the adjustment to the sales price (€82 million) on
the disposal of Artic Russia, which was carried out at the end
of 2013, and the remeasurement at fair value (€50 million) of
the net assets of SE Hydropower, a company over which the
Group lost control at the start of 2014.
Millions of euro
Italy
Iberian Peninsula
Latin America
Eastern Europe
Renewable Energy
Other, eliminations and adjustments
Total
2015
39,644
20,105
10,627
4,831
3,011
(2,560)
75,658
2014 restated
Change
38,389
20,952
9,648
5,299
2,921
(1,418)
75,791
1,255
(847)
979
(468)
90
(1,142)
(133)
3.3%
-4.0%
10.1%
-8.8%
3.1%
-80.5%
-0.2%
16
Annual Report 2015
15,297
15,757
-2.9%
Gross operating margin
The gross operating margin amounted to €15,297 million
millions of euro
in 2015, down 2.9% compared with 2014. More specifically,
in view of the fact that the effects of the extraordinary cor-
porate transactions cited above were essentially neutral, the
change reflected the adverse developments in exchange
rates, the formalization of a number of agreements in the
4th Quarter of 2015 for the early retirement of personnel
2015
2014
in Italy and Spain, and a decrease in the margin on electric-
ity from conventional generation. These effects were partly
offset by efficiency gains, a number or regulatory changes
with a positive impact on results and the new regulations
introduced in July 2015 in Slovakia that made it possible to
partially reverse the provision for charges for the disposal of
depleted nuclear fuel.
More specifically, fluctuations in the exchange rates of other
currencies with respect to the euro produced a net exchange
loss of about €107 million, the net balance of the deprecia-
tion of certain currencies (including the ruble, the Colombian
peso and the Brazilian real) and the appreciation of others
(notable the Chilean peso, the US dollar and the Peruvian
sol) against the euro.
Millions of euro
Italy
Iberian Peninsula
Latin America
Eastern Europe
Renewable Energy
Other, eliminations and adjustments
Total
2015
6,098
3,111
3,167
1,308
1,826
(213)
15,297
2014 restated
Change
6,343
3,203
3,092
1,210
1,938
(29)
15,757
(245)
(92)
75
98
(112)
(184)
(460)
-3.9%
-2.9%
2.4%
8.1%
-5.8%
-
-2.9%
17
Report on operationsAnnual Report 2015
Operating income
Operating income in 2015 amounted to €7,685 million, an
millions of euro
2015
7,685
2014
3,087
increase of €4,598 million compared with 2014 (€3,087 mil-
lion). In addition to a decline in depreciation and amortiza-
tion, the changes reflected a reduction in impairment losses
on property, plant and equipment and intangible assets. In
particular, the change mainly reflected the following con-
trasting factors:
> impairment of non-current assets in 2014, mainly regard-
ing generation in Italy, Slovakia and Russia and certain as-
sets in Spain, renewables assets in Greece, the tolling
agreement with Marcinelle Energie and the Aysén water
use rights for a total of about €6,427 million;
> impairment of non-current assets in 2015, mainly regard-
ing Russian generation and Romanian renewables assets
following changes in market and regulatory conditions,
and on Slovakian assets in order to align their carrying
amounts with their estimated realizable values, in addi-
tion to the impairment of the net assets of the upstream
gas area as a result of the difficulty in continuing projects
and the change in the price scenario in the global fuel
market, for a total of about €1,787 million.
These effects were partly offset by the contraction in the
gross operating margin.
Millions of euro
Italy
Iberian Peninsula
Latin America
Eastern Europe
Renewable Energy
Other, eliminations and adjustments
Total
2015
4,005
1,397
2,241
(499)
879
(338)
7,685
2014 restated
Change
1,918
1,240
1,549
(2,676)
1,124
(68)
3,087
2,087
157
692
2,177
(245)
(270)
4,598
-
12.7%
44.7%
-81.4%
-21.8%
-
-
18
Annual Report 2015
millions of euro
Earnings per share €0.23
2015
2,196
1,176
3,372
Earnings per share €0.05
2014
517
255
772
Non-controlling interests
Group
Net income
Net income attributable to shareholders of the Parent
Company amounted to €2,196 million in 2015, compared with
€517 million the previous year. More specifically, the increase in
operating income was accompanied by a decline in net financial
expense (mainly associated with a reduction in interest on debt
and a number of non-recurring items), only partly offset by an
increase in income taxes. The latter were affected by numerous
non-recurring items, including: a) an increase in deferred tax
assets recognized in 2014 by Enel Iberoamérica in the amount
of €1,392 million following the reorganization of investments in
Spain and Latin America; b) the tax benefits associated with the
elimination at the end of 2014 of the IRES (corporate income
tax) surtax (the so-called “Robin Hood Tax”); c) changes in the
deductibility of personnel costs for IRAP (regional business
tax) purposes; d) new tax regulations in Spain, Peru, Chile and
Colombia that had an impact on deferred taxation; and e) the
application of the new Italian Stability Act approved in December
2015, which reduces the IRES rate from 27.5% to 24% as from
January 1, 2017.
These factors were accompanied by the increase in the impact
of non-controlling interests, mainly due to the disposal of 21.92%
of Endesa in the 4th Quarter of 2014.
Financial data
Net capital employed
Net capital employed, including net assets held for sale
of €1,490 million (mainly Slovenské elektrárne), amounted
to €89,296 million at December 31, 2015 and was financed
by equity pertaining to shareholders of the Parent Company
millions of euro
Group equity
per share €3.44
Group equity
per share €3.35
2015
2014
+0.9%
and non-controlling interests of €51,751 million and net
37,545
51,751
89,296
debt/equity ratio came to 0.73 (0.73 at December 31, 2014).
financial debt of €37,545 million. At December 31, 2015, the
37,383
51,145
88,528
Net financial debt came to €37,545 million, an increase of
Equity (including non-
controlling interests)
Net financial debt
€162 million on December 31, 2014, reflecting the borrowing
generated by investment in the period, the payment of
dividends and developments in exchange rates.
19
Report on operationsAnnual Report 2015
Cash flows from
operations
millions of euro
Cash flows from operations amounted to €9,572 million,
down €486 million on the previous year.
2015
2014
9,572
10,058
Capital expenditure
millions of euro
Capital expenditure amounted to €7,113 million in 2015
(of which €6,353 million in respect of property, plant and
equipment), an increase of €412 million on 2014.
2015
2014
7,113
6,701
-4.8%
+6.1%
Millions of euro
Italy (1)
Iberian Peninsula
Latin America
Eastern Europe (2)
Renewable Energy
Other, eliminations and adjustments
Total
2015
1,562
985
1,819
229
2,466
52
7,113
2014 restated
Change
1,460
993
1,609
936
1,658
45
6,701
102
(8)
210
(707)
808
7
412
7.0%
-0.8%
13.1%
-75.5%
48.7%
15.6%
6.1%
(1) The figure does not include €1 million regarding units classified as “held for sale”.
(2) The figure does not include €648 million regarding units classified as “held for sale”.
Operations
Italy
Abroad
Total
Italy
Abroad
Total
2015
2014
Net electricity generated by Enel (TWh)
68.5
215.5
284.0
71.8
211.3
283.1
Electricity transported on the Enel distribution network
(TWh)
Electricity sold by Enel (TWh) (1)
Gas sold to end users (billions of m3)
Employees at year-end (no.) (2)
226.6
88.0
4.1
190.8
172.1
4.8
417.4
260.1
8.9
223.0
87.6
3.5
188.1
173.4
4.3
411.1
261.0
7.8
33,040
34,874
67,914
33,405
35,556
68,961
(1) Excluding sales to resellers.
(2) Includes 4,301 in units classified as “held for sale” at December 31, 2015 (4,486 at December 31, 2014).
20
Annual Report 2015
Net electricity generation
by source (2015)
Net electricity generated by Enel in 2015 increased by
0.9 TWh compared with 2014 (+0.3%). More specifically,
15%
the rise attributable to greater generation abroad (+4.2 TWh)
14%
10%
is largely accounted for by greater conventional thermal ou-
31%
tput, only partly offset by a decline in renewables genera-
tion, which in 2015 was affected by a decline in resource
availability. Finally, 31% of the electricity generated by Enel
in 2015 came from renewable sources (34% in 2014).
30%
Electricity transported on the Enel distribution net-
Renewables
Coal
Oil and gas turbine
Nuclear
Combined cycle and gas
work in 2015 amounted to 417.4 TWh, up 6.3 TWh (+1.5%),
mainly reflecting an increase in electricity demand in Spain
and Latin America, with the exception of Brazil.
Electricity sold by geographical
area (2015)
Electricity sold by Enel in 2015 amounted to 260.1 TWh, a
decrease of 0.9 TWh (-0.3%) compared with 2014.
6%
A decline in sales in the Iberian Peninsula, reflecting the
24%
34%
36%
Italy
Iberian Peninsula
Latin America
Other countries
ongoing shift of customers to the free market, was only
partly offset by the rise in amounts sold in Italy and in Latin
America.
At December 31, 2015, Enel Group employees numbered
67,914. The decrease of 1,047 on the end of 2014 is attri-
butable to the net balance of new hires and terminations
(-1,316), partly offset by the change in the scope of conso-
lidation (+269).
Employees (no.)
Italy (1)
Iberian Peninsula
Latin America (2)
Eastern Europe (3)
Renewable Energy
Other, eliminations and adjustments
Total
2015
28,774
10,001
12,211
10,200
4,309
2,419
67,914
2014 restated
29,656
10,500
12,301
10,411
3,609
2,484
68,961
(1) Of which 41 in units classified as “held for sale” at December 31, 2014.
(2) Of which 15 in units classified as “held for sale” at December 31, 2014.
(3) Of which 4,301 in units classified as “held for sale” at December 31, 2015 (4,430 at December 31, 2014).
21
Report on operationsAnnual Report 2015 Environmental, social and governance
indicators
ISO 14001-certified net efficient capacity (% of total)
Average efficiency of thermal plants (%) (1)
Total specific emissions of CO2 from net generation
(gCO2/kWheq) (2)
“Zero-emission” generation (% of total)
Enel injury frequency rate (3)
Enel injury severity rate (4)
Serious and fatal injuries at Enel
Serious and fatal injuries at contractors
Verified violations of the Code of Ethics (5)
2015
97.6
38.1
409
45.5
1.27
0.05
7
33
32
2014
94.3
37.8
395
47.4
1.32
0.07
4
38
31
Change
3.3
0.3
14
(1.9)
(0.05)
(0.02)
3
(5)
1
3.5%
0.8%
3.5%
-4.0%
-3.8%
-33.4%
75.0%
-13.2%
3.2%
(1) Percentages calculated using new method that does not consider oil and gas plants in Italy that are included in the 2015-2016 disposal program and heat.
(2) Specific emissions are calculated as total emissions from simple thermal generation and co-generation of electricity and heat as a ratio of total renewables
generation, nuclear generation, simple thermal generation and co-generation of electricity and heat (including the contribution of heat in MWh equivalent).
(3) The indicator is calculated as the ratio between the total number of injuries and the number of hours worked, in millions (INAIL standard).
(4) The indicator is calculated as the ratio between the number of days lost for injuries and the number of hours worked, in thousands (INAIL standard).
(5) The analysis of reports received in 2014 was completed in 2015. For that reason, the number of verified violations for 2014 was restated from 27 to 31.
Currently, more than 45% of Enel generation output comes
last two years, going from 37.8% in 2014 to 38.1% in 2015.
from zero-emission resources. In 2015 Enel Green Power
The proportion of ISO 14001-certified net efficient capa-
installed about 870 MW of new wind capacity, mainly in
city was equal to 97.6%, an increase compared with 2014
the United States, Mexico, Brazil and our new country Uru-
thanks to the new installed capacity of Enel Green Power
guay, reaching a total installed capacity for renewable re-
and the exit of marginal plants, mainly in Italy.
sources of 37,033 MW. This confirms the Group’s commit-
Injury frequency and severity rates for employees of the
ment to the development of carbon-free generation, which
Enel Group were equal to 1.27 (down about 4% compa-
will continue in the coming years.
red with 2014) and 0.05 (down about 33% on the previous
With the additional increase in renewables generation envi-
year), respectively.
saged in the plan, Enel confirms its objective for achieving
In 2015 there were 7 serious and fatal injuries involving
carbon neutrality by 2050, with an intermediate target at
Enel personnel (3 more than in 2014) and 33 serious and fa-
2020 of reducing emissions by 25% compared with 2007.
tal injuries involving the employees of contractors working
This goal has been recognized as a “Science Based Target”
for Enel (5 fewer compared with 2014).
as it is in line with global climate targets. This downward
The management of reported violations of the Code of
trend was interrupted by a temporary increase of 3.5% in
Ethics was revised to ensure greater transparency and
CO2 emissions as a result of greater use of thermal gene-
ration assets in order to offset, together with greater wind
traceability and to standardize assessment systems at the
Group level while ensuring appropriate assessment times.
generation, the reduction in expected hydroelectric genera-
The new process also improved the preliminary analysis of
tion owing to poor rainfall during the year.
reports received, which numbered 124 in 2015, of which 32
The average yield of thermal plants was unchanged in the
were classified as violations.
22
Annual Report 2015
Overview of the Group’s
operations, performance and
financial position
Definition of
performance
indicators
- “Long-term borrowings”;
- “Employee benefits”;
- “Provisions for risks and charges”;
- “Deferred tax liabilities”.
> Net current assets: calculated as the difference between
In order to present the results of the Group and the Parent
“Current assets” and “Current liabilities” with the excep-
Company and analyze its financial structure, Enel has pre-
tion of:
pared separate reclassified schedules that differ from those
- “Long-term financial receivables (short-term portion)”,
envisaged under the IFRS-EU adopted by the Group and
“Receivables for factoring advances”, “Securities”, “Fi-
Enel SpA and presented in the consolidated and separate
nancial receivables and cash collateral” and “Other fi-
financial statements, respectively. These reclassified sche-
nancial receivables”;
dules contain different performance indicators from those
- “Cash and cash equivalents”;
obtained directly from the consolidated and separate fi-
- “Short-term borrowings” and the “Current portion of
nancial statements, which management feels are useful in
long-term borrowings”.
monitoring Group and Parent Company performance and
representative of the financial performance of our business.
> Net assets held for sale: calculated as the algebraic sum of
In accordance with Recommendation CESR/05-178b publi-
“Assets held for sale” and “Liabilities held for sale”.
shed on November 3, 2005, the criteria used to calculate
these indicators are described below.
> Net capital employed: calculated as the algebraic sum of
“Net non-current assets” and “Net current assets”, provi-
> Gross operating margin: an operating performance indica-
sions not previously considered, “Deferred tax liabilities”
tor, calculated as “Operating income” plus “Depreciation,
and “Deferred tax assets”, as well as “Net assets held for
amortization and impairment losses”.
sale”.
> Group net ordinary income: this is Group net income produ-
> Net financial debt: a financial structure indicator, determi-
ced by ordinary operations.
ned by “Long-term borrowings”, the current portion of
such borrowings and “Short-term borrowings” less “Cash
> Net non-current assets: calculated as the difference betwe-
and cash equivalents”, “Current financial assets” and
en “Non-current assets” and “Non-current liabilities” with
“Non-current financial assets” not previously considered
the exception of:
- “Deferred tax assets”;
in other balance sheet indicators. More generally, the net
financial debt of the Enel Group is calculated in conformity
- “Securities held to maturity”, “Financial investments in
with paragraph 127 of Recommendation CESR/05-054b
funds or portfolio management products at fair value
implementing Regulation 2004/809/EC and in line with the
through profit or loss”, “Securities available for sale”
CONSOB instructions of July 26, 2007, net of financial re-
and “Other financial receivables”;
ceivables and long-term securities.
23
Report on operationsAnnual Report 2015 Main changes in the scope of consolidation
In the two periods under review, the scope of consolidation
information, please see note 5 in the notes to the consolida-
changed as a result of a number of transactions. For more
ted financial statements.
2014
Change
(133)
720
393
(460)
(5,058)
4,598
692
18
674
87
5,359
2,759
2,600
-
2,600
1,679
921
-0.2%
1.2%
-
-2.9%
-39.9%
-
20.8%
0.3%
21.5%
-
-
-
-
-
-
-
-
Group performance
Millions of euro
Total revenue
Total costs
Net income/(expense) from commodity contracts measured at fair value
Gross operating margin
Depreciation, amortization and impairment losses
Operating income
Financial income
Financial expense
2015
75,658
60,529
168
15,297
7,612
7,685
4,018
6,474
75,791
59,809
(225)
15,757
12,670
3,087
3,326
6,456
Total financial income/(expense)
(2,456)
(3,130)
Share of income/(losses) of equity investments accounted for using the
equity method
Income before taxes
Income taxes
Net income from continuing operations
Net income from discontinued operations
Net income (Group and non-controlling interests)
Net income attributable to shareholders of the Parent Company
Net income attributable to non-controlling interests
52
5,281
1,909
3,372
-
3,372
2,196
1,176
(35)
(78)
(850)
772
-
772
517
255
24
Annual Report 2015
Revenue
Millions of euro
Revenue from the sale of electricity
Revenue from the transport of electricity
Fees from network operators
Transfers from equalization funds, market operators and energy services
operators
Revenue from the sale of gas
Revenue from the transport of gas
Gains on disposal and negative goodwill on acquisitions of subsidiaries,
associates, joint ventures, joint operations and non-current assets held for sale
Remeasurement at fair value after changes in control
Gains on the disposal of property, plant and equipment and intangible assets
Other sales, services and revenue
Total
2015
46,638
9,911
826
1,152
4,045
509
313
80
52
12,132
75,658
2014
48,062
9,142
783
1,857
3,628
459
292
82
32
11,454
75,791
Change
(1,424)
769
43
(705)
417
50
21
(2)
20
678
(133)
-3.0%
8.4%
5.5%
-38.0%
11.5%
10.9%
7.2%
-2.4%
62.5%
5.9%
-0.2%
In 2015 revenue from the sale of electricity amounted to
Revenue from transfers from equalization funds, market
€46,638 million, down €1,424 million on the previous year
operators and energy services operators came to €1,152
(-3.0%). This decrease is mainly due to the following factors:
million in 2015, down €705 million compared with the same
> a reduction of €1,073 million in wholesale electricity
period of the previous year. More specifically, the reduction
sales, mainly due to a decline in revenue from sales in
is mainly concentrated in the extra-peninsular area of Spain,
Russia as a result of the depreciation of the ruble with
where joint impact of higher sales and the drop in fuel prices
respect to the euro and to a decrease in quantities sold
more than offset the effects of certain prior-year items reco-
on national electricity exchanges;
gnized in 2014 following regulatory changes.
> an increase of €61 million in revenue from electricity sa-
les to end users, essentially attributable to higher reve-
Revenue from the sale of gas in 2015 amounted to €4,045
nue from free markets in Spain and Latin America (parti-
million, an increase of €417 million (+11.5%) on the previous
cularly in Brazil and Chile as a result of the combination of
year. The change essentially reflects the greater revenue ge-
higher volumes sold and favorable developments in the
nerated in the Iberian Peninsula and on the domestic market
Chilean peso exchange rate), partially offset by a decrea-
as a result of the sharp increase in volumes, despite the
se in revenue in Italy. More specifically, revenue on free
decline in average unit prices.
markets rose by €368 million in 2015, only partly offset
by a reduction of €307 million in revenue on regulated
Revenue from the transport of gas amounted to €509 mil-
markets;
lion in 2015, an increase of €50 million (+10.9%), following a
> a decrease of €412 million in revenue from electricity tra-
similar pattern to that for sales of gas.
ding, reflecting a decline in volumes handled.
The item gains and negative goodwill in 2015 totaled €313
Revenue from the transport of electricity amounted to
million, an increase of €21 million (+7.2%), mainly relating
€9,911 million in 2015, an increase of €769 million. The rise
to the disposal of SE Hydropower (€141 million), the dispo-
mainly reflected developments in the Italian market as a
sal of SF Energy (€15 million) and the negative goodwill in
result of regulatory changes implemented with Resolution
the acquisition of control of 3Sun (€76 million). In 2014, the
654/2015 of the Autority for Electricity, Gas and the Water
item primarily regarded the price adjustment on the sale of
System (the “Authority“), which eliminated the time lag, as
Artic Russia (€82 million) following satisfaction of the condi-
well as the positive impact of an increase in transmission
tions provided for in the earn-out clause of the agreements
rates as a result of Authority Resolution 655/2014, which
with the buyer prior to completion of the sale and a number
updated rates for electricity transmission, distribution and
gains realized by Enel Green Power, mainly on the disposal
metering rates for residential customers for 2015.
of LaGeo (€123 million) and Enel Green Power France (€31
million).
25
Report on operationsAnnual Report 2015
Gains from remeasurement at fair value after changes in
previous year) for an increase of €678 million (+5.9%).
control in 2015 came to €80 million (€82 million in 2014).
The rise is mainly attributable to:
More specifically, the gains for 2015 refer to the adjustment
> an increase of €1,452 million in revenue from fuel sales
to their current value of assets and liabilities pertaining to
for trading, including revenue for shipping services, es-
the Group already held by Enel prior to the acquisition of
sentially due to the increase in volumes sold in interna-
full control of 3Sun (€40 million) and the ENEOP consortium
tional markets;
(€29 million). In 2014 this item referred to the adjustment
> a decrease of €945 million resulting from a contraction in
to their fair value of assets and liabilities pertaining to the
revenue from the sale of environmental certificates and a
Group (i) following the loss of control, as from January 1,
decrease in the grants received for them;
2014, of SE Hydropower as a result of changes in governan-
> the regulatory changes in Argentina introduced by Reso-
ce arrangements (€50 million) and (ii) held by Enel prior to
lución 32/2015 concerning the recognition of revenue on
the acquisition of full control of Inversiones Gas Atacama
the basis of a theoretical framework and the Mecanismo
(€29 million) and Buffalo Dunes Wind Project (€3 million).
de Monitoreo de Costos, which increased revenue by
€247 million compared with 2014;
Gains on the disposal of property, plant and equipment
> €98 million in negative goodwill, of which €76 million on
and intangible assets in 2015 amounted to €52 million (€32
the acquisition of 3Sun and €11 million from the definiti-
million in 2014) and mainly regard ordinary disposals during
ve allocation of the fair value of the assets acquired and
the period.
the liabilities and contingent liabilities assumed in South
Revenue under other sales, services and revenue
amounted to €12,132 million in 2015 (€11,454 million in the
Africa.
Costs
Millions of euro
Electricity purchases
Consumption of fuel for electricity generation
Fuel for trading and gas for sale to end users
Materials
Personnel
Services, leases and rentals
Other operating expenses
Capitalized costs
Total
2015
22,218
5,570
10,087
1,078
5,313
15,148
2,654
(1,539)
60,529
2014
23,317
5,944
7,909
2,275
4,864
14,662
2,362
(1,524)
59,809
Change
(1,099)
(374)
2,178
(1,197)
449
486
292
(15)
720
-4.7%
-6.3%
27.5%
-52.6%
9.2%
3.3%
12.4%
-1.0%
1.2%
Costs for electricity purchases in 2015 fell by €1,099
Costs for the purchase of fuel for trading and gas for sale
million compared with 2014, representing a contraction of
to end users came to €10,087 million in 2015, an increase
4.7%. This development mainly reflects the impact of the
of €2,178 million on 2014. The change mainly reflects the
decline in purchases through bilateral contracts on national
trading on commodity markets mentioned above in the di-
and international markets (€972 million in 2015) and a re-
scussion of revenue, as well as the need to cover the incre-
duction in costs for purchases of electricity on electricity
ase in volumes for sale to end users.
exchanges (€223 million).
Costs for the consumption of fuel for electricity genera-
decrease of €1,197 million on 2014. The decrease is mainly
tion amounted to €5,570 million in 2015, down €374 million
(-6.3%) on the previous year, reflecting the lower average
attributable to the contraction in provisioning of CO2 allo-
wances and green certificates in connection with the decre-
Costs for materials in 2015 amounted to €1,078 million, a
unit prices of fuels, which more than offset the increase in
ase in those markets.
consumption due to the rise in thermal generation.
26
Annual Report 2015
Personnel costs in 2015 totaled €5,313 million, an increase
Other operating expenses in 2015 amounted to €2,654
of 9.2% on 2014. The change essentially refers to:
million, an increase of €292 million compared with 2014.
> the increase in costs for early retirement incentives under
They essentially reflect:
the new agreements for early termination signed in Italy
> an increase in provisioned charges (€328 million) for
in December 2015, in accordance with Article 4 of Law
compensation to Italian retired employees for the uni-
92/2012 (€1,128 million, including the impact of those
lateral revocation of the electricity discount as from De-
agreements on other employee benefits), as well as the
cember 31, 2015;
increase in costs (€90 million) due to the introduction of
> an increase in provisions by Spanish generators in re-
early retirement incentives in the two years in Spain (Plan
spect of the abandonment of the Hidromondego project
de Salida);
> the reversal (€902 million) of the provision for electricity
(about €46 million) and greater charges for CO2 allowan-
ces (€56 million) as a result of an increase in emissions
discounts for former Italian employees as a result of the
in 2015. The impact was only partly offset by a reduction
unilateral revocation of the benefit in the 4th Quarter of
in the price of EUAs during the year;
2015;
> a decrease in expenses (€45 million) associated with the
> an increase in costs in Latin America associated with lar-
Bono social charged to the Spanish electricity compa-
ger average workforces and the increase in average unit
nies following the issue of Ministerial Order 350/2014;
costs. The rise was particularly large in Argentina due to
> the reversal of provisions for risks and charges (€136 mil-
the renewal of the local collective bargaining agreement;
lion) recognized at the end of 2014 in Slovakia;
> a reduction in the average workforces in Italy and Spain,
> the reversal of provisions for risks and charges (€63 mil-
in part attributable to the early retirement incentives intro-
lion), initially recognized in the first nine months of 2014,
duced in previous years.
following the settlement agreement between Enel Di-
The Enel Group workforce at December 31, 2015 numbe-
stribuzione, A2A and A2A Reti Elettriche;
red 67,914, of whom 34,874 abroad. The Group workforce
> an increase in charges for Enel Distribuzione (€207 mil-
fell by 1,047 during 2015, reflecting the negative balance
lion) in respect of energy efficiency certificates as a re-
between new hires and terminations (-1,316 employees)
sult of increased purchases to meet compliance require-
and the change in the scope of consolidation (+269 emplo-
ments and, above all, the regulatory change provided for
yees), the latter mainly attributable to the acquisition of an
in Authority Resolution 13/2014 introducing a new cost
additional 66% of 3Sun (which gave the Group full control
coverage mechanism;
of the company and led to line-by-line consolidation) and
> the reversal of the nuclear waste disposal provision
the acquisition of a majority stake in the Indian company
in Slovakia in the amount of €550 million following an
BLP Energy, as well as the disposal of ENEOP and other
analysis by independent experts, who took account of
Portuguese renewables companies.
the regulatory changes introduced in July 2015 by the
The overall change compared with December 31, 2014 bre-
Slovakian government, which approved a new strategy
aks down as follows.
for handling the “back end” of spent nuclear fuel.
Balance at December 31, 2014
68,961
In 2015 capitalized costs amounted to €1,539 million, with
2,695
developments in line with the previous year.
Hirings
Terminations
Change in scope of consolidation
Balance at December 31, 2015
(4,011)
269
67,914
Costs for services, leases and rentals in 2015 amounted
to €15,148 million, an increase of €486 million compared
with 2014. The change during the period essentially reflects
a rise in wheeling costs (€139 million), network access costs
(€129 million in 2015) and other services connected with the
electricity business (€83 million).
Net income/(expense) from commodity contracts me-
asured at fair value showed net income of €168 million
in 2015 (net expense of €225 million in the previous year).
More specifically, the net income for 2015 was essentially at-
tributable to net realized income in the period totaling €472
million (€43 million in 2014) and net unrealized charges from
the fair value measurement of derivatives positions open at
the end of the period in the amount of €304 million (€268
million in 2014).
27
Report on operationsAnnual Report 2015 Depreciation, amortization and impairment losses in
ces provided under concession arrangements in Brazil
2015 amounted to €7,612 million, a decrease of €5,058
and the impairment recognized in 2014 on the financial
million. The decrease is essentially attributable to the im-
receivable due from Elcogas, as well as greater capita-
pairment losses recognized to align the value of net assets
lized interest expense due in part to the increase in in-
“held for sale” to their estimated realizable value. More
vestments.
specifically, while in 2014 such impairment totaled €6,427
million (essentially in respect of generation plants in Italy,
The share of income/(losses) of equity investments ac-
Russia and Slovakia as well as water use rights in the Aysén
counted for using the equity method in 2015 showed net
region in Chile), the impairment losses recognized in 2015
income of €52 million.
regarded the Enel Russia CGU (€899 million), the Enel Gre-
en Power Romania CGU (€155 million), upstream gas explo-
Income taxes in 2015 amounted to €1,909 million, equal to
ration assets (€159 million) and Slovenské elektrárne (€574
36.1% of taxable income (compared a net tax creditor po-
million), the latter to realign the carrying amount with esti-
sition of €850 million in 2014). The increase in taxes in 2015
mated realizable value.
on the previous year essentially reflects (in addition to the
These effects were compounded by a reduction in deprecia-
greater pre-tax income):
tion and amortization in the amount of €317 million, reflec-
> a decrease of €197 million in net deferred tax assets as
ting developments in exchange rates and the reduction in
a result of the provisions of the Stability Act approved in
the carrying amounts due to impairment losses, only partly
December 2015;
offset by the increase in net writedowns of trade receivables
> the positive impact of the recognition in the 4th Quarter
totaling €68 million.
of 2014 of a tax credit of €1,392 million in respect of the
distribution of dividends by Endesa in the 4th Quarter,
Operating income in 2015 amounted to €7,685 million, an
as well as the tax effect of the significant impairment
increase of €4,598 million.
losses recognized the previous year;
partly offset by:
Net financial expense amounted to €2,456 million, a decre-
> the negative impact in 2014 (€280 million) of the increa-
ase of €674 million. This mainly reflected:
se in tax rates (progressively from 20% to 27% in 2018)
> a decrease of €129 million in net interest, essentially due
under the tax reform in Chile, which led to an adjustment
to a reduction in average net financial debt;
of net deferred taxation;
> an increase of €236 million in net exchange losses as a
> in Italy, the benefits (€200 million) of the ruling of uncon-
result of exchange rate developments;
stitutionality at the end of 2014 of the IRES surtax (the
> an increase of €452 million in net income from financial
so-called Robin Hood Tax) and the positive impact (€50
derivatives (to hedge interest rates and exchange rates);
million) of the changes in the deductibility of personnel
> a decrease of €86 million in interest expense in respect
costs for IRAP purposes, the essential exemption from
of the accretion of provisions for employee benefits and
tax of the gains on the disposals of SE Hydropower and
early retirement incentives;
SF Energy and the change in the IRES rate from 27.5%
> a decrease of €240 million in other net financial expen-
to 24% as from 2017;
se, mainly reflecting the negative adjustment in 2014 of
> the change in the tax rate in Spain from 30% to 28%.
the financial assets recognized in respect of the servi-
28
Annual Report 2015 Analysis of the Group’s financial position
Millions of euro
Net non-current assets:
- property, plant and equipment and intangible assets
- goodwill
- equity investments accounted for using the equity method
- other net non-current assets/(liabilities)
Total net non-current assets
Net current assets:
- trade receivables
- inventories
- net receivables due from equalization funds, market operators
and energy services operators
- other net current assets/(liabilities)
- trade payables
Total net current assets
Gross capital employed
Sundry provisions:
- employee benefits
- provisions for risks and charges and net deferred taxes
Total provisions
Net assets held for sale
Net capital employed
Total shareholders’ equity
Net financial debt
at Dec. 31, 2015
at Dec. 31, 2014
Change
88,686
13,824
607
1,092
104,209
12,797
2,904
(4,114)
(5,518)
(11,775)
(5,706)
98,503
(2,284)
(8,413)
(10,697)
1,490
89,296
51,751
37,545
89,844
(1,158)
14,027
872
(741)
104,002
(203)
(265)
1,833
207
-1.3%
-1.4%
-30.4%
-
0.2%
12,022
775
6.4%
3,334
(430)
-12.9%
(2,994)
(1,120)
-37.4%
(4,827)
(691)
-14.3%
(13,419)
1,644
12.3%
(5,884)
98,118
178
385
3.0%
0.4%
(3,687)
1,403
38.1%
(7,391)
(1,022)
-13.8%
(11,078)
1,488
88,528
51,145
37,383
381
2
768
606
162
3.4%
-
0.9%
1.2%
0.4%
Property, plant and equipment and intangible assets (inclu-
companies (Altomonte, Enel Green Power Strambino Solar
ding investment property) came to €88,686 million at De-
and Enel Green Power San Gillio) from the scope of conso-
cember 31, 2015, a decrease of €1,158 million. The decli-
lidation.
ne is essentially attributable to depreciation, amortization
and impairment losses for the year (€5,974 million) and the
Goodwill amounted to €13,824 million, a decrease of €203
negative impact of the translation of financial statements
million on December 31, 2014. The change is essentially due
prepared in foreign currencies (€2,455 million), which was
to the disposal of the Portuguese companies of the Rene-
especially significant for the Colombian peso, the Brazilian
wable Energy Division (€257 million) and to the impairment
real and the Russian ruble. These factors were only partly
losses on the goodwill of Enel Green Power Romania (€13
offset by capital expenditure for the year (€7,713 million) and
million) recognized as a result of the adverse market and
the changes in the scope of consolidation (€238 million). The
regulatory scenario in that country. These decreases were
latter essentially reflects the acquisition of control of 3Sun,
partly offset by the positive effects of the adjustment at cur-
BLP Energy (an Indian renewables generator) and a number
rent exchange rates of goodwill denominated in currencies
of smaller companies operating in renewables generation in
other than the euro (€51 million), which was especially pro-
the United States. These effects were only partly offset by
nounced for the US dollar, as well as the recognition of €6
the disposal of the Portuguese companies of the Renewable
million in goodwill from the acquisition of control of a number
Energy Division and the exit of the Italian solar generation
of companies in Mexico by the Renewable Energy Division.
29
Report on operationsAnnual Report 2015
Equity investments accounted for using the equity method
than offset by the recognition of current taxes (net of
amounted to €607 million, a decrease of €265 million com-
adjustments of prior years) amounting to €2,042 mil-
pared with the end of the previous year. The decline mainly
lion;
reflects the reclassification under assets held for sale of
- a decrease in other net current liabilities of €333 mil-
Hydro Dolomiti Enel, the distribution of dividends and the
lion, of which €241 million as a result of the payment
disposal of the Portuguese company ENEOP, which was
of liabilities connected with dividends to be disbursed
classified under this item in 2014. These factors were partly
recognized in 2014, mainly in respect of the Colombian
offset by the portion of the net income reported by compa-
companies;
nies accounted for using the equity method attributable to
- a decrease in net current financial assets of €363 mil-
the Group.
lion, essentially reflecting the decline in the fair value
of derivatives, only partly offset by an increase in net
Other net non-current assets at December 31, 2015
prepaid financial expense;
amounted to €1,092 million, an increase of €1,833 million
- an increase in other net tax payables other than income
on December 31, 2014 (net liabilities of €741 million).
tax of €156 million, essentially in respect of taxes and
The change is mainly attributable to the increase of €1,931
surtaxes on the consumption of electricity and gas;
million in the net assets in respect of cash flow hedge deri-
> a decrease in trade payables of €1,644 million, mainly in
vatives and the increase of €41 million in the value of other
Italy and partly reflecting the decrease in costs for the
equity investments, including the adjustment to fair value of
purchase of electricity and materials.
the investment in Bayan Resources. These factors were only
partly offset by the decline of €37 million in financial assets
Sundry provisions amounted to €10,697 million, a decrea-
in respect of service concession arrangements.
se of €381 million on the previous year. The decline essen-
tially reflected the following factors:
Net current assets came to a negative €5,706 million at De-
> a decrease of €1,403 million in the provision for post-
cember 31, 2015, a decrease of €178 million on December
employment and other employee benefits, mainly due to
31, 2014. The change is attributable to the following deve-
the unilateral revocation of the energy discount benefit
lopments:
for retired Italian employees as from December 31, 2015;
> an increase in trade receivables of €775 million, mainly
> an increase of €1,559 million in provisions for risks and
due to the changes in a number of collection policies
charges, largely attributable to provisions for early retire-
compared with 2014 and the effects of Authority Reso-
ment incentives following the new agreement reached on
lution 654/2015, which produced an increase in revenue
early terminations, which was signed in December 2015,
from electricity transport and the associated receivables;
in accordance with Article 4 of Law 92/2012 in Italy, the
> a decrease in inventories of €430 million, largely attributa-
introduction of a new early retirement incentive scheme
ble to a decline in inventories of green certificates (€216
(Plan de Salida) in Spain, and the granting of a lump-sum
million) and stocks of gas and other fuels (€217 million) as
benefit under the agreements with the trade unions for
a result of a decline in average prices;
the former beneficiaries of the energy discount benefit
> a decrease in net receivables due from equalization fun-
in Italy;
ds, market operators and energy services operators of
> a decrease of €513 million in net deferred tax liabilities,
€1,120 million, mainly in Italy, following Authority Re-
mainly due to exchange differences on the net deferred
solution 268/2015 (the “Grid Code”), which establishes
tax liabilities of companies with a currency other than the
a different methodology for determining the A and UC
euro and the partial reversal of net receivables for defer-
rate components. Another factor was the decrease in net
red tax assets following the change in the IRES rate in
receivables deriving from the application of equalization
Italy from 27.5% to 24% as from January 1, 2017, as esta-
mechanisms to electricity purchases;
blished in the 2016 Stability Act.
> a decrease in other current assets less related liabilities of
€691 million. This was attributable to:
Net assets held for sale amounted to €1,490 million at De-
- a decrease in net income tax receivables of €485 mil-
cember 31, 2015 (€1,488 million at December 31, 2014). They
lion, essentially associated with the payment of income
include the net assets, valued at their estimated realizable
taxes in the amount of €1,516 million, which was more
value on the basis of the current status of negotiations, of
30
Annual Report 2015
Slovenské elektrárne, Hydro Dolomiti Enel, Compostilla and
other net assets of smaller companies, which, in view of the
decisions taken by management, meet the requirements of
IFRS 5 for classification as assets held for sale. SE Hydropo-
wer and SF Energy, which were classified under this account
the previous year, were sold during the year.
Net capital employed at December 31, 2015 amounted to
€89,296 million and was funded by shareholders’ equity at-
tributable to the shareholders of the Parent Company and
non-controlling interests in the amount of €51,751 million
and net financial debt of €37,545 million. At December 31,
2015, the debt/equity ratio was 0.73 (0.73 at December 31,
2014).
31
Report on operationsAnnual Report 2015 Analysis of the Group’s financial structure
Net financial debt
Net financial debt and changes in the period are detailed in the table below.
Millions of euro
Long-term debt:
- bank borrowings
- bonds
- other borrowings
Long-term debt
Long-term financial receivables and securities
Net long-term debt
Short-term debt:
Bank borrowings:
- short-term portion of long-term bank borrowings
- other short-term bank borrowings
Short-term bank borrowings
Bonds (short-term portion)
Other borrowings (short-term portion)
Commercial paper
Cash collateral and other financing on derivatives
Other short-term financial payables
Other short-term debt
Long-term financial receivables (short-term portion)
Factoring receivables
Financial receivables and cash collateral
Other short-term financial receivables
Cash and cash equivalents with banks and short-term securities
Cash and cash equivalents and short-term financial receivables
Net short-term debt
NET FINANCIAL DEBT
Net financial debt of “Assets held for sale”
at Dec. 31,
2015
at Dec. 31,
2014
Change
6,863
35,987
2,022
44,872
(2,335)
42,537
844
180
1,024
4,570
319
213
1,698
64
6,864
(769)
(147)
(1,020)
(304)
(10,640)
(12,880)
(4,992)
37,545
841
7,022
39,749
1,884
48,655
(2,701)
45,954
824
30
854
4,056
245
2,599
457
166
7,523
(1,566)
(177)
(1,654)
(323)
(13,228)
(16,948)
(8,571)
37,383
620
(159)
(3,762)
138
(3,783)
366
(3,417)
20
150
170
514
74
(2,386)
1,241
(102)
(659)
797
30
634
19
2,588
4,068
3,579
162
221
-2.3%
-9.5%
7.3%
-7.8%
13.6%
-7.4%
2.4%
-
19.9%
12.7%
30.2%
-91.8%
-
-61.4%
-8.8%
50.9%
16.9%
38.3%
5.9%
19.6%
24.0%
41.8%
0.4%
35.6%
Net financial debt amounted to €37,545 million at December
> bonds amounted to €35,987 million, a decrease of €3,762
31, 2015, an increase of €162 million on December 31, 2014.
million on the end of 2014, mainly due to:
More specifically, net long-term debt fell by €3,417 million,
-
the reclassification to short term of the current portion
the balance of a decrease in long-term financial receivables
of bonds maturing within the next 12 months, including
of €366 million and a decline in gross long-term debt of
a floating-rate bond in the total amount of €1,000 mil-
€3,783 million.
lion and a fixed-rate note of €2,000 million, both issued
With regard to the latter aggregate:
by Enel SpA and maturing in February 2016, as well as
> bank borrowings amounted to €6,863 million, a decrease
a fixed-rate bond issued by Enel Finance International
of €159 million due mainly to the reclassification to short
in the amount of €1,082 million, maturing in September
term of the share of long-term bank borrowings falling
2016;
due within 12 months. This was partly offset by drawings
- new issues made in 2015, including a non-binding offer
on financing by the Latin American companies in the
to exchange in January 2015 through which Enel Finan-
amount of €266 million and drawings on the part of Ende-
ce International repurchased bonds in the total amount
sa on a EIB loan of €300 million;
of €1,429 million and at the same time issued a senior
32
Annual Report 2015
fixed-rate note of €1,462 million maturing in January
paid to counterparties in over-the-counter derivatives tran-
2025;
sactions on interest rates, exchange rates and commodities
- exchange losses on bonds (including current portion)
of €634 million.
during the year of about €820 million.
The main transactions carried out in 2015 included:
Net short-term debt showed a creditor position of €4,992
> the agreement on August 27, 2015 of a 15-year loan of
million at December 31, 2015, a decrease of €3,579 million
€145 million by the South African company Enel Green
on the end of 2014, the result of the decrease in other short-
Power RSA Proprietary Limited, secured by a guarantee
term borrowings of €659 million and the decrease in cash
from SACE SpA. At December 31, 2015, the loan had
and cash equivalents and short-term financial receivables in
been drawn in the amount of €30 million;
the amount of €4,068 million, partly offset by an increase in
> the following bond repayments:
short-term bank borrowings in the amount of €170 million,
- €1,000 million in respect of a fixed-rate bond, issued by
mainly as a result of the new bank borrowings by a number
Enel SpA in 2007, maturing in January 2015;
of Latin American companies.
- €1,300 million in respect of a fixed-rate bond, issued by
Other short-term debt, totaling €6,864 million, includes
- €1,195 million in respect of a fixed-rate bond, issued
commercial paper issued by Enel Finance International and
by Enel Finance International in 2011, maturing in June
Enel SpA in 2007, maturing in January 2015;
International Endesa BV amounting to €213 million, as well
2015.
as bonds maturing within 12 months amounting to €4,570
million.
The forward starting revolving credit facility of about €9.44
Finally, cash collateral paid to counterparties in over-the-
billion obtained in February 2013 by Enel SpA and Enel Fi-
counter derivatives transactions on interest rates, exchange
nance International, falling due in April 2018, was renegotia-
rates and commodities totaled €1,020 million, while cash
ted on February 11, 2015, reducing its cost and extending its
collateral received from such counterparties amounted to
term until 2020.
€1,698 million.
The facility was undrawn at December 31, 2015, as were
the committed credit lines obtained by Enel SpA and Enel
Cash and cash equivalents and short-term financial recei-
Finance International.
vables came to €12,880 million, down €4,068 million com-
In addition, on July 16, 2015, a €450 million credit facility was
pared with the end of 2014, mainly due to the decrease in
agreed between Enel SpA and UniCredit SpA, replacing the
cash with banks and short-term securities in the amount of
€400 million facility agreed on July 18, 2013, which was to
€2,588 million and in other short-term financial receivables
terminate in July 2016.
for €19 million, as well as the decrease in cash collateral
33
Report on operationsAnnual Report 2015 Cash flows
Millions of euro
Cash and cash equivalents at the beginning of the period (1)
Cash flows from operating activities
Cash flows from investing/disinvesting activities
Cash flows from financing activities
Effect of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at the end of the period (2)
2015
13,255
9,572
(6,421)
(5,382)
(234)
10,790
2014
7,900
10,058
(6,137)
1,536
(102)
13,255
Change
5,355
(486)
(284)
(6,918)
(132)
(2,465)
(1) Of which cash and cash equivalents equal to €13,088 million at January 1, 2015 (€7,873 million at January 1, 2014), short-term securities equal to €140 million
at January 1, 2015 (€17 million at January 1, 2014) and cash and cash equivalents pertaining to assets held for sale equal to €27 million at January 1, 2015
(€10 million at January 1, 2014).
(2) Of which cash and cash equivalents equal to €10,639 million at December 31, 2015 (€13,088 million at December 31, 2014), short-term securities equal to
€1 million at December 31, 2015 (€140 million at December 31, 2014) and cash and cash equivalents pertaining to assets held for sale equal to €150 million
at December 31, 2015 (€27 million at December 31, 2014).
Cash flows from operating activities in 2015 were a positive
Cash flows from financing activities absorbed liquidity in
€9,572 million, down €486 million on the previous year, mainly
the amount of €5,382 million, while in 2014 they showed cash
due to increased use of cash in connection with the change in
generated of €1,536 million. The flow in 2015 is essentially as-
net current assets.
sociated with the reduction of net financial debt (the net balance
of repayments and new borrowing) in the amount of €3,541
Cash flows from investing/disinvesting activities in 2015
million and the payment of dividends totaling €2,297 million, of
absorbed funds in the amount of €6,421 million, while in 2014
which €1,316 million paid to Enel SpA shareholders. This was
they had absorbed liquidity totaling €6,137 million.
only partly offset by higher receipts on transactions involving
More specifically, cash requirements in respect of investments
non-controlling interests in the amount of €456 million. More
in property, plant and equipment and in intangible assets
specifically, the latter include:
amounted to €7,762 million in 2015, up €1,061 million on the
> the receipt of €450 million (net of transaction costs) from
previous year, mainly due to increased investment abroad and
the disposal of 49% of EGPNA Renewable Energy Part-
in renewable technologies.
ners, a generation company operating in the United Sta-
Investments in entities or business units, net of cash and cash
tes;
equivalents acquired, amounted to €78 million in 2015 and re-
> the outlay of €9 million for the purchase of the remai-
garded the acquisition of 100% of a number of minor compa-
ning 49% of Energia Eolica, an Italian company active in
nies operating in the Mexican wind farm development sector,
the wind generation sector, in which the Group had pre-
the acquisition of 68% of BLP Energy, a company operating in
viously held the other 51%;
the renewables sector in India, the acquisition of 78.6% of Er-
> the net positive impact of other minor transactions (ca-
dwärme Oberland, a company specialized in the development
pital increases and decreases in companies in Chile, the
of geothermal projects in Germany as well as payments on ac-
United States and South Africa) totaling €15 million.
count for future equity investments.
In 2015, the disposal of entities and business units, net of cash
In 2015, cash flows from operating activities in the amount of
and cash equivalents sold, generated cash flows of €1,350 mil-
€9,572 million only partly covered the cash needs for financing
lion, mainly accounted for by the disposals of SE Hydropower
activities in the amount of €6,421 million and for investing acti-
and SF Energy, operating in the Italian hydroelectric generation
vities totaling €5,382 million. The difference is reflected in the
sector, the disposal of the ENEOP Group and other Portuguese
decrease in cash and cash equivalents, which at December 31,
companies of the Renewable Energy Division as well as the
2015 amounted to €10,790 million, compared with €13,255 mil-
disposal of a number of minor companies in Latin America and
lion at the end of 2014. This decrease also reflects the effect
North America.
of negative developments in the exchange rates of the various
Cash flows generated by other investing/disinvesting activities
local currencies against the euro, equal to €234 million.
in 2015 amounted to €69 million, and are essentially attributable
to ordinary disinvestments during the period.
34
Annual Report 2015
Results by business area
The representation of performance by business area presen-
the Renewable Energy Division, which, in view of its cen-
ted here is based on the approach used by management in
tralized management by the Enel Green Power sub-holding
monitoring Group performance for the two periods under
company, has greater autonomy than the other Divisions. In
review, taking account of the operational model adopted by
addition, account was also taken of the possibilities for the
the Group as described above.
simplification of disclosures associated with the materiali-
Taking account of the provisions of IFRS 8 regarding the
ty thresholds also established under IFRS 8 and, therefore,
management approach, the new organization modified the
the item “Other, eliminations and adjustments” includes not
structure of reporting, as well as the representation and
only the effects from the elimination of intersegment tran-
analysis of Group performance and financial position, as
sactions, but also the figures for the Parent Company, Enel
from the start of 2015. More specifically, performance by
SpA, and the Upstream Gas Division.
business area reported in this Annual Report was determi-
ned by designating the Regions and Countries perspective
The following chart outlines these organizational arrange-
as the primary reporting segment, with the exception of
ments.
SEGMENT REPORTING
2014
SEGMENT REPORTING
2015
HOLDING
SALES
GLOBAL DIVISIONS
GENERATION &
ENERGY MANAGEMENT
ITALY
LOCAL
BUSINESSES
GENERATION
AND TRADING
INFRASTRUCTURE
AND NETWORKS
UPSTREAM GAS
RENEWABLE
ENERGY
INFRASTRUCTURE
AND NETWORKS
IBERIA &
LATIN AMERICA
IBERIAN
PENINSULA
LATIN AMERICA
INTERNATIONAL
EASTERN EUROPE
RENEWABLE ENERGY
RENEWABLE ENERGY
OTHER
OTHER
ITALY
IBERIAN
PENINSULA
LATIN
AMERICA
EASTERN
EUROPE
I
S
E
R
T
N
U
O
C
/
S
N
O
G
E
R
I
35
Report on operationsAnnual Report 2015 Similarly, the figures for the 1st Quarter of 2014 have been
> the Iberia and Latin America Division, which had already
restated to take account of the new organization. Leaving
undergone reorganization in 2014, is now divided into the
aside certain movements of minor companies, the main
Regions “Iberian Peninsula” and “Latin America”;
changes were as follows:
> the service and support operations resident in Italy are
> the Sales, Generation and Energy Management, and In-
now reported under the Country “Italy”, rather than in the
frastructure and Networks Divisions, which operated al-
residual segment.
most entirely in Italy, are now reported under the Country
“Italy”;
SEGMENT REPORTING
2014
SEGMENT REPORTING
2015
HOLDING
SALES
GLOBAL DIVISIONS
GENERATION &
ENERGY MANAGEMENT
ITALY
LOCAL
BUSINESSES
GENERATION
AND TRADING
INFRASTRUCTURE
AND NETWORKS
UPSTREAM GAS
RENEWABLE
ENERGY
ITALY
IBERIAN
PENINSULA
LATIN
AMERICA
EASTERN
EUROPE
S
E
I
R
T
N
U
O
C
/
S
N
O
I
G
E
R
INFRASTRUCTURE
AND NETWORKS
IBERIA &
LATIN AMERICA
IBERIAN
PENINSULA
LATIN AMERICA
INTERNATIONAL
EASTERN EUROPE
RENEWABLE ENERGY
RENEWABLE ENERGY
OTHER
OTHER
36
Annual Report 2015 Segment information for 2015 and 2014
Results for 2015 (1)
Millions of euro
Iberian
Peninsula
Latin
America
Italy
Eastern
Europe
Renewable
Energy
Other,
eliminations
and
adjustments
Total
Revenue from third parties
38,155
19,644
10,599
4,488
2,747
25
75,658
Revenue from transactions with other
segments
1,489
461
28
343
264
(2,585)
-
Total revenue
39,644
20,105
10,627
4,831
3,011
(2,560)
75,658
Net income/(expense) from commodity
contracts measured at fair value
201
8
(4)
(17)
(25)
5
168
Gross operating margin
6,098
3,111
3,167
1,308
1,826
(213)
15,297
Depreciation, amortization and impairment
losses
Operating income
Capital expenditure
2,093
1,714
4,005
1,397
1,562 (2)
985
926
2,241
1,819
1,807
(499)
947
879
229 (3)
2,466
125
(338)
52
7,612
7,685
7,113
(1) Segment revenues include both revenues from third parties and revenue flows between the segments. An analogous approach was taken for other income
and costs for the year.
(2) Does not include €1 million regarding units classified as “held for sale”.
(3) Does not include €648 million regarding units classified as “held for sale”.
Results for 2014 restated (1) (2)
Millions of euro
Iberian
Peninsula
Latin
America
Italy
Eastern
Europe
Renewable
Energy
Other,
eliminations
and
adjustments
Total
Revenue from third parties
37,679
20,766
9,645
4,928
2,662
111
75,791
Revenue from transactions with other
segments
710
186
3
371
259
(1,529)
-
Total revenue
38,389
20,952
9,648
5,299
2,921
(1,418)
75,791
Net income/(expense) from commodity
contracts measured at fair value
(185)
(111)
(3)
(1)
76
(1)
(225)
Gross operating margin
6,343
3,203
3,092
1,210
1,938
(29)
15,757
Depreciation, amortization and impairment
losses
Operating income
Capital expenditure
4,425
1,963
1,918
1,240
1,460
993
1,543
1,549
1,609
3,886
(2,676)
936
814
1,124
1,658
39
12,670
(68)
45
3,087
6,701
(1) Segment revenues include both revenues from third parties and revenue flows between the segments. An analogous approach was taken for other income
and costs for the year.
(2) The figures have been restated to enable comparison with the results for 2015, which are presented on the basis of the new organization of the Enel Group,
which as from this year represents the basis for the planning, reporting and assessment of the performance and financial position of the Group, both inter-
nally by management and with respect to the financial community.
37
Report on operationsAnnual Report 2015 2015
restated
Change
2015
restated
Change
2015
restated
Change
2015
restated
Change
2014
3,935
1,759
-
-
1,398
1,422
260
258
3,933
1,643
-
7
(2)
(116)
(24)
2
-
7
Other, eliminations
and adjustments
2014
2014
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(41)
(41)
Total
2014
6,098
6,343
3,111
3,203
3,167
3,092
1,308
1,210
-
-
-
-
-
(245)
(92)
75
98
(184)
(460)
1,826
1,938
(112)
1,826
1,938
(112)
7,241
7,374
(133)
1,826
1,938
(112)
(178)
(137)
15,297
15,757
(178)
(137)
(213)
(29)
In addition to the foregoing, the Group monitors performan-
margin for the two periods under review, offering visibility
ce at the Global Division level, classifying results by busi-
of performance not only from a Region/Country perspective
ness line. The following table presents the gross operating
but also by Division/business line.
Gross operating margin
Local businesses
Global Divisions
Generation and Trading
Infrastructure and Networks
Renewable Energy
Millions of euro
End-user markets
Italy
Iberian Peninsula
Latin America
Eastern Europe
Renewable Energy
Other, eliminations
and adjustments
2015
1,336
479
-
11
-
-
2014
restated
1,124
780
-
11
-
-
Change
2015
Services
2014
restated
Change
212
(301)
-
-
-
-
32
(46)
(74)
(4)
-
-
127
(135)
(32)
6
-
-
(95)
89
(42)
(10)
-
-
2015
797
1,035
1,843
1,041
-
2014
restated
1,157
799
1,702
935
-
(42)
12
Change
(360)
236
141
106
-
(54)
69
Total
1,826
1,915
(89)
(92)
(34)
(58)
4,674
4,605
38
Annual Report 2015 Millions of euro
End-user markets
Generation and Trading
Infrastructure and Networks
Renewable Energy
Other, eliminations
and adjustments
Local businesses
Global Divisions
Gross operating margin
2015
restated
Change
2015
restated
Change
2015
restated
Change
797
1,157
(360)
Italy
1,336
1,124
Iberian Peninsula
479
780
Eastern Europe
11
11
Latin America
Renewable Energy
Other, eliminations
and adjustments
-
-
-
2014
-
-
-
212
(301)
-
-
-
-
Services
2014
127
(135)
(32)
6
-
-
32
(46)
(74)
(4)
-
-
2014
799
1,702
935
-
1,035
1,843
1,041
-
(42)
12
(95)
89
(42)
(10)
-
-
236
141
106
-
(54)
69
Change
2015
2014
restated
Change
2015
2014
restated
Change
2015
2015
3,933
1,643
2014
restated
3,935
1,759
1,398
1,422
260
258
-
7
-
-
(2)
(116)
(24)
2
-
7
-
-
-
-
-
-
-
-
-
-
-
-
1,826
1,938
(112)
-
-
-
-
-
-
-
-
(178)
Total
1,826
1,915
(89)
(92)
(34)
(58)
4,674
4,605
7,241
7,374
(133)
1,826
1,938
(112)
(178)
Total
2014
restated
6,098
6,343
3,111
3,203
3,167
3,092
1,308
1,210
Change
(245)
(92)
75
98
1,826
1,938
(112)
-
-
-
-
-
-
-
-
-
-
(41)
(41)
(137)
(213)
(29)
(137)
15,297
15,757
(184)
(460)
39
Report on operationsAnnual Report 2015 1
Italy
Net efficient generation capacity
27,671
2015
33,690
MW
2014
Performance in 2015
millions of euro
Thermal
plants
16,743
Hydroelectric
plants
10,893
Alternative
resources
35
Thermal
plants
22,463
Hydroelectric
plants
11,186
Alternative
resources
41
Electricity distribution networks
2015
Distribution lines
High voltage
Medium voltage
km
1,140,215
Low voltage
13
351,493
788,709
Customers
average number of
27,072,083
2015
27,207,897
2014
Free electricity market
6,105,541
Free electricity market
5,473,322
Regulated electricity market
20,966,542
Regulated electricity market
21,734,575
Revenue
39,644
Services, eliminations
and adjustments (6,573)
Generation and Trading
23,174
End-user markets
15,138
Infrastructure and Networks
7,905
Gross operating margin
Capital expenditure
6,098
Infrastructure
and Networks
3,933
Services
32
1,562 (1)
Infrastructure
and Networks
1,134
Services
66
Generation
and Trading
797
End-user markets
1,336
End-user
markets
124
Generation
and Trading
238 (1)
Natural gas
3,711,422
Natural gas
3,470,692
(1) Does not include €1 million regarding units classified as “held for sale”.
10
40
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
Annual Report 2015 1
Italy
Net efficient generation capacity
27,671
2015
33,690
MW
2014
Performance in 2015
millions of euro
Thermal
plants
16,743
Hydroelectric
plants
10,893
Alternative
resources
35
Thermal
plants
22,463
Hydroelectric
plants
11,186
Alternative
resources
41
Electricity distribution networks
2015
Distribution lines
High voltage
Medium voltage
km
1,140,215
Low voltage
13
351,493
788,709
Customers
average number of
27,072,083
2015
27,207,897
2014
Free electricity market
6,105,541
Free electricity market
5,473,322
Regulated electricity market
20,966,542
Regulated electricity market
21,734,575
Revenue
39,644
Services, eliminations
and adjustments (6,573)
Generation and Trading
23,174
End-user markets
15,138
Infrastructure and Networks
7,905
Gross operating margin
6,098
Infrastructure
and Networks
3,933
Services
32
Capital expenditure
1,562 (1)
Infrastructure
and Networks
1,134
Services
66
Generation
and Trading
797
End-user markets
1,336
End-user
markets
124
Generation
and Trading
238 (1)
Natural gas
3,711,422
Natural gas
3,470,692
(1) Does not include €1 million regarding units classified as “held for sale”.
10
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
41
Report on operationsAnnual Report 2015 Operations
Net electricity generation
Millions of kWh
Thermal
Hydroelectric
Other resources
Total net generation
- of which Italy
- of which Belgium
2015
43,495
11,939
8
55,442
55,442
2014
Change
42,528
967
2.3%
15,861
(3,922)
-24.7%
8
-
-
58,397
(2,955)
57,707
(2,265)
-5.1%
-3.9%
-
690
(690)
-
In 2015, net electricity generation amounted to 55,442 mil-
kWh). Excluding the impact of the change in the scope of
lion kWh, a decrease of 5.1%, or 2,955 million kWh on 2014.
consolidation associated with the Marcinelle Energie plant
More specifically, the decline in hydro generation (-3,922
from that change, following the early termination of the
million kWh), mainly associated with the deterioration in wa-
tolling agreement for the operation of that facility by Enel
ter conditions compared with the previous year, was only
Trade at the end of 2014, the increase in thermal generation
partly offset by an increase in thermal output (+967 million
amounted to 1,657 million kWh.
Contribution to gross thermal generation
Millions of kWh
Fuel oil
Natural gas
Coal
Other fuels
Total
2015
2014
Change
274
0.6%
499
1.1%
(225)
-45.1%
8,126
17.3%
7,761
16.9%
365
4.7%
38,177
81.3%
37,146
80.9%
1,031
2.8%
391
0.8%
498
1.1%
(107)
-21.5%
46,968
100.0%
45,904
100.0%
1,064
2.3%
Gross thermal generation in 2015 totaled 46,968 million
of coal as a result of the increased competitiveness of this
kWh, an increase of 1,064 million kWh (+2.3%) compared
raw material.
with 2014. The increase was mainly due to the rise in the use
42
Annual Report 2015
Net efficient generation capacity
MW
Thermal plants (1)
Hydroelectric plants
Alternative resources
at Dec. 31, 2015 at Dec. 31, 2014
Change
16,743
10,893
35
22,463
(5,720)
-25.5%
11,186
(293)
-2.6%
41
(6)
-14.6%
Total net efficient capacity
27,671
33,690
(6,019)
-17.9%
(1) Of which 2,564 MW unavailable due to long-term technical issues (5,460 MW at December 31, 2014).
Net efficient capacity in 2015 totaled 27,671 MW, a reduction
Environment and for Economic Development to shut down
of 6,019 MW on the previous year.
generation assets pursuant to the provisions of Law 290 of
The unavailability due to long-term technical issues is mainly
October 27, 2003.
connected with additional requests from the Ministries for the
Electricity distribution and transport networks
High-voltage lines at year-end (km)
Medium-voltage lines at year-end (km)
Low-voltage lines at year-end (km)
Total electricity distribution network (km)
1,140,215
1,136,667
Electricity transported on Enel’s distribution network (millions of kWh) (1)
226,569
222,975
(1) The figure for 2014 reflects a more accurate determination of amounts transported.
2015
13
2014
20
Change
(7)
-33.9%
351,493
350,358
788,709
786,289
1,135
2,420
3,548
3,594
0.3%
0.3%
0.3%
1.6%
Electricity transported on Enel‘s distribution network in Italy
The change is essentially in line with the increase in electri-
in 2015 increased by 3,594 million kWh (+1.6%), going from
city demand in Italy.
222,975 million kWh in 2014 to 226,569 million kWh in 2015.
Electricity sales
Millions of kWh
Free market:
- mass-market customers
- business customers (1)
- safeguard market customers
Total free market
Regulated market:
- enhanced protection market customers
TOTAL
2015
2014
Change
25,933
10,904
1,819
38,656
49,369
88,025
25,148
10,742
1,479
785
162
340
3.1%
1.5%
23.0%
37,369
1,287
3.4%
49,734
87,103
(365)
922
-0.7%
1.1%
(1) Supplies to large customers and energy-intensive users (annual consumption greater than 1 GWh).
43
Report on operationsAnnual Report 2015 Electricity sold in 2015 totaled 88,025 million kWh, up 922
gradual shift of customers from regulated markets to the
million kWh compared with the previous year. These deve-
free market.
lopments are consistent with those in recent years, with the
Average number of customers
Free market:
- mass-market customers
- business customers (1)
- safeguard market customers
Total free market
Regulated market
2015
2014
Change
6,012,183
5,387,579
624,604
11.6%
52,625
40,733
51,215
34,528
1,410
6,205
2.8%
18.0%
6,105,541
5,473,322
632,219
11.6%
- enhanced protection market customers
20,966,542
21,734,575
(768,033)
TOTAL
27,072,083
27,207,897
(135,814)
-3.5%
-0.5%
(1) Large customers and energy-intensive users (annual consumption greater than 1 GWh).
Natural gas sales
Gas sales (millions of m3):
- mass-market customers (1)
- business customers
Total sales
2015
2014
Change
3,394
677
4,071
2,937
559
3,496
457
118
575
15.6%
21.1%
16.4%
Average number of customers
3,711,422
3,470,692
240,730
6.9%
(1) Includes residential customers and microbusinesses.
Gas sales in 2015 totaled 4,071 million cubic meters, an
previous year, essentially attributable to sales to residential
increase of 575 million cubic meters compared with the
customers and microbusinesses.
Performance
Millions of euro
Revenue
Gross operating margin
Operating income
Capital expenditure
(1) Does not include €1 million regarding units classified as “held for sale”.
The following tables break down performance by type of business in 2015.
44
2015
2014 restated
Change
39,644
38,389
6,098
4,005
1,562 (1)
6,343
1,918
1,460
1,255
(245)
2,087
3.3%
-3.9%
-
102
7.0%
Annual Report 2015 Revenue
Millions of euro
Generation and Trading
Infrastructure and Networks
End-user markets
Services
Eliminations and adjustments
Total
2015
2014 restated
Change
23,174
7,905
15,138
1,191
(7,764)
39,644
22,586
7,183
15,374
1,087
(7,841)
38,389
588
722
2.6%
10.1%
(236)
-1.5%
104
77
1,255
9.6%
1.0%
3.3%
Revenue in 2015 amounted to €39,644 million, an increase
Infrastructure and Networks operations, largely reflec-
of €1,255 million compared with 2014 (+3.3%), the result of
ting:
the following main factors:
- an increase of €560 million in rate revenue, largely at-
> an increase of €558 million (+2.6%) in revenue from Ge-
tributable to the regulatory changes introduced with
neration and Trading operations compared with 2014.
Resolution 654/2015 of the Authority for Electricity, Gas
The increase is primarily attributable to:
and the Water System (the “Authority“), which elimina-
- an increase of €2,330 million in revenue from fuel sa-
ted the “regulatory lag”, and to the increase in transmis-
les on domestic and international wholesale markets,
sion rates with Resolution 655/2014, only partly offset
mainly due to a rise in the volumes handled as a result
by the reduction in distribution rates (as established
of an increase in intermediation business;
under Authority Resolution 146/2015);
- an increase of €106 million in revenue from non-recur-
- an increase of €172 million associated with the recogni-
ring transactions. In particular, in 2015 this included the
tion of adjustments and revisions of estimates made in
sale of SF Energy and SE Hydropower totaling €156
previous years, essentially associated with equalization
million. In 2014, the item included the remeasurement
mechanisms for grid losses;
at fair value of the net assets of SE Hydropower (€50
- an increase in revenue from the sale of electronic me-
million) following the loss of control of that company
ters to distribution companies in the Iberian Peninsula
in accordance with the provisions of the shareholder
(€60 million);
agreements;
- a decrease of €62 million in revenue following the re-
- a decrease of €902 million in revenue from electricity
duction in transfers from the Electricity Equalization
sales. The change is essentially attributable to the re-
Fund for white certificates owing to the decline in volu-
duction in revenue from sales on the Power Exchange
mes and the decrease in the unit grant for the period;
(€582 million), associated with falling average sales pri-
- a decrease of €24 million in connection fees;
ces, which was accompanied by a reduction in sales of
> a decline of €236 million (-1.5%) in revenue from end-
electricity to the other Group companies, especially the
user markets for electricity, essentially reflecting:
Italian companies operating in end-user markets (€121
- a decline of €683 million in revenue on the regulated
million), as well as in sales to other domestic resellers
electricity market as a result of the reduction in the
(€187 million);
average number of customers and the decline in the
- a decrease of €560 million in revenue from the sale of
annual average price set by the Authority;
CO2 emissions allowances, owing to lower volumes
handled;
- an increase of €272 million in revenue from sales to end
users on the natural gas market, primarily reflecting an
- a decrease of €410 million in revenue from trading on
increase in quantities sold to mass-market customers;
international electricity markets due to a decline in ave-
- an increase of €175 million in revenue on the free elec-
rage sales prices, which more than offset the effect of
tricity market as a result of an increase in quantities
an increase in quantities handled (+8.2 TWh);
sold (+1.3 TWh).
> an increase of €722 million (+10.1%) in revenue from
45
Report on operationsAnnual Report 2015 Gross operating margin
Millions of euro
Generation and Trading
Infrastructure and Networks
End-user markets
Services
Total
2015
797
3,933
1,336
32
6,098
2014 restated
Change
1,157
3,935
1,124
127
6,343
(360)
(2)
212
(95)
(245)
-31.1%
-0.1%
18.9%
-74.8%
-3.9%
The gross operating margin in 2015 amounted to €6,098
with the trade unions for early retirement incentives
million, a decrease of €245 million (-3.9%) compared with
for personnel under Article 4 of Law 92/2012 and the
2014. The decrease is essentially attributable to:
payment of a lump-sum benefit to retired employees
> a decrease of €360 million in the margin from Generation
who had been receiving the energy discount following
and Trading operations, mainly reflecting:
revocation of that benefit, with a corresponding rever-
- a reduction in the margin on generation, reflecting a
sal of the associated provision;
more unfavorable generation mix as a result of poor
- a positive adjustment of €63 million of the provision
water conditions in an environment of falling wholesale
for risks and litigation, recognized in the 1st Quarter of
prices;
2014 following the settlement between Enel Distribu-
-
the change in the contribution of disposals, discussed
zione, A2A and A2A Reti Elettriche concerning pending
earlier under revenue, in the amount of €106 million;
litigation before the Court of Appeal of Milan;
-
the net impact (€112 million) of the new agreement
- a reduction of €24 million in the margin from connec-
with the trade unions for early retirement incentives
tion fees;
for personnel under Article 4 of Law 92/2012 and the
- a reduction in operating expenses;
payment of a lump-sum benefit to retired employees
> an increase of €212 million in the margin from end-user
who had been receiving the energy discount following
markets (+18.9%), mainly attributable to:
revocation of that benefit, with a corresponding rever-
- an increase of €306 million in the margin on the free
sal of the associated provision;
markets for electricity and gas (€254 million of which
> a decrease of €2 million in the margin from Infrastructure
attributable to the margin on electricity) due to the in-
and Networks operations (-0.1%), largely due to:
crease in quantities sold for both commodities;
- an increase of €560 million in the margin on electricity
- a reduction in the margin on the regulated electricity
transport, primarily reflecting the net impact of the re-
market as a result of the contraction in revenue due to
gulatory change introduced with Authority Resolution
the decline in the number of customers served;
654/2015, as well as the positive impact of €139 million
-
the net impact (€89 million) of the new agreement with
from prior-year items; these factors were only partly of-
the trade unions for early retirement incentives for per-
fset by the reduction in distribution rates;
sonnel under Article 4 of Law 92/2012 and the payment
- a decrease of €269 million in the margin on EECs due
of a lump-sum benefit to retired employees who had
mainly to the change in cost reimbursement mechani-
been receiving the energy discount following revoca-
sm for the purchase of such certificates;
tion of that benefit, with a corresponding reversal of the
-
the net impact (€179 million) of the new agreement
associated provision.
46
Annual Report 2015
Operating income
Millions of euro
Generation and Trading
Infrastructure and Networks
End-user markets
Services
Total
2015
419
2,914
690
(18)
4,005
2014 restated
Change
(1,546)
2,926
472
66
1,918
1,965
(12)
218
(84)
2,087
-
-0.4%
46.2%
-
-
Operating income amounted to €4,005 million. With a re-
due to the impact of the impairment losses recognized at
duction of €2,332 million in depreciation, amortization and
the end of 2014 on conventional generation plants in Italy,
impairment losses, this represented an increase of €2,087
which also gave rise to an impairment of €2,108 in the pre-
million on the €1,918 million posted in 2014. The decrease in
vious year.
depreciation, amortization and impairment losses is largely
Capital expenditure
Millions of euro
Generation and Trading
Infrastructure and Networks
End-user markets
Services
Total
2015
238 (1)
1,134
124
66
1,562
2014 restated
Change
285
967
141
67
1,460
(47)
167
(17)
(1)
102
-16.5%
17.3%
-12.1%
-1.5%
7.0%
(1) Does not include €1 million regarding units classified as “held for sale”.
Capital expenditure in 2015 amounted to €1,562 million,
> a decrease of €47 million in investment in Generation
up €102 million on the previous year. More specifically, the
and Trading;
change is attributable to:
> a decrease of €17 million in end-user markets.
> an increase of €167 million in investment in Infrastruc-
ture and Networks, primarily in work to improve and
maintain service quality standards;
47
Report on operationsAnnual Report 2015
2
Iberian Peninsula
Net efficient generation capacity
21,207
2015
21,713
Thermal
plants
13,168
Hydroelectric
plants
4,721
Nuclear
plants
3,318
Thermal
plants
13,674
Hydroelectric
plants
4,721
Nuclear
plants
3,318
Electricity distribution networks
Distribution lines
2015
MW
2014
km
317,675
Performance in 2015
millions of euro
Revenue
20,105
Services, eliminations
and adjustments (4,463)
Infrastructure and Networks
2,667
Generation
and Trading
6,301
End-user markets
15,600
Gross operating margin
Capital expenditure
3,111
Infrastructure
and Networks
1,643
Services
(46)
985
Infrastructure
and Networks
615
Services
2
End-user
markets
479
Generation
and Trading
1,035
End-user
markets
49
Generation
and Trading
319
High voltage
Medium voltage
Low voltage
19,479
118,436
179,760
10
48
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
Annual Report 2015 2
Iberian Peninsula
Thermal
plants
13,168
Hydroelectric
plants
4,721
Nuclear
plants
3,318
Thermal
plants
13,674
Hydroelectric
plants
4,721
Nuclear
plants
3,318
Electricity distribution networks
Distribution lines
2015
High voltage
Medium voltage
Low voltage
19,479
118,436
179,760
MW
2014
km
317,675
Net efficient generation capacity
Performance in 2015
millions of euro
21,207
2015
21,713
Revenue
20,105
Services, eliminations
and adjustments (4,463)
Infrastructure and Networks
2,667
Generation
and Trading
6,301
End-user markets
15,600
Gross operating margin
3,111
Infrastructure
and Networks
1,643
Services
(46)
Capital expenditure
985
Infrastructure
and Networks
615
Services
2
End-user
markets
479
Generation
and Trading
1,035
End-user
markets
49
Generation
and Trading
319
10
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
49
Report on operationsAnnual Report 2015 Operations
Net electricity generation
Millions of kWh
Thermal
Nuclear
Hydroelectric
Total net generation
2015
40,129
25,756
7,176
73,061
2014
Change
36,141
3,988
11.0%
24,762
994
4.0%
8,778
(1,602)
-18.3%
69,681
3,380
4.9%
Net electricity generation in the Iberian Peninsula in 2015
decline in water resources was largely met by an increase
totaled 73,061 million kWh, an increase of 3,380 million
in thermal generation.
kWh compared with 2014. The increase in demand and the
Contribution to gross thermal generation
Millions of kWh
High-sulfur fuel oil (S>0.25%)
Natural gas
Coal
Nuclear fuel
Other fuels
Total
2015
2014
Change
5,632
5,167
8.1%
7.5%
5,460
3,037
8.6%
4.7%
172
3.2%
2,130
70.1%
27,441
39.7%
25,567
40.0%
1,874
7.3%
26,806
38.8%
25,776
40.3%
1,030
4.0%
4,116
5.9%
4,124
6.4%
(8)
-0.2%
69,162
100.0%
63,964
100.0%
5,198
8.1%
Gross thermal generation in 2015 totaled 69,162 million
fuels, was particularly significant for natural gas, while coal
kWh, an increase of 5,198 million kWh compared with the
and nuclear fuel remained the most used fuels.
previous year. The increase, which regarded all types of
Net efficient generation capacity
MW
Thermal plants
Nuclear plants
Hydroelectric plants
at Dec. 31, 2015 at Dec. 31, 2014
Change
13,168
13,674
(506)
-3.7%
3,318
4,721
3,318
4,721
-
-
-
-
Total net efficient capacity
21,207
21,713
(506)
-2.3%
Net efficient capacity in 2015 totaled 21,207 MW, a decrease of 506 MW on the previous year connected with the closure
in 2015 of the Foix thermal plant.
50
Annual Report 2015 Electricity distribution and transport networks
High-voltage lines at year-end (km)
Medium-voltage lines at year-end (km)
Low-voltage lines at year-end (km)
Total electricity distribution network (km)
Electricity transported on Enel’s distribution network (millions of kWh)
2015
19,479
118,436
179,760
317,675
98,225
2014
19,597
117,877
177,054
314,528
96,404
Change
(118)
559
2,706
3,147
1,821
-0.6%
0.5%
1.5%
1.0%
1.9%
Electricity transported in 2015 totaled 98,225 million kWh, an increase of 1,821 million kWh.
Electricity sales
Millions of kWh
Electricity sold by Enel
2015
92,899
2014
Change
93,928
(1,029)
-1.1%
Electricity sales to end users in 2015 amounted to 92,899
(operating in the regulated market) customers to the free
million kWh, a decrease of 1,029 million kWh compared
market, which was not fully offset by new customers acqui-
with 2014, as a result of the increasing liberalization of the
red by Endesa Energia (on the free market).
market and the consequent switch of Endesa Energia XXI
Performance
Millions of euro
Revenue
Gross operating margin
Operating income
Capital expenditure
The following tables break down performance by type of business in 2015.
Revenue
Millions of euro
Generation and Trading
Infrastructure and Networks
End-user markets
Services
Eliminations and adjustments
Total
2015
2014 restated
Change
20,105
20,952
(847)
3,111
1,397
985
3,203
1,240
993
(92)
157
(8)
-4.0%
-2.9%
12.7%
-0.8%
2015
2014 restated
Change
6,301
2,667
6,225
2,599
15,600
15,827
251
(4,714)
20,105
322
(4,021)
20,952
76
68
(227)
(71)
(693)
(847)
1.2%
2.6%
-1.4%
-22.0%
-17.2%
-4.0%
51
Report on operationsAnnual Report 2015 Revenue declined by €847 million, reflecting:
- a decrease of €105 million in revenue from the sale of
> a decrease of €227 million in revenue from end-user
electricity by the generation companies. This revenue
markets, essentially due to the decline in amounts of
was largely in relation to the Division companies that
electricity and gas sold, as well as the reduction in the
sell electricity and so is also reflected in an analogous
average sales price of the latter commodity. These factors
increase in eliminations;
were only partly offset by developments in electricity pri-
> an increase of €68 million in revenue from Infrastructure
ces, which increased over the year as a whole;
and Networks operations, primarily reflecting the increa-
> an increase of €76 million in revenue from Generation
se in quantities transported and the rise in revenue from
and Trading operations, primarily associated with:
connection fees.
- an increase of €183 million in revenue from the sale
and measurement at fair value of environmental cer-
tificates;
Gross operating margin
Millions of euro
Generation and Trading
Infrastructure and Networks
End-user markets
Services
Total
2015
1,035
1,643
479
(46)
3,111
2014 restated
Change
799
1,759
780
(135)
3,203
236
(116)
(301)
89
(92)
29.5%
-6.6%
-38.6%
65.9%
-2.9%
The gross operating margin amounted to €3,111 million,
on Generation and Trading operations, primarily asso-
a decrease of €92 million compared with 2014, reflecting:
ciated with:
> a decrease in the gross operating margin on end-user
- an improvement in the margin on generation, largely
markets, largely due to the decline in the margin on elec-
attributable to the higher average sales prices;
tricity sales, which reflects higher electricity procurement
-
the positive impact of a number of regulatory chan-
costs, as well as a decline in the margin on natural gas
ges, including those concerning water use fees in the
sales;
amount of €46 million and the impact of lower fees on
> a decrease of €116 million in the margin on Infrastructure
generation in the extra-peninsular area for 2014 due to
and Networks operations, reflecting higher costs in 2015
adjustments related, in part, to previous periods (2012
as a result of the introduction of a voluntary early retire-
and 2013);
ment scheme for employees;
- an increase of €186 million in the margin on envi-
> an increase of €236 million in the gross operating margin
ronmental certificates.
Operating income
Millions of euro
Generation and Trading
Infrastructure and Networks
End-user markets
Services
Total
52
2015
2014 restated
Change
267
868
322
(60)
1,397
(133)
919
631
(177)
1,240
400
(51)
(309)
117
157
-
-5.5%
-49.0%
66.1%
12.7%
Annual Report 2015
Operating income in 2015, after depreciation, amortization
rment losses largely reflects the extension of the useful life
and impairment losses of €1,714 million (€1,963 million in
of a number of generating plants at the end of 2014 and a de-
2014), totaled €1,397 million, an increase of €157 million on
cline in impairment of certain property, plant and equipment
2014. The reduction in depreciation, amortization and impai-
and intangible assets in 2015 compared with 2014.
Capital expenditure
Millions of euro
Generation and Trading
Infrastructure and Networks
End-user markets
Services
Total
2015
2014 restated
Change
319
615
49
2
985
322
640
31
-
993
(3)
(25)
18
2
(8)
-0.9%
-3.9%
58.1%
-
-0.8%
Capital expenditure amounted to €985 million, a decrease
plants (€299 million) as well as work on the distribution net-
of €8 million compared with the previous year. In particular,
work (€586 million), notably projects related to improving
capital expenditure in 2015 primarily concerned generation
service quality.
53
Report on operationsAnnual Report 2015
3
Latin America
Net efficient generation capacity
17,012
2015
16,602
MW
2014
Performance in 2015
millions of euro
Thermal
plants
7,716
Hydroelectric
plants
9,218
Wind plants
78
Thermal
plants
7,731
Hydroelectric
plants
8,793
Wind plants
78
Revenue 10,627
Argentina
Brazil
Chile
Colombia
Peru
1,127
2,771
3,327
2,159
1,243
Argentina
Brazil
Argentina
Brazil
Gross operating margin 3,167
4,384
976
4.403
976
Chile
Colombia
Peru
Chile
Colombia
Peru
Argentina
Brazil
Chile
Colombia
Peru
6,286
3,407
1,959
6,286
3,012
1,925
280
491
938
973
485
Electricity distribution networks
2015
Distribution lines
High voltage
Medium voltage
km
316,496
Low voltage
Capital expenditure 1,819
Argentina
Brazil
Chile
Colombia
Peru
12,173
157,077
147,246
350
371
377
538
183
10
54
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
Annual Report 2015 3
Latin America
Net efficient generation capacity
17,012
2015
16,602
MW
2014
Performance in 2015
millions of euro
Thermal
plants
7,716
Hydroelectric
plants
9,218
Wind plants
78
Thermal
plants
7,731
Hydroelectric
plants
8,793
Wind plants
78
Revenue 10,627
Argentina
Brazil
Chile
Colombia
Peru
1,127
2,771
3,327
2,159
1,243
Argentina
Brazil
Argentina
Brazil
Gross operating margin 3,167
4,384
976
4.403
976
Chile
Colombia
Peru
Chile
Colombia
Peru
Argentina
Brazil
Chile
Colombia
Peru
6,286
3,407
1,959
6,286
3,012
1,925
280
491
938
973
485
Electricity distribution networks
2015
Distribution lines
High voltage
Medium voltage
km
316,496
Low voltage
Capital expenditure 1,819
Argentina
Brazil
Chile
Colombia
Peru
12,173
157,077
147,246
350
371
377
538
183
10
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
55
Report on operationsAnnual Report 2015 Operations
Net electricity generation
Millions of kWh
Thermal
Hydroelectric
Other sources
Total net generation
- of which Argentina
- of which Brazil
- of which Chile
- of which Colombia
- of which Peru
2015
26,252
34,012
138
60,402
15,204
4,398
18,294
13,705
8,801
2014
26,142
33,999
158
60,299
14,390
5,225
18,063
13,559
9,062
Change
110
13
(20)
103
814
(827)
231
146
(261)
0.4%
-
-12.7%
0.2%
5.7%
-15.8%
1.3%
1.1%
-2.9%
Net electricity generation in 2015 totaled 60,402 million
plants in Colombia and Argentina as a result of rising de-
kWh, an increase of 103 million kWh compared with 2014,
mand, while hydroelectric generation was virtually unchan-
mainly due to an increase in generation by the thermal
ged.
Contribution to gross thermal generation
Millions of kWh
2015
2014
Change
High-sulfur fuel oil (S>0.25%)
Natural gas
Coal
Other fuels
Total
1,643
20,367
3,156
2,308
6.0%
74.1%
11.5%
8.4%
1,590
5.8%
53
21,504
79.1%
(1,137)
2,391
1,707
8.8%
6.3%
3.3%
-5.3%
32.0%
35.2%
1.0%
765
601
282
27,474
100.0%
27,192
100.0%
Gross thermal generation in 2015 amounted to 27,474 mil-
year, essentially due to a reduction in the use of natural gas
lion kWh, an increase of 282 million kWh on the previous
in Peru.
Net efficient generation capacity
MW
Thermal plants
Hydroelectric plants
Wind plants
Total net efficient capacity
- of which Argentina
- of which Brazil
- of which Chile
- of which Colombia
- of which Peru
at Dec. 31, 2015
at Dec. 31, 2014
Change
7,716
9,218
78
17,012
4,384
976
6,286
3,407
1,959
7,731
8,793
78
16,602
4,403
976
6,286
3,012
1,925
(15)
425
-
410
(19)
-
-
395
34
-0.2%
4.8%
-
2.5%
-0.4%
-
-
13.1%
1.8%
Net efficient capacity amounted to 17,012 MW at the end of 2015, an increase of 410 MW on the previous year, essentially
due to the expansion of installed capacity in Colombia.
56
Annual Report 2015 Electricity distribution and transport networks
2015
2014
Change
High-voltage lines at year-end (km)
Medium-voltage lines at year-end (km)
Low-voltage lines at year-end (km)
Total electricity distribution network (km)
12,173
12,089
157,077
154,767
147,246
144,896
316,496
311,752
Electricity transported on Enel’s distribution network (millions of kWh) (1)
- of which Argentina
- of which Brazil
- of which Chile
- of which Colombia
- of which Peru
78,030
18,492
22,311
15,657
13,946
7,624
(1) The figure for 2014 reflects a more accurate calculation of quantities transported.
Electricity transported in 2015 totaled 78,030 million kWh, an increase of 399 million kWh.
Electricity sales
Millions of kWh
Free market
Regulated market
Total
- of which Argentina
- of which Brazil
- of which Chile
- of which Colombia
- of which Peru
2015
6,062
57,370
63,432
15,450
19,506
13,203
8,463
6,810
77,631
18,025
22,878
15,702
13,667
7,359
2014
5,891
57,217
63,108
14,980
19,982
13,257
8,225
6,664
84
2,310
2,350
4,744
399
467
(567)
(45)
279
265
171
153
324
470
(476)
(54)
238
146
Change
0.7%
1.5%
1.6%
1.5%
0.5%
2.6%
-2.5%
-0.3%
2.0%
3.6%
2.9%
0.3%
0.5%
3.1%
-2.4%
-0.4%
2.9%
2.2%
Electricity sales in 2015 amounted to 63,432 million kWh, an increase of 324 million kWh, in line with developments in
demand.
Performance
Millions of euro
Revenue
Gross operating margin
Operating income
Capital expenditure
The following tables show performance by country in 2015.
2015
2014 restated
Change
10,627
3,167
2,241
1,819
9,648
3,092
1,549
1,609
979
75
692
210
10.1%
2.4%
44.7%
13.1%
57
Report on operationsAnnual Report 2015 Revenue
Millions of euro
Argentina
Brazil
Chile
Colombia
Peru
Total
2015
2014 restated
Change
1,127
2,771
3,327
2,159
1,243
10,627
712
2,994
2,774
2,116
1,052
9,648
415
(223)
553
43
191
979
58.3%
-7.4%
19.9%
2.0%
18.2%
10.1%
Revenue in 2015 posted an increase of €979 million. The
> an increase of €553 million in revenue in Chile, largely due to:
rise was primarily attributable to:
-
favorable developments in exchange rates between the
> an increase of €415 million in revenue in Argentina, of
local currency and the euro (€129 million);
which €247 million associated with the impact of Resolu-
- an increase in rates in the regulated market;
ción 32/2015, with which regulators established a theoreti-
-
the full consolidation of Inversiones Gas Atacama fol-
cal rate framework for distribution companies that enables
lowing the acquisition (on April 22, 2014) of an additio-
them to recover the extra operating costs for the remune-
nal 50%, giving control over the company, as well as
ration of personnel incurred to keep the service in opera-
a number of minor non-recurring operations (Túnel El
tion, as well as other grants under the PUREE program and
Melón, Maitenes, Agua Santiago Poniente);
the Mecanismo de Monitoreo de Costos (MMC). These
> an increase of €43 million in revenue in Colombia, largely
factors were accompanied by the effects of the increase
attributable to an increase in amounts generated and sold
in the quantity of electricity sold by both the generation
and in average sales prices for both generation companies
companies and distribution companies;
and distribution companies, only partly offset by the im-
> a decrease of €223 million in revenue in Brazil, largely at-
pact of exchange rate developments;
tributable to the depreciation of the local currency against
> an increase of €191 million in revenue in Peru, primarily due
the euro (totaling €507 million) and the broad decline in
to an increase in quantities sold and exchange rate effects.
demand, only partly offset by rate revisions and a rise in
average sales prices;
Gross operating margin
Millions of euro
Argentina
Brazil
Chile
Colombia
Peru
Total
2015
2014 restated
Change
280
491
938
973
485
3,167
29
791
743
1,097
432
3,092
251
(300)
195
(124)
53
75
-
-37.9%
26.2%
-11.3%
12.3%
2.4%
The gross operating margin amounted to €3,167 million,
offset by the increase in operating costs, especially per-
an increase of €75 million (+2.4%) compared with 2014, re-
sonnel costs following a contractual pay adjustment, and
flecting:
an increase in the average workforce;
> an increase of €251 million in the gross operating mar-
> an increase of €195 million in the gross operating margin
gin in Argentina, reflecting the introduction of Resolución
in Chile, due to an increase in the margin on generation
32/2015 noted earlier, the impact of which was only partly
and distribution, as well as the appreciation of the local
58
Annual Report 2015
currency with respect to the euro (€38 million);
by exchange rate losses (€145 million);
> an increase of €53 million in the gross operating margin in
> a reduction of €300 million in the gross operating margin
Peru, primarily owing to exchange rate developments and
in Brazil, reflecting the decline in demand in the country
to greater volumes sold;
and the impact of the drought, which has led to an incre-
> a reduction of €124 million in the gross operating margin
ase in electricity prices, hurting companies that distribute
in Colombia, where the positive impact of the increase in
and sell electricity, as well as exchange rate losses (€91
output and amount distributed was almost entirely offset
million).
Operating income
Millions of euro
Argentina
Brazil
Chile
Colombia
Peru
Total
2015
2014 restated
Change
210
145
722
816
348
(19)
376
(41)
920
313
2,241
1,549
229
(231)
763
(104)
35
692
-
-61.4%
-
-11.3%
11.2%
44.7%
Operating income in 2015 totaled €2,241 million, including
use rights in the region of Aysén recognized in response to
€926 million in depreciation, amortization and impairment
the uncertainty about the continuation of the project owing
losses (€1,543 million in 2014), an increase of €692 million
to a number of legal and procedural constraints. Deprecia-
over 2014. In addition to the change in the gross operating
tion and amortization were in line with 2014, given that the
margin, the performance reflects the effects of the recogni-
effects of the entry into service of a number of plants were
tion in 2014 of impairment losses (€589 million) on water
essentially offset by exchange rate effects.
Capital expenditure
Millions of euro
Argentina
Brazil
Chile
Colombia
Peru
Total
2015
2014 restated
Change
350
371
377
538
183
276
306
432
434
161
1,819
1,609
74
65
(55)
104
22
210
26.8%
21.2%
-12.7%
24.0%
13.7%
13.1%
Capital expenditure amounted to €1,819 million, an incre-
the Los Condores hydroelectric facility in Chile;
ase of €210 million on the previous year. More specifically,
> work on the El Quimbo hydroelectric plant (which ente-
investment in 2015 regarded:
red service at the end of 2015), and on the distribution
> works to improve the distribution grid and modernize
grid in Colombia;
thermal plants in Argentina;
> the extension and upgrading of the distribution grid in
> work on the distribution grid in Brazil;
Peru.
> work on the Bocamina and Tarapacá thermal plants and
59
Report on operationsAnnual Report 2015
4
Eastern Europe
Net efficient generation capacity
13,382
2015
14,481
MW
2014
Performance in 2015
millions of euro
Thermal
plants
9,950
Nuclear
plants
1,814
Hydroelectric
plants
1,590
Other
resources
28
Thermal
plants
10,310
Nuclear
plants
1,814
Hydroelectric
plants
2,329
Other
resources
28
Russia
Slovakia
Belgium
Russia
Slovakia
Belgium
Revenue 4,831
Romania
Russia
Slovakia
Other countries
1,004
1,062
2,401
364
Gross operating margin 1,308
Romania
Russia
Slovakia
Other countries
8,944
4,032
406
9,107
4,968
406
281
164
871
(8)
Electricity distribution networks
2015
Distribution lines
km
91,285
High voltage
Medium voltage
Low voltage
6,584
35,043
49,658
Capital expenditure 229 (1)
Romania
Russia
Other countries
116
112
1
(1) Does not include €648 million regarding units classified as “held for sale”.
10
60
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
Annual Report 2015 4
Eastern Europe
Thermal
plants
9,950
Nuclear
plants
1,814
Hydroelectric
plants
1,590
Thermal
plants
10,310
Nuclear
plants
1,814
Hydroelectric
plants
2,329
Other
resources
28
Other
resources
28
Russia
Slovakia
Belgium
Russia
Slovakia
Belgium
Net efficient generation capacity
13,382
2015
14,481
MW
2014
Performance in 2015
millions of euro
Revenue 4,831
Romania
Russia
Slovakia
Other countries
1,004
1,062
2,401
364
Gross operating margin 1,308
Romania
Russia
Slovakia
Other countries
8,944
4,032
406
9,107
4,968
406
281
164
871
(8)
Electricity distribution networks
2015
Distribution lines
km
91,285
High voltage
Medium voltage
Low voltage
6,584
35,043
49,658
Capital expenditure 229 (1)
Romania
Russia
Other countries
116
112
1
(1) Does not include €648 million regarding units classified as “held for sale”.
10
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
61
Report on operationsAnnual Report 2015 Operations
Net electricity generation
Millions of kWh
Thermal
Nuclear
Hydroelectric
Other resources
Total net generation
- of which Russia
- of which Slovakia
- of which Belgium
2015
45,024
14,081
2,385
42
61,532
42,090
18,292
1,150
2014
44,229
14,420
Change
795
(339)
1.8%
-2.4%
4,225
(1,840)
-43.6%
52
(10)
-19.2%
62,926
(1,394)
42,376
(286)
-2.2%
-0.7%
20,550
(2,258)
-11.0%
-
1,150
-
Net electricity generation in 2015 amounted to 61,532
operation of the Gabcˇíkovo plant. The decrease was partly
million kWh, a decrease of 1,394 million kWh compared
offset by the generation in Belgium at the Marcinelle Ener-
with 2014. The change was mainly due to the decline in
gie thermal plant, which was operated until the end of 2014
generation in Slovakia from nuclear (-339 million kWh) and
through a tolling agreement by the “Italy” Country and is
hydroelectric (-1,840 million kWh) resources, the latter also
now included in the “Eastern Europe” Region.
resulting from the early termination of the contract for the
Contribution to gross thermal generation
Millions of kWh
High-sulfur fuel oil (S>0.25%)
Natural gas
Coal
Nuclear fuel
Total
2015
-
2014
Change
-
186
0.3%
(186)
-
25,552
40.7%
25,325
40.7%
22,098
35.2%
21,255
34.1%
227
843
0.9%
4.0%
15,146
24.1%
15,499
24.9%
(353)
-2.3%
62,796
100.0%
62,265
100.0%
531
0.9%
Gross thermal generation in 2015 increased by 531 million
tion from natural gas in Belgium and from coal in Russia was
kWh, totaling 62,796 million kWh. The increase in genera-
only partly offset by a reduction in the use of nuclear fuel.
62
Annual Report 2015 Net efficient generation capacity
MW
Thermal plants
Nuclear plants
Hydroelectric plants
Other resources
at Dec. 31, 2015 at Dec. 31, 2014
Change
9,950
1,814
1,590
28
10,310
(360)
-3.5%
1,814
2,329
28
-
-
(739)
-31.7%
-
-
Total net efficient capacity
13,382
14,481
(1,099)
- of which Russia
- of which Slovakia
- of which Belgium
8,944
4,032
406
9,107
4,968
406
(163)
(936)
-
-7.6%
-1.8%
-18.8%
-
Net efficient generation capacity decreased by 1,099 MW in
to operate the Gabcˇíkovo plant and the decommissioning
2015, mainly reflecting the early termination of the contract
of one of the units of the Vojany coal-fired plant in Slovakia.
Electricity distribution and transport networks
High-voltage lines at year-end (km)
Medium-voltage lines at year-end (km)
Low-voltage lines at year-end (km)
Total electricity distribution network (km)
Electricity transported on Enel’s distribution network (millions of kWh)
2015
6,584
35,043
49,658
91,285
14,582
2014
6,572
34,998
49,562
91,132
14,063
Change
12
45
96
153
519
0.2%
0.1%
0.2%
0.2%
3.7%
Electricity transported – entirely in Romania – increased by
sociated with newly-installed connections, which reflect the
519 million kWh (+3.7%), rising from 14,063 million kWh
growth in the electricity network in that country.
to 14,582 million kWh in 2015. The increase was mainly as-
Electricity sales
Millions of kWh
Free market
Regulated market
Total
- of which Romania
- of which France
- of which Slovakia
2015
10,407
5,353
15,760
7,691
3,966
4,103
2014
10,410
5,926
16,336
8,156
3,442
4,738
Change
(3)
(573)
(576)
(465)
-
-9.7%
-3.5%
-5.7%
524
15.2%
(635)
-13.4%
Electricity sold in 2015 decreased by 576 million kWh, from
nia, mainly due to the gradual liberalization of the market;
16,336 million kWh to 15,760 million kWh. The decline is
> an increase of 524 million kWh in quantities sold in France;
ascribable to:
> a decrease of 635 million kWh in sales in Slovakia, fol-
> a decrease of 465 million kWh in quantities sold in Roma-
lowing the trend in generation.
63
Report on operationsAnnual Report 2015
Performance
Millions of euro
Revenue
Gross operating margin
Operating income
Capital expenditure
(1) Does not include €648 million regarding units classified as “held for sale”.
The following tables show performance by country in 2015.
Revenue
Millions of euro
Romania
Russia
Slovakia
Other countries
Total
2015
2014 restated
Change
4,831
1,308
(499)
229 (1)
5,299
1,210
(468)
98
-8.8%
8.1%
(2,676)
2,177
-81.4%
936
(707)
-75.5%
2015
2014 restated
Change
1,004
1,062
2,401
364
4,831
1,021
1,494
2,494
290
5,299
(17)
(432)
(93)
74
(468)
-1.7%
-28.9%
-3.7%
25.5%
-8.8%
Revenue in 2015 amounted to €4,831 million, down €468
of the Gabcˇíkovo plant, in an environment of falling avera-
million (-8.8%) compared with the previous year. This re-
ge prices;
flected:
> a decrease of €17 million in revenue in Romania, essentially
> a decrease of €432 million in revenue in Russia, primarily
reflecting the contraction in volumes sold due to the libera-
due to the depreciation of the ruble against the euro (€357
lization of the market, the effect of which was only partly
million) and the decline in average electricity prices;
offset by the increase in amounts transported and a rise in
> a decrease of €93 million in revenue in Slovakia, attributa-
new connections;
ble to the contraction in volumes generated and sold, partly
> an increase of €74 million in revenue in Belgium as a result
reflecting the termination of the contract for the operation
of an increase in volumes produced.
Gross operating margin
Millions of euro
Romania
Russia
Slovakia
Other countries
Total
2015
2014 restated
Change
281
164
871
(8)
1,308
305
358
537
10
1,210
(24)
(194)
334
(18)
98
-7.9%
-54.2%
62.2%
-
8.1%
The gross operating margin amounted to €1,308 million,
in Slovakia, mainly due to the partial reversal of the pro-
an increase of €98 million compared with 2014. This mainly
vision for nuclear waste disposal charges (€550 million)
reflected:
following an analysis by independent experts, who took
> an increase of €334 million in the gross operating margin
account of the regulatory changes introduced in July 2015
64
Annual Report 2015
by the Slovakian government, which approved a new stra-
margin, caused by a decline in the sales prices of elec-
tegy for handling the “back end” of spent nuclear fuel,
tricity in conjunction with rising costs for the purchase
the measures of which include the postponement of the
of fuel, as well as exchange losses, which brought about
start of permanent storage of waste from 2037 to 2065.
a decrease of €55 million in the gross operating margin;
This was only partly offset by a decline in electricity sales
> a decrease of €24 million in the gross operating margin
prices;
in Romania, almost entirely due to electricity sales acti-
> a decrease of €194 million in the gross operating margin
vities, which reflected developments in electricity sales,
in Russia, mainly due to the contraction of the generation
and to a number of prior-year items recognized in 2014.
Operating income
Millions of euro
Romania
Russia
Slovakia
Other countries
Total
2015
168
(839)
184
(12)
(499)
2014 restated
Change
201
(201)
(2,605)
(71)
(2,676)
(33)
(638)
2,789
59
2,177
-16.4%
-
-
83.1%
81.4%
Operating income in 2015 showed a loss of €499 million,
continuation of adverse market conditions for the Enel
an improvement of €2,177 million compared with 2014,
Russia CGU (€899 million in 2015; €365 million in 2014);
mainly attributable to:
> a decrease in depreciation of property, plant and
> a reduction in impairment losses recognized following
equipment for Enel Russia of €79 million (€143 million in
adjustment of assets to their estimated realizable value
2014) and for Slovenské elektrárne of €93 million (€126
(determined on the basis of offers received and deve-
million in 2014);
lopments in the sales process) for Slovenské elektrár-
> exchange gains from translation of €282 million as a re-
ne (€574 million in 2015; €2,878 million in 2014) and on
sult of the depreciation of the ruble.
the basis of the outcome of impairment testing and the
Capital expenditure
Millions of euro
Romania
Russia
Slovakia
Other countries
Total
2015
2014 restated
Change
116
112
- (1)
1
229
83
188
665
-
936
33
(76)
(665)
1
(707)
39.8%
-40.4%
-
-
-75.5%
(1) Does not include €648 million regarding units classified as “held for sale”.
Capital expenditure amounted to €229 million, a decre-
to the classification under assets held for sale of Slovenské
ase of €707 million compared with the previous year. The
elektrárne. Excluding that reclassification, capital expendi-
change is attributable to higher costs incurred in Russia in
ture would have decreased by €59 million, of which €17
2014 to restore operations at the Sredneuralskay combined-
million regarding Slovakian plants, especially the Mochovce
cycle plant following the stoppage at the end of 2013 and
nuclear plant.
65
Report on operationsAnnual Report 2015
5
Renewable Energy
Net efficient generation capacity
10,470
2015
9,626
MW
2014
Performance in 2015
millions of euro
Geothermal
plants
833
Wind
plants
6,575
Hydroelectric
plants
2,624
Geothermal
plants
833
Wind
plants
5,696
Hydroelectric
plants
2,624
Revenue 3,011
Europe and North Africa
Latin America
North America
Sub-Saharan Africa and Asia
1,814
650
533
14
Other
resources
439
Other
resources
473
Gross operating margin 1,826
Europe and North Africa
Latin America
North America
Sub-Saharan Africa and Asia
Italy
Iberian Peninsula
Greece
Romania
and Bulgaria
Italy
Iberian Peninsula
Greece
Romania
and Bulgaria
1,105
364
352
5
3,044
1,705
290
576
3,133
1,836
290
576
Capital expenditure 2,466
United States
and Canada
Panama, Mexico,
Guatemala
and Costa Rica
Brazil
and Chile
Other countries
United States
and Canada
Panama, Mexico,
Guatemala
and Costa Rica
Brazil
and Chile
Other countries
Europe and North Africa
Latin America
North America
Sub-Saharan Africa and Asia
2,507
1,005
1,161
182
2,083
816
882
10
317
1,548
289
312
10
66
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
Annual Report 2015 5
Renewable Energy
Geothermal
plants
833
Wind
plants
6,575
Hydroelectric
plants
2,624
Geothermal
plants
833
Wind
plants
5,696
Hydroelectric
plants
2,624
Net efficient generation capacity
10,470
2015
9,626
MW
2014
Performance in 2015
millions of euro
Revenue 3,011
Europe and North Africa
Latin America
North America
Sub-Saharan Africa and Asia
1,814
650
533
14
Other
resources
439
Other
resources
473
Gross operating margin 1,826
Europe and North Africa
Latin America
North America
Sub-Saharan Africa and Asia
Italy
Iberian Peninsula
Greece
Italy
Iberian Peninsula
Greece
Romania
and Bulgaria
Romania
and Bulgaria
1,105
364
352
5
3,044
1,705
290
576
3,133
1,836
290
576
Capital expenditure 2,466
United States
and Canada
Panama, Mexico,
Guatemala
Brazil
United States
and Canada
Panama, Mexico,
Guatemala
Brazil
and Costa Rica
and Chile
Other countries
and Costa Rica
and Chile
Other countries
Europe and North Africa
Latin America
North America
Sub-Saharan Africa and Asia
2,507
1,005
1,161
182
2,083
816
882
10
317
1,548
289
312
10
Relazione finanziaria annuale 2015
Relazione sulla gestione
11
67
Report on operationsAnnual Report 2015 Operations
Net electricity generation
Millions of kWh
Hydroelectric
Geothermal
Wind
Other resources
Total net generation
- of which Italy
- of which Iberian Peninsula
- of which France
- of which Greece
- of which Romania and Bulgaria
- of which United States and Canada
- of which Panama, Mexico, Guatemala and Costa Rica
- of which Brazil and Chile
- of which other countries
2015
10,426
6,205
16,066
876
33,573
13,076
4,383
-
549
1,420
7,368
3,841
2,869
67
2014
11,452
5,954
13,896
496
31,798
14,117
4,359
347
488
1,351
6,674
2,904
1,550
8
Change
(1,026)
251
2,170
380
1,775
(1,041)
24
(347)
61
69
694
937
1,319
59
-9.0%
4.2%
15.6%
76.6%
5.6%
-7.4%
0.6%
-
12.5%
5.1%
10.4%
32.3%
85.1%
-
Net electricity generation by the Division totaled 33,573
generation following the disposal of operations in France at
million kWh in 2015, an increase of 1,775 million kWh on
the end of 2014 (-347 million kWh).
2014. The increase is attributable to an increase of 2,816
Net electricity generation in Italy in 2015 decreased by
million kWh in generation abroad, mainly from the increase
1,041 million kWh on 2014, primarily reflecting the contrac-
in wind generation in Latin America (+1,691 million kWh)
tion in hydroelectric output (-841 million kWh) owing to po-
and North America (+769 million kWh), as a result of the
orer water conditions. That decrease was partly offset by
expansion of installed capacity, hydroelectric generation
the increase in geothermal generation (+261 million kWh)
in Panama (+527 million kWh) thanks to better water con-
due to the expansion in installed capacity since the Bagno-
ditions and solar generation in Chile (+233 million kWh).
re plant was put into service.
These factors were only partly offset by the decline in wind
Net efficient generation capacity
MW
Hydroelectric plants
Geothermal plants
Wind plants
Other resources
Total net efficient capacity
- of which Italy
- of which Iberian Peninsula
- of which Greece
- of which Romania and Bulgaria
- of which United States and Canada
- of which Panama, Mexico, Guatemala and Costa Rica
- of which Brazil and Chile
- of which other countries
68
at Dec. 31, 2015 at Dec. 31, 2014
Change
2,624
833
6,575
439
10,470
3,044
1,705
290
576
2,507
1,005
1,161
182
2,624
833
5,696
473
9,626
3,133
1,836
290
576
2,083
816
882
10
-
-
879
(34)
844
(89)
(131)
-
-
424
189
279
172
-
-
15.4%
-7.3%
8.8%
-2.8%
-7.1%
-
-
20.4%
23.2%
31.6%
-
Annual Report 2015
Net efficient generation capacity increased by 844 MW, of
Brazil (118 MW), Chile (61 MW) and Uruguay (50 MW). The-
which 933 MW abroad. More specifically, the increase in
se effects were only partly offset by the decrease in instal-
net installed wind capacity was mainly attributable to new
led capacity due to the disposal of wind plants in Portugal
plants in the United States (424 MW), Mexico (202 MW),
and solar plants in Italy.
Performance
Millions of euro
Revenue
Gross operating margin
Operating income
Capital expenditure
The following tables show performance by geographical area in 2015.
Revenue
Millions of euro
Europe and North Africa
Latin America
North America
Sub-Saharan Africa and Asia
Total
2015
2014 restated
Change
3,011
1,826
879
2,466
2,921
1,938
1,124
1,658
90
(112)
(245)
808
3.1%
-5.8%
-21.8%
48.7%
2015
2014 restated
Change
1,814
1,985
(171)
650
533
14
537
396
3
3,011
2,921
113
137
11
90
-8.6%
21.0%
34.6%
-
3.1%
Revenue in 2015 amounted to €3,011 million, an increase of
Africa, mainly due to a reduction in revenue from the electri-
€90 million (+3.1%) compared with the previous year. This
city sales in Italy in reflection of the decline in hydroelectric
is the result of:
generation and the change in the scope of consolidation as
> an increase of €137 million in revenue in North America,
a result of the disposal of Enel Green Power France in De-
primarily due to the positive impact of the appreciation of
cember 2014. This was partly offset by the positive effects
the US dollar against the euro (€88 million), the increase in
of the acquisition of control of 3Sun (€117 million in respect
volumes generated, a rise in income from tax partnerships
of negative goodwill and the remeasurement at fair value of
and the increase in other revenue as a result of the disposal
the Group’s previous interest in the company), the consoli-
of certain assets;
dation of a number of projects held by the Portugal-based
> an increase of €113 million in revenue in Latin America, lar-
ENEOP consortium (gains and remeasurement at fair value
gely due to an increase in generation in Chile, Mexico and
for a total €29 million) and the recognition of the indemnity
Costa Rica (totaling €102 million);
provided for in the agreement with STM (€12 million).
> a decrease of €171 million in revenue in Europe and North
69
Report on operationsAnnual Report 2015 Gross operating margin
Millions of euro
Europe and North Africa
Latin America
North America
Sub-Saharan Africa and Asia
Total
2015
1,105
364
352
5
1,826
2014 restated
Change
1,461
202
276
(1)
1,938
(356)
162
76
6
(112)
-24.4%
80.2%
27.5%
-
-5.8%
The gross operating margin in 2015 amounted to €1,826
electricity in Brazil and Panama; in Panama, better water
million, a decrease of €112 million (-5.8%) compared with
conditions helped reduce the costs of purchasing electri-
2014. The decrease is attributable to:
city in order to honor sales contracts. The increase was
> a decrease of €355 million in the gross operating margin
partly offset by higher operating costs due to the expan-
in Europe, mainly due to the decrease in revenue as a
sion in installed capacity in Brazil, Chile and Mexico;
result of lower average sales prices and the increase in
> an increase of €76 million in the gross operating margin
costs due to the formalization of a number of agreements
in North America – taking account of favorable exchan-
for the early retirement of personnel in Italy;
ge rate developments for €58 million – reflecting the in-
> an increase of €162 million in the gross operating margin
crease in revenue, only partly offset by the increase in
in Latin America – taking account of favorable exchange
personnel costs and operating costs associated with the
rate developments for €36 million – reflecting the incre-
expansion of installed capacity.
ase in revenue and the reduction in costs of purchasing
Operating income
Millions of euro
Europe and North Africa
Latin America
North America
Sub-Saharan Africa and Asia
Total
2015
2014 restated
Change
459
249
168
3
879
834
142
149
(1)
1,124
(375)
107
19
4
(245)
-45.0%
75.4%
12.8%
-
-21.8%
Operating income in 2015 amounted to €879 million, a
ket and regulatory scenario in the renewables sector in that
decrease of €245 million, taking account of a rise of €133
country. Other factors included the writedown of a num-
million in depreciation, amortization and impairment losses,
ber of specific assets of 3Sun, the expansion of installed
mainly due to the impairment loss on the residual goodwill
capacity on the American continent, value adjustments of
and property, plant and equipment of Enel Green Power
specific projects in North America and the writedown of
Romania (€155 million) as a result of the unfavorable mar-
receivables in the Europe region.
Capital expenditure
Millions of euro
Europe and North Africa
Latin America
North America
Sub-Saharan Africa and Asia
Total
70
2015
317
1,548
289
312
2,466
2014 restated
Change
373
927
332
26
1,658
(56)
621
(43)
286
808
-15.0%
67.0%
-13.0%
-
48.7%
Annual Report 2015
Capital expenditure in 2015 amounted to €2,466 million,
(€151 million), photovoltaic plants in Chile (€344 million) and
an increase of €808 million on the previous year. Capital
South Africa (€194 million) and hydroelectric plants in Brazil
expenditure mainly regarded wind plants in Latin America
and Costa Rica (€221 million).
(€822 million), North America (€257 million) and Europe
Other, eliminations and adjustments
Operations
Hydrocarbon reserves and annual output
Hydrocarbon reserves:
Proven reserves (P1) of hydrocarbons at the end of the year (millions of barrels
of oil equivalent)
Proven and probable reserves (2P) of hydrocarbons at the end of the year
(millions of barrels of oil equivalent)
Contingent resources (2C) of gas (millions of barrels of oil equivalent)
2015
2014
Change
16
42
4
18
46
-
(2)
(4)
4
Projects under developments at the end of 2015 were lo-
ble (2012 for Isarene and 2015 for Enel Longanesi Deve-
cated as follows:
lopment), Enel’s interest in 2015 amounted to:
> in Algeria, where the Group, through Enel Trade, holds
> 16.3 million barrels of oil equivalent of proven reserves
a stake of 18.4% of the “Isarene” permit in partnership
(P1), of which:
with Petroceltic International and Sonatrach (an Algerian
- 15.9 million barrels of oil equivalent for the Isarene field;
state-owned company);
- 0.4 million barrels of oil equivalent for the Enel Longa-
> in Italy, where the Group, through Enel Longanesi Deve-
nesi Development field;
lopment, holds 33.5% of the hydrocarbon extraction per-
> 42.1 million barrels of oil equivalent of proven and proba-
mit at Bagnacavallo.
ble reserves (2P) of which:
The Upstream Gas Division continued the process of cer-
- 41.6 million barrels of oil equivalent for the Isarene field;
tifying the reserves of the assets it had under development.
- 0.5 million barrels of oil equivalent for the Enel Longa-
More specifically, following the acquisition and analysis
nesi Development field.
of the seismic data for the Enel Longanesi Development
The new certification of part of the 2P reserves certified
project, a new assessment was performed in 2015 by an
part of the reserves as contingent resources (3.7 million
external certifier.
barrels of oil equivalent).
On the basis of the most recent assessments availa-
Performance
Millions of euro
Revenue (net of eliminations)
Gross operating margin
Operating income
Capital expenditure
2015
2014 restated
Change
852
(213)
(338)
52
1,025
(29)
(68)
45
(173)
(184)
(270)
-16.9%
-
-
7
15.6%
Revenue net of eliminations in 2015 totaled €852 million,
Excluding the income (equal to €82 million) from the
a decrease of €173 million on the previous year (-16.9%).
adjustment of the price in the 1st Quarter of 2014 on the
71
Report on operationsAnnual Report 2015 sale of Artic Russia in 2013 with respect to the earn-out clau-
der Article 4 of the Fornero Act and the payment of a lump-
se contained in contracts with the buyer of that company,
sum benefit to retired employees who had been receiving
revenue decreased by €91 million compared with 2014. The
the energy discount following revocation of that benefit,
latter decrease is largely attributable to a decrease of €116
partly offset by a corresponding reversal of the associated
million in revenue from engineering activities as a result of a
provision. This effect was accompanied by a contraction in
decline in operations in 2015 compared with 2014 (including
unit margins on certain services provided to other Group Di-
the Porto Empedocle liquefied natural gas regasification ter-
visions.
minal and the Mochovce nuclear plant). This was only partly
offset by increased revenue (€24 million) for information and
Operating income in 2015 showed a loss of €338 million,
communication technology services.
a deterioration of €270 million on the previous year, taking
The gross operating margin in 2015, a loss of €213 million,
tization and impairment losses, essentially reflecting the
deteriorated by €184 million compared with 2014. Excluding
impairment of €159 million recognized on upstream gas ex-
the effect of the price adjustment noted above, the gross
ploration assets as a result of difficulty encountered in conti-
operating margin deteriorated by €106 million. This reflected
nuing projects and developments in the price scenario in the
account of an increase of €86 million in depreciation, amor-
the increase in costs following the new agreement with the
global fuel market.
trade unions for early retirement incentives for personnel un-
Capital expenditure
Capital expenditure in 2015 amounted to €52 million, an increase of €7 million on 2014.
72
Annual Report 2015 Performance and financial position
of Enel SpA
Performance
The following table summarizes the performance of Enel SpA in 2015 and 2014.
Millions of euro
Revenue
Revenue from services
Other revenue and income
Total
Costs
Consumables
Services, leases and rentals
Personnel
Other operating expenses
Total
Gross operating margin
Depreciation, amortization and impairment losses
Operating income
Net financial income/(expense) and income from equity investments
Income from equity investments
Financial income
Financial expense
Total
Income before taxes
Income taxes
NET INCOME FOR THE YEAR
2015
2014
Change
237
8
245
1
199
176
24
400
(155)
327
(482)
2,024
3,535
4,267
1,292
810
(201)
1,011
245
1
246
2
185
120
19
326
(80)
543
(623)
1,818
2,412
3,331
899
276
(282)
558
(8)
7
(1)
(1)
14
56
5
74
(75)
(216)
141
206
1,123
936
393
534
81
453
Revenue from services totaled €237 million (€245 million in
Costs for consumables amounted to €1 million in 2015,
2014) and essentially regards services provided to subsidiari-
down €1 million on 2014. They are accounted for by purcha-
es as part of Enel SpA’s direction and coordination functions
ses of consumables from third-party suppliers.
and the rebilling of costs incurred by Enel SpA but pertaining
to the subsidiaries.
Costs for services, leases and rentals amounted to €199
The decrease of €8 million is mainly attributable to a decline
million in 2015, of which charges from third parties in the
in pass-through rebilling of a number of Group companies
amount of €126 million and from Group companies in the
for management fees and technical fees, partly offset by an
amount of €73 million. The costs attributable to third par-
increase in revenue from communication activities.
ties mainly regarded communication expenses, technical
Other revenue and income came to €8 million, up €7 mil-
and corporate organization consulting. Those in respect of
lion on the previous year. The item is essentially composed
services provided by Group companies regard IT and admi-
of the rebilling of costs for the personnel of Enel SpA secon-
nistrative services and purchasing, as well as rentals and
ded to other Group companies.
personnel training received from Enel Italia Srl, and costs for
and professional services as well as strategic, management
Report on operation
73
Annual Report 2015 the personnel of a number of Group companies seconded to
Net financial expense amounted to €732 million and es-
Enel SpA. The total change compared with 2014 amounted
sentially reflects interest expense on financial debt (€956
to €14 million and is essentially attributable to higher costs
million), offset by net income on interest rate derivatives
in respect of IT assistance services and personal services
(€57 million) and interest and other income on financial as-
rendered by Enel Italia Srl and higher costs registered in re-
sets (totaling €160 million).
spect of Enel Iberoamérica SL for personnel seconded to
The decrease in net financial expense on the previous year,
global service activities.
equal to €187 million, was essentially the result of a decline
Personnel costs totaled €176 million in 2015, an increase
payment of a number of bonds during the year and the net
of €56 million on the previous year. The rise is essentially
positive changes in derivatives transactions relating to Enel
in interest on financial debt (€82 million) following the re-
attributable to the increase in “wages and salaries” and the
SpA (€98 million).
associated social security contributions (a total of €32 mil-
lion) as a result of the increase in the average workforce and
Income taxes showed a tax receivable of €201 million,
to the costs of the new agreements for the early retirement
mainly due to the reduction in taxable income for IRES pur-
of personnel under Article 4 of the Fornero Act (€31 million),
poses compared with statutory taxable income as a result
partly offset by the decrease in other costs as a result of
of the exclusion of 95% of dividends received from subsi-
the unilateral revocation of the electricity discounts formerly
diaries and the deductibility of Enel SpA interest expense for
granted to retired personnel, with the reversal of the asso-
the Group’s consolidated taxation mechanism in accordance
ciated provision at December 31, 2015 (€10 million).
with corporate income tax law (Article 96 of the Uniform
Other operating expenses amounted to €24 million in
rence between the two years in the amount of dividends
2015, up €5 million compared with 2014, mainly due to the
received from subsidiaries and the non-deductibility of im-
allocation of €3 million to the provision for “compensation
pairment losses on equity investments in 2015 meeting the
and elimination of retired employee electricity discount”
requirements of Article 87 of the Uniform Income Tax Code.
Income Tax Code). This essentially reflected both the diffe-
established at December 31, 2015.
The gross operating margin was a negative €155 million,
with €558 million the previous year.
Net income for the year totaled €1,011 million, compared
a deterioration of €75 million on the previous year, mainly
attributable to the increase in personnel costs and rental and
lease costs.
Depreciation, amortization and
impairment
losses
amounted to €327 million in 2015, a decrease of €216 million
compared with 2014. The change is attributable to the decli-
ne in impairment losses on equity investments in 2015 from
the previous year, which regarded the value adjustment of
the interests in Enel Trade SpA (€250 million) and Enel Inge-
gneria e Ricerca SpA (€65 million).
The operating result showed a loss of €482 million, an im-
provement of €141 million compared with 2014.
Income from equity investments amounted to €2,024 mil-
lion. The item regards dividends approved in 2015 by subsi-
diaries, associates and other companies (€1,818 million in
2014) and shows an increase of €206 million on the previous
year, essentially due to the special dividend paid by Enel Ibe-
roamérica SL (€479 million).
74
Annual Report 2015 Analysis of the financial position
Millions of euro
Net non-current assets:
- property, plant and equipment and intangible assets
- equity investments
- net other non-current assets/(liabilities)
Total
Net current assets:
- trade receivables
- net other current assets/(liabilities)
- trade payables
Total
Gross capital employed
Provisions:
- employee benefits
- provisions for risks and charges and net deferred taxes
Total
Net capital employed
Shareholders’ equity
NET FINANCIAL DEBT
at Dec. 31, 2015
at Dec. 31, 2014
Change
21
38,984
71
39,076
283
(627)
(164)
(508)
19
38,754
(299)
38,474
132
(533)
(139)
(540)
38,568
37,934
(291)
28
(263)
38,305
24,880
13,425
(302)
115
(187)
37,747
25,136
12,611
2
230
370
602
151
(94)
(25)
32
634
11
(87)
(76)
558
(256)
814
Net non-current assets amounted to €39,076 million, an in-
with the consolidated taxation mechanism (€196 million);
crease of €602 million. The change is essentially attributable
> an increase of €25 million in trade payables.
to the following factors:
> an increase of €230 million in investments in subsidiaries,
Net capital employed at December 31, 2015, came to
reflecting the following transactions: the recapitalization
€38,305 million, funded by shareholders’ equity of €24,880
of Enel Trade SpA (€500 million) and Enel Ingegneria e
million and net financial debt of €13,425 million.
Ricerca SpA (€40 million), with the former subsequently
written down by €250 million and the latter by €65 million;
Shareholders’ equity came to €24,880 million at December
the establishment of Enel Open Fiber SpA, with payment
31, 2015, a decrease of €256 million on the previous year.
of share capital of €5 million, entirely owned by Enel SpA;
The change is attributable to the distribution of the dividend
> an increase of €370 million in “net other non-current as-
for 2014 of €1,316 million (€0.14 per share) and the recogni-
sets”, essentially due to the increase in the value of non-
tion of net income for the year of €1,060 million (including an
current derivatives.
income recognized directly in equity of €49 million, largely
attributable to the change, net of tax effects, of the reserve
Net current assets came to a negative €508 million, a de-
for cash flow hedge derivatives).
crease of €32 million on December 31, 2014. The change
reflects:
Net financial debt amounted to €13,425 million, with a
> an increase of €151 million in trade receivables, mainly
debt/equity ratio of 53.9% (50.2% at the end of 2014).
from Group companies, for management and coordina-
tion services from Enel SpA. The change reflected de-
velopments in revenue from such services and the mo-
dification of the timing of receipts compared with the
previous year;
> an increase of €94 million in “net other current liabilities”,
mainly in respect of the decrease in the income tax re-
ceivables of Enel SpA (€306 million), partly offset by an
increase in intercompany IRES receivables connected
Report on operation
75
Annual Report 2015
Analysis of the financial structure
Net financial debt and changes in the period are detailed in the table below.
(2,785)
(2,785)
(1)
45
(2,741)
699
(1)
(500)
1,246
1,444
(46)
(5)
586
529
1,047
3,555
814
Millions of euro
Long-term debt:
- bonds
Long-term debt
- financial receivables from others
- debt assumed and loans to subsidiaries
Net long-term debt
Short-term debt/(liquidity):
at Dec. 31, 2015
at Dec. 31, 2014
Change
14,503
14,503
(5)
(72)
14,426
17,288
17,288
(4)
(117)
17,167
- short-term portion of long-term borrowings
3,062
2,363
- short-term bank borrowings
- short-term debt due to Group companies
- cash collateral received
Short-term debt
- short-term portion of loans assumed/granted
- other short-term financial receivables
- cash collateral paid
- net short-term financial position with Group companies
- cash and cash equivalents and short-term securities
Net short-term debt/(liquidity)
NET FINANCIAL DEBT
2
-
1,669
4,733
(46)
(8)
(86)
331
(5,925)
(1,001)
13,425
3
500
423
3,289
-
(3)
(672)
(198)
(6,972)
(4,556)
12,611
Net financial debt at December 31, 2015 amounted to €13,425
> the repayment of two tranches of the Ina and Ania bonds
million, an increase of €814 million, the result of a decrease
and the repurchase of own bonds in the total amount of
in the net short-term creditor position (€3,555 million) and a
€94 million.
decrease in net long-term financial debt (€2,741 million).
The main transactions in 2015 impacting debt can be sum-
Cash and cash equivalents amounted to €5,925 million, a
marized as follows:
decrease on December 31, 2014 of €1,047 million, mainly
> the repayment of €2,300 million on two retail bonds;
attributable to the above bond repayments and normal cen-
> the repayment of €500 million on the Intercompany Short
tral treasury functions performed by Enel SpA.
Term Deposit Agreement (a short-term credit facility with
Enel Finance International NV);
76
Annual Report 2015 Cash flows
Millions of euro
Cash and cash equivalents at the start of the year
Cash flows from operating activities
Cash flows from investing/disinvesting activities
Cash flows from financing activities
Cash and cash equivalents at the end of the year
2015
6,972
1,062
(560)
(1,549)
5,925
2014
3,123
926
(11)
2,934
6,972
Change
3,849
136
(549)
(4,483)
(1,047)
Cash flows from operating activities came to a positive
Cash flows in respect of financing activities were a negative
€1,062 million (€926 million in 2014), essentially attributa-
€1,549 million (a positive €2,934 million in 2014). They were
ble to dividends from subsidiaries, the net negative balance
essentially generated by the repayment of bonds and the
of interest paid and collected and payments on account of
repurchase of own bonds in the amount of €2,394 million,
IRES on behalf of all Group companies participating in the
the payment of dividends for 2014 totaling €1,316 million
consolidated taxation mechanism.
and the net increase of €2,508 million in net short-term fi-
Cash flows from investing activities were a negative €560
nancial debt.
million (a negative €11 million in 2014). They include €542
In 2015, the cash requirements generated by financing acti-
million in respect of the recapitalization of the subsidiaries
vities (€1,549 million) and investing activities (€560 million)
Enel Trade SpA, Enel Ingegneria e Ricerca SpA and Enel Oil
were funded by €1,062 million from liquidity generated by
& Gas SpA, €5 million for the establishment of Enel Open
operating activities and €1,047 million from the use of cash
Fiber SpA and €15 million for investments in property, plant
and cash equivalents accumulated the previous year. Con-
and equipment and intangible assets. Disinvesting activities
sequently, cash and cash equivalents at December 31, 2015
regarded the transfer to Enel Trade SpA of the interest in
amounted to €5,925 million, compared with €6,972 million
Enel Oil & Gas SpA, which generated cash flows of €2 mil-
at the start of the year.
lion.
Report on operation
77
Annual Report 2015 Significant events in 2015
12
January
Enel Green Power extends
framework agreement with
Vestas to develop additional wind
capacity in the United States
26
January
New bond issue of up to €1
billion to back exchange offers
for existing bonds is authorized
On January 12, 2015, Enel Green Power, acting throu-
On January 26, 2015, the Board of Directors authorized one
gh its subsidiary Enel Green Power North America Inc.
or more new bond issues, to be carried out by December
(“EGPNA”), extended the framework agreement signed at
31, 2015, with a total maximum principal amount of up to €1
the end of 2013 with Vestas for the development of wind
billion.
farms in the United States. The 2013 agreement, which pro-
The authorization is intended to allow Enel to make new bond
vided for Vestas to supply wind turbines, has supported and
issues to serve any exchange offers for bonds previously is-
will continue to support EGPNA’s successful growth in the
sued by the Company under the Global Medium-Term Notes
United States.
Program, in order to optimize the Enel Group’s capital and
The capacity yet to be developed under the 2013 agreement,
financial structure and to permit it to seize any opportunities
together with the current extension, will enable EGPNA to
that may arise in international financial markets.
qualify up to approximately 1 GW of future wind capacity in
the United States for Federal Production Tax Credits (PTCs).
27
January
Exchange of bonds and issue of
new bonds
On January 27, 2015, Enel Finance International NV (“EFI”),
a wholly-owned subsidiary of Enel SpA, following a non-
binding public exchange offer that ran from January 14 to
January 21, purchased bonds issued by EFI and guaranteed
by Enel in the total amount of €1,429 million. The considera-
78
Annual Report 2015 tion for the purchase was represented by (i) senior fixed-rate
basis points, while the commitment fee has been reduced
notes with a minimum lot size of €100,000 (and multiples of
to 35% of the spread from the previous 40%, i.e. from 76
€1,000) issued by EFI (under the Global Medium-Term No-
basis points to 28 basis points.
tes Program of EFI and Enel) and guaranteed by Enel, in the
A number of Italian and foreign banks were involved in the
principal amount of €1,463 million and (ii) cash in the amount
transaction, with Mediobanca serving as the documentation
of €194 million.
agent.
The transaction was carried out as part of the optimization
of EFI’s financial management. It is intended to pursue ac-
tive management of the Group’s maturity structure and the
cost of funds. The new notes, which EFI issued as part of
the exchange offer under the Global Medium-Term Notes
Program with an Enel guarantee, bear an interest rate of
25
February
Updates of disposal plan
1.966% and mature on January 27, 2025.
On February 25, 2015, the Enel Board of Directors examined
29
January
Disposal of SF Energy
the updates of the plan for disposals of the Group’s equity
investments in Eastern Europe, announced to the market
on July 10, 2014. Under the strategic guidelines set out in
the new business plan to be presented to the financial com-
munity, it decided to suspend the process of disposing of
the distribution and sales assets in Romania and to continue
On January 29, 2015, the agreement signed on November 7,
with the disposal of the generation assets held in Slovakia.
2014 by Enel Produzione, a subsidiary of Enel, for the sale of
its stake in SF Energy was finalized at a price of €55 million.
Of the entire stake, 50% was sold to SEL - Società Elet-
trica Altoatesina (the counterparty in the agreement), while
the remaining 50% was sold to Dolomiti Energia following
exercise of its pre-emption rights. The disposal is part of the
18
March
Memorandum of understanding
with ENEA
agreements signed on that date between Enel Produzione
On March 18, 2015, Enel and ENEA signed a memorandum of
and SEL.
12
February
Renegotiation of revolving
credit facility of about €9.4
billion
understanding to innovate together in the generation techno-
logy sector, with a focus on renewables. The agreement pro-
vides for the parties to collaborate on technologies for the use
of alternative fuels in traditional plants, such as biomass and
plant waste, as well as on the development of technologies
for the environment, the climate and to enhance the flexibility
of using traditional power plants. A separate line of research
On February 12, 2015, Enel SpA and its Dutch subsidiary
will seek to optimize solutions to generate electricity from
Enel Finance International renegotiated the revolving credit
wave motion in the sea, while other work will focus on new
facility of about €9.4 billion agreed on February 8, 2013, re-
generation photovoltaic technology. Two Enel-ENEA working
ducing its cost and extending the facility’s maturity to 2020
groups have been formed to address these research areas,
from the original expiry date of April 2018.
with the aim of developing a joint detailed work plan on issues
The credit facility, which can be used by Enel and/or by Enel
of common interest within six months. Following this initial
Finance International with a Parent Company guarantee, is
exploratory phase, efforts will shift to implementing the activi-
not connected with the Group’s debt refinancing program.
ties of common interest.
It is intended to provide the Group’s treasury with an extre-
mely flexible and practical instrument for managing working
capital.
The cost of the credit facility varies in relation to Enel’s credit
rating and bears a spread on Euribor that, based upon Enel’s
current rating, falls to 80 basis points from the previous 190
79
Report on operationsAnnual Report 2015 31
March
30
March
Loan for operations
in South Africa
On March 30, 2015, Enel Green Power, acting through its
subsidiary Enel Green Power RSA, signed a loan agreement
for a total of 2,100 million South African rand (equivalent to
of this nature for its North American subsidiary’s obligations
under this agreement.
1
April
Enel Green Power - Marubeni
agreement on Asia-Pacific
renewables cooperation
about €160 million) with KfW IPEX-Bank, the latter as lender,
On April 1, 2015, Enel Green Power and Japan-based Ma-
sole lead arranger and agent, with partial credit insurance
rubeni Corporation signed a two year memorandum of un-
coverage provided by the German export credit agency, Eu-
derstanding (MoU) to jointly evaluate potential business op-
ler Hermes. The loan, secured by a parent company guaran-
portunities in renewable projects mainly in the Asia-Pacific
tee from Enel Green Power, will provide Enel Green Power
region. Cooperation under the MoU will focus on geother-
RSA with two separate lines of financing, with maturities of
mal, wind, solar and hydro projects mainly located in the Phi-
7 and 17 years respectively, bearing an interest rate in line
lippines, Thailand, India, Indonesia, Vietnam, Malaysia and
with the market benchmark. The loan will be used to finance
Australia as well as other areas that may be identified at a
the investment in the Gibson Bay wind farm, located in Ea-
later stage. Only projects in the development phase will be
stern Cape Province of South Africa. The plant will have 37
considered, therefore excluding projects under construction
turbines with a capacity of 3 MW each, for a total installed
and operating assets from the scope of the cooperation.
capacity of 111 MW and capable of generating about 420
GWh of power a year.
13
April
Award of South African public
tender for renewables
Disposal of certain assets
in North America
On April 13, 2015, Enel Green Power was awarded the right
to enter into power supply contracts with the South Afri-
On March 31, 2015, Enel Green Power North America
can utility Eskom for 425 MW of wind power projects in
(“EGPNA”) entered into an agreement with General Electric
the fourth phase of the Renewable Energy Independent Po-
(GE) Energy Financial Services for the sale of a 49% sta-
wer Producer Procurement Programme (REIPPPP) tender,
ke in a newly created company, EGPNA Renewable Energy
sponsored by the South African government. In line with
Partners (“EGPNA REP”), for a total of approximately $440
REIPPPP rules, Enel Green Power took part in the tender
million. EGPNA REP owns generation assets totaling 560
through vehicle companies in which it holds the majority of
MW of capacity, with a mix of already operational generation
the shares, in partnership with major local players.
technologies including wind, geothermal, hydro and solar. It
The three wind projects (Oyster Bay - 142 MW, Nxuba - 141
also owns a 200 MW wind plant now under construction. All
MW and Karusa - 142 MW) will be constructed in the Eastern
of the assets are located in North America. Within the new
Cape and Northern Cape Provinces, in areas with abundant
company, in addition to a minority stake, GE Energy Financial
wind resources. The Oyster Bay and Nxuba projects will be
Services will also receive, for an initial period of three years,
completed and enter service in 2017, while Karusa will enter
a right of first refusal to invest in operating assets developed
service in 2018. Once fully operational, the three projects,
out of EGPNA’s project pipeline and other operating assets
which will require a total investment of about €500 million,
offered for sale by EGPNA. The $440 million is subject to
will be able to generate around 1,560 GWh per year, thereby
certain price adjustments, customary for transactions of
significantly contributing to meeting the rising demand for
this nature. The amount associated with plants in operation
energy in South Africa in a way that is sustainable for the
was paid immediately, while the closing for the plant under
environment.
construction will take place once it enters service, which is
scheduled for the end of the year. Enel Green Power provi-
Subsequently, on June 10, 2015, Enel Green Power was
ded parent company guarantees customary for transactions
awarded the right to sign two 20-year electricity supply con-
80
Annual Report 2015 tracts with South African utility Eskom for an additional 280
rate reorganization, in compliance with the applicable law.
MW of wind power projects under the same conditions as
the REIPPPP tender. More specifically, the Soetwater (142
MW) and Garob (138 MW) wind farms, which will be built in
areas of the Northern Cape Province, will be completed and
enter operation by 2018 for a total investment of approxima-
tely €340 million. Once completed, the two facilities will be
5
May
Standard & Poor’s changes its
outlook for Enel
able to generate around 1,000 GWh per year.
On May 5, 2015, Standard & Poor’s announced that it had
15
April
Disposal of stake in SE
Hydropower
revised its outlook for Enel from stable to positive. The rating
agency noted that the positive outlook reflected the excep-
tional resilience the Group has shown in the adverse eco-
nomic and regulatory climate in the key mature markets in
which it operates (Italy and Spain). In particular, the agency
found that Enel’s credit metrics could improve over the re-
On April 15, 2015, the sale by Enel Produzione of a 40%
ference period (2015-2017) thanks to the actions envisaged
stake in SE Hydropower for a price of €345 million, pursuant
in the strategic plan, including the asset disposal strategy,
to the agreement signed on November 7, 2014, was comple-
the rationalization of operating expenses, the flexibility of
ted. The stake was sold to SEL - Società Elettrica Altoatesina
investments and the optimization of debt and cash flow ma-
SpA upon meeting the final condition precedent set forth in
nagement.
the agreement.
The sale falls within the scope of the agreements signed
on the same date by Enel Produzione and SEL and already
announced by Enel to the market.
7
May
22
April
Rationalization of Latin
American companies
Award of renewable energy
tender in Turkey
On May 7, 2015, Enel Green Power entered the Turkish re-
newable energy market after being awarded, through its
wholly-owned subsidiary Vektor SA, the right to enter into
a power supply contract with the 23 MW Isparta solar pho-
On April 22, 2015, the Board of Directors of Enel examined
tovoltaic project. The electricity produced by the Isparta so-
and agreed upon the possibility that the boards of directors
lar park will be sold to a subsidiary of TEIAS under the go-
of Enersis and its subsidiaries Empresa Nacional de Electri-
vernment’s feed-in-tariff system. The Isparta facility, which
cidad (“Endesa Chile”) and Chilectra could begin assessing
is expected to be completed and enter service in 2018, will
a corporate reorganization to separate power generation and
be able to generate more than 35 GWh per year once fully
distribution activities in Chile from those in the other Latin
operational, significantly contributing to meeting the rising
American countries. This initiative is part of the previously
demand for energy in Turkey with an environmentally sustai-
announced Group rationalization and simplification program.
nable solution.
The reorganization would eliminate a number of duplications
and overlaps among the companies that report to Enersis,
which are impeding the full valuation of the associated as-
sets for all shareholders, reducing the visibility of the various
businesses and making the decision-making process unne-
cessarily complex. Clearly differentiating operations in Chile
11
May
Memorandum
of understanding with Terna
from those in other Latin American countries would facilitate
On May 11, 2015, Enel and Terna signed a memorandum of
value creation for Enersis, Endesa Chile and Chilectra, and
understanding (MoU) for cooperation in identifying, asses-
all of their shareholders. The competent bodies of Enersis,
sing and developing integrated initiatives and opportunities
Endesa Chile and Chilectra will assess the possible condi-
in greenfield (for the creation of new assets) and/or brown-
tions and procedures for the implementation of the corpo-
field (for the acquisition of existing assets) projects related
81
Report on operationsAnnual Report 2015 to transmission systems in the countries – with the excep-
tion of Italy – where Enel and Terna have a strategic or com-
mercial interest. More specifically, outside of Italy, Enel is
interested, including through Group companies, in the acqui-
sition, development and operation of projects regarding hi-
12
May
Construction of a co-generation
plant in Mexico
gh-voltage transmission or connection grids in the countries
On May 12, 2015, the Enel Group, in partnership with Aben-
it operates in, including those integrated with power genera-
goa, a company that specializes in innovative technological
tion or distribution operations, through both the construction
solutions aimed at sustainable energy development, was
of new assets and the acquisition of existing assets. At the
selected by Mexican oil and gas company Pemex to develop
same time, Terna is interested in providing technical coope-
a 517 MW power and 850 tons/hour steam co-generation
ration in the analysis of the electricity system, grid planning
plant in the area of Salina Cruz, in Mexico’s Oaxaca State.
and the design, operation and maintenance of transmission
The co-generation plant to be built by Enel, Abengoa and
assets, as well as evaluating the acquisition or development
PMX Cogeneración (an affiliate company indirectly owned
of transmission assets as part of integrated initiatives.
by Pemex) will provide the Pemex refinery with part of the
Under the MoU, in the event that one of the parties identi-
electricity and steam produced by the new plant, while the
fies an opportunity that it deems could be of mutual interest,
remaining electricity generated will be sold on the market.
or even of exclusive interest to the other party, it may offer
that party information on the opportunity as a priority. These
opportunities will be assessed by the two companies on the
basis of their common interests. The agreement will last for
13
May
Francesco Starace appointed to
United Nations Global Compact
three year.
12
May
Agreement with Tesla on the
development of batteries in
solar and wind plants
On May 13, 2015, the United Nations announced that its Secre-
tary-General Ban Ki-moon appointed Francesco Starace, Chief
Executive Officer of the Enel Group, to the Board of Directors
of the United Nations Global Compact. The Global Compact is
the world’s largest corporate sustainability initiative, and the
On May 12, 2015, Enel Green Power and Tesla finalized an
Board is a cornerstone of its governance framework, helping
agreement for the testing of the integration of Tesla’s statio-
to shape strategy and policy and providing advice on all Global
nary energy storage systems with Enel Green Power’s so-
Compact-related matters, particularly on those regarding su-
lar and wind plants. The deal seeks to increase output from
stainability. Among the main activities of the Global Compact is
Enel Green Power facilities and supply advanced services
its LEAD initiative. Enel is one of the six global companies run-
for better overall integration of renewables into the grid. The
ning the LEAD Board Programme, which aims to reinforce the
companies will begin their collaboration with the selection
role of boards of directors in integrating sustainability issues
of an initial pilot site, where a Tesla battery system, which
into their corporate strategies.
has a power output capacity of 1.5 MW and energy storage
Francesco Starace is the first representative of an Italian busi-
capacity of 3 MWh, will be installed. The agreement is part
ness to be appointed to the Board. His appointment is effective
of a broader memorandum of understanding between the
from June 1, 2015 for a term of three years.
two companies that provides for both the integration of Tesla
energy systems into Enel’s business and the development
of electric mobility. The agreement falls within Enel Green
Power’s broader program for the testing of stationary stora-
ge systems.
3
June
Enel confirmed in the Euronext
Vigeo sustainability index
On June 3, 2015, Enel was confirmed in the Euronext Vigeo
- World 120 index, listing the 120 most sustainable compa-
nies with the largest free-float market capitalization in Euro-
pe, North America and the Asia Pacific region. Enel was also
82
Annual Report 2015 confirmed in the regional Euronext Vigeo Eurozone 120 and
SE4Good is an equity index series designed to foster in-
Europe 120 indexes, which respectively list the 120 most
vestment in companies based on their ESG performance.
sustainable companies with the largest free-float in the Eu-
Companies included in the FTSE4Good Index Series meet
rozone and the European region. Enel has been included in
a variety of environmental, social and governance criteria.
these indexes for three straight years, ever since their in-
ception. Euronext Vigeo updates its inclusion criteria every
six months, ensuring that the sustainability credentials of
companies listed in its indices are constantly tested against
the latest trends and developments.
Endesa and Enel Green Power have been included in the
27
July
Reorganization of operations
in Latin America
Euronext Vigeo - World 120 index since the end of 2014. In
On July 27, 2015, the boards of directors of Enersis SA (“Ener-
turn, these companies have also been included in the Euro-
sis”) and its subsidiaries Empresa Nacional de Electricidad SA
next Vigeo Europe 120 and Eurozone 120 indexes since their
(“Endesa Chile”) and Chilectra SA (“Chilectra”), following an
inception three years ago.
analysis of the corporate reorganization project to separate the
Enel inclusion in these indexes serves as recognition of its
electricity generation and distribution operations carried out in
firm commitment to sustainability. The Euronext Vigeo in-
Chile from those conducted in other Latin American countri-
dexes acknowledge the efforts of leading companies that
es, agreed that the reorganization shall be achieved through
place sustainable development at the core of their busi-
the following corporate transactions: (i) the partial spin-off of
ness agenda. Vigeo draws up the indexes’ composition by
Endesa Chile and Chilectra by allocating all of the assets and
analyzing nearly 330 indicators for each company based on
liabilities they hold in other Latin American countries (i.e. other
38 criteria, including respect for the environment; protection
than Chile) to two newly-established companies, named, re-
of human rights and recognition of companies’ human capi-
spectively, “Endesa Américas” and “Chilectra Américas”; (ii)
tal; relations with stakeholders; corporate governance and
the partial spin-off of Enersis by allocating all of the assets and
business ethics; integrity in influencing policy and efforts
liabilities it holds in Chile (including its stakes in Endesa Chile
to fight corruption; and the prevention of social and envi-
and Chilectra) to a newly-established company named “Ener-
ronmental dumping in the supply and subcontracting chain.
sis Chile”, with a concomitant change of the Enersis company
In addition to these three rankings, the Enel Group also parti-
name into “Enersis Américas”, which will continue to own all of
cipates in the world’s leading sustainability indices, including
the assets and liabilities held in other Latin American countries
the Dow Jones Sustainability Index World, the Dow Jones
(including the stakes in the newly-established companies En-
Sustainability Index Europe, FTSE4Good, the Carbon Disclo-
desa Américas and Chilectra Américas); and (iii) the merger of
sure Leadership Index, the Carbon Performance Leadership
Endesa Américas and Chilectra Américas into Enersis Améri-
Index and Newsweek Green Ranking.
cas. This surviving company will therefore own all of the stakes
13
July
Enel again in the FTSE4Good
index
held by the Enersis Group in other Latin American countries
(i.e. other than Chile). Enersis Chile and Enersis Américas are
expected to be based in Chile and their shares listed on the
same markets on which the Enersis Group companies’ shares
are currently listed. None of these transactions will require the
existing shareholders to commit additional financial resources.
On July 13, 2015, the Enel Group was once again confirmed
On November 6, 2015, the boards of directors of its Chilean
in the prestigious FTSE4Good index, having been awarded
subsidiaries Enersis, Endesa Chile and Chilectra agreed that
an overall score of 4.3 out of 5 in its ESG (Environmental
the corporate restructuring aimed at separating electricity ge-
- Social - Governance) performance. The FTSE4Good index
neration and distribution operations in Chile from those in other
measures the performance of companies in areas such as
Latin American countries was in the interest of their respective
the fight against climate change, governance, respect for
companies.
human rights and combatting corruption. Enel Green Power,
Those boards also met again to discuss the convening of their
the renewables company of the Enel Group, was also confir-
respective extraordinary shareholders’ meetings to approve
med as a participant in the index.
the overall corporate reorganization and launch the first phase
Created by the global index company FTSERussell, FT-
of the transaction involving the partial demergers of Enersis,
83
Report on operationsAnnual Report 2015 Endesa Chile and Chilectra. In view of the final phase of the
corporate reorganization, which provides for the merger of En-
desa Américas and Chilectra Américas into Enersis Américas,
the boards of directors of Enersis, Endesa Chile and Chilectra
13
October
also agreed, acting on the basis of the opinions of financial advi-
Enel starts production
at El Quimbo
sors and independent experts on the valuations of the compa-
On October 13, 2015, Emgesa started production at the El
nies that will be involved in that merger, an indicative exchange
Quimbo hydropower plant in Colombia. With an installed ca-
ratio falling within a range of between:
pacity of 400 MW, the facility is located in the region of Huila,
> a minimum of 2.3 and a maximum of 2.8 shares of Ener-
about 350 kilometers southwest of Bogota, and is fed by the
sis Américas for each share of Endesa Américas;
Magdalena, the country’s largest river. The filling of the reser-
> a minimum of 4.1 and a maximum of 5.4 shares of Ener-
voir began in late June after the completion of the principal
sis Américas for each share of Chilectra Américas.
civil works, which then led to the entry into service of the first
The documentation used by the boards of Enersis, Endesa
of the plant’s two units. Ahead of the start of commercial ope-
Chile and Chilectra as the basis of their approval of the reorga-
rations, trials were carried out at the plant for around 20 days.
nization is available to the public on the websites of the com-
With the commissioning of the second unit the facility will
panies involved.
be able to produce about 2.2 TWh per year, enough to meet
On December 18, 2015, the extraordinary shareholders’ me-
around 4% of the country’s electricity demand and reducing
etings of the Chilean subsidiaries Enersis, Endesa Chile and
the impact of El Niño, which has caused drought conditions,
Chilectra approved the first phase of the above corporate re-
on the supply of electricity in the country.
organization.
The split was then carried out with effect from February 1, 2016.
26
October
Enel confirmed in STOXX
Global ESG Leaders Index
Enel again in the Dow Jones
Sustainability Index World
On October 26, 2015, the Enel Group was admitted to the
STOXX Global ESG Leaders Index for the second year in a
On September 10, 2015, the Enel Group, for the twelfth con-
row. The index measures the performance of companies’
secutive year, was included in the Dow Jones Sustainability
environmental, social and governance (ESG) practices based
Index World (DJSI World). The index comprises just 317 com-
on an assessment carried out by Sustainalytics, a leading
panies around the world, fewer than 10% of those selected
sustainability rating agency.
by RobecoSAM for assessment for admission to the DJSI.
Enel is one of 10 Italian companies in the DJSI World.
2
November
Sale of the Porto
Marghera site
10
September
24
September
Acquisition of BLP Energy
On November 2, 2015, the sale of Enel’s Porto Marghera
site was completed. The coal-fired Giuseppe Volpi thermal
On September 24, 2015, Enel Green Power acquired a majority
power station, which has been largely inactive for the past
stake in BLP Energy (“BLP”), the utility-scale wind and solar
three years, has been sold together with the surrounding
subsidiary of Bharat Light & Power, for a total of about €30
area to three companies already operating in the port logi-
million. BLP, one of the most important renewables companies
stics, structural metalworking and plant engineering industri-
in India, current owns and operates wind plants in the states of
es: Porto Invest, Simic and CITI. This is the first plant that
Gujarat and Maharashtra with a total installed capacity of 172
Enel has disposed of within the Futur-E project, which envi-
MW and total annual output of about 340 GWh. The company
sages the redevelopment of 23 thermoelectric plants, many
also has a pipeline of about 600 MW of wind projects at various
of which are no longer operational. Two of the three buyers
stages of development.
(CITI and Simic) will develop new industrial facilities on the
84
Annual Report 2015
site, while the third (Porto Invest) will expand the logistics
1,280 MW. The closing of the sale is conditional on Dolo-
operations that it already carries out nearby, operating di-
miti Energia SpA (which holds the remaining 51% of HDE)
rectly and through associated companies. The investments
waiving or not exercising its right of pre-emption and on
associated with these initiatives will have a major positive
the buyer receiving clearance from the EU antitrust autho-
impact on economic activity and employment in the Porto
rity. The transaction will enable the Enel Group to reduce
Marghera area, both in the construction phase and in the
its consolidated net financial debt by an amount equal to,
operation of the new industrial activities.
approximately, the total consideration noted above.
3
November
Agreement for sustainable
wind power renewal
17
November
Integration of Enel and Enel
Green Power
On November 3, 2015, E2i, Enel Green Power, ERG Renew,
On November 17, 2015, the Boards of Directors of Enel
Falck Renewables and IVPC, together with Legambiente and
SpA (“Enel”) and Enel Green Power SpA (“EGP”) appro-
ANCI, signed the Charter for Sustainable Wind Power Rene-
ved a project for the non-proportional spin-off (the “Spin-Off
wal. The goal of the document is to specify operational rules,
Project”) of part of EGP into Enel (the “Spin-Off”). The Spin-
application criteria, standards, procedures and best practices
Off envisages: the assignment by EGP to Enel of the spun-
that will ensure the effectiveness and transparency of projects
off assets, essentially represented by (i) the 100% stake
for the renewal of Italy’s existing wind power park in order
held by EGP in Enel Green Power International BV, a Dutch
to create a sustainability roadmap. Through the upgrading of
holding company that holds investments in companies ope-
the plants and the use of modern technology, it is possible
rating in the renewable energy sector in North, Central and
today to reduce the number of wind turbines and generate
South America, Europe, South Africa and India; and (ii) the
more “green” electricity without reducing installed capacity,
assets, liabilities, contracts and other legal relationships as-
while offering the electricity network more technical flexibility.
sociated with those investments (the “Spun-Off Assets”);
The Charter is founded on four key principles: the protection
and the retention by EGP of all remaining assets and liabi-
and making the most of natural resources in existing sites;
lities other than those that are part of the Spun-Off Assets
the optimal use of each territory’s resources, maximizing the
(and thus, essentially, all Italian operations and a small num-
use of existing infrastructure; the containment and mitigation
ber of remaining foreign investments). Since the transac-
of environmental impacts at each stage of the process; and
tion involves a non-proportional spin-off, it is expected that
continuity and transparency in the relationship with the area,
(i) shareholders of EGP other than Enel may exchange all
institutions and local communities.
the shares they hold in EGP with Enel shares and (ii) Enel
13
November
Agreement for the disposal
of Hydro Dolomiti Enel
will exchange the shares corresponding to its stake in the
Spun-Off Assets with Enel shares, which will be immedia-
tely cancelled in accordance with Article 2504-ter, paragraph
2, and Article 2506-ter, paragraph 5, of the Italian Civil Code.
The Spin-Off will be carried out on the basis of an exchange
ratio of 0.486 newly issued Enel shares for each EGP share
On November 13, 2015, Enel Produzione SpA and Fedaia
tendered for exchange (the “Exchange Ratio”), with no cash
Holdings Sàrl, a Luxemburg-based subsidiary of Macqua-
adjustment. As a result, as of the effective date of the Spin-
rie European Infrastructure Fund 4 (“MEIF4”), managed by
Off, EGP will reduce its share capital by an amount equal to
Macquarie Infrastructure and Real Assets, had signed an
the value of the Spun-Off Assets while Enel will increase
agreement for the sale of the entire stake held by Enel Pro-
its share capital to cover the consideration for the Spun-Off
duzione in Hydro Dolomiti Enel Srl (“HDE”), equal to 49%
Assets. Specifically, Enel will issue up to 770,588,712 new
of the share capital, for about €335 million. The sale price is
shares – with full rights and a par value of 1 euro each – to be
subject to customary completion adjustments.
issued to minority shareholders of EGP in accordance with
HDE operates 28 hydropower plants, mainly located in the
the Exchange Ratio. As of the effective date of the Spin-Off,
Province of Trento, with a total installed capacity of about
Enel will be the sole shareholder of EGP, and EGP shares
85
Report on operationsAnnual Report 2015 will cease to be traded on the Mercato Telematico Azionario,
Energetický a prumyslový holding as (“EPH”), for the sale of
the stock exchange organized and operated by Borsa Italiana
the stake held by Enel Produzione in Slovenské elektrárne,
SpA (“MTA”), and on the Spanish continuous electronic tra-
equal to 66% of the latter’s share capital.
ding system (Sistema de Interconexión Bursátil, SIBE).
The sale will be executed by way of a transfer of Enel Pro-
On December 23, 2015, the information document associa-
duzione’s entire stake in Slovenské elektrárne to a newly
ted with the transaction was published.
established company (“HoldCo”), and the subsequent sale
26
November
Disposal of renewables
assets in Portugal
to EP Slovakia of 100% of the share capital of the HoldCo.
This sale of HoldCo to EP Slovakia is due to be implemented
in two phases.
In the first phase, Enel Produzione will sell 50% of HoldCo’s
share capital to EP Slovakia for €375 million, of which €150
million will be paid upon the closing of the first phase, and
On November 26, 2015, Enel Green Power España (“EGPE”,
€225 million will be paid upon the closing of the second pha-
60% owned by Enel Green Power and 40% owned by En-
se. The consideration could vary subject to the application of
desa), has closed the sale of the entire share capital of
the adjustment mechanism, as described below.
Finerge Gestão de Projectos Energéticos SA (“Finerge
In the second phase, a put or a call option can be exercised
Gestão”), a wholly-owned EGPE subsidiary operating wind
respectively by Enel Produzione or by EP Slovakia, exercisa-
farms in Portugal with a net installed capacity of 642 MW,
ble 12 months after receiving the Trial Operation Permit of
equivalent to a gross capacity of 863 MW, to the Portu-
units 3 and 4 of the Mochovce nuclear power plant, which
guese company First State Wind Energy Investments SA
are currently under construction. On the basis of the cur-
(“First State Wind Energy Investments”). The original agre-
rent work plan these options are expected to become exer-
ement was announced on September 30, 2015. The total
cisable within the first half of 2019. Upon exercise of either
consideration for the sale is €900 million, including the
option, Enel Produzione would transfer the remaining 50%
repayment of a shareholder loan to Finerge Gestão. With
of the HoldCo’s share capital to EP Slovakia for €375 mil-
this sale, Enel Green Power has exited the Portuguese re-
lion. Payment will be due at the time of the closing of the
newables market.
sale and the consideration is subject to the application of
The sale was finalized following the completion of the split
the adjustment mechanism described below. The closing of
(announced on October 28, 2015) of ENEOP - Eólicas de
the second phase is subject to obtaining the Final Operation
Portugal SA (“ENEOP”), a company that previously owned
Permit for Mochovce’s units 3 and 4.
a portfolio of operating wind farms with a total installed
The total consideration payable over the two phases, equal
capacity of 1,333 MW, in which Finerge Gestão held a sta-
to €750 million, is subject to an adjustment mechanism. Any
ke of 35.96%. As a result of the split, Finerge Gestão fully
adjustment will be calculated by independent experts and
consolidated six wind farms for a total installed capacity
applied upon completion of the second phase on the basis
of 445 MW. The above capacity was added to Finerge Ge-
of a set of parameters, including the evolution of the net
stão’s previous portfolio of majority and minority-owned as-
financial position of Slovenské elektrárne, developments in
sets, equal to a net consolidated capacity of approximately
energy prices in the Slovak market, operating efficiency le-
197 MW (or 418 MW gross).
vels at Slovenské elektrárne as measured against benchmar-
The total consideration of €900 million paid in full in cash is
ks specified in the agreement, and the enterprise value of
subject to price adjustments in line with standard practice
units 3 and 4 of Mochovce.
for this type of transaction.
The agreement also provides that, should the options not
18
December
Agreement to dispose of
Slovenské elektrárne
become exercisable under the above timetable, these op-
tions could be in any case exercisable starting from June
30, 2022 (the “long stop date”). In that case, the adjustment
of the consideration will also take into account the effective
enterprise value of the above units.
The closing of the transaction is also subject to clearance
On December 18, 2015, Enel Produzione SpA signed a con-
from the European Union’s antitrust authorities.
tract with EP Slovakia BV (“EP Slovakia”), a subsidiary of
86
Annual Report 2015 22
December
Creation of photovoltaic
joint venture in Italy
On December 22, 2015, Enel Green Power and F2i SGR SpA
(“F2i”), acting on behalf of F2i - Fondo italiano per le infrastrut-
ture, together with their subsidiaries Enel Green Power Solar
Energy Srl and F2i Energie Rinnovabili Srl, closed an agree-
ment to create an equally held joint venture, following up on
the agreement signed and announced on October 16, 2015.
The joint venture, to which Enel Green Power transferred its
Italian solar assets, emerged from the merger of F2i Solare 1
and F2i Solare 3, companies controlled by F2i Energie Rinno-
vabili, with effect as from December 31st, 2015.
The new joint venture, which seeks to become the PV market
leader in Italy, thus begins life with a portfolio of 207 MW of
installed capacity, the effect of the contribution of 102 MW by
Enel Green Power and 105 MW by F2i.
The closing of the transaction was completed following sati-
sfaction of the conditions provided for in the agreement sig-
ned by the parties on October 16, 2015, including approval by
the competent EU antitrust authorities. The enterprise value of
the Enel Green Power assets amounted to about €234 million
and that of the F2i assets to about €282 million, with respec-
tive equity values of about €91 million, net of minorities, and
about €111 million. Accordingly, Enel Green Power, in order to
ensure equal participation in the joint venture, made a cash
contribution of about €20 million. An adjustment of these va-
lues, using a mechanism customary for this type of transac-
tion, is envisaged for 2016.
87
Report on operationsAnnual Report 2015 Reference scenario
Enel and the financial markets
Gross operating margin per share (euro)
Operating income per share (euro)
Group net earnings per share (euro)
Group net ordinary earnings per share (euro)
Dividend per share (euro)
Group shareholders’ equity per share (euro)
Share price - 12-month high (euro)
Share price - 12-month low (euro)
Average share price in December (euro)
Market capitalization (millions of euro) (1)
No. of shares outstanding at December 31 (millions)
(1) Calculated on average share price in December.
Enel stock weighting in:
- FTSE MIB index
- Bloomberg World Electric index
Rating
2015
1.63
0.82
0.23
0.32
0.16
3.44
4.46
3.44
3.96
37,220
9,403
2014
1.68
0.33
0.05
0.33
0.14
3.35
4.46
3.13
3.75
35,307
9,403
Current (1)
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2013
9.98%
3.00%
9.05%
3.04%
9.45%
2.89%
Stable
BBB
A-2
8.82%
3.12%
Stable
BBB
A-2
Negative
Negative
Baa2
P2
Baa2
P2
Stable
Watch Negative
BBB+
F2
BBB+
F2
Standard & Poor’s
Outlook
Positive
Positive
Medium/long-term
Short-term
Outlook
Medium/long-term
Short-term
Outlook
Medium/long-term
Short-term
BBB
A-2
Stable
Baa2
P2
Stable
BBB+
F2
BBB
A-2
Stable
Baa2
P2
Stable
BBB+
F2
Moody’s
Fitch
(1) Figures updated to January 31, 2016.
The year 2015 was characterized by an improvement in the
new and significant strains in the financial market in China
economic conditions of the advanced countries. Last De-
that emerged in the latter part of 2015, accompanied by in-
cember, the US Federal Reserve ended its policy of interest
creasing worries about the country’s growth potential. These
rates around zero that it first adopted in 2008: the decision
developments triggered a decline in the prices of raw mate-
was prompted by the substantial improvement in the labor
rials, with oil prices falling below $30 a barrel.
market in the world’s leading economy.
Growth continued in the euro area, although the economic
By contrast, the weakening of economic activity in the
recovery remains fragile. The weakening of foreign demand
emerging economies continued. Of special concern are the
and the sharp fall in oil prices have revived the downside
88
Annual Report 2015
risks to inflation, posing a consequent threat to growth.
€3.892, up 5.3% on the previous year. The Enel stock was
In Italy, the recovery continued gradually, thanks in part to
one of the best performers among its European peers, re-
the improvement in domestic demand and the decline in the
gistering a significant level of performance by comparison
unemployment rate over the course of 2015.
with the other utilities in the euro area.
Nevertheless, the start of the year saw an increase in uncer-
On June 24, 2015 Enel paid the dividend on 2014 profits of
tainty for the international economic outlook. In the emerging
€0.14 a share, up 8% on the dividend distributed the pre-
countries, and China in particular, growth is continuing to de-
vious year.
celerate. The weakness of demand is helping to keep oil prices
and raw materials prices in general at historically low levels.
At December 31, 2015, the Ministry for the Economy and Fi-
In the mature economies, these developments are further
nance held 25.5% of Enel, while institutional investors held
increasing the risk of a level of inflation that is not consistent
51.5% and individual investors held the remaining 23.0%.
with price stability.
In this environment, the financial markets have also been im-
For further information we invite you to visit our corporate
pacted by the tensions in China and the emerging markets,
website (www.enel.com) and in particular the Investor Rela-
posting significant losses in the first two months of the year.
tions section (http://www.enel.com/en-GB/investor/), which
The main European equity indices closed 2015 with contra-
share price, information on corporate bodies and the regula-
sting results.
tions of shareholders’ meetings, as well as periodic updates
The FTSE Italy All Share posted a gain of 15%, the best per-
on corporate governance issues.
contains financial data, presentations, on-line updates of the
former among the European stock markets.
The euro-area utilities segment closed the year with a fall
(which can be reached by phone at +39-0683054000 or by e-
We have also created contact centers for private investors
of 5%.
mail at azionisti.retail@enel.com) and for institutional investors
(phone: +39-0683051; e-mail: investor.relations@enel.com).
As regards Enel shares, 2015 ended with the stock price at
89
Report on operationsAnnual Report 2015 Performance of Enel share price and the Bloomberg World Electric, Euro STOXX Utilities and
FTSE Italia All Share indices from January 1, 2015 to February 5, 2016
EURO
4.80
4.60
4.40
4.20
4.00
3.80
3.60
3.40
3.20
3.00
Jan
15
Feb
15
Mar
15
Apr
15
May
15
Jun
15
Jul
15
Aug
15
Sep
15
Oct
15
Nov
15
Dec
15
Jan
16
Feb
16
Enel
Bloomberg World Electric
Euro STOXX 600 Utilities
FTSE Italia All Share
Source: Bloomberg
90
Annual Report 2015 Economic and energy conditions in 2015
Economic developments
The global economic environment in 2015 was marked by
rable goods and the real estate sector performed more er-
considerable fragility, characterized by a sharp increase in
ratically. In particular, industry showed weakness, with the
volatility in the major financial markets and uncertainty about
ISM manufacturing index falling for the past six months in
the outlook for global economic recovery. World GDP growth
a row, which together with the fall in the stock market, the
stood at 2.5%, below the average of the last 15 years and
flattening of the yield curve (10Yr - 2Yr notes) and the perfor-
supported mainly by the improvement in economic activity
mance of swap rates at 5 years (5Yr - 5Yr swap rates) have
in the advanced countries (which saw GDP rise 1.9%). Con-
begun to create fears of a possible recession risk. Inflation
ditions in the emerging economies are also a concern, mar-
remains well below the 2% target level set by the Federal
ked in most cases by a significant deterioration in the twin
Reserve, mainly due to low commodity prices (the Core CPI
deficits (as in South America and South Africa), a contraction
ex food & energy rose by 2.1% over the previous year). In
of domestic demand, high inflation and sharp depreciations
December last year, the Fed reversed its expansionary mo-
in local currencies. More specifically, the strains in the Chi-
netary policy with an initial tightening of interest rates. Ho-
nese financial market, combined with the prospects of a
wever, uncertainty about the impact of the global economic
slowdown in the real economy (underscored by the collapse
environment (China in particular), a prolonged depression of
in investment in real estate, sales of durable goods and in-
the prices of oil commodities resulting in expectations of
dustrial activities) and the continued expansionary monetary
low inflation and economic growth (flattening of the forward
policy with the depreciation of the currency (the CNH), as
yield curve) and increased volatility in financial markets have
well as the collapse in imports together with a rapid outflow
raised probability of the Fed calling a new pause in its mone-
of foreign capital from the country have exacerbated the ex-
tary tightening during the year.
pansion of trade by depressing the economies of its major
The combined effects of the expansionary monetary stance
partners and the countries directly and indirectly exposed
of the European Central Bank (the extension of quantitative
to China risk on capital and foreign exchange markets (Chi-
easing, cutting rates on the deposit facility to -0.15%) toge-
le, South Korea, Australia, Taiwan, the Philippines, South
ther with the fall in commodity prices and the euro (with the
Africa, Indonesia, Russia, Brazil, Mexico and Canada). The
latter two factors playing the main role) allowed the euro area
downward revision of the outlook for the Chinese economy
to achieve expected growth of 1.5% year-on-year, about 60
has raised pressures to sell in mineral commodities markets
basis points more than the previous year. Inflation remains
(copper, zinc, aluminum, lead, nickel and coal) in response
the real Achilles heel for the Central Bank, with a rate of clo-
to a decline in use of those materials in industry and in con-
se to zero in 2015 and very limited prospects for an upturn in
struction. Oil prices in particular stood below the lows rea-
the next two years (not reaching the ECB’s 2% target befo-
ched at the height of the 2008-2009 crisis as a result of fears
re 2018). Employment is improving, but the unemployment
of an expansion of oversupply due to lower global demand.
rate remains very high (11.4%), still distant from pre-crisis
Another threat is the imminent removal of sanctions on Iran.
levels (around 8%). The outlook for economic growth in
The reasons for these developments are rooted in the stra-
the euro area, while improving, remains hampered by the
tegy of the OPEC countries to maintain current production
weakness of the global environment, by developments in
quotas. The economic impact has been devastating for the
foreign exchange markets (in the short term, a strengthe-
main commodity exporters, such as Russia, South Africa,
ning euro could limit growth), by investor sentiment (growth
Chile, Colombia, Peru, Australia and Indonesia.
has mainly been driven by private consumption while in-
The United States ended 2015 with solid GDP growth
vestment remains weak) and by the readiness of the ECB
(+2.5%), consolidating the recovery in the wake of the glo-
(via the extension and strengthening of its expansionary
bal financial crisis. The recovery was mainly driven by dome-
measures) to calm jitters in the financial markets and foster
stic demand due to the strengthening of the labor market
greater price stability.
(with an improvement in the climate of consumer confiden-
The effects of the weak euro, low inflation and an impro-
ce, wages, and a decline in unemployment to 4.9%), while
vement in the labor market (the Jobs Act) enabled Italy to
the manufacturing sector, fixed investment, orders for du-
achieve GDP growth, estimated by the IMF at 0.8% com-
91
Report on operationsAnnual Report 2015 pared with -0.4% in 2014. The rise is primarily due to an im-
lopments in the price of Brent crude will keep downwards
provement in consumer confidence (with the improvement
pressure on the ruble, but will also allow gradual decline in
in the credit market, employment, tax incentives and low
inflation (forecast at around 7% over the next 12 months).
inflation). However a number of threats to the outlook for
With Brent prices around $30 a barrel, the probability of a
the future remain: a reduction in fiscal stimulus measures
cut in rates by the central bank (CRB) remains rather low.
in order to curb the budget deficit, low investor confidence,
The economic situation in Brazil is even more worrying, with
weak and possibly declining exports due to the economic
an estimated contraction of 3.7% in GDP in 2015, inflation
slowdown in China, Russia and Brazil, the strengthening
currently at 10.7% and a budget deficit of 9.3% of GDP.
euro, political instability in the implementation of structu-
Political instability, lack of coordination between Congress
ral reforms (the Senate, the public sector, a still too rigid
and the government in implementing reforms (cutting pu-
and unproductive labor market). The IMF has confirmed
blic spending, reforming the pension system and increasing
its growth forecasts for 2016 and 2017, respectively 1.3%
the tax burden) and implementing a sustainable restrictive
and 1.2%. However, the recent turbulence in the financial
fiscal policy make the outlook for economic recovery extre-
markets and “flight to safety” of investors (with a sharp in-
mely uncertain. More specifically, the central bank continues
crease spreads on government securities), the crisis of the
to maintain a tight monetary policy (with interest rates to
Italian and European banking system and elevated volatility
14.25%) to support the exchange rate and prevent a worse-
in the foreign exchange and commodities markets cast a
ning of the outflow of foreign capital, in addition to contai-
cloud over the country’s ability to achieve those objectives
ning inflation (with a target of 6.5% for 2016). However, the
in the next two years (upwards pressure on BTP yields and
weak global environment, fiscal instability and high interest
a growing deficit suggest that a restrictive fiscal policy is in
rates (with the cost of financing in the private sector at over
the offing, with negative impact on growth in the absence
30%) undermine the chances of recovery for the Brazilian
of effective negotiations between the leading EU countries).
economy. Within Latin America, Chile, Colombia and Peru
Japan faces a complex economic environment, struggling
are still underperforming. Chile should register estimated
with recession risk exacerbated by the fall in production and
growth of 2% in 2015, compared with an average of 4.6%
consumption, while inflation is expected to remain low at
over the last five years. The country was hit by the collapse
what the Bank of Japan (BOJ) now forecasts will be 0.8%
in copper prices (50% of total exports and about 11% of
in 2016. The new developments in commodity prices, the
GDP), the decline in imports by China (its main trading part-
economic slowdown in China and the instability of global
ner) and the recession in Brazil. Weak consumer and inve-
financial markets prompted the BOJ to adopt negative in-
stor confidence, high inflation (although declining somewhat
terest rates on deposits (-0.1%) in an attempt to encourage
as a result of developments in commodity prices), and the
banks to increase lending to businesses, restore investor
emergence of higher interest rates in the United States du-
confidence and stem further appreciation of the yen. The ef-
ring the year remain risk factors for 2016. Despite an unem-
fort is challenging, however, with yields on medium to long-
ployment rate at a record low, domestic demand is begin-
term government securities likely to turn negative, with a
ning to reflect the decline in real wages and hence private
concomitant risk of disinvestment (except for the BOJ) by
consumption (the main growth driver in 2015). Colombia’s
investors in Japanese debt.
GDP growth is expected to have decelerated from 4.6% in
The emerging economies continue to underperform (3.7%
2014 to 2.8% in 2015. The fall in oil prices (52% of exports),
compared with 4.4% in 2014). The drivers continue to be
only partially offset by the depreciation of the local currency,
primarily related to commodities, the economic slowdown
the deterioration in the fiscal balance (-4.1% in 2015 com-
in China, high debt levels and unsustainable interest rates,
pared with 2.3% in 2014) and the overall weak economic
excessive exchange rate volatility, with a resulting substan-
environment continue to adversely affect the country’s ca-
tial outflow of foreign capital.
pacity for recovery, despite the good elasticity of domestic
Among the emerging countries, Russia and Brazil are in re-
demand. Growth in Peru was essentially stable (2.5% com-
cession. The former is looking at an expected contraction of
pared with 2.4% in 2014), albeit well below the average of
3.7% in GDP due to the collapse in exports owing to low
the last five years (5.2%) due to a slowdown in investment
oil prices, a depreciation of 60% in the exchange rate (in
(public and private) and domestic demand, a slowdown in
line with the trend in prices of Brent crude), an inflation rate
mining activity due to lower commodity prices in 2015 (cop-
of more than 12% and a budget deficit at 3.7%. The deve-
per and gold) and a lack of exchange rate flexibility in of-
92
Annual Report 2015 fsetting the decline in commodity prices (the central bank is
(due to a more stable outlook for copper and gold prices) and
focused on maintaining the stability of the currency with a
the fishing industry, and the normalization of the investment
restrictive monetary policy stance, exacerbating the outflow
cycle (with the main benefits going to the construction indu-
of foreign reserves). Inflation remains well above the confi-
stry) presage a gradual improvement in the economic outlo-
dence range (3% +/- 1%), and currently stands at 4.6% year-
ok for 2016 and a strengthening of monetary restriction by
on-year. The recovery in the real economy in the final months
the central bank (in order to hold inflation at its target level).
of the year (GDP +4% year-on-year in November, compared
The following table shows the growth rates of GDP in the
with +3% in October), supported by an increase in mining
main countries in which Enel operates.
Annual real GDP growth
%
Italy
Spain
Portugal
Greece
France
Romania
Russia
Brazil
Chile
Colombia
Mexico
Peru
Canada
United States
2015
0.8
3.2
1.5
-0.2
1.1
3.5
-3.7
-3.8
2.0
2.8
2.5
2.5
1.2
2.5
Source: National statistical institutes and Enel based on data from ISTAT, INE, EUROSTAT, IMF, OECD and Global Insight.
2014
-0.4
1.4
0.9
0.7
0.2
2.8
0.6
0.1
1.8
4.6
2.3
2.4
2.5
2.4
93
Report on operationsAnnual Report 2015 Developments in the main market indicators
Money market
1.40
1.35
1.30
1.25
1.20
1.15
1.10
1.05
1.00
0.40
0.30
0.20
0.10
0.00
-0.10
-0.20
Jan
14
Feb
14
Mar
14
May
14
Jun
14
Jul
14
Sep
14
Oct
14
Dec
14
Jan
15
Feb
15
Apr
15
May
15
Jul
15
Aug
15
Sep
15
Nov
15
Dec
15
Euro - US dollar
3-month Euribor
International commodity prices
The price of Brent collapsed in 2015, falling to $35.8 a barrel
OPEC countries, with the revival of Iraqi output in the final
at the end of the year (compared with $55.6 in 2014). The
months of the year (an increase of 250 thousand barrels a day
decline was exacerbated by the widening divergence betwe-
last November); and (iii) the lifting of sanctions of Iranian oil
en supply and demand, considerable strains and volatility in
exports (January 16, 2016), with a potential increase of more
financial markets and the strengthening of the dollar over the
than 500 thousand barrels a day.
course of the year.
This has been accompanied by the continuing reluctance of
Demand-side factors in the collapse included: (i) the
the OPEC countries, with Saudi Arabia in the lead, to reduce
slowdown in global economic growth, especially in China
production in order to protect market shares (and potentially
and the emerging economies; (ii) concern for environmen-
further discourage production from unconventional oil). The-
tal constraints (COP 21) and the consequent decline in con-
se fundamentals were flanked by financial considerations,
sumption; and (iii) the appreciation of the dollar and high vo-
such as expectations of an increase in interest rates by the
latility in financial markets, with an increase in pressure to
Federal Reserve, the appreciation of the dollar, and an incre-
sell. The supply side was characterized by: (i) an increase
ase in investor risk aversion (as from the second half of the
in unconventional output (tight oil) in the United States and
year) with consequent sell-off of risky assets, including com-
Canada in the early part of the year (although it declined in
modities.
the closing months of 2015); (ii) an increase in production by
94
Annual Report 2015 Commodity prices
800
700
600
500
400
300
200
100
0
Jan
13
Mar
13
May
13
Jul
13
Sep
13
Nov
13
Jan
14
Mar
14
May
14
Jul
14
Sep
14
Nov
14
Jan
15
Mar
15
May
15
Jul
15
Sep
15
Nov
15
Dec
15
Zeebrugge gas (€/toe)
API2 coal (€/toe)
Brent (€/toe)
The collapse in the price of Brent together with the slowdown
ever increasing competition from renewables, giving rise to
in industrial activity, warmer temperatures, oversupply and
a surplus of supply on the market.
closer attention to environmental constraints all contributed
The contraction in gas prices was more modest, with the
to the decline in coal and gas prices. Coal prices fell by 67%
spot price of natural gas at the Zeebrugge hub in Europe
in 2015 to $47.9/metric ton at the end of the year, compa-
falling by 15% over the course of the year, going from 48.4
red with $71.3/metric ton at the end of 2014. The growth
pence/therm (end-2014) to 32.2 pence/therm (end-2015).
in energy demand is slowing and in many mature markets
Despite the decline in global demand due to the economic
has turned negative as a result of the combined impact of
slowdown, climate effects and the penetration of renewa-
the deterioration in economic conditions, new energy effi-
bles, the greater competitiveness of gas than coal in electri-
ciency measures, stringent environmental policies and the
city generation stemmed any sharper decline in prices.
95
Report on operationsAnnual Report 2015 Electricity and natural gas markets
Developments in electricity demand
GWh
Italy
Spain
Romania
Russia (1)
Slovakia
Argentina
Brazil (2)
Chile (2) (3)
Colombia
2015
315,234
248,025
51,205
767,328
29,213
136,099
548,522
53,023
66,175
2014
310,535
243,544
50,641
772,255
28,086
130,654
569,734
52,225
63,570
Change
1.5%
1.8%
1.1%
-0.6%
4.0%
4.2%
-3.7%
1.5%
4.1%
(1) Europe/Urals.
(2) Figure for the SIC - Sistema Interconectado Central.
(3) Gross of grid losses.
Source: Enel based on TSO figures.
In Europe, the Mediterranean countries experienced growth
posted growth of 1.8% (+1.5% net of calendar and tempera-
in electricity demand, above all owing to economic recovery,
ture effects), considerably lower than estimated GDP growth
partly offset by climate effects. More specifically, Italy posted
of 3%. More specifically, slowdown in private and industrial
growth of 1.5% (1.4% net of climate and calendar effects),
consumption began in 2008, partly owing to efficiency gains
reversing the negative trend of the past three years. Driving
and partly to structural factors. In Russia, demand contracted
the growth were the South macro-area (which includes Cam-
in 2015 (-0.6%) compared with 2014, a small decline com-
pania, Puglia, Calabria and Basilicata), which registered the
pared with the recession under way in the country. Demand
largest gain at +4.4%, the Tuscany and Emilia Romagna area
continued to rise in Latin America, with significant increases
with +4.3% and the Center area (which includes Lazio, Abruz-
in Argentina (+4.2%), Colombia (+4.1%) and Chile (+1.5%).
zo, Marche, Molise and Umbria) with +2.3% on 2014. Spain
Demand contracted in Brazil (-3.7%), reflecting the recession.
Italy
Domestic electricity generation and demand
Millions of kWh
Net electricity generation:
- thermal
- hydroelectric
- wind
- geothermal
- photovoltaic
Total net electricity generation
Net electricity imports
Electricity delivered to the network
Consumption for pumping
Electricity demand
2015
2014
Change
180,871
44,751
14,589
5,816
24,676
270,703
46,381
317,084
(1,850)
315,234
167,080
59,575
15,089
5,567
21,837
269,148
43,716
312,864
(2,329)
310,535
13,791
(14,824)
(500)
249
2,839
1,555
2,665
4,220
479
4,699
8.3%
-24.9%
-3.3%
4.5%
13.0%
0.6%
6.1%
1.3%
20.6%
1.5%
Source: Terna - Rete Elettrica Nazionale (monthly report - December 2015).
96
Annual Report 2015
In 2015, domestic electricity demand increased by 1.5% (to
In 2015, net electricity generation increased by 0.6% or 1,555
315,234 million kWh) compared with 2014. Of total electricity
million kWh, to 270,703 million kWh. More specifically, in an
demand, 85.3% was met by net domestic electricity gene-
environment of increased electricity demand, the decrease
ration for consumption (85.9% in 2014) with the remaining
in hydroelectric generation in the amount of 14,824 million
14.7% being met by net electricity imports (14.1% in 2014).
kWh, mainly attributable to less favorable water availability
In 2015, net electricity imports increased by 2,665 million
of 13,791 million kWh as well as an increase in generation
kWh mainly as a result of lower average sales prices on in-
from other renewables (photovoltaic, +2,839 million kWh and
ternational markets, which were made even more attractive
geothermal, +249 million kWh) as a result of the expansion in
by the national production mix, penalized by the decline in
installed capacity in the country.
conditions, was offset by an increase in thermal generation
hydroelectric output.
Spain
Electricity generation and demand in the peninsular market
Millions of kWh
Net electricity generation
Consumption for pumping
Net electricity exports (1)
Electricity demand
2015
254,011
(4,520)
(1,466)
248,025
2014
253,578
(3,406)
(6,628)
243,544
Change
433
(1,114)
5,162
4,481
0.2%
-32.7%
77.9%
1.8%
(1) Includes the balance of trade with the extra-peninsular system.
Source: Red Eléctrica de España (Balance eléctrico: Estadística diaria del sistema eléctrico español peninsular - December 2015 report). Volumes for 2014 are
updated to December 9, 2015.
Electricity demand in the peninsular market in 2015 rose by
with the previous year. This essentially reflected the net effect
1.8% compared with 2014 reaching 248,025 million kWh. De-
of a decline in exports and an increase in imports driven by
mand was entirely met by net domestic generation for con-
lower average sales prices on international markets.
sumption.
Net electricity exports in 2015 decreased by 77.9% compared
kWh), essentially due to greater electricity demand.
Net electricity generation in 2015 rose by 0.2% (433 million
Electricity generation and demand in the extra-peninsular market
Millions of kWh
Net electricity generation
Net electricity imports
Electricity demand
2015
13,547
1,333
14,880
2014
13,289
1,298
14,587
Change
258
35
293
1.9%
2.7%
2.0%
Source: Red Eléctrica de España (Balance eléctrico: Estadística diaria del sistema eléctrico español extrapeninsular - December 2015 report). Volumes for 2014
are updated to January 13, 2016.
Electricity demand in the extra-peninsular market in 2015
Net electricity generation in 2015 rose by 1.9% or 258 million
increased by 2.0% compared with 2014, reaching 14,880
kWh as a result of higher demand for electricity in the extra-
million kWh. Of total electricity demand, 91.0% was met by
peninsular market.
net electricity generation in the extra-peninsular area, with
the remaining 9.0% being met by net electricity imports, all
from the peninsular system. The latter totaled 1,333 million
kWh in 2015.
97
Report on operationsAnnual Report 2015
Electricity prices
Electricity prices
Italy
Spain
Russia
Slovakia
Brazil
Chile
Colombia
Average baseload price
2015 (€/MWh)
Change in baseload
price 2015-2014
Average peakload price
2015 (€/MWh)
Change in peakload
price 2015-2014
52.3
50.3
21.3
33.6
79.8
81.9
119.5
0.4%
9.1%
31.0%
-0.3%
-62.9%
-19.2%
39.6%
58.7
56.8
24.9
42.8
131.2
178.1
585.3
-0.4%
9.8%
33.1%
-0.1%
-52.5%
-14.6%
211.3%
Price developments in the main markets
Eurocents/kWh
Final market (residential): (1)
Italy
France
Portugal
Romania
Spain
Slovakia
Final market (industrial): (2)
Italy
France
Portugal
Romania
Spain
Slovakia
2015
2014
Change (%)
0.25
0.16
0.23
0.13
0.23
0.15
0.11
0.08
0.10
0.08
0.09
0.12
0.24
0.16
0.22
0.13
0.23
0.15
0.12
0.07
0.10
0.08
0.09
0.11
4.2%
-
4.5%
-
-
-
-8.3%
14.3%
-
-
-
9.1%
(1) Annual price net of taxes - annual consumption of between 2,500 kWh and 5,000 kWh.
(2) Annual price net of taxes - annual consumption of between 70,000 MWh and 150,000 MWh.
Source: Eurostat.
Electricity price developments in Italy
Power Exchange - PUN IPEX (€/MWh)
51.8
47.9
56.7
52.8
52.5
46.5
50.4
58.9
1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
2015
2014
Average residential user with annual
consumption of between 2,641 and 4,440
kWh with subscribed capacity of more than
3kW (euro/kWh): price net of taxes
0.24
0.24
0.24
0.25
0.25
0.24
0.24
0.25
Source: GME (Energy Markets Operator); Authority for Electricity, Gas and the Water System.
98
Annual Report 2015
In Italy, the average uniform national sales price of electricity
The average annual price (net of taxes) for residential users
on the Power Exchange rose slightly in 2015, edging up by
set by the Authority for Electricity, Gas and the Water Sy-
0.4% compared with 2014.
stem fell slightly in 2015, declining by 1.1%.
Natural gas markets
Gas demand
Millions of m3
Italy
Spain
2015
64,798
28,657
2014
61,501
25,897
Change
3,297
2,760
5.4%
10.7%
Demand for natural gas in 2015 rose substantially both in
competitiveness of gas costs than those of other conventio-
Italy and Spain. The increase was mainly attributable to more
nal resources.
extensive use in electricity generation owing to the greater
Italy
Domestic gas demand
Millions of m3
Distribution networks
Industry
Thermal generation
Other (1)
Total
2015
31,081
12,705
19,609
1,402
64,798
2014
29,239
13,098
17,368
1,796
61,501
Change
1,841
(392)
2,241
(394)
3,297
6.3%
-3.0%
12.9%
-21.9%
5.4%
(1) Includes other consumption and losses.
Source: Enel based on data from the Ministry for Economic Development and Snam Rete Gas.
Domestic demand for natural gas in 2015 totaled 64,798 mil-
an increase in residential and civil uses associated with the
lion cubic meters, an increase of 5.4% on the previous year.
economic recovery led by private consumption, and greater
The contraction in consumption in industry was offset by
use in conventional generation.
Price developments
Average residential user with annual
consumption of between 481 and 1,560 m3
(euro/m3): price net of taxes
1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
2015
2014
0.51
0.48
0.48
0.49
0.54
0.51
0.47
0.51
Source: Authority for Electricity, Gas and the Water System.
The annual average sales price of natural gas in Italy decreased by 3.2% in 2015.
99
Report on operationsAnnual Report 2015
Regulatory and rate issues
The European regulatory framework
Summer Package
ge also emphasizes that self-consumption will play an in-
creasingly important role in the system and it is therefore
On July 15, 2015, the European Commission presented
necessary to remove all barriers to its spread. At the same
new proposals for action in the so-called Summer Package,
time, it will also be necessary to ensure appropriate finan-
thereby launching the activities provided for in the Energy
cing of network and system costs even in the presence of a
Union document presented in February.
massive expansion of self-consumption.
The package comprises a series of documents intended to
In order to achieve medium and long-term emissions reduc-
give consumers a new role in the energy market (through
tion targets, the Commission has also proposed a reform
a communication on the retail market and a document on
of the ETS, confirming its key role in the European decar-
self-consumption), to launch a redesign of the European
bonization strategy. The document raises the ambition of
electricity market (with a communication and a consultation
on market design) and to revise the EU Emissions Trading
the ETS with a view to achieving a 40% reduction in CO2
emissions by 2030. It also proposes measures to safeguard
System as an instrument for achieving the European emis-
domestic industry from the risk of carbon leakage through
sions reduction targets at 2030 (through a proposal for legi-
compensation mechanisms for costs and to support techno-
slation to revise the ETS Directive).
logical innovation as a driver of the progressive transition to
The package identifies a number of reform needs within the
a low-carbon economy.
European energy sector, including the need to increase in-
tegration, improve flexibility, promote long-term signals, im-
prove the retail market with a key contribution from smart
Market Stability Reserve
grids and strengthen the CO2 market.
More specifically, the energy market must converge to-
On October 6, 2015, the Decision establishing the Mar-
ket Stability Reserve in the EU’s Emissions Trading System
wards greater integration of European electricity markets:
(2015/1814) was published. The introduction of the reserve
the day-ahead market, the intraday market and the balan-
is intended to stabilize the ETS market with an automatic
cing market. In addition, in order to ensure the necessary in-
adjustment mechanism for volumes put to bid in order to miti-
vestment and reduce risks for energy operators, long-term
gate imbalances in supply and demand.
markets will be developed through the definition of long-
The reserve will begin to absorb excess allowances in the ETS
term contracts and the need to use those instruments as
from January 2019: 12% of the surplus allowances accumula-
drivers for achieving decarbonization.
ted by the system will be deducted from the amount at auc-
Market integration will have to involve renewables as well.
tion and transferred to the reserve. The mechanism for deduc-
Such resources must be able to participate in the market
tions from the volumes to be auctioned will only be activated
and be able to provide ancillary services and balancing. As
if the total number of allowances in circulation exceeds 833
they play a fundamental role in the transition to a low-carbon
million. If the total number is less than 400 million, 100 million
economy, renewable resources can, if necessary, be pro-
allowances will be released from the reserve and added to the
moted using competitive mechanisms, such as auctions,
volumes being auctioned. In conjunction with the introduction
using more coordinated approaches at the regional level.
of the Market Stability Reserve, the Decision also provided for
The retail market is also included in the proposals. The role
the transfer to the reserve of the 900 million emissions allo-
of the consumer needs to be updated thanks to greater
wance involved in the backloading mechanism (these volumes
market competition (simplification of switching, access to
were initially to be auctioned in 2019-2020).
real-time consumption data). This will be achieved through
the promotion of smart grids and expanding the dissemina-
tion of smart appliances, which will enable active consumer
REMIT reporting
participation. Distribution system operators will have a very
On October 7, 2015, the first phase of REMIT reporting be-
important role as facilitators of this process, one that will
gan. It involves orders and transactions executed on orga-
have to be supported by incentive mechanisms. The packa-
nized markets and most data on capacity and plant usage.
100
Annual Report 2015 Data on transactions executed outside of organized mar-
Decree 164/2000, calling for the liberalization of the import,
kets, transmission contracts and usage of LNG and storage
production and sale of gas and the separation of network
plants will be transmitted to the Agency for the Cooperation
infrastructure management from other activities through the
of Energy Regulators (ACER) beginning on April 7, 2016.
establishment of distinct companies. As regards the model
The reporting is intended to support market monitoring by
for unbundling transport from other non-network activities,
ACER and national regulators.
with Resolution 515/2013/R/gas, the Authority for Electrici-
Circular Economy Package
On December 2, the European Commission’s Communi-
ty, Gas and the Water System (the “Authority”) mandated
the transition to ownership unbundling pursuant to Directive
2009/73/EC.
cation containing an action plan on the circular economy
The following sections discuss the general regulatory fra-
was published. It also contains legislative measures, na-
mework and the main measures taken in 2015.
mely proposed revisions of the Waste Directives (2008/98/
EC, 1994/62/EC, 1999/31/EC, 2000/53/EC, 2006/66/EC and
2012/19/EC). The plan sets out the measures to be adopted
in the coming years and covers the entire value chain of
materials/products on the basis of the principle of optimal
and efficient use of resources, maintaining the value con-
tained in the materials in the system and minimizing waste.
The measures cover the design, consumption and post-life
management of products, and the management of waste,
byproducts and secondary raw materials, specific measu-
res for certain sectors and financial measures.
The Italian regulatory
framework
The current structure of the Italian electricity market is the
result of the liberalization process begun in 1992 with Direc-
tive 1992/96/EC, transposed into Law with Legislative De-
cree 79/1999. This decree provided for: the liberalization of
electricity generation and sale; reserving transmission and
ancillary services to an independent network operator; the
granting of concessions for distribution to Enel and other
companies run by local governments; the unbundling of net-
work services from other activities.
The introduction of Directives 2003/54/EC and 2009/72/
EC (transposed with Law 125/2007 and Legislative Decree
93/2011, respectively) in Italy lent further impetus to the pro-
cess, particularly through the complete opening of the retail
market and the confirmation of the total independence of
the national transmission network operator (already provi-
ded for in the Decree of the Prime Minister of May 11, 2004)
by separating its ownership from that of other electricity
operators.
The process of liberalizing the natural gas market began with
Directive 1998/30/EC, transposed in Italy through Legislative
101
Report on operationsAnnual Report 2015 Italy
Generation
Electricity
Wholesale production and market
Electricity generation was completely liberalized in 1999
with Legislative Decree 79/1999 and can be performed by
anyone possessing a specific permit.
The electricity generated can be sold wholesale on the or-
ganized spot market (IPEX), managed by the Energy Mar-
kets Operator (GME), and through organized and over-the-
counter (OTC) platforms for trading forward contracts. The
organized platform includes the Forward Electricity Market
(FEM), managed by the GME, in which forward electrici-
ty contracts with physical delivery are traded. Trading can
also be conducted in derivatives with electricity as their
underlying are traded. The organized market for such tran-
sactions is the forward market (IDEX), operated by Borsa
Italiana, while financial derivatives can also be negotiated
on OTC platforms.
Generators may also sell electricity to companies engaged
in energy trading, to wholesalers that buy electricity for re-
sale at retail, and to the Acquirente Unico (Single Buyer),
whose duty is to ensure the supply of energy to enhanced
protection service customers.
In addition, for the purposes of the provision of dispatching
services, which is the efficient management of the flow of
electricity on the grid to ensure that deliveries and withdra-
wals are balanced, electricity generated may be sold on
a dedicated market, the Ancillary Services Market (MSD),
where Terna procures the required resources from gene-
rators.
The Authority and the Ministry for Economic Development
are responsible for regulating the electricity market. More
specifically, with regard to dispatching services, the Autho-
rity has adopted a number of measures regulating plants
essential to the security of the electrical system. These
plants are deemed essential based on their geographical lo-
cation, their technical features and their importance to the
solution of certain critical grid issues by Terna. In exchange
for being required to have electricity available and providing
binding offers, these plants receive special remuneration
determined by the Authority.
Decree Law 91 of June 24, 2014 provides for all schedu-
lable generation units located in Sicily with a capacity of
more than 50 MW to be declared essential to system secu-
102
rity under a cost reimbursement system. The rules will re-
main in force as from January 1, 2015 until the completion
of the “Sorgente-Rizziconi” interconnector between Sicily
and continental Italy, which is scheduled for 2016.
Since the launch of the market in 2004, the regulations
have provided for a form of administered compensation
for generation capacity. In particular, plants that make their
capacity available for certain periods of the year identified
in advance by the grid operator to ensure the secure opera-
tion of the national electrical system receive a special fee.
In August 2011, the Authority published Resolution ARG/
elt 98/2011, which establishes the criteria for introducing
a market mechanism for compensating generation capaci-
ty that replaces the current administered reimbursement.
This mechanism involves holding auctions through which
Terna will purchase from generators the capacity required
to ensure that the electricity system is adequately supplied
in the coming years.
With a decree of the Minister for Economic Development
of June 30, 2014, the capacity market operational mechani-
sm previously issued for consultation by the Authority was
approved.
The mechanism is based on the allotment, by auction, of op-
tion contracts (reliability options) that provide for payment
of a premium, established in the auction with the setting
of a marginal price, against which a generator undertakes
to return any positive difference between the price formed
on the spot electricity and auxiliary services market and a
benchmark price set ex-ante in the option contract.
The rules approved provide for a cap and a floor for the pre-
mium to be paid for existing capacity. The floor is paid for all
existing capacity and will be set by the Authority.
With Resolution 95/2015/R/eel, the Authority proposed to
the Ministry for Economic Development that the opening
of the Capacity Market be moved forward, with an initial
phase of implementation beginning on January 1, 2017 and
ending no later than December 31, 2020, with the launch
of full operation of the mechanism. Under the Authority’s
proposal, during the initial phase, there would be no direct
foreign demand and resources permitted in the market, but
their contribution would be measured for statistical purpo-
ses. The Authority also proposes that, during that phase,
the minimum remuneration for existing capacity be deter-
mined on the basis of the avoidable fixed costs of a com-
bined-cycle plant. This proposal has been submitted to the
Ministry for Economic Development for approval.
Annual Report 2015 On February 24, 2015, the market coupling model for the
Gas
Italian, Austrian, French and Slovenian day-ahead trading
markets was launched. Market coupling is a mechanism
for integrating day-ahead markets (MGP) that, in setting the
electricity prices for the different segments of the Europe-
an market involved, also allocates the transport capacity
available between those segments, thereby optimizing the
use of interconnections.
The Council of State, with its decision of March 20,
2015, affirmed the repeal of the Authority’s Resolutions
342/2012/R/eel, 197/2013/R/eel, 239/2013/R/eel and
285/2013/R/eel containing urgent measures designed to
contain the dispatching costs associated with the imbalan-
cing of plants not admitted to the Ancillary Services Mar-
ket (MSD).
Following the decision, Terna recalculated the revenue and
cost entries pertaining to the imbalancing that had been
invoiced in periods prior to the issue of the decision and
made the relative adjustments.
After the decision was announced, the Authority initiated
the process of consulting with the operators concerning
the specific proposals for reforming the rules on effective
imbalancing, aimed at correcting the distortions that cur-
rently affect it.
With Resolution 333/2015/R/eel, the Authority also began
the process for establishing the procedures for implemen-
ting the Council of State decision for the years 2012, 2013
and 2014.
Wholesale market
The extraction, import (from EU countries) and export of
natural gas have been liberalized.
According to the provisions of Legislative Decree 130/2010,
operators cannot hold a market share that exceeds 40% of
domestic consumption. This limit may be raised to 55% if
the operator commits to creating 4 billion cubic meters in
new storage capacity by 2015. Under this provision, the Mi-
nistry for Economic Development approved Eni’s proposed
plan to create new storage in early 2011. To date, 2.6 billion
cubic meters in new storage capacity has been created.
Law 9/2014 establishes that, in order to limit the costs for
the system, the remaining storage capacity (up to 4 billion
cubic meters) be created only if there is market demand for
it. The operators have not shown any interest in the auc-
tions held and, therefore, no further storage capacity has
been created.
Following the approval of the Parliamentary committees and
the positive opinion of the Authority, on March 6, 2013, the
Ministerial Decree approving the rules for the natural gas
forward market (“MT Gas”) was signed, with operations
beginning on September 2, 2013. The forward market com-
pleted the structure of the Italian wholesale market, joining
the spot trading platform (the “Gas Exchange”), which has
been operating since 2010, and the balancing market begun
in December 2011 under the rules set by the Authority.
With regard to the scheme for greenhouse gas emission
allowance trading established with Directive 2003/87/
Transport, storage and regasification
Transport, storage and regasification (of LNG) are subject to
EC, on December 23, 2015, the Ministry for Economic
regulation by the Authority, which sets the rate criteria for
Development settled an initial tranche of Enel Produzio-
engaging in these activities at the start of each regulatory
ne’s receivable arising in respect of the failure to allocate
period (lasting 4 years) and updates the rates annually.
free allowances and the absence of the right to flexibility
Storage is carried out under a concession (for a maximum
in phase 2 (2008/2012). In addition, the 2016 Stability Act
of 20 years) issued by the Ministry for Economic Deve-
(Law 208/2015) amended Article 19 of Legislative Decree
lopment (MED) to applicants that satisfy the requirements
30/2013, eliminating the deadline of 2015 for payment of
of Legislative Decree 164/2000. The Decree of February 6,
the receivables referred to above.
2015 of the MED retained the criteria established in 2014 for
allocating capacity through auction for 2015 as well.
LNG activities are subject to the grant of a special ministe-
rial permit.
Access to transport, storage and regasification capacity is
provided through non-discriminatory mechanisms establi-
shed by the Authority in order to guarantee third-part access
(TPA). The Ministry for Economic Development may grant an
exemption from the TPA rules to companies that own stora-
103
Report on operationsAnnual Report 2015 ge or regasification plants or cross-border gas interconnec-
tors. The exemption is granted upon the explicit request of
the companies involved and on the basis of an assessment
of the benefits of the infrastructure for the system.
Distribution
Electricity
As to gas transport rates, the Council of State affirmed the
Distribution and metering
Enel Distribuzione provides distribution and metering servi-
voiding of the resolutions setting the rate for the 2010-2013
ces under a 30-year concession set to expire in 2030.
period, denying the Authority’s appeal and accepting the ar-
guments put forth by Enel Trade. The Authority lodged an
The distribution rates are set by the Authority at the start of
appeal against the ruling of the Council of State. The appeal
each regulatory period based on covering the total cost of
of the resolutions establishing the rate criteria for 2014-2017
providing the services, considering operating costs, depre-
is pending before the Regional Administrative Court.
ciation and providing an appropriate return on capital.
The rate component covering operating costs is updated
With Resolution 556/2015/R/gas, the Authority confirmed
annually using a price-cap mechanism (i.e. based on the
the amounts due to companies admitted to the mechanism
inflation rate and an annual rate of reduction of unit costs
for the promotion of renegotiation of long-term gas supply
called the X-factor). The return-on-capital and depreciation
contracts (APR).
104
components are revised each year to take account of new
investments, depreciation and the revaluation of existing as-
sets using the deflator for gross fixed capital formation.
With Resolution 146/2015/R/eel, the Authority published the
reference rates for distribution and sales activities for 2015
to be used in determining, for each operator, the level of
revenue to be recognized for the performance of their ac-
tivities.
With Resolution 654/2015/R/eel, the Authority, in conjun-
ction with the publication of the mandatory grid rates to be
charged to end users in 2016, specified the criteria for the
new rate period for electricity distribution and metering,
which will be in force for the next eight years (2016-2023).
The next rate period has been divided into two sub-periods
of four years each (NPR1 for 2016-2019 and NPR2 for 2020-
2023), with an interim revision scheduled for 2020.
For the first sub-period (NPR1), while the Authority essen-
tially confirmed the general regulatory framework, it intro-
duced substantial amendments concerning the timing and
procedures for remunerating new investments in rates.
More specifically, the Authority reduced the so-called “re-
gulatory lag”, shortening to a maximum of one year (from
the two years in the previous regulatory period) the period
before new investments are recognized in rates, while at the
same time eliminating the increase of one percentage point
of WACC. The latter had been introduced by the Authority in
2012 to offset the financial burden imposed by the delayed
recognition of new investments.
Operators are therefore required to notify the Authority
by the end of the year of their preliminary accounts of in-
vestments made during the year, enabling the Authority to
insert the data in the calculation of the mandatory rate publi-
Annual Report 2015 shed by the end of the year for the subsequent year. These
the relationship between sellers and distributors concerning
investments are then inserted in the regulatory asset base
the guarantees given by sellers to distributors, the payment
as from January 1 of the year following their realization. Con-
terms for the transport service by sellers and the terms of
sequently, operators can match the revenue generated by
payment of the system costs and other components by di-
the investments with their amortization.
stributors to the Electricity Equalization Fund and the Energy
The Authority also increased by five years the useful lives of
Services Operator (GSE). The resolution also provided for
low and medium-voltage power lines that entered service
the elimination starting from 2016 of the uncollectible por-
after December 31, 2007.
tion of turnover withheld by distributors as a result of the
Finally, the level of operating costs recognized and the pro-
strengthening of the system of guarantees. With Resolution
cedures for returning any extra efficiency gains to customers
447/2015/R/eel, the Authority deferred the entry into force
were also specified. More specifically, the Authority maintai-
of the portions of the Code that were originally to have ta-
ned the symmetric division of extra efficiency gains and the
ken effect in October 2015, ordering that the entire Code
restitution until 2019 of gains achieved and temporarily main-
shall enter force as from January 2016. With the subsequent
tained to firms in the third and fourth regulatory periods. The
Resolution 609/2015/R/eel, the Authority eliminated the re-
X-factor used in updating eligible operating costs was set at
quirement for banks and insurance companies that issued
1.9% for distribution operations and 1% for metering activi-
sureties to have a rating (without prejudice to the other re-
ties.
quirements provided for in the Code) and the deadline by
For the second sub-period (NPR2), the Authority announced
which traders may make the initial adjustment of guarantees
the transition to rate regulation based on total costs (the To-
was postponed.
tex method).
With Resolution 583/2015/R/com the Authority revised the
With Resolution 377/2015/R/eel, the Authority completed
method used to determine the rate of return on capital and
the regulatory framework governing losses on the distribu-
set a rate of 5.6% for distribution and metering activities for
tion grid, revising the conventional loss percentages as from
2016-2018. In particular, the Authority established a specific
January 1, 2016 and the equalization mechanism for losses
6-year rate period for the WACC, with a mid-period update
to apply to distributors as from 2015. More specifically, the
of the main parameters in the formula on the basis of ma-
equalization mechanism takes account of the geographical
croeconomic conditions (interest and inflation rates) in 2018.
diversification of losses on distribution grids.
As regards service quality, the Authority, with Resolution
With its Resolution 296/2015/R/com, the Authority amended
646/2015/R/eel, established output-based regulation for
the functional unbundling requirements for operators in the
electricity distribution and metering services, including the
electricity and gas sector.
principles for regulating service quality for 2016-2023 (TIQE
In the resolution, the Authority confirmed that companies
2016-2023).
must maintain a separation between the brand and com-
The resolution retains the existing general approach to go-
munication policies (including the company name) of the di-
verning service quality, which provides for the Authority to
stribution companies and those of the companies that sell
set annual trend levels for the following service continuity
power. Furthermore, in the electricity sector, there must also
indicators for low-voltage customers:
be a separation between those companies that sell electrici-
> duration of long-service interruptions;
ty on the free market and those that do so on the enhanced
> number of long and short-service interruptions.
protection market.
Separate rules apply to medium-voltage customers.
Commercial activities related to distribution, especially inter-
Distributors receive bonuses or penalties each year, depen-
facing with the end user, must be conducted utilizing infor-
ding on whether actual performance, as determined on the
mation channels, physical locations and personnel that are
basis of the continuity indicators, exceed or fall short of the
distinct from those used for the sale of electricity and natural
specified trend levels.
gas. These separation requirements apply to companies that
The resolution also indicates the start of future regulation for
sell electricity on the free market and to those on the enhan-
innovative investment in the distribution grid.
ced protection market.
With Resolution 268/2015/R/eel, the Authority established
The provisions are effective immediately. However, compa-
the Model Grid Code for transport services, which governs
nies have until June 30, 2016 to meet the new requirement
105
Report on operationsAnnual Report 2015 for the separation of brand and communication policies. The
by May 31 of each year that they hold a number of white
deadline for compliance with the provisions on the use of
certificates equal to at least 50% (60% for years 2015-2016)
separate information channels, physical locations and per-
of their obligation, with the residual obligation be covered in
sonnel is January 1, 2017.
the subsequent years.
The decree also set out the process for transferring mana-
With Resolution 582/2015/R/eel the Authority, in implemen-
gement of the white certificate mechanism to the Energy
tation of Legislative Decree 102/2014 transposing the EU
Services Operator (GSE), while the Authority will remain
directive on energy efficiency, initiated, with effect from
responsible for determining the rate grant using the new
January 1, 2016, the reform of electricity rates for residen-
criteria set out in the Ministerial decree.
tial customers. The goal of the reform is to eliminate the
The Authority, with its Resolution 13/2014/R/efr, introduced
progressivity of the grid rate and system charges so as to
a mechanism for recovering the costs of purchasing white
encourage efficient consumption and to eliminate the exi-
certificates. It allows distributors to recover a cost equal to
sting system of cross-subsidies among various categories of
the market average, less a spread of €2 per certificate.
residential customers in order to ensure that rates are con-
The potential financial impact of the mechanism is thereby
sistent with the real costs of the service. The reform will be
significantly reduced, although distributors are still subject
implemented gradually, entering full force as from January 1,
to the “physical” obligation to deliver the EECs in order to
2018. The Authority also established that as from January 1,
meet the national targets.
2017 the diversification of levels of contractual power will be
Legislative Decree 102 of July 4, 2014, implementing Direc-
increased, so as to give end users greater choice in selecting
tive 2012/27/EU on energy efficiency, set out the cumulative
the volume most appropriate to their needs. In addition, for
national energy savings target for the 2014-2020 period to
at least two years (as from January 1, 2017), the amount of
be achieved using a variety of incentives. It also established
connection fees and other fixed charges that customers pay
that the EEC mechanism must result in a savings of at least
to distribution companies for changes in power levels carried
60% of such target by 2020.
out remotely will be reduced from their current levels.
The decree also required the MED, in the course of updating
In parallel, in order to neutralize any rate increases for custo-
the guidelines on the procedures for issuing EECs, to inclu-
mers in financial hardship, the Authority updated, as from
de measures for making the mechanism more efficient, en-
January 1, 2016, the amount of the social bonus.
hancing energy savings achieved through measures aimed
On December 10, 2015, the Competition Authority (AGCM)
With Decision 13/2015 of June 29, 2015, the Authority set
notified Enel SpA and Enel Distribuzione SpA of the start of
the definitive rate subsidy for 2014 equal to €105.83/toe.
a penalty proceeding aimed at ascertaining the existence of
The preliminary rate subsidy for 2015 was set at €108.13/
a Group strategy intended to hinder the development of the
toe and will be revised based upon the final market price for
at improving practices and preventing speculative practices.
smart metering market. Unless extended, the proceeding is
the reference period.
scheduled to be completed by December 31, 2016.
Energy efficiency - white certificates
Energy efficiency in final uses has been promoted in Italy
mainly through the Energy Efficiency Certificate mecha-
nism (EECs or white certificates) launched on January 1,
2005 in accordance with the provisions of the related de-
crees of July 20, 2004.
The mechanism requires the Ministry for Economic Deve-
lopment (MED) to determine the national energy savings
targets that must be achieved each year by electricity and
gas distribution companies.
With the decree of December 28, 2012, the MED establi-
shed the energy savings targets for the 2013-2016 period.
In order to avoid penalties, distributors must demonstrate
106
Annual Report 2015 Sales
Electricity
IIS to manage contract transfers and switching, as well as
significantly expanding the central database, in order to sim-
plify data exchange among operators on the main customer
management processes, including metering information.
As provided for by Directive 2003/54/EC, starting from July
1, 2007 all end users may freely choose their electricity sup-
On February 20, 2015 the government approved the “Com-
plier on the free market or participate in regulated markets.
petition Bill”, which provides for the repeal of the temporary
Law 125/2007 identified these regulated markets as the
rules governing gas and electricity prices as from Janua-
“enhanced protection” market (for residential customers
ry 1, 2018. The Bill, currently being debated in Parliament,
and small businesses with low-voltage connections) and
establishes that the consequent measures shall be adopted
the “safeguard” market (for larger customers not eligible
with a decree of the MED and assigns the Authority the
for enhanced protection services).
task of drafting the measures to ensure provision of univer-
Free-market operators are awarded contracts to provide sa-
sal service. In order to define a reform of existing market
feguard services on a geographical basis through three-year
mechanisms for customer protection, in 2015 the Authority
auctions. Enel Energia was awarded contracts to provide
began a specific proceeding to govern transitional solutions
services to five of the ten areas subject to auction for the
within the scope of the reform.
2014-2016 period (Veneto, Emilia Romagna, Friuli Venezia
Giulia, Sardinia, Campania, Abruzzo, Calabria and Sicily).
By contrast, enhanced protection service is provided by sel-
Gas
lers connected with distributors.
Legislative Decree 164/2000 established that as from Ja-
nuary 1, 2003, all customers may freely choose their natu-
Prices are set by the Authority and are updated quarterly ba-
ral gas supplier on the free market.
sed on criteria designed to ensure that the operators’ costs
However, sales companies must also offer a safeguard ser-
are covered. More specifically, the Authority periodically
vice to their customers (only for residential customers pur-
updates the component for covering the operators’ costs
suant to Decree Law 69 of June 21, 2013), together with
in the enhanced protection market (RCV) so as to ensure
their own commercial offers, at the regulated prices esta-
that their costs are covered (operating costs, delinquency
blished by the Authority.
charges and amortization and depreciation) and that they
If there is no company supplying this service, the conti-
receive a fair return on capital. Resolutions 670/2014/R/eel
nuity of supply for small customers not in arrears on bill
and 659/2015/R/eel established rates for 2015 and 2016.
payments (residential and other uses with an annual con-
Operators set their own prices for free market services,
sumption of less than 50,000 standard cubic meters) and
with the Authority’s role limited to setting rules to protect
for users involved in providing public services shall be en-
both customers and operators.
sured by the supplier of last resort. If the customer is in
arrears with bill payments or it is not possible for the sup-
In recent years, the Authority has adopted measures aimed
plier of last resort to provide service, supply continuity is
at containing operators’ credit risk, which has risen in re-
ensured by the default distribution supplier selected, like
cent years due in particular to the economic crisis.
the supplier of last resort, through voluntary tenders for
More specifically, in 2015, with Resolution 258/2015/R/com,
geographically-based contracts. The public procedures car-
the Authority took action to increase the accountability of
ried out in September 2014 identified the suppliers of last
distributors in cutting off service to customers in arrears.
resort for the period October 1, 2014 - September 30, 2016.
The Authority is also continuing the implementation of the
Enel Energia was selected as supplier of last resort for 7
Integrated Information System (IIS). This system, establi-
out of the 8 geographical areas covered by the auction and
shed under Law 129/2010, is designed to manage the flow
as default distribution supplier for 6 out of 8 areas.
of information between gas and electricity market opera-
tors and is based upon a central database of withdrawal
Starting from October 1, 2013, the reform of the financial
points, initially created for the electricity sector and exten-
terms and conditions applied to safeguard market custo-
ded to the gas sector in 2015.
mers entered force. In this situation, the Authority modi-
In other 2015 developments, the Authority provided for the
fied the procedures for determining the raw material com-
107
Report on operationsAnnual Report 2015 ponent, indexing it fully to spot market prices, introduced
components to ensure a gradual transition (including one
Renewable energy
specifically for the renegotiation of long-term contracts)
In Italy, a variety of mechanisms, differing by resource and
and increased the component covering retail sales costs to
size of plant, are used to encourage electricity generation
enhance cost-reflectivity.
from renewable resources. The objectives and support in-
With regard to the raw material (gas) cost component, on
struments are established by Parliament in a manner consi-
January 24, 2014, the Regional Administrative Court of
stent with EU directives in this sector, while implementation
Lombardy, in the course of an action brought by Enel Ener-
is handled by the Energy Services Operator (GSE), which is
gia and Enel Trade, voided the resolutions by which the Au-
responsible for managing incentives for renewables.
thority changed the formula for determining (and thereby
reducing) the QE component for the 2010-2011 and 2011-
2012 gas years. On April 10, 2014, the Authority filed an
appeal with the Council of State.
Solar power incentives - Energy
Account
With regard to the definition of the component covering na-
Existing photovoltaic plants receive incentive through the so-
tural gas supply rates, the Authority also confirmed the cur-
called Energy Account, a mechanism which consists in the
rent procedures for the 2015-2016 gas year, with full inde-
payment of feed-in premiums over and above the price of
xing to the spot prices reported on the Dutch Title Transfer
the electricity for power delivered to the grid over 20 years.
Facility (TTF), pending the development of greater liquidity
With the Ministerial Decree of July 5, 2012, the incentive
in the Italian wholesale markets.
system for photovoltaics was overhauled in order to ensure
the more orderly growth of the sector and realign tariffs with
With Resolution 258/2015/R/eel, the Authority, in addition
European averages. The Fifth Energy Account is based on a
to stiffening penalties for distributors who fail to cut off
system of comprehensive feed-in tariffs that have been re-
customers in arrears (similar to measures for the electricity
duced by an average of 40% from the previous system. The
industry), reduced the time period allowed for switching to
decree sets an annual ceiling on total incentives (including
three weeks starting from 2016.
those already paid out under the previous Energy Accounts)
of €6.7 billion, which was reached on June 6, 2013, thereby
terminating incentives for new plants.
Renewable resources other than
photovoltaic: auctions, green
certificates and comprehensive
rates
The primary incentive mechanism in use today to support
renewable energy technologies other than photovoltaics is
a system of subsidized rates awarded either directly or in
Dutch auctions organized by the GSE. The mechanism was
established with Legislative Decree 28/2011 transposing Di-
rective 2009/28/EC and the associated Ministerial Decree
with implementing measures of July 6, 2012.
More specifically, small plants (with a capacity of up to 5
MW, as well as hydroelectric plants up to 10 MW and geo-
thermal plants up to 20 MW) will receive incentives through
comprehensive rates differentiated by type and size of the
plant. Larger plants qualify for additional incentives over the
market price, established on the basis of Dutch auctions run
by the GSE. Plant owners must submit bids for a percentage
reduction from the opening price, equal to the comprehen-
108
Annual Report 2015 sive rate for the last capacity bracket for small plants. The
2013, in order to foster better programming and integration
value of the incentive is then set net of the zonal hourly price
of such plants into the national electrical system.
for electricity.
Following an appeal lodged by a number of associations of
renewables generators, the Council of State voided Resolu-
Plants that entered service by December 31, 2012 qualify for
tion 281/2012/R/efr, at the same time establishing the stan-
a green certificates mechanism (introduced with Legislative
dards to be followed by the Authority in properly regulating
Decree 79/1999). Under this system, electricity producers
the subject matter. More specifically, the Council of State
and importers are required to deliver a share of renewable
clarified that non-schedulable resource plants must partici-
energy. This obligation can be satisfied by purchasing green
pate in sharing imbalancing costs, thereby avoiding impro-
certificates from renewables generators.
per socialization of costs. Likewise, the regulation must take
The amount of the incentive depends upon the market value
into account the specific characteristics of each resource in
at which operators can purchase green certificates to meet
terms of predicting the delivery of electricity to the grid.
their obligation. This market value is set within a range. The
The Authority, with Resolution 522/2014/R/eel, reimposed im-
maximum value (cap) is equal to the price at which the GSE
balancing payments on NSRRs, in accordance with the gui-
places the certificates it holds on the market (calculated as
delines of the Council of State, starting from January 1, 2015.
provided for in Article 2, paragraph 148 of Law 244/2007),
which came to €124.90/MWh for renewables generation in
2014. The minimum price is equal to the price at which the
GSE withdraws green certificates exceeding the required
share from the market. For the years in the period from 2011
to 2015, that price is set each year at 78% of the difference
between €180/MWh and the average sales price for electri-
city for the preceding year.
The green certificates mechanism will be gradually elimina-
ted through:
Iberian Peninsula
Spain
Voluntary Price for Small
Consumers
> the progressive reduction of the mandatory share to zero
On June 4, 2015, the operating rules for hourly billing of cu-
by 2015;
stomers that use the “Precio Voluntario del Pequeño Consu-
> the provision of incentives to plants already participating
midor” (PVPC, Voluntary Price for Small Consumers) were
in the green certificate system through rates equivalent to
published. Accordingly, as from July 1, 2015, the bills of con-
the current withdrawal value of certificates (as from 2015).
sumers with remotely readable meters will be calculated on
In order to ensure control of incentive costs, the decree of
the basis of the actual hourly consumption rather than on the
July 6, 2012 sets a ceiling of €5.8 billion on aggregate annual
basis of an estimated consumption profile.
cost – including plants already receiving incentives through
As from October 1, 2015, nearly six million customers in-
the green certificate system – of incentives for resources
cluded under the regulated rate system (PVPC) with a re-
other than solar power.
Imbalancing for non-schedulable
plants
In addition to direct incentives (special rates and green cer-
motely managed smart meters were included in the hourly
rate system, where prices are determined on the basis of
the outcomes of the day-ahead market.
Social bonus
tificates), non-schedulable renewable resources (NSRRs)
Law 24/2013 introduced the social bonus as a public service
were exempt from fees for imbalancing (the difference
obligation, the cost of which is borne by the parent compa-
between actual power delivered to the grid and planned po-
nies of companies that generate, distribute and sell electricity
wer deliveries defined on the basis of energy markets). With
in proportion to the sum of connection points and number of
the increase in non-schedulable renewable resource plants
customers served.
– essentially photovoltaic and wind – the Authority, with Re-
With Orden IET/2182/2015 of October 15, the percentage
solution 281/2012/R/efr, decided to eliminate the previous
shares for 2015 were established. Endesa’s share was set at
exemption from imbalancing payments as from January 1,
41.26%.
109
Report on operationsAnnual Report 2015 Voluntary service interruptions
Other regulatory changes
Voluntary service interruption is a compensated service,
On October 15, 2014, Law 18/2014 concerning urgent me-
provided by those consumers who are to reduce their con-
asures for expansion, competition and efficiency enhance-
sumption when the system is under stress, making it possi-
ment was approved. Among other things, the law reforms
ble to efficiently manage demand.
the methods for remunerating the gas system with the goal
Orden IET/2013/2013 requires that voluntary service inter-
of making it economically sustainable and of minimizing the
ruption be assigned through an auction managed by the
costs for the end consumer. Furthermore, the law introdu-
System Operator so as to ensure effective performance of
ces the National Energy Efficiency Fund to help achieve the
the service and to minimize the costs to the system. During
energy efficiency targets.
August and September 2015, auctions were held to assign
the service for 2016, with a total value of €503 million for
the system.
Distribution
Allocation mechanism for
remuneration of new wind and
photovoltaic installation in the
extra-peninsular system
Royal Decree 1048/2013 establishes the principles for the re-
Orden IET/1953/2015 amends Orden IET/1459/2014, which
muneration of the distribution of electricity which incorpora-
developed the exceptions provided for by the Electricity
tes factors that will guide future compensation for this activi-
Sector Act and exempted a maximum of 450 MW of wind
ty. The principles set out in the decree are as follows:
power in the Canary Islands from the use of auction pro-
> only the costs required to provide distribution service are
cedures, as well as postponing deadlines for entry in the
remunerated;
register of specific remuneration.
> mechanisms for controlling investments are established;
In addition, the order: (i) eliminates the need to post gua-
> investments that have not yet been amortized or depre-
rantees; (ii) requires only a favorable environmental impact
ciated are remunerated on the basis of the net value of
decision; (iii) requires only a communication from the grid
the asset and the rate of remuneration is equal to the
operator describing delivery capacity or the expected date
average yield on Spanish government securities plus 200
the capacity will be available; and (iv) establishes that to re-
basis points;
ceive the investment incentive to reduce generation costs,
> in order to improve quality and reduce losses and fraud,
the plant must enter service within 24 months of the notifi-
the regulation includes incentive and penalty mechanisms;
cation of entry in the register (preallocation status).
> during 2014 and lasting until the new regulatory period be-
gins, the remuneration for distribution was calculated by
applying the methodology envisaged in the second annex
to Royal Decree Law 9/2013.
Royal Decree 1073/2015 of November 27, concerning the
Regulation of electricity generation
and dispatching in electricity
systems in extra-peninsular areas
remuneration of distribution services, was published. An-
The Royal Decree on generation in extra-peninsular areas
nual discounting based on inflation in unit values was eli-
was published on August 1, 2015. It establishes a system
minated.
similar to the existing arrangements, which include remune-
In addition, on December 12, Orden 2660/2015 was publi-
ration of fixed costs, which considers all fixed investment,
shed. It establishes the unit values for investment and for
operation and maintenance costs, and remuneration of va-
operation and maintenance used in determining the remu-
riable costs, which considers the cost of fuel, grants under
neration of distribution services in accordance with the rele-
Law 15/2012 and tax measures for energy sustainability.
vant method for the 2016-2019 regulatory period.
Certain aspects of the method were modified in order to
improve the efficiency of the system. The method is ap-
plicable as from its entry into force, albeit with a transition
period as from January 1, 2012. The Royal Decree also de-
velops aspects of Law 17/2013 on guaranteeing supply and
increasing competition in electrical systems.
In accordance with Law 24/2013 governing the electricity
110
Annual Report 2015 industry, the net financial remuneration rate is connected
with the secondary market yield on 10-year Spanish go-
vernment securities, increased by an appropriate spread.
For the first regulatory period, which ends in December
2019, the net rate will be equal to the average yield on the
secondary market in April, May and June 2013 plus a spread
of 200 basis points.
Self-consumption
France
Law 344/2014 - Suspension of
regulated electricity and gas rates
for industrial customers
In 2015, Law 344/2014 was implemented. It calls for the gra-
dual abolition of regulated electricity and gas rates for indu-
strial consumers, starting from January 1, 2015 for the gas
sector and from January 1, 2016 for the electricity sector. In
Royal Decree 900/2015 was approved on October 9, 2015.
addition, the measures give alternative suppliers access to
The measure governs the administrative, technical and fi-
the data of consumers who still use regulated rates, impro-
nancial conditions of supply and generation with self-con-
ve switching procedures and set out a temporary offer for
sumption. The decree defines the fixed and variable-rate
customers who have not selected a supplier at the time the
components due from self-producing installations to cover
regulated rate system comes to an end.
system costs (energy policy, renewable energy and coge-
neration incentives, capacity payments, voluntary service
interruption and auxiliary services).
Electricity rates
National energy transition act
On August 17, 2015, Law 992/2015 on the energy transition
was published in the official journal. It sets out the basic
guidelines for the new national energy strategy:
Royal Decree Law 9/2015 was published. The legislation con-
> cutting greenhouse gases by 40% by 2030 compared with
cerns urgent measures to reduce the tax burden, which re-
1990 levels;
duced by 40% the fees paid by consumers to cover capacity
> achieving a renewable energy target of 32% of overall
payments between August 1 and December 31, 2015.
gross energy consumption by 2030 (around 40% of overall
Orden IET/2735/2015 of December 17 was published. It sets
electricity consumption);
access rates for 2016, maintaining those in effect in 2015
> reducing final energy consumption by 50% by 2050, with a
with the exception of customers with connections of betwe-
focus on the building sector;
en 30 kV and 36 kV (-6.7%). The unit components covering
> capping nuclear capacity at 63.2 GW and limiting the share
the capacity payment were also reduced by 21%.
of nuclear power to 50% of domestic generation in 2025,
Gas rates
Orden IET/2736/2015 was published. It establishes the tolls
with a cap of 63 GW.
Belgium
for third-party access to natural gas transport and distribution
With a decree of March 31, 2015, the Belgian government can-
infrastructure. More specifically, rates for 2016 are unchanged
celled the tender called for the construction of two gas-fired po-
with the exception of raw material component, which has
wer plants.
been increased by 10%.
Despite the moratorium on nuclear power plants provided for in
Energy efficiency
a law of January 31, 2003, with a law enacted on June 28, 2015,
Belgium postponed the closure of the Doel 1 and 2 plants by 10
years.
Orden IET/289/2015 of February 20 set out the methodology
On November 30, 2015, agreement was reached between the
for defining energy efficiency obligations, those required to
government and Engie on the definition of an annual fee as from
participate and their share of such amounts as well as their
2016 of €20 million for Doel 1 and 2 and a nuclear tax of about
economic equivalence for 2015.
€150-200 million/year for other nuclear power facilities. The agre-
ement must be approved by the Belgian parliament.
Belgium’s Nuclear Safety Agency finally approved the restart of
Doel 3 and Tihange 2 in November 2015 (the two plants were first
111
Report on operationsAnnual Report 2015 closed in 2012 after an inspection had found hydrogen flaking).
50,000 gigacalories (GCal) (including residential customers).
Romania
Distribution rates
On December 7, 2015, the national regulatory, ANRE, mo-
dified the method used to set distribution rates that had
been approved in 2013 for the third regulatory period cove-
ring the years from 2014 to 2018. A cap of 10% was intro-
duced on the annual increase in distribution rates.
On December 14, 2015, ANRE published distribution rates
for 2016, with a reduction of about 15% on the previous year.
Supplier-of-last-resort rates
On December 24, 2015, ANRE published the rates for sup-
pliers of last resort in force as from January 1, 2016. The
rates applicable to residential customers were reduced by
5.36%. The rates provide for a supply cost of 4.7 lei/month
and ensure suppliers of last resort a regulated profit of 1.5%.
Smart metering
In 2015, the Enel Group distribution companies in Roma-
nia completed the installation of 30,000 digital meters and
submitted a plan to ANRE for the mass roll-out of an ad-
ditional 2.7 million digital meters in the 2016-2020 period.
Installation is subject to approval of the plan by ANRE, which
is expected to be granted on March 15, 2016.
Russia
Heat market
On December 1, 2014, Federal Law 404/2014 concerning
heat supplies was enacted. It represents one of the first im-
plementing acts of the reform of the heat market, which was
initiated with government Decree 1949/2014 of October 2,
2014. The law introduces, with effect from January 1, 2015,
the possibility of entering into bilateral contracts for heat
Start of trading on gas exchange
On October 24, 2014, trading began on the first gas exchange
in Russia, established by the St. Petersburg International Mer-
cantile Exchange (SPIMEX). For now, the only contracts traded
are for volumes to be delivered in the subsequent month, but
in the near future the exchange will also offer weekly and daily
products. Gazprom and other independent gas producers are
being encouraged to channel some of their output through the
trading platform. The exchange rules give Gazprom the right
to handle half of the volumes, with independent suppliers
handling the remainder. For 2015, the goal is to achieve a tra-
ding volume of at least 35 billion cubic meters. The volumes of
gas traded on the exchange have priority in transportation. The
launch of the gas exchange is a key stage in the liberalization of
the gas market and enhancing price transparency.
Temporary suspension of the
system of guarantees for electricity
purchases
On December 24, 2014, the Market Council published a
number of amendments to the market operating rules, by
which it: (i) increased the penalties that apply in the event
of late payments; (ii) extended the period for temporary
exemption from the requirement to furnishing guarantees
for electricity purchases until the end of May 2015 (original-
ly running from December 21, 2014 to the end of February
2015), which applies to operators with no payment arrears
for an amount of up to 30% of the volumes purchased on
the market monthly.
On May 18, 2015, the Market Council: (i) further extended
the period of temporary exemption until August 31; and (ii)
reduced to 20% the minimum debt threshold for purchasers
beyond which financial guarantees are triggered (instead of
the 30% currently in effect). On September 22, 2015, the
Supervisory Board again extended the exemption to Decem-
ber 28, 2015.
producers and consumers of steam and/or industrial users
Indexing of natural gas rates
of directly connected heat, with prices being negotiable up
to a ceiling determined on the basis of the relevant tariffs. As
from January 1, 2018, it will also be possible to use bilateral
contract for the supply of steam and/or heat at fully libera-
lized prices for directly connected industrial users, with the
exception of users with an annual consumption of less than
On June 28, 2015, the Federal Tariff Service (FTS) approved
the indexing of 7.5% of the natural gas rates charged to indu-
strial users (in effect as from July 1, 2015). The increase is in
line with the outlook for the socio-economic development of
the Russian Federation for the years 2015-2017, published by
the Ministry for Economic Development in 2014.
112
Annual Report 2015 Update of the legislative framework
for renewables
Long-term reserve capacity
With a government decree published on November 5, 2015,
On July 28, 2015, the government published Decree 1472,
an auction system was introduced for 15-year purchase con-
with which it introduced a number of modifications of the
tracts. The goal is to promote the building of new generation
auction mechanism for the capacity of new renewables
plants in areas with a capacity shortfall. The decree envisages
plants: for 2016-2018 it reduced the mandatory share of local
that:
component content for wind plants (from 65% to 25-55%);
> the list of such areas shall be determined by the Minister
it increased the maximum amount of eligible capital expen-
of Energy and the system operator by February 1, 2016;
diture by 70%; and it extended the period of validity of the
> the auctions will only be held in the case of actual need.
support system from 2020 to 2024, with a consequent redi-
The first auctions, to be held by July 1, 2016, will take
stribution across the years of the total volume of capacity to
place on the basis of a government decision;
be awarded through auctions for wind plants (3,600 MW).
> bids will be selected on the basis of the capacity price
Reform of the capacity market
requested, as calculated by the Market Council on the
basis of the bids received;
> a cap is imposed on the unit CAPEX of the projects
On August 31, 2015 the government published Decree 893
submitted.
and government Order 1561-p launching the reform of the
capacity market (KOM). The following are the main aspects
of the reform:
Essential plants
> as from 2016, selection of capacity four years in advan-
On January 1, 2015, government Decree 2578-p came into
ce of the one-year period covered by the contract; the
force, providing for: (i) the recognition of essential power
previous mechanism had provided for selection only one
plants with a total capacity of up to 7.5 GW (including the Ne-
year in advance. Accordingly, the auction for delivery in
vinnomysskaya plant with a capacity of 1.1 GW) for the period
2020 will be held in 2016;
from January 1, 2015 to November 30, 2015 (11 months); (ii)
> revision of the mechanism for establishing KOM prices:
the recognition of essential plants to supply heat with a total
a decreasing elastic demand function is defined for each
capacity of up to 3.2 GW for the period from January 1, 2015
of the two price zones depending on the volume of capa-
to June 30, 2015 (six months); (iii) the establishment of the
city offered. This is used as the basis for calculating the
regulated rates that apply to essential plants.
universal price applied to all selected plants. Under the
previous mechanism, the price was determined by the
With two subsequent government decrees, the status of
market on the basis of the last bid accepted;
essential plant assigned to the Nevinnomysskaya plant was
> the KOM price is adjusted annually by real inflation for the
extended first from January 1, 2016 to December 31, 2019
previous year less 1% (as from January 1, 2017);
(four years) and then to the final month of December 2015.
> an increase in penalties for “unreliable plants” (plants
The rate paid to that plant for 2015 and 2016 is equal to
with a usage factor of less than 30% and unavailability
132,999 RUB/MW.
of more than 10% in the 12 months prior to the KOM
auction) and for new plants in the case of unscheduled
unavailability; possible decreases in maximum penalties
Payment rules
for other plants (pending approval of the methodology for
On November 5, 2015 the federal law governing the streng-
revising penalties).
thening of payment rules for consumers of energy resources
was published. It provides for: (i) an increase in penalties for
On November 2, 2015 the results of the capacity auction for
users with poor payment records in the retail markets for
2016 were published: all of the capacity of Enel Russia bid
electricity, heat, gas and water; (ii) a requirement for certain
(7.5 GW) was selected at a price of 112,624 RUB/MW/month.
groups of such users to provide bank guarantees.
On December 18, 2015 the results of the capacity auctions
for 2017 to 2019 were published: the resulting KOM prices
were: 113,208 RUB/MW/month for 2017, 100,993 RUB/MW/
month for 2018 and 110,451 RUB/MW/month for 2019.
113
Report on operationsAnnual Report 2015 Slovakia
Nováky power plant
Latin America
The Group operates in Latin America in Argentina, Brazil, Chi-
le, Colombia and Peru. Each country has its own regulatory
With regard to the Nováky thermal power plant (ENO), which
framework, the main features of which are described below
is regulated under a special system (since it is fueled by ligni-
for the various business activities.
te), the local regulatory authority (URSO) recognizes the costs
incurred by the plant in an annual decree. With its decision
Under the regulations established by the competent autho-
of April 24, 2015, URSO set the amount payable to ENO at
rities (regulatory authorities and ministries) in the various
€66.3112/MWh for 2015 and €70.7113/MWh for 2016. With
countries, operators are free to make their own decisions
a decision of the Minister for the Economy of September 2,
concerning investment in generation. Only in Argentina, fol-
2015, the termination of the special system, initially schedu-
lowing the change in energy policy in recent years, is there a
led for 2020, was postponed until 2030. The annual volumes
regulatory framework that envisages greater public control of
of electricity generation and delivery that the plant must gua-
investments. In Brazil plans for new generation capacity are
rantee between 2017 and 2030 were set at 1,584 GWh and
imposed by ministerial order, and this capacity is developed
1,350 GWh respectively. In order to ensure compliance with
through auctions open to all.
the ministerial decision, it will be necessary to carry out in-
All of the countries have a centralized dispatching system
vestments at the plant.
with a system marginal price. Usually, the merit order is cre-
ated based on variable production costs that are measured
periodically, with the exception of Colombia, where the merit
order is based on the bids of market operators.
Currently in Argentina and Peru, regulatory measures are in
place governing the formulation of the spot market price. In
Argentina, the measure, adopted in 2002 following the eco-
nomic and energy crisis that affected that country, is based
on the assumption that there are no restrictions on the supply
of gas in the country. Nevertheless, in view of the current
financial challenges faced by the wholesale market, the go-
vernment has announced its intention to modify the existing
regulatory framework and, in 2013-2014, develop an electrici-
ty market based on a cost-plus model.
Long-term auction mechanisms are widely used for whole-
sale energy and/or capacity sales. These systems guarantee
continuity of supply and offer greater stability to generation
companies, with the expectation that this encourages new
investments. Long-term sales contracts (up to 30 years) are
used in Chile, Brazil, Peru and Colombia. In Brazil, the price
at which electricity is sold is based on the average long-term
auction prices for new and existing energy. In Colombia, the
price is set by auction between the operators, which usually
enter into medium-term contracts (up to four years). Finally,
a regulatory framework recently introduced in Chile and Peru
allows distribution companies to sign long-term contracts to
sell electricity on regulated end-user markets.
Chile, Peru and Brazil have also approved legislation to encou-
rage the use of unconventional renewable resources, which
sets out the objectives for the contribution of renewable re-
sources to the energy mix and governs their generation.
114
Annual Report 2015 Distribution and sale
and sales markets, while in Brazil, as previously mentioned,
there are no explicit restrictions on integration in the electrici-
Distribution is performed mainly under concession arran-
ty sector, although administrative authorization is required for
gements, using long-term contracts (ranging from 30 to 95
business combinations that would result in market share of
years or in some cases with unspecified terms), with regu-
over 40%, or that involve a company whose annual turnover
lations governing prices and network access. Distribution
exceeds BRL 400 million (about €177 million).
rates are revised every four years (Chile, Peru and the region
of Brazil served by Coelce) or five years (Colombia and the
region of Brazil served by Ampla). As a result of the Ley de
Emergencia Económica (the economic emergency law) of
2002, no rate reviews have yet been conducted in Argenti-
Chile
Energy Agenda
na, despite rules mandating such revisions every five years.
On May 15, 2014, President Michelle Bachelet presented the
In Chile, Brazil and Peru, distribution companies hold auctions
new Energy Agenda containing the primary energy policy
to procure electricity for regulated market customers, while
targets. The document sets out the timetable and identifies
in Colombia sales companies negotiate prices directly with
the parties involved in the next regulatory steps to be taken
generation companies, passing through the average market
and lays out the plans of investments that the government
price to end users. In general, all countries have implemen-
intends to make by the end of its term.
ted a remuneration approach based on the RAB and a rate of
More specifically, the Agenda envisages a more active role
return tied to the WACC, which ensures remuneration of the
by the state and calls for reducing marginal electricity costs
capital employed. The liberalization of the end-user market is
on Chile’s Sistema Interconectado Central, or “SIC” (30%
generally at a fairly advanced stage, though not yet comple-
reduction in the 2013 average by 2017), redefining the rules
te. Eligibility thresholds are set at 30 kW in Argentina (20%
for auctions between generators and distributors in order
of volumes in 2010), 3 MW in Brazil (30% of volumes), 0.3
to reduce the resulting price (25% reduction over the next
MW in Chile (40% of volumes), 0.1 MW in Colombia (35%
10 years as compared with the 2013 price), setting a target
of volumes in 2010) and 0.2 MW in Peru (44% of volumes).
for 45% of new installed capacity to be supplied by uncon-
Free-market customers can sign bilateral contracts with ge-
ventional renewable energy (ERNC) by 2025, establishing
neration companies for electricity. The regulatory authorities
the target of cutting energy consumption by 20% by 2020,
set the rates for regulated market customers.
establishing a system for participation in energy planning,
Limits on concentration and
vertical integration
In principle, existing legislation permits companies to take
part in a variety of activities in the electricity sector (gene-
ration, distribution, sales). Usually, greater restrictions are
imposed on participation in transmission activities so as to
ensure that all operators have adequate access to the net-
developing interconnection projects between the SIC and
the SING (Sistema Interconectado del Norte Grande) and, fi-
nally, introducing a new law for the promotion of geothermal
power by 2015.
Furthermore, the Agenda contains both short-term mea-
sures (aimed at making access to regasification structures
more transparent) and long-term measures (aimed at expan-
ding current capacity) for encouraging the use of natural gas
in generating electricity.
work. There are special restrictions on generation and distri-
Law on interconnection
bution companies holding stakes in transmission companies
in Argentina, Chile and Colombia. Furthermore, in Colombia
companies formed after 1994 may not adopt or maintain a
vertically-integrated structure.
As to concentration within the industry, Argentina, Brazil and
Chile have not set any specific restrictions on vertical or hori-
zontal integration, while in Peru business combinations requi-
re prior authorization above certain thresholds. In Colombia,
no company may control more than 25% of the generation
On January 30, 2014, a law on interconnection derogating
from the provisions of the General Law on electricity servi-
ces was promulgated. Under the new provisions, the state
may promote interconnection projects between the northern
interconnected system (SING) and the central interconnected
system (SIC).
115
Report on operationsAnnual Report 2015 Law on the sale of electricity on the
regulated end market
Secretaría de Energía Note 4012
On June 24, 2014 the Secretaría de Energía approved Note
On January 29, 2015, an amended law was published in the
4012, which establishes the inflation rate (“MMC” index) for
official journal concerning the process of bidding to supply
EDESUR for the period between October 2013 and March
electricity to regulated market customers. Among the chan-
2014 and allows it to be offset against the corresponding debt
ges introduced by this law was the requirement that CNE be
in respect of the PUREE program for the same period, as was
more involved in these processes, the increase in the dura-
previously allowed for the period between February 2013 and
tion of public tendered contracts from three to five years, the
September 2013 by Note 6852.
inclusion of a reserve price as the maximum limit for each
bid, the possibility for the winning bidder to delay delivery in
the event of force majeure, the addition of short-term bids,
Resolution 529/2014
as well as an increase in the eligibility threshold for regulated
On May 20, 2014 the Secretaría de Energía published Reso-
market customers from 2,000 to 5,000 kW.
lution 529/2014, which updated, retroactively from February
Argentina
Resolution 32/2015
2014, the remuneration received by generation companies,
previously established by Resolution 95/2013.
In addition to raising the remuneration for fixed and variable
costs, the new resolution introduces a new item intended to
cover extraordinary maintenance costs, which will be paid
In March 2015, the Secretaría de Energía issued Resolution
through the issuance of LVFVDs (Liquidaciones de Venta con
32/2015, which establishes the introduction, starting from Fe-
Fecha de Vencimiento a Definir).
bruary 1, 2015, of a theoretical new regulatory framework that
will have no impact on the rates charged to end users. The
difference between the theoretical framework and that appli-
Brazil
cable to end users consists of a temporary additional income
component for distributors, to be set by ENRE and CAMME-
SA. The two entities are also responsible for the associated
Technical note 112/2014-SRE-ANEEL
- Revision of 2014-2018 Ampla rates
transfer of the funds. The resolution confirms that these tran-
On April 7, 2014, the regulator, ANEEL, approved technical
sfers are to be treated as payments on account in anticipation
note 112/2014-SRE-ANEEL concerning the revision of the ra-
of the general rate revision to be undertaken by ENRE in the
tes applied by electricity distributor Ampla, taking effect as
next few months.
from March 15, 2014. It ensures recognition of all capital ex-
Likewise, and starting from the same date, the resolution
penditure and operating costs incurred by the distributor. The
establishes that the funds collected through the Programa de
average increase for consumers will be equal to 2.64%, appli-
Uso Racional de la Energía Eléctrica (PUREE) be treated at a
cable starting from April 8, 2014.
true rate component for distribution companies, in recogni-
tion of the higher costs that they incur. The resolution exten-
ded the compensation under the Mecanismo de Monitoreo
de Costos and of PUREE beyond that in the situation prior to
Involuntary exposure of distributors
to the spot market
January 31, 2015, allowing the receivables accrued under the-
On March 7, 2014, the government published Decree 8.203,
se two instruments to be set off against the trade payables
which permits distributors to turn to the Conta de Desenvolvi-
due to CAMMESA. The balance will be paid in accordance
mento Energético (CDE) to cover additional costs arising from
with a payment schedule yet to be determined.
their involuntary exposure to the spot market and from ther-
The regulations require every company to submit a plan of
mal dispatching. The Brazilian regulation guarantees full cove-
investments to be made by 2015, an agreement on the use of
rage during the subsequent rate cycle.
the supplemental funds transferred (including the prohibition
Also for this purpose, on April 2, 2014, the government publi-
on the payment dividends), as well as the withdrawal of legal
shed Decree 8.221, which, as an alternative to the recovery
action for the recovery of receivables.
of additional costs through the rate cycle, envisages providing
immediate financial coverage for distributors by setting up a
new regulated environmental trading account (Conta ACR),
116
Annual Report 2015 which will be managed by the Câmara de Comercialização
that would have to be repaid over the next two years as a re-
de Energia Elétrica (CCEE). On April 28, 2014, following the
sult of rate increases to be introduced. In 2014, Brazilian distri-
receipt of bank financing, the CCEE reimbursed Ampla and
butors drew a total of 18 billion real (around €5.7 billion) on the
Coelce for a part of the higher costs incurred as a result of this
RCE account; however, they were unable to cover the entire
involuntary exposure to the spot market price and the covera-
deficit. In March 2015, a new loan through the RCE account
ge of the higher costs of transporting the electricity from the
was approved to cover the deficit for November and Decem-
generation plant.
ber 2014. The term of payment for all loans was extended to
On November 25, 2014, ANEEL approved the new ceiling and
54 months starting from November 2015.
floor on the differences settlement price (Precio de Liquidación
de las Diferencias - PLD) for 2015. The decision has genera-
ted a great deal of debate, beginning with public consultation
09/2014 and subsequently at the public hearing 54/2014.
The main effect of the new limits is that of reducing the finan-
cial impact of possible future risks associated with contractual
exposure on the spot market on distributors, as well as mitiga-
Renewable Energy
Greece
ting the irreversible risk of business and financial exposure if
The Greek incentive system uses a feed-in tariff differentia-
production falls below contractual requirements on producers.
ted by renewable energy resource. In the 2012-2014 period,
This settlement mechanism ensures that the 2014 deficit is
a range of measures were introduced to reduce the budget
offset by appropriate rates in 2015.
deficit, decreasing incentives. A new mechanism, based on
Finally, on December 10, 2014, an addendum to the conces-
premiums and tenders, should replace the current one, but
sion contract for Brazilian distributors (Ampla and Coelce) was
the timing of its introduction is not known owing to political
signed permitting the recognition of receivables associated
uncertainty.
with the 2014 deficit, ensuring their recovery through recogni-
The Wholesale Electricity Market and the Capacity Assuran-
tion of the regulated assets as part of the capital that can be
ce Mechanism (CAM) are undergoing reform.
offset at the end of the concession period, in the event it is
Under the proposed changes, the wholesale system will be
not possible to offset it during the contract period via the rate.
composed of four separate markets: the Forward Market,
Full recognition of ICMS costs
the Day-Ahead Market (the only one currently operating),
the Intra-day Market and the Balancing Market.
The CAM will be based on four pillars: capacity availability,
On March 11, 2014, ANEEL, during the 7th ordinary meeting
flexibility, strategic reserve and demand-side response. On
of its board, approved Coelce’s request to fully recognize both
December 28, 2015, the government sent its proposal for
future and past (from 2003 to 2013) sales tax (ICMS) paid to
the CAM to the European Commission. The proposal re-
generators. Recovery of the amounts through rates will take
flects the European Commission’s indication to not introdu-
place over four years, starting from April 2014.
ce retroactive payments for 2015.
On May 20, 2014, the federal public prosecutor’s office re-
quested that the adjustment of Coelce’s rates be suspended.
The action is aimed at stopping the recovery of ICMS through
Romania
the rate, as established by ANEEL, thereby limiting the rate
The main form of incentive in Romania for all renewable
increase to 13.68% (rather than 16.77%).
energy resources is the green certificates system. The only
Compensation for the effects of the
drought
exception regards hydroelectric plants with a capacity of
more than 10 MW, which are not eligible for any incentive
mechanism. Sellers are required to purchase a specified
share of renewable energy each year through the purcha-
Brazil continued to suffer from a severe drought in 2014. In
se of green certificates on the basis of annual targets set
November, the system hit its highest risk of having to ration
by law for the share of gross generation from renewables.
electricity. To cover the supplemental cost of electricity for the
Each year, the Romanian regulator publishes the mandatory
distribution companies, the government created the Regula-
share, recalculated to balance supply and demand. The value
ted Contracting Environment (RCE) account using bank loans
of the green certificates varies on the basis of coefficients
117
Report on operationsAnnual Report 2015 that differ by generation technology. More specifically, these
are 2 green certificates per MWh of generation from bio-
Germany
mass, geothermal and wind until 2017 (after 2017, 1 green
Three support mechanisms are in place:
certificate), 6 green certificates per MWh of generation from
> a feed-in tariff, applicable for plants in differing amounts
photovoltaic, and 3 green certificates per MWh of genera-
depending on the date of entry into service;
tion from hydroelectric for new plants. The price of the green
> a feed-in premium, calculated as the difference between
certificates is determined by law within a specified range
the “applicable value” (ct/kWh) for each form of renewa-
(cap & floor). Sellers are subject to penalties in the event of
ble energy and the monthly average electricity price;
non-compliance.
> auctions: to be implemented from 2017, replacing the
The ordinance EGO 57/2013 temporarily modifying the gre-
feed-in-premium.
en certificate system established the temporary suspen-
sion (from July 1, 2013 to March 31, 2017) of trade in part
of the green certificates due to renewables generators (1
Spain
green certificate per MWh for wind and mini-hydro and 2
The Spanish incentive system for renewables was mainly
green certificates per MWh for photovoltaic). Trading in the
based on feed-in tariff and feed-in premium mechanisms.
deferred green certificates could gradually resume after
The energy policies for both 2012 and 2013 mainly fo-
April 1, 2017 for photovoltaic and mini-hydro and after Ja-
cused on the need to resolve the “rate deficit” problem.
nuary 1, 2018 for wind, continuing until December 2020.
That is why, with Royal Decree Law 1/2012, the Spanish
On December 31, 2015, the government published the sha-
government suspended the pre-register procedures and eli-
re of electricity generated from renewables that will receive
minated incentive mechanisms for new renewable energy
incentives for 2016, which is now equal to 12.15%; in 2015
projects not already entered in the register. Law 15/2012
it was equal to 11.9% (Decision 1110/2014 published on De-
introduced a tax of 7% on electricity generated with any
cember 19, 2014).
Bulgaria
technology and a royalty of 22% for the use of water for
electricity generation (reduced by 90% for plants with a ca-
pacity of less than 50 MW).
In 2013, Royal Decree 2/2013 eliminated the option of remu-
The Bulgarian incentive system is mainly characterized by
neration based on the market price plus a feed-in premium,
a feed-in tariff differentiated by resource. The mechanism
leaving only the feed-in tariff option (price of energy inclu-
is open to on-shore wind plants, photovoltaic plants, hydro-
ded) or the market price, with no premium, and modified
electric plants with a capacity of less than 10 MW and bio-
the basis of the indexing used for the feed-in tariff for rene-
mass plants with a capacity of less than 5 MW.
wables and cogeneration.
Between 2012 and 2014 many regulatory changes were in-
As part of the reform of the electricity sector begun in July
troduced, including a local tax of 20% (later cancelled by
2013 through the adoption of Royal Decree Law 9/2013, on
the courts), an access fee and limitations on subsidized pro-
June 6, 2014 Royal Decree 413/2014, regulating production
duction. All of these were intended to reduce the system
from renewable energy resources, co-generation and residual
deficit created by the incentives.
waste, was approved. The decree introduces a new remu-
Turkey
neration system based on the concept of “reasonable pro-
fitability”, which is equal to the yield on 10-year government
securities plus 300 basis points. For the first regulatory pe-
The Turkish renewable energy system provides for a feed-in
riod, lasting six years starting from June 2013, the return on
tariff mechanism denominated in US dollars, guaranteed for
investment is expected to be 7.4% in real terms before taxes.
10 years, with the option of transferring to the open mar-
The new system calls for remuneration based on the sale
ket each year until 2020. If local components are used in
of electricity at the market price, to which supplemental an-
construction, the system establishes a further five years of
nual remuneration is added only in the event the market
guaranteed incentives.
118
price is not enough to ensure the established reasonable
profitability. Any supplemental remuneration is calculated
based upon the standard operating and investment costs
of an efficient, well-run company and for clusters of plants.
Annual Report 2015 These standard parameters were determined on June 20,
must pass to be considered eligible to participate in system
2014 with the approval of Ministerial Order IET/1045/2014.
adjustment services, which to date have only been open to
On July 8, 2014, Enel Green Power filed an administrati-
conventional power plants.
ve appeal of Royal Decree 413/2014 and Ministerial Order
IET/1045/2014. As to the appeal of the Royal Decree, the
action was submitted and a response from the Supreme
Portugal
Court is pending. As for the appeal of the Ministerial Or-
The rate system for wind farms is primarily based upon a
der, in 2015 additional information was requested and, once
feed-in tariff mechanism. On June 24, 2014, Decree Law
obtained, the action was filed, which is awaiting asses-
94/2014 was published in an effort to increase the capacity
sment by the court’s experts.
of existing wind farms that meet certain technical require-
Two ministerial orders were issued during 2015 that aimed
ments and have adequate wind resources. The decree law
at improving the new regulatory framework. The first order,
governs the conditions for delivering power in excess of the
IET/1344/2015, sets the standard remuneration parameters
connection capacity to the grid and the associated remu-
for certain types of solar and cogeneration facilities not
neration.
included in Ministerial Order IET/1045/2014 and therefore
Decree 102/2015 was published during the year, completing
excluded from the incentive system since July 2013. The
the regulation of the so-called “over-equipment” of wind
second order, IET/1345/2015, updates the values for the
farms under Decree Law 94/2014. This decree establishes
remuneration of cogeneration and biomass plants for the
the procedures and technical requirements for delivering
2nd half of 2015 and defines the mechanisms for reviewing
electricity generated in excess of the authorized capacity
those values to be applied in subsequent years.
to the network. The technical specifications are linked to
On July 31, 2015, Royal Decree 738/2015 was issued. It
real-time communication and the remote disconnection
establishes the regulatory framework and the dispatching
functions.
mechanism for plants located in the island territories (the
Canary Islands, Balearic Islands, Ceuta and Melilla).
On August 5, 2014, Ministerial Order IET/1459/2014 was
Morocco
published. It defined the parameters for remuneration and
Morocco is a country with a high percentage of electricity
the mechanism for assigning specific remuneration rules to
imports. In particular, since 2008 the Moroccan government
new wind and photovoltaic plants in the extra-peninsular
has been promoting strategies to increase local production
electrical systems. In addition, on September 24, 2015,
of renewable energy. Wind and solar resources are abun-
Ministerial Order IET/1953/2015 was published. It updates
dant across the country and for this reason the government
IET/1459/2014 with the aim of increasing participation in the
has mainly supported the development of renewables
mechanism for allocating incentives to wind power plants
technologies. The goal for 2020 is for 42% of electricity
for a total installed capacity of up to 450 MW.
output in the country to come from renewable resources.
In the final months of 2015 the criteria for awarding incen-
In order to manage and govern the development of rene-
tives to new renewable energy plants were defined, in line
wable resources in Morocco, the government has created
with the new regulatory framework. This voided the mora-
two institutions: ADEREE, the National Agency for the De-
torium imposed with Royal Decree Law 1/2012. The criteria,
velopment of Renewable Energy and Energy Efficiency; and
which provide for the award to be made through an auc-
MASEN, the Moroccan Agency for Solar Energy.
tion system, had already been envisaged in the new law on
The first approach to the development of renewables is ba-
electricity supply, although the details of application had not
sed on competitive auctions. The government guarantees
yet been specified. These were defined with Royal Decree
a power purchase agreement (PPA) with the single buyer
947/2015, Ministerial Decree IET/2212/2015 and the Reso-
ONEE, the national electricity sector agency. In this context,
lution of November 30 of the Secretary of Energy. The first
in 2015 the government is allocating 850 MW of wind po-
auction, scheduled for January 14, 2016, involves 500 MW
wer and has launched the first phase of competitive bidding
of wind capacity and 200 MW of biomass.
to allocate 170 MW of solar energy (the NOOR PV program
On December 19, the Resolution of December 18 of the
run by MASEN).
Secretary of Energy was published. It sets out the crite-
In addition to this first approach to renewables deve-
ria and the qualification tests that renewable energy plants
lopment, two additional approaches are also being used:
119
Report on operationsAnnual Report 2015 self-production and liberalization of high-voltage customers
In early 2015, NERSA, the national electricity regulator, ini-
provided they are supplied from renewable resources.
tiated two reviews of the rules applicable to distributed ge-
This latter system is based on opening the market for high-
neration and the use of the national grid for electricity tran-
voltage customers. Law 09/13 allows a renewable energy
sport (wheeling). The rules governing distributed generation
producer to build a new plant with the purpose of selling to
will allow all end users the option of installing photovoltaic
high-voltage customers.
systems and to export their excess power to the grid (net
Morocco intends to create a new agency called ANRE to
metering). The rules governing wheeling will permit the sale
act as an independent national energy regulator to ensure
of electricity through bilateral contracts between a private
compliance with regulations and competitiveness between
generator and end users (commercial or industrial enterpri-
operators in the electricity and gas markets, and to set pri-
ses; residential customers are not eligible). The dates for
ces and conditions of access to the transmission and inter-
completion of those reviews have not been announced of-
connection network. To this end, in 2015 the government
ficially.
began drafting a new law.
In 2015, the government endorsed Bill 58 of 2015 amending
Finally, on the basis of the long-term rate planning mecha-
some aspects of Law 09/13. The bill establishes that produ-
nism, South African electricity rates should increase by an
cers of renewable energy can also access low voltage grids.
average of 8% a year until 2018.
The specific conditions will be defined and regulated subse-
quently. The bill also regulates aspects concerning the delive-
ry of excess renewable energy to the high-voltage network.
India
South Africa
India is a federal republic composed of 29 states, each of
which has specific responsibilities in various sectors as well
as shared responsibility with the federal government in the
In May 2011, South Africa approved a target of 17.8 GW of
electricity sector.
installed renewable capacity by 2030 based upon the long-
The Ministry of New and Renewable Energy (MNRE) defi-
term energy strategy set out in the 2010-2030 Integrated
nes and implements policy for the development of renewa-
Resource Plan. The primary tool to be used in achieving this
ble energy at the national level. In addition to the Ministry,
target is the Renewable Energy Independent Power Produ-
the power market is supervised at the federal level by the
cer Procurement Programme (REIPPPP), an auction system
Central Energy Regulatory Commission (CERC), which sets
launched in 2011 that seeks to install around 13 GW in new
guidelines and standard rates, and by the State Energy Re-
renewable capacity between 2014 and 2020 (hydroelectric
gulatory Commissions (SERC), which implement them at
<40 MW, concentrated solar and photovoltaic, wind, bio-
the state level.
mass, biogas and landfill gas power). Currently, five rounds
In June 2015 the government headed by Prime Minister Na-
(bid windows) are scheduled, four of which have already
rendra Modi approved a target of 175 GW of renewables
been held, with the award of more than 5,000 MW of ca-
capacity by 2022, including 100 GW from solar, about 60
pacity. In 2015 an additional round – called the Expedited
GW from wind and about 10 GW from other technologies.
Round, or Round 4.5 – was added and held for an additional
The renewables industry is characterized by a high degree
1,800 MW, which have not yet been assigned.
of fragmentation, as each state has introduced its own re-
After a pre-qualification phase, which is concerned with
gulatory system for the development of new capacity. In
technical and financial issues, qualified projects are chosen
general, the main support mechanisms for the development
based upon two criteria: the bid price (weighted 70%) and
of wind and solar are:
the economic development content of the project (weighted
> federal and state auctions (solar);
30%). The latter is based upon a series of parameters focu-
> feed-in tariffs at the state level (wind);
sing on the economic development of the country, including
> generation-based incentives at the federal level (wind);
local content and the creation of jobs for South Africans,
> Renewable Energy Certificates (REC) based on state-level
especially non-whites.
Renewable Portfolio Obligations (RPO) (wind and solar);
The winners will be invited to enter into a 20-year PPA with
> specific tax incentives.
the national utility, Eskom, with payments guaranteed by
The most widely adopted incentive plan for wind power is
the government.
based on Preferred Feed-In Tariffs, defined by the SERC at
120
Annual Report 2015 the state level and implemented through PPAs with state
of major hydroelectric plants, although in the last few years a
distribution companies with terms varying between 10 and
gradual diversification has been under way. The main remu-
25 years depending on the state.
nerative approach involves long-term power purchase agree-
As concerns developing the solar energy sector, in 2010 a
ments (PPAs), tax incentives and facilitated transport rates.
federal program called the Jawaharlal Nehru National So-
lar Mission (JNNSM) was launched, based on an auction
system managed at the federal level but implemented at
Brazil
the state level. The program is structured into three phases,
The incentive system for renewable energy in Brazil was
of which the second is currently under way. The winning
created in 2002 with the implementation of a feed-in me-
bidders are awarded a 25-year PPA at a fixed rate with the
chanism (PROINFA), and was then harmonized with the
National Thermal Power Corporation (NTPC), the leading na-
sales system for conventional power using competitive
tional electricity company.
auctions. The system envisages different types of auction
Kenya
depending on whether participation is reserved to new
plants or existing plants and primarily comprise:
> Leilão Fontes Alternativas, reserved to renewable wind,
While Kenya has not set official installed capacity targets for
biomass and hydroelectric technologies up to 50 MW;
renewable energy, it strongly supports their development,
> Leilão Energia de Reserva, for which all projects that will
mainly in order to reduce its dependence on hydroelectric
enter operation within three years of the date on which
power, seeking to attract private investors.
the auction is held are eligible. These auctions are normal-
The main incentive mechanism for renewables, in use sin-
ly organized to increase reserve capacity and/or promote
ce 2008 and revised in 2012, is the feed-in tariff system
the development of certain technologies (such as rene-
(FiT), with a specified value determined by law by the Ener-
wables);
gy Regulatory Commission (ERC) for plants with a capacity
> Leilão de Energia Nova, for which all projects that will
of less than 10 MW and by auction for larger facilities. The
enter operation more than three years after the date on
support mechanism provides for 20-year power purchase
which the auction is held are eligible. These auctions are
agreements (PPA) with Kenya Power and Lighting Company
divided into A-3 and A-5 auctions on the basis of the ge-
(KPLC), the national operator in charge of transmission, di-
nerator’s obligation to supply the energy awarded after
stribution and supply of end users. Rates are differentiated
three or five years.
by technology (wind, biomass, solar, mini-hydro and geo-
An auction typically has two phases: the descending-clock
thermal) and size of the plant. They are partly indexed to US
phase in which the auction organizer establishes the ope-
inflation (US CPI).
ning price for the auction and the generators submit de-
In 2012 a ceiling was set for the maximum capacity of re-
creasing bids; and the pay-as-bid phase in which the remai-
newables plants that could be built with a FiT contract. The
ning generators further reduce the price until the supply of
FiT support mechanism is reviewed every three years, in-
power covers all the demand up for auction. The winning
cluding a revision of rates. The new measures only apply to
bidders are granted long-term contracts whose term varies
new plants, however.
by resource: 15 years for thermal biomass plants, 20 years
The country has a rate of electrification of just 23%, making
for wind plants, 25 years for solar plants and 30 years for
an increase in the rate of rural electrification through the
hydroelectric plants.
extension and increasing the density of the national grid,
During 2015, eight auctions were held for the supply of re-
the development of mini-grids and off-grid projects a major
gulated customers, of which five involved the participation
priority.
Latin America
of renewables projects. Contracts for a total of about 5.5
GW in new capacity were awarded. In November, the fe-
deral government also held an auction for the reallocation
of about 6 GW of expiring hydroelectric concessions, with
30-year contracts that provide for remuneration of operating
The development of renewable energy resources in Latin
costs for 70% of the capacity and the possibility of alloca-
America is less diversified than in Europe. In particular, the ter-
ting the remaining 30% on the free market.
ritory has historically had electric matrixes with a large number
In September, the Ministry approved a decree that will al-
121
Report on operationsAnnual Report 2015 low wind turbines that have been operational for at least
be installed between 2014-2025 be supplied by renewable
24 months and have undergone technical alterations du-
power plants.
ring project development to recalculate the value of their
On January 29, 2015, Law 20.805 was approved, introdu-
“Garantia Física”, i.e. the maximum capacity with which a
cing changes to the system of auctions for the supply of
system can participate in an auction to supply regulated
customers on the regulated market. The primary changes
customers. Under the approved methodology, plants that
involve increasing the term of the contract (from 15 to 20
record a positive differential can sell it through A-0 and A-1
years), as well as the range within which customers are allo-
auctions or to free-market customers.
wed to remain within the regulated market (from a range of
In December, Law 13.203 was approved. Among other
0.5-2 MW to a range of 0.5-5 MW), introducing short-term
changes, it introduced a new mechanism for managing the
auctions and, finally, offering new plants the option of delay-
hydrological risk, which allows hydroelectric generators the
ing the date at which they are to begin supplying electricity.
option of transferring that risk to end users in exchange for
The new rules will be in effect for all contracts signed as a
a price reduction in contracts signed. It also increased, from
result of auctions organized as from 2016.
30 MW to 300 MW, the threshold for renewables plants to
In April 2015, the Ministry published the decree approving
benefit from tax incentives and allows plants that won in
the Plan for the Expansion of the National Electrical System
previous auctions to participate with any surplus capacity in
for 2014-2015. The plan include the construction of an in-
future auctions for the supply of regulated customers.
terconnection between the country’s two main electrical
Chile
systems (SIC and SING), which should enter service by the
end of 2019.
In September 2015 the document “Hoja de Ruta al 2050:
Chile has a system mandating achievement of specified re-
Hacia una Energía Sustentable e Inclusiva” was published,
newable energy targets for those who withdraw power for
defining guidelines for the long-term evolution of the ener-
sale through distributors or sales companies. The law sets
gy industry in Chile and setting a number of industry tar-
two different targets based upon the date the contract is
gets. The document constitutes one of the foundations of
signed:
the energy policy to be developed by the Energy Ministry
> for all power under contract between August 31, 2007
and introduces, among other things, the goal of generating
and June 30, 2013, renewable resources are to account
70% of power from renewable resources by 2050, most of
for 5% of the electricity starting from 2014, an amount
which should be obtained by using wind and solar capacity.
that will increase by 0.5 points per year to reach a share
of 10% by 2024;
> for all contracts signed starting from July 1, 2013, Law
Colombia
20698 of 2013 sets a target of 20% by 2025 to be achie-
On May 14, 2014 the President of Colombia promulgated
ved by gradually raising the initial share of 6% in 2014.
Law 1715 concerning the promotion of electricity genera-
All renewable energy resources are eligible for the purpo-
tion from renewable resources, the reduction of greenhou-
ses of meeting the requirement. For hydroelectric plants
se gas emissions and ensuring the country’s energy secu-
with a capacity of up to 40 MW, the system provides for
rity. In addition to introducing a variety of tax incentives for
a corrective factor which counts all of the first 20 MW and
renewable resources, the law provides for the creation of
a declining proportion of the capacity between 20 and 40
a fund to finance non-conventional renewables plants and
MW. The mechanism also establishes penalties for failure
energy efficiency initiatives.
to achieve the mandatory share.
In 2015, the drafting of second level legislation continued,
In May 2014, the country’s new Energy Agenda was pre-
with the approval of a decree formalizing the tax incentives
sented by President Michelle Bachelet, setting out the
envisaged in the law for renewables plants. More specifi-
primary energy policy targets, the next regulatory steps to
cally, such plants will be exempt from VAT and duties and
be taken and laying out the plans of investments that the
benefit from accelerated depreciation and a 50% tax de-
government intends to make in its next term. Specifically,
duction.
with regard to renewables, the Agenda confirms the tar-
In February 2016, the Ministry of Mines and Energy pu-
get of cutting energy consumption by 20% by 2025 and
blished the new plan for the 2015-2029 period (“Plan de
introduces an additional target that 45% of new capacity to
Expansión de Referencia Generación - Transmisión 2015-
122
Annual Report 2015 2029”), officially beginning the construction of the connec-
June the Ministry of Energy (SENER) presented the electri-
tion of the peninsula of La Guajira to the national electrical
city sector planning document for 2015-2029 (PRODESEN).
system, which should enter service by the end of 2022.
The document sets out to identify the electricity generation,
The area, in the north of the country, is currently isolated
transmission and distribution projects necessary to meet
but is one of the areas of greatest wind potential in Colom-
demand over the period. According to ministry estimates,
bia. In the coming months, the final design of the project
demand is expected to rise by between 3% and 4%, which
will be completed, setting out the detailed timetable for
will require about 60 GW of additional capacity, of which
construction, so as to take account of the development
about 32 GW of renewables capacity in order to meet the
plans of local generators.
target of 35% of generation from renewables by 2024.
Mexico
Finally, in December the Energy Industry Transition Act was
approved, defining and formalizing the medium and long-
term objectives for the incorporation of generation from
The year 2015 saw the progressive approval and publica-
non-fossil resources into the electricity system (25% by
tion of a series of laws and regulations to restructure the
2018, 30% by 2021 and 35% by 2024).
energy and oil sector. With specific regard to the electricity
industry, the legislative process, which began with consti-
tutional amendments approved in December 2013 and con-
Peru
tinued in 2014 with the enactment of the legal framework
The Peruvian renewables incentive system, introduced with
for the electricity industry (Ley de la Industria Eléctrica, Ley
Legislative Decree 1002 of 2008 (Decreto Legislativo de
de Energía Geotérmica and Ley de la Comisión Federal de
Promoción de la Inversión para la Generación de Electrici-
Electricidad), culminated in 2015 with the publication of the
dad), is a system of competitive auctions open to all rene-
Electricity Market Guidelines.
wable generation technologies (with the sole exception of
The document, published in September, describes the rules
hydroelectric plants, which are eligible up to a limit of 20
governing the operation and organization of, as well as the
MW), usually differentiated by resource at the time of the
criteria for participation in, the new market. The system pro-
publication of the associated decree by the Ministry.
vides for mechanisms for short and long-term transactions
The auctions provide for a maximum bid price and a pay-as-bid
in electricity, capacity and “clean energy” certificates, inclu-
mechanism. The winning renewables plants also benefit from
ding a real-time market, a day-ahead market and auctions
dispatching priority and a variety of tax incentives, including ac-
for the supply of customers in the regulated market.
celerated amortization and early reimbursement of sales taxes.
On the basis of the announced calendar, as from January
In December, the fourth renewables auction was held as
27, 2016, operators can participate in the wholesale market,
part of the effort to achieve the 5% target introduced with
while the first long-term auction will be held in March 2016,
the 2008 law. The winning bidders will sign 20-year con-
at which distributors can purchase the power and certifica-
tracts to supply electricity from wind, photovoltaic, mini-
tes necessary to achieve the target of 25% of generation
hydro and biomass resources totaling about 2.2 TWh a year,
from non-fossil resources by 2018. January 27, 2016 also
with supply to begin in January 2018. The winners will be
saw the launch of the real-time wholesale market.
announced in February or March 2016.
In January, the Ministry also initiated the unbundling of the
As regards legislation governing the development of gene-
former market monopolist (Comisión Federal de Electricidad
ration, in February 2015, the regulator OSINERGMIN appro-
- CFE) with the publication of the associated decree. That
ved the new calculation method for Energía Firme, which in
process, which should be completed by the end of 2017,
the case of renewables plants will be defined on the basis
envisages horizontal and vertical separation and will lead to
of the production function, distinguishing between plants in
the creation of at least four generation companies, two grid
operation, new plants and winners of a renewables auction.
operations companies (transmission and distribution), two
sales companies (for customers in the free and regulated
markets) and two branches to manage commercial relations
Panama
with generators who opt to maintain the pre-reform market
Renewable energy is primarily sold through public auctions
arrangements (independent producers and self-generators).
organized by distributors and bilateral power purchase agre-
As regards the long-term development of the sector, in
ements reached on the free market.
123
Report on operationsAnnual Report 2015 In February 2015, the Congress approved Law 25, which
> introducing a comprehensive planning approach for the
authorizes the creation of the Ministry of the Environment.
energy system that considers economic, technical, so-
The new ministry will be charged with contributing to the
cial and environmental aspects as pillars of the system.
implementation of environmental policies in collaboration
with other ministries and with implementing national deve-
lopment projects.
Uruguay
In May 2015 Resolution 8566 was approved. It changes
The country’s energy policy is guided by the 2005-2030 Na-
the methodology for the export of electricity during periods
tional Energy Policy, approved by the government in order
of abundant water availability. The new rule proposed by
to reduced Uruguay’s energy dependency and encourage
the operator of the Panamanian system, Centro Nacional
investment in the energy industry. The policy sets out a se-
de Despacho, would reduce the risk of reservoir overflow.
ries of short, medium and long-term objectives, including a
Guatemala
goal of achieving 15% of generation from non-conventional
renewables by 2015 (the target was achieved).
As regards market access, private operators can participate
Renewable energy is primarily sold through public auctions
in auctions called by the government, normally differentia-
organized by distributors/traders and bilateral power purcha-
ted by generation technology, for the award of long-term
se agreements on the free market. The country also has
contracts for the sale of electricity to the national distributor
a system of tax incentives, including a 10-year exemption
UTE.
from income tax and an exemption from taxes in the import
of materials and equipment for renewables plants.
In January 2015 the regulator, CNEE, announced that in
United States
2014 the country had reached 65% of generation from re-
The United States has a two-level renewables incentive sy-
newable resources, an increase of about 15% compared
stem. The federal level envisages various types of support,
with 2007, the year in which the government approved
including tax incentives for production and investment (the
the country’s long-term targets for renewables generation.
production tax credit - PTC and the investment tax credit
More specifically, the numbers confirmed that the country
- ITC), accelerated depreciation and federal subsidies. At
had achieved the target of 60% set for 2015 and was on
the state level, the main incentive is a Renewable Portfo-
the way to achieving the subsequent target (80% by 2026).
lio Standard (RPS) mechanism, i.e. a system of mandato-
Costa Rica
ry percentages of generation from renewables for utilities,
with targets differing from state to state. Most states have
adopted systems of tradable certificates but there is no cor-
Renewable energy is primarily sold through IPPs (≤20 MW)
responding platform active at the federal level.
with rates set by the regulator (ARESEP) and BOT public auc-
The production tax credit (PTC), the tax incentive to encou-
tions (≤50 MW) with prices set for long-term PPAs with ICE.
rage renewable electricity generation from wind, geother-
In September 2015, the President signed the “Plan Nacio-
mal, hydroelectric and biomass plans, which expired at the
nal de Energía 2015-2030”, which sets out short, medium
end of 2015, while the investment tax credit (ITC), the tax
and long-term objectives for energy sector planning. For
incentive for solar energy, which is expiring at the end of
the electricity industry, four objectives have been defined
2016, were both recently renewed.
and will be addressed by specific measures in the coming
The wind PTC is granted in an amount equal to:
years:
> 100% if construction begins before January 1, 2017;
> improving energy efficiency through a reduction of ener-
> 80% if construction begins after December 31, 2016 and
gy intensity and emissions associated with energy con-
before January 1, 2018;
sumption;
> 60% if construction begins after December 31, 2017 and
> ensuring optimal distributed generation, allowing the di-
before January 1, 2019;
rect use of renewable resources;
> 40% if construction begins after December 31, 2018 and
> optimizing the country’s generation matrix by assessing
before January 1, 2020.
the available resources and their combination in terms of
The solar ITC is granted in an amount equal to:
quality, availability and price;
> 30% if construction begins before January 1, 2020;
124
Annual Report 2015 > 26% if construction begins after December 31, 2019 and
before January 1, 2021;
> 22% if construction begins after December 31, 2020 and
before January 1, 2022.
Finally, the geothermal, hydroelectric and biomass PTC is
granted in an amount equal to 100% if construction begins
before January 1, 2017, establishing a two-year extension
with no period of gradual elimination of the incentive.
Additional guidance on the definition of “construction be-
gins” and “continuous efforts” required for eligibility is ex-
pected to be issued by the Internal Revenue Service in the
1st and 2nd Quarters of 2016.
In August 2015, the Environmental Protection Agency (EPA)
announced the Clean Power Plan for cutting emissions by
32% by 2030 and established a specific reduction target for
each state. However, on February 9, 2016, the US Supreme
Court ordered the suspension of the measure while fede-
ral courts are examining the issue. The validity of the EPA’s
deadlines for the states now hangs on the outcome of the
legal proceedings. Previously, each state had to present an
appropriate reduction plan to the EPA by 2016.
States will need to start cutting emissions by 2022, with an
incentive system in place starting in 2020.
125
Report on operationsAnnual Report 2015 Main risks and uncertainties
Due to the nature of its business, the Group is exposed to
In order to mitigate its exposure to these risks, the Group
a variety of risks, notably market risks, credit risk, liquidity
conducts specific analysis, monitoring, management and
risk, industrial and environmental risks and regulatory risk.
control activities, as described in this section.
Risks connected with market liberalization
and regulatory developments
The energy markets in which the Group operates are cur-
tion mix, improving the competitiveness of plants through
rently undergoing gradual liberalization, which is being im-
cost leadership, seeking out new high-potential markets and
plemented using different approaches and timetables from
developing renewable energy resources with appropriate in-
country to country.
vestment plans in a variety of countries.
As a result of these processes, the Group is exposed to
The Group often operates in regulated markets or regulated
increasing competition from new entrants and the deve-
regimes, and changes in the rules governing operations in
lopment of organized markets.
such markets and regimes, and the associated instructions
The business risks generated by the natural participation of
and requirements with which the Group must comply, can
the Group in such markets have been addressed by integra-
impact our operations and performance.
ting along the value chain, with a greater drive for technolo-
In order to mitigate the risks that such factors can engender,
gical innovation, diversification and geographical expansion.
Enel has forged closer relationships with local government
More specifically, the initiatives taken have increased the
and regulatory bodies, adopting a transparent, collaborative
customer base in the free market, with the aim of integra-
and proactive approach in tackling and eliminating sources of
ting downstream into final markets, optimizing the genera-
instability in regulatory arrangements.
Risks connected with CO2 emissions
In addition to being one of the factors with the largest po-
tential impact on Group operations, emissions of carbon dio-
gate the risk factors associated with CO2 regulations, the
Group monitors the development and implementation of EU
xide (CO2) are also one of the greatest challenges facing the
Group in safeguarding the environment.
and Italian legislation, diversifies its generation mix towards
the use of low-carbon technologies and resources, with a
EU legislation governing the emissions trading scheme im-
focus on renewables and nuclear power, develops strategies
poses costs for the electricity industry, costs that could rise
to acquire allowances at competitive prices and, above all,
substantially in the future. In this context, the instability of
enhances the environmental performance of its generation
the emissions allowance market accentuates the difficulties
plants, increasing their energy efficiency.
of managing and monitoring the situation. In order to miti-
126
Annual Report 2015 Market risks
As part of its operations, Enel is exposed to a variety of
control processes, ensuring compliance with the principle of
market risks, notably the risk of changes in interest rates,
organizational separation of units responsible for operations
exchange rates and commodity prices.
and those in charge of managing risk.
The financial risk governance system also defines a system
The financial risk governance arrangements adopted by the
of operating limits at the Group and individual Region/Count-
Group establish specific internal committees responsible
ry/global business line levels for the various types of risk,
for policy setting and supervision of risk management, as
which are monitored periodically by risk management units.
well as specific policies at the Group and individual Region/
To maintain market risk within the limits set out in the
Country/global business line levels that establish the roles
Group’s risk management policies, Enel uses derivatives
and responsibilities for risk management, monitoring and
obtained in the market.
Risks connected with commodity prices and supply
continuity
Given the nature of its business, Enel is exposed to changes
risk, the specification of a ceiling for maximum acceptable
in the prices of fuel and electricity, which can have a signifi-
risk and the implementation of a hedging strategy using de-
cant impact on its results.
rivatives on regulated or over-the-counter (OTC) markets.
To mitigate this exposure, the Group has developed a stra-
For a more detailed examination of commodity risk manage-
tegy of stabilizing margins by contracting for supplies of fuel
ment and the outstanding derivatives portfolio, please see
and the delivery of electricity to end users or wholesalers in
note 41 of the consolidated financial statements.
advance.
In order to limit the risk of interruptions in fuel supplies, the
The Group has also implemented a formal procedure that
Group has diversified fuel sources, using suppliers from dif-
provides for the measurement of the residual commodity
ferent geographical areas.
Exchange risk
The Group is exposed to the risk that changes in the exchan-
other than the currency of account or functional currency
ge rates between the euro and the main other currencies
of the company holding the liability;
could give rise to adverse changes in the euro value of per-
> financial assets/liabilities measured at fair value.
formance and financial aggregates denominated in foreign
The consolidated financial statements are also exposed to
currencies, given the Group’s geographical diversification
the exchange risk associated with the consolidation values
and the access to international markets connected with the
of equity investments denominated in currencies other than
issue of debt instruments and transactions in commodities.
the euro (translation risk).
Accordingly, the exposure to exchange risk, which is mainly
The policy for managing exchange risk is designed to ensure
denominated in US dollars, is attributable to:
the systematic hedging of exposures, with the exclusion of
> cash flows in respect of the purchase or sale of fuel or
translation risk, through operational processes that ensure
electricity;
the implementation of appropriate hedging strategies, which
> cash flows in respect of investments in foreign currency,
typically involve the use of financial derivatives on over-the-
dividends from foreign subsidiaries or the purchase or
counter (OTC) markets.
sale of equity investments;
For more details, please see note 41 of the consolidated
> financial liabilities assumed by the holding company or
financial statements.
the individual subsidiaries denominated in currencies
127
Report on operationsAnnual Report 2015 Interest rate risk
The Group is exposed to the risk that changes in interest
le established within the framework of the formal risk gover-
rates could give rise to increases in net financial expense or
nance procedures of the Group, curbing funding costs over
adverse changes in the value of assets/liabilities measured
time and limiting the volatility of results. This goal is also
at fair value.
pursued through the use of financial instruments on over-
The main source of exposure to interest rate risk is the varia-
the-counter markets.
bility of financial terms in the case of new debt or fluctuation
For more details, please see note 41 of the consolidated
in the interest flows associated with floating-rate debt.
financial statements.
The risk management policy seeks to maintain the risk profi-
Credit risk
The Group’s commercial, commodity and financial opera-
Country/global business line level and at the consolidated
tions expose it to credit risk, i.e. the possibility that an unex-
level.
pected change in the creditworthiness of a counterparty
could impact the creditor position, in terms of insolvency
As part of the management of credit risk even more effec-
(default risk) or changes in its market value (spread risk).
tively, for a number of years the Group has carried out non-
Beginning in the last few years, with the instability and
recourse assignments of receivables for specific segments
uncertainty of the financial markets and the global econo-
of the commercial portfolio. Partly in view of the macroeco-
mic crisis, average payment times for trade receivables by
nomic environment, as from 2011 the use of assignments
counterparties have increased. In this general environment,
was extended both geographically and to invoiced receiva-
in order to minimize credit risk, the credit risk management
bles and receivables to be invoiced of companies operating
policy calls for the preliminary assessment of the credit-
in other segments of the electricity industry than retail sales
worthiness of counterparties in the main portfolios and the
(such as, for example, receivables from generation activities,
use of risk mitigation techniques, such as the acquisition
sales of electricity as part of energy management opera-
of secured or unsecured guarantees and, for financial and
tions, the sale of green certificates or electricity transport
commodities transactions in particular, standard contractual
services).
frameworks.
All of the above transactions are considered as non-recourse
In addition, the general Group policy provides for application
transactions for accounting purposes and therefore involved
of uniform criteria in all the main Regions/Countries/global
the full derecognition of the corresponding assigned assets
business lines for monitoring and controlling credit risk in
from the balance sheet, as the risks and rewards associated
order to promptly identify any deterioration in credit quality
with them have been transferred.
and determine any mitigation actions to implement.
As regards credit risk in respect of commodities transac-
tions, credit risk limits specified by the competent units of
the Region/Country/global business line involved are applied.
As to credit risk in respect of financial transactions, including
those involving derivatives, risk is minimized by selecting
counterparties with high credit ratings from among leading
Italian and international financial institutions, portfolio diver-
sification, entering into margin agreements for the exchan-
ge of cash collateral, or the use of netting arrangements. In
2015, operating limits on credit risk approved by the Group
Risk Committee were again applied and monitored, using
an internal valuation system, at both the individual Region/
128
Annual Report 2015 Liquidity risk
the expansionary monetary policies of the European Central
Bank (ECB) and low oil prices, the European economy was
Liquidity risk is the risk that the Group, while solvent, would
sluggish and still far from its pre-crisis levels, a crisis worse-
not be able to discharge its obligations in a timely manner
ned by the unresolved Greek impasse. Growth prospects for
or would only be able to do so on unfavorable terms owing
all of Europe are still held back by an environment uncondu-
to situations of tension or systemic crises (credit crunches,
cive to investment and by high unemployment. By contrast,
sovereign debt crises, etc.) or changes in the perception of
the United States recorded strong economic performance,
Group riskiness by the market.
surpassing its pre-crisis levels due to higher levels of dome-
The Group’s risk management policies are designed to main-
stic demand and consumption and the revival of the services
tain a level of liquidity sufficient to meet its obligations over a
sector thanks to the massive monetary policy intervention
specified time horizon without having recourse to additional
by the Federal Reserve (Fed). Unemployment figures remain
sources of financing as well as to maintain a prudential liquidity
very positive as is core inflation, which is close to the Fed’s
buffer sufficient to meet unexpected obligations. In addition, in
target level, while headline inflation (including the more vo-
order to ensure that the Group can discharge its medium and
latile components such as energy) is still far from the target
long-term commitments, Enel pursues a borrowing strategy
and it is difficult to discern a clear trend towards recovery.
that provides for a diversified structure of financing sources to
The recovery in private consumption, sustained by the im-
which it can turn and a balanced maturity profile.
provement in the labor market, however, has been accompa-
Rating risk
Credit ratings, which are assigned by rating agencies, impact
the possibility of a company to access the various sources of
financing and the associated cost of that financing. Any re-
duction in the rating could limit access to the capital market
and increase finance costs, with a negative impact on the
performance and financial situation of the company.
In the first half of 2015, Standard & Poor’s and Moody’s re-
vised their outlooks for Enel upwards, bringing them from
stable to positive and from negative to stable, respecti-
vely, mainly owing to the resilience the Group has shown
in tackling adverse market conditions (the slowdown in the
economy and the fall in commodity prices) and changes in
the regulatory systems of the markets in which it operates,
thanks to the flexibility of the range of strategic options avai-
lable to the Group, such as asset disposals, containment of
operating costs and optimization of the debt exposure.
Accordingly, at the end of the year Enel’s rating was: (i)
“BBB” for Standard & Poor’s with a positive outlook; (ii)
“BBB+”, with a stable outlook for Fitch; and (iii) “Baa2”, with
a stable outlook for Moody’s.
Country risk
nied by less than exuberant performance in manufacturing
and industry in general as well as a deterioration in the trade
balance. The latter was affected by the strong appreciation
of the dollar (which has helped buoy demand for imports of
consumer goods and made goods with prices denominated
in dollars less competitive) as a result of divergent expecta-
tions (initially more restrictive, but later attenuating) in the
financial markets concerning the monetary policy stance of
the US central bank. Another factor was the decline in global
demand, which was exacerbated in particular by the econo-
mic slowdown in China. Last year China’s role as the driver
of growth grew increasingly shaky after ensuring outstan-
ding economic performance for more than a decade, led pri-
marily by exports and high levels of domestic investment.
The real challenge facing policy makers will be to revive
growth through the development of an internal market and
the rise of the services sector. The situation in other large
emerging countries differs considerably: on one hand, the
Indian economy, thanks to the central bank’s monetary poli-
cies, seems poised for a strong recovery, while on the other,
Brazil is struggling with record levels of inflation, a series of
mistaken policy decisions and internal scandals. Once again
the Russian economy is trending downwards in the wake of
the geopolitical tensions with Ukraine and, especially, low
oil prices, which have tipped the country into recession with
double-digit inflation. Concern remains high in the Middle
East and North Africa in response to developments in Sy-
ria and Libya, respectively, which present risks that could
In 2015 growth performance differed sharply between OECD
trigger a lasting alteration of regional and global balances,
and non-OECD countries. Despite benefiting from a highly fa-
and massive refugee flows and the attendant uncertainties,
vorable international macroeconomic environment thanks to
which could impact the overall macroeconomic situation.
129
Report on operationsAnnual Report 2015 Industrial and
environmental risks
ctions in the storage, movement, transport and treatment
of nuclear substances and materials. In the countries where
Enel has nuclear operations, specific laws based on interna-
tional conventions require operators to obtain insurance co-
Industrial and environmental risks are managed by the
verage for liability for risks associated with the use and tran-
Global Generation business line using statistical modeling
sport of nuclear fuel, with coverage ceilings and other terms
techniques, which assess risks in probabilistic and moneta-
and conditions set by law. Other mitigating measures have
ry terms for each plant/grid/project. In addition to typically
been taken in accordance with international best practice.
industrial risk models (business interruption, operation and
maintenance), Enel has developed models to measure di-
saster risks linked to seismic events, a model for assessing
fire risks and environmental models to assess the exposure
of each plant to risks involving all possible segments of the
environment, such as the air, water, land and underground.
All of this is done with the objective of identifying the most
critical areas and preparing appropriate instruments to safe-
guard the industrial value of plants.
Breakdowns or accidents that temporarily interrupt opera-
tions at Enel’s plants represent an additional risk associated
with the Group’s business.
In addition, we also conducted exercises to assess risks
associated with the operation of the distribution networks
managed by the Infrastructure and Networks business line.
In order to mitigate such risks, the Group adopts leading
prevention and protection strategies, including preventive
and predictive maintenance techniques and technology sur-
veys to identify and control risks. In the environmental area,
plants undergo certification under international standards
(ISO 14001 and EMAS) and the use of environmental mana-
gement systems to monitor potential sources of risk in order
to identify any threats promptly.
The Group also uses the Mapping of Environmental Com-
pliance approach (MAPEC), which with regard to the ope-
ration of electricity generation and distribution systems
(excluding nuclear plants) makes it possible to identify envi-
ronmental risks to the strategy and reputation of the organi-
zation and to the environment itself.
Any residual industrial and environmental risk is managed
using specific insurance policies to protect corporate assets
and provide liability coverage in the event of harm caused to
third parties by accidents, including pollution, that may occur
during the production and distribution of electricity and gas.
With regard to nuclear power generation, Enel operates in
Slovakia through Slovenské elektrárne and in Spain throu-
gh Endesa. In relation to its nuclear activities, the Group is
exposed to operational risk and may face additional costs
because of, inter alia, accidents, safety violations, acts of ter-
rorism, natural disasters, equipment malfunctions, malfun-
130
Annual Report 2015 Outlook
The strategic plan, presented in November 2015, is focused
Group more closely with the sector average.
closely on long-term industrial growth, especially in renewa-
In 2016, the full integration of Enel Green Power and the
bles and networks. It sets out an ambitious program for en-
corporate reorganization in Latin America will be completed.
hancing efficiency through the reduction of maintenance and
The year will also see the launch of the smart meter installa-
operating costs in all global business lines.
tion campaign and the development of the strategic plan of
The plan also envisages the simplification of the Enel
Enel Open Fiber.
Group’s corporate structure, which began in 2014 with the
separation of the two subsidiaries Endesa and Enersis. It
Based on the key pillars outlined above, the following table
also seeks to manage the Enel asset portfolio actively with a
sets out the performance and financial targets on which the
view to creating value through the strategic repositioning of
2016-2019 strategic plan is founded, aiming to boost cash ge-
the Group. Finally, it provides for focusing growing attention
neration to support the increase in dividends to the benefit of
on shareholder remuneration, thanks to a gradual increase in
shareholders.
dividends distributed through 2019 in order to align the Enel
Recurring EBITDA
Net ordinary income
Minimum dividend
Pay-out
FFO/Net financial debt
billions of euros
billions of euros
euro/share
%
%
2016
~14.7
~3.1
0.18
55
23
2017
CAGR 2015-2019
~15.5
~3.4
60
26
~4%
~10%
~17%
~6%
The Enel strategic plan is a synthesis of the long-term vision
dialogue with the communities in which the Group operates;
of the Company: a new strategic direction called “Open Po-
openness within the Group, which means leveraging the ta-
wer”, which represents a new approach involving all of the
lents and diversity among our people; and finally, openness as
Group’s industrial processes and commercial initiatives, gui-
the capacity to listen to the world around us and to seize the
ding investments and the relationship with stakeholders. It is
opportunities and meet the needs we find.
in fact based on the concept of openness in terms of sustai-
Consistent with this innovative approach, on January 26, 2016
nability and, hence, innovation and technological innovation at
Enel presented the new Group logo, a global brand that repre-
a time when the Enel Group is opening its infrastructure to a
sents openness to change, listening and innovation.
variety of other uses: openness with stakeholders, through
131
Report on operationsAnnual Report 2015 Other information
Non-EU subsidiaries
At the date of approval by the Board of Directors of the finan-
Enersis Group); 15) Endesa Brasil SA (a Brazilian company
cial statements of Enel SpA for 2015 – March 22, 2016 – the
belonging to the Enersis Group); 16) Enel Brasil Partici-
Enel Group meets the “conditions for the listing of shares of
pações Ltda (a Brazilian company belonging to the Enel
companies with control over companies established and re-
Green Power Group); 17) Enel Fortuna SA (a Panamanian
gulated under the law of non-EU countries” (hereinafter “non-
company belonging to the Enel Green Power Group); 18)
EU subsidiaries”) established by CONSOB with Article 36 of
Enel Green Power Chile Ltda (a Chilean company belon-
the Market Rules (approved with Resolution 16530 of June
ging to the Enel Green Power Group); 19) Enel Green Po-
25, 2008, as amended).
Specifically, we report that:
wer North America Inc. (a US company belonging to the
Enel Green Power Group); 20) Enel Green Power North
> in application of the materiality criteria for the purposes
America Development LLC (a US company belonging to
of consolidation provided for in Article 36, paragraph 2,
the Enel Green Power Group); 21) Enel Kansas LLC (a US
of the CONSOB Market Rules, 23 non-EU subsidiaries of
company belonging to the Enel Green Power Group); 22)
the Enel Group have been identified to which the rules in
Enersis SA (a Chilean company); and 23) PJSC Enel Rus-
question apply on the basis of the consolidated accounts
sia (a Russian subsidiary of Enel Investment Holding BV);
of the Enel Group at December 31, 2014.
> the balance sheet and income statement for the 2015 fi-
They are: 1) Ampla Energia e Serviços SA (a Brazilian com-
nancial statements of the above companies included in
pany belonging to the Enersis Group); 2) Buffalo Dunes
the reporting package used for the purpose of preparing
Wind Project LLC (a US company belonging to the Enel
the consolidated financial statements of the Enel Group
Green Power Group); 3) Chilectra SA (a Chilean company
will be made available to the public by Enel SpA (pursuant
belonging to the Enersis Group); 4) Compañía Distribui-
to Article 36, paragraph 1a) of the CONSOB Market Ru-
dora y Comercializadora de Energía - Codensa SA ESP (a
les) at least 15 days prior to the day scheduled for the Or-
Colombian company belonging to the Enersis Group); 5)
dinary Shareholders’ Meeting called to approve the 2015
Companhia de Interconexão Energética SA - CIEN (a Bra-
financial statements of Enel SpA together with the sum-
zilian company belonging to the Enersis Group); 6) Com-
mary statements showing the essential data of the latest
pañía Eléctrica do Tarapacá SA - Celta (a Chilean company
annual financial statements of subsidiaries and associa-
belonging to the Enersis Group); 7) Companhia Energéti-
ted companies (pursuant to the applicable provisions of
ca do Ceará - Coelce SA (a Brazilian company belonging
Article 77, paragraph 2-bis, of the CONSOB Issuers Regu-
to the Enersis Group); 8) Edegel SA (a Peruvian company
lation approved with Resolution 11971 of May 14, 1999,
belonging to the Enersis Group); 9) Emgesa SA ESP (a
as amended);
Colombian company belonging to the Enersis Group); 10)
> the articles of association and composition and powers
Empresa de Distribución Eléctrica de Lima Norte - Edel-
of the control bodies from all the above subsidiaries have
nor SAA (a Peruvian company belonging to the Enersis
been obtained by Enel SpA and are available in updated
Group); 11) Empresa Distribuidora Sur - Edesur SA (an
form to CONSOB where the latter should request such
Argentine company belonging to the Enersis Group); 12)
information for supervisory purposes (pursuant to Article
Empresa Eléctrica Panguipulli SA (a Chilean company
36, paragraph 1b) of the CONSOB Market Rules);
belonging to the Enel Green Power Group); 13) Empresa
> Enel SpA has verified that the above subsidiaries:
Eléctrica Pehuenche SA (a Chilean company belonging to
- provide the auditor of the Parent Company, Enel SpA, with
the Enersis Group); 14) Empresa Nacional de Electricidad
information necessary to perform annual and interim au-
- Endesa Chile SA (a Chilean company belonging to the
dits of Enel SpA (pursuant to Article 36, paragraph 1, lett.
132
Annual Report 2015 c-i) of the CONSOB Market Rules);
sheet and financial data necessary for preparation of the
- use an administrative and accounting system appropriate
consolidated financial statements (pursuant to Article 36,
for regular reporting to the management and auditor of the
paragraph 1, lett. c-ii) of the CONSOB Market Rules).
Parent Company, Enel SpA, of income statement, balance
Approval of the financial statements
The Shareholders’ Meeting to approve the financial state-
limit of 120 days from the close of the financial year, permitted
ments, as provided for by Article 9.2 of the bylaws of Enel
under Article 2364, paragraph 2, of the Italian Civil Code, is
SpA, shall be called within 180 days of the close of the finan-
justified by the fact that the Company is required to prepare
cial year. The use of that time limit rather than the ordinary
consolidated financial statements.
Disclosures on financial instruments
The disclosures on financial instruments required by Article
ment”, note 33 “Derivatives and hedge accounting” and note
2428, paragraph 2, no. 6-bis of the Civil Code are reported
34 “Fair value measurement” to the separate financial state-
in note 31 “Financial instruments”, note 32 “Risk manage-
ments of Enel SpA.
Transactions with related parties
For more information on transactions with related parties, please see note 35 to the separate financial statements of Enel
SpA.
Own shares
The company does not hold treasury shares nor did it engage in transactions involving own shares during the year.
Atypical or unusual operations
Pursuant to the CONSOB Notice of July 28, 2006, Enel did
lating the transfer price or timing could give rise to doubts
not carry out any atypical or unusual operations in 2015.
concerning the propriety and/or completeness of disclosure,
Such operations include transactions whose significance,
conflicts of interest, preservation of company assets or pro-
size, nature of the counterparties, object, method for calcu-
tection of minority shareholders.
Subsequent events
Significant events following the close of the year are discussed in note 50 to the consolidated financial statements.
133
Report on operationsAnnual Report 2015 134
Annual Report 2015 Sustainability
135
Report on operationsAnnual Report 2015 How we operate
At Enel, sustainability is a strategic, integrated part of busi-
The integration of sustainability factors into business pro-
ness management, development and growth with a view
cesses is based on and extends the lessons learned within
to creating value over the medium to long term, both for
the Group in developing operations management models
the Company and for all of our stakeholders.
(for Business Development, Engineering & Construction,
In 2015, Enel ranked fifth in Fortune magazine’s Change the
and Operation & Maintenance) aimed at creating shared
World list. It was the only Italian company of the 50 com-
and inclusive value in the medium/long term. Indeed, the
panies on the list that are contributing to change the world,
efficacy and efficiency of business processes, during both
which is a challenge and great responsibility towards its
development and operations, highly depend on establi-
shareholders, stakeholders and, above all, towards future
shing stable, constructive relationships with stakeholders
generations.
and on the ability of becoming a synergistic part of the local
To be sustainable means to be competitive today and to-
communities, preventing and addressing potential adverse
morrow and environmental, social and economic sustai-
social and environmental impacts.
nability is the key to growth in the energy sector. This is
More specifically, in 2015, 633 sustainability projects were
why the Group is developing a strategy that combines
developed regarding access to energy, social and economic
business and sustainability, that balances the interests of
development of the communities, support to local com-
stakeholders and the demands of local communities and
munities and Company initiatives for fostering sustainable
that fosters the development of renewable technologies in
working practices that have benefited 6.14 million people
an environmentally-friendly manner. The aim is to achieve a
for a total investment of around €67 million, around 41% of
complete vision based on listening and on the involvement
which were contributions from outside the Company, from
of populations on the rational use of resources that does
other project partners, loans and tax incentives.
not separate social progress from economic progress.
Framing this entire process are the principles of ethics,
Under Enel’s organizational model, a dedicated Innovation
transparency, anti-corruption, human rights and safety that
and Sustainability unit reports directly to the Chief Execu-
have always been a distinctive feature of Enel’s operations
tive Officer in order to stress how much these two areas
and which are a part of policies and standards of conduct
and their specific activities complement each other and
that are applicable throughout the Group.
contribute to the creation of a new model of business and
This model is fully in line with the indications of the United
competitiveness for the Company. At the Country level, Su-
Nations Global Compact, of which Enel has been an acti-
stainability Managers report directly to the Country Mana-
ve member since 2004, reiterating the importance of an
ger in order to implement the Group’s strategic guidelines
increasing integration of sustainability within a company’s
and policies at the local level and to develop sustainability
strategic decision-making processes. As of June 1, 2015,
projects and other activities specific to each area.
Enel’s Chief Executive Officer is a member of the Board of
Sustainability is integrated in the business model throu-
the United Nations Global Compact, the first representative
ghout the value chain and the Group’s strategy is interpre-
of an Italian company and the only Chief Executive Officer
ted and converted into concrete actions through a rigorous,
of an utility to be appointed to this position.
challenging and shared Sustainability Plan. This ensures
Enel undertakes to constantly manage and measure its
periodic disclosures of important information, both inside
sustainability performance by using and developing me-
and outside the Company, and increases its capability of
chanisms that allow for an integrated, standardized system
attracting long-term socially responsible investors. Essen-
of projects, information and consistent data that are kept
tially this approach is based on the implementation of envi-
constantly up to date based on developments in the scope
ronmental, social and governance sustainability indicators
of operations and relevant standards, while promoting the
(ESG) throughout the value chain, not only for ex-post as-
sharing of best practices and lessons learned.
sessments but above all to anticipate decision-making and
Among these, Enel has developed systems for analyzing
privilege a proactive, not reactive, stance.
priorities, managing and reporting on performance, as well
Enel wants to drive change and anticipate new market op-
as mapping and monitoring sustainability projects.
portunities and is aware that it must begin by understan-
With a view to increasing transparency with stakeholders,
ding the context in which it operates.
the Group monitors and actively participates in the deve-
136
Annual Report 2015 lopment of new frontiers in reporting towards integrated
ronmental and social sustainability, in accordance with the
communication of financial and non-financial performance:
GRI international standards and the Electric Utility Sector
for example, in 2015, it supported the Global Reporting Ini-
Supplement (EUSS), as well as with the principles of ac-
tiative (GRI) in defining the Reporting 2025 project in order
countability of the United Nations Global Compact. The Su-
to promote international dialogue on the future of sustaina-
stainability Report 2015 also includes Enel’s commitment
bility reporting.
to achieving the United Nations’ post- 2015 Sustainable De-
The reporting process involves collecting and calculating
velopment Goals (SDGs) as announced in September 2015.
specific key performance indicators of economic, envi-
Enel’s commitment to the United Nations’
Sustainable Development Goals
On September 25, 2015, the United Nations formally adopted the new Sustainable Development Goals
(SDGs) 2030 that were officially launched the next day at the Private Sector Forum held in New York City.
Through the SDGs, the United Nations called on companies to be creative and innovative in addressing
the challenges of sustainable development, such as poverty, gender equality, clean water, clean energy,
and climate change. The success in achieving the new goals will rely heavily on the policies that will be
implemented by all actors involved.
At the UN summit, Enel announced the Group’s intention to contribute to four of the UN’s 17 Sustainable
Development Goals. More specifically, the Group will contribute by:
> ensuring access to affordable, sustainable and modern energy through its ENabling ELectricity initiative,
which will benefit three million people in Africa, Asia and Latin America (SDG 7);
> supporting education initiatives for 400,000 people by 2020 through projects similar to those already un-
der way, such as Powering Education in Kenya, Ubuntu in South Africa, and scholarship programs in Latin
America (SDG 4);
> promoting sustained, inclusive and sustainable economic growth and employment for 500,000 people
through initiatives such as coffee cultivation and marketing in Peru and greenhouse farming in Chile (SDG
8); and
> working towards becoming carbon neutral by 2050 (SDG 13).
Projects, activities, performance, and main results, inclu-
again to the Dow Jones Sustainability Index World and has
ding progress towards achieving the SDGs in line with SDG
received the prestigious “Silver Class” sustainability reco-
Compass, are presented in Enel’s Sustainability Report. The
gnition in the 2016 Sustainability Yearbook published by Ro-
completeness and reliability of the report are verified by an
becoSAM, who assesses the sustainability performance of
accredited external auditing firm, by the Group Risk Com-
the largest global companies. Enel has also been included in
mittee, and by the Corporate Governance Committee. The
the STOXX Global ESG Leaders, in the ECPI and NYSE Eu-
Board of Directors of Enel SpA then approves the document
ronext sustainability indices and is one of the utilities in the
before it is presented to the shareholders.
prestigious CDP Italy Climate Disclosure Leadership index
The report is also analyzed by socially responsible investment
for 2015 as a leader in terms of the quality, thoroughness
funds, which continue to increase in number. As of Decem-
and transparency of greenhouse gas emission data and of
ber 31, 2015, 132 socially responsible investors held shares
its commitment to mitigating climate change.
in Enel capital (134 in 2014) for a total interest held of around
Enel was again included in the FTSE4Good index, which
7.7% in Enel shares in circulation (5.9% in 2014), equal to
measures environmentally sustainable corporate practices,
10% of the float (8.6% in 2014).
relations with stakeholders, respect for human rights, the
The Group has been named to the Dow Jones Sustainability
quality of working conditions and tools that companies em-
Index for the twelfth consecutive year as industry leader in
ploy to fight corruption.
the Electric Utilities sector. In 2015, Enel has been named
137
Report on operationsAnnual Report 2015 Priority analysis and Sustainability Plan
For several years, Enel has conducted materiality analyses
The materiality analysis, which is conducted with increasin-
– based on the guidelines of the most widely spread stan-
gly greater detail, in terms both of issues and geographical
dards such as GRI-G4 – in order to identify the Group’s in-
scope, makes it possible to obtain the Company and sta-
tervention priorities, the issues to consider for disclosure
keholder priorities for the entire Group and for each count-
and which stakeholder engagement activities to strengthen.
ry of operations. It is also possible to obtain results with
The aim is to map and assess the priority of the issues of
a specific focus such as the matrix for the sole stakehol-
interest to stakeholders, integrating them into the Group’s
der category of “Financial community“, which is useful for
business strategy and priorities for action.
identifying issues to be discussed in the Annual Report that
Through this analysis, the main stakeholders of the Group
is particularly of interest to this type of stakeholder. More
are identified, assessed according to their importance to
specifically, priority issues such as the creation of econo-
the Company and to their priorities on the various issues
mic and financial value, innovation and operating efficiency,
approached in the numerous engagement activities. This in-
occupational health and safety and climate strategy have
formation is then crosschecked with the assessments of the
emerged from the analysis.
issues on which Enel intends to focus its efforts, with the
Based on the material analysis results, the issues to be in-
respective priority value.
cluded in the reports are defined and the specific targets
By observing the two perspectives together, it is possible to
and objectives of the 2016-2020 Sustainability Plan are set.
identify the issues, which, due to their relevance and priority,
Operations and projects regarding various functions and bu-
are essential to Enel and its stakeholders. Consequently, it is
siness lines of the Group contribute towards achieving these
possible to verify the degree of alignment or misalignment
targets and objectives.
between external expectations and internal priorities.
The four pillars of corporate ethics
For over 10 years, Enel has had a solid system of ethics that
nal best practices that everyone who works for and with
underlies its sustainability efforts. This system has become
Enel must respect and apply in their daily activities.
a dynamic set of rules constantly incorporating internatio-
Code of Ethics
In 2002, Enel adopted the Code of Ethics, which expresses
and traceability, and to harmonize the assessment systems
the commitments and ethical responsibilities in conducting
at the Group level in order to ensure timely assessments.
business and in Company activities. This Code is applicable
In the new process the performance of the preliminary
in Italy and abroad while taking into account the cultural,
analyses of the violation reports received has been impro-
social and economic diversity of the various countries in
ved, 124 alleged violations were reported over the past
which Enel operates. The Code of Ethics is binding for all
year, of which 32 were classified as violations of the Code
Enel employees and collaborators and all of the companies
of Ethics. In order to continue improving the preliminary
in which Enel has an equity interest; the Group’s major sup-
analyses process, as of January 2016, a new, online com-
pliers are also required to adhere to the general principles
munications channel for the entire Group is available for
contained therein.
reporting any violation or suspicion of a violation of Enel’s
In 2015, the process of managing the reports of alleged
Compliance Programs, which have been adopted in the va-
violations has been revised to ensure greater transparency
rious countries in which Enel operates.
138
Annual Report 2015 Other indices
No.
Confirmed violations of the Code of Ethics (1)
2015
32
2014
31
Change
1
3.2%
(1) In 2015, an analysis was performed of the violations reported in 2014. As a result, the number of verified violations for 2014 was reclassified from 27 to 31.
Compliance Model (Legislative Decree 231/2001) - Model 231
The Compliance Model pursuant to Legislative Decree
tion in both the public and private sectors, manslaughter or
231/2001 (which was revised in 2015 in response to the
assault causing severe, or very severe, injury, committed in
introduction of new crimes envisaged under applicable law)
breach of workplace health and safety provisions as well as
supplements the rules of conduct of the Code of Ethics and
environmental offences. The principles found in the model
is aimed at preventing the risk of the commission of the cri-
extend to all of the Group’s foreign subsidiaries through the
mes specified under the decree, including those of corrup-
adoption of specific guidelines.
Zero-Tolerance-of-Corruption Plan
The Zero-Tolerance-of-Corruption Plan supplements the
adopted in 2006 as a concrete move marking Enel’s parti-
Code of Ethics and the Compliance Model and assigns spe-
cipation in the Global Compact and the Partnering Against
cific responsibilities for monitoring corruption risks and for
Corruption Initiative (PACI) promoted by the World Econo-
appropriately handling any suspected case. The plan was
mic Forum in Davos in 2005.
Policy on Business and Human Rights
In order to give effect to the guidelines of the UN Forum on
the part of the employees of Enel SpA and its subsidiaries,
Business and Human Rights, in 2013, the Board of Directors
whether they be directors or employees in any manner of
of Enel SpA approved the Human Rights Policy, which was
those companies. Similarly, with this formal commitment,
subsequently extended to all of the Group’s subsidiaries. In
Enel explicitly becomes a promoter of the observance of
line with the Code of Ethics, this policy sets out the com-
such rights on the part of contractors, suppliers and busi-
mitments and responsibilities in respect of human rights on
ness partners as part of its business relationships.
139
Report on operationsAnnual Report 2015 Creating value for stakeholders
Enel’s stakeholders are individuals, groups or institutions
good indication of how the Group has created wealth for the
whose contribution is needed to achieve its mission or who
following stakeholders: shareholders, lenders, employees
have a stake in its pursuit.
and government.
The economic value created and shared by Enel gives a
Millions of euro
Revenue
Income/(Expense) from commodity risk
External costs
Gross global value added from continuing operations
Gross value added from discontinued operations
2015
75,658
168
53,323
22,503
-
22,503
1,316
2,848
5,314
3,369
9,656
2014
75,791
(225)
53,390
22,176
-
22,176
1,222
3,007
4,864
654
12,429
Gross global value added
distributed to:
Shareholders
Lenders
Employees
Government
Enterprises
Towards sustainable innovation
Enel has always considered innovation as a key part of its
the INternet Cleantech ENablers Spark (INCENSe) project,
strategy and culture of enterprise for adopting cutting-edge
which is funded with €8 million by the European Union. Enel
methods, models and technologies.
also launched the Energy Start project in South America.
In 2015, the Enel Group carried out research and innovation
Another cornerstone of the Open Innovation strategy is
activities with over 250 projects throughout the value chain,
the involvement of all Group employees in the innovation
that is, from conventional power generation to renewable
process. Accordingly, significant emphasis is placed on the
energy, from smart grids to energy efficiency, and from elec-
development of instruments that stimulate creativity, facili-
tric mobility to energy storage.
tate participation, develop innovation and entrepreneurship
In order to find, develop and capitalize on the best solutions
competences, and strengthen the culture of innovation. The
available, Enel has adopted an Open Innovation principle
Enel Idea Factory project draws inspiration from these ele-
whereby, in order to create more value and better compete
ments to turn workplaces into creative brainstorming labora-
on the market, it is not enough only to rely on in-house ideas
tories and promote integration among the various company
and company human resources, but other companies, start-
units, open up towards the outside, and foster dialogue with
ups and universities must also be involved.
several internal and external interlocutors. In this spirit, in
The Endesa 2244 channel, dedicated to companies that
2015, corporate entrepreneurship initiatives such as Enel In-
wish to propose ideas and projects, was launched in Spain.
novation World Cup and the Inspire Empreendedores were
Various activities were also launched on the Endesa Energy
launched.
Challenges platform.
In addition, Enel has established several partnerships with
leading companies and increased its exposure to start-ups
Renewable energy
in order to develop new business models and foster the de-
During the year, the Group’s commitment to innovation fo-
velopment and implementation of new technologies (1,200
cused on various areas, including improving technological
start-ups were analyzed and 13 collaborations launched).
performance, an area in which Enel Green Power has tradi-
As regards incubation and acceleration programs aimed at
tionally been present. Enel Green Power intends to increase
supporting the most promising start-ups, Enel coordinates
the people’s access to energy through improved technologi-
140
Annual Report 2015 cal performance by combining the use of various power ge-
as reduced carbon dioxide emissions and noise pollution as
neration technologies with electrochemical energy storage
well as the possibility of using the vehicles, through their
systems in order to build off-grid plants.
batteries, as distributed energy storage systems.
Enel also focused on developing renewable energy in urban
Over the past year, Enel has intensified its commitment
environments by using small-scale plants that have a low
to electric mobility by developing various projects, among
visual impact such as cutting-edge wind power generators
which an agreement signed in December 2015 with Nissan
and small-scale thermodynamic solar systems, which are
to develop a new business based on vehicle-to-grid (V2G)
better suited for architectural integration.
technology, which Enel has been developing since 2011. This
The use of new renewable resources that are not exploited
technology allows drivers as well as energy users to operate
yet is another area of strong interest, in particular energy
as individual “energy hubs“ with the ability to use, store and
from the sea and high-altitude wind energy.
return electricity in excess to the grid. Aggregating the distri-
Among Enel’s various start-up partners, i-EM, which opera-
bution loads allows using vehicles for providing grid-balan-
tes in the renewable energy sector, has developed a sophi-
cing services thus promoting the penetration of renewables.
sticated software that, using artificial intelligence algorithms,
Various projects have also been implemented in Spain and
can forecast and control the output of solar and wind plants.
South America such as Zero Emissions Mobility to All (Ze-
It has also developed a solution for the remote monitoring
m2All), which introduced a fleet of 200 electric vehicles and
and maintenance of power plants.
the development of the necessary charging infrastructure
Energy storage
in Malaga, Spain, and the Electric Mobility program in San-
tiago, Chile for the installation of recharging infrastructures
with the collaboration of public authorities in order to pro-
Energy storage continued to be an important sector in 2015.
mote electric technology and the development of ambitious
In addition to continuing with the installation of energy sto-
business models in the public transport sector.
rage systems on wind power plants, Enel is focusing on re-
sidential energy storage systems. Partnership agreements
were signed with the sector’s leading companies towards
Grid services
developing integrated energy storage and photovoltaic sy-
Enel has always been committed to numerous initiatives ai-
stems, testing them on the market and then selling them to
med at innovating energy distribution systems in order to
countries with a high business potential for these systems,
constantly improve grid efficiency.
starting from South Africa. Residential energy storage sy-
Among some of the most interesting initiatives in this field
stems allow consumers to store their self-produced energy
is the collaboration with Athonet Smartgrid, a start-up that
(from systems such as photovoltaic) in batteries for later
developed a system capable of creating a high-speed, low
domestic use when the home is not connected to the grid
latency private data network. Enel uses this technology to
or in the event of a power blackout.
provide telecommunications coverage to plants that are lo-
The advantages of integrating energy storage systems into
cated in areas that are not served by other operators and to
conventional energy generation, albeit on a larger scale,
manage mission critical communications (management of
have also been tested. Recently, on the island of Ventotene,
reserved data), including at a number of generation plants
a lithium ion battery (300 kW/600 kWh) was installed and
such as the Federico II facility at Brindisi. This solution gene-
fully integrated into the existing diesel generator system
rates considerable positive externalities because, in addition
paired with an ad hoc optimization and control system.
to serving Enel’s plants, it serves their surrounding area.
Electric mobility
infrastructure
Electric mobility represents an increasingly important sector
to be developed, above all for its numerous benefits such
Also, in its plan to become a virtual telecommunications
network operator, the Group selected Athonet Smartgrid’s
technology for more competitive – in terms of costs and
performance – communications to and between millions of
Enel’s machines and sensors throughout the area and will
create a new generation Industrial Internet of Things.
141
Report on operationsAnnual Report 2015 Customers
In 2015, Enel confirmed its status as a Company that pays
community. EnelPremia 3.0 is the new version that rewards
particular attention to customers and to the quality of ser-
sustainable behavior such as recycling, awareness of power
vice, aspects that concern more than just the provision of
consumption and commitment to the community.
electricity and natural gas, extending, above all, to intangible
Finally, 2015 was the year of Expo 2015, which saw the Com-
aspects of the service involving the perception and satisfac-
pany involved as Lighting Solutions Partner contributing to
tion of customers. The Group has also launched programs
the creation of the first smart city in the world comparable
and other initiatives for people with disabilities in order to
to a city of 100,000 inhabitants.
ensure the effective communication of important informa-
In order to provide the best support and assistance to its
tion to customers.
clients in Romania, Enel launched offerings for energy pro-
In December 2015, the ISO 9001 certification for both mar-
vision that included insurance packages and also launched a
kets, electricity and gas, was confirmed with 100% com-
pilot project aimed at improving access to electricity to the
pliance with respect to customer relations management
vulnerable groups living in deprived areas of Bucharest.
through the Contact Center, Punti Enel and online channels.
In order to provide our customers with the best support pos-
In 2015, various communications campaigns were also car-
sible, since 2003, in Spain and Portugal, Endesa has adopted
ried out so that customers would better understand infor-
the Plan de Excelencia en la Atención Comercial (the Excel-
mation regarding the energy sector, including the campaign
lence in Customer Service Plan), which seeks to improve
to help customers understand the new Bolletta 2.0 utility
customer satisfaction indicators year after year. In 2015,
bill launched in January 2016. Enel’s new gas and electricity
efforts under the plan focused on improving the quality of
bill has a new layout, its content has been rationalized and
customer service (both via phone and online), handling com-
organized, simpler language is used, and personalized custo-
plaints on the free market, flexibility in billing services, and
mer information is included; new services are also available
analyses of consumption patterns. In addition the portfolio
through the Enel Energia app.
of value added products and services continued to expand
During the year, new electricity and gas offerings were laun-
and new business models and sales channel to be develo-
ched, which included ENERGIAX65 and ENERGIA XOGGI
ped. In the residential sector, new solutions were developed
that adopt sustainability as a marketing driver. Indeed, both
to promote energy efficiency and proactively manage ener-
plans concern the provision of green energy and have a gre-
gy consumption.
at social impact: ENERGIAX65 is reserved for customers
As regards the Latin America area, significant activities for
over 65 years of age, who will enjoy a fixed price for three
promoting energy efficiency were launched, in particular
years including a Health and Wellbeing insurance policy for
in Argentina, where technologies for efficient lighting and
them and their family. While for each subscription to ENER-
heating continued to be sold, and in Brazil, where projects
GIA XOGGI, Enel Energia is committed to donating €2 throu-
were launched for promoting awareness of responsible con-
gh Enel Cuore to support digital education in kindergartens
sumption in deprived areas in which the Group companies
and primary schools. Moreover, the dissemination of LED
Ampla and Coelce operate. Over 13,000 people benefited
technology continued throughout 2015 with over 800,000
from initiatives aimed at improving energy efficiency, which
light bulbs sold.
led to a significant 18% reduction of energy use in the two
As of December 2015, the EnelPremia program for Enel
areas concerned.
customers was completely renewed in an even more su-
stainable form with respect to the environment and the
142
Annual Report 2015 Customers by geographical area
Average no.
Electricity
Italy
Latin America
Iberian Peninsula
Romania
Other countries
Total electricity customers
Natural gas
Italy
Spain
Total natural gas customers
Society
2015
2014
Change
27,072,083
27,207,897
15,074,266
14,633,393
11,150,886
11,290,283
2,691,849
2,670,892
7,275
5,985
55,996,359
55,808,450
3,711,422
1,246,662
4,958,084
3,470,692
1,205,463
4,676,155
(135,814)
440,873
(139,397)
20,957
1,289
187,909
240,730
41,199
281,929
-0.5%
3.0%
-1.2%
0.8%
21.5%
0.3%
6.9%
3.4%
6.0%
The intrinsic nature of the electricity business, in which power
Partnerships between the private sector and non-profit or-
plants and distribution networks are built to last several deca-
ganizations are an important means of promoting social and
des and the service provided is an essential part of social and
economic growth in the communities, while also generating
economic development, requires that we establish a lasting
long-lasting, shared value. With a view towards innovation
relationship with the communities in which we operate.
and decentralization and in order to support local small bu-
Creating shared value means knowing your stakeholders,
siness and socio-economic development generally, we have
giving a voice and listening to them all in order to promote
entered into numerous partnerships with NGOs and non-
constant constructive dialog, to be aware of the needs and
profit organizations throughout the world.
priorities of the community, and to compare them with the
needs of our business while minimizing impacts.
Enel makes a concrete contribution to social and economic
Access to energy
development in these communities through various types of
Currently, there are over a billion people around the world
initiatives, such as the expansion of infrastructures, educa-
that have no access to electricity, and over 2 billion are being
tion and training programs, projects of social inclusion, and
served by inadequate infrastructures or are unable to pay
support for local cultural and economic activities. In 2015,
for their utilities due to financial hardship. Given this con-
we conducted over 600 projects and other initiatives in the
text, the fight against energy poverty is the focus of one
nations in which we have a presence.
of the United Nations Millennium Development Goals, as
These projects and initiatives are selected by way of
reaffirmed by the UN General Assembly, which unanimously
analyses of materiality and in line with our Sustainability
declared the period 2014-2024 as the Decade of Sustainable
Plan, which takes account of detailed peer benchmarking
Energy for All.
and studies of trends in sustainability, while also adapting
Within this context, Enel launched the Enabling Electricity
to the needs of the various countries in which we opera-
program with the goal of creating a new business model
te, whether they have mature or emerging economies. In
based on the access to energy, one which targets both pe-
order to create value in our areas of business, Enel turns
ople living in isolated rural areas and those who live in the
to partners in the local communities, which bring innovative
outskirts of major metropolitan areas. Projects under this
ideas to be turned into concrete action. This constant dialog
program seek to:
with the communities is at the heart of our business model,
> eliminate financial barriers to accessing electricity;
and the presence of NGOs with in-depth knowledge of the
> develop technologies that facilitate access to infrastructures;
local contexts throughout out territories enables us to gui-
> promote technical training and capacity building;
de and implement innovative actions that target the needs
> promote energy efficiency;
of our stakeholders and contribute to local development.
> promote energy awareness.
143
Report on operationsAnnual Report 2015 In 2015, 124 projects benefitting 1.5 million people were im-
change has begun. The divestment plan came to a close
plemented in line with the goals of the Sustainability Plan.
with the agreement to sell off the Slovakian assets, and a
Examples include:
plan was begun to bring Enel Green Power back within the
> Cosciencia Ampla in Brazil, an integrated program to
Enel Group.
combat energy poverty aimed at promoting social in-
The introduction of the new organization was supported by
clusion in the favelas and other high-risk areas. Through
numerous global training initiatives to accompany this chan-
projects of waste exchange, social tariffs, business deve-
ge. This training targeted both the various cross-functional
lopment, and education, it has been possible to recover
levels of management and new global teams within the bu-
up to 70% of energy theft in the areas affected;
siness lines and the corporate and service functions. These
> Ralco Electrification Plan in Chile, a hybrid electrifica-
actions helped to promote reflection, disseminate Enel’s
tion project in a hard-to-access area not covered by the
new values (responsibility, innovation, proaction, and trust),
grid. It is a public-private partnership integrated with a
and promote proper conduct throughout the organization in
project for the collection of drinking water for the indige-
line with the strategic concept of Open Power.
nous community of Allin Mapu;
Health and safety training plays a key role in ensuring that
> Cátedra Chilectra in Chile, a program that seeks to en-
our business brings results while respecting individuals and
hance the employability of students through the deve-
the organization’s new values, and investment in language
lopment of specialist electrical skills in both middle and
training is an important means of supporting integration,
secondary school. Cátedra Chilectra is being developed
particularly within the global functions. Another necessary
with the help of company employees as voluntary edu-
part of employee development is represented by technical
cators;
and professional training, which is further enhanced by op-
> PlayEnergy, a fun, educational project that Enel has been
portunities arising from the sharing of knowledge and best
pursuing for several years with the goal of disseminating
practices that emerge within the global functions.
a culture of responsible energy use among young people,
beginning with free courses that provide the knowledge
needed to promote responsible energy decisions.
Our people
Human resource selection,
management and
development
As at December 31, 2015, the total workforce of the Enel
In 2015, the new strategic direction for the Group led to a
Group numbered 67,914 employees, divided roughly equally
redefinition of the values and conduct expected of everyone
between Italy (49%) and abroad (51%).
working with Enel, a process that involved contributions by
over 8,000 people by way of workshops, focus groups, quick
The net effect of new hires and terminations of employment
polls and interviews.
during the year has resulted in a reduction in the total work-
In line with these new values (of responsibility, innovation, pro-
force (1,316 fewer employees). The changes may be broken
action and trust), we have radically transformed processes that
down geographically as follows: 5% of the new hires were
concern human resources and overhauled the entire system of
in Italy, with the remaining 95% being distributed across
hiring, managing, and developing our people.
the other nations (mainly in Latin America and including are-
Our strategies for selecting and developing talent has also
as in which Enel Green Power has a presence); 19% of the
been revised in order to better serve the specific needs of
terminations were in Italy, while the remaining 81% were
our business. This has also involved the design and imple-
abroad.
mentation of new development processes based both on
In 2015, the Enel organizational model was updated in or-
challenging projects and other priority business activities
der to support global development and sustainable business
and on taking advantage of individual differences throughout
management, and roles and responsibilities were rewritten
the workforce. In 2015, we launched an international mo-
where necessary in order to optimize resources and make
bility plan that seeks to promote skills development and
existing processes more efficient. We have completed the
integration in a manner that engages the youngest emplo-
process of separating Endesa, in Spain, from the various
yees within the Group. This program gives participants the
companies in Latin America, where a process of corporate
opportunity to experience international contexts in positions
144
Annual Report 2015 of responsibility over specific processes in order to learn cru-
functions. These initiatives helped to stimulate reflection and to
cial skills more quickly and to prepare themselves for the
disseminate Enel’s new Open Power vision, as can be seen in
complex challenges of the future through proper coaching
the implementation of a training program that makes use of “in-
and tutoring.
cubators” in order to bring out the talents and skills in new hires
Individual development plans, based on a range of training me-
that they are expected to demonstrate in the new Enel.
thods (e.g. mentoring, coaching, mobility, etc.) suited to the
specific development needs at hand, have also been defined for
people who demonstrate the greatest potential.
Diversity and inclusion
The performance appraisal process has been handled in line
Integration of the various contexts throughout the Group has
with previous years, but we have also worked to overhaul
made it necessary to assess and take advantage of the we-
the entire process in order to make it more accessible at all
alth of cultural differences found here.
levels of the organization, more focused on feedback, and
We have also continued working on the diversity and inclu-
more in line with our new values, expectations of conduct,
sion project. In January 2015, we began conducting dedica-
and the new organization.
ted focus groups, interviews with senior management, and
The hiring process and related tools have also been revised
a survey that focuses on diversity and inclusion in order to
in light of the profound transformation that is under way,
gather information on issues such as our internal climate and
while also adapting them to specific targets and local practi-
to monitor employee satisfaction. A sample population of
ce. We have introduced innovating hiring systems that ena-
employees in the various countries in which Enel operates,
ble us to determine whether candidates are a good cultural
selected using statistical parameters (such as geography, or-
fit and to assess their cross-functional skills, which, together
ganizational unit, age, professional category, etc.), was invol-
with technical knowledge, are of strategic importance in me-
ved in the survey.
eting future business challenges.
The overall results have led to local initiatives and the prepara-
In 2015, we worked to strengthen strategic partnerships in
these policies establish a series of actions to be taken that
academia and with other centers of excellence of particular
will have an immediate impact on the issues encountered.
importance to the future of our business, and we have re-
At the same time, each country has defined numerous local
defined our employer branding policies in order to promote
initiatives that better focus on the needs that have emerged
tion of specific policies for the Group. For each area studied,
Enel’s image within a globally recognized business commu-
within their own local contexts.
nity, policies that take advantage of a new digital strategy
adopted throughout the Group.
As concerns training and development in 2015, we confir-
Labor relations
med the central importance of specialist technical training –
Enel complies with the labor laws of the various countries in
including both mandatory programs and structured programs
which we operate and with the International Labor Organiza-
within the academies – together with occupational health
tion (ILO) conventions on labor rights (freedom of association
and safety training in line with the significant investments
and of collective bargaining, consultation, the right to strike,
in this direction in previous years. Particular emphasis has
etc.), while systematically promoting dialog between the par-
been placed on cross-functional training to help facilitate
ties and seeking an adequate level of agreement on and parti-
the significant strategic and organizational changes and on
cipation in Company strategies by employees.
language training to support integration within the global
Labor relations efforts at the Group level continue to be con-
functions in particular. At the same time, training campaigns
ducted in accordance with the model established under Enel’s
concerning ethics and sustainability were extended to Latin
Global Framework Agreement (GFA) signed in Rome in 2013
America and the Enel Green Power Group in 2015.
with the Italian federations and with the global federations
In particular, the introduction of the new matrix-based organi-
IndustriAll and Public Services International. This agreement
zation and the profound transformation of HR policies and
is based on the principles of human rights, of labor rights and
strategies were supported by numerous global training initiati-
of the best, most advanced systems of transnational labor
ves to accompany this change. This training targeted both the
relations for multinational corporations and international orga-
various cross-functional levels of management and new global
nizations, including the ILO.
teams within the business lines and the corporate and service
In 2015, we intensified our efforts with regard to information
145
Report on operationsAnnual Report 2015 and consultation for both the European and Global Works
meeting in Milan in July 2015 at the same time as Enel’s tour
Council as concerns the Group’s new organization and the
of the national pavilions. At the various meetings of the Select
scheduled meetings with the heads of the global business
Committee, we also defined joint training efforts on sustaina-
lines. The organization of the 2015 Milan Expo and Enel’s ac-
bility and economics in November in conjunction with the se-
tivities both in our own pavilion and in management of the
cond EWC/GWC meeting, which was well received by the va-
Expo’s smart city gave us the opportunity to hold the plenary
rious members of the Group’s worker-representation bodies.
Workplace health and
safety
The constant commitment of us all, the integration of safety
both in our processes and in our training, the reporting and
analysis of near misses, rigor in the selection and manage-
Enel considers employee health, safety, and general well-
ment of contractors, constant control over quality, the sha-
being to be the most valuable asset, one to be protected
ring of experience throughout the Group, and benchmarking
both at work and at home, and we are committed to deve-
against the leading international players are all cornerstones
loping and promoting a strong culture of safety throughout
to Enel’s culture of safety.
the world.
Safety rates
No.
Injury frequency rate - Enel
Injury severity rate - Enel
Serious and fatal injuries at Enel
Serious injuries (1)
Fatal injuries
Total
Serious and fatal injuries at contractors
Serious injuries (1)
Fatal injuries
Total
2015
1.27
0.05
3
4
7
24
9
33
2014
1.32
0.07
1
3
4
22
16
38
Change
(0.05)
(0.02)
2
1
3
2
(7)
(5)
-3.8%
-33.4%
-
33.3%
75.0%
9.1%
-43.8%
-13.2%
(1) Injuries with an initial prognosis, as reported on the medical certificate issued, of greater than 30 days, or with a confidential prognosis until the actual pro-
gnosis is released, or with an unknown prognosis that, based on an initial assessment by the company/Division concerned, is expected to exceed 30 days.
Once the official prognosis is released, the related injury is considered serious only if said prognosis exceeds 30 days. Should a confidential prognosis never
be released or an unknown prognosis remain unknown, within 30 days of the event, the injury is to be deemed serious.
Workplace accident statistics
reporting of accidents, analysis of their cause, and definition
and monitoring of improvement plans. The new version of
In 2015, the lost time injury frequency rate (LTIFR) and lost
these policies also details the procedures for disclosing and
day rate (LDR) for Enel Group employees settled at 0.255
analyzing near misses that could have resulted in serious
(down 3% from 2014) and 9.44 (down 33% from 2014), re-
harm.
spectively. These rates for contractors came to 0.302 (down
In accordance with these policies, all serious and fatal in-
28% from 2014) and 10.89 (down 21% from 2014), respec-
juries to Enel employees and the employees of Enel con-
tively.
tractors and other significant, non-serious events have been
In 2015, there were 13 fatal accidents for the Enel Group (6
investigated by a team of experts.
fewer than in 2014), of which 4 were Enel employees and 9
These investigations have found the causes of the injuries
were employees of Enel contractors.
to be due, first and foremost, to unsafe conduct, followed
In 2015, we updated our policies for the classification,
by deficiencies in work planning, management and super-
communication, analysis and reporting of incidents, which
vision.
establish the roles and procedures that ensure the timely
Actions for improvement emerging from this analysis are
146
Annual Report 2015 constantly monitored until their completion. Steps have also
order to minimize or eliminate risks both to workers and to
been taken in relation to companies found to be in breach
the local communities. Plant, machinery and equipment are
of contract (e.g. contract termination or suspension of cer-
systematically controlled and periodically maintained in order
tification).
to ensure they function properly in accordance with applicable
For the purpose of prevention, we have also defined and
laws and regulations and with industry best practice.
implemented country-level improvement plans, which have
reduced injury rates in all geographical areas compared to
2014.
Infrastructure safety and
technological innovation
Safety in tender processes
New projects launched in 2015 concerning innovation in sa-
Enel follows companies closely, from the selection process
and on through execution of the given project. The new
model of vendor qualification for 2015 features a stricter
selection process based on health and safety performance,
including an in-depth pre-qualification audit for the vendor
categories that present the greatest safety risks.
In 2015, a global model was added to the vendor rating
system which establishes the impact on vendor rating of
significant injury to contractor employees.
In October 2015, the fifth edition of the General Contracting
Conditions (GCC) for the Enel Group went into effect. The
main changes in this edition include an updated list of health
and safety violations and the classification of these violations
into three levels of severity, as well as the inclusion of sub-
contracting guidelines in the general section. These guide-
lines establish the conditions under which subcontracting is
allowed, the minimum safety requirements to be possessed
by subcontractors used when executing contracts with Enel
Group companies, and the safety requirements that the con-
tractors and any subcontractors must observe.
In 2015, Contractor Safety Day was observed throughout
the Group, which featured the organization of contractor
workshops designed to discuss and promote health and
safety improvement efforts.
In concert with the activities aimed at increasing contrac-
tor awareness of health and safety issues, Enel has conti-
nued with field inspections and monitoring of works done
by contractors. During the year, over 350,000 contractor
audits were conducted throughout the Group, an increase
of 32% compared to the previous year.
Safety for the community
and other third parties
fety included:
> “Virtual Reality 3D Simulator for Health and Safety
Training”, a project to increase employee awareness of
safe, responsible conduct by learning from their mista-
kes. The virtual-reality 3D simulator was developed by a
cross-functional working group consisting of R&D, H&S
and ICT, together with the Sant’Anna School of Advanced
Studies, Pisa;
> “Intrinsic Safety”, a project focused on the analysis of
existing machinery and the design of new technologies
in order to reduce employee exposure to risk in the
workplace. The project emphasizes the sharing of infor-
mation and coordination between the H&S and Engine-
ering units in order to define, validate and disseminate a
method for identifying latent risks in machinery, systems
or equipment;
> “Virtual Check Point Contractors”, an application used
to monitor contractor employees and equipment during
on-site inspections. Using ID badges provided to contrac-
tor employees, we can determine whether people found
on site are those specified by the contractor and, more
specifically, if they have the qualifications needed for the
activities assigned;
> pilot projects at production facilities concerning the use of
inspection drones in flues, furnaces and ducting in order
to prevent risks related to human workers accessing the-
se areas directly;
> implementation in Spain of the smartphone and tablet
app APP5RO, which is used to provide photographic do-
cumentation of the proper execution of the various steps
of electrical work in accordance with Enel’s five golden ru-
les (namely: 1. Completely isolate the system; 2. Protect
against reconnection and place warning signs; 3. Ensure
there is no current in the system; 4. Ensure proper groun-
ding and short-circuiting; 5. Mark off the working area and
Enel facilities throughout our territory have been constructed
ensure the protection of nearby workers);
in accordance with applicable laws and regulations and are
> testing in Spain of a special helmet sensor that can de-
equipped with health and safety management systems in
tect a current (MV) prior to entering a hazardous area
147
Report on operationsAnnual Report 2015 and individual wearable sensors in Latin America that
conduct self-checks for breast cancer.
sound an alarm when detecting a current during schedu-
Given the healthcare crises around the world, we have also laun-
led dead-circuit activities.
ched awareness campaigns to protect employees traveling to
In 2015, we completed the New Hybrid Portable Lad-
countries at risk.
der project in Romania to develop (electrically) safer, more
In 2015, as a part of our health culture, we conducted the People
comfortable ladder technology. This new ladder is a first for
Care global assessment based in international standards, which
Enel in that it features (non-conducting) glass-resin upper
looked at the state of implementation of programs, projects and
section and two aluminum sections that reduce the ladder’s
policies in the countries in which we operate and in a range of
weight from 55 kg to 32. We have also developed a special
areas, including organizational health and wellbeing.
system for anchoring the ladder to pylons (regardless of their
In 2015, within the scope of efforts to enhance the Company’s
shape) and for anchoring the worker to the ladder. Also in Ro-
culture of work-life balance, work continued on implementation
mania, we have developed a custom approach to working on
of the Parental Program to optimize maternity management,
pylons on which fiber-optic cables have been installed below
which, in Italy, also expanded the provision of in-house daycare
electrical lines.
facilities in order to assist employees with children between the
For a number of years now, we have also been pursuing
ages of 3 to 12 during periods in which schools are closed.
a plan to improve the infrastructure standards of the Com-
The course Mamme in equilibrio (Balanced Mothers) also conti-
pany’s vehicle fleet, which has included the adoption of new
nued in 2015. This program is designed for employees returning
safety systems and devices, such as a black box that ma-
from maternity leave in order to help them reflect on ways of
kes it possible to provide driver assistance and support both
balancing their professional and personal lives.
when driving and in the event of an emergency.
Country-specific health initiatives have also been launched
alongside the various global activities.
Development of the Culture
of Safety: communication
and training
The seventh edition of International Health and Safety Week
was held from June 15 to 21, 2015. This event represents a
global opportunity for Enel to reflect on issues of health and
safety for all our employees.
There were also several communication campaigns concer-
ning health and safety during the year, focusing on areas of
particular importance to the organization.
The Listentothesigns road-safety campaign, featuring the di-
rect involvement of the Group’s CEO, began in September in
order to promote safe driving.
In 2015, we provided nearly 900,000 hours of safety training
and awareness activities in order to increase the specific skills
and knowledge of workers throughout the Group.
Health
In October 2015, in conjunction with the efforts of the World
Health Organization to prevent breast cancer, we launched a
global awareness campaign featuring examinations with spe-
cialist physicians and talks with women who have been cured
of cancer, as well as the distribution of useful advice and other
information, free screenings, and videos demonstrating how to
148
Annual Report 2015 Climate strategy and the environment
Net efficient capacity by primary energy source
2015
2014
Change
GW
Net efficient thermal capacity:
- coal
- CCGT
- fuel oil/gas
Total
Net efficient nuclear capacity
Net efficient renewable capacity:
- hydroelectric
- wind
- geothermal
- biomass and co-generation
- other
Total
Total net efficient capacity
16,841
16,099
14,637
47,577
5,132
29,046
6,653
833
99
402
37,033
89,742
Net efficient capacity by geographical area
GW
Italy
Iberian Peninsula
Latin America
Russia
Slovakia
North America
Romania
Belgium
Greece
Bulgaria
India
South Africa
2015
30,715
22,912
19,179
8,944
4,032
2,506
534
406
290
42
172
10
17,048
16,112
21,018
54,178
5,132
29,653
5,774
833
100
442
36,802
96,112
2014
36,823
23,549
18,300
9,107
4,968
2,083
534
406
290
42
-
10
(207)
(13)
(6,381)
(6,601)
-
(607)
879
-
(1)
(40)
231
(6,370)
Change
(6,108)
(637)
879
(163)
(936)
423
-
-
-
-
172
-
-1.2%
-0.1%
-30.4%
-12.2%
-
-2.0%
15.2%
-
-1.0%
-9.0%
0.6%
-6.6%
-16.6%
-2.7%
4.8%
-1.8%
-18.8%
20.3%
-
-
-
-
100.0%
-
-6.6%
149
Total net efficient capacity
89,742
96,112
(6,370)
Report on operationsAnnual Report 2015 Net electricity generation by primary energy source
2015
2014
Change
GWh
Net thermal electricity generation:
- coal
- CCGT
- fuel oil/gas
Total
Net nuclear electricity generation
Net renewable generation:
- hydroelectric
- wind
- geothermal
- biomass and co-generation
- other
Total
Total net electricity generation
85,677
40,542
28,682
154,901
39,837
65,939
16,204
6,205
241
685
89,274
284,012
81,991
37,395
29,654
149,040
39,182
74,315
14,054
5,954
166
390
94,879
283,101
2014
71,824
74,040
64,753
42,376
20,550
6,674
1,268
690
488
347
83
8
-
Net electricity generation by geographical area
GWh
Italy
Iberian Peninsula
Latin America
Russia
Slovakia
North America
Romania
Belgium
Greece
France
Bulgaria
South Africa
India
2015
68,519
77,444
67,114
42,090
18,292
7,368
1,330
1,150
549
-
90
18
48
Total net electricity generation
284,012
283,101
Other generation ratios
Generation from renewable resources (% of total)
“Zero-emission” generation (% of total)
ISO 14001-certified net efficient capacity (% of total)
Average efficiency of thermal plants (%) (1)
Specific emissions of CO2 from net generation
(gCO2/kWheq) (2)
Specific water withdrawal (l/kWheq)
2015
31.4
45.5
97.6
38.1
409
0.60
2014
33.5
47.4
94.3
37.8
395
0.64
3,686
3,147
(972)
5,861
655
(8,376)
2,150
251
75
295
(5,605)
911
(3,305)
3,404
2,361
(286)
(2,258)
694
62
460
61
(347)
7
10
48
911
(2.1)
(1.9)
3.3
0.3
14
(0.04)
Change
Change
4.5%
8.4%
-3.3%
3.9%
1.7%
-11.3%
15.3%
4.2%
45.2%
75.6%
-5.9%
0.3%
-4.6%
4.6%
3.6%
-0.7%
-11.0%
10.4%
4.9%
66.7%
12.5%
-100.0%
8.4%
-
-
0.3%
-6.3%
-4.0%
3.5%
0.8%
3.5%
-6.3%
(1) Percentages calculated using a new approach that does not include the oil and gas plants in the 2015-2016 disposal program or heat.
(2) Specific emissions have been calculated by taking account of the total emissions from simple thermal generation, combined electrical and heat, as a ratio
to the total generated by renewable sources, nuclear, simple thermal, and combined electrical and thermal generation (including the thermal contribution in
MWh equivalent).
150
Annual Report 2015 In 2015, the 21st edition of the Paris Climate Conference
luntary emissions reduction market, which is intended for
(COP21), a part of the United Nations Framework on Cli-
parties (e.g. companies, institutions, end users, etc.) who
mate Change, had the goal of involving the signing nations
intend to monitor or neutralize the carbon footprint of their
in joint efforts to reduce climate-changing emissions over
various (internal and external) activities (e.g. publications,
the long term.
The agreement reached among the nations calls for main-
taining the temperature increase to within 2 °C above pre-
products and services, events, etc.). All of these initiatives
are associated with the “CO2 NEUTRAL” trademark that
Enel registered in 2011.
industrial levels and seeking to remain below 1.5 °C, which
In 2015, specific emissions of nitrogen oxides remained vir-
could be achieved by reaching peak emissions as soon as
tually constant, while particulates and specific water con-
possible and achieving carbon neutrality by the second half
sumption declined by 30% and 6.3%, respectively, from
of this century.
2014, both of which are levels reached five years ahead of
For the occasion, Enel promoted numerous initiatives in
the targets set for 2020. Given this encouraging performan-
support of the agreement and in recognition of the central
ce, Enel will now be considering setting new medium-term
importance for global energy companies to take responsibi-
targets in these areas.
lity for combatting climate change. For years now, we have
In 2015, we posted a 10.4% increase in specific emissions
worked to reduce greenhouse-gas emissions in Europe and
of sulfur dioxide, mainly attributable to our Slovakian faci-
in all nations in which we operate and have implemented
lities.
a long-term strategy to achieve carbon neutrality by 2050,
A key element of our environmental policy is the gradual
thereby helping to achieve the UN’s 13th Sustainable De-
application of our internationally recognized Environmental
velopment Goal (SDG) by taking urgent action to combat
Management Systems to all Enel Group operations.
climate change and its effects.
This includes ISO 14001 certification, which currently co-
Enel is seeking to achieve long-term decarbonization by
vers roughly 97.6% of net efficient capacity, increasing
continuing to develop renewable energy as a part of our
from 2014 thanks to the installed capacity of the Enel Green
generation mix.
Power Group and the divestment of marginal plants mainly
In 2015, on the back of the positive results achieved in the
in Italy. The remaining 2.4% is attributable to a number of
reduction of CO2 emissions in previous years, Enel has set
new targets for 2020 as a part of our 2016 plan, making
plants being added to the long-term divestment program
and to new installed capacity in India and Uruguay in 2015,
the shift from a reduction of 18% to the more challenging
which will be added to the certification program in 2016.
target of 25% compared to 2007 (thereby lowering the th-
In addition to the environmental management systems,
reshold from <380 CO2 g/kWh to <350 CO2 g/kWh).
Compared to 2014, 2015 saw an increase of 3.5% in CO2
emissions, a temporary phenomenon caused by a greater
opportunities for improvement and priority areas for action
are identified with the help of the Mapping of Environmen-
tal Compliance (MAPEC) methodology, which makes it
use of thermal-power generation made necessary in order
possible to map the main areas of development in envi-
to offset, together with wind power, a decline in hydroelec-
ronmental governance.
tric power due to low levels of rain during the year.
In the nuclear power field, Enel is publicly committed to
Today, over 45% of the power Enel generates comes from
ensuring that our plants adopt a clear nuclear safety policy
zero-emission sources.
and that those facilities are operated so as to ensure ab-
In 2015, Enel Green Power installed approximately 870
solute priority for safety and protection of employees, the
MW of new wind-power capacity, primarily in the United
general public, and the environment.
States, Mexico, Brazil and, more recently, in Uruguay, to
Enel’s nuclear safety policy, which was approved in 2010
reach a total installed renewable-energy capacity of 37,033
and is published on the corporate website, promotes excel-
MW, which represents 41% of the total capacity of our ge-
lence in all plant operations, adopting a rationale that goes
neration assets.
beyond mere regulatory compliance and seeks instead to
This confirms the Group’s ongoing commitment to deve-
ensure the adoption of management approaches that incor-
loping carbon-free power generation, as presented in our
porate the principles of continuous improvement and safe
strategic plan in November, and to reaching 52% of total
management of risks.
capacity by 2019.
For a number of years, Enel has also been active on the vo-
151
Report on operationsAnnual Report 2015 Water resource management
Vendor management
Water is an essential part of electricity generation, and Enel
In conducting business and managing relationships with
is fully aware that the availability of this resource is seen
suppliers, Enel is inspired by the principles contained in the
as being a critical part of future energy scenarios. Enel has
Code of Ethics, the Zero-Tolerance-of-Corruption Plan, the
long sought to enhance the efficiency of its management
Compliance Model under Legislative Decree 231/2001, and
of the water we use, and we conduct ongoing monitoring
our Human Rights Policy.
of all power plants located in areas threatened by water
Enel awards procurement contracts for works, services
scarcity at the following levels of analysis:
and supplies in accordance with the provisions of law and
> mapping of the production sites located in vulnerable
with the principles of cost-effectiveness, fairness, compe-
areas in terms of water availability;
titiveness, and disclosure and following procurement pro-
> identification of “critical” production sites, i.e. those
cedures that ensure the utmost transparency, objectivity,
with fresh water supplies;
and equality of treatment for all participating firms. Speci-
> adaptations to plans or processes aimed at maximizing
fic standards of sustainability are also called for within the
the use of waste water and sea water;
qualification process, in procurement decisions, in contract
> monitoring of climate and vegetation data for each site.
language, and in the procedures for verifying the perfor-
Globally, Enel returns roughly 99% of the water used, and
mance of vendors.
only about 5% of the Group’s total production uses and/or
In 2015, we defined and adopted new procedures for ve-
consumes fresh water in water-stressed areas.
rifying the “requirements of professionalism” of suppliers
In 2015, in line with the goal of reducing consumption by
aimed at strengthening the existing system of controls by
10% by 2020, overall water consumption totaled 174 million
way of more incisive efforts to combat corruption, specific
cubic meters, a reduction of 6% compared to 2014 due to
criteria for analyzing documentation, verification procedu-
an increase in operations for more efficient thermal power
res, and the promotion of a culture of respecting rules and
plants. Specific consumption in 2015 came to 0.60 l/kWh,
of ethical conduct.
a reduction of 6.3% from 2014, thereby reaching, ahead
Enel has implemented a supplier-qualification system that
of schedule, Enel’s goal of reducing water consumption by
includes a detailed assessment of companies wanting to
10% from its 2010 level by 2020.
participate in provisioning processes. This system is a sort
Preserving biodiversity
of guarantee for Enel in that it provides an up-to-date list of
suppliers with a certain (legal, financial, technical, organiza-
tional, ethical, and safety-related) reliability, and it enables
Preserving biodiversity is one of the strategic objectives of
suppliers, in accordance with applicable laws and regula-
Enel’s environmental policy.
tions, to be involved in the Group’s calls for tender. Worker
The Group promotes projects in the various areas in which
health and safety and respect for the environment are im-
we operate in order to help protect local species, their natu-
portant requirements within the supplier qualification pro-
ral habitats, and the local ecosystems in general.
cess. In particular, for all product groups involved in works
These projects cover a vast range of areas, including: mo-
to be contracted out, suppliers are assessed on the basis of
nitoring; programs and projects to protect specific species;
the Safety Index, which considers the organizational arran-
methodological research and other studies; repopulation
gements of the supplier that are intended to ensure com-
and reforestation; the construction of infrastructure sup-
pliance with the relevant standards and oversight (including
port to promote the presence and activities of various spe-
OHSAS 18001 certification). For product groups with an
cies (e.g. artificial nests along power-distribution lines).
environmental impact, suppliers must also implement an
In 2015, Group biodiversity policies were established which
ISO 14000-compliant environmental management system.
define a number of principles to be followed during project
In 2015, we launched Project Sustainable Supply Chain in
selection and execution throughout the various levels in the
collaboration with the Procurement and Sustainability areas
chain of responsibility.
152
in order to standardize supplier selection and assessment
throughout the Enel Group in terms of environmental im-
pact, safety, and the respect of human rights.
In our procurement contracts for works, services and
Annual Report 2015 supplies, Enel requires contractors and subcontractors,
reserves the right to carry out control and monitoring activi-
through specific conditions in Group contracts, to respect
ties in relation to vendors and to terminate contracts in the
and protect internationally recognized human rights and
event of violations.
to respect ethical and social obligations concerning: child
Finally, in January 2015, Enel established a single, global re-
labor and protection of women, equal treatment, non-di-
gistration point for suppliers and for all Enel Group compa-
scrimination, freedom to unionize, freedom of association
nies. This represents a single interface for the entire global
and representation, prevention of forced labor, safety and
procurement community (PortalOne). This system enables
environmental protection requirements, health and sanitary
suppliers to interact with all companies of the Enel Group
conditions and conditions concerning work rules, pay, so-
in real time and to access all available services, including:
cial security contributions, insurance and taxes.
responding to invitations to tender, managing their qualifi-
In order to ensure compliance with these obligations, Enel
cation process, viewing their own vendor rating, etc.
153
Report on operationsAnnual Report 2015 Related parties
As an operator in the field of generation, distribution, tran-
directly or indirectly controlled by the Italian State, the
sport and sale of electricity and the sale of natural gas,
Group’s controlling shareholder.
Enel carries out transactions with a number of companies
The table below summarizes the main types of transactions carried out with such counterparties.
Related party
Relationship
Nature of main transactions
Acquirente Unico - Single Buyer
Fully controlled (indirectly) by the Ministry for the
Economy and Finance
Purchase of electricity for the enhanced
protection market
GME - Energy Markets Operator
Fully controlled (indirectly) by the Ministry for the
Economy and Finance
Sale of electricity on the Power Exchange
Purchase of electricity on the Power Exchange
for pumping and plant planning
GSE - Energy Services Operator
Fully controlled (directly) by the Ministry for the
Economy and Finance
Sale of subsidized electricity
Payment of A3 component for renewable
resource incentives
Terna
Eni Group
Finmeccanica Group
Poste Italiane Group
Indirectly controlled by the Ministry for the
Economy and Finance
Sale of electricity on the Ancillary Services
Market
Purchase of transport, dispatching and metering
services
Directly controlled by the Ministry
for the Economy and Finance
Sale of electricity transport services
Purchase of fuels for generation plants, storage
services and natural gas distribution
Directly controlled by the Ministry for the
Economy and Finance
Purchase of IT services and supply of goods
Fully controlled (directly) by the Ministry
for the Economy and Finance
Purchase of postal services
Finally, Enel also maintains relationships with the pension
are determined by the Authority for Electricity, Gas and the
funds FOPEN and FONDENEL, Fondazione Enel and Enel
Water System.
Cuore, an Enel non-profit company devoted to providing
social and healthcare assistance.
For more details on transactions with related parties, plea-
All transactions with related parties were carried out on
se see the discussion in note 47 to the consolidated finan-
normal market terms and conditions, which in some cases
cial statements.
154
Annual Report 2015 Reconciliation of shareholders’
equity and net income of Enel
SpA and the corresponding
consolidated figures
Pursuant to CONSOB Notice DEM/6064293 of July 28,
results for the year and shareholders’ equity with the corre-
2006, the following table provides a reconciliation of Group
sponding figures for the Parent Company.
Millions of euro
Income
statement
Shareholders’
equity
Income
statement
Shareholders’
equity
at Dec. 31, 2015
at Dec. 31, 2014
Financial statements - Enel SpA
1,011
24,880
558
25,136
Carrying amount and impairment adjustments of consolidated equity
investments and equity investments accounted for using the equity
method
Shareholders’ equity and net income (calculated using harmonized
accounting policies) of the consolidated companies and groups and
those accounted for using the equity method, net of non-controlling
interests
Translation reserve
Consolidation differences at the Group consolidation level
13,510
(69,180)
(3,211)
(82,169)
(9,287)
-
(13)
67,680
(1,956)
9,281
20,710
-
(890)
Intercompany dividends
(2,737)
-
(15,715)
Elimination of unrealized intercompany profits, net of tax effects and
other minor adjustments
TOTAL SHAREHOLDERS OF THE PARENT COMPANY
NON-CONTROLLING INTERESTS
CONSOLIDATED FINANCIAL STATEMENTS
(288)
2,196
1,176
3,372
1,671
32,376
19,375
51,751
(935)
517
255
772
79,257
(1,321)
9,294
-
1,309
31,506
19,639
51,145
155
Report on operationsAnnual Report 2015 156
Annual Report 2015 Consolidated financial
statements
157
Report on operationsAnnual Report 2015 Financial statements
Consolidated income statement
Millions of euro
Notes
2015
2014
of which with
related parties
of which with
related parties
5,751
367
7,595
2,440
53
46
23
28
7.a
7.b
[Subtotal]
8.a
8.b
8.c
8.d
8.e
8.f
[Subtotal]
9
10
11
10
11
12
13
14
14
14
14
73,076
2,582
75,658
37,644
16,457
5,313
7,612
2,654
(1,539)
68,141
168
7,685
2,455
1,563
1,505
4,969
52
5,281
1,909
3,372
-
3,372
2,196
1,176
0.23
0.23
0.23
0.23
5,583
314
7,089
2,431
54
(24)
15
29
73,328
2,463
75,791
36,928
17,179
4,864
12,670
2,362
(1,524)
72,479
(225)
3,087
2,078
1,248
916
5,540
(35)
(78)
(850)
772
-
772
517
255
0.05
0.05
0.05
0.05
Revenue
Revenue from sales and services
Other revenue and income
Costs
Electricity, gas and fuel purchases
Services and other materials
Personnel
Depreciation, amortization and impairment losses
Other operating expenses
Capitalized costs
Net income/(expense) from commodity contracts
measured at fair value
Operating income
Financial income from derivatives
Other financial income
Financial expense from derivatives
Other financial expense
Share of income/(losses) of equity investments
accounted for using the equity method
Income before taxes
Income taxes
Net income from continuing operations
Net income from discontinued operations
Net income for the year (shareholders of the Parent
Company and non-controlling interests)
Attributable to shareholders of the Parent Company
Attributable to non-controlling interests
Basic earnings/(loss) per share attributable to
shareholders of the Parent Company (euro)
Diluted earnings/(loss) per share attributable to
shareholders of the Parent Company (euro)
Basic earnings/(loss) per share from continuing
operations attributable to shareholders of the Parent
Company (euro)
Diluted earnings/(loss) per share from continuing
operations attributable to shareholders of the Parent
Company (euro)
158
Annual Report 2015
Statement of consolidated
comprehensive income for the year
Millions of euro
Notes
Net income for the year
Other comprehensive income recyclable to profit or loss
Effective portion of change in the fair value of cash flow hedges
Share of the other comprehensive income of equity investments accounted for using the
equity method
Change in the fair value of financial assets available for sale
Change in translation reserve
Other comprehensive income not recyclable to profit or loss
Remeasurement of net employee benefit liabilities/(assets)
Total other comprehensive income/(loss) for the year
32
Total comprehensive income/(loss) for the year
Attributable to:
- shareholders of the Parent Company
- non-controlling interests
2015
3,372
359
29
25
(1,743)
184
(1,146)
2,226
2,191
35
2014
772
(347)
(13)
(23)
(717)
(307)
(1,407)
(635)
(205)
(430)
159
Consolidated financial statementsAnnual Report 2015
Consolidated balance sheet
at Dec. 31, 2015
at Dec. 31, 2014
of which with
related parties
of which with
related parties
Notes
15
18
19
20
21
22
23
24
25
73,307
144
15,235
13,824
7,386
607
2,343
3,274
877
[Total]
116,997
26
27
23
28
29
[Total]
30
2,904
12,797
636
5,073
2,381
2,898
10,639
37,328
6,854
161,179
937
2
135
73,089
143
16,612
14,027
7,067
872
1,335
3,645
885
117,675
3,334
12,022
788
5,500
3,984
3,465
13,088
42,181
6,778
166,634
1,220
142
Millions of euro
ASSETS
Non-current assets
Property, plant and equipment
Investment property
Intangible assets
Goodwill
Deferred tax assets
Equity investments accounted for
using the equity method
Derivatives
Other non-current financial assets
Other non-current assets
Current assets
Inventories
Trade receivables
Income tax receivables
Derivatives
Other current financial assets
Other current assets
Cash and cash equivalents
Assets classified as held for sale
TOTAL ASSETS
160
Annual Report 2015
Millions of euro
Notes
LIABILITIES AND SHAREHOLDERS’ EQUITY
at Dec. 31, 2015
at Dec. 31, 2014
of which with
related parties
of which with
related parties
Equity attributable to the shareholders of the
Parent Company
Share capital
Reserves
Retained earnings/(Loss carried forward)
Non-controlling interests
Total shareholders’ equity
Non-current liabilities
Long-term borrowings
Employee benefits
Provisions for risks and charges - non-current
Deferred tax liabilities
Derivatives
Other non-current liabilities
Current liabilities
Short-term borrowings
Current portion of long-term borrowings
Provisions for risk and charges - current
Trade payables
Income tax payable
Derivatives
Other current financial liabilities
Other current liabilities
Liabilities included in disposal groups
classified as held for sale
Total liabilities
TOTAL LIABILITIES AND SHAREHOLDERS’
EQUITY
9,403
3,352
19,621
32,376
19,375
51,751
44,872
2,284
5,192
8,977
1,518
1,549
[Total]
32
33
34
35
21
23
36
[Total]
64,392
2,155
5,733
1,630
33
33
35
37
23
38
40
[Total]
31
9,403
3,362
18,741
31,506
19,639
51,145
48,655
3,687
4,051
9,220
2,441
1,464
69,518
3,252
5,125
1,187
4
24
2
11,775
2,911
13,419
3,159
585
5,509
1,063
11,222
39,672
5,364
109,428
161,179
14
253
5,441
1,177
10,827
40,681
5,290
115,489
166,634
3
161
Consolidated financial statementsAnnual Report 2015
Statement of changes in consolidated
shareholders’ equity
Share capital and reserves attributable to the shareholders of the Parent Company
Share
capital
Share
premium
reserve
Legal
reserve
Other
reserves
Reserve from
translation
of financial
statements
in currencies
other than
euro
Reserve from
measurement
of cash flow
hedge financial
instruments
Reserve from
measurement
of financial
instruments AFS
Reserve
from equity
Reserve from
Reserve from
investments
remeasurement
disposal of
Reserve from
Equity
attributable to
accounted for
of net defined
equity interests
transactions in
Retained
the shareholders
using the equity
benefit plan
without loss of
non-controlling
earnings/(Loss
of the Parent
Non-controlling
shareholders’
method
liabilities/(assets)
control
interests
carried forward)
Company
interests
At January 1, 2014
9,403
5,292
1,881
2,262
(1,084)
(1,592)
128
(58)
(528)
721
62
Dividends and interim dividends
Transactions in non-controlling
interests
Change in scope of consolidation
Comprehensive income for the period
of which:
- other comprehensive income/(loss)
for the period
- net income/(loss) for the period
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
6
(243)
(243)
-
-
-
21
(235)
(235)
-
At December 31, 2014
9,403
5,292
1,881
2,262
(1,321)
(1,806)
Dividends and interim dividends
Transactions in non-controlling
interests
Change in scope of consolidation
Comprehensive income for the period
of which:
- other comprehensive income/(loss)
for the period
- net income/(loss) for the period
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(635)
465
(635)
-
465
-
At December 31, 2015
9,403
5,292
1,881
2,262
(1,956)
(1,341)
-
-
-
(23)
(23)
-
105
-
-
-
25
25
-
130
162
-
-
3
-
-
-
-
(2,831)
(255)
(3)
(19)
59
(202)
(19)
(202)
(74)
(671)
(2,113)
(193)
(2)
(3)
120
20
-
(54)
(551)
(2,115)
(196)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
19,454
(1,222)
-
(8)
517
517
18,741
(1,316)
-
-
-
-
2,196
19,621
35,941
(1,222)
(3,086)
78
(205)
-
(722)
517
31,506
(1,316)
(5)
-
(5)
2,196
32,376
16,891
(1,541)
5,385
(666)
(430)
(685)
255
19,639
(767)
469
(1)
35
(1,141)
1,176
19,375
20
120
2,196
2,191
Total
equity
52,832
(2,763)
2,299
(588)
(635)
(1,407)
772
51,145
(2,083)
464
(1)
2,226
(1,146)
3,372
51,751
Annual Report 2015
Share capital and reserves attributable to the shareholders of the Parent Company
Reserve from
translation
Share
capital
Share
premium
reserve
of financial
Reserve from
statements
measurement
Reserve from
in currencies
of cash flow
measurement
Legal
Other
other than
hedge financial
of financial
reserve
reserves
euro
instruments
instruments AFS
Reserve
from equity
investments
accounted for
using the equity
method
Reserve from
remeasurement
of net defined
benefit plan
liabilities/(assets)
Reserve from
disposal of
equity interests
without loss of
control
Reserve from
transactions in
non-controlling
interests
Retained
earnings/(Loss
carried forward)
Equity
attributable to
the shareholders
of the Parent
Company
Non-controlling
interests
Total
shareholders’
equity
At January 1, 2014
9,403
5,292
1,881
2,262
(1,084)
(1,592)
128
(58)
(528)
Statement of changes in consolidated
shareholders’ equity
At December 31, 2014
9,403
5,292
1,881
2,262
(1,321)
(1,806)
Dividends and interim dividends
Transactions in non-controlling
interests
Change in scope of consolidation
Comprehensive income for the period
of which:
- other comprehensive income/(loss)
for the period
- net income/(loss) for the period
Dividends and interim dividends
Transactions in non-controlling
interests
Change in scope of consolidation
of which:
- other comprehensive income/(loss)
for the period
- net income/(loss) for the period
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
6
-
-
-
-
-
(243)
21
(235)
(243)
(235)
(635)
465
-
-
-
-
-
-
-
At December 31, 2015
9,403
5,292
1,881
2,262
(1,956)
(1,341)
(23)
(23)
105
-
-
-
-
-
-
-
25
-
130
Comprehensive income for the period
(635)
465
25
20
120
-
-
3
(19)
(19)
-
(74)
-
-
-
20
-
(54)
721
-
62
-
19,454
(1,222)
(671)
(2,113)
(193)
-
-
59
(202)
(202)
-
-
-
-
120
-
(2,831)
(255)
(3)
-
-
-
-
-
-
-
-
(2)
-
-
-
-
-
(3)
-
-
-
-
(551)
(2,115)
(196)
35,941
(1,222)
(3,086)
78
(205)
-
(722)
517
31,506
(1,316)
(5)
-
-
(8)
517
-
517
18,741
(1,316)
-
-
2,196
2,191
-
2,196
19,621
(5)
2,196
32,376
16,891
(1,541)
5,385
(666)
(430)
(685)
255
19,639
(767)
469
(1)
35
(1,141)
1,176
19,375
52,832
(2,763)
2,299
(588)
(635)
(1,407)
772
51,145
(2,083)
464
(1)
2,226
(1,146)
3,372
51,751
163
Consolidated financial statementsAnnual Report 2015
Consolidated statement of cash flows
Millions of euro
Notes
2015
2014
of which
with related
parties
of which
with related
parties
Income before taxes for the year
Adjustments for:
Amortization and impairment losses of intangible assets
Depreciation and impairment losses of property, plant and equipment
Financial (income)/expense
Interest and other financial income received
Interest and other financial expense paid
(Gains)/Losses from disposals and other non-monetary items
Taxes paid
Accruals to provisions
Exchange rate adjustments of foreign currency assets and liabilities
(including cash and cash equivalents)
Changes in net current assets:
- inventories
- trade receivables
- trade payables
- provisions
- other assets and liabilities
Cash flows from operating activities (A)
Investments in property, plant and equipment
Investments in intangible assets
Investments in entities (or business units) less cash and cash equivalents acquired
Disposals of entities (or business units) less cash and cash equivalents sold
(Increase)/Decrease in other investing activities
Cash flows from investing/disinvesting activities (B)
Financial debt (new long-term borrowing)
Financial debt (repayments and other changes in net financial debt)
Transactions in non-controlling interest
Transaction costs in the disposal of equity interests without loss of control
Dividends and interim dividends paid
Cash flows from financing activities (C)
Impact of exchange rate fluctuations on cash and cash equivalents (D)
Increase/(Decrease) in cash and cash equivalents (A+B+C+D)
Cash and cash equivalents at the beginning of the period (1)
Cash and cash equivalents at the end of the period (2)
5,281
770
6,002
2,246
1,715
(4,326)
(412)
8.d
8.d
11
11
11
13
(1,516)
15
(29)
1,448
856
(2,492)
274
(2,329)
(581)
(1,243)
1,387
9,572
(7,000)
(762)
(78)
1,350
69
(6,421)
1,474
(5,015)
456
-
26
27
37
35
15
19
5
5
33
33
32
32
(2,297)
(5,382)
(234)
(2,465)
13,255
10,790
23
(28)
(78)
1,709
10,212
2,581
1,326
(4,043)
(610)
(1,396)
911
1,285
(1,839)
(102)
283
(1,283)
(248)
1,311
58
(549)
(1,773)
(6)
9
39
10,058
(6,021)
(680)
(73)
312
325
(6,137)
4,582
(2,400)
1,977
(50)
(2,573)
1,536
(102)
5,355
7,900
13,255
(1) Of which cash and cash equivalents equal to €13,088 million at January 1, 2015 (€7,873 million at January 1, 2014), short-term securities equal to €140
million at January 1, 2015 (€17 million at January 1, 2014) and cash equivalents pertaining to “Assets held for sale” equal to €27 million at January 1, 2015
(€10 million at January 1, 2014).
(2) Of which cash and cash equivalents equal to €10,639 million at December 31, 2015 (€13,088 million at December 31, 2014), short-term securities equal
to €1 million at December 31, 2015 (€140 million at December 31, 2014) and cash equivalents pertaining to “Assets held for sale” equal to €150 million at
December 31, 2015 (€27 million at December 31, 2014).
164
Annual Report 2015
Notes to the consolidated
financial statements
1
Form and content of the
financial statements
paragraph 3, of Legislative Decree 38 of February 28, 2005.
The consolidated financial statements consist of the con-
solidated income statement, the statement of consolidated
comprehensive income, the consolidated balance sheet, the
statement of changes in consolidated shareholders’ equity
and the consolidated statement of cash flows and the rela-
Enel SpA has its registered office in Viale Regina Margherita
ted notes.
137, Rome, Italy, and since 1999 has been listed on the Milan
The assets and liabilities reported in the consolidated balance
Stock Exchange. Enel is an energy multinational and is one
sheet are classified on a “current/non-current basis”, with se-
of the world’s leading integrated operators in the electricity
parate reporting of assets held for sale and liabilities included
and gas industries, with a special focus on Europe and Latin
in disposal groups held for sale. Current assets, which include
America.
cash and cash equivalents, are assets that are intended to
The consolidated financial statements for the period ended
be realized, sold or consumed during the normal operating
December 31, 2015 comprise the financial statements of
cycle of the Group or in the 12 months following the balance
Enel SpA, its subsidiaries and Group holdings in associates
sheet date; current liabilities are liabilities that are expected to
and joint ventures, as well as the Group’s share of the as-
be settled during the normal operating cycle of the Group or
sets, liabilities, costs and revenue of joint operations (“the
within the 12 months following the close of the financial year.
Group”). A list of the subsidiaries, associates, joint opera-
The consolidated income statement is classified on the basis
tions and joint ventures included in the scope of consolida-
of the nature of costs, with separate reporting of net income/
tion is attached.
(loss) from continuing operations and net income (loss) from
The consolidated financial statements were approved for pu-
discontinued operations attributable to shareholders of the
blication by the Board of Directors on March 22, 2016.
Parent Company and to non-controlling interests.
These financial statements have been audited by Reconta
The indirect method is used for the consolidated cash flow
Ernst & Young SpA.
Basis of presentation
statement of cash flows, with separate reporting of any cash
flows by operating, investing and financing activities associa-
ted with discontinued operations.
In particular, although the Group does not diverge from the
The consolidated financial statements for the year ended
provisions of IAS 7 in the classification of items:
December 31, 2015 have been prepared in accordance with
> cash flows from operating activities report cash flows
international accounting standards (International Accounting
from core operations, interest on loans granted and
Standards - IAS and International Financial Reporting Stan-
obtained and dividends received from joint ventures or
dards - IFRS) issued by the International Accounting Stan-
associates;
dards Board (IASB), the interpretations of the International
> investing/disinvesting activities comprise investments in
Financial Reporting Interpretations Committee (IFRIC) and
property, plant and equipment and intangible assets and
the Standing Interpretations Committee (SIC), recognized in
disposals of such assets, including the effects of business
the European Union pursuant to Regulation 2002/1606/EC
combinations in which the Group acquires or loses con-
and in effect as of the close of the year. All of these stan-
trol of companies, as well as other minor investments;
dards and interpretations are hereinafter referred to as the
> cash flows from financing activities include cash flows
“IFRS-EU”.
generated by liability management transactions, dividen-
The financial statements have also been prepared in confor-
ds paid to non-controlling interests by the Parent Com-
mity with measures issued in implementation of Article 9,
pany or other consolidated companies and the effects of
165
Consolidated financial statementsAnnual Report 2015 transactions in non-controlling interests that do not chan-
involves both the current and future periods, the change is
ge the status of control of the companies involved;
recognized in the period in which the revision is made and in
> a separate item is used to report the impact of exchange
the related future periods.
rates on cash and cash equivalents and their impact on
In order to enhance understanding of the financial state-
profit or loss is eliminated in full in order to neutralize the
ments, the following sections examine the main items af-
effect on cash flows from operating activities.
fected by the use of estimates and the cases that reflect
For more information on cash flows as reported in the state-
management judgments to a significant degree, undersco-
ment of cash flows, please see the note on “cash flows” in
ring the main assumptions used by managers in measuring
the report on operations.
these items in compliance with the IFRS-EU. The critical
The income statement, the balance sheet and the statement
element of such valuations is the use of assumptions and
of cash flows report transactions with related parties, the de-
professional judgments concerning issues that are by their
finition of which is given in the next section below.
very nature uncertain.
The consolidated financial statements have been prepared
Changes in the conditions underlying the assumptions and
on a going concern basis using the cost method, with the
judgments could have a substantial impact on future results.
exception of items measured at fair value in accordance with
IFRS, as explained in the measurement bases applied to each
Use of estimates
individual item, and of non-current assets and disposal groups
classified as held for sale, which are measured at the lower of
their carrying amount and fair value less costs to sell.
The consolidated financial statements are presented in euro,
the functional currency of the Parent Company Enel SpA. All
figures are shown in millions of euro unless stated otherwise.
The consolidated financial statements provide comparative
information in respect of the previous period.
2
Accounting policies and
measurement criteria
Use of estimates and management
judgment
Revenue recognition
Revenue from sales to customers is recognized on an accruals
basis on the basis of the fair value of the services provided.
Revenue from sales of electricity and gas to retail customers
is recognized at the time the electricity or gas is supplied
and includes, in addition to amounts invoiced on the basis of
periodic meter readings (pertaining to the year), an estimate
of the value of electricity and gas sold during the period but
not yet invoiced, which is equal to the difference between
the amount of electricity and gas delivered to the distribu-
tion network and that invoiced in the period, taking account
of any network losses. Revenue between the date of the
last meter reading and the end of the year is based on esti-
mates of the daily consumption of individual customers cal-
culated on the basis of their consumption record, adjusted
to take account of weather conditions and other factors that
may affect estimated consumption.
Revenue from the transport of electricity is recognized when
Preparing the consolidated financial statements under IFRS-
the services are rendered to distribution customers even if
EU requires management to take decisions and make esti-
they have not yet been invoiced. That revenue is determi-
mates and assumptions that may impact the value of reve-
ned on the basis of the amounts that have actually transi-
nues, costs, assets and liabilities and the related disclosures
ted along the distribution network, net of estimated losses.
concerning the items involved as well as contingent assets
Where provided for in the specific local regulations, such
and liabilities at the balance sheet date. The estimates and
revenue is adjusted to take account of the restrictions and
management’s judgments are based on previous expe-
mandatory rates established by the Authority for Electricity,
rience and other factors considered reasonable in the cir-
Gas and the Water System in Italy or the equivalent national
cumstances. They are formulated when the carrying amount
organizations in other countries. Where the inclusion of in-
of assets and liabilities is not easily determined from other
vestments in rates, which gives rise to the operator’s right
sources. The actual results may therefore differ from these
to receive the amount, in the year in which they are carried
estimates. The estimates and assumptions are periodically
out is already virtually certain, the corresponding revenue is
revised and the effects of any changes are reflected through
recognized on an accrual basis on the basis of a preliminary
profit or loss if they only involve that period. If the revision
estimate of the investments carried out during the year.
166
Annual Report 2015 Pension plans and other post-employment benefits
Depreciable value of certain elements of Italian hydroe-
Some of the Group’s employees participate in pension plans
lectric plants subsequent to enactment of Law 134/2012
offering benefits based on their wage history and years of
Law 134 of August 7, 2012 containing “urgent measures for
service.
growth” (published in the Gazzetta Ufficiale of August 11,
Certain employees are also eligible for other post-em-
2012, introduced a sweeping overhaul of the rules governing
ployment benefit schemes.
hydroelectric concessions. Among its various provisions, the
The expenses and liabilities of such plans are calculated on
law establishes that five years before the expiration of a ma-
the basis of estimates carried out by consulting actuaries,
jor hydroelectric water diversion concession and in cases of
who use a combination of statistical and actuarial elements
lapse, relinquishment or revocation, where there is no prevai-
in their calculations, including statistical data on past years
ling public interest for a different use of the water, incompati-
and forecasts of future costs.
ble with its use for hydroelectric generation, the competent
Other components of the estimation that are considered in-
public entity shall organize a public call for tender for the award
clude mortality and withdrawal rates as well as assumptions
for consideration of the concession for a period ranging from
concerning future developments in discount rates, the rate
20 to a maximum of 30 years.
of wage increases, the inflation rate and trends in the cost
In order to ensure operational continuity, the law also governs
of medical care.
the methods of transfer ownership of the business unit neces-
These estimates can differ significantly from actual deve-
sary to operate the concession, including all legal relationships
lopments owing to changes in economic and market con-
relating to the concession, from the outgoing concession hol-
ditions, increases or decreases in withdrawal rates and the
der to the new concession holder, in exchange for payment
lifespan of participants, as well as changes in the effective
of a price to be determined in negotiations between the de-
cost of medical care.
parting concession holder and the grantor agency, taking due
Such differences can have a substantial impact on the quan-
account of the following elements:
tification of pension costs and other related expenses.
> for intake and governing works, penstocks and outflow
channels, which under the consolidated law governing
Recoverability of non-current assets
waters and electrical plants are to be relinquished free of
The carrying amount of non-current assets is reviewed perio-
charge (Article 25 of Royal Decree 1775 of December 11,
dically and wherever circumstances or events suggest that a
1933), the revalued cost less government capital grants,
review is necessary. Goodwill is reviewed at least annually.
also revalued, received by the concession holder for the
Such assessments of the recoverable amount of assets are
construction of such works, depreciated for ordinary wear
carried out in accordance with the provisions of IAS 36, as
and tear;
described in greater detail in note 20 below.
> for other property, plant and equipment, the market va-
In particular, the recoverable amount of non-current assets
lue, meaning replacement value, reduced by estimated
and goodwill is based on estimates and assumptions used in
depreciation for ordinary wear and tear.
order to determine the amount of cash flow and the discount
While acknowledging that the new regulations introduce im-
rates applied. Where the value of a group of non-current as-
portant changes as to the transfer of ownership of the bu-
sets is considered to be impaired, it is written down to its
siness unit with regard to the operation of the hydroelectric
recoverable value, as estimated on the basis of the use of
concession, the practical application of these principles faces
the assets and their possible future disposal, in accordance
difficulties, given the uncertainties that do not permit the for-
with the Company’s most recent approved plan.
mulation of a reliable estimate of the value that can be recove-
The factors used in the calculation of the recoverable amount
red at the end of existing concessions (residual value).
are discussed in more detail in the section “Impairment of
Accordingly, management has decided to not attempt to for-
non-financial assets”. Nevertheless, possible changes in the
mulate an estimate of residual value.
estimation of the factors on which the calculation of such
The fact that the legislation requires the new concession hol-
values is performed could generate different recoverable
der to make a payment to the departing concession holder
values. The analysis of each group of non-current assets is
prompted management to review the depreciation schedules
unique and requires management to use estimates and as-
for assets classified as to be relinquished free of charge prior
sumptions considered prudent and reasonable in the speci-
to Law 134/2012 (until the year ended on December 31, 2011,
fic circumstances.
given that the assets were to be relinquished free of charge,
167
Consolidated financial statementsAnnual Report 2015 the depreciation period was equal to the closest date betwe-
the generation, transport and distribution of electricity. In view
en the term of the concession and the end of the useful life
of the nature of such litigation, it is not always objectively pos-
of the individual asset), calculating depreciation no longer over
sible to predict the outcome of such disputes, which in some
the term of the concession but, if longer, over the economic
cases could be unfavorable.
and technical life of the individual assets. If additional informa-
Provisions have been recognized to cover all significant liabili-
tion becomes available to enable the calculation of residual
ties for cases in which legal counsel feels an adverse outcome
value, the carrying amounts of the assets involved will be
is likely and a reasonable estimate of the amount of the loss
adjusted prospectively.
can be made.
Determining the fair value of financial instruments
Obligations associated with generation plants, inclu-
The fair value of financial instruments is determined on the
ding decommissioning and site restoration
basis of prices directly observable in the market, where availa-
Generation activities may entail obligations for the operator
ble, or, for unlisted financial instruments, using specific valua-
with regard to future interventions that will have to be perfor-
tion techniques (mainly based on present value) that maximi-
med following the end of the operating life of the plant.
ze the use of observable market inputs. In rare circumstances
Such interventions may involve the decommissioning of
were this is not possible, the inputs are estimated by mana-
plants and site restoration, or other obligations linked to the
gement taking due account of the characteristics of the in-
type of generation technology involved. The nature of such
struments being measured.
obligations may also have a major impact on the accounting
In accordance with IFRS 13, the Group includes a measure-
treatment used for them.
ment of credit risk, both of the counterparty (Credit Valuation
In the case of nuclear power plants, where the costs regard
Adjustment or CVA) and its own (Debit Valuation Adjustment
both decommissioning and the storage of waste fuel and
or DVA), in order to adjust the fair value of financial instru-
other radioactive materials, the estimation of the future cost
ments for the corresponding amount of counterparty risk,
is a critical process, given that the costs will be incurred over
using the method discussed in note 45. Changes in the as-
a very long span of time, estimated at up to 100 years.
sumptions made in estimating the input date could have an
The obligation, based on financial and engineering as-
impact on the fair value recognized for those instruments.
sumptions, is calculated by discounting the expected future
cash flows that the Group considers it will have to pay to
Recovery of deferred tax assets
meet the obligations it has assumed.
At December 31, 2015, the consolidated financial statements
The discount rate used to determine the present value of the
report deferred tax assets in respect of tax losses to be re-
liability is the pre-tax risk-free rate and is based on the econo-
versed in subsequent years and income components whose
mic parameters of the country in which the plant is located.
deductibility is deferred in an amount whose recovery is con-
That liability is quantified by management on the basis of the
sidered by management to be highly probable.
technology existing at the measurement date and is reviewed
The recoverability of such assets is subject to the achieve-
each year, taking account of developments in storage, decom-
ment of future profits sufficient to absorb such tax losses and
missioning and site restoration technology, as well as the on-
to use the benefits of the other deferred tax assets.
going evolution of the legislative framework governing health
Significant management judgement is required to determine
and environmental protection.
the amount of deferred tax assets that can be recognized,
Subsequently, the value of the obligation is adjusted to reflect
based upon the likely timing and the level of future taxable
the passage of time and any changes in estimates.
profits together with future tax planning strategies and the
tax rates applicable at the date of reversal. However, where
Other
the Group should become aware that it is unable to recover
In addition to the items listed above, the use of estimates
all or part of recognized tax assets in future years, the conse-
regarded the fair value measurement of assets acquired
quent adjustment would be taken to the income statement in
and liabilities assumed in business combinations. For these
the year in which this circumstance arises.
items, the estimates and assumptions are contained in the
discussion of the accounting policies adopted.
Litigation
The Enel Group is involved in various legal disputes regarding
168
Annual Report 2015 Management judgments
Identification of cash generating units (CGUs)
In application of “IAS 36 - Impairment of assets”, the go-
odwill recognized in the consolidated financial statements of
the Group as a result of business combinations has been al-
located to individual or groups of CGUs that will benefit from
the combination. A CGU is the smallest group of assets that
generates largely independent cash inflows.
In identifying such CGUs, management took account of the
specific nature of its assets and the business in which it is
involved (geographical area, business area, regulatory fra-
mework, etc.), verifying that the cash flows of a given group
of assets were closely independent and largely autonomous
of those associated with other assets (or groups of assets).
The assets of each CGU were also identified on the basis of
the manner in which management manages and monitors
those assets within the business model adopted. For a more
extensive discussion, please see notes 4 and 5 below and
the discussion in the section on “Results by business area”
in the report on operations.
The CGUs identified by management to which the goodwill
recognized in these consolidated financial statements has
been allocated are indicated in the section on intangible as-
sets, to which the reader is invited to refer.
The number and scope of the CGUs are updated systema-
tically to reflect the impact of new business combinations
and reorganizations carried out by the Group, and to take
account of external factors that could impact the ability of
groups of assets to generate independent cash flows.
Determination of the existence of control
Under the provisions of IFRS 10, control is achieved when
the Group is exposed, or has rights, to variable returns from
its involvement with the investee and has the ability to affect
those returns through its power over the investee. Power is
defined as the current ability to direct the relevant activities
of the investee based on existing substantive rights.
The existence of control does not depend solely on owner-
ship of a majority shareholding, but rather it arises from sub-
stantive rights that each investor holds over the investee.
Consequently, management must use its judgment in as-
sessing whether specific situations determine substantive
rights that give the Group the power to direct the relevant
activities of the investee in order to affect its returns.
For the purpose of assessing control, management analyses
all facts and circumstances including any agreements with
other investors, rights arising from other contractual arrange-
ments and potential voting rights (call options, warrants, put
options granted to non-controlling shareholders, etc.). These
other facts and circumstances could be especially significant
in such assessment when the Group holds less than a majo-
rity of voting rights, or similar rights, in the investee.
Following such analysis of the existence of control, which
had already been done in previous years under the provi-
sions of the then-applicable IAS 27, the Group consolidated
certain companies (Emgesa and Codensa) on a line-by-line
basis even though it did not hold more than half of the vo-
ting rights. That approach was maintained in the assessment
carried out in application of IFRS 10 on the basis of the re-
quirements discussed above, as detailed in the attachment
“Subsidiaries, associates and other significant equity in-
vestments of the Enel Group at December 31, 2015” to the-
se financial statements.
The Group re-assesses whether or not it controls an inve-
stee if facts and circumstances indicate that there are chan-
ges to one or more of the elements considered in verifying
the existence of control.
Finally, the assessment of the existence of control did not
find any situations of de facto control.
Determination of the existence of joint control and of
the type of joint arrangement
Under the provisions of the new IFRS 11, a joint arrange-
ment is an agreement where two, or more parties, have
joint control.
Joint control exists when the decisions over the relevant ac-
tivities require the unanimous consent of at least two parties
of a joint arrangement.
A joint arrangement can be configured as a joint venture or
a joint operation. Joint ventures are joint arrangements whe-
reby the parties that have joint control have rights to the net
assets of the arrangement. Conversely, joint operations are
joint arrangements whereby the parties that have joint con-
trol have rights to the assets and obligations for the liabilities
relating to the arrangement.
In order to determine the existence of the joint control and
the type of joint arrangement, management must apply
judgment and assess its rights and obligations arising from
the arrangement. For this purpose, the management con-
siders the structure and legal form of the arrangement, the
terms agreed by the parties in the contractual arrangement
and, when relevant, other facts and circumstances.
Following that analysis, the Group has considered its interest
in Asociación Nuclear Ascó-Vandellós II as a joint operation.
The Group re-assesses whether or not it has joint control if
facts and circumstances indicate that changes have occur-
169
Consolidated financial statementsAnnual Report 2015 red in one or more of the elements considered in verifying
ling entity as Enel SpA, companies that directly or indirectly
the existence of joint control and the type of the joint arran-
through one or more intermediaries control, are controlled or
gement.
are subject to the joint control of Enel SpA and in which the
latter has a holding that enables it to exercise a significant
Determination of the existence of significant influence
influence. Related parties also include entities that operate
over an associate
post-employment benefit plans for employees of Enel SpA
Associated companies are those in which the Group exerci-
or its associates (specifically, the FOPEN and FONDENEL
ses significant influence, i.e. the power to participate in the
pension funds), as well as the members of the boards of au-
financial and operating policy decisions of the investee but
ditors, and their immediate family, and the key management
not exercise control or joint control over those policies. In
personnel, and their immediate family, of Enel SpA and its
general, it is presumed that the Group has a significant in-
subsidiaries. Key management personnel comprises mana-
fluence when it has an ownership interest of 20% or more.
gement personnel who have the power and direct or indirect
In order to determine the existence of significant influence,
responsibility for the planning, management and control of
management must apply judgment and consider all facts
the activities of the company. They include directors.
and circumstances.
The Group re-assesses whether or not it has significant in-
fluence if facts and circumstances indicate that there are
Subsidiaries
changes to one or more of the elements considered in ve-
The Group controls an entity when it is exposed/has rights
rifying the existence of significant influence.
to variable returns deriving from its involvement and has the
ability, through the exercise of its power over the investee,
Application of “IFRIC 12 - Service concession arrange-
to affect its returns. Power is defined as when the investor
ments” to concessions
has existing rights that give it the current ability to direct the
“IFRIC 12 - Service concession arrangements” applies to
relevant activities.
“public-to-private” service concession arrangements, which
The figures of the subsidiaries are consolidated on a full line-
can be defined as contracts under which the grantor tran-
by-line basis as from the date control is acquired until such
sfers to a concession holder the right to deliver public servi-
control ceases.
ces that give access to the main public facilities for a speci-
fied period of time in return for managing the infrastructure
used to deliver those public services.
Consolidation procedures
More specifically, IFRIC 12 applies to public-to-private servi-
The financial statements of subsidiaries used to prepare
ce concession arrangements if the grantor:
the consolidated financial statements were prepared at De-
> controls or regulates what services the operator must
cember 31, 2015 in accordance with the accounting policies
provide with the infrastructure, to whom it must provide
adopted by the Parent Company.
them, and at what price; and
If a subsidiary uses different accounting policies from those
> controls – through ownership or otherwise – any signifi-
adopted in preparing the consolidated financial statements
cant residual interest in the infrastructure at the end of
for similar transactions and facts in similar circumstances,
the term of the arrangement.
appropriate adjustments are made to ensure conformity
In assessing the applicability of these provisions for the
with Group accounting policies.
Group, management carefully analyzed existing conces-
Assets, liabilities, revenue and expenses of a subsidiary
sions.
acquired or disposed of during the year are included in or
On the basis of that analysis, the provisions of IFRIC 12 are
excluded from the consolidated financial statements, re-
applicable to some of the infrastructure of a number of com-
spectively, from the date the Group gains control or until the
panies in the Latin America Region that operate in Brazil (es-
date the Group ceases to control the subsidiary.
sentially Ampla and Coelce).
Profit or loss and the other components of other comprehen-
Related parties
sive income are attributed to the owners of the Parent and
non-controlling interests, even if this results in a loss for non-
controlling interests.
Related parties are mainly parties that have the same control-
All intercompany assets and liabilities, equity, income, ex-
170
Annual Report 2015 penses and cash flows relating to transactions between en-
The financial statements of the associates or joint ventures
tities of the Group are eliminated in full.
are prepared for the same reporting period as the Group.
Changes in ownership interest in subsidiaries that do not
When necessary, adjustments are made to bring the ac-
result in loss of control are accounted for as equity tran-
counting policies in line with those of the Group.
sactions, with the carrying amounts of the controlling and
After application of the equity method, the Group determi-
non-controlling interests adjusted to reflect changes in their
nes whether it is necessary to recognize an impairment loss
interests in the subsidiary. Any difference between the fair
on its investment in an associate or joint venture. If there is
value of the consideration paid or received and the corre-
such evidence, the Group calculates the amount of impai-
sponding fraction of equity acquired or sold is recognized in
rment as the difference between the recoverable amount of
consolidated equity.
the associate or joint venture and its carrying amount.
When the Group ceases to have control over a subsidiary,
If the investment ceases to be an associate or a joint venture,
any interest retained in the entity is remeasured to its fair
the Group recognizes any retained investment at its fair value,
value, recognized through profit or loss, at the date when
through profit or loss. Any amounts previously recognized in
control is lost. In addition, any amounts previously recogni-
other comprehensive income in respect of the former asso-
zed in other comprehensive income in respect of the former
ciate or joint venture are accounted for as if the Group had
subsidiary are accounted for as if the Group had directly di-
directly disposed of the related assets or liabilities.
sposed of the related assets or liabilities.
If the Group’s ownership interest in an associate or a joint
Investments in joint arrangements
and associates
venture is reduced, but the Group continues to exercise a
significant influence or joint control, the Group continues to
apply the equity method and the share of the gain or loss that
had previously been recognized in other comprehensive inco-
A joint venture is an entity over which the Group exercises
me relating to that reduction is accounted for as if the Group
joint control and has rights to the net assets of the arrange-
had directly disposed of the related assets or liabilities.
ment. Joint control is the sharing of control of an arrange-
When a portion of an investment in an associate or joint
ment, whereby decisions about the relevant activities requi-
venture meets the criteria to be classified as held for sale,
re unanimous consent of the parties sharing control.
any retained portion of an investment in the associate or
An associate is an entity over which the Group has significant
joint venture that has not been classified as held for sale is
influence. Significant influence is the power to participate in
accounted for using the equity method until disposal of the
the financial and operating policy decisions of the investee
portion classified as held for sale takes place.
without having control or joint control over the investee.
Joint operations are joint arrangements whereby the parties
The Group’s investments in its joint ventures and associates
that have joint control have rights to the assets and obliga-
are accounted for using the equity method.
tions for the liabilities relating to the arrangement. For each
Under the equity method, these investments are initially re-
joint operation, the Group recognized assets, liabilities, costs
cognized at cost and any goodwill arising from the difference
and revenue on the basis of the provisions of the arrange-
between the cost of the investment and the Group’s share
ment rather than the participating interest held.
of the net fair value of the investee’s identifiable assets and
liabilities at the acquisition date is included in the carrying
amount of the investment. Goodwill is not individually te-
sted for impairment.
Translation of foreign currency
items
After the acquisition date, their carrying amount is adjusted
Transactions in currencies other than the functional currency
to recognize changes in the Group’s share of profit or loss of
are recognized in these financial statements at the exchan-
the associate or joint venture. The OCI of such investees is
ge rate prevailing on the date of the transaction. Monetary
presented as specific items of the Group’s OCI.
assets and liabilities denominated in a foreign currency other
Distributions received from joint venture and associates re-
than the functional currency are later adjusted using the ba-
duce the carrying amount of the investments.
lance sheet exchange rate. Non-monetary assets and liabi-
Profits and losses resulting from transactions between the
lities in foreign currency stated at cost are translated using
Group and the associates or joint ventures are eliminated to
the exchange rate prevailing on the date of initial recognition
the extent of the interest in the associate or joint venture.
of the transaction. Non-monetary assets and liabilities in fo-
171
Consolidated financial statementsAnnual Report 2015 reign currency stated at fair value are translated using the
the fair value of the net assets acquired previously was re-
exchange rate prevailing on the date that value was determi-
cognized in equity; the amount of goodwill was determined
ned. Any exchange rate differences are recognized through
for each transaction separately based on the fair values of
profit or loss.
the acquiree’s net assets at the date of each exchange tran-
saction.
Translation of financial statements
denominated in a foreign currency
Business combinations carried out as from January 1, 2010
are recognized on the basis of IFRS 3 (2008), which is refer-
For the purposes of the consolidated financial statements,
red to as IFRS 3 Revised hereafter.
all profits/losses, assets and liabilities are stated in euro,
More specifically, business combinations are recognized
which is the functional currency of the Parent Company,
using the acquisition method, where the purchase cost
Enel SpA.
(the consideration transferred) is equal to the fair value at
In order to prepare the consolidated financial statements,
the purchase date of the assets acquired and the liabilities
the financial statements of consolidated companies in fun-
incurred or assumed, as well as any equity instruments is-
ctional currencies other than the presentation currency
sued by the purchaser. The consideration transferred inclu-
used in the consolidated financial statements are translated
des the fair value of any asset or liability resulting from a
into euro by applying the relevant period-end exchange rate
contingent consideration arrangement.
to the assets and liabilities, including goodwill and consoli-
Costs directly attributable to the acquisition are recognized
dation adjustments, and the average exchange rate for the
through profit or loss.
period, which approximates the exchange rates prevailing
This cost is allocated by recognizing the assets, liabilities
at the date of the respective transactions, to the income
and identifiable contingent liabilities of the acquired com-
statement items.
pany at their fair values as at the acquisition date. Any po-
Any resulting exchange rate gains or losses are recognized
sitive difference between the price paid, measured at fair
as a separate component of equity in a special reserve.
value as at the acquisition date, plus the value of any non-
The gains and losses are recognized proportionately in the
controlling interests, and the net value of the identifiable
income statement on the disposal (partial or total) of the
assets and liabilities of the acquiree measured at fair value
subsidiary.
is recognized as goodwill. Any negative difference is reco-
Business combinations
gnized in profit or loss.
The value of non-controlling interests is determined either
in proportion to the interest held by minority shareholders
Business combinations initiated before January 1, 2010 and
in the net identifiable assets of the acquiree or at their fair
completed within that financial year are recognized on the
value as at the acquisition date.
basis of IFRS 3 (2004).
In the case of business combinations achieved in stages, at
Such business combinations were recognized using the
the date of acquisition of control the previously held equity
purchase method, where the purchase cost is equal to the
interest in the acquiree is remeasured to fair value and any
fair value at the date of the exchange of the assets acquired
positive or negative difference is recognized in profit or loss.
and the liabilities incurred or assumed, plus costs directly
Any contingent consideration is recognized at fair value at
attributable to the acquisition. This cost was allocated by
the acquisition date. Subsequent changes to the fair va-
recognizing the assets, liabilities and identifiable contingent
lue of the contingent consideration classified as an asset
liabilities of the acquired company at their fair values. Any
or a liability that is a financial instrument within the scope
positive difference between the cost of the acquisition and
of IAS 39 is recognized either in profit or loss or in other
the fair value of the net assets acquired pertaining to the
comprehensive income. If the contingent consideration is
shareholders of the Parent Company was recognized as go-
not within the scope of IAS 39, it is measured in accor-
odwill. Any negative difference was recognized in profit or
dance with the appropriate IFRS-EU. Contingent considera-
loss. The value of non-controlling interests was determined
tion that is classified as equity is not re-measured, and its
in proportion to the interest held by minority shareholders in
subsequent settlement is accounted for within equity.
the net assets. In the case of business combinations achie-
If the fair values of the assets, liabilities and contingent
ved in stages, at the date of acquisition any adjustment to
liabilities can only be calculated on a provisional basis, the
172
Annual Report 2015 business combination is recognized using such provisional
maximizing the use of relevant observable inputs and mini-
values. Any adjustments resulting from the completion of
mizing the use of unobservable inputs.
the measurement process are recognized within 12 months
of the date of acquisition, restating comparative figures.
Fair value measurement
Property, plant and equipment
Property, plant and equipment is stated at cost, net of accu-
mulated depreciation and accumulated impairment losses,
For all fair value measurements and disclosures of fair va-
if any. Such cost includes expenses directly attributable to
lue, that are either required or permitted by international
bringing the asset to the location and condition necessary
accounting standards, the Group applies IFRS 13.
for its intended use.
Fair value is defined as the price that would be received to
The cost is also increased by the present value of the esti-
sell an asset or paid to transfer a liability, in an orderly tran-
mate of the costs of decommissioning and restoring the
saction, between market participants, at the measurement
site on which the asset is located where there is a legal or
date (i.e. an exit price).
constructive obligation to do so. The corresponding liability
The fair value measurement assumes that the transaction
is recognized under provisions for risks and charges. The
to sell an asset or transfer a liability takes place in the prin-
accounting treatment of changes in the estimate of these
cipal market, i.e. the market with the greatest volume and
costs, the passage of time and the discount rate is discus-
level of activity for the asset or liability. In the absence of
sed under “Provisions for risks and charges”.
a principal market, it is assumed that the transaction takes
Property, plant and equipment transferred from customers
place in the most advantageous market to which the Group
to connect them to the electricity distribution network and/
has access, i.e. the market that maximizes the amount
or to provide them with ongoing access to a supply of elec-
that would be received to sell the asset or minimizes the
tricity is initially recognized at its fair value at the time of
amount that would be paid to transfer the liability.
the transfer.
The fair value of an asset or a liability is measured using the
Borrowing costs that are directly attributable to the acquisi-
assumptions that market participants would use when pri-
tion, construction or production of a qualifying asset, i.e. an
cing the asset or liability, assuming that market participants
asset that takes a substantial period of time to get ready for
act in their economic best interest. Market participants are
its intended use or sale, are capitalized as part of the cost
independent, knowledgeable sellers and buyers who are
of the assets themselves. Borrowing costs associated with
able to enter into a transaction for the asset or the liability
the purchase/construction of assets that do not meet such
and who are motivated but not forced or otherwise compel-
requirement are expensed in the period in which they are
led to do so.
incurred.
When measuring fair value, the Group takes into account
Certain assets that were revalued at the IFRS-EU transition
the characteristics of the asset or liability, in particular:
date or in previous periods are recognized at their fair value,
> for a non-financial asset, a fair value measurement takes
which is considered to be their deemed cost at the revalua-
into account a market participant’s ability to generate
tion date.
economic benefits by using the asset in its highest and
Where individual items of major components of property,
best use or by selling it to another market participant that
plant and equipment have different useful lives, the compo-
would use the asset in its highest and best use;
nents are recognized and depreciated separately.
> for liabilities and own equity instruments, the fair value
Subsequent costs are recognized as an increase in the
reflects the effect of non-performance risk, i.e. the risk
carrying amount of the asset when it is probable that future
that an entity will not fulfill an obligation;
economic benefits associated with the cost incurred to re-
> in the case of groups of financial assets and financial liabi-
place a part of the asset will flow to the Group and the cost
lities with offsetting positions in market risk or credit risk,
of the item can be measured reliably. All other costs are
managed on the basis of an entity’s net exposure to such
recognized in profit or loss as incurred.
risks, it is permitted to measure fair value on a net basis.
The cost of replacing part or all of an asset is recognized as
In measuring the fair value of assets and liabilities, the
an increase in the carrying amount of the asset and is de-
Group uses valuation techniques that are appropriate in the
preciated over its useful life; the net carrying amount of the
circumstances and for which sufficient data are available,
replaced unit is derecognized through profit or loss.
173
Consolidated financial statementsAnnual Report 2015 Property, plant and equipment, net of its residual value, is
Assets recognized under property, plant and equipment are
depreciated on a straight-line basis over its estimated use-
derecognized either at the time of their disposal or when
ful life, which is reviewed annually and, if appropriate, adju-
no future economic benefit is expected from their use or di-
sted prospectively. Depreciation begins when the asset is
sposal. Any gain or loss, recognized through profit or loss, is
available for use.
calculated as the difference between the net consideration
received in the disposal, where present, and the net carrying
The estimated useful life of the main items of property, plant
amount of the derecognized assets.
and equipment is as follows:
Civil buildings
20-70 years
Assets to be relinquished free of charge
The Group’s plants include assets to be relinquished free of
Buildings and civil works incorporated in plants
20-85 years
charge at the end of the concessions. These mainly regard
Hydroelectric power plants:
- penstock
- mechanical and electrical machinery
- other fixed hydraulic works
Thermal power plants:
- boilers and auxiliary components
- gas turbine components
- mechanical and electrical machinery
- other fixed hydraulic works
Nuclear power plants
Geothermal power plants:
- cooling towers
- turbines and generators
- turbine parts in contact with fluid
- mechanical and electrical machinery
Wind power plants:
- towers
- turbines and generators
20-75 years
24-40 years
25-100 years
19-46 years
10-40 years
10-45 years
10-66 years
60 years
10-20 years
20-30 years
10-25 years
20-22 years
major water diversion works and the public lands used for
the operation of the thermal power plants. For Italy, the con-
cessions terminate between 2020 and 2040.
Within the Italian regulatory framework in force until 2011,
if the concessions are not renewed, at those dates all inta-
ke and governing works, penstocks, outflow channels and
other assets on public lands were to be relinquished free
of charge to the government in good operating condition.
Accordingly, depreciation on assets to be relinquished was
calculated over the shorter of the term of the concession
and the remaining useful life of the assets.
In the wake of the legislative changes introduced with Law
134 of August 7, 2012, the assets previously classified as
assets “to be relinquished free of charge” connected with
the hydroelectric water diversion concessions are now con-
20-25 years
sidered in the same manner as other categories of “pro-
20-25 years
perty, plant and equipment” and are therefore depreciated
- mechanical and electrical machinery
15-25 years
over the economic and technical life of the asset (where this
Solar power plants:
- mechanical and electrical machinery
15-40 years
Public and artistic lighting:
- public lighting installations
- artistic lighting installations
Transmission lines
Transformer stations
Distribution plants:
- high-voltage lines
- primary transformer stations
- low- and medium-voltage lines
Meters:
- electromechanical meters
- electricity balance measurement equipment
- electronic meters
18-25 years
20-25 years
20-50 years
10-60 years
30-50 years
10-60 years
23-50 years
2-27 years
2-35 years
10-20 years
The useful life of leasehold improvements is determined on
the basis of the term of the lease or, if shorter, on the duration
of the benefits produced by the improvements themselves.
Land is not depreciated as it has an undetermined useful
life.
174
exceeds the term of the concession), as discussed in the
section above on the “Depreciable value of certain elements
of Italian hydroelectric plants subsequent to enactment of
Law 134/2012”, which you are invited to consult for more
details.
In accordance with Spanish laws 29/1985 and 46/1999,
hydroelectric power stations in Spanish territory operate
under administrative concessions at the end of which the
plants will be returned to the government in good operating
condition. The terms of the concessions extend up to 2067.
A number of generation companies that operate in Argenti-
na, Brazil and Mexico hold administrative concessions with
similar conditions to those applied under the Spanish con-
cession system. These concessions will expire in the period
between 2013 and 2088.
As regards the distribution of electricity, the Group is a con-
cession holder in Italy for this service. The concession, gran-
Annual Report 2015 ted by the Ministry for Economic Development, was issued
> an intangible asset, if the operator receives the right (a
free of charge and terminates on December 31, 2030. If the
license) to charge users of the public service provided. In
concession is not renewed upon expiry, the grantor is requi-
such a case, the operator does not have an unconditional
red to pay an indemnity. The amount of the indemnity will be
right to receive cash because the amounts are contingent
determined by agreement of the parties using appropriate
on the extent that the public uses the service.
valuation methods, based on both the balance-sheet value
If the Group (as operator) has a contractual right to receive
of the assets themselves and their profitability.
an intangible asset (the right to charge users of the public
In determining the indemnity, such profitability will be re-
service), borrowing costs are capitalized using the criteria
presented by the present value of future cash flows. The in-
specified in the section “Property, plant and equipment”.
frastructure serving the concessions is owned and available
During the operating phase of concession arrangements,
to the concession holder. It is recognized under “Property,
the Group accounts for operating service payments in accor-
plant and equipment” and is depreciated over the useful li-
dance with criteria specified in the section “Revenue”.
ves of the assets.
Enel also operates under administrative concessions for the
distribution of electricity in other countries (including Spain
Leases
and Romania). These concessions give the right to build and
The Group holds property, plant and equipment and intangible
operate distribution networks for an indefinite period of time.
assets for its various activities under lease contracts.
Infrastructure within the scope
of “IFRIC 12 - Service concession
arrangements”
These contracts are analyzed on the basis of the circumstan-
ces and indicators set out in IAS 17 in order to determine
whether they constitute operating leases or finance leases.
A finance lease is defined as a lease that transfers substan-
tially all the risks and rewards incidental to ownership of the
Under a “public-to-private” service concession arrangement
related asset to the lessee. All leases that do not meet the
within the scope of “IFRIC 12 - Service concession arrange-
definition of a finance lease are classified as operating leases.
ments” the operator acts as a service provider and, in accor-
On initial recognition assets held under finance leases are re-
dance with the terms specified in the contract, it constructs/
cognized as property, plant and equipment and the related
upgrades infrastructure used to provide a public service and
liability is recognized under long-term borrowings. At incep-
operates and maintains that infrastructure for the period of
tion date finance leases are recognized at the lower of the fair
the concession.
value of the leased asset and the present value of the mini-
The Group, as operator, does not recognize the infrastructure
mum lease payments due, including the payment required to
within the scope of IFRIC 12 as property, plant and equipment
exercise any purchase option.
and it accounts for revenue and costs relating to construction/
The assets are depreciated on the basis of their useful lives.
upgrade services as discussed in the section “Construction
If it is not reasonably certain that the Group will acquire the
contracts”. In particular, the Group measures the considera-
assets at the end of the lease, they are depreciated over the
tion received or receivable for the construction/upgrading of
shorter of the lease term and the useful life of the assets.
infrastructure at its fair value and, depending on the characte-
Payment made under operating lease are recognized as a
ristics of the service concession arrangement, it recognizes:
cost on a straight-line basis over the lease term.
> a financial asset, if the operator has an unconditional con-
Although not formally designated as lease agreements, cer-
tractual right to receive cash or another financial asset
tain types of contract can be considered as such if the fulfil-
from the grantor (or from a third party at the direction of
ment of the arrangement is dependent on the use of a speci-
the grantor) and the grantor has little discretion to avoid
fic asset (or assets) and if the arrangement conveys a right to
payment. In this case, the grantor contractually guaran-
use such assets.
tees to pay to the operator specified or determinable
amounts or the shortfall between the amounts received
from the users of the public service and specified or de-
Investment property
terminable amounts (defined by the contract), and such
Investment property consists of the Group’s real estate held
payments are not dependent on the usage of the infra-
to earn rentals and/or for capital appreciation rather than for
structure; and/or
use in the production or supply of goods and services.
175
Consolidated financial statementsAnnual Report 2015 Investment property is measured at acquisition cost less
ble. If not, the change in useful life from indefinite to finite is
any accumulated depreciation and any accumulated impai-
accounted for as a change in accounting estimate.
rment losses.
Intangible assets are derecognized either at the time of their
Investment property, excluding land, is depreciated on a
disposal or when no future economic benefit is expected
straight-line basis over the useful lives of the assets.
from their use or disposal. Any gain or loss, recognized
Impairment losses are determined on the basis of criteria
through profit or loss, is calculated as the difference betwe-
discussed below.
en the net consideration received in the disposal, where
The breakdown of the fair value of investment property is de-
present, and the net book value of the derecognized assets.
tailed in note 45 “Assets measured at fair value”. Investment
The estimated useful life of the main intangible assets, di-
property is derecognized either at the time of its disposal or
stinguishing between internally generated and acquired as-
when no future economic benefit is expected from its use or
sets, is as follows:
disposal. Any gain or loss, recognized through profit or loss,
is calculated as the difference between the net considera-
tion received in the disposal, where present, and the net
book value of the derecognized assets.
Intangible assets
Intangible assets are identifiable assets without physical
Development costs:
- internally generated
- acquired
Industrial patents and intellectual property
rights:
- internally generated
- acquired
Concessions, licenses, trademarks and similar
rights:
substance controlled by the entity and capable of generating
- internally generated
future economic benefits. They are measured at purchase or
internal development cost when it is probable that the use
of such assets will generate future economic benefits and
- acquired
Other:
- internally generated
- acquired
the related cost can be reliably determined.
The cost includes any directly attributable expenses neces-
sary to make the assets ready for their intended use.
Goodwill
3-5 years
3-5 years
5 years
3-25 years
-
2-60 years
2-5 years
-
Internal development costs are recognized as an intangible
Goodwill arises on the acquisition of subsidiaries and repre-
asset when both the Group is reasonably assured of the
sents the excess of the consideration transferred, as mea-
technical feasibility of completing the intangible asset and
sured at fair value at the acquisition date, and the value of
that the asset will generate future economic benefits and
any non-controlling interests over the net fair value of the
it has intention and ability to complete the asset and use or
acquiree’s identifiable assets and liabilities. After initial reco-
sell it.
gnition, goodwill is not amortized, but is tested for recovera-
Research costs are recognized as expenses.
bility at least annually using the criteria discussed in the sec-
Intangible assets with a finite useful life are reported net of
tion “Impairment of non-financial assets”. For the purpose
accumulated amortization and any impairment losses.
of impairment testing, goodwill is allocated, from the acqui-
Amortization is calculated on a straight-line basis over the
sition date, to each of the identified cash generating units.
item’s estimated useful life, which is reassessed at least
Goodwill relating to equity investments in associates and
annually; any changes in amortization policies are reflected
joint ventures is included in their carrying amount.
on a prospective basis. Amortization commences when the
asset is ready for use. Consequently, intangible assets not
yet available for use are not amortized, but are tested for
Impairment of non-financial assets
impairment at least annually.
At each reporting date, non-financial assets are reviewed to
The Group’s intangible assets have a definite useful life, with
determine whether there is evidence of impairment. If such
the exception of a number of concessions and goodwill.
evidence exists, the recoverable amount of any involved as-
Intangible assets with indefinite useful lives are not amorti-
set is estimated. The recoverable amount is the higher of an
zed, but are tested for impairment annually.
asset’s fair value less costs of disposal and its value in use.
The assessment of indefinite life is reviewed annually to de-
In order to determine the recoverable amount of property,
termine whether the indefinite life continues to be supporta-
plant and equipment, intangible assets and goodwill, the
176
Annual Report 2015 Group generally adopts the value-in-use criterion.
Inventories
The value in use is represented by the present value of the
estimated future cash flows generated by the asset in que-
stion. Value in use is determined by discounting estimated
future cash flows using a pre-tax discount rate that reflects
the current market assessment of the time value of money
and the specific risks of the asset.
The future cash flows used to determine value in use are ba-
sed on the most recent business plan, approved by the mana-
gement, containing forecasts for volumes, revenue, operating
costs and investments.
These projections cover the next five years. Consequently,
cash flows related to subsequent periods are determined on
the basis of a long-term growth rate that does not exceed the
average long-term growth rate for the particular sector and
country.
The recoverable amount of assets that do not generate inde-
pendent cash flows is determined based on the cash genera-
ting unit to which the asset belongs.
If the carrying amount of an asset or of a cash generating unit
to which it is allocated is higher than its recoverable amount,
an impairment loss is recognized in profit or loss under “De-
preciation, amortization and impairment losses”.
Impairment losses of cash generating units are firstly char-
ged against the carrying amount of any goodwill attributed
to it and then against the other assets, in proportion to their
carrying amount.
If the reasons for a previously recognized impairment loss
no longer obtain, the carrying amount of the asset is resto-
red through profit or loss, under “Depreciation, amortization
and impairment losses”, in an amount that shall not exceed
the net carrying amount that the asset would have had if the
Inventories are measured at the lower of cost and net reali-
zable value except for inventories involved in trading activi-
ties, which are measured at fair value with recognition throu-
gh profit or loss. Cost is determined on the basis of average
weighted cost, which includes related ancillary charges. Net
estimated realizable value is the estimated normal selling
price net of estimated costs to sell or, where applicable, re-
placement cost.
For the portion of inventories held to discharge sales that
have already been made, the net realizable value is determi-
ned on the basis of the amount established in the contract
of sale.
Inventories include environmental certificates (green cer-
tificates, energy efficiency certificates and CO2 emissions
allowances) that were not utilized for compliance in the re-
porting period. As regards CO2 emissions allowances, inven-
tories are allocated between the trading portfolio and the
compliance portfolio, i.e. those used for compliance with
greenhouse gas emissions requirements. Within the latter,
CO2 emissions allowances are allocated to sub-portfolios on
the basis of the compliance year to which they have been
assigned.
Inventories also include nuclear fuel stocks, use of which is
determined on the basis of the electricity generated.
Materials and other consumables (including energy commo-
dities) held for use in production are not written down if it is
expected that the final product in which they will be incorpo-
rated will be sold at a price sufficient to enable recovery of
the cost incurred.
impairment loss had not been recognized and depreciation
Construction contracts
or amortization had been performed. The original value of go-
odwill is not restored even if in subsequent years the reasons
for the impairment no longer obtain.
The recoverable amount of goodwill and intangible assets
with an indefinite useful life and intangible assets not yet
available for use is tested for recoverability annually or more
frequently if there is evidence suggesting that the assets may
be impaired.
If certain specific identified assets owned by the Group are
impacted by adverse economic or operating conditions that
undermine their capacity to contribute to the generation of
cash flows, they can be isolated from the rest of the assets
of the cash generating unit, undergo separate analysis of their
recoverability and are impaired where necessary.
When the outcome of a construction contract can be estima-
ted reliably and it is probable that the contract will be profi-
table, contract revenue and contract costs are recognized by
reference to the stage of completion of the contract activity at
the end of the reporting period. Under this criteria, revenue,
expenses and profit are attributed in proportion to the work
completed.
When it is probable that total contract costs will exceed total
contract revenue, the expected loss on the construction con-
tract is recognized as an expense immediately, regardless of
the stage of completion of the contract.
When the outcome of a construction contract cannot be esti-
mated reliably, contract revenue is recognized only to the
extent of contract costs incurred that are likely to be recove-
rable.
177
Consolidated financial statementsAnnual Report 2015 The stage of completion of the contract in progress is deter-
on an active market and not representing equity investments,
mined, using the cost-to-cost method, as a ratio between
for which the Group has the positive intention and ability to
costs incurred for work performed to the reporting date and
hold until maturity. They are initially recognized at fair value,
the estimated total contract costs. In addition to initial amount
including any transaction costs, and subsequently measured
of revenue agreed in the contract, contract revenue includes
at amortized cost using the effective interest method.
any payments in respect of variations, claims and incentives,
to the extent that it is probable that they will result in revenue
and can be reliably measured.
Loans and receivables
This category mainly includes trade receivables and other fi-
The amount due from customers for construction contract is
nancial receivables. Loans and receivables are non-derivative
presented as an asset; the amount due to customers for con-
financial assets with fixed or determinable payments, that
struction contract is presented as a liability.
are not quoted on an active market, other than those the
Financial instruments
Group intends to sell immediately or in the short term (which
are classified as held for trading) and those that the Group,
on initial recognition, designates as either at fair value throu-
Financial instruments are recognized and measured in accor-
gh profit or loss or available for sale. Such assets are initially
dance with IAS 32 and IAS 39.
recognized at fair value, adjusted for any transaction costs,
A financial asset or liability is recognized in the consolidated
and are subsequently measured at amortized cost using the
financial statements when, and only when, the Group be-
effective interest method, without discounting unless ma-
comes party to the contractual provisions of the instrument
terial.
(the trade date).
Financial instruments are classified as follows under IAS 39:
> financial assets and liabilities at fair value through profit
Available-for-sale financial assets
This category mainly includes listed debt securities not clas-
or loss;
sified as held to maturity and equity investments in other
> held-to-maturity financial assets;
entities (unless classified as “designated as at fair value
> loans and receivables;
through profit or loss”). Available-for-sale financial assets are
> available-for-sale financial assets;
non-derivative financial assets that are designated as avai-
> financial liabilities at amortized cost.
lable for sale or are not classified as loans and receivables,
Financial assets and liabilities at fair value
through profit or loss
This category includes: securities, equity investments in en-
held-to-maturity financial assets or financial assets at fair va-
lue through profit or loss.
These financial instruments are measured at fair value with
changes in fair value recognized in other comprehensive in-
tities other than subsidiaries, associates and joint ventures
come.
and investment funds held for trading or designated as at fair
At the time of sale, or when a financial asset available for
value through profit or loss at the time of initial recognition.
sale becomes an investment in a subsidiary as a result of
Financial instruments at fair value through profit or loss are
successive purchases, the cumulative gains and losses pre-
financial assets and liabilities:
viously recognized in equity are reversed to the income sta-
> classified as held for trading because acquired or incurred
tement.
principally for the purpose of selling or repurchasing at
When the fair value cannot be determined reliably, these
short term;
assets are recognized at cost adjusted for any impairment
> designated as such upon initial recognition, under the op-
losses.
tion allowed by IAS 39 (the fair value option).
Such financial assets and liabilities are initially recognized at
fair value with subsequent gains and losses from changes in
Impairment of financial assets
At each reporting date, all financial assets classified as loans
their fair value recognized through profit or loss.
and receivables (including trade receivables), held to matu-
Held-to-maturity financial assets
This category comprises non-derivative financial assets with
rity or available for sale, are assessed in order to determine
if there is objective evidence that an asset or a group of
financial assets is impaired.
fixed or determinable payments and fixed maturity, quoted
An impairment loss is recognized if and only if such evidence
178
Annual Report 2015 exists as a result of one or more events that occurred after
is the cumulative fair value loss recognized in other com-
initial recognition and that have an impact on the future cash
prehensive income. Such impairment loss is reversed throu-
flows of the asset and which can be estimated reliably.
gh profit or loss if the fair value of the debt instrument objec-
Objective evidence of an impairment loss includes observa-
tively increases as a result of an event that occurred after the
ble data about, for example:
impairment loss was recognized.
> significant financial difficulty of the issuer or obligor;
> a breach of contract, such as a default or delinquency in
interest or principal payments;
Cash and cash equivalents
This category includes deposits that are available on de-
> evidence that the borrower will enter bankruptcy or other
mand or at very short term, as well as highly liquid short-
form of financial reorganization;
term financial investments that are readily convertible into a
> a measurable decrease in estimated future cash flows.
known amount of cash and which are subject to insignificant
Losses that are expected to arise as a result of future events
risk of changes in value.
are not recognized.
In addition, for the purpose of the consolidated statement of
For financial assets classified as loans and receivables or
cash flows, cash and cash equivalents do not include bank
held to maturity, once an impairment loss has been iden-
overdrafts at period-end.
tified, its amount is measured as the difference between
the carrying amount of the asset and the present value of
expected future cash flows, discounted at the original effec-
Financial liabilities at amortized cost
This category mainly includes borrowings, trade payables,
tive interest rate. This amount is recognized in profit or loss.
finance lease obligations and debt instruments.
The carrying amount of trade receivable is reduced through
Financial liabilities other than derivatives are recognized
use of an allowance account.
when the Group becomes a party to the contractual clauses
If the amount of a past impairment loss decreases and the
of the instrument and are initially measured at fair value adju-
decrease can be related objectively to an event occurring
sted for directly attributable transaction costs. Financial lia-
after the impairment was recognized, the impairment is re-
bilities are subsequently measured at amortized cost using
versed through profit or loss.
the effective interest rate method.
Further factors are considered in case of impairment of avai-
lable-for-sale equity investments, such as significant adverse
changes in the technological, market, economic or legal en-
Derivative financial instruments
A derivative is a financial instrument or another contract:
vironment.
> whose value changes in response to the changes in an
A significant or prolonged decline in fair value constitutes
underlying variable such as an interest rate, commodity or
objective evidence of impairment and, therefore, the fair va-
security price, foreign exchange rate, a price or rate index,
lue loss previously recognized in other comprehensive inco-
a credit rating or other variable;
me is reclassified from equity to income.
> that requires no initial net investment, or an initial net in-
The amount of the cumulative loss is the difference betwe-
vestment that is smaller than would be required for a con-
en the acquisition cost and the current fair value, less any
tract with a similar response to changes in market factors;
impairment loss previously recognized in profit or loss. An
> that is settled at a future date.
impairment loss on an available-for-sale equity investment
Derivative instruments are classified as financial assets or
cannot be reversed.
liabilities depending on whether their fair value is positive or
If there is objective evidence of impairment for unquoted
negative and they are classified as “held for trading” and me-
equity instruments measured at cost because fair value can-
asured at fair value through profit or loss, except for those
not be reliably measured, the amount of the impairment loss
designated as effective hedging instruments.
is measured as the difference between the carrying amount
For more details about hedge accounting, please see note 44
and the present value of estimated future cash flows, di-
“Derivatives and hedge accounting”.
scounted at the current rate of interest for a similar financial
All derivatives held for trading are classified as current assets
asset. Reversal of impairment are not permitted in these ca-
or liabilities.
ses either.
Derivatives not held for trading purposes but measured at fair
The amount of the impairment loss on a debt instrument
value through profit or loss since they do not qualify for hedge
classified as available for sale, to be reclassified from equity,
accounting and derivatives designated as effective hedging
179
Consolidated financial statementsAnnual Report 2015 instruments are classified as current or non-current on the ba-
A contract to buy or sell non-financial items is classified as
sis of their maturity date and the Group’s intention to hold the
a “normal purchase or sale” if it is entered into:
financial instrument until maturity or not.
> for the purpose of physical delivery;
> in accordance with the Group’s expected purchase, sale
Embedded derivatives
An embedded derivative is a derivative included in a “com-
or usage requirements.
The Group analyses all contracts to buy or sell non-finan-
bined” contract (the so-called “hybrid instrument”) that con-
cial assets, with a specific focus on forward purchases and
tains another non-derivative contract (the so-called “host
sales of electricity and energy commodities, in order to
contract“) and gives rise to some or all of the combined con-
determine if they should be classified and treated in ac-
tract’s cash flows.
cordance with IAS 39 or if they have been entered into for
The main Group contracts that may contain embedded derivati-
“own use”.
ves are contracts to buy or sell non-financial items with clauses
or options that affect the contract price, volume or maturity.
Such contracts, which do not represent financial instruments
to be measured at fair value, are analyzed in order to identify
Derecognition of financial assets and lia-
bilities
Financial assets are derecognized whenever one of the fol-
any embedded derivatives, which are to be separated and
lowing conditions is met:
measured at fair value. This analysis is performed when the
> the contractual right to receive the cash flows associated
Group becomes party to the contract or when the contract
with the asset expires;
is renegotiated in a manner that significantly changes the
> the Group has transferred substantially all the risks and
original associated cash flows. Embedded derivatives are
rewards associated with the asset, transferring its rights
separated from the host contract and accounted for as de-
to receive the cash flows of the asset or assuming a con-
rivatives when:
tractual obligation to pay such cash flows to one or more
> host contract is not a financial instrument measured at fair
beneficiaries under a contract that meets the require-
value through profit or loss;
ments established by IAS 39 (the “pass through test”);
> the economic risks and characteristics of the embedded
> the Group has not transferred or retained substantially all
derivative are not closely related to those of the host con-
the risks and rewards associated with the asset but has
tract;
transferred control over the asset.
> a separate contract with the same terms as the embed-
Financial liabilities are derecognized when they are extingui-
ded derivative would meet the definition of a derivative.
shed, i.e. when the contractual obligation has been dischar-
Embedded derivatives that are separated from the host con-
ged, cancelled or expired.
tract are recognized in the consolidated financial statements
at fair value with changes recognized through profit or loss
(except when the embedded derivative is part of a designa-
Offsetting financial assets and liabilities
The Group offsets financial assets and liabilities when:
ted hedging relationship).
> there is a legally enforceable right to set off the recogni-
Contracts to buy or sell non-financial items
In general, contracts to buy or sell non-financial items that
are entered into and continue to be held for receipt or de-
livery, in accordance with the Group’s normal expected
purchase, sale or usage requirements, do not fall within
zed amounts; and
> it has the intention of either settling on a net basis, or
realizing the asset and settling the liability simultaneously.
Employee benefits
the scope of IAS 39 and are then recognized in accordan-
Liabilities related to employee benefits paid upon or after ce-
ce with the accounting treatment of such transactions (the
asing employment in connection with defined benefit plans
“own use exemption”).
or other long-term benefits accrued during the employment
Such contracts are recognized as derivatives and, as a con-
period are determined separately for each plan, using actua-
sequence, at fair value through profit or loss only if:
rial assumptions to estimate the amount of the future bene-
> they can be settled net in cash; and
fits that employees have accrued at the balance sheet date
> they are not entered into in accordance with the Group’s
(the projected unit credit method). More specifically, the
expected purchase, sale or usage requirements.
present value of the defined benefit obligation is calculated
180
Annual Report 2015 by using a discount rate determined on the basis of market
the termination benefits due to employees are expected
yields at the end of the reporting period on high-quality cor-
to be settled wholly before 12 months after the end of the
porate bonds.
annual reporting period, the entity measures the liability in
The liability is recognized on an accruals basis over the ve-
accordance with the requirements for short-term employee
sting period of the related rights. These appraisals are perfor-
benefits; if they are not expected to be settled wholly before
med by independent actuaries.
12 months after the end of the annual reporting period, the
If the value of plan assets exceeds the present value of the
entity measures the liability in accordance with the require-
related defined benefit obligation, the surplus (up to the limit
ments for other long-term employee benefits.
of any cap) is recognized as an asset.
As regards the liabilities/(assets) of defined benefit plans,
the cumulative actuarial gains and losses from the actuarial
Provisions for risks and charges
measurement of the liabilities, the return on the plan assets
Provisions are recognized where there is a legal or construc-
(net of the associated interest income) and the effect of the
tive obligation as a result of a past event at the end of the
asset ceiling (net of the associated interest income) are re-
reporting period, the settlement of which is expected to re-
cognized in other comprehensive income when they occur.
sult in an outflow of resources whose amount can be relia-
For other long-term benefits, the related actuarial gains and
bly estimated. Where the impact is not immaterial, the ac-
losses are recognized through profit or loss.
cruals are determined by discounting expected future cash
In the event of a change being made to an existing defined
flows using a pre-tax discount rate that reflects the current
benefit plan or the introduction of a new plan, any past servi-
market assessment of the time value of money and, if ap-
ce cost is recognized immediately in profit or loss.
plicable, the risks specific to the liability. If the provision is
Employees are also enrolled in defined contribution plans
discounted, the periodic adjustment of the present value for
under which the Group pays fixed contributions to a separa-
the time factor is recognized as a financial expense.
te entity (a fund) and has no legal or constructive obligation
When the Group expects some or all of the expenditure re-
to pay further contributions if the fund does not hold suffi-
quired to extinguish a liability will be reimbursed by a third
cient assets to pay all employee benefits relating to emplo-
party, the reimbursement is recognized as a separate asset
yee service in the current and prior periods. Such plans are
if such reimbursement is virtually certain.
usually aimed to supplement pension benefits due to em-
Where the liability relates to plant decommissioning and/
ployees post-employment. The related costs are recognized
or site restoration, the initial recognition of the provision
in income statement on the basis of the amount of contribu-
is made against the related asset and the expense is then
tions paid in the period.
recognized in profit or loss through the depreciation of the
Termination benefits
asset involved.
Where the liability regards the treatment and storage of nu-
clear waste and other radioactive materials, the provision is
Liabilities for benefits due to employees for the early termi-
recognized against the related operating costs.
nation of the employment relationship, both as a result of a
In the case of contracts in which the unavoidable costs of
decision by the Group or an employee’s decision to accept
meeting the obligations under the contract exceed the eco-
voluntary redundancy in exchange for these benefits, are re-
nomic benefits expected to be received under it (onerous
cognized at the earlier of the following dates:
contracts), the Group recognizes a provision as the lower of
> when the Group can no longer withdraw its offer of be-
the costs of fulfilling the obligation that exceed the econo-
nefits; and
mic benefits expected to be received under the contract and
> when the Group recognizes a cost for a restructuring that
any compensation or penalty arising from failure to fulfil it.
is within the scope of IAS 37 and involves the payment of
Changes in estimates of accruals to the provision are reco-
termination benefits.
gnized in the income statement in the period in which the
The liabilities are measured on the basis of the nature of
changes occur, with the exception of those in respect of the
the employee benefits. More specifically, when the bene-
costs of decommissioning, dismantling and/or restoration re-
fits represent an enhancement of other post-employment
sulting from changes in the timetable and costs necessary to
benefits, the associated liability is measured in accordance
extinguish the obligation or from a change in the discount rate.
with the rules governing that type of benefit. Otherwise, if
These changes increase or decrease the value of the related
181
Consolidated financial statementsAnnual Report 2015 assets and are taken to the income statement through depre-
tes (so-called white certificates), as well as the European
ciation. Where they increase the value of the assets, it is also
“Emissions Trading System”.
determined whether the new carrying amount of the assets
Green certificates accrued in proportion to electricity ge-
is fully recoverable. If this is not the case, a loss equal to the
nerated by renewable energy plants and energy efficiency
unrecoverable amount is recognized in the income statement.
certificates accrued in proportion to energy savings achie-
Decreases in estimates are recognized up to the carrying
ved that have been certified by the competent authority are
amount of the assets. Any excess is recognized immediately
treated as non-monetary government operating grants and
in the income statement.
are recognized at fair value, under other revenue and inco-
For more information on the estimation criteria adopted in
me, with recognition of an asset under other non-financial
determining liabilities for plant dismantling and site restora-
assets, if the certificates are not yet credited to the owner-
tion, especially those associated with nuclear power plants
ship account, or under inventories, if the certificates have
or the storage of waste fuel and other radioactive materials,
already been credited to that account. At the time the cer-
please see the section on the use of estimates.
tificates are credited to the ownership account, they are re-
Government grants
classified from other assets to inventories.
Revenue from the sale of such certificates are recognized
under revenue from sales and services, with a correspon-
Government grants, including non-monetary grants at fair
ding decrease in inventories.
value, are recognized where there is reasonable assuran-
For the purposes of accounting for charges arising from re-
ce that they will be received and that the Group will com-
gulatory requirements concerning green certificates, energy
ply with all conditions attaching to them as set by the go-
vernment, government agencies and similar bodies whether
efficiency certificates and CO2 emissions allowances, the
Group uses the “net liability approach”.
local, national or international.
Under this accounting policy, environmental certificates re-
When loans are provided by governments at a below-market
ceived free of charge and those self-produced as a result of
rate of interest, the benefit is regarded as a government
Group’s operations that will be used for compliance purpo-
grant. The loan is initially recognized and measured at fair
ses are recognized at nominal value (nil). In addition, char-
value and the government grant is measured as the diffe-
ges incurred for obtaining (in the market or in some other
rence between the initial carrying amount of the loan and
transaction for consideration) any missing certificates to
the funds received. The loan is subsequently measured in
fulfil compliance requirements for the reporting period are
accordance with the requirements for financial liabilities.
recognized through profit or loss on an accruals basis un-
Government grants are recognized in profit or loss on a syste-
der other operating expenses, as they represent “system
matic basis over the periods in which the Group recognizes as
charges” consequent upon compliance with a regulatory
expenses the costs that the grants are intended to compensate.
requirement.
Where the Group receives government grants in the form of
a transfer of a non-monetary asset for the use of the Group,
it accounts for both the grant and the asset at the fair value of
the non-monetary asset received at the date of the transfer.
Grants related to long-lived assets, including non-monetary
Non-current assets (or disposal
groups) classified as held for sale
and discontinued operations
grants at fair value, i.e. those received to purchase, build or
Non-current assets (or disposal groups) are classified as
otherwise acquire non-current assets (for example, an item
held for sale if their carrying amount will be recovered prin-
of property, plant and equipment or an intangible asset), are
cipally through a sale transaction, rather than through con-
recognized on a deferred basis under other liabilities and are
tinuing use.
credited to profit or loss on a straight-line basis over the use-
This classification criteria is applicable only when non-cur-
ful life of the asset.
Environmental certificates
rent assets (or disposal groups) are available in their present
condition for immediate sale and the sale is highly probable.
If the Group is committed to a sale plan involving loss of con-
trol of a subsidiary and the requirements provided for under
Some Group companies are affected by national regulations
IFRS 5 are met, all the assets and liabilities of that subsidiary
governing green certificates and energy efficiency certifica-
are classified as held for sale when the classification criteria
182
Annual Report 2015 are met, regardless of whether the Group will retain a non-
> represents a separate major line of business or geographi-
controlling interest in its former subsidiary after the sale.
cal area of operations;
The Group applies these classification criteria as envisaged
> is part of a single coordinated plan to dispose of a sepa-
in IFRS 5 to an investment, or a portion of an investment, in
rate major line of business or geographical area of ope-
an associate or a joint venture. Any retained portion of an in-
rations; or
vestment in an associate or a joint venture that has not been
> is a subsidiary acquired exclusively with a view to resale.
classified as held for sale is accounted for using the equity
The Group presents, in a separate line item of the income
method until disposal of the portion that is classified as held
statement, a single amount comprising the total of:
for sale takes place.
> the post-tax profit or loss of discontinued operations; and
Non-current assets (or disposal groups) and liabilities of di-
> the post-tax gain or loss recognized on the measurement
sposal groups classified as held for sale are presented sepa-
to fair value less costs to sell or on the disposal of the
rately from other assets and liabilities in the balance sheet.
assets or disposal groups constituting the discontinued
The amounts presented for non-current assets or for the
operation.
assets and liabilities of disposal groups classified as held
The corresponding amount is re-presented in the income
for sale are not reclassified or re-presented for prior periods
statement for prior periods presented in the financial state-
presented.
ments, so that the disclosures relate to all operations that
Immediately before the initial classification of non-current
are discontinued by the end of the current reporting period.
assets (or disposal groups) as held for sale, the carrying
If the Group ceases to classify a component as held for
amounts of such assets (or disposal groups) are measured
sale, the results of the component previously presented in
in accordance with the IFRS-EU applicable to the specific
discontinued operations are reclassified and included in in-
assets or liabilities. Non-current assets (or disposal groups)
come from continuing operations for all periods presented.
classified as held for sale are measured at the lower of their
carrying amount and fair value less costs to sell. Impairment
losses for any initial or subsequent writedown of the assets
Revenue
(or disposal groups) to fair value less costs to sell and gains
Revenue is recognized to the extent that it is probable that
for their reversals are included in profit or loss from continu-
the economic benefits will flow to the Group and the amount
ing operations.
can be reliably measured. Revenue includes only the gross
Non-current assets are not depreciated (or amortized) while
inflows of economic benefits received and receivable by
they are classified as held for sale or while they are part of a
the Group on its own account. Therefore, in an agency rela-
disposal group classified as held for sale.
tionship, the amount collected on behalf of the principal are
If the classification criteria are no longer met, the Group cea-
excluded from revenue.
ses to classify non-current assets (or disposal group) as held
Revenue is measured at the fair value of the consideration
for sale. In that case they are measured at the lower of:
received or receivable, taking into account the amount of any
> the carrying amount before the asset (or disposal group)
trade discounts and volume rebates allowed by the Group.
was classified as held for sale, adjusted for any deprecia-
When goods or services are exchanged or swapped for go-
tion, amortization or revaluations that would have been
ods or services which are of a similar nature and value, the
recognized if the asset (or disposal group) had not been
exchange is not regarded as a transaction which generates
classified as held for sale; and
revenue.
> the recoverable amount, which is equal to the greater of
In arrangements under which the Group will perform multi-
its fair value net of costs of disposal and its value in use,
ple revenue-generating activities (a multiple-element arran-
as calculated at the date of the subsequent decision not
gement), the recognition criteria are applied to the separa-
to sell.
tely identifiable components of the transaction in order to
Any adjustment to the carrying amount of a non-current as-
reflect the substance of the transaction or to two or more
set that ceases to be classified as held for sale is included in
transactions together when they are linked in such a way
profit or loss from continuing operations.
that the commercial effect cannot be understood without
A discontinued operation is a component of the Group that
reference to the series of transactions as a whole.
either has been disposed of, or is classified as held for sale,
More specifically, the following criteria are used depending
and:
on the type of transaction:
183
Consolidated financial statementsAnnual Report 2015 > revenue from the sale of goods is recognized when the
zed only to the extent of the expenses recognized that
significant risks and rewards of ownership of the goods
are recoverable;
are transferred to the buyer and their amount can be re-
> revenue associated with construction contracts is recogni-
liably determined;
zed as specified in the section “Construction contracts”;
> revenue from the sale of electricity and gas is recognized
> revenue from monetary and in-kind fees for connection
when these commodities are supplied to the customer
to the electricity distribution network is recognized in
and regard the quantities provided during the period,
full upon completion of connection activities if the ser-
even if these have not yet been invoiced. It is determi-
vice supplied is identified. If more than one separately
ned using estimates as well as periodic meter readings.
identifiable service is identified, the fair value of the total
Where applicable, this revenue is based on the rates and
consideration received or receivable is allocated to each
related restrictions established by law or the Authority for
service and the revenue related to the service performed
Electricity, Gas and the Water System (“the Authority“)
in the period is recognized; in particular, if any ongoing
and analogous foreign authorities during the applicable
services (electricity distribution services) are identified,
period;
the related revenue is generally determined by the terms
> revenue from the transport of electricity is recognized
of the agreement with the customer or, when such an
when the services are rendered to distribution customers
agreement does not specify a period, over a period no
even if they have not yet been invoiced. That revenue is
longer than the useful life of the transferred asset;
determined on the basis of the amounts that have actually
> revenue from rentals and operating leases is recognized
transited along the distribution network, net of estimated
on an accruals basis in accordance with the substance of
losses. Where provided for in the specific local regulations,
the relevant agreement.
such revenue is adjusted to take account of the restrictions
and mandatory rates established by the Authority in Italy or
the equivalent national organizations in other countries. In
particular, in setting restrictions and mandatory rates, each
Financial income and expense from
derivatives
authority covers the costs incurred for investments in the
Financial income and expense from derivatives includes:
network, the associated remuneration based on an appro-
> income and expense from derivatives measured at fair
priate rate of return on capital and the timing with which
value through profit or loss on interest rate and exchange
those amounts are incorporated in rates.
risks;
Where the inclusion of the investments in rates, which
> income and expense from fair value hedge derivatives on
gives rise to the operator’s right to receive the amount, in
interest rate risk;
the year in which they are carried out is already virtually
> income and expense from cash flow hedge derivatives on
certain, the revenue is recognized on an accrual basis,
interest rate and exchange risks.
regardless of the financial mechanism used to pay it.
These arrangements reflect the provision of Authority Re-
solution 654/2015 concerning the definition of the criteria
Other financial income and expense
for the new rate period for distribution and metering in
For all financial assets and liabilities measured at amortized
force for the regulatory cycle (2016-2023). For more de-
cost and interest-bearing financial assets classified as availa-
tails on the changes introduced with that resolution, plea-
ble for sale, interest income and expense is recorded using
se see the report on operations;
the effective interest rate method. The effective interest rate
> revenue from the rendering of services is recognized by
is the rate that exactly discounts the estimated future cash
reference to the stage of completion of services at the
payments or receipts over the expected life of the financial
end of the reporting periods in which the services are
instrument or a shorter period, where appropriate, to the net
rendered. The stage of completion of the transaction is
carrying amount of the financial asset or liability.
determined based on an assessment of the service ren-
Interest income is recognized to the extent that it is proba-
dered as a percentage of the total services to be rende-
ble that the economic benefits will flow to the Group and the
red or as costs incurred as a proportion of the estimated
amount can be reliably measured.
total costs of the transaction. When it is not possible to
Other financial income and expense also includes changes in
reliably determine the value of the revenue, it is recogni-
the fair value of financial instruments other than derivatives.
184
Annual Report 2015 Income taxes
the same taxation authority that arise at the time of reversal
if a legally enforceable right to set-off exists.
Current income taxes
Current income taxes for the period, which are recognized
under “income tax payable” net of payments on account,
Dividends
or under “tax receivables” where there is a credit balance,
Dividends are recognized when the right to receive payment
are determined using an estimate of taxable income and in
is established.
conformity with the applicable regulations.
Dividends and interim dividends payable to a company’s sha-
In particular, such payables and receivables are determined
reholders are recognized as changes in equity in the period
using the tax rates and tax laws that are enacted or substan-
in which they are approved by the shareholders’ meeting
tively enacted as at the end of the reporting period.
and the board of directors, respectively.
Current income taxes are recognized in profit or loss with
the exception of current income taxes related to items re-
cognized outside profit or loss that are recognized in equity.
Deferred tax items
Deferred tax liabilities and assets are calculated on the tem-
porary differences between the carrying amounts of assets
and liabilities in the financial statements and their correspon-
ding values recognized for tax purposes on the basis of tax
rates in effect on the date the temporary difference will re-
verse, which is determined on the basis of tax rates that are
enacted or substantively enacted as at end of the reporting
period.
Deferred tax liabilities are recognized for all taxable tempo-
rary differences, except when the deferred tax liability arises
from the initial recognition of goodwill or in respect of taxa-
ble temporary differences associated with investments in
subsidiaries, associates and interests in joint arrangements,
when the Group can control the timing of the reversal of the
temporary differences and it is probable that the temporary
differences will not reverse in the foreseeable future.
Deferred tax assets are recognized for all deductible tempo-
rary differences, the carry forward of unused tax credits and
any unused tax losses, when recovery is probable, i.e. when
an entity expects to have sufficient future taxable income to
recover the asset.
The recoverability of deferred tax assets is reviewed at each
period-end.
Unrecognized deferred tax assets are re-assessed at each
reporting date and they are recognized to the extent that it
has become probable that future taxable profits will allow
the deferred tax asset to be recovered.
Deferred taxes are recognized in profit or loss, with the
exception of those in respect of items recognized outside
profit or loss that are recognized in equity.
Deferred tax assets and deferred tax liabilities are offset
against current tax liabilities relate to income taxes levied by
3
Recently issued accounting
standards
New accounting standards applied
in 2015
The Group adopted the following
interpretation and
amendments to existing standards with effect as from Ja-
nuary 1, 2015.
> “IFRIC 21 - Levies”; the interpretation addresses the ac-
counting treatment of a liability in respect of the obliga-
tion to pay a levy that is not covered by another standard
(for example, income taxes), other than fines or sanctions
imposed for violations of the law, due to the government,
whether local, national or international. More specifical-
ly, the interpretation established that the liability shall be
recognized when the obligating event giving rise to the
liability to pay the levy, as set out in the applicable law,
occurs. If the obligating event occurs over a specified pe-
riod of time (for example, the generation of revenue over
a specified period of time), the liability shall be recognized
gradually over that period. If the obligation to pay the levy
is triggered upon reaching a given threshold (for example,
upon reaching a minimum amount of revenue generated),
the corresponding liability is recognized at the time the
threshold is reached. The application of IFRIC 21 did not
give rise, on an annual basis, to any restatement of com-
parative figures, although during the year it did give rise
to a number of changes in the interim income statement.
> “Annual improvements to IFRSs 2011-2013 cycle”; the do-
cument contains formal modifications and clarifications
185
Consolidated financial statementsAnnual Report 2015 of existing standards. More specifically, the following
In order to determine how financial assets should be clas-
standards were amended:
sified and measured, consideration must be given to the
- “IFRS 3 - Business combinations”; the amendment
business model used to manage its financial assets and
clarifies that IFRS 3 does not apply to the financial sta-
the characteristics of the contractual cash flows. If the
tements of a joint arrangement in accounting for the
objective of the business model is to collect contractual
formation of the joint arrangement itself;
cash flows, financial assets are measured at amortized
- “IFRS 13 - Fair value measurement”; the amendment
costs. If however the objective is to collect contractual
clarifies that the exception provided for in that standard
cash flows and those from sales, they are measured at
of measuring financial assets and liabilities on the ba-
fair value through other comprehensive income (FVTOCI),
sis of the net exposure of the portfolio (the “portfolio
which enables the recognition of interest calculated using
exception”) shall apply to all contracts within the scope
the amortized cost method through profit or loss and the
of IAS 39 or IFRS 9 even if they do not meet the defini-
fair value of the financial asset through OCI. Financial as-
tions in IAS 32 of financial assets or liabilities;
sets at fair value through profit or loss (FVTPL) is now
- “IAS 40 - Investment property”; the amendment clari-
a residual category that comprises financial instruments
fies that management judgment must be used to de-
that are not held under one of the two business models
termine whether the acquisition of an investment pro-
indicated above.
perty represents the acquisition of an asset or group
As regards the classification and measurement of finan-
of assets or is a business combination under the provi-
cial liabilities, IFRS 9 maintains the accounting treatment
sions of IFRS 3. That judgment must be consistent with
envisaged in IAS 39, making limited amendments, for
the guidance of IFRS 3.
which most of such liabilities are measured at amortized
“Annual improvements to IFRSs 2011-2013 cycle” amen-
cost. The standard does introduce new provisions for fi-
ded the Basis for Conclusions of “IFRS 1 - First-time
nancial liabilities designated as fair value through profit
adoption of International Financial Reporting Standards”
or loss, under which in certain circumstances the portion
to clarify that a first-time adopter may adopt a new IFRS
of changes in fair value due to own credit risk shall be re-
whose adoption is not yet mandatorily effective if the
cognized through OCI rather than profit or loss. This part
new IFRS permits early application.
of the standard may be applied early, without having to
Accounting standards taking effect
at a future date
apply the entire standard.
Finally, the standard proposes a new model that gives
users of financial statements more information on “ex-
pected credit losses”, adopting a single approach for all
The following new standards, amendments and interpreta-
financial assets. It envisages:
tions take effect after December 31, 2015:
a) the recognition of expected credit losses on an ongoing
> “IFRS 9 - Financial instruments”; the final version was is-
basis and the updating of the amount of such losses
sued on July 24, 2014, replacing the existing “IAS 39 - Fi-
at the end of each reporting period, with a view to re-
nancial instruments: recognition and measurement” and
flecting changes in the credit risk of the financial instru-
supersedes all previous versions of the new standard.
ment;
The standard will take effect as from January 1, 2018 and
b) the measurement of expected losses on the basis of
early application will permitted following endorsement.
reasonable information, obtainable without undue cost,
The final version of IFRS 9 incorporates the results of the
about past events, current conditions and forecasts of
three phases of the project to replace IAS 39 concerning
future conditions;
classification and measurement, impairment and hedge
c) an improvement of disclosures on expected losses and
accounting.
credit risk.
As regards the classification of financial instruments,
IFRS 9 also introduces a new approach to hedge ac-
IFRS 9 provides for a single approach for all types of fi-
counting, enabling entities to reflect their risk manage-
nancial asset, including those containing embedded deri-
ment activities in the financial statements, extending the
vatives, under which financial assets are classified in their
criteria for eligibility as hedged items to the risk compo-
entirety, without the application of complex subdivision
nents of non-financial elements, to net positions, to layer
methods.
components and to aggregate exposures (e.g. a combi-
186
Annual Report 2015
nation of a non-derivative exposure and a derivative). The
once the contract has been identified, it must identify
most significant changes regarding hedging instruments
the performance obligations in the contract, recognizing
compared with the hedge accounting approach used in
separable goods or services as separate obligations; the
IAS 39 involve the possibility of deferring the time value
entity must then determine the transaction price, which
of an option, the forward element of forward contracts
is represented by the consideration that it expects to
and currency basis spreads (i.e. “hedging costs”) in OCI
obtain; the entity must then allocate the transaction price
up until the time in which the hedged element impacts
to the individual obligations identified in the contract on
profit or loss. IFRS 9 also eliminates the requirement for
the basis of the individual price of each separable good or
testing effectiveness under which the results of the retro-
service; revenue is recognized when (or if) each individual
spective test needed to fall with a range of 80%-125%,
performance obligation is satisfied through the transfer of
allowing entities to rebalance the hedging relationship if
the good or service to the customer, i.e. when the custo-
risk management objectives have not changed.
mer obtains control of the good or service.
The potential impact of the future application of IFRS 9 is
IFRS 15 also requires complete disclosure concerning the
still being assessed. The Group immediately established
nature, amount, timing and degree of uncertainty of the
specific working groups to conduct the assessment.
revenue and cash flows associated with contracts with
> “IFRS 14 - Regulatory deferral accounts”, issued in Ja-
customers.
nuary 2014. The standard allows first-time adopters to
The standard shall take effect, subject to endorsement,
continue to recognize rate-regulated amounts recognized
for periods beginning on or after January 1, 2018. The
under their previous GAAP at first-time adoption of the
Group is assessing the potential impact of the future ap-
International Financial Reporting Standards. The standard
plication of the standard. The Group immediately establi-
may not be adopted by entities that already prepare their
shed specific working groups to conduct the assessment.
financial statements in accordance with the IFRS/IAS. In
> “IFRS 16 - Leases”, issued in January 2016, replaces the
other words, an entity may not recognize rate-regulated
previous standard governing leases, IAS 17, and the as-
assets and liabilities under IFRS 14 if its current GAAP do
sociated interpretations. It establishes the criteria for the
not permit such recognition or if the entity has not adop-
recognition, measurement and presentation of leases for
ted such accounting treatment as permitted under its cur-
both the lessor and the lessee and the associated disclo-
rent GAAP. The standard shall take effect retrospectively,
sures. Although IFRS 16 does not modify the definition
subject to endorsement, for periods beginning on or after
of a lease contract set out in IAS 17, the main change is
January 1, 2016. The application of the standard will have
represented by the introduction of the concept of control
no impact on the Group.
within that definition. More specifically, in order to de-
> “IFRS 15 - Revenue from contracts with customers”, is-
termine whether a contract represents a lease, IFRS 16
sued in May 2014, will replace “IAS 11 - Construction con-
requires the lessee to determine whether it has the right
tracts”, “IAS 18 - Revenue”, “IFRIC 13 - Customer loyalty
to control the use of a given assets for a specified period
programmes”, “IFRIC 15 - Agreements for the construc-
of time. IFRS 16 eliminates the distinction between ope-
tion of real estate”, “IFRIC 18 - Transfers of assets from
rating and finance leases, as required under IAS 17, intro-
customers” and “SIC 31 - Revenue - Barter transactions
ducing a single method for recognizing all leases. Under
involving advertising services” and will apply to all con-
the new approach, the lessee must recognize:
tracts with customers, with a number of exceptions (for
a) in the balance sheet, the assets and liabilities in re-
example, lease and insurance contracts, financial instru-
spect of all leases with a term of more than 12 months,
ments, etc.). The new standard establishes a general fra-
unless the underlying asset is of low value; and
mework for the recognition and measurement of revenue
b) in the income statement, the depreciation of the assets
based on the principle that revenue shall be recognized
involved in the lease contract separately from the inte-
in a manner that faithfully depicts the transfer of goods
rest connected with the associated liabilities.
and services to customers in an amount that reflects the
For lessors, IFRS 16 essentially retains the recognition
consideration to which the entity expects to be entitled in
requirements provided for under IAS 17. Accordingly, the
exchange for those goods or services. The fundamental
lessor shall continue to classify and recognize leases
principle will be applied on the basis of five key phases:
as operating or finance leases. The standard will apply,
the entity must identify the contract with the customer;
subject to endorsement, for periods beginning on or after
187
Consolidated financial statementsAnnual Report 2015
January 1, 2019. The Group is assessing the potential im-
1, 2017. The Group does not expect the future application
pact of the future application of the standard.
of the amendments to have an impact.
> “Amendments to IAS 1 - Disclosure initiative”, issued in
> “Amendments to IAS 12 - Recognition of deferred tax
December 2014. The amendments form part of a broader
assets for unrealised losses”, issued in January 2016.
initiative to improve presentation and disclosure require-
The amendments clarify the recognition of deferred tax
ments, including changes in the following areas:
assets in respect of debt instruments measured at fair
- materiality: the amendments clarify that the concept
value. More specifically, the amendments clarify the re-
of materiality applies to all parts of the financial state-
quirements for recognizing deferred tax assets for unrea-
ments and that the inclusion of immaterial information
lized losses in order to eliminate differences in accounting
could undermine the utility of financial disclosures;
treatment. The amendments will take effect, subject to
- disaggregation and subtotals: the amendments clarify
endorsement, for periods beginning on or after January
that the line items in the income statement, the state-
1, 2017. Early application is permitted. The Group is asses-
ment of comprehensive income and the balance sheet
sing the potential impact of the future application of the
may be disaggregated. They also introduce new requi-
amended standard.
rements concerning the use of subtotals;
> “Amendments to IAS 19 - Defined benefit plans: em-
-
the structure of the notes: the amendments clarify that
ployees contributions”, issued in November 2013. The
entities have a certain degree of flexibility in the order
amendments are intended to clarify how to recognize
in which the notes to the financial statements may be
contributions from employees within a defined benefit
presented. They also emphasize that in establishing
plan. More specifically, contributions linked to service
that order the entity must consider the requirements
should be recognized as a reduction in service cost:
of understandability and comparability of the financial
- over the periods in which employees render their servi-
statements;
ces, if the amount of the contributions is dependent on
-
investments accounted for using the equity method:
the number of years of service; or
the entity’s share of OCI of investments in equity-ac-
-
in the period in which the service is rendered, if the
counted associates and joint ventures must be split
amount of the contributions is independent of the num-
between the portion recyclable and that not recyclable
ber of years of service.
to profit and loss; such portion must be presented as
The amendments will take effect for the Group as from
separate line items in the statement of comprehensive
January 1, 2016. The Group does not expect the future
income depending whether they will subsequently be
application of the amendments to have an impact.
reclassified to profit or loss.
> “Amendments to IAS 27 - Equity method in separate finan-
The amendments will take effect for periods beginning on
cial statements” issued in August 2014. The amendments
or after January 1, 2016. The Group does not expect the
permit the use of the equity method for investments in
future application of the amendments to have an impact.
subsidiaries, joint ventures and associates in an entity’s
> “Amendments to IAS 7 - Disclosure initiative”, issued in
separate financial statements. The amendments also cla-
January 2016. The amendments apply to liabilities and
rify a number of issues concerning investment entities.
assets arising from financing activities, which are defi-
Specifically, when an entity ceases to be an investment
ned as liabilities and assets for which cash flows were,
entity, it must recognize investments in subsidiaries
or will be, classified in the statement of cash flows as
in accordance with IAS 27. Conversely, when an entity
“cash flows from financing activities”. The amendments
becomes and investment entity, it must recognize in-
require disclosure of changes in such liabilities/assets, di-
vestments in subsidiaries at fair value through profit or
stinguishing between cash flow changes and non-cash
loss in accordance with IFRS 9. The amendments will
variations (i.e. variations arising from obtaining or losing
take effect for periods beginning on or after January 1,
control of a subsidiary or other businesses, the effect of
2016. As the amendments regard the separate financial
changes in foreign exchange rates and changes in fair va-
statements only, they are not expected to have an impact
lues). The IASB suggests providing such disclosure in a
on the consolidated financial statements.
reconciliation between the opening and closing balances
> “Amendments to IFRS 11 - Accounting for acquisitions
for the period for such liabilities/assets. The amendments
of interests in joint operations”, issued in May 2014. The
will take effect for periods beginning on or after January
amendments clarify the accounting treatment of the ac-
188
Annual Report 2015 quisition of an interests in a joint operation that is busi-
The Group does not expect the future application of the
ness, pursuant to IFRS 3, requiring the application of all
amendments to have an impact.
the accounting rules for business combinations under
> “Amendments to IFRS 10 and IAS 28 - Sale or contribution
IFRS 3 and other applicable IFRS with the exception of
of assets between an investor and its associate or joint
those standards that conflict with the guidance on IFRS
venture”, issued in September 2014. The amendments
11. Under the amendments, a joint operator that acquires
establish that in the case of the sale or contribution of as-
such interests must measure the identifiable assets and
sets to a joint venture or an associate, or the sale of an in-
liabilities at fair value; expense acquisition-related costs
terest that gives rise to a loss of control while maintaining
(with the exception of debt or equity issuance costs); re-
joint control or significant influence over the associate or
cognize deferred taxes; recognize any goodwill or bargain
joint venture, the amount of the gain or loss recognized
purchase gain; perform impairment tests for the cash ge-
shall depend on which of the assets or interest constitute
nerating units to which goodwill has been allocated; and
a business in accordance with “IFRS 3 - Business com-
disclose information required for relevant business com-
binations”. More specifically, if the assets/interest consti-
binations. The amendments will take effect for periods
tute a business, any gain/(loss) shall be recognized in full;
beginning on or after January 1, 2016.
if the assets/interest does not constitute a business, any
> “Amendments to IAS 16 and IAS 38 - Clarification of
gain/(loss) shall only be recognized to the extent of the
acceptable methods of depreciation and amortization”,
unrelated investors’ interests in the associate or joint ven-
issued in May 2014. The amendments provide additio-
ture, who represent the counterparties in the transaction.
nal guidance on how the depreciation or amortization
The EFRAG has recommended that the European Com-
of property, plant and equipment and intangible assets
mission postpone endorsement of the amendments until
should be calculated. The provisions of IAS 16 have been
the IASB completes its project on the elimination of gains
amended to clarify that a revenue-based depreciation me-
and losses on transactions between an entity and its as-
thod asset is not appropriate. The provisions of IAS 38
sociates or joint ventures.
have been amended to introduce a presumption that a
> “Amendments to IFRS 10, IFRS 12 and IAS 28 - In-
revenue-based amortization method is inappropriate. That
vestment entities: applying the consolidation exception”,
presumption can be overcome when:
issued in December 2014. The amendments clarify that if
-
the intangible asset is expressed as a measure of re-
a parent entity (or intermediate parent) prepares its finan-
venue;
cial statements in conformity with IFRS 10 (including the
-
it can be demonstrated that revenue and the con-
case of an investment entity that does not consolidate
sumption of the economic benefit generated by an in-
its investments in subsidiaries but rather measures them
tangible asset are highly correlated.
at fair value), the exemption from preparing consolida-
The amendments will take effect prospectively for pe-
ted financial statements is available to the subsidiaries
riods beginning on or after January 1, 2016. The Group
of an investment entity that in turn qualify as investment
is assessing the impact of the future application of the
entities. In addition, the amendments also clarify that a
amendments.
parent entity that qualifies as an investment entity must
> “Amendments to IAS 16 and IAS 41 - Bearer plants”,
consolidate a subsidiary that provides services related to
issued in June 2014. The amendments change the ac-
the parent’s investment activities if the subsidiary is not
counting treatment of biological assets that meet the
itself an investment entity. The amendments also sim-
definition of “bearer plants”, such as fruit trees, that cur-
plify application of the equity method for an entity that
rently fall within the scope of “IAS 16 - Property, plant
is not an investment entity but holds an interest in an
and equipment”. As a consequence, they will be subject
associate or joint venture that is an investment entity. In
to all of the provisions of that standard. Accordingly,
particular, when applying the equity method, the entity
for measurement subsequent to initial recognition, the
may retain the fair value measurement applied by the
entity may choose between the cost model and the re-
associate or joint venture to its interests in subsidiaries.
valuation model. The agricultural products produced by
The amendments will take effect, subject to endorse-
the bearer plants (e.g. fruit) will remain within the scope
ment, for periods beginning on or after January 1, 2016.
of “IAS 41 - Agriculture”. The amendments will take ef-
The Group does not expect the future application of the
fect for periods beginning on or after January 1, 2016.
amendments to have an impact.
189
Consolidated financial statementsAnnual Report 2015 > “Annual improvements to IFRSs 2010-2012 cycle”, issued
sclosures required under IAS 24 for related parties. The
in December 2013; the document contains formal modifi-
amendment also clarifies that if an entity obtains key
cations and clarifications of existing standards applicable
management personnel services from a management
to the Group as from January 1, 2016 that are not ex-
entity, the entity is not required to disclose the com-
pected to have a significant impact on the Group. More
pensation paid or payable by the management entity to
specifically, the following standards were amended:
those managers;
- “IFRS 2 - Share-based payment”; the amendment se-
- “IAS 38 - Intangible assets”; the amendment clarifies
parates the definitions of “performance conditions”
that when an intangible asset is revalued, its gross
and “service conditions” from the definition of “ve-
carrying amount shall be adjusted in a manner consi-
sting conditions” in order to clarify the description of
stent with the revaluation of the carrying amount. In
each condition;
addition, it also clarifies that the accumulated amortiza-
- “IFRS 3 - Business combinations”; the amendment
tion shall be calculated as the difference between the
clarifies how to classify any contingent consideration
gross carrying amount and the carrying amount of the
agreed in a business combination. Specifically, the
asset after taking account of accumulated impairment
amendment establishes that if the contingent consi-
losses.
deration meets the definition of financial instrument, it
“Annual improvements to IFRSs 2010-2012 cycle” amen-
shall be classified as a financial liability or equity. In the
ded the Basis for Conclusions of “IFRS 13 - Fair value
former case, the liability shall be measured at fair value
measurement” to clarify that short-term receivables and
and changes in fair value shall be recognized in profit
payables with no stated interest rate to apply to the invoi-
or loss in accordance with IFRS 9. Contingent consi-
ce amount can still be measured without discounting, if
deration that does not meet the definition of financial
the impact of discounting would not be material.
instrument shall be measured at fair value and changes
> “Annual improvements to IFRSs 2012-2014 cycle”, issued
in fair value shall be recognized in profit or loss;
in September 2014; the document contains formal modi-
- “IFRS 8 - Operating segments”; the amendments in-
fications and clarifications of existing standards that are
troduce new disclosure requirements in order to ena-
not expected to have a significant impact on the Group.
ble the users of financial statements to understand
More specifically, the following standards were amended:
the judgments adopted by management in aggregating
- “IFRS 5 - Non-current assets held for sale and disconti-
operating segments and the reasons for such aggrega-
nued operations”; the amendments clarify that the re-
tion. The amendments also clarify that the reconciliation
classification of an asset (or disposal group) from held
of total segment assets and total assets of the entity is
for sale to held for distribution should not be conside-
required only if provided periodically by management;
red as a new plan of sale but rather the continuation of
- “IAS 16
- Property, plant and equipment”; the
the original plan. Accordingly, the reclassification does
amendment clarifies that, when an item of property,
not give rise to any interruption in the application of the
plant and equipment is revalued, the gross carrying
provisions of IFRS 5 or any change in the date of clas-
amount of that asset shall be adjusted in a manner con-
sification. The amendments will take effect for periods
sistent with the revaluation of the carrying amount. In
beginning on or after January 1, 2016;
addition, it also clarifies that the accumulated deprecia-
- “IFRS 7 - Financial instruments: disclosures”; as re-
tion shall be calculated as the difference between the
gards disclosures to be provided on any continuing
gross carrying amount and the carrying amount of the
involvement in assets that have been transferred and
asset after taking account of accumulated impairment
derecognized in their entirety, the amendments clarify
losses;
that for disclosure purposes, a servicing contract that
- “IAS 24 - Related party disclosures”; the amendment
provides for the payment of a fee can represent a con-
clarifies that a management entity, i.e. an entity provi-
tinuing involvement in the transferred asset. The entity
ding key management personnel services to an entity,
must assess the nature of the fee and the servicing
is a related party of that entity. Accordingly, in addition
contract to determine when disclosure is required. The
to fees for services paid or payable to the management
amendments also clarify that disclosures concerning
entity, the entity must report other transactions with
the offsetting of financial assets and liabilities are not
the management entity, such as loans, within the di-
required in condensed interim financial statements.
190
Annual Report 2015 The amendments will take effect for periods beginning
on or after January 1, 2016;
- “IAS 19 - Employee benefits”; IAS 19 requires that the
discount rate used to discount post-employment bene-
fit obligations shall be determined by making reference
to market yields on high quality corporate bonds or go-
4
Restatement of comparative
disclosures
vernment bonds where there is not deep market in such
Newly applied accounting standards or newly adopted ac-
high quality corporate bonds. The amendment to IAS 19
counting policies did not give rise to the restatement of
clarifies that the depth of the market in high quality cor-
comparative disclosures at December 31, 2014.
porate bonds must be assessed on the basis of the cur-
More specifically, as a result of the application, starting from
rency in which the bond is denominated and not the cur-
January 1, 2015 with retrospective effect, of the new stan-
rency of the country in which the bond is issued. If there
dard “IFRIC 21 - Levies”, under which a tax liability is reco-
is no deep market in high quality corporate bonds in that
gnized when the obligating event giving rise to the liability
currency, the corresponding market yield on government
to pay the levy, as set out in the applicable law, occurs, a
bonds shall be used. The amendments will take effect
number of indirect taxes on real estate held in Spain were
for periods beginning on or after January 1, 2016;
recognized in the full amount at the start of the period and
- “IAS 34 - Interim financial reporting”; the amendment
no longer deferred over the course of the year. This approach
establishes that the required disclosures for interim fi-
simply involves the redistribution of the expenses among
nancial reports shall be provided in the interim financial
the various interim periods, but has no restatement impact
statements or cross-referenced in the interim financial
on figures for performance and financial position as they re-
statements by way of a reference to another statement
gard the entire year ending and as at December 31, 2014.
(e.g. a management risk report) that is available on the
same terms and at the same time to users of the in-
In addition, as regards the structure of “cash flows from
terim financial statements. The amendments will take
operating activities” in the consolidated statement of cash
effect for periods beginning on or after January 1, 2016.
flows, whose overall value was unchanged, the items that
compose cash flows from operating activities have been
reported in greater detail, which led to the corresponding
reclassification of certain items for 2014 in order to ensure
the comparability of the figures.
As from the 2015 financial year, the new organizational mo-
del of the Enel Group can be considered fully operational.
The future adoption of the model was first announced on
July 31, 2014, at the time of the presentation of the new
organizational structure.
In 2015, the new organization, based on a matrix that com-
prises Divisions (Global Generation, Global Infrastructure
and Networks, Renewable Energy, Global Trading, Upstream
Gas) and Regions/Countries (Italy, Iberian Peninsula, Latin
America and Eastern Europe), represented the basis of plan-
ning, reporting and assessing the financial performance of
the Group, both internally by top management and in rela-
tions with the financial community.
In view of these developments, it has also become neces-
sary to review disclosures under “IFRS 8 - Operating seg-
ments”, as reported in note 5 below, which have also been
supplemented with restated comparative figures to ensure
full comparability.
191
Consolidated financial statementsAnnual Report 2015 5
Main changes in the scope of
consolidation
> disposal in December 2014 of 100% of Enel Green Power
France, a renewables generator in France.
In addition, following the internal reorganization of the Group
designed to restructure the holdings of the Iberia and Latin
America Division, there were a number of changes in non-
In the two periods under review, the scope of consolidation
controlling interests in a number of subsidiaries as a result
changed as a result of a number of transactions.
of the following transactions:
2014
> acquisition, through a tender offer in effect between Janua-
ry 14, 2014 and May 16, 2014, of an additional 15.18% sta-
> Loss of control, as from January 1, 2014, of SE Hydro-
ke in Coelce, an electricity distribution company in Brazil,
power, under agreements signed in 2010 upon the ac-
already under the Group’s control prior to the tender offer;
quisition of the company, providing for the change in
> acquisition, on September 4, 2014, of the remaining 39%
governance structure as from that date. This resulted in
of Generandes Perú (previously controlled through a sta-
the Enel Group no longer meeting the requirements for
ke of 61%), a company that controls, with an interest of
control of the company, which has instead become an
54.20%, Edegel, a company operating in the power gene-
entity under joint control. With these new governance ar-
ration sector in Peru;
rangements, the investment was reclassified as a joint
> disposal, on October 23, 2014, by Endesa (of which the
operation under IFRS 11;
Group holds 92.06%) to Enel Energy Europe, now Enel
> acquisition, on April 22, 2014, of 50% of Inversiones Gas
Iberoamérica (a wholly-owned subsidiary) of 100% of En-
Atacama, a company operating in the natural gas tran-
desa Latinoamérica (an investment holding company that
sport and electricity generation sector in Chile in which
owned 40.32% of Enersis) and 20.30% of Enersis, the
the Group already held 50%; therefore, as from that date
parent company for operations in Latin America. The ope-
the company is consolidated on a line-by-line basis rather
ration increased the Group’s stake in Enersis by 4.81%;
than using equity method accounting;
> disposal, on November 21, 2014, of 21.92% of Endesa in
> acquisition, on May 12, 2014, of 26% of Buffalo Dunes
a public offering.
Wind Project, a company operating in the wind gene-
ration sector in the United States in which the Group
already held 49%; therefore, following the acquisition of
2015
control the company is now consolidated on a line-by-line
> Acquisition, on March 6, 2015, of the share not previously
basis rather than using equity method accounting;
held by the Group, amounting to 66.7%, of 3Sun, a pho-
> acquisition, on July 22, 2014, of the remaining 50% of
tovoltaic firm. Through this acquisition, the Group obtai-
Enel Green Power Solar Energy, an Italian company
ned control of the company, which is now consolidated
operating in the development, design, construction and
on a line-by-line basis;
operation of photovoltaic plants, in which the Group had
> acquisition, on September 24, 2015, acting through the
previously held 50%; therefore, the company is now con-
subsidiary Enel Green Power, of a controlling interest of
solidated on a line-by-line basis rather than using equity
68% in BLP Energy (“BLP”), a company operating in the
method accounting;
renewables sector in India;
> acquisition, on September 17, 2014, of 100% of Osage
> acquisition, in September 2015, of the remaining 60% of
Wind LLC, a company that owns a 150 MW wind deve-
the ENEOP Group, identified in a split agreement with
lopment project in the United States. In October 2014,
the other participants in the venture, with the acquisition
a stake of 50% in the company was sold. Consequen-
being settled with the concomitant transfer of the 40%
tly, the company, held as a joint venture, began to be ac-
that Enel Green Power held in the other two portfolios
counted for using the equity method;
transferred to the other partners in the consortium;
> disposal in December 2014 of the entire stake (36.2%)
> disposal, on November 26, 2015, of the ENEOP Group
held in LaGeo, a geothermal generation company in El
and other Portuguese companies in which Enel Green
Salvador;
Power held an interest;
192
Annual Report 2015 > full consolidation, following changes in shareholders’
sent transactions involving the acquisition or loss of control,
agreements, in December 2015, of Osage Wind LLC, a
gave rise to a change in the interest held by the Group in the
company 50% held by Enel Green Power North America,
investees:
previously accounted for using the equity method;
> disposal, on January 29, 2015, of SF Energy, a hydroelec-
> acquisition of a controlling interest of 78.6% in Erdwärme
tric generation company in Italy;
Oberland GmbH (“EO”), a company specialized in the de-
> disposal, on March 31, 2015, of 49% of EGPNA Renew-
velopment of geothermal projects in Germany;
able Energy Partners, an electricity generation company
> contribution, on December 31, 2015, of the former whol-
in the United States. Since the Group has maintained
ly-owned subsidiaries Altomonte, Enel Green Power San
control of the company, the transaction is one involving a
Gillio and Enel Green Power Strambino Solar to an equal-
non-controlling interest;
ly held joint venture (Ultor) with the fund F2i accounted
> disposal, on April 15, 2015, of SE Hydropower, a hydroe-
for using the equity method.
lectric generation company in Italy;
In addition to the above changes in the scope of consolida-
Energia Eolica, a wind generation company operating in
tion, the following transactions, although they do not repre-
Italy in which the Group already held an interest of 51%.
> acquisition, on April 8, 2015, of the remaining 49% of
Definitive allocation of the purchase
price for the acquisition of 3Sun
On March 6, 2015, Enel Green Power completed the acqui-
sition of an additional 66.7% stake in 3Sun from STM and
Sharp as provided for under the agreement signed between
the parties in July 2014.
Therefore, as a result of this acquisition, the Group has full
ownership of 3Sun, and the company is now consolidated
on a line-by-line basis rather than using the equity method.
As provided for under IFRS 3 Revised, the transaction qua-
lifies as a step acquisition and, therefore, the fair value
adjustments of the part of the net assets already held were
recognized through profit or loss for the period.
Having completed the purchase price allocation process, the
following table reports the definitive fair values of the assets
acquired and liabilities and contingent liabilities assumed at
the acquisition date.
Millions of euro
Property, plant and equipment
Intangible assets
Deferred tax assets
Other current and non-current assets
Total assets
Shareholders’ equity attributable to the shareholders of the Parent Company
Financial debt
Trade payables
Deferred tax liabilities and other liabilities
Total liabilities and shareholders’ equity
Definitive amounts recognized
at the acquisition date
122
7
84
93
306
115
140
25
26
306
As shown in the following table, the transaction resulted in the recognition of negative goodwill of €76 million, but did not
have an impact on cash flows.
193
Consolidated financial statementsAnnual Report 2015 Effects of the transaction
Millions of euro
Transaction price
Net assets of acquiree following definitive allocation
Carrying amount of interest held previously
Remeasurement at fair value of interest held previously
Negative goodwill
-
115
(1)
40
76
Definitive allocation of the purchase
price for the acquisition of a
number of companies in South
Africa
During 2015, the Group, acting through its subsidiary Enel
Green Power, was awarded contracts for the start of new
wind projects in South Africa for a total installed capacity
of 705 MW in the fourth phase of the Renewable Energy
Independent Power Producer Procurement Programme
(REIPPPP) tender.
This led to the acquisition of a number of projects represen-
ting businesses that were accounted for in accordance with
the provisions of IFRS 3 Revised.
The consideration for each of those transactions includes a
fixed component and contingent consideration depending
on winning the tender. Accordingly, in 2015 the definitive fair
values of the assets acquired and the liabilities and contin-
gent liabilities assumed were determined.
The main adjustments essentially regard the adjustment of
the value, net of tax effects, of a number of intangible assets.
The allocation of the total cost of the transaction led to the
recognition of negative goodwill of €12 million.
Effects of the transaction
Millions of euro
Intangible assets
Other assets
Total assets
Deferred tax liabilities
Total liabilities
Total net assets of the acquiree
Millions of euro
Transaction price
Net assets of acquiree following definitive allocation
Negative goodwill
Cash and cash equivalents acquired
Cash and cash equivalents paid
Cash flow impact
Carrying amount at the
acquisition date
Fair value adjustments
Amounts recognized at the
acquisition date
-
-
-
-
-
-
76
-
76
21
21
55
76
-
76
21
21
55
43
55
(12)
-
6
(6)
Disposal of interest in EGPNA
Renewable Energy Partners
which will be consolidated on a line-by-line basis, and will conti-
nue to be responsible for administration, operation and mainte-
On March 31, 2015, the Group, acting through its subsidiary Enel
Green Power North America, entered into an agreement for the
sale of a 49% stake in a newly created company, EGPNA Re-
newable Energy Partners, whose portfolio contains a number
of companies operating primarily in the wind and hydroelectric
power sector.
The Group continues to indirectly own 51% of the company,
nance activities.
The disposal involved a total price of €458 million (collected in
full), which, excluding transaction costs of €8 million, gave rise to
a transaction value of €450 million, taking into account the value
assigned to certain projects subject to conditions that had not
yet been entirely met as of the date of this report.
The gain on the transaction, calculated as the difference betwe-
en the net sale price and the percentage of shareholders’ equity
194
Annual Report 2015 sold to non-controlling interests, is equal to €14 million and was
interests, since the Group has maintained control over the com-
allocated to an equity reserve for transactions in non-controlling
pany.
Effects of the transaction
Millions of euro
Value of the transaction (1)
Net assets transferred
Reserve for transactions in non-controlling interests
- of which attributable to the shareholders of the Parent Company
- of which attributable to non-controlling shareholders
(1) Net of transaction costs.
450
436
14
10
4
Acquisition of 68% of BLP Energy
The process of allocating the purchase price to the fair va-
On September 24, 2015 the Group, acting through Enel Gre-
lues of the assets acquired and the liabilities and contingent
en Power, acquired a controlling stake of 68% in BLP Energy
liabilities assumed is not yet definitive and will be completed
(“BLP”), a company operating in the renewables industry in
within 12 months of the acquisition date.
India, which owns wind plants with a total installed capacity of
The non-controlling interest in the company was determined
172 MW, generating a total of about 340 GWh per year. The tran-
in proportion to the minority interest in the net identifiable
saction qualifies as a business combination and was accounted
assets of the acquiree.
for in accordance with the provisions of IFRS 3 Revised.
Effects of the transaction
Millions of euro
Property, plant and equipment
Cash and cash equivalents
Goodwill
Other current and non-current assets
Total assets
Financial debt
Deferred tax liabilities
Other current and non-current liabilities
Total liabilities
Non-controlling interests
Total net assets acquired
Millions of euro
Transaction price
Net assets acquired following provisional allocation
Goodwill
Cash and cash equivalents acquired
Cash and cash equivalents paid
Cash flow impact
Carrying amount at the
acquisition date
Fair value adjustments
Amounts recognized at the
acquisition date
76
15
3
4
98
62
-
3
65
10
23
16
-
-
-
16
-
5
2
7
3
6
92
15
3
4
114
62
5
5
72
13
29
29
29
-
15
29
(14)
195
Consolidated financial statementsAnnual Report 2015 Reallocation of assets to
shareholders of the ENEOP
consortium
held in each of the other parties’ portfolios in exchange for
the residual interest held in the other portfolios by the com-
pany. More specifically, the assets allocated to EGP have a
In 2015, Enel Green Power (“EGP”), acting through its Spa-
net installed capacity of about 445 MW. Enel Green Power
nish and Portuguese subsidiaries, initiated an operation to
España then acquired an additional stake of 60% (for a fair
split the assets of the ENEOP consortium, in which it held
value of €96 million) from the other shareholders for its port-
a stake of 40%. In September 2015, EGP signed an agree-
folio, with the consequent acquisition of control (step acqui-
ment with the other consortium members with which each
sition) against the transfer of 40% of the assets to the other
acquired control of a specific portfolio of plants already iden-
two consortium members (with a fair value totaling about
tified in accordance with the terms of a split agreement si-
€80 million) and payment of compensation to rebalance the
gned previously, with the acquisition of the residual interest
weights of the various portfolios.
The following table reports the provisional fair values of the assets acquired and the liabilities and contingent liabilities assumed
at the date of acquisition of the portfolio.
Effects of the transaction
Millions of euro
Property, plant and equipment
Intangible assets
Goodwill
Cash and cash equivalents
Other current and non-current assets
Total assets
Loans
Other current and non-current liabilities
Total liabilities
Total net assets
Total net assets acquired (60%)
Carrying amounts at the
acquisition date
Fair value adjustments and
compensation among portfolios (1)
Amounts recognized at the
acquisition date
442
18
25
128
34
647
518
52
570
77
47
-
-
15
-
41
56
(28)
-
(28)
84
49
442
18
40
128
75
703
490
52
542
161
96
(1) Carried out to balance the exchange among the consortium participants.
Net of transaction costs, the transaction had a total impact
asurement at fair value (pursuant to IFRS 3 Revised) of the
on profit or loss of about €29 million as a result of the reme-
interest held previously.
Millions of euro
Transaction price (including cash compensation)
Net assets of acquiree following provisional allocation
Carrying amount of interest held previously
Remeasurement at fair value of interest held previously
Goodwill
96
161
36
29
-
The completion of the split of ENEOP meets the condition pre-
of all renewables assets held in Portugal, which occurred in
cedent for the closing of the agreement signed in September
November 2015, as described in the next section.
2015 with First State Wind Energy Investments for the sale
Disposal of 100% of Finerge Gestão
de Projectos Energéticos
ting through its subsidiary Enel Green Power España, com-
pleted the sale of all of the share capital of Finerge Gestão
On November 26, 2015, the Enel Green Power Group, ac-
de Projectos Energéticos to the Portuguese company First
196
Annual Report 2015 State Wind Energy Investments for a total of about €900
effects of consolidating ENEOP net of transaction costs,
million. The transaction closed following completion of the
amounting to about €29 million.
split of ENEOP and gave rise to a capital gain, including the
Creation of an equally-held joint
venture in the Italian photovoltaic
industry
with effect from December 31, 2015.
The transaction, which involved the loss of control of those
assets, had a fair value of €111 million (see note 22) and a
During the 4th Quarter of 2015, the Enel Green Power Group
total impact on profit or loss of €11 million, including the
transferred part of its solar assets in Italy to a new equally
remeasurement at fair value (in accordance with IFRS 10) of
held joint venture with F2i Energie Rinnovabili Srl under the
the interest previously held and transferred to the new joint
provisions of the agreement signed on October 16, 2015,
venture.
197
Consolidated financial statementsAnnual Report 2015 6
Segment information
The representation of performance and financial position
order to pursue and maintain technological leadership in the
by business area presented here is based on the approach
sectors in which the Group operates, ensuring operational
used by management in monitoring Group performance for
excellence, and to maximize the level of service offered to
the two periods being compared.
customers in local markets.
On July 31, 2014, the Enel Group adopted a new organi-
For more information on performance and financial deve-
zational structure, based on a matrix of Divisions and geo-
lopments during the year, please see the dedicated section
graphical areas, focused on the industrial objectives of the
in the report on operations.
Group, with clear specification of roles and responsibilities in
Segment information for 2015 and 2014
Results for 2015 (1)
Millions of euro
Italy
Iberian
Peninsula
Latin
America
Eastern
Europe
Renewable
Energy
Other,
eliminations
and
adjustments
Total
Revenue from third parties
38,155
19,644
10,599
4,488
2,747
25
75,658
Revenue from transactions
with other segments
Total revenue
Total costs
Net income/(expense)
from commodity contracts
measured at fair value
Depreciation and
amortization
Impairment losses
Reversals of impairment
losses
Operating income
1,489
39,644
33,747
461
20,105
17,002
201
8
1,479
583
31
4,005
1,526
409
(221)
1,397
985
28
10,627
7,456
(4)
876
69
(19)
2,241
1,819
343
4,831
3,506
(17)
283
1,539
(15)
(499)
229 (3)
264
3,011
1,160
(25)
689
259
(1)
879
2,466
(2,585)
(2,560)
(2,342)
5
34
119
(28)
(338)
52
-
75,658
60,529
168
4,887
2,978
(253)
7,685
7,113
Capital expenditure
1,562 (2)
(1) Segment revenue includes both revenue from third parties and revenue flows between the segments. An analogous approach was taken for other income
and costs for the period.
(2) Does not include €1 million regarding units classified as “held for sale”.
(3) Does not include €648 million regarding units classified as “held for sale”.
198
Annual Report 2015 Results for 2014 restated (1) (2)
Millions of euro
Italy
Iberian
Peninsula
Latin
America
Eastern
Europe
Renewable
Energy
Other,
eliminations
and
adjustments
Total
Revenue from third parties
37,679
20,766
9,645
4,928
2,662
111
75,791
Revenue from transactions
with other segments
Total revenue
Total costs
Net income/(expense)
from commodity contracts
measured at fair value
Depreciation and
amortization
Impairment losses
Reversals of impairment
losses
Operating income
Capital expenditure
710
38,389
31,861
186
20,952
17,638
(185)
(111)
1,678
2,748
(1)
1,918
1,460
1,632
556
(225)
1,240
993
3
9,648
6,553
(3)
885
658
-
1,549
1,609
371
5,299
4,088
(1)
383
3,540
(37)
(2,676)
936
259
2,921
1,059
76
589
228
(3)
1,124
1,658
(1,529)
(1,418)
(1,390)
(1)
37
3
(1)
(68)
45
-
75,791
59,809
(225)
5,204
7,733
(267)
3,087
6,701
(1) Segment revenue includes both revenue from third parties and revenue flows between the segments. An analogous approach was taken for other income
and costs for the period.
(2) The figures have been restated to enable comparison with the results for 2015, which are presented on the basis of the new organization of the Enel Group,
which as from this year represents the basis for the planning, reporting and assessment of the performance and financial position of the Group, both inter-
nally by management and with respect to the financial community.
199
Consolidated financial statementsAnnual Report 2015 Financial position by segment
At December 31, 2015
Millions of euro
Property, plant and
equipment
Intangible assets
Trade receivables
Other
Italy
Iberian
Peninsula
Latin
America
Eastern
Europe
Renewable
Energy
22,441
1,075
8,655
3,513
23,294
14,844
2,228
1,445
11,589
10,197
1,777
465
5,767
904
366
567
Operating assets
35,684
41,811
24,028
7,604 (1)
13,894
1,994
451
476
16,815
1,270
282
437
783
2,130
1,312
4,225 (2)
1,989
Trade payables
Sundry provisions
Other
Operating liabilities
6,928
3,445
6,852
17,225
2,060
3,804
2,824
8,688
1,817
817
1,174
3,808
(1) Of which €4,231 million regarding units classified as “held for sale”.
(2) Of which €2,331 million regarding units classified as “held for sale”.
At December 31, 2014 restated (1)
Millions of euro
Property, plant and
equipment
Intangible assets
Trade receivables
Other
Italy
Iberian
Peninsula
Latin
America
Eastern
Europe
Renewable
Energy
22,518
1,237
7,832
3,963
23,865
14,817
2,185
1,488
11,950
11,572
1,656
798
6,702
912
409
501
11,765
2,248
440
599
Operating assets
35,550 (2)
42,355 (4)
25,976 (5)
8,524 (6)
15,052
Trade payables
Sundry provisions
Other
8,248
3,362
6,054
Operating liabilities
17,664 (3)
2,132
3,979
2,852
8,963
2,184
765
1,317
4,266
747
2,572
1,304
892
193
560
4,623 (7)
1,645
Other,
eliminations
and
adjustments
66
52
(621)
(389)
(892)
(805)
581
(718)
(942)
Other,
eliminations
and
adjustments
171
76
(420)
(350)
(523)
(493)
469
(576)
(600)
Total
77,051
29,066
12,856
6,077
125,050
12,053
11,059
11,881
34,993
Total
76,971
30,862
12,102
6,999
126,934
13,710
11,340
11,511
36,561
(1) The figures have been restated to enable comparison with the results for 2015, which are presented on the basis of the new organization of the Enel Group,
which as from this year represents the basis for the planning, reporting and assessment of the performance and financial position of the Group, both inter-
nally by management and with respect to the financial community.
(2) Of which €347 million regarding units classified as “held for sale”.
(3) Of which €22 million regarding units classified as “held for sale”.
(4) Of which €4 million regarding units classified as “held for sale”.
(5) Of which €10 million regarding units classified as “held for sale”.
(6) Of which €4,255 million regarding units classified as “held for sale”.
(7) Of which €2,790 million regarding units classified as “held for sale”.
200
Annual Report 2015 The following table reconciles segment assets and liabilities and the consolidated figures.
Millions of euro
Total assets
Equity investments accounted for using the equity method
Non-current financial assets
Long-term tax receivables included in “Other non-current assets”
Current financial assets
Derivatives
Cash and cash equivalents
Deferred tax assets
Income tax receivables
Long-term tax receivables included in “Other current assets”
Financial and tax assets of “Assets held for sale”
Segment assets (1)
Total liabilities
Long-term borrowings
Short-term borrowings
Current portion of long-term borrowings
Current financial liabilities
Derivatives
Deferred tax liabilities
Income tax payable
Other tax payables
Financial and tax liabilities included in disposal groups classified as “held for sale”
Segment liabilities (1)
at Dec. 31, 2015
at Dec. 31, 2014
161,179
166,634
607
3,274
463
2,381
7,416
10,639
7,386
636
706
2,621
125,050
109,428
44,872
2,155
5,733
1,063
7,027
8,977
585
990
3,033
34,993
872
3,645
501
3,984
6,835
13,088
7,067
788
759
2,161
126,934
115,489
48,655
3,252
5,125
1,177
7,882
9,220
253
887
2,477
36,561
(1) The figures have been restated to enable comparison with the results for 2015, which are presented on the basis of the new organization of the Enel Group,
which as from this year represents the basis for the planning, reporting and assessment of the performance and financial position of the Group, both inter-
nally by management and with respect to the financial community.
201
Consolidated financial statementsAnnual Report 2015 Revenue
7.a Revenue from sales and services - €73,076 million
Millions of euro
Revenue from the sale of electricity
Revenue from the transport of electricity
Fees from network operators
Transfers from equalization funds, market operators and
energy services operators
Revenue from the sale of natural gas
Revenue from the transport of natural gas
Revenue from fuel sales
Connection fees to electricity and gas networks
Revenue from the sale of environmental certificates
Revenue from other sales and services
Total
2015
46,638
9,911
826
1,152
4,045
509
7,104
829
343
1,719
73,076
2014
48,062
9,142
783
1,857
3,628
459
5,659
843
1,238
1,657
73,328
Change
(1,424)
769
43
(705)
417
50
1.445
(14)
(895)
62
(252)
-3.0%
8.4%
5.5%
-38.0%
11.5%
10.9%
25.5%
-1.7%
-72.3%
3.7%
-0.3%
In 2015 “revenue from the sale of electricity” amounted to
tary recognition of revenue for the entire previous regula-
€46,638 million (€48,062 million in 2014) and included sa-
tory period under the provisions of the temporary regime,
les of electricity to end users amounting to €29,994 million
amounted to €557 million, of which €100 million for 2015
(€29,933 million in 2014), sales of electricity to wholesale
investments. For more details on the regulatory changes,
buyers totaling €13,355 million (€14,428 million in 2014)
please see the appropriate section in note 2 “Accounting po-
and revenue from electricity trading activities amounting
licies and measurement criteria”.
to €3,289 million (€3,701 million in 2014). The decrease is
mainly attributable to the decline in quantities sold on natio-
In 2015, “transfers from equalization funds, market opera-
nal electricity exchanges and to foreign wholesale buyers, as
tors and energy services operators” amounted to €1,152
well as the effect of translating the ruble into euro following
million, down €705 million compared with the previous year.
the former’s significant depreciation.
This mainly reflected a decline in transfers in the extra-pe-
ninsular area of Spain, due to the increase in sales and the
“Revenue from the transport of electricity” amounted to
reduction in fuel prices.
€9,911 million in 2015, an increase of €769 million, largely
due to the increase in revenue from transportation to end
“Revenue from the sale of natural gas” amounted to €4,045
users connected to the Enel network (€258 million) and in
million in 2015 (€3,628 million in 2014), an increase of €417
revenue from other suppliers (€511 million). More specifical-
million, mainly reflecting the increase in sales in the Iberian
ly, the increase is essentially attributable to new regulation
Peninsula and on the domestic market, due to a sharp incre-
in Italy (Resolutions 654/2015 and 655/2014 of the Authority
ase in volumes traded accompanied by falling average unit
for Electricity, Gas and the Water System) which produced
prices.
an increase in electricity transport rates and resolved the
regulatory lag issue. The latter development will enable the
“Revenue from the transport of natural gas” amounted to
recognition, as from the current year, of revenue in respect
€509 million, up €50 million (+10.9%), which matched the
of the remuneration and regulatory amortization of eligible
increase in gas sales.
investments in the grid made during the year. That revenue
will be recognized in rates as from 2016 and 2017. The overall
“Revenue from fuel sales” amounted to €7,104 million, and
impact of the recognition, which also led to the supplemen-
in 2015 included sales of natural gas of €7,053 million (€5,536
202
Annual Report 2015 million in 2014) and sales of other fuels amounting to €51
“Revenue from the sale of environmental certificates” de-
million (€123 million in 2014). The sharp rise with respect to
creased by €895 million, largely due to a contraction in sales
the previous year reflects the increase in volumes traded.
of environmental certificates and CO2 emissions allowances.
The table below gives a breakdown of revenues from sales and services by geographical area.
Millions of euro
Italy
Europe
Iberian Peninsula
France
Switzerland
Germany
Austria
Slovenia
Slovakia
Romania
Greece
Bulgaria
Belgium
Czech Republic
Hungary
Russia
Netherlands
United Kingdom
Other European countries
Americas
United States
Canada
Mexico
Brazil
Chile
Peru
Colombia
Argentina
Other South American countries
Other
Africa
Asia
Total
2015
28,705
19,175
1,439
362
2,556
20
26
1,240
1,031
64
9
365
679
356
1,022
3,414
1,214
67
463
11
166
2,864
3,377
1,226
2,114
588
172
3
348
2014
28,567
20,378
1,375
711
3,154
4
22
1,367
1,046
61
8
256
813
141
1,336
113
3,105
179
455
-
135
3,100
2,820
1,034
2,087
453
158
1
449
73,076
73,328
203
Consolidated financial statementsAnnual Report 2015 7.b Other revenue and income - €2,582 million
Millions of euro
Operating grants
Grants for environmental certificates
Capital grants (electricity and gas business)
Sundry reimbursements
Gains on disposal and negative goodwill on acquisitions of
subsidiaries, associates, joint ventures, joint operations and non-
current assets held for sale
Gains on remeasurement at fair value after changes in control
Gains on disposal of property, plant and equipment and intangible
assets
Service continuity bonuses
Other revenue
Total
2015
8
874
17
239
313
80
52
65
934
2,582
2014
13
923
12
184
292
82
32
76
849
2,463
Change
(5)
(49)
5
55
21
(2)
20
(11)
85
119
-38.5%
-5.3%
41.7%
29.9%
7.2%
-2.4%
62.5%
-14.5%
10.0%
4.8%
“Grants for environmental certificates” decreased by €49
“Gains on remeasurement at fair value after changes in con-
million compared with the previous year. The item compri-
trol” amounted to €80 million. They mainly include the reme-
ses incentives granted to renewable generation plants or for
asurement at fair value of the assets and liabilities pertaining
energy efficiency initiatives.
to the Group (€40 million and €29 million) which Enel fully
owned prior to the acquisition of full control of 3Sun and
“Sundry reimbursements” regard sundry reimbursements
of the ENEOP consortium respectively. In 2014, this item
from customers and suppliers totaling €110 million (€46
reported remeasurement at fair value of the assets and lia-
million in 2014) and insurance indemnities in the amount
bilities pertaining to the Group: (i) remaining after the loss of
of €129 million (€86 million in 2014). The increase is due to
control as from January 1, 2014, of SE Hydropower following
more substantial insurance indemnities for damage to plants
changes in governance arrangements (€50 million); and (ii)
and to end-user reimbursements in Spain caused by fraudu-
already held by Enel prior to the acquisition of full control of
lent connections to the network.
Inversiones Gas Atacama (€29 million) and Buffalo Dunes
Wind Project (€3 million).
Gains on disposal and negative goodwill amounted to €313
million in 2015, up €21 million on 2014, mainly due to the
The increase in “Other revenue” mainly reflects revenue re-
impact of the proceeds from the disposal of SE Hydropo-
cognized in 2015 that was generated by the application of
wer (€141 million) and SF Energy (€15 million) and negative
regulatory amendments introduced in Argentina with Reso-
goodwill amounting to €76 million, from the acquisition of
lución 32/2015, which had a particular impact on Edesur with
control of 3Sun. Gains in 2014 were mainly accounted for
regard to the recognition of revenue and the Mecanismo de
by the adjustment of the price for Artic Russia (€82 million),
Monitoreo de Costos, with a total positive effect of €247
under the earn-out clause in the sale agreement with the
million, only partly offset by a reduction in other income regi-
buyer prior to the closing, and other gains in the renewables
stered by Enel Green Power, Endesa and other smaller com-
sector from the sale of LaGeo (€123 million) and Enel Green
panies amounting to about €162 million.
Power France (€31 million).
204
Annual Report 2015 Costs
8.a Electricity, gas and fuel purchases - €37,644 million
Millions of euro
Electricity
Gas
Nuclear fuel
Other fuels
Total
2015
22,218
11,710
250
3,466
37,644
2014
23,317
8,388
206
5,017
36,928
Change
(1,099)
3,322
44
(1,551)
716
-4.7%
39.6%
21.4%
-30.9%
1.9%
Purchases of “electricity” comprise those from the Acqui-
Purchases of “gas” increased by €3,322 million, largely due
rente Unico (Single Buyer) in the amount of €3,695 million
to an increase in intermediation activities on the fuel market.
(€4,395 million in 2014) and purchases from the Energy Mar-
Purchases of “nuclear fuel” reflected the increase in price
kets Operator (GME) in the amount of €1,553 million (€1,690
and greater quantities produced in Spain.
million in 2014). The decrease in the aggregate mainly re-
gards the reduction in costs for electricity purchases on elec-
Purchases of “other fuels” diminished by €1,551 million, to
tricity exchanges and on national and international markets,
€3,466 million in 2015, mainly due to the reduction in con-
essentially due to the decline in demand.
sumption in a context of falling prices.
8.b Services and other materials - €16,457 million
Millions of euro
Transmission and transport
Maintenance and repairs
Telephone and postal costs
Communication services
IT services
Leases and rentals
Building services
Insurance services
Professional and technical services
Fees and commissions
Services and other expenditure connected with personnel
Materials and services for service concession arrangements
Other services
Other materials
Total
2015
9,118
1,213
209
104
364
577
137
229
190
302
204
318
2,414
1,078
16,457
2014
8,979
1,301
221
115
305
609
133
118
186
251
218
246
2,222
2,275
17,179
Change
139
(88)
(12)
(11)
59
(32)
4
111
4
51
(14)
72
192
(1,197)
(722)
1.5%
-6.8%
-5.4%
-9.6%
19.3%
-5.3%
3.0%
94.1%
2.2%
20.3%
-6.4%
29.3%
8.6%
-52.6%
-4.2%
205
Consolidated financial statementsAnnual Report 2015 Costs for services and other materials amounted to €16,457
This decrease was only partly offset by an increase in costs
million in 2015, a decrease on 2014 due largely to a contrac-
for wheeling and transport associated with the increase in
tion in costs for the purchase of environmental certificates
electricity consumption in the main markets in which the
and to a larger change in stocks of CO2 emissions allowan-
ces, environmental certificates and other materials, as re-
Group operates.
flected in the decrease of €1,197 million in costs for other
materials.
8.c Personnel - €5,313 million
Millions of euro
Wages and salaries
Social security contributions
Deferred compensation benefits
Other post-employment and long-term benefits
Early retirement incentives
Other costs
Total
2015
3,306
953
125
(831)
1,601
159
5,313
2014
3,329
931
111
70
313
110
4,864
Change
(23)
22
14
(901)
1,288
49
449
-0.7%
2.4%
12.6%
-
-
44.5%
9.2%
Personnel costs amounted to €5,313 million in 2015, an in-
in 2015. The increase compared with 2014 is mainly attri-
crease of €449 million.
butable to new agreements for early retirement reached in
The workforce contracted by 1,047, reflecting the balance
Italy in December 2015, in accordance with Article 4 of Law
between hirings and terminations (a decrease of 1,316), only
92/2012, and to the introduction of early retirement mechani-
partially offset by the increase associated with the change in
sms in Spain (“Acuerdo Voluntario de Salida”), which produ-
the scope of consolidation (an increase of 269 employees).
ced an increase of €90 million in costs compared with 2014.
For more details, please see the section concerning the pro-
The increase in “other post-employment and long-term be-
vision for early retirement incentives in note 35 below.
nefits” largely reflects the release (€902 million) of the provi-
sion for the electricity discount granted to retired employees
The table below shows the average number of employees
in Italy, following the unilateral termination of that benefit in
by category compared with the previous year, and the actual
the 4th Quarter of 2015.
number of employees at December 31, 2015.
“Early retirement incentives” amounted to €1,601 million
Senior managers
Middle managers
Office staff
Blue collar
Total
Average number (1)
Headcount (1)
2015
1,457
10,177
34,769
21,978
68,381
2014
1,552
14,263
38,224
16,709
70,748
Change
at Dec. 31, 2015 (2)
(95)
(4,086)
(3,455)
5,269
(2,367)
1,465
10,387
35,975
20,087
67,914
(1) For companies consolidated on a proportionate basis, the headcount corresponds to Enel percentage share of the total.
(2) Of which 4,301 in units classified as “held for sale”.
206
Annual Report 2015 8.d Depreciation, amortization and impairment losses -
€7,612 million
Millions of euro
Property, plant and equipment
Investment property
Intangible assets
Impairment losses
Reversal of impairment losses
Total
2015
4,190
8
689
2,978
(253)
7,612
2014
4,425
8
771
7,733
(267)
12,670
Change
-5.3%
-
-10.6%
-61.5%
5.2%
-39.9%
(235)
-
(82)
(4,755)
14
(5,058)
Depreciation and amortization decreased by €317 million in
reduction in assets subject to depreciation (also caused by
2015 (comprising property, plant and equipment and intan-
impairment losses posted in late 2014, which are discussed
gible assets), due to the variation in exchange rates and the
below).
Millions of euro
Impairment losses:
- property, plant and equipment
- investment property
- intangible assets
- goodwill
- trade receivables
- assets classified as held for sale
- other assets
Total impairment losses
Reversals of impairment losses:
- property, plant and equipment
- investment property
- intangible assets
- trade receivables
- assets classified as held for sale
- other assets
Total reversals of impairment losses
2015
1,246
5
68
13
1,058
574
14
2,978
(21)
-
-
(230)
-
(2)
(253)
2014
Change
2,886
(1,640)
18
744
194
997
2,878
16
7,733
(3)
-
-
(250)
-
(14)
(267)
(13)
(676)
(181)
61
(2,304)
(2)
(4,755)
(18)
-
-
20
-
12
14
-56.8%
-72.2%
-90.9%
-93.3%
6.1%
-80.1%
-12.5%
-61.5%
-
-
-
8.0%
-
85.7%
5.2%
“Impairment losses” decreased by €4,755 million on the
> a number of mineral exploration assets in Algeria (attribu-
previous year.
table to the upstream gas area) totaling €132 million, due
Impairment losses on property, plant and equipment in 2015
to the unfavorable fuel price situation.
mainly regarded:
In 2014 this item included (in addition to the factors noted
> power plants in Russia in the amount of €899 million
above for comparison purposes) impairment losses on ther-
(€205 million in 2014), in view of market forecasts for that
mal plants in Italy in the amount of €2,096 million (due to
country. The parameters used in the impairment test of
the continuing economic crisis in Italy and the consequent
the Enel Russia CGU are discussed in note 20 below;
negative impact on power generation from conventional re-
> the property, plant and equipment of Enel Green Power
sources), on leased assets in Slovakia – more specifically the
Romania for €139 million and of 3Sun for €42 million. The
Gabcˇíkovo hydroelectric plant – in the amount of €103 million
parameters used in the impairment test of the associated
(following the renegotiation which advanced the lease expiry
CGUs are discussed in note 20 below;
to 2015, instead of the original expiry of 2036), as well as
207
Consolidated financial statementsAnnual Report 2015 on the property, plant and equipment of Enel Green Power
amount of €35 million) and Spain (Distribuidora Eléctrica del
Hellas in the amount of €91 million.
Puerto de la Cruz in the amount of €31 million).
Impairment losses on intangible assets in 2015 amounted to
Impairment losses on goodwill were recognized following
€68 million. They mainly regard:
impairment testing. More details are provided in note 20.
> concessions and similar rights of Enel Longanesi in the
amount of €27 million to adjust the value of Upstream
Finally, impairment losses on assets classified as held for
Gas assets to their value in use;
sale amounted to €574 million in 2015 and to €2,878 million
> Enel Green Power North America in the amount of €26
in 2014. They regard the net assets of Slovenské elektrárne.
million.
The impairment loss was determined in both periods to align
In 2014, this item included impairment losses on the water
the carrying amount of the assets with their fair value less
rights held by Endesa Chile to use the water of a number of
costs to sell pending disposal, subsequently confirmed with
rivers in the Aysén region of that country in the amount of
the closing of an agreement with EPH in December 2015,
€589 million, concessions and similar rights of Enel Green
although the effects are suspending pending receipt of the
Power Hellas in the amount of €55 million, as well as a num-
necessary antitrust clearance.
ber of smaller concessions in Portugal (Hidromondego in the
8.e Other operating expenses - €2,654 million
Millions of euro
System charges - emissions allowances
System charges - energy efficiency certificates
System charges - green certificates
Losses on disposal of property, plant and equipment and
intangible assets
Taxes and duties
Other
Total
2015
340
315
181
49
1,272
497
2,654
2014
341
105
144
21
1,275
476
2,362
Change
(1)
210
37
28
(3)
21
292
-0.3%
-
25.7%
-
-0.2%
4.4%
12.4%
Other operating expenses amounted to €2,654 million, an
lations introduced in July 2015 by the Slovak government,
increase of €292 million, mainly due to:
who approved a new strategy for dealing with the “back
> an increase of €210 million in charges for white certifi-
end” of spent nuclear fuel; in 2014 another provision for
cates, largely reflecting higher volumes of purchased
the Slovakian plants had been released in the amount of
certificates for compliance purposes and a change in
€136 million;
regulations with Resolution 13/2014 of the Authority for
> the release of €63 million of provisions for risks and char-
Electricity, Gas and the Water System, which introduced
ges in 2014 following the settlement agreement between
a new cost reimbursement mechanism;
Enel Distribuzione, A2A and A2A Reti Elettriche;
> an increase of €37 million in costs for the purchase of
> an increase in provisions of €328 million to cover com-
green certificates;
pensation for the unilateral termination of the residential
> the release of the nuclear fuel disposal provision in Slova-
electricity discount for the Group’s retired employees in
kia in the amount of €550 million, based on a study con-
Italy as of December 31, 2015.
ducted by independent experts, following the new regu-
208
Annual Report 2015 8.f Capitalized costs - €(1,539) million
Millions of euro
Personnel
Materials
Other
Total
2015
(746)
(433)
(360)
2014
(719)
(391)
(414)
(1,539)
(1,524)
Change
(27)
(42)
54
(15)
-3.8%
-10.7%
13.0%
-1.0%
Capitalized costs consist of €746 million in personnel costs and €433 million in materials costs (compared with €719 million
and €391 million, respectively, in 2014).
9. Net income/(expense) from commodity contracts
measured at fair value - €168 million
Net income from commodity contracts measured at fair va-
2015 in the amount of €304 million (€268 million in 2014)
lue amounted to €168 million, the result of net unrealized
and net realized gains on positions closed during the year
expense on open positions in derivatives at December 31,
of €472 million (€43 million net in 2014).
Millions of euro
Income:
- unrealized on positions open at the end of the period
- realized on positions closed during the period
Total income
Expense:
- unrealized on positions open at the end of the period
- realized on positions closed during the period
Total expense
NET INCOME/(EXPENSE) FROM COMMODITY
CONTRACTS MEASURED AT FAIR VALUE
2015
2014
Change
2,832
6,702
9,534
(3,136)
(6,230)
(9,366)
4,455
3,793
8,248
(4,723)
(3,750)
(8,473)
(1,623)
2,909
1,286
1,587
(2,480)
(893)
-36.4%
76.7%
15.6%
33.6%
-66.1%
-10.5%
168
(225)
393
-
209
Consolidated financial statementsAnnual Report 2015 10. Net financial income/(expense) from derivatives - €950
million
Millions of euro
Income:
- income from cash flow hedge derivatives
- income from derivatives at fair value through profit or loss
- income from fair value hedge derivatives
Total income
Expense:
- expense on cash flow hedge derivatives
- expense on derivatives at fair value through profit or loss
- expense on fair value hedge derivatives
Total expense
TOTAL FINANCIAL INCOME/(EXPENSE) FROM
DERIVATIVES
2015
2014
Change
1,507
907
41
2,455
(330)
(1,145)
(30)
(1,505)
950
1,532
468
78
2,078
(434)
(476)
(6)
(916)
1,162
(25)
439
(37)
377
104
(669)
(24)
(589)
(212)
-1.6%
93.8%
-47.4%
18.1%
24.0%
-
-
-64.3%
-18.2%
Net income from cash flow hedge derivatives amounted to
For more details on derivatives, please see note 44 “Deriva-
€1,177 million, while derivatives at fair value through profit
tives and hedge accounting”.
or loss posted net expense of €238 million.
By contrast, the net performance of fair value hedge deriva-
tives produced net income of €11 million.
11. Net other financial income/(expense) - €(3,406) million
Other financial income
Millions of euro
Interest income from financial assets (current and non-
current):
- interest income at effective rate on non-current securities
and receivables
- interest income at effective rate on short-term financial
investments
Total interest income at the effective interest rate
Financial income on non-current securities at fair value
through profit or loss
Exchange gains
Income on equity investments
Other income
2015
2014
Change
85
180
265
5
882
11
400
43
217
260
6
529
4
449
42
(37)
5
(1)
353
7
(49)
315
97.7%
-17.1%
1.9%
-16.7%
66.7%
-
-10.9%
25.2%
TOTAL OTHER FINANCIAL INCOME
1,563
1,248
Other financial income amounted to €1,563 million, an in-
reduction reflects:
crease of €315 million compared with the previous year. The
> an increase in “exchange gains”, reflecting the impact of
210
Annual Report 2015 developments in exchange rates on net financial debt de-
> a slight increase in “income on equity investments”
nominated in currencies other than the euro, as well as
and “interest income at the effective rate”, respectively
the recognition, under the terms of the associated con-
amounting to €11 million and €265 million in 2015;
tract, by the Argentine authorities of the conversion of
> a decrease in “other income”, mainly due to effect of the
receivables for the construction of the Vuelta de Obligado
increase in the same item in 2014 following the settle-
plant into US dollars, given that it is essentially completed
ment agreement on Costanera’s payables to Mitsubishi.
(about €258 million);
Other financial expense
Millions of euro
Interest expense on financial debt
(current and non-current):
- interest expense on bank borrowings
- interest expense on bonds
- interest expense on other borrowings
Total interest expense
Expense on securities at fair value through profit or loss
Exchange losses
Accretion of post-employment and other employee
benefits
Accretion of other provisions
Charges on equity investments
Other charges
2015
2014
Change
371
2,314
143
2,828
-
1,738
101
210
3
89
360
2,476
116
2,952
-
1,814
139
258
3
374
11
(162)
27
(124)
-
(76)
(38)
(48)
-
(285)
(571)
3.1%
-6.5%
23.3%
-4.2%
-
-4.2%
-27.3%
-18.6%
-
-76.2%
-10.3%
TOTAL OTHER FINANCIAL EXPENSE
4,969
5,540
Other financial expense amounted to €4,969 million, a de-
note 34 for details), including other charges from accre-
crease of €571 million on 2014. The change reflects the fol-
tion of other provisions in the amount of €48 million,
lowing factors:
mainly ascribable to the accretion of the provision for
> a decrease in interest expense, largely owing to an avera-
early retirement incentives;
ge decrease in gross financial debt compared with 2014;
> a decrease of €285 million in “other charges” (€89 million
> a decrease of €76 million in “exchange losses”, attributa-
in 2015 and €374 million in 2014), essentially reflecting the
ble to the fluctuation of the euro against the other curren-
effect of the downward adjustment in 2014 of financial as-
cies in which bonds are issued. This factor was essentially
sets (€92 million) associated with service concession ar-
offset by an increase in income on cash flow hedge deri-
rangements in Brazil and the impairment loss recognized
vatives on exchange rates;
in 2014 on the financial receivables from Elcogas, as well
> a decrease of €38 million in charges from “accretion of
as an increase of about €63 million in capitalized interest,
post-employment and other employee benefits” (see
partly due to the rise in investment.
211
Consolidated financial statementsAnnual Report 2015 12. Share of income/(losses) of equity investments
accounted for using the equity method - €52 million
Millions of euro
Share of income of associates
Share of losses of associates
Impairment losses
Total
2015
152
(100)
-
52
2014
229
(87)
(177)
(35)
Change
(77)
(13)
177
87
-33.6%
-14.9%
-
-
The share of income and losses of equity investments ac-
Chile) and on Enel Green Power Hellas CGU with regard
counted for using the equity method increased by €87 mil-
to the “Elica 2” equity-accounted investments as a result
lion compared with the previous year. The rise is attributable
of the persistent adverse economic climate. These factors
to impairment losses posted in 2014 in the amount of €177
were only partly offset by a decline in income from associa-
million on the joint venture in Centrales Hidroeléctricas de
tes posted in 2015 (€77 million), which was mostly due to
Aysén (as a result of uncertainty about permitting for the
the effect of changes in the scope of consolidation during
development of the project to build a hydroelectric plant in
the periods under consideration.
13. Income taxes - €1,909 million
Millions of euro
Current taxes
Adjustments for income taxes related to prior years
Total current taxes
Deferred tax liabilities
Deferred tax assets
TOTAL
2015
2,061
(19)
2,042
(125)
(8)
1,909
2014
1,968
(119)
1,849
(961)
(1,738)
(850)
Change
93
100
193
836
1,730
2,759
4.7%
84.0%
10.4%
87.0%
-
-
Income taxes for 2015 amounted to €1,909 million, compa-
> a reduction in taxes in the period on non-recurring tran-
red with a credit position of €850 million in 2014.
sactions subject to non-standard tax rates, in particular
Income taxes therefore increased by €2,759 million compa-
the effect of remeasurements at fair value and the nega-
red with the previous year, as a result of the sharp increase
tive goodwill on 3Sun and the gains from the sale of SE
in income before taxes and of the following non-recurring
Hydropower;
factors:
> a reduction of €50 million in IRAP due to changes in the
> adjustment of net deferred tax assets in Italy totaling
deductibility of personnel costs for IRAP purposes;
€197 million, as a result of the Stability Act passed in De-
> the effect of the change in tax rates on deferred taxation,
cember 2015, reducing the IRES rate from 27.5% to 24%
mainly in Chile, Colombia, Peru and Spain, recognized in
as from January 1, 2017;
2014, which had produced a net benefit of €146 million:
> the recognition of deferred tax assets in 2014 in the
in 2015, the changes in tax rates in the above countries
amount of €1,392 million in respect of Enel Iberoamérica
began to impact current income taxes.
(formerly Enel Energy Europe) following the distribution
of dividends associated with a number of non-recurring
Note that in 2014 an increase of €366 million in taxes was
corporate transactions;
recognized as a result of an adjustment of deferred taxation
212
Annual Report 2015 in Italy following a court ruling that the IRES surtax (the so-
the effective tax rate. Please note that the estimated taxes
called Robin Hood Tax) was unconstitutional after a lengthy
of Group companies outside of Italy in 2015 – including the
administrative proceeding.
effect of deferred taxation – were a negative €751 million
The following table reconciles the theoretical tax rate with
(compared with €1,885 million in 2014).
Millions of euro
Income before taxes
Theoretical taxes
Change in tax effect on impairment losses, capital gains and negative
goodwill
Tax credit from distribution of Endesa dividends
Impact on deferred taxation of changes in tax rates
IRES surtax (Decree Law 112/2008)
IRAP
Other differences, effect of different foreign tax rates, and minor items
Total
27.5%
27.5%
2015
5,281
1,452
(51)
-
197
-
250
61
1,909
2014
(78)
(21)
245
(1,392)
(146)
188
320
(44)
(850)
14. Basic and diluted earnings per share
Both metrics are calculated on the basis of the average num-
shares, adjusted for the diluting effect of outstanding stock
ber of ordinary shares in the period, equal to 9,403,357,795
options (none in both periods).
Net income from continuing operations attributable to
shareholders of the Parent Company (millions of euro)
Net income from discontinued operations attributable to
shareholders of the Parent Company (millions of euro)
Net income attributable to shareholders of the Parent
Company (millions of euro)
Number of ordinary shares
Dilutive effect of stock options
Basic and diluted earnings per share (euro)
Basic and diluted earnings from continuing operations per
share (euro)
Basic and diluted earnings from discontinued operations per
share (euro)
2015
2,196
-
2,196
2014
517
-
517
9,403,357,795
9,403,357,795
-
0.23
0.23
-
-
0.05
0.05
-
Change
1,679
-
1,679
-
-
0.18
0.18
-
-
-
-
-
-
-
-
-
213
Consolidated financial statementsAnnual Report 2015 15. Property, plant and equipment - €73,307 million
The breakdown of and changes in property, plant and equipment for 2015 are shown below.
Buildings
Plant and machinery
Industrial and commercial
equipment
Other assets
Leased assets
Leasehold improvements
Assets
under construction
and advances
8,711
4,902
3,809
59
377
6
56
(16)
(135)
(303)
1
(25)
20
8,788
4,959
3,829
144,890
83,970
60,920
1,014
4,463
(723)
(171)
(87)
(3,789)
(712)
20
169
184
147,014
85,910
61,104
386
312
74
21
5
-
8
(1)
(18)
(8)
-
(4)
3
400
323
77
1,332
1,042
290
46
37
(13)
-
(1)
(76)
(2)
-
(27)
(36)
1,289
1,035
254
1,091
226
865
11
(4)
(15)
(48)
-
-
-
-
(37)
(93)
1,030
258
772
332
201
131
10
29
-
(5)
(1)
(26)
-
-
2
9
364
224
140
6,442
6,442
5,125
(4,955)
-
-
-
-
(391)
249
(6)
(221)
225
26
6,468
6,468
Total
163,742
90,653
73,089
6,353
-
(1,145)
124
(113)
(4,092)
(1,246)
21
316
218
166,016
92,709
73,307
Millions of euro
Cost
Accumulated depreciation
Balance at Dec. 31, 2014
Capital expenditure
Assets entering service
Exchange rate differences
Change in scope of consolidation
Disposals
Depreciation
Impairment losses
Reversal of impairment losses
Other changes
Total changes
Cost
Accumulated depreciation
Balance at Dec. 31, 2015
Land
558
-
558
67
44
(20)
2
(1)
-
-
-
13
105
663
-
663
214
Annual Report 2015 15. Property, plant and equipment - €73,307 million
The breakdown of and changes in property, plant and equipment for 2015 are shown below.
Millions of euro
Cost
Accumulated depreciation
Balance at Dec. 31, 2014
Capital expenditure
Assets entering service
Exchange rate differences
Change in scope of consolidation
Disposals
Depreciation
Impairment losses
Other changes
Total changes
Cost
Reversal of impairment losses
Accumulated depreciation
Balance at Dec. 31, 2015
Land
558
-
558
67
44
(20)
2
(1)
-
-
-
-
13
105
663
663
8,711
4,902
3,809
59
377
6
56
(16)
(135)
(303)
1
(25)
20
8,788
4,959
3,829
144,890
83,970
60,920
1,014
4,463
(723)
(171)
(87)
(3,789)
(712)
20
169
184
147,014
85,910
61,104
386
312
74
21
5
-
8
(1)
(18)
(8)
-
(4)
3
400
323
77
Buildings
Plant and machinery
equipment
Other assets
Leased assets
Leasehold improvements
Industrial and commercial
Assets
under construction
and advances
1,332
1,042
290
46
37
(13)
-
(1)
(76)
(2)
-
(27)
(36)
1,289
1,035
254
1,091
226
865
11
-
(4)
(15)
-
(48)
-
-
(37)
(93)
1,030
258
772
332
201
131
10
29
-
(5)
(1)
(26)
-
-
2
9
364
224
140
6,442
-
6,442
5,125
(4,955)
(391)
249
(6)
-
(221)
-
225
26
6,468
-
6,468
Total
163,742
90,653
73,089
6,353
-
(1,145)
124
(113)
(4,092)
(1,246)
21
316
218
166,016
92,709
73,307
215
Consolidated financial statementsAnnual Report 2015 “Plant and machinery” includes assets to be relinquished free
For more information on “leased assets”, please see note 17
of charge with a net carrying amount of €8,516 million (€8,269
below.
million at December 31, 2014), largely regarding power plants
in the Iberian Peninsula and Latin America amounting to
The table below summarizes capital expenditure in 2015 by
€5,155 million (€4,820 million at December 31, 2014) and
category. These expenditures, totaling € 6,353 million, increa-
the electricity distribution network in Latin America totaling
sed by €334 million on 2014.
€2,998 million (€3,027 million at December 31, 2014).
Millions of euro
Power plants:
- thermal
- hydroelectric
- geothermal
- nuclear
- alternative energy resources
Total power plants
Electricity distribution networks
Land, buildings and other assets and equipment
TOTAL
2015
757
807
197
128
1,900
3,789
2,466
98
6,353
2014
884
656
169
787
1,256
3,752
2,115
152
6,019
Capital expenditure on power plants amounted to €3,789
At December 31, 2015, testing was conducted of the reco-
million, an increase of €37 million on the previous year, es-
verability of the value of the assets of a number of CGUs
sentially reflecting increased investment in renewable ge-
(Enel Russia, Enel Green Power Hellas and Enel Produzio-
neration plants (mainly wind plants totaling €1,233 million
ne) that showed evidence of impairment, following which
and photovoltaic plants amounting to €628 million) and in
it was determined that the values were essentially reco-
hydroelectric facilities by the Renewable Energy Division.
verable.
Capital expenditure for the electricity distribution network
In order to verify the robustness of the value in use identi-
amounted to €2,446 million, up €351 million compared
fied for those CGUs, sensitivity analyses were conducted
with the previous year. The increase is essentially attribu-
for the main value drivers, and in particular WACC, the long-
table to greater investment in the medium and low-voltage
term growth rate and EBITDA, assuming individual changes
grids in Italy and Latin America.
in each assumption of up to 5% of the value used in the
tests.
The “change in scope of consolidation” for the period
For the Enel Produzione CGU, the analysis found that in the
mainly concerned the acquisitions of control of 3Sun, in the
case of changes in EBITDA or WACC within the range no-
1st Quarter of 2015, the acquisition of 68% of BLP Energy,
ted above and holding the other assumptions unchanged,
an Indian company operating in the renewables generation
the value in use would not exceed the carrying amount.
sector, and the full consolidation of Osage Wind, which had
Accordingly, in view of this evidence and confirming the
previously been accounted for using the equity method.
impairment indicators already identified last year, no write-
These effects were partly offset by the disposal of the Por-
back of its value was performed.
tuguese companies and the deconsolidation of the Italian
solar assets of the Renewable Energy Division.
“Impairment losses” on property, plant and equipment
amounted to €1,246 million. For a more detailed analysis,
please see note 8.d.
216
Annual Report 2015 “Other changes” include, among other items, the effect
expenditure in the amount of €208 million (€196 million in
of the capitalization of interest on specific loans for capital
2014), as detailed in the following table.
Millions of euro
Renewable Energy
Latin America
Eastern Europe (1)
Iberian Peninsula
Italy
Total
2015
80
104
-
7
17
208
% rate
5.2%
23.7%
-
2.7%
4.2%
2014
59
75
41
6
15
196
% rate
4.8%
14.8%
2.6%
3.0%
5.0%
Change
21
29
(41)
1
2
12
35.6%
38.7%
-
16.7%
13.3%
6.1%
(1) The figure does not include €51 million regarding units classified as “held for sale”.
At December 31, 2015, contractual commitments to purchase property, plant and equipment amounted to €424 million.
16. Infrastructure within the scope of “IFRIC 12 - Service
concession arrangements”
Service concession arrangements, which are recognized in
The following table summarizes the salient details of those
accordance with IFRIC 12, regard certain infrastructure ser-
concessions.
ving concessions for electricity distribution in Brazil.
Millions of euro
Grantor
Activity
Country
Concession
period
Concession
period
remaining
Renewal
option
Amount
recognized
among
financial
assets at
Dec. 31, 2015
Amount
recognized
among
intangible
assets at
Dec. 31, 2015
Ampla Energia e
Serviços
Brazilian
government
Companhia Energética
do Ceará
Brazilian
government
Electricity
distribution
Electricity
distribution
Brazil
1997-2026
11 years
Brazil
1998-2028
12 years
Total
Yes
Yes
425
206
631
810
692
1,502
The value of the assets at the end of the concessions clas-
lue. For more details, please see note 45 “Assets measu-
sified under financial assets has been measured at fair va-
red at fair value”.
217
Consolidated financial statementsAnnual Report 2015 17. Leases
The Group, in the role of lessee, has entered into finance lea-
and a discount rate of between 4.95% and 5.5%.
se agreements. They include certain assets which the Group
In Latin America, the assets relate to leased power transmis-
is using in Spain, France, Greece, Italy and Latin America.
sion lines and plant (Ralco-Charrúa), with a residual term of
More specifically, in Spain the assets relate to a 25-year “tol-
eight years on the lease at a 6.5% rate, a lease of a combined-
ling” contract for which an analysis pursuant to IFRIC 4 iden-
cycle plant (Talara) with a term of nine years at a fixed rate of
tified an embedded finance lease, under which Endesa has
5.8%, as well as a number of combined-cycle plants in Peru
access to the generation capacity of a combined cycle plant
(residual lease term of one year bearing a floating rate).
for which the toller, Elecgas, has undertaken to transform gas
into electricity in exchange for a toll at a rate of 9.62%. The
The carrying amount of assets held under finance leases is
other lease agreements regard wind plants that the Group
reported in the following table.
uses in Italy (with a term of 18 years expiring in 2030-2031)
Millions of euro
Property, plant and equipment
Intangible assets
Total
2015
772
-
772
2014
865
-
865
Change
(93)
-
(93)
-10.8%
-
-10.8%
The following table reconciles total future minimum lease payments and the present value, broken down by maturity.
Millions of euro
Periods:
- 2016
- 2017-2020
- Beyond 2020
Total
Finance charges
Present value of minimum lease payments
Future minimum
payments
Present value of
future minimum
payments
Future minimum
payments
Present value of
future minimum
payments
at Dec. 31, 2015
at Dec. 31, 2014
97
322
696
1,115
(360)
755
58
199
498
755
102
398
750
1,250
(412)
838
62
250
526
838
The Group, in the role of lessee, has entered also into ope-
Costs for operating leases are broken down in the following
rating lease agreements regarding the use of certain assets
table into minimum payments, contingent rents and suble-
for industrial purposes. The associated lease payments are
ase payments.
expensed under “Services and other materials”.
Millions of euro
Minimum lease payments
Contingent rents
Sublease payments
Total
218
2015
2,002
-
3
2,005
Annual Report 2015 The future minimum lease payments due by the Group under such leases break down by maturity as follows.
Millions of euro
Periods:
- within 1 year
- beyond 1 year and within 5 years
- beyond 5 years
Total
18. Investment property - €144 million
Investment property at December 31, 2015 amounted to €144 million, essentially unchanged on the previous year.
Millions of euro
Cost
Accumulated depreciation and impairment
Balance at Dec. 31, 2014
Entry into service
Depreciation
Impairment losses
Other changes
Total change
Cost
Accumulated depreciation and impairment
Balance at Dec. 31, 2015
2015
216
841
945
2,002
2015
173
30
143
-
(8)
(5)
14
1
187
43
144
The Group’s investment property consists of properties in
investment property or for repairs, maintenance or enhan-
Italy, Spain and Chile, which are free of restrictions on the
cements.
realizability of the investment property or the remittance of
For more details on the valuation of investment property,
income and proceeds of disposal. In addition, the Group has
please see notes 45 “Assets measured at fair value” and
no contractual obligations to purchase, construct or develop
45.1 “Fair value of other assets”.
219
Consolidated financial statementsAnnual Report 2015 19. Intangible assets - €15,235 million
A breakdown of and changes in intangible assets for 2015 are shown below.
Millions of euro
Cost
Accumulated amortization
and impairment
Balance at Dec. 31, 2014
Capital expenditure
Assets entering service
Exchange rate differences
Change in scope of
consolidation
Disposals
Amortization
Impairment losses
Other changes
Total changes
Cost
Accumulated amortization
and impairment
Balance at Dec. 31, 2015
Development
costs
Industrial patents
and intellectual
property rights
Concessions,
licenses,
trademarks
and similar rights
Service
concession
arrangements
26
17
9
8
1
(2)
-
(1)
(2)
-
(3)
1
28
18
10
2,735
14,515
3,774
2,231
504
118
239
(5)
-
-
(275)
(1)
1
77
2,999
2,418
581
1,392
13,123
7
3
(820)
(14)
-
(162)
(20)
25
(981)
13,394
1,252
12,142
1,836
1,938
318
-
(500)
-
(9)
(158)
-
(87)
(436)
2,972
1,470
1,502
Assets
under
development
and advances
Total
622
23,328
-
6,716
622
291
(265)
16,612
760
-
4
(1,309)
17
(17)
114
(27)
-
(692)
(39)
(39)
(68)
(155)
(48)
(1,377)
574
21,609
-
6,374
574
15,235
Other
1,656
1,240
416
18
22
14
111
-
(95)
(8)
(52)
10
1,642
1,216
426
“Industrial patents and intellectual property rights” relate
clude costs incurred by the gas companies and the foreign
mainly to costs incurred in purchasing software and open-
electricity distribution companies to acquire customers.
ended software licenses. The most important applications
Amortization is calculated on a straight-line basis over the
relate to invoicing and customer management, the deve-
average duration of the relationships with the customers ac-
lopment of Internet portals and the management of com-
quired or the concessions.
pany systems. Amortization is calculated on a straight-line
basis over the asset’s residual useful life (on average betwe-
The following table reports service concession arrange-
en three and five years).
ments that do not fall within the scope of IFRIC 12.
“Concessions, licenses, trademarks and similar rights” in-
Millions of euro
Grantor
Activity
Country
Concession
period
Period
remaining
Renewal
option
at Dec. 31,
2015
Initial fair
value
Endesa Distribución
Eléctrica
Electricity
distribution
-
Codensa
Republic of
Colombia
Electricity
distribution
Chilectra
Republic of Chile
Empresa de
Distribución Eléctrica
de Lima Norte
Enel Distributie
Muntenia
Republic of Peru
Romanian
Ministry for the
Economy
Electricity
distribution
Electricity
distribution
Electricity
distribution
Spain
Indefinite
Indefinite
5,679
5,673
Colombia
Indefinite
Indefinite
1,568
1,839
Chile
Indefinite
Indefinite
1,566
1,667
Peru
Indefinite
Indefinite
641
548
Romania
2005-2054
38 years
Yes
155
191
220
Annual Report 2015 The item includes assets with an indefinite useful life in the
The “change in scope of consolidation” for the period mainly
amount of €9,454 million (€9,848 million at December 31,
regards acquisitions and disposals of the Renewable Energy
2014), essentially accounted for by concessions for distribu-
Division, as well as the acquisition of residential customers
tion activities in Spain (€5,679 million), Colombia (€1,568 mil-
connected with the supply of gas in Spain.
lion), Chile (€1,566 million) and Peru (€641 million), for which
there is no statutory or currently predictable expiration date.
“Impairment losses” amounted to €68 million in 2015; for
On the basis of the forecasts developed, cash flows for each
more details, please see note 8.d.
CGU, with which the various concessions are associated,
are sufficient to recover the carrying amount. The change du-
At December 31, 2015, contractual commitments for the ac-
ring the year is essentially attributable to changes in exchan-
quisition of intangible assets amounted to €16 million.
ge rates. For more information on “Service concession ar-
rangements”, please see note 24.
221
Consolidated financial statementsAnnual Report 2015 20. Goodwill - €13,824 million
“Goodwill” amounted to €13,824 million, a decrease of €203 million for the year.
Millions of euro
at Dec. 31, 2014
Change in the scope of
consolidation
Exchange differences
Impairment losses
at Dec. 31, 2015
Cost Accumulated impairment
Net carrying amount
Cost Accumulated impairment
Net carrying amount
Endesa
Latin America
Enel Green Power Group (1)
Enel Energia
Enel Distributie Muntenia
Enel Energie Muntenia
Nuove Energie
Total
10,999
3,285
990
579
546
113
26
(2,392)
-
(119)
-
-
-
-
8,607
3,285
871
579
546
113
26
-
-
(241)
-
-
-
-
16,538
(2,511)
14,027
(241)
(13)
16,348
(2,524)
13,824
49
-
-
-
-
-
2
51
(13)
-
-
-
-
-
-
10,999
3,285
798
579
548
113
26
(2,392)
(132)
-
-
-
-
-
8,607
3,285
666
579
548
113
26
(1) Enel Green Power España, Enel Green Power Latin America, Enel Green Power North America, Enel Green Power Hellas, Enel Green Power Romania, Enel
Green Power Bulgaria and Enel Green Power Italia.
The “change in scope of consolidation” mainly regards the
Cash flows were determined on the basis of the best in-
disposal of the Portuguese companies of the Renewable
formation available at the time of the estimate and drawn:
Energy Division, only partly offset by a number of minor
> for the explicit period, from the 5-year business plan ap-
acquisitions the Division made in Mexico.
proved by the Board of Directors of the Parent Company
containing forecasts for volumes, revenues, operating
The criteria used to identify the cash generating units
costs, capital expenditure, industrial and commercial or-
(CGUs) were essentially based (in line with management’s
ganization and developments in the main macroeconomic
strategic and operational vision) on the specific characteri-
variables (inflation, nominal interest rates and exchange
stics of their business, on the operational rules and regu-
rates) and commodity prices. The explicit period of cash
lations of the markets in which Enel operates and on the
flows considered in impairment testing differs in accor-
corporate organization, as well as on the level of reporting
dance with the specific features and business cycles of
monitored by management.
the various CGUs being tested. These differences are ge-
The recoverable value of the goodwill recognized was esti-
nerally associated with the different average times nee-
mated by calculating the value in use of the CGUs using
ded to build and bring into service the plant and other
discounted cash flow models, which involve estimating
works that characterize the investments of the specific
expected future cash flows and applying an appropriate di-
businesses that make up the CGU (conventional thermal
scount rate, selected on the basis of market inputs such as
generation, nuclear power, renewables, distribution, etc.);
risk-free rates, betas and market risk premiums.
> for subsequent years, from assumptions concerning long-
222
Annual Report 2015 20. Goodwill - €13,824 million
“Goodwill” amounted to €13,824 million, a decrease of €203 million for the year.
Endesa
Latin America
Enel Green Power Group (1)
Enel Energia
Enel Distributie Muntenia
Enel Energie Muntenia
Nuove Energie
Total
10,999
3,285
990
579
546
113
26
(2,392)
(119)
-
-
-
-
-
(1) Enel Green Power España, Enel Green Power Latin America, Enel Green Power North America, Enel Green Power Hellas, Enel Green Power Romania, Enel
Green Power Bulgaria and Enel Green Power Italia.
16,538
(2,511)
14,027
(241)
Change in the scope of
consolidation
8,607
3,285
871
579
546
113
26
(241)
-
-
-
-
-
-
Millions of euro
at Dec. 31, 2014
Exchange differences
Impairment losses
at Dec. 31, 2015
Cost Accumulated impairment
Net carrying amount
Cost Accumulated impairment
Net carrying amount
-
-
49
-
2
-
-
51
-
-
(13)
-
-
-
-
10,999
3,285
798
579
548
113
26
(2,392)
-
(132)
-
-
-
-
8,607
3,285
666
579
548
113
26
(13)
16,348
(2,524)
13,824
term developments in the main variables that determine
scribed above was found to be greater than the amount
cash flows, the average residual useful life of assets or
recognized on the balance sheet, with the exceptions di-
the duration of the concessions.
scussed below.
More specifically, the terminal value was calculated as a
In order to verify the robustness of the value in use of the
perpetuity or annuity with a nominal growth rate equal to
CGUs, sensitivity analyses were conducted for the main dri-
the long-term rate of growth in electricity and/or inflation
vers of the values, in particular WACC, the long-term growth
(depending on the country and business involved) and in
rate and margins, the outcomes of which fully supported
any case no higher than the average long-term growth rate
that value.
of the reference market. The value in use calculated as de-
223
Consolidated financial statementsAnnual Report 2015 The table below reports the composition of the main go-
horizon over which the expected cash flows have been di-
odwill values according to the company to which the CGU
scounted.
belongs, along with the discount rates applied and the time
Millions of euro
Amount
Growth rate (1)
Discount rate pre-tax
WACC (2)
Explicit period of
cash flows
Terminal value (3)
Amount
Growth rate (1) Discount rate pre-tax WACC (2)
flows
Terminal value (3)
Explicit period of cash
at Dec. 31, 2015
at Dec. 31, 2014
8,607
3,285
-
659
579
404
308
117
-
26
24
13
5
1.92%
2.67%
0.97%
2.07%
0.13%
2.00%
3.45%
2.17%
-
0.29%
2.00%
2.07%
2.50%
7.92%
8.48%
14.99%
7.90%
11.98%
7.90%
8.53%
7.46%
18.69%
8.98%
8.15%
8.26%
8.27%
5 years
5 years
5 years
5 years
5 years
5 years
5 years
5 years
5 years
10 years
5 years
5 years
5 years
Perpetuity
Perpetuity
Perpetuity
Perpetuity
15 years
13 years
22 years
20 years
21 years
16 years
17 years
15 years
Perpetuity/14 years
Endesa - Iberian Peninsula (4)
Endesa - Latin America
Enel Russia
Enel Romania (5)
Enel Energia
Enel Green Power España
Enel Green Power Latin America
Enel Green Power North America
Enel Green Power Hellas
Nuove Energie
Enel Green Power Italia
Enel Green Power Romania
Enel Green Power Bulgaria
8,607
3,285
-
660
579
157
350
131
-
26
23
-
5
1.77%
3.12%
4.00%
2.30%
0.16%
2.00%
3.34%
2.20%
-
0.20%
2.00%
2.30%
2.20%
7.90%
8.42%
15.31%
7.65%
11.92%
7.63%
8.16%
9.27%
-
9.94%
8.50%
8.08%
8.09%
5 years
5 years
5 years
5 years
5 years
5 years
5 years
5 years
-
Perpetuity
Perpetuity
Perpetuity
Perpetuity
15 years
12 years
21 years
19 years
-
9 years
16 years
5 years Perpetuity/17 years (6)
5 years
5 years
16 years
14 years
(1) Perpetual growth rate of cash flows after explicit period.
(2) Pre-tax WACC calculated using the iterative method: the discount rate that ensures that the value in use calculated with pre-tax cash flows is equal to that
calculated with post-tax cash flows discounted with the post-tax WACC.
(3) The terminal value has been estimated on the basis of a perpetuity or an annuity with a rising yield for the years indicated in the column.
(4) Goodwill includes the portion of goodwill in respect of Enel Green Power España pertaining to it.
(5) Includes all companies operating in Romania.
(6) The terminal value for Enel Green Power Italia was estimated on the basis of a perpetuity for the hydroelectric and geothermal plants and an expected
annuity with a rising yield for a period of 17 years for other renewables technologies (wind, solar, biomass).
At December 31, 2015, impairment testing of the CGUs to
At December 31, 2014 an impairment loss of €365 million
which goodwill had been allocated found an impairment loss
had been recognized on the Enel Russia CGU (formerly Enel
of €155 million on the Enel Green Power Romania CGU, of
OGK-5) and €269 million on the Enel Green Power Hellas
which €13 million attributed to goodwill, while the remain-
CGU.
der was allocated among the generation assets. The loss is
attributable to market forecasts and the regulatory situation
in the country.
224
Annual Report 2015 Millions of euro
Amount
Growth rate (1)
WACC (2)
cash flows
Terminal value (3)
Amount
Growth rate (1) Discount rate pre-tax WACC (2)
Discount rate pre-tax
Explicit period of
Explicit period of cash
flows
Terminal value (3)
at Dec. 31, 2015
at Dec. 31, 2014
Endesa - Iberian Peninsula (4)
Endesa - Latin America
Enel Russia
Enel Romania (5)
Enel Energia
Enel Green Power España
Enel Green Power Latin America
Enel Green Power North America
Enel Green Power Hellas
Nuove Energie
Enel Green Power Italia
Enel Green Power Romania
Enel Green Power Bulgaria
8,607
3,285
-
660
579
157
350
131
-
26
23
-
5
1.77%
3.12%
4.00%
2.30%
0.16%
2.00%
3.34%
2.20%
-
0.20%
2.00%
2.30%
2.20%
7.90%
8.42%
15.31%
7.65%
11.92%
7.63%
8.16%
9.27%
-
9.94%
8.50%
8.08%
8.09%
5 years
5 years
5 years
5 years
5 years
5 years
5 years
5 years
-
5 years
5 years
Perpetuity
Perpetuity
Perpetuity
Perpetuity
15 years
12 years
21 years
19 years
-
16 years
14 years
9 years
16 years
5 years Perpetuity/17 years (6)
(1) Perpetual growth rate of cash flows after explicit period.
(2) Pre-tax WACC calculated using the iterative method: the discount rate that ensures that the value in use calculated with pre-tax cash flows is equal to that
calculated with post-tax cash flows discounted with the post-tax WACC.
(3) The terminal value has been estimated on the basis of a perpetuity or an annuity with a rising yield for the years indicated in the column.
(4) Goodwill includes the portion of goodwill in respect of Enel Green Power España pertaining to it.
(5) Includes all companies operating in Romania.
(6) The terminal value for Enel Green Power Italia was estimated on the basis of a perpetuity for the hydroelectric and geothermal plants and an expected
annuity with a rising yield for a period of 17 years for other renewables technologies (wind, solar, biomass).
8,607
3,285
-
659
579
404
308
117
-
26
24
13
5
1.92%
2.67%
0.97%
2.07%
0.13%
2.00%
3.45%
2.17%
-
0.29%
2.00%
2.07%
2.50%
7.92%
8.48%
14.99%
7.90%
11.98%
7.90%
8.53%
7.46%
18.69%
8.98%
8.15%
8.26%
8.27%
5 years
5 years
5 years
5 years
5 years
5 years
5 years
5 years
5 years
10 years
5 years
5 years
5 years
Perpetuity
Perpetuity
Perpetuity
Perpetuity
15 years
13 years
22 years
20 years
21 years
16 years
Perpetuity/14 years
17 years
15 years
225
Consolidated financial statementsAnnual Report 2015 21. Deferred tax assets and liabilities - €7,386 million and
€8,977 million
The following table details changes in deferred tax assets and
also reports the amount of deferred tax assets that, where
liabilities by type of timing difference and calculated based on
allowed, can be offset against deferred tax liabilities.
the tax rates established by applicable regulations. The table
Millions of euro
Deferred tax assets:
- differences in the value of intangible assets, and
property, plant and equipment
- accruals to provisions for risks and charges and
impairment losses with deferred deductibility
- tax loss carried forward
- measurement of financial instruments
- employee benefits
- other items
Total
Deferred tax liabilities:
- differences on non-current and financial assets
- measurement of financial instruments
- other items
Total
Non-offsettable deferred tax assets
Non-offsettable deferred tax liabilities
Excess net deferred tax liabilities after any
offsetting
Increase/(Decrease) taken to
income statement
Increase/(Decrease) taken
to equity
Change in scope of
consolidation
Other changes Exchange rate differences
“Assets held for sale”
Reclassification from/to
at Dec. 31, 2014
at Dec. 31, 2015
2,239
1,166
105
659
995
1,903
7,067
6,765
453
2,002
9,220
(357)
341
(36)
5
(210)
253
(4)
(208)
(26)
88
(146)
2
-
-
195
(166)
7
38
8
16
(1)
23
-
-
-
1
-
-
-
(1)
(28)
11
(17)
140
(11)
71
(35)
17
187
369
408
(8)
(102)
298
(26)
(40)
5
(1)
(16)
(6)
(84)
(339)
(2)
(31)
(372)
-
-
-
-
-
-
-
-
-
(29)
(29)
1,998
1,456
145
824
620
2,343
7,386
6,606
433
1,938
8,977
2,149
3,310
430
At December 31, 2015, “deferred tax assets” totaled €7,386
“Deferred tax liabilities” amounted to €8,977 million at De-
million (€7,067 million at December 31, 2014).
cember 31, 2015 (€9,220 million at December 31, 2014).
The increase during the year amounted to €319 million,
They essentially include the determination of the tax effects
mainly reflecting the tax effect of income components not
of the value adjustments to assets acquired as part of the
recognized for tax purposes, only partly offset by the reduc-
final allocation of the cost of acquisitions made in the various
tion associated with the expected decrease in the IRES rate
years and the deferred taxation in respect of the differences
in Italy from 27.5% to 24% as from 2017.
between depreciation charged for tax purposes, including
It should also be noted that no deferred tax assets were re-
accelerated depreciation, and depreciation based on the
corded in relation to prior tax losses in the amount of €1,051
estimated useful lives of assets.
million because, on the basis of current estimates of future
taxable income, it is not certain that such assets will be re-
covered.
226
Annual Report 2015 Millions of euro
Deferred tax assets:
- differences in the value of intangible assets, and
property, plant and equipment
- accruals to provisions for risks and charges and
impairment losses with deferred deductibility
- tax loss carried forward
- measurement of financial instruments
- employee benefits
- other items
Total
Deferred tax liabilities:
- differences on non-current and financial assets
- measurement of financial instruments
- other items
Total
Non-offsettable deferred tax assets
Non-offsettable deferred tax liabilities
Excess net deferred tax liabilities after any
offsetting
Increase/(Decrease) taken to
Increase/(Decrease) taken
income statement
to equity
Change in scope of
consolidation
Other changes Exchange rate differences
Reclassification from/to
“Assets held for sale”
at Dec. 31, 2014
at Dec. 31, 2015
2,239
1,166
105
659
995
1,903
7,067
6,765
453
2,002
9,220
(357)
341
(36)
5
(210)
253
(4)
(208)
(26)
88
(146)
195
(166)
2
-
-
7
38
8
16
(1)
23
-
-
-
1
-
(1)
-
(28)
-
11
(17)
140
(11)
71
(35)
17
187
369
408
(8)
(102)
298
(26)
(40)
5
(1)
(16)
(6)
(84)
(339)
(2)
(31)
(372)
-
-
-
-
-
-
-
-
-
(29)
(29)
1,998
1,456
145
824
620
2,343
7,386
6,606
433
1,938
8,977
2,149
3,310
430
227
Consolidated financial statementsAnnual Report 2015 22. Equity investments accounted for using the equity method
- €607 million
Investments in joint arrangements and associated companies accounted for using the equity method are as follows.
Millions of euro
Joint arrangements
Hydro Dolomiti Enel
Tejo Energia Produção e Distribuição de
Energia Eléctrica
Empresa de Energía Cundinamarca
RusEnergoSbyt
Energie Electrique de Tahaddart
Electrogas
Transmisora Eléctrica de Quillota
Centrales Hidroeléctricas de Aysén
PowerCrop
Nuclenor
Associates
Ultor
Elica 2
CESI
Altomonte FV
Tecnatom
GNL Quinteros
Suministradora Eléctrica de Cádiz
Terrae
Compañía Eólica Tierras Altas
ENEOP - Eólicas de Portugal
Eevm - Empreendimentos Eólicos do Vale
do Minho
Other
Total
% holding
Income effect
Change in scope of
consolidation
Reclassification from/to
Dividends
“Assets held for sale”
Other changes
% holding
at Dec. 31, 2014
at Dec. 31, 2015
49.0%
38.9%
40.4%
49.5%
42.5%
50.0%
50.0%
51.0%
50.0%
50.0%
-
30.0%
42.7%
-
45.0%
20.0%
33.5%
20.0%
35.6%
36.0%
50.0%
218
61
34
29
29
15
9
8
5
-
-
50
39
-
30
21
17
15
13
60
18
201
872
20
8
2
37
6
7
2
(3)
(1)
(58)
-
-
-
-
2
6
3
(3)
1
8
11
4
52
-
-
-
-
-
-
-
-
-
-
72
-
-
39
-
-
-
-
-
(68)
(23)
(108)
(88)
(49)
(6)
-
(49)
(5)
(6)
-
-
-
-
-
-
-
-
-
-
-
-
(6)
(3)
(6)
6
(124)
(189)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(189)
(7)
15
(1)
3
-
58
(1)
1
1
-
-
-
-
-
-
-
-
-
-
-
-
15
84
49.0%
38.9%
40.4%
49.5%
42.5%
50.0%
50.0%
51.0%
50.0%
50.0%
50.0%
30.0%
42.7%
50.0%
45.0%
20.0%
33.5%
20.0%
35.6%
-
63
29
32
30
16
10
8
4
-
71
50
39
39
33
22
17
12
14
-
-
118
607
The “change in scope of consolidation” item includes the
The application of the equity method to the investments
impact of the deconsolidation of solar assets in Italy fol-
in RusEnergoSbyt and PowerCrop incorporates implicit go-
lowing the agreement of October 16, 2015 concerning the
odwill of €28 million and €9 million, respectively.
companies Ultor and Altomonte, as well as the effects of
the full consolidation of Osage and the disposal of a num-
“Reclassification from/to ‘Assets held for sale’” regard the
ber of Portuguese companies of the Renewable Energy
investment held in Hydro Dolomiti Enel, which in view of
Division.
the decisions taken by management meets the require-
228
Annual Report 2015 - €607 million
Millions of euro
Joint arrangements
Hydro Dolomiti Enel
Tejo Energia Produção e Distribuição de
Energia Eléctrica
Empresa de Energía Cundinamarca
RusEnergoSbyt
Energie Electrique de Tahaddart
Electrogas
Transmisora Eléctrica de Quillota
Centrales Hidroeléctricas de Aysén
PowerCrop
Nuclenor
Associates
Ultor
Elica 2
CESI
Altomonte FV
Tecnatom
GNL Quinteros
Suministradora Eléctrica de Cádiz
Terrae
Compañía Eólica Tierras Altas
ENEOP - Eólicas de Portugal
Eevm - Empreendimentos Eólicos do Vale
do Minho
Other
Total
49.0%
38.9%
40.4%
49.5%
42.5%
50.0%
50.0%
51.0%
50.0%
50.0%
-
-
30.0%
42.7%
45.0%
20.0%
33.5%
20.0%
35.6%
36.0%
50.0%
218
61
34
29
29
15
9
8
5
-
-
-
50
39
30
21
17
15
13
60
18
201
872
(3)
(1)
(58)
20
37
8
2
6
7
2
-
-
-
-
2
6
3
1
8
(3)
11
4
52
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
72
39
(68)
(23)
(108)
(88)
22. Equity investments accounted for using the equity method
Investments in joint arrangements and associated companies accounted for using the equity method are as follows.
% holding
Income effect
consolidation
Change in scope of
Dividends
Reclassification from/to
“Assets held for sale”
Other changes
% holding
at Dec. 31, 2014
at Dec. 31, 2015
-
-
(7)
15
-
-
(1)
3
-
58
(1)
-
-
-
1
1
-
-
-
-
-
15
84
-
63
29
32
30
16
10
8
4
-
71
50
39
39
33
22
17
12
14
-
-
118
607
(49)
(6)
-
(49)
(5)
(6)
-
-
-
-
-
-
-
-
-
(6)
(3)
-
-
-
(6)
6
(189)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(124)
(189)
ments of IFRS 5 for classification as assets held for sale at
December 31, 2015.
The following table provides a summary of financial infor-
mation for each joint arrangement and associate of the
Group not classified as held for sale in accordance with
IFRS 5.
49.0%
38.9%
40.4%
49.5%
42.5%
50.0%
50.0%
51.0%
50.0%
50.0%
50.0%
30.0%
42.7%
50.0%
45.0%
20.0%
33.5%
20.0%
35.6%
229
Consolidated financial statementsAnnual Report 2015 Millions of euro
Non-current assets
Current assets
Total assets
Non-current liabilities
Current liabilities
Total liabilities
Equity
at Dec. 31, 2015 at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015 at Dec. 31, 2014 at Dec. 31, 2015 at Dec. 31, 2014
at Dec. 31, 2015 at Dec. 31, 2014 at Dec. 31, 2015 at Dec. 31, 2014
Joint arrangements
Centrales Hidroeléctricas
de Aysén
RusEnergoSbyt
Tejo Energia Produção e
Distribuição de Energia
Eléctrica
Empresa de Energía
Cundinamarca
Energie Electrique de
Tahaddart
PowerCrop
Nuclenor
Associates
Ultor
Elica 2
Altomonte FV
Tecnatom
Suministradora Eléctrica
de Cádiz
Compañía Eólica Tierras
Altas
20
4
326
147
120
41
69
77
5
212
77
76
40
9
2
378
169
132
41
74
-
6
-
72
77
44
1
108
140
19
32
16
79
20
2
19
69
16
4
12
105
139
18
34
12
99
-
3
-
63
19
7
21
112
466
166
152
57
148
97
7
231
146
92
44
21
107
517
187
166
53
173
-
9
-
135
96
51
214
261
-
-
-
-
72
26
1
98
147
28
24
2
-
-
-
-
-
-
81
43
108
26
26
12
4
104
90
21
33
33
69
-
-
6
46
17
4
5
98
101
22
32
27
86
-
-
-
42
19
3
5
104
304
93
59
34
167
-
-
153
74
41
6
5
98
362
103
75
27
194
-
-
-
68
45
15
16
8
162
73
93
23
(19)
97
7
78
72
51
38
16
9
155
84
91
26
(21)
-
9
-
67
51
36
230
Annual Report 2015 Millions of euro
Non-current assets
Current assets
Total assets
Non-current liabilities
Current liabilities
Total liabilities
Equity
at Dec. 31, 2015 at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015 at Dec. 31, 2014 at Dec. 31, 2015 at Dec. 31, 2014
at Dec. 31, 2015 at Dec. 31, 2014 at Dec. 31, 2015 at Dec. 31, 2014
Joint arrangements
Centrales Hidroeléctricas
de Aysén
RusEnergoSbyt
Tejo Energia Produção e
Distribuição de Energia
Eléctrica
Empresa de Energía
Cundinamarca
Energie Electrique de
Tahaddart
PowerCrop
Nuclenor
Associates
Ultor
Elica 2
Altomonte FV
Tecnatom
Suministradora Eléctrica
de Cádiz
Compañía Eólica Tierras
Altas
20
4
326
147
120
41
69
77
5
212
77
76
40
9
2
378
169
132
41
74
-
6
-
72
77
44
1
108
140
19
32
16
79
20
2
19
69
16
4
12
105
139
18
34
12
99
-
3
-
63
19
7
21
112
466
166
152
57
148
97
7
231
146
92
44
21
107
517
187
166
53
173
-
9
-
135
96
51
-
-
214
72
26
1
98
-
-
147
28
24
2
-
-
261
81
43
-
108
-
-
-
26
26
12
4
104
90
21
33
33
69
-
-
6
46
17
4
5
98
101
22
32
27
86
-
-
-
42
19
3
5
104
304
93
59
34
167
-
-
153
74
41
6
5
98
362
103
75
27
194
-
-
-
68
45
15
16
8
162
73
93
23
(19)
97
7
78
72
51
38
16
9
155
84
91
26
(21)
-
9
-
67
51
36
231
Consolidated financial statementsAnnual Report 2015 Millions of euro
Total revenue
Income before tax
Net income from continuing operations
at Dec. 31, 2015 at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
Joint arrangements
Centrales Hidroeléctricas
de Aysén
RusEnergoSbyt
Tejo Energia Produção e
Distribuição de Energia
Eléctrica
Empresa de Energía
Cundinamarca
Energie Electrique de
Tahaddart
PowerCrop
Nuclenor
Associates
Ultor
Elica 2
Altomonte FV
Tecnatom
Suministradora Eléctrica
de Cádiz
Compañía Eólica Tierras
Altas
23. Derivatives
-
2,019
221
119
55
2
8
-
-
10
5
15
11
-
1,834
195
108
52
3
25
-
-
-
97
16
10
(7)
94
29
10
26
(2)
(14)
87
22
13
23
(3)
(7)
76
21
4
18
(2)
(2)
68
16
8
16
(2)
(42)
(113)
(46)
(112)
-
-
2
5
8
3
-
-
-
3
8
-
-
-
2
5
8
3
-
-
-
3
8
-
Millions of euro
Non-current
Current
Derivative financial assets
Derivative financial liabilities
2,343
1,518
1,335
2,441
5,073
5,509
5,500
5,441
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
For more information on derivatives classified as non-current financial assets, please see note 44 for hedging derivatives and
trading derivatives.
232
Annual Report 2015 24. Other non-current financial assets - €3,274 million
Millions of euro
Equity investments in other companies
measured at fair value
Equity investments in other companies
Receivables and securities included in
net financial debt (see note 24.1)
Service concession arrangements
Non-current prepaid financial expense
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
181
56
2,335
631
71
3,274
157
56
2,701
669
62
3,645
24
-
(366)
(38)
9
(371)
15.3%
-
-13.6%
-5.7%
14.5%
-10.2%
“Other non-current financial assets” decreased by €371 mil-
so, in the absence of plans to sell them, are carried at cost
lion on 2014. In particular, the decline reflected a reduction
adjusted for any impairment losses.
of receivables included in net financial debt, as discussed in
note 24.1.
Equity investments in other companies measured at fair va-
“Equity investments in other companies” includes compa-
lue and at cost break down as follows.
nies whose market value cannot be readily determined and
Millions of euro
% holding
% holding
Bayan Resources
Echelon
Galsi
Other
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
10.0%
7.1%
17.6%
175
2
17
43
237
10.0%
7.1%
15.6%
147
4
15
47
213
28
(2)
2
(4)
24
The change on the previous year essentially reflects the in-
“Service concession arrangements” regard amounts due
crease in the fair value of Bayan Resources, an Indonesian
from the grantor for the construction and/or improvement
company that operates in the coal extraction industry, as
of infrastructure used to provide public services on a con-
based on market prices for its stock.
cession basis and recognized in application of IFRIC 12.
233
Consolidated financial statementsAnnual Report 2015 24.1 Other non-current financial assets included in net financial debt -
€2,335 million
Millions of euro
Securities held to maturity
Financial investments in funds or portfolio management
products at fair value through profit or loss
Financial receivables in respect of Spanish electrical system
deficit
Other financial receivables
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
117
45
2
2,171
2,335
139
40
-
2,522
2,701
(22)
-15.8%
5
2
(351)
(366)
12.5%
-
-13.9%
-13.6%
“Other financial receivables” decreased by €351 million in
> a decrease of €259 million as a result of the collection of
2015 compared with the previous year. The change mainly
the financial receivable in respect of ENEOP (accounted
reflects the following factors:
for using the equity method in 2014) following its disposal
> the reclassification to short term of €48 million of recei-
in 2015;
vables in respect of the Electricity Equalization Fund, to-
> a decrease of €126 million in the receivable of the Argen-
taling €386 million at December 31, 2015 (€434 million
tine generation companies in respect of the wholesale
at December 31, 2014), regarding the reimbursement of
electricity market deposited with the FONINVEMEM
non-recurring charges connected with the early replace-
(Fondo Nacional de Inversión Mercado Eléctrico Mayo-
ment of electromechanical meters;
rista);
> the reclassification to short term of €57 million of the re-
ceivable in respect of the reimbursement, provided for by
> a decrease of €96 million in the receivable for CO2 emis-
sions allowances connected with “new entrant” plants;
the Authority for Electricity, Gas and the Water System in
> an increase of €308 million following recognition by the
Italy with Resolution 157/2012, of costs incurred with the
Argentine authority of the transformation into US dollars
termination of the Electrical Worker Pension Fund in the
of the receivable for the construction of the Vuelta de
total amount of €336 million at December 31, 2015 (€393
Obligado plant after essentially being completed.
million at December 31, 2014);
25. Other non-current assets - €877 million
Millions of euro
at Dec. 31, 2015
at Dec. 31, 2014
Change
Receivables due from equalization funds, market operators and
energy services operators
Other receivables
Total
67
810
877
59
826
885
8
(16)
(8)
13.6%
-1.9%
-0.9%
At December 31, 2015, “other receivables” mainly regard
of €141 million (€141 million at December 31, 2014) and non-
tax receivables in the amount of €463 million (€501 million
monetary grants to be received in respect of green certifica-
at December 31, 2014), advances to suppliers in the amount
tes totaling €78 million (€46 million at December 31, 2014).
234
Annual Report 2015 26. Inventories - €2,904 million
Millions of euro
Raw materials, consumables and supplies:
- fuel
- materials, equipment and other inventories
Total
Environmental certificates:
- CO2 emissions allowances
- green certificates
- white certificates
Total
Buildings available for sale
Payments on account
TOTAL
at Dec. 31, 2015
at Dec. 31, 2014
Change
1,212
819
2,031
680
78
1
759
68
46
1,533
759
2,292
623
294
3
920
76
46
2,904
3,334
(321)
60
(261)
57
(216)
(2)
(161)
(8)
-
(430)
-20.9%
7.9%
-11.4%
9.1%
-73.5%
-66.7%
-17.5%
-10.5%
-
-12.9%
Raw materials, consumables and supplies consist of fuel
other fuels, primarily reflecting a decline in average prices,
inventories to cover the requirements of the generation
and in stocks of white certificates. The contraction was only
companies and trading activities, as well as materials and
partly offset by an increase in inventories of green certifica-
equipment for the operation, maintenance and construction
tes and other materials and equipment. The buildings availa-
of plants and distribution networks. The decrease for the
ble for sale are related to remaining units from the Group’s
year is mainly attributable to the decline in stocks of gas and
real estate portfolio and are primarily civil buildings.
27. Trade receivables - €12,797 million
Millions of euro
Customers:
- sale and transport of electricity
- distribution and sale of natural gas
- other activities
Total customer receivables
Trade receivables due from associates and joint arrangements
TOTAL
at Dec. 31, 2015
at Dec. 31, 2014
Change
9,603
1,755
1,396
12,754
43
12,797
8,361
1,679
1,920
11,960
62
12,022
1,242
76
(524)
794
(19)
775
14.9%
4.5%
-27.3%
6.6%
-30.6%
6.4%
Trade receivables from customers are recognized net of allo-
Authority for Electricity, Gas and the Water System, as di-
wances for doubtful accounts, which totaled €2,085 million
scussed in greater detail in note 7.a above.
at the end of the year, compared with an opening balance of
The decrease in other activities reflects an increase in collec-
€1,662 million. More specifically, the increase for the period
tions in 2015 in respect of fuel sales.
mainly reflects an increase in revenue from the transport
For more details on trade receivables, please see note 41
of qualifying electricity following Resolution 654/2015 of the
“Financial instruments”.
235
Consolidated financial statementsAnnual Report 2015 28. Other current financial assets - €2,381 million
Millions of euro
Current financial assets included in net financial position
Other
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
2,241
140
2,381
3,860
124
3,984
(1,619)
16
(1,603)
-41.9%
12.9%
-40.2%
28.1 Other current financial assets included in net financial debt - €2,241
million
Millions of euro
Short-term portion of long-term financial receivables
Receivables for factoring
Securities held to maturity
Financial receivables and cash collateral
Other
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
769
147
1
1,020
304
2,241
1,566
177
-
1,654
463
3,860
(797)
(30)
1
(634)
(159)
(1,619)
-50.9%
-16.9%
-
-38.3%
-34.3%
-41.9%
The change in “short-term portion of long-term financial re-
totaling €1,263 million (also including new receivables for
ceivables” is mainly accounted for by a decrease in financial
extra-peninsular generation). The decrease was only partly
receivables in respect of the deficit of the Spanish electrical
offset by the reclassification of the short-term portion of the
system following the collections received (€2,145 million
receivable from the Electricity Equalization Fund in respect
including the effect of reimbursements for extra-peninsular
of the reimbursement of non-recurring charges, which were
generation) and net of new receivables accrued in 2015
mentioned in note 24.1.
29. Other current assets - €2,898 million
Millions of euro
Receivables due from equalization funds, market operators and
energy services operators
Advances to suppliers
Receivables due from employees
Receivables due from others
Sundry tax receivables
Accrued operating income and prepaid expenses
Receivables for construction contracts
at Dec. 31, 2015
at Dec. 31, 2014
Change
765
219
26
960
706
174
48
1,010
166
33
1,272
759
184
41
(245)
53
(7)
(312)
(53)
(10)
7
(567)
-24.3%
31.9%
-21.2%
-24.5%
-7.0%
-5.4%
17.1%
-16.4%
Total
2,898
3,465
“Receivables due from equalization funds, market opera-
(€896 million at December 31, 2014) and the Spanish sy-
tors and energy services operators“ include receivables in
stem in the amount of €101 million (€114 million at Decem-
respect of the Italian system in the amount of €664 million
ber 31, 2014). Including the portion of receivables classified
236
Annual Report 2015 as long-term in the amount of €67 million (€59 million in
totaled €832 million (€1,069 million at December 31, 2014),
2014), receivables due from equalization funds, market ope-
with payables of €5,122 million (€4,005 million at December
rators and energy services operators at December 31, 2015
31, 2014).
30. Assets classified as held for sale - €6,854 million
Changes in assets held for sale during the year are reported in the following table.
Millions of euro
Reclassification
from/to current
and non-current
assets
Disposals and
change in scope
of consolidation
at Dec. 31, 2014
Impairment
losses Other changes at Dec. 31, 2015
Property, plant and equipment
Intangible assets
Deferred tax assets
Equity investments accounted for using
the equity method
Non-current financial assets
Other non-current assets
Cash and cash equivalents
Current financial assets
Inventories, trade receivables and other
current assets
Total
3,882
224
1,066
18
976
18
27
42
525
6,778
-
-
-
189
5
-
111
-
-
305
(94)
(212)
(8)
-
-
-
(12)
-
(43)
(369)
(574)
-
-
-
-
-
-
-
-
(574)
530
(5)
8
2
85
-
24
69
1
714
3,744
7
1,066
209
1,066
18
150
111
483
6,854
Assets held for sale amounted to €6,854 million at Decem-
“Disposals and change in scope of consolidation” mainly in-
ber 31, 2015. They largely include the assets of Slovenské
clude the disposals of SF Energy and SE Hydropower in the
elektrárne (€6,549 million), Hydro Dolomiti Enel (€189 mil-
1st half of 2015.
lion), Compostilla RE (€111 million) and other smaller compa-
nies, which in view of the decisions taken by management
“Impairment losses” at December 31, 2015 amounted to
meet the requirements of IFRS 5 for classification as assets
€574 million and regarded Slovenské elektrárne; for more
held for sale.
details, please see note 8.d.
237
Consolidated financial statementsAnnual Report 2015 31. Liabilities included in disposal groups classified as held
for sale - €5,364 million
Liabilities held for sale at December 31, 2015 amounted to
Changes in liabilities held for sale during the year are as fol-
€5,364 million. They largely included the liabilities of Slo-
lows.
venské elektrárne (€5,335 million), Compostilla RE (€29 mil-
lion) and other smaller companies.
Millions of euro
Reclassification
from/to current
and non-current
liabilities
Disposals and
change in scope of
consolidation
at Dec. 31, 2014
Other changes
at Dec. 31, 2015
Long-term borrowings
Employee benefits
Non-current portion of provisions for risks
and charges
Deferred tax liabilities
Non-current financial liabilities
Other non-current liabilities
Short-term borrowings
Other current financial liabilities
Current portion of provisions for risks and
charges
Trade payables and other current liabilities
1,422
67
2,305
669
148
1
191
47
43
397
-
-
-
29
-
-
-
-
-
-
Total
5,290
29
(15)
(1)
(4)
(82)
-
-
(8)
-
-
(22)
(132)
294
2
(434)
23
83
1
156
64
(24)
12
177
1,701
68
1,867
639
231
2
339
111
19
387
5,364
The change in liabilities held for sale compared with Decem-
For a summary of the fair value balances, broken down by
ber 31, 2014 largely reflects the classifications and disposals
measurement criteria, please see notes 45 and 46 on IFRS
made under this item during 2015.
13 disclosures.
238
Annual Report 2015 32. Shareholders’ equity - €51,751 million
32.1 Equity attributable to the shareholders of the Parent Company -
€32,376 million
Share capital - €9,403 million
At December 31, 2015 (as at December 31, 2014), the sha-
re capital of Enel SpA – considering that there were no ap-
Reserve from translation of financial state-
ments in currencies other than euro - €(1,956)
million
The decrease for the year, equal to €635 million, is due to
proved stock option plans (and thus no options exercised)
the net appreciation of the functional currency against the
– amounted to €9,403,357,795 fully subscribed and paid up,
foreign currencies used by subsidiaries.
represented by 9,403,357,795 ordinary shares with a par va-
lue of €1.00 each.
At the same date, based on the shareholders register and the
notices submitted to CONSOB and received by the Company
Reserve from measurement of cash flow hed-
ge financial instruments - €(1,341) million
This includes the net charges recognized in equity from the
pursuant to Article 120 of Legislative Decree 58 of Februa-
measurement of cash flow hedge derivatives. The cumulati-
ry 24, 1998, as well as other available information, no sha-
ve tax effect is equal to €405 million.
reholders held more than 2% of the total share capital, apart
from the Ministry for the Economy and Finance, which holds
25.50%, Norges Bank (with 2.018% of share capital, a stake
that fell below 2% on January 8, 2016) and CNP Assurances
Reserve from measurement of financial in-
struments available for sale - €130 million
This includes net unrealized income from the measurement
(which held 2.87% as at June 23, 2015 for asset management
at fair value of financial assets.
purposes).
There is no cumulative tax effects associated with the re-
serve, taking account of the tax systems of the countries in
Other reserves - €3,352 million
which those financial instruments are held.
Share premium reserve - €5,292 million
Pursuant to Article 2431 of the Italian Civil Code, the share pre-
mium reserve contains, in the case of the issue of shares at
Reserve from equity investments accounted
for using the equity method - €(54) million
The reserve reports the share of comprehensive income to
a price above par, the difference between the issue price of
be recognized directly in equity of companies accounted for
the shares and their par value, including those resulting from
using the equity method. The cumulative tax effect is equal
conversion from bonds. The reserve, which is a capital reser-
to €13 million.
ve, may not be distributed until the legal reserve has reached
the threshold established under Article 2430 of the Italian Civil
Code.
Reserve from remeasurement of net defined
benefit plan liabilities/(assets) - €(551) million
The reserve includes all actuarial gains and losses, net of tax
Legal reserve - €1,881 million
The legal reserve is formed of the part of net income that,
effects. The change is attributable to the increase in net ac-
tuarial losses recognized during the period. The cumulative
pursuant to Article 2430 of the Italian Civil Code, cannot be
tax effect is equal to €83 million.
distributed as dividends.
Other reserves - €2,262 million
These include €2,215 million related to the remaining portion
Reserve from disposal of equity interests wi-
thout loss of control - €(2,115) million
This item reports:
of the value adjustments carried out when Enel was tran-
> the gain posted on the public offering of Enel Green Po-
sformed from a public entity to a joint-stock company.
wer shares, net of expenses associated with the dispo-
Pursuant to Article 47 of the Uniform Income Tax Code (Te-
sal and the related taxation;
sto Unico Imposte sul Reddito), this amount does not con-
> the sale of minority interests recognized as a result of
stitute taxable income when distributed.
the Enersis capital increase;
239
Consolidated financial statementsAnnual Report 2015 > the capital loss, net of expenses associated with the di-
lowing the exercise of the bonus share option by the minori-
sposal and the related taxation, from the public offering
ty shareholders of Endesa, which resulted in the disposal of
of 21.92% of Endesa.
0.04% of that company, and the income from the disposal
The change for the period, a negative €2 million, represents
of minority interests in Enel Green Power North America Re-
the net balance between the capital loss recognized fol-
newable Energy Partners.
Reserve from transactions in non-controlling
interests - €(196) million
The reserve reports the amount by which the purchase pri-
Eléctrica Cabo Blanco, Coelce, Generandes Perú, Enersis
and Endesa Latinoamérica) exceeds the value of the equity
acquired. The change for the period, a negative €3 million,
ce in purchases from third parties of additional stakes in
regards the difference between the purchase price and the
companies already controlled in Latin America (generated in
associated share of equity acquired from non-controlling
previous years by the purchase of additional stakes in Am-
shareholders of Energia Eolica.
pla Energia e Serviços, Ampla Investimentos e Serviços,
Retained earnings and loss carried forward -
€19,621 million
The reserve reports earnings from previous years that have
The table below shows the changes in gains and losses re-
cognized directly in other comprehensive income, including
non-controlling interests, with specific reporting of the rela-
not been distributed or allocated to other reserves.
ted tax effects.
at Dec. 31, 2014
Changes
at Dec. 31, 2015
Of which
shareholders
of the Parent
Company
Of which
non-
controlling
interests
Total
Gains/
(Losses)
recognized
in equity for
the year
Released
to income
statement Taxes Total
Of which
shareholders
of the Parent
Company
Of which
non-
controlling
interests
Of which
shareholders
of the Parent
Company
Of which
non-
controlling
interests
Total
(3,112)
(1,321)
(1,791)
(1,743)
-
- (1,743)
(635)
(1,108) (4,855)
(1,956)
(2,899)
(2,056)
(1,806)
(250)
29
101
229
359
465
(106) (1,697)
(1,341)
(356)
104
105
(1)
25
-
-
25
25
-
129
130
(1)
(73)
(74)
1
23
8
(2)
29
20
9
(44)
(54)
10
(872)
(671)
(201)
344
-
(160)
184
120
64
(688)
(551)
(137)
(6,009)
(3,767)
(2,242)
(1,322)
109
67 (1,146)
(5)
(1,141) (7,156)
(3,772)
(3,383)
Millions of euro
Reserve from
translation
of financial
statements in
currencies other
than euro
Reserve from
measurement
of cash flow
hedge financial
instruments
Reserve from
measurement
of financial
instruments
available for sale
Share of OCI
of equity
investments
accounted for
using the equity
method
Remeasurements
of net employee
benefit liabilities/
(assets)
Total gains/
(losses)
recognized in
equity
240
Annual Report 2015 32.2 Dividends
Net dividends paid in 2014
Dividends for 2013
Interim dividends for 2014
Extraordinary dividends
Total dividends paid in 2014
Net dividends paid in 2015
Dividends for 2014
Interim dividends for 2015
Extraordinary dividends
Total dividends paid in 2015
Amount distributed
(millions of euro)
Net dividend per share
(euro)
1,222
-
-
1,222
1,316
-
-
1,316
0.13
-
-
0.13
0.14
-
-
0.14
The dividend for 2015, equal to €0.16 per share, for a total of
reflect the impact of the distribution of the dividend for 2015
€1,627 million, was proposed to the Shareholders’ Meeting
to shareholders.
called for May 26, 2016. These financial statements do not
Capital management
The Group’s objectives for managing capital comprise safe-
In this context, the Group manages its capital structure and
adjusts that structure when changes in economic conditions
guarding the business as a going concern, creating value for
so require. There were no substantive changes in objectives,
stakeholders and supporting the development of the Group.
policies or processes in 2015.
In particular, the Group seeks to maintain an adequate capi-
To this end, the Group constantly monitors developments
talization that enables it to achieve a satisfactory return for
in the level of its debt in relation to equity. The situation at
shareholders and ensure access to external sources of fi-
December 31, 2015 and 2014 is summarized in the following
nancing, in part by maintaining an adequate rating.
table.
Millions of euro
Non-current financial position
Net current financial position
Non-current financial receivables and long-term securities
Net financial debt
Equity attributable to the shareholders of the Parent Company
Non-controlling interests
Shareholders’ equity
Debt/equity ratio
at Dec. 31, 2015
at Dec. 31, 2014
44,872
(4,992)
(2,335)
37,545
32,376
19,375
51,751
0.73
48,655
(8,571)
(2,701)
37,383
31,506
19,639
51,145
0.73
Change
(3,783)
3,579
366
162
870
(264)
606
-
241
Consolidated financial statementsAnnual Report 2015 32.3 Non-controlling interests - €19,375 million
The following table reports the composition of non-controlling interests by Division.
Non-controlling
interests
Net income
attributable to
non-controlling
interests
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
6,742
8,052
803
386
3,392
19,375
6,648
8,690
1,134
385
2,782
19,639
280
1,032
(275)
(3)
142
1,176
116
464
31
(523)
167
255
Millions of euro
Endesa Group
Enel Latinoamérica Group
EIH Group
Slovenské Group
Enel Green Power Group
Total
33. Borrowings
Millions of euro
Non-current
Current
Long-term borrowings
Short-term borrowings
Total
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
44,872
-
44,872
48,655
-
48,655
5.733
2.155
7,888
5,125
3,252
8,377
For more details on the nature of borrowings, please see note 41 “Financial instruments”.
242
Annual Report 2015 34. Employee benefits - €2,284 million
The Group provides its employees with a variety of bene-
tricity workers national collective bargaining agreement
fits, including deferred compensation benefits, additional
to a bonus for achievement of seniority milestones (25th
months’ pay for having reached age limits or eligibility for
and 35th year of service). It also includes other incentive
old-age pension, loyalty bonuses for achievement of senio-
plans, which provide for the award to certain Company
rity milestones, supplemental retirement and healthcare
managers of a monetary bonus subject to specified con-
plans, residential electricity discounts (which for companies
ditions.
in Italy only regarded certain retired employees) and similar
benefits. More specifically:
Outside of Italy, major pension plans include those of Ende-
sa, in Spain, which break down into three types that differ
> for Italy, the item “pension benefits” regards estimated
on the basis of employee seniority and company. In gene-
accruals made to cover benefits due under the supple-
ral, under the framework agreement of October 25, 2000,
mental retirement schemes of retired executives and the
employees participate in a specific defined-contribution
benefits due to personnel under law or contract at the
pension plan and, in cases of disability or death of emplo-
time the employment relationship is terminated. For the
yees in service, a defined benefit plan which is covered by
foreign companies, the item reports post-employment
appropriate insurance policies. In addition, the group has
benefits;
two other limited-enrollment plans: (i) for current and retired
> the item “electricity discount” comprises benefits regar-
Endesa employees covered by the electricity industry col-
ding electricity supply associated with foreign compa-
lective bargaining agreement prior to the changes introdu-
nies. For Italy, that benefit, which was granted until the
ced with the framework agreement noted earlier; and (ii) for
end of 2015 to retired employees only, was unilaterally
employees of the former Catalan companies (Fecsa/Enher/
cancelled;
HidroEmpordà). Both are defined benefit plans and benefits
> the item “health insurance” reports benefits for current or
are fully ensured, with the exception of the former plan for
retired employees covering medical expenses;
benefits in the event of the death of a retired employee.
> the item “other benefits” mainly regard the loyalty bonus,
Finally, the Brazilian companies have also established defi-
which for Italy is represented by the estimated liability
ned benefit plans.
for the benefit entitling employees covered by the elec-
243
Consolidated financial statementsAnnual Report 2015 The following table reports changes in the defined benefit
2014, respectively, as well as a reconciliation of that obliga-
obligation for post-employment and other long-term em-
tion with the actuarial liability.
ployee benefits at December 31, 2015 and December 31,
Millions of euro
2015
2014
Pension
benefits
Electricity discount Health insurance Other benefits
Total
Pension benefits
Electricity discount
Health insurance
Other benefits
CHANGES IN ACTUARIAL OBLIGATION
Actuarial obligation at the start of the year
2,458
1,927
223
Current service cost
Interest expense
Actuarial (gains)/losses arising from changes in
demographic assumptions
Actuarial (gains)/losses arising from changes in financial
assumptions
Experience adjustments
Past service cost
(Gains)/Losses arising from settlements
Exchange differences
Employer contributions
Employee contributions
Benefits paid
Other changes
Liabilities classified as held for sale
Actuarial obligation at year-end (A)
CHANGES IN PLAN ASSETS
Fair value of plan assets at the start of the year
Interest income
Expected return on plan assets excluding amounts
included in interest income
Exchange differences
Employer contributions
Employee contributions
Benefits paid
Other payments
Change in scope of consolidation
Fair value of plan assets at year-end (B)
EFFECT OF ASSET CEILING
Asset ceiling at the start of the year
Interest income
Changes in asset ceiling
Exchange differences
Change in scope of consolidation
Asset ceiling at year-end (C)
24
106
1
(124)
10
(43)
1
(157)
-
1
(154)
4
(1)
2,126
1,252
68
(30)
(125)
98
1
(154)
-
-
1,110
68
5
2
(18)
-
57
6
41
-
(66)
(196)
-
(902)
(1)
-
-
(88)
3
-
724
-
-
-
-
88
-
(88)
-
-
-
-
-
-
-
-
-
5
10
-
(8)
2
-
-
(17)
-
-
263
54
8
-
4
4
(5)
-
(6)
-
-
4,871
89
165
1
(194)
(180)
(48)
(901)
(181)
-
1
(13)
(39)
(294)
-
-
2
-
9
(1)
202
285
3,337
-
-
-
-
13
-
(13)
-
-
-
-
-
-
-
-
-
-
-
-
-
24
-
(24)
-
-
-
-
-
-
-
-
-
1,252
68
(30)
(125)
223
1
(279)
-
-
1,110
68
5
2
(18)
-
57
Net liability in balance sheet (A-B+C)
1,073
724
202
285
2,284
1,927
223
263
244
2,366
1,848
17
125
1
270
(24)
(4)
8
(4)
-
1
5
(237)
(66)
2,458
1,187
82
28
4
186
(237)
1,251
58
1
-
-
7
2
-
-
67
1,274
6
60
1
173
(39)
(36)
(88)
1,927
88
(88)
-
-
-
-
2
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
209
4
11
-
9
5
(2)
(1)
-
-
-
1
-
(13)
223
13
(13)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
362
48
10
1
(7)
(17)
(24)
(18)
(89)
(2)
(1)
263
22
(22)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
4,785
75
206
445
(75)
(66)
(23)
(427)
(67)
4,871
1,187
82
28
309
(360)
1,251
58
3
8
-
1
6
4
1
-
-
7
2
-
-
67
3,687
Annual Report 2015
Millions of euro
2015
2014
benefits
Electricity discount Health insurance Other benefits
Total
Pension benefits
Electricity discount
Health insurance
Other benefits
2,366
1,848
17
125
1
270
(24)
(4)
8
(4)
-
1
(237)
5
(66)
2,458
1,187
82
28
4
186
1
(237)
-
-
1,251
58
7
2
-
-
67
1,274
6
60
1
173
(39)
(36)
-
-
-
-
(88)
2
-
1,927
-
-
-
-
88
-
(88)
-
-
-
-
-
-
-
-
-
209
4
11
-
9
5
(2)
-
(1)
-
-
(13)
1
-
223
-
-
-
-
13
-
(13)
-
-
-
-
-
-
-
-
-
362
48
10
1
(7)
(17)
(24)
-
(18)
-
-
(89)
(2)
(1)
263
-
-
-
-
22
-
(22)
-
-
-
-
-
-
-
-
-
1,927
223
263
CHANGES IN ACTUARIAL OBLIGATION
Actuarial obligation at the start of the year
Current service cost
Interest expense
Actuarial (gains)/losses arising from changes in
demographic assumptions
Actuarial (gains)/losses arising from changes in financial
(Gains)/Losses arising from settlements
assumptions
Experience adjustments
Past service cost
Exchange differences
Employer contributions
Employee contributions
Benefits paid
Other changes
Liabilities classified as held for sale
Actuarial obligation at year-end (A)
CHANGES IN PLAN ASSETS
Fair value of plan assets at the start of the year
Interest income
Expected return on plan assets excluding amounts
included in interest income
Exchange differences
Employer contributions
Employee contributions
Benefits paid
Other payments
EFFECT OF ASSET CEILING
Asset ceiling at the start of the year
Interest income
Changes in asset ceiling
Exchange differences
Change in scope of consolidation
Asset ceiling at year-end (C)
Pension
2,458
24
106
(124)
10
(43)
(157)
1
1
-
1
4
(154)
(1)
2,126
1,252
68
(30)
(125)
98
1
(154)
68
-
-
5
2
-
(18)
57
1,073
Change in scope of consolidation
Fair value of plan assets at year-end (B)
1,110
1,927
6
41
(66)
(196)
(902)
(1)
(88)
3
-
724
88
(88)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
263
54
8
-
4
4
(5)
(6)
-
-
-
2
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,871
89
165
1
(194)
(180)
(48)
(901)
(181)
-
1
9
(1)
1,252
68
(30)
(125)
223
1
-
-
1,110
68
5
2
-
57
(18)
(13)
(39)
(294)
202
285
3,337
13
24
(13)
(24)
(279)
223
5
10
(8)
2
(17)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Net liability in balance sheet (A-B+C)
724
202
285
2,284
Total
4,785
75
206
3
445
(75)
(66)
8
(23)
-
1
(427)
6
(67)
4,871
1,187
82
28
4
309
1
(360)
-
-
1,251
58
7
2
-
-
67
3,687
245
Consolidated financial statementsAnnual Report 2015
Millions of euro
(Gains)/Losses charged to profit or loss
Service cost and past service cost
Net interest expense
(Gains)/Losses arising from settlements
Actuarial (gains)/losses on other long-term benefits
Other changes
Total
Millions of euro
Change in (gains)/losses in OCI
Return on plan assets excluding amounts included in interest income
Actuarial (gains)/losses on defined benefit plans
Changes in asset ceiling excluding amounts included in interest income
Other changes
Total
2015
(5)
102
(901)
46
1
(757)
2015
30
(374)
2
(2)
(344)
2014
(26)
131
8
34
7
154
2014
(28)
366
2
-
340
The change in cost recognized through profit or loss is mainly
adjustment of the liability in respect of other employee bene-
attributable to the cancellation (with effect from the end of
fit plans, with a positive impact in respect of past service cost
December 2015), for the Italian companies only, of the elec-
of €48 million.
tricity discount benefit, which involved the reversal of the as-
The liability recognized in the balance sheet at the end of the
sociated liability.
year is reported net of the fair value of plan assets, entirely
In addition, the supplemental provisions of the union agre-
accounted for by the Enersis Group and the Endesa Group,
ements implementing the new plan under Article 4 of the
amounting to €1,110 million at December 31, 2015.
Fornero Act established in December 2015 prompted an
The plan assets break down as follows:
2015
4%
25%
4%
1%
-
67%
100%
2014
5%
29%
5%
-
-
61%
100%
Investment quoted in active markets
Equity instruments
Fixed-income securities
Investment property
Other
Unquoted investments
Assets held by insurance undertakings
Other
Total
246
Annual Report 2015 The main actuarial assumptions used to calculate the liabi-
which are consistent with those used the previous year, are
lities in respect of employee benefits and the plan assets,
set out in the following table.
Italy
Iberian
Peninsula
Latin
America
Other
Italy
Peninsula Latin America
Other
Iberian
2015
2014
0.5%-2.15% 1.17%-2.56% 4.95%-14.21% 2.03%-9.72% 0.50%-2.15% 0.87%-2.11% 4.60%-12.52% 1.60%-13.89%
1.60%
2.00% 3.00%-6.50% 1.50%-5.50%
1.60%
2.30% 3.00%-6.00% 1.75%-5.00%
1.60%-3.60%
2.00% 3.00%-9.69% 2.00%-5.50% 1.60%-3.60%
2.30% 3.00%-9.18% 1.75%-5.00%
2.60%
3.20% 4.20%-9.69%
-
2.54% 4.18%-14.21%
-
-
2.60%
3.50% 3.50%-8.66%
-
2.06%
12.52%
-
-
Discount rate
Inflation rate
Rate of wage
increases
Rate of increase in
healthcare costs
Expected rate of
return on plan
assets
The following table reports the outcome of a sensitivity
of the year in the actuarial assumptions used in estimating
analysis that demonstrates the effects on the defined be-
the obligation.
nefit obligation of changes reasonably possible at the end
Millions of euro
Decrease of 0.5% in
discount rate
Increase of 0.5% in
discount rate
Increase of 0.5% in
inflation rate
Decrease of 0.5% in
inflation rate
Increase of 0.5% in
remuneration
Increase of 0.5% in
pensions currently being
paid
Increase of 1% in
healthcare costs
Increase of 1 year in life
expectancy of active
and retired employees
Pension
benefits
Electricity
discount
Health
insurance
Other
benefits
Pension
benefits
Electricity
discount
Health
insurance
Other
benefits
at Dec. 31, 2015
at Dec. 31, 2014
131
(116)
33
(26)
8
11
-
47
60
(54)
59
(38)
-
-
-
24
12
(12)
8
(9)
-
-
20
3
4
156
58
(10)
(134)
(120)
4
(7)
2
(3)
-
(2)
31
-
27
52
-
17
137
-
-
-
-
81
11
(13)
8
-
-
-
24
11
5
(6)
5
-
7
-
-
1
The sensitivity analysis used an approach that extrapolates
The contributions expected to be paid into defined benefit
the effect on the defined benefit obligation of reasonable
plans in the subsequent year amount to €16 million.
changes in an individual actuarial assumption, leaving the
other assumptions unchanged.
The following table reports expected benefit payments in the coming years for defined benefit plans.
Millions of euro
Within 1 year
In 1-2 years
In 2-5 years
More than 5 years
at Dec. 31, 2015
at Dec. 31, 2014
201
211
601
944
265
257
801
1,406
247
Consolidated financial statementsAnnual Report 2015 35. Provisions for risks and charges - €6,822 million
Millions of euro
Accrual Reversal Utilization
Unwinding of
interest
Change in scope
of consolidation
Translation
adjustment
Other
Millions of euro
Provision for litigation, risks and other charges:
- nuclear decommissioning
- retirement, removal and site restoration
- litigation
- environmental certificates
- taxes and duties
- other
Total
Provision for early retirement incentives
TOTAL
at Dec. 31,
2014
567
599
850
43
316
1,274
3,649
1,589
5,238
Provision for
litigation, risks and
other charges:
- nuclear
decommissioning
- retirement,
removal and site
restoration
- litigation
- environmental
certificates
- taxes and duties
- other
Total
Provision for
early retirement
incentives
TOTAL
at Dec. 31, 2015
at Dec. 31, 2014
Non-current
Current
Non-current
Current
528
611
762
-
290
819
3,010
2,182
5,192
-
11
47
19
20
1,062
1,159
471
1,630
566
594
810
-
309
693
2,972
1,079
4,051
1
5
40
43
7
581
677
510
1,187
at Dec. 31,
2015
-
-
-
14
231
18
43
683
989
(28)
(140)
(38)
(11)
4
(213)
(26)
(101)
(4)
(34)
(209)
(374)
1,630
(52)
2,619
(265)
(526)
(900)
8
9
41
-
6
33
97
15
112
-
(4)
-
-
(1)
1
(4)
-
(4)
-
(47)
528
(3)
(51)
-
(5)
(47)
(106)
-
(106)
61
(21)
-
(4)
142
131
(3)
128
622
809
19
310
1,881
4,169
2,653
6,822
Nuclear decommissioning provision
power plants. The time horizon envisaged, three years, corre-
At December 31, 2015, the provision reflected solely the costs
that will be incurred at the time of decommissioning of nucle-
ar plants by Enresa, a Spanish public enterprise responsible
for such activities in accordance with Royal Decree 1349/2003
and Law 24/2005. Quantification of the costs is based on the
standard contract between Enresa and the electricity compa-
nies approved by the Ministry for the Economy in September
2001, which regulates the retirement and closing of nuclear
sponds to the period from the termination of power genera-
tion to the transfer of plant management to Enresa (so-called
post-operational costs) and takes account, among the various
assumptions used to estimate the amount, of the quantity of
unused nuclear fuel expected at the date of closure of each
of the Spanish nuclear plants on the basis of the provisions of
the concession agreement.
248
Annual Report 2015 Non-nuclear plant retirement and
site restoration provision
The provision for “non-nuclear plant retirement and site re-
storation” represents the present value of the estimated
cost for the retirement and removal of non-nuclear plants
where there is a legal or constructive obligation to do so.
Litigation provision
The “litigation” provision covers contingent liabilities in re-
spect of pending litigation and other disputes. It includes
an estimate of the potential liability relating to disputes that
arose during the period, as well as revised estimates of the
potential costs associated with disputes initiated in prior pe-
riods. The estimates are based on the opinions of internal and
external legal counsel. The balance for litigation mainly re-
gards distribution companies in Brazil (€135 million) and Spain
(€154 million). It primarily regards disputes concerning service
quality and disputes with employees or end users.
The change for the year essentially reflects developments in
a number of disputes, especially in Spain, that arose following
disciplinary proceedings in the distribution area and disputes
with suppliers (€110 million). These were accompanied by an
increase in provisions for litigation in Brazil (€41 million). The
balance of the provision decreased despite accruals for the
period, mainly due to reversals to profit or loss and uses, espe-
cially by Endesa Distribución and the Brazilian companies.
Provision for environmental
certificates
The provision for “environmental certificates” covers costs
in respect of shortfalls in the environmental certificates need
for compliance with national or supranational environmental
protection requirements.
Other provisions
“Other” provisions cover various risks and charges, mainly in
connection with regulatory disputes and disputes with local
authorities regarding various duties and fees or other charges.
In particular in 2015 the item increased significantly as a result
of the provision recognized by the Italian companies for the
lump-sum charge for one-off payments to retired employees,
totaling an estimated €328 million, following the Group’s uni-
lateral decision to cancel the electricity discount benefit, as
well as the provision of €92 million recognized by Enel Re in
respect of potential charges for insurance settlements and the
provision for the abandonment of the Girabolhos project by
Hidromondego of €46 million.
“Other” changes include €142 million for environmental costs
to be incurred in the construction of the El Quimbo plant in Co-
lombia, recognized as a direct increase in the value of the asset.
In addition, the balance for other provisions for risks and char-
ges also includes the provision for current and potential dispu-
tes concerning local property tax (whether the Imposta Comu-
nale sugli Immobili (“ICI”) or the new Imposta Municipale Unica
(“IMU”)) in Italy, the Group has taken due account of the crite-
ria introduced with circular 6/2012 of the Public Land Agency
(which resolved interpretive issues concerning the valuation
methods for movable assets considered relevant for property
registry purposes, including certain assets typical to genera-
tion plants, such as turbines) in estimating the liability for such
taxes, both for the purposes of quantifying the probable risk
associated with pending litigation and generating a reasonable
valuation of probable future charges on positions that have not
yet been assessed by Land Agency offices and municipalities.
Provision for early retirement
incentives
The “provision for early retirement incentives” includes the esti-
mated charges related to binding agreements for the voluntary
termination of employment contracts in response to organizatio-
nal needs. The change for the year reflects, among other factors,
uses for incentive provisions established in Spain and Italy in pre-
vious years, the latter largely associated with the union-company
agreements signed on September 6, 2013, implementing, for a
number of companies in Italy, the mechanism provided for under
Article 4, paragraphs 1-7 ter, of Law 92/2012 (the Fornero Act).
In December 2015, a new agreement was signed in Italy under
the provisions of Article 4 of the Fornero Act. It envisages the vo-
luntary termination of about 6,100 employees in 2016-2020 and
prompted an additional accrual to the provision of about €1,196
million. In addition, during 2015 the Acuerdo de Salida Voluntaria
(ASV) introduced in Spain in 2014 was expanded, with an addi-
tional provision of about €390 million (for about 612 employees).
The ASV mechanism was agreed in Spain in connection with
Endesa’s restructuring and reorganization plan, which provides
for the suspension of the employment contract with tacit annual
renewal. With regard to that plan, on December 30, 2014, the
company had signed an agreement with union representatives
in which it undertook to not exercise the option to request a
return to work at subsequent annual renewal dates for the em-
ployees participating in the mechanism. The provision last year
amounted to €349 million for 473 employees.
249
Consolidated financial statementsAnnual Report 2015 36. Other non-current liabilities - €1,549 million
Millions of euro
Accrued operating expenses and deferred income
Other items
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
966
583
1,549
952
512
1,464
14
71
85
1.5%
13.9%
5.8%
At December 31, 2015, this item essentially consisted of revenue for electricity and gas connections and grants received for
specific assets.
37. Trade payables - €11,775 million
The item amounted to €11,775 million (€13,419 million in
More specifically, trade payables falling due in less than 12
2014) and includes payables in respect of electricity sup-
months amounted to €11,261 million (€12,923 million in 2014),
plies, fuel, materials, equipment associated with tenders
while those falling due in more than 12 months amounted to
and other services.
€514 million (€496 million in 2014).
38. Other current financial liabilities - €1,063 million
Millions of euro
Deferred financial liabilities
Other items
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
957
106
1,063
1,063
114
1,177
(106)
(8)
(114)
-10.0%
-7.0%
-9.7%
“Deferred financial liabilities” regard accrued expense on bonds. It is broadly unchanged on the previous year.
39. Net financial position and long-term financial receivables
and securities - €37,545 million
The following table shows the net financial position and long-term financial receivables and securities on the basis of the
items on the consolidated balance sheet.
Millions of euro
Long-term borrowings
Short-term borrowings
Current portion of long-term borrowings
Non-current financial assets included in debt
Current financial assets included in debt
Cash and cash equivalents
Total
250
Notes at Dec. 31, 2015
at Dec. 31, 2014
Change
41
41
41
24
28
44,872
2,155
5,733
(2,335)
(2,241)
(10,639)
37,545
48,655
3,252
5,125
(2,701)
(3,860)
(13,088)
37,383
(3,783)
(1,097)
608
366
1,619
2,449
162
-7.8%
-33.7%
11.9%
-13.6%
-41.9%
-18.7%
0.4%
Annual Report 2015 Pursuant to the CONSOB instructions of July 28, 2006, the
financial debt as provided for in the presentation methods of
following table reports the net financial position at Decem-
the Enel Group.
ber 31, 2015, and December 31, 2014, reconciled with net
at Dec. 31, 2015
at Dec. 31, 2014
Change
Millions of euro
Cash and cash equivalents on hand
Bank and post office deposits
Securities
Liquidity
Short-term financial receivables
Factoring receivables
Short-term portion of long-term financial receivables
Current financial receivables
Short-term bank debt
Commercial paper
Short-term portion of long-term bank debt
Bonds issued (short-term portion)
Other borrowings (short-term portion)
Other short-term financial payables
Total short-term financial debt
Net short-term financial position
Debt to banks and financing entities
Bonds
Other borrowings
Long-term financial position
NET FINANCIAL POSITION as per CONSOB instructions
Long-term financial receivables and securities
NET FINANCIAL DEBT
There are no transactions with related parties for these items.
582
10,057
1
10,640
1,324
147
769
2,240
(180)
(213)
(844)
(4,570)
(319)
(1,762)
(7,888)
4,992
(6,863)
(35,987)
(2,022)
(44,872)
(39,880)
2,335
(37,545)
758
(176)
-23.2%
12,330
(2,273)
-18.4%
140
(139)
-
13,228
(2,588)
-19.6%
1,977
177
1,566
3,720
(30)
(2,599)
(824)
(4,056)
(245)
(623)
(8,377)
8,571
(7,022)
(39,749)
(1,884)
(48,655)
(40,084)
2,701
(37,383)
(653)
(30)
(797)
-33.0%
-16.9%
-50.9%
(1,480)
-39.8%
(150)
2,386
(20)
(514)
(74)
-
91.8%
-2.4%
-12.7%
-30.2%
(1,139)
-
489
5.8%
(3,579)
-41.8%
159
3,762
(138)
3,783
204
(366)
(162)
2.3%
9.5%
-7.3%
7.8%
0.5%
-13.6%
-0.4%
251
Consolidated financial statementsAnnual Report 2015 40. Other current liabilities - €11,222 million
Millions of euro
at Dec. 31, 2015
at Dec. 31, 2014
Change
Payables due to customers
1,567
1,599
Payables due to equalization funds, market operators and
energy services operators
4,879
4,005
Payables due to employees
Other tax payables
Payables due to social security institutions
Contingent consideration
Payables for put options granted to minority shareholders
Current accrued expenses and deferred income
Payables for acquisition of equity investments
Liabilities for construction contracts
459
990
216
36
793
294
-
347
496
887
216
46
789
285
33
317
Other
Total
1,641
11,222
2,154
10,827
(32)
874
(37)
103
-
(10)
4
9
(33)
30
(513)
395
-2.0%
21.8%
-7.5%
11.6%
-
-21.7%
0.5%
3.2%
-
9.5%
-23.8%
3.6%
“Payables due to customers” include €1,066 million (€1,096
rica. The increase in the item is mainly attributable to the
million at December 31, 2014) in security deposits related to
change in the methods for determining certain rate compo-
amounts received from customers in Italy as part of electri-
nents (A and UC) to be paid by Enel Distribuzione.
city and gas supply contracts. Following the finalization of
“Contingent consideration” regards a number of investees
the contract, deposits for electricity sales, the use of which
held by the Group in North America whose fair value was
is not restricted in any way, are classified as current liabilities
determined on the basis of the terms and conditions of the
given that the Company does not have an unconditional right
contractual agreements between the parties.
to defer repayment beyond 12 months.
The item “Payables for put options granted to minority sha-
“Payables due to equalization funds, market operators and
reholders” at December 31, 2015 includes the liability in
energy services operators“ include payables arising from
respect of Enel Distributie Muntenia and Enel Energie Mun-
the application of equalization mechanisms to electricity
tenia in the total amount of €778 million (unchanged on De-
purchases on the Italian market amounting to €3,439 million
cember 31, 2014).
(€2,449 million at December 31, 2014) and on the Spanish
In 2014, “payables for acquisition of equity investments” re-
market amounting to €1,392 million (€1,556 million at De-
garded the residual amounts to pay for the acquisition of a
cember 31, 2014) while the remainder regards Latin Ame-
number of companies in North America.
41. Financial instruments
This note provides disclosures necessary for users to assess the significance of financial instruments for the Company’s
financial position and performance.
252
Annual Report 2015 41.1 Financial assets by category
The following table reports the carrying amount for each ca-
hedging derivatives and derivatives measured at fair value
tegory of financial asset provided for under IAS 39, broken
through profit or loss separately.
down into current and non-current financial assets, showing
Millions of euro
Non-current
Current
Notes
at Dec. 31, 2015
at Dec. 31, 2014 at Dec. 31, 2015 at Dec. 31, 2014
Loans and receivables
Available-for-sale financial assets
Financial assets held to maturity
Financial assets at fair value through profit or loss
Financial assets designated upon initial recognition (fair
value option)
Derivative financial assets at FVTPL
Total financial assets at fair value through profit or
loss
Derivative financial assets designated as hedging
instruments
Fair value hedge derivatives
Cash flow hedge derivatives
Total derivative financial assets designated as
hedging instruments
TOTAL
41.1.1
41.1.2
41.1.3
41.1.4
41.1.5
41.1.5
41.1.5
2,173
868
117
45
13
58
46
2,284
2,330
5,546
2,522
25,676
28,830
882
139
40
5
45
55
1,275
1,330
4,918
-
1
-
140
-
-
4,466
4,930
4,466
4,930
-
607
607
-
570
570
30,750
34,470
For more information on fair value measurement, please see note 45 “Assets measured at fair value”.
41.1.1 Loans and receivables
The following table shows loans and receivables by nature, broken down into current and non-current financial assets.
Millions of euro
Non-current
Current
Notes
at Dec. 31, 2015
at Dec. 31, 2014
Notes
at Dec. 31, 2015 at Dec. 31, 2014
Cash and cash equivalents
Trade receivables
Short-term portion of long-term financial
receivables
Receivables for factoring
Cash collateral
Other financial receivables
Total
30
27
28
28
28
24
-
-
-
-
-
-
-
-
-
-
2,173
2,173
2,522
2,522
30
27
28
28
28
28
10,639
12,797
769
147
1,020
304
25,676
13,088
12,022
1,566
177
1,654
323
28,830
Trade receivables from customers at December 31, 2015
rment losses, which amounted to €2,085 million at the end
amounted to €12,797 million (€12,022 million at December
of the year, up from the opening balance of €1,662 million.
31, 2014) and are recognized net of allowances for impai-
253
Consolidated financial statementsAnnual Report 2015 The table below shows impairment losses on trade receivables:
Millions of euro
Trade receivables
Gross value
Allowances for impairment
Net value
The table below shows changes in these allowances during the year.
Millions of euro
Opening balance at Jan. 1, 2014
Charge for the year
Utilized
Unused amounts reversed
Other changes
Closing balance at Dec. 31, 2014
Opening balance at Jan. 1, 2015
Charge for the year
Utilized
Unused amounts reversed
Other changes
Closing balance at Dec. 31, 2015
at Dec. 31, 2015
at Dec. 31, 2014
14,882
(2,085)
12,797
13,684
(1,662)
12,022
1,472
864
(529)
(120)
(25)
1,662
1,662
992
(546)
(178)
155
2,085
Note 42 “Risk management” provides additional information on the ageing of receivables past due but not impaired.
41.1.2 Available-for-sale financial assets
The following table shows available-for-sale financial assets by nature, broken down into current and non-current financial
assets.
Millions of euro
Non-current
Current
Notes
at Dec. 31, 2015
at Dec. 31, 2014
Notes at Dec. 31, 2015 at Dec. 31, 2014
Equity investments in other companies
Available-for-sale securities
Service concession arrangements
Total
24
28.1
24
237
-
631
868
213
24
-
28.1
669
882
-
-
-
-
Changes in financial assets available for sale
Millions of euro
Opening balance at Jan. 1, 2015
Increases
Decreases
Changes in fair value through OCI
Reclassifications
Other changes
Closing balance at Dec. 31, 2015
254
Non-current
882
129
(51)
16
85
(193)
868
-
140
-
140
Current
140
-
(140)
-
-
-
-
Annual Report 2015 41.1.3 Financial assets held to maturity
At December 31, 2015 financial assets held to maturity
the previous year. The item reports non-current securities
amounted to €117 million, down €22 million compared with
held by Enel Insurance.
41.1.4 Financial assets at fair value through profit or loss
The following table shows financial assets at fair value through profit or loss by nature, broken down into current and non-
current financial assets.
Millions of euro
Non-current
Current
Notes
at Dec. 31, 2015
at Dec. 31, 2014
Notes at Dec. 31, 2015 at Dec. 31, 2014
Derivatives at FVTPL
41.4
Financial investments in funds
Total financial assets designated upon initial
recognition (fair value option)
TOTAL
13
45
45
58
5
40
40
45
41.4
4,466
4,930
-
-
-
-
4,466
4,930
41.1.5 Derivative financial assets
For more information on derivative financial assets, please see note 44 “Derivatives and hedge accounting”.
255
Consolidated financial statementsAnnual Report 2015 41.2 Financial liabilities by category
The following table shows the carrying amount for each ca-
ing hedging derivatives and derivatives measured at fair va-
tegory of financial liability provided for under IAS 39, broken
lue through profit or loss separately.
down into current and non-current financial liabilities, show-
Millions of euro
Non-current
Current
Notes
at Dec. 31, 2015 at Dec. 31, 2014
at Dec. 31, 2015 at Dec. 31, 2014
Financial liabilities measured at amortized cost
41.2.1
44,872
48,655
19,663
21,796
Financial liabilities at fair value through profit or loss
Derivative financial liabilities at FVTPL
41.4
Total financial liabilities at fair value through profit
or loss
Derivative financial liabilities designated as hedging
instruments
Fair value hedge derivatives
Cash flow hedge derivatives
41.4
41.4
Total derivative financial liabilities designated as
hedging instruments
TOTAL
41
41
-
1,477
1,477
46,390
35
35
-
2,406
2,406
51,096
4,734
4,971
4,734
4,971
-
775
775
-
470
470
25,172
27,237
For more information on fair value measurement, please see note 46 “Liabilities measured at fair value”.
41.2.1 Financial liabilities measured at amortized cost
The following table shows financial liabilities at amortized cost by nature, broken down into current and non-current financial
Non-current
Current
Notes
at Dec. 31, 2015
at Dec. 31, 2014
Notes at Dec. 31, 2015 at Dec. 31, 2014
41
41
37
44,872
48,655
-
-
-
-
44,872
48,655
41
41
37
5,733
2,155
11,775
19,663
5,125
3,252
13,419
21,796
liabilities.
Millions of euro
Long-term borrowings
Short-term borrowings
Trade payables
Total
256
Annual Report 2015 41.3 Borrowings
41.3.1 Long-term borrowings (including the current portion due within 12 months) -
€50,605 million
The following table reports the carrying amount and fair va-
associated market data at the reporting date, including the
lue for each category of debt, including the portion falling
credit spreads of Enel SpA.
due within 12 months. For listed debt instruments, the fair
value is given by official prices, while for unlisted debt instru-
The table reports the situation of long-term borrowings and
ments fair value is determined using valuation techniques
repayment schedules at December 31, 2015, broken down
appropriate for each category of financial instrument and the
by type of borrowing and interest rate.
Millions of euro
Nominal
value
Carrying
amount
Current
portion
Portion
due in
more than
12 months
Fair
value
Nominal
value
Carrying
amount
Current
portion
Portion
due in
more
than 12
months
Changes
in carrying
amount
Fair
value
at Dec. 31, 2015
at Dec. 31, 2014
Bonds:
- listed, fixed rate
30,250
29,809
3,351
26,458
34,897
32,155
31,897
2,561
29,336
37,847
(2,088)
- listed, floating rate
- unlisted, fixed rate
4,098
5,479
4,076
5,436
1,155
2,921
4,190
5,722
5,692
1,432
4,260
5,982
(1,616)
-
5,436
6,186
4,926
4,885
-
4,885
5,808
551
- unlisted, floating
rate
1,236
1,236
64
1,172
1,193
1,331
1,331
63
1,268
1,263
(95)
Total bonds
41,063
40,557
4,570
35,987
46,466
44,134
43,805
4,056
39,749
50,900
(3,248)
1,169
6,555
1,147
6,529
137
707
1,010
1,256
945
926
47
879
5,822
6,812
6,861
6,839
708
6,131
1,170
7,026
221
(310)
31
31
-
31
31
81
81
69
12
70
(50)
7,755
7,707
844
6,863
8,099
7,887
7,846
824
7,022
8,266
(139)
Bank borrowings:
- fixed rate
- floating rate
- use of revolving
credit lines
Total bank
borrowings
Non-bank
borrowings:
- fixed rate
- floating rate
329
329
2,012
2,012
250
69
1,762
2,012
1,723
1,723
186
1,537
1,824
260
341
406
406
59
347
420
289
(77)
Total non-bank
borrowings
Total fixed-rate
borrowings
Total floating-rate
borrowings
2,341
2,341
319
2,022
2,353
2,129
2,129
245
1,884
2,244
212
38,910
38,404
3,738
34,666
44,351
39,749
39,431
2,794
36,637
46,649
(1,027)
12,249
12,201
1,995
10,206
12,567
14,401
14,349
2,331
12,018
14,761
(2,148)
TOTAL
51,159
50,605
5,733
44,872
56,918
54,150
53,780
5,125
48,655
61,410
(3,175)
The balance for bonds regards, net of €808 million, the
The table below reports long-term financial debt by currency
unlisted floating-rate “Special series of bonds reserved for
and interest rate.
employees 1994-2019”, which the Parent Company holds in
portfolio, while Enel Insurance holds bonds issued by Enel
SpA totaling €15 million.
257
Consolidated financial statementsAnnual Report 2015 Long-term financial debt by currency and interest rate
Millions of euro
Carrying amount
Nominal value
Carrying amount
Nominal value
Current average
nominal interest
rate
Current effective
interest rate
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
Euro
US dollar
Pound sterling
Colombian peso
Brazilian real
Swiss franc
Chilean peso/UF
Peruvian sol
Russian ruble
Japanese yen
Other currencies
Total non-euro currencies
TOTAL
31,059
31,433
35,221
35,424
9,552
5,775
1,358
875
534
445
410
124
240
233
19,546
50,605
9,636
5,845
1,358
880
535
456
410
124
240
242
19,726
51,159
8,485
5,437
1,663
1,149
606
458
363
69
237
92
18,559
53,780
8,559
5,508
1,663
1,157
607
470
363
69
238
92
18,726
54,150
3.8%
6.3%
6.1%
9.5%
14.8%
3.1%
10.4%
6.3%
12.1%
2.4%
4.1%
6.6%
6.2%
9.5%
15.1%
3.1%
12.6%
6.3%
12.1%
2.5%
Long-term financial debt denominated in currencies other
panies operating in the renewable energy sector in the Uni-
than the euro increased by €987 million. The change is lar-
ted States and Latin America, as well as adverse exchange
gely attributable to new borrowing in US dollars by the com-
differences registered during the year.
Change in the nominal value of long-term debt
Millions of euro
value Repayments
Nominal
Change in
own bonds
Change in
scope of
consolidation
Exchange
offer
New
financing
Exchange
differences
at Dec. 31,
2014
Reclassification
from/to assets/
(liabilities) held
for sale
Nominal
value
at Dec. 31,
2015
Bonds
44,134
(4,065)
(31)
Bank borrowings
Other borrowings
7,887
2,129
(1,035)
(372)
-
-
Total financial debt
54,150
(5,472)
(31)
-
55
160
215
33
-
-
172
901
401
33
1,474
820
(53)
23
790
-
-
-
-
41,063
7,755
2,341
51,159
Compared with December 31, 2014, the nominal value of
million and other borrowings for €372 million.
long-term debt at December 31, 2015 decreased by €2,991
million, the net effect of €5,472 million in repayments,
More specifically, the main bonds maturing in 2015 included:
€1,474 million in new borrowings, €790 million in exchan-
> €1,000 million in respect of a fixed-rate bond issued by
ge losses and €215 million due to the change in scope of
Enel SpA, maturing in January 2015;
consolidation. The latter development essentially regarded
> €1,300 million in respect of a floating-rate bond issued by
the acquisition of a number of companies in the renewable
Enel SpA, maturing in January 2015;
generation sector in the United States that had previously
> €1,195 million in respect of a fixed-rate bond issued by
entered into tax partnership agreements.
Enel Finance International, maturing in June 2015;
> the equivalent of €333 million in respect of bonds issued
The main repayments in 2015 concerned bonds in the
by a number of Latin American companies, maturing du-
amount of €4,065 million, bank borrowings totaling €1,035
ring the course of 2015.
258
Annual Report 2015 The main repayments of bank borrowings in the year inclu-
In January 2015, following a non-binding exchange offer, the
ded the following:
subsidiary Enel Finance International carried out the repur-
> €147 million in respect of floating-rate bank loans of Ende-
chase and concomitant issue of a senior fixed-rate bond ma-
sa, of which €66 million in subsidized loans;
turing in January 2025 (the “exchange offer”). The amount
> €338 million in respect of repayments of subsidized loans
repurchased (€1,429 million) and that issued (€1,462 million)
by Enel Produzione and Enel Distribuzione;
generated a net cash inflow of €33 million. From an ac-
> the equivalent of €170 million in respect of repayments of
counting standpoint, taking account of the characteristics of
bank loans by companies in Latin America;
the instruments exchanged and the quantitative limits set by
> the equivalent of €267 million in respect of repayments of
the applicable accounting standard, the exchange offer did
loans by companies belonging to the Enel Green Power
not give rise to the extinguishment of the pre-existing finan-
Group;
cial liability. As the non-binding exchange offer was subscri-
> the equivalent of €104 million in respect of loans of Enel
bed by only part of the original bondholders, the previous is-
Russia.
sue remains in circulation on the market in the total notional
amount of €4,114 million, maturing between 2016 and 2021.
The main repayments of non-bank borrowings in the year
The main new borrowing carried out in 2015 involved bonds
included the following:
in the amount of €172 million, bank borrowings of €901 mil-
> the equivalent of €166 million in respect of loans in Latin
lion and other borrowings totaling €401 million.
America;
The table below shows the main characteristics of financial
> the equivalent of €124 million in respect of loans of Enel
transactions carried out in 2015.
Green Power North America.
259
Consolidated financial statementsAnnual Report 2015 Bonds:
Local bond
Local bond
Local bond
Total bonds
Bank borrowings:
Total bank borrowings
Non-bank borrowings:
Total non-bank borrowings
Issuer/grantor
Issue/grant
date
Amount in
millions of
euro
Currency
Interest rate
Interest rate
type
Maturity
Edelnor
07/16/2015
Enel Russia
06/04/2015
Enel Russia
10/02/2015
Enel Green Power
Chile
Enel Green Power
RSA
Enel Green Power
RSA
Enel Green Power
RSA
01/29/2015
04/01/2015
04/01/2015
08/27/2015
Endesa
09/25/2015
Enel Green Power
North America
Enel Green Power
North America
12/23/2015
12/18/2015
19
62
62
143
69
11
35
30
300
445
80
190
270
PEN
RUR
RUR
6.12%
Fixed rate
07/16/2019
12.10%
Fixed rate
05/31/2018
12.10%
Fixed rate
09/29/2018
USD LIBOR 6M
+ 265 bp
USD
JIBAR 6M +
125 bp
JIBAR 6M +
270 bp
ZAR
ZAR
EURIBOR 6M +
115 bp
EUR
EURIBOR 3M +
46.4 bp
EUR
Floating rate
12/03/2021
Floating rate
06/30/2032
Floating rate
06/30/2022
Floating rate
06/30/2029
Floating rate
09/25/2027
USD
7.50%
Fixed rate
12/23/2025
USD
7.57%
Fixed rate
12/18/2025
The main financing contracts finalized in 2015 include:
sa Capital SA and International Endesa BV can be summari-
> on February 11, Enel SpA renegotiated the forward star-
zed as follows:
ting revolving credit facility of about €9.4 billion obtained
> negative pledge clauses under which the issuer and the
on February 11, 2013, reducing its cost and extending its
guarantor may not establish or maintain mortgages, liens
term until 2020 from its original maturity of April 2018.
or other encumbrances on all or part of its assets or reve-
The facility was undrawn at December 31, 2015;
nue to secure certain financial liabilities, unless the same
> on July 16, 2015, a €450 million credit facility was agreed
encumbrances are extended equally or pro rata to the
between Enel SpA and UniCredit SpA with a term of 60
bonds in question;
months, replacing the €400 million facility terminating
> pari passu clauses, under which the bonds and the asso-
in July 2016. The facility was undrawn at December 31,
ciated security constitute a direct, unconditional and un-
2015;
secured obligation of the issuer and the guarantor and are
> during the year, Endesa renegotiated part of its credit li-
issued without preferential rights among them and have
nes for a total of €300 million.
at least the same seniority as other present and future
unsubordinated and unsecured bonds of the issuer and
The Group’s main long-term financial liabilities are governed
the guarantor;
by covenants that are commonly adopted in international
> cross-default clauses, under which the occurrence of a
business practice. These liabilities primarily regard the bond
default event in respect of a specified financial liability
issues carried out within the framework of the Global Me-
(above a threshold level) of the issuer, the guarantor or,
dium-Term Notes Program, issues of subordinated uncon-
in some cases, “significant” subsidiaries constitutes a
vertible hybrid bonds and loans granted by banks and other
default in respect of the liabilities in question, which be-
financial institutions (including the European Investment
come immediately repayable.
Bank and Cassa Depositi e Prestiti SpA).
The main covenants covering Enel’s hybrid bonds can be
The main covenants regarding bond issues carried out within
summarized as follows:
the framework of the Global Medium-Term Notes Program
> subordination clauses, under which each hybrid bond is su-
of (i) Enel and Enel Finance International NV and of (ii) Ende-
bordinate to all other bonds issued by the company and
260
Annual Report 2015 has the same seniority with all other hybrid financial in-
> cross-default clauses, under which the occurrence of a
struments issued, being senior only to equity instruments;
default event in respect of a specified financial liability
> prohibition on mergers with other companies, the sale or
(above a threshold level) of the issuer or, in some cases,
leasing of all or a substantial part of the company’s assets
the guarantor constitutes a default in respect of the liabi-
to another company, unless the latter succeeds in all obli-
lities in question, which become immediately repayable.
gations of the issuer.
The main covenants envisaged in the loan contracts of Enel
All the financial borrowings considered specify “events of
and Enel Finance International NV and the other Group com-
default” typical of international business practice, such as,
panies can be summarized as follows:
for example, insolvency, bankruptcy proceedings or the en-
> negative pledge clauses, under which the borrower and,
tity ceases trading.
in some cases, the guarantor are subject to limitations on
In some cases the covenants are also binding for the signi-
the establishment of mortgages, liens or other encum-
ficant subsidiaries of the obligated parties or for their subsi-
brances on all or part of their respective assets, with the
diaries.
exception of expressly permitted encumbrances;
In addition, the guarantees issued by Enel in the interest
> disposals clauses, under which the borrower and, in some
of Enel Distribuzione for certain loans to Enel Distribuzione
cases, the guarantor may not dispose of their assets or ope-
from Cassa Depositi e Prestiti require that at the end of each
rations, with the exception of expressly permitted disposals;
six-month measurement period Enel’s net consolidated fi-
> pari passu clauses, under which the payment underta-
nancial debt shall not exceed 4.5 times annual consolidated
kings of the borrower have the same seniority as its other
EBITDA.
unsecured and unsubordinated payment obligations;
Furthermore, many of these agreements also contain
> change of control clauses, under which the borrower and,
cross-acceleration clauses that are triggered by specific cir-
in some cases, the guarantor could be required to rene-
cumstances, certain government actions, insolvency or judi-
gotiate the terms and conditions of the financing or make
cial expropriation of assets.
compulsory early repayment of the loans granted;
In addition to the foregoing, a number of loans provide for
> rating clauses, which provide for the borrower or the gua-
early repayment in the case of a change of control over En-
rantor to maintain their rating above a certain specified
desa or the subsidiaries.
level;
261
Consolidated financial statementsAnnual Report 2015 The following table reports the impact on gross long-term debt of hedges established to mitigate exchange risk.
Long-term financial debt by hedged currency
Millions of euro
at Dec. 31, 2015
at Dec. 31, 2014
Initial debt structure
Impact of hedge
Debt structure after hedging
Initial debt structure
Impact of hedge
Debt structure after hedging
Carrying amount
Nominal amount
35,221
35,424
3,1%
8,485
5,437
1,663
1,149
606
458
363
69
237
92
18,559
53,780
8,559
5,508
1,663
1,157
607
470
363
69
238
92
18,726
54,150
%
65.4%
15.8%
10.2%
3.1%
2.1%
1.1%
0.9%
0.7%
0.1%
0.4%
0.2%
34.6%
100.0%
11,787
(5,972)
(5,508)
(607)
206
332
(238)
-
-
-
-
-
(11,787)
47,211
2,587
1,663
1,157
-
-
-
676
363
401
92
6,939
54,150
87.2%
4.8%
-
-
-
3.1%
2.1%
1.2%
0.7%
0.7%
0.2%
12.8%
100.0%
Euro
US dollar
Pound sterling
Colombian peso
Brazilian real
Swiss franc
Chilean peso/UF
Peruvian sol
Russian ruble
Japanese yen
Other currencies
Total non-euro
currencies
TOTAL
Carrying amount Nominal amount
31,059
31,433
9,552
5,775
1,358
875
534
445
410
124
240
233
9,636
5,845
1,358
880
535
456
410
124
240
242
%
61.4%
18.8%
11.4%
2.7%
1.7%
1.0%
0.9%
0.8%
0.2%
0.5%
0.5%
12,770
(6,660)
(5,845)
57
28
(535)
230
(58)
235
(240)
18
44,203
2,976
-
1,415
908
-
686
352
359
-
260
86.4%
5.8%
-
2.8%
1.8%
-
1.3%
0.7%
0.7%
-
0.5%
19,546
50,605
19,726
51,159
38.6%
100.0%
(12,770)
-
6,956
51,159
13.6%
100.0%
The amount of floating-rate debt that is not hedged against
income statement (raising borrowing costs) in the event of
interest rate risk is the main risk factor that could impact the
an increase in market interest rates.
Millions of euro
2015
2014
Floating rate
Fixed rate
Total
Pre-hedge
% Post-hedge
% Pre-hedge
% Post-hedge
%
14,405
38,910
53,315
27.0%
11,055
20.7%
17,656
30.8%
13,396
23.3%
73.0%
42,260
79.3%
39,749
69.2%
44,009
76.7%
53,315
57,405
57,405
At December 31, 2015, 27% of financial debt was floating
ineligible for hedge accounting, 79% of net financial debt
rate (31% at December 31, 2014). Taking account of hedges
was hedged (77% hedged at December 31, 2014).
of interest rates considered effective pursuant to the IFRS–
EU, 21% of net financial debt (23% at December 31, 2014)
These results are in line with the limits established in the
was exposed to interest rate risk. Including interest rate de-
risk management policy.
rivatives treated as hedges for management purposes but
262
Annual Report 2015 The following table reports the impact on gross long-term debt of hedges established to mitigate exchange risk.
Long-term financial debt by hedged currency
Euro
US dollar
Pound sterling
Colombian peso
Brazilian real
Swiss franc
Chilean peso/UF
Peruvian sol
Russian ruble
Japanese yen
Other currencies
Total non-euro
currencies
TOTAL
Carrying amount Nominal amount
31,059
31,433
9,552
5,775
1,358
875
534
445
410
124
240
233
9,636
5,845
1,358
880
535
456
410
124
240
242
%
61.4%
18.8%
11.4%
2.7%
1.7%
1.0%
0.9%
0.8%
0.2%
0.5%
0.5%
12,770
(6,660)
(5,845)
57
28
(535)
230
(58)
235
(240)
18
19,546
50,605
19,726
51,159
38.6%
100.0%
(12,770)
-
44,203
2,976
1,415
908
-
-
-
686
352
359
260
6,956
51,159
86.4%
5.8%
-
-
-
2.8%
1.8%
1.3%
0.7%
0.7%
0.5%
13.6%
100.0%
Millions of euro
at Dec. 31, 2015
at Dec. 31, 2014
Initial debt structure
Impact of hedge
Debt structure after hedging
Initial debt structure
Impact of hedge
Debt structure after hedging
3,1%
Carrying amount
Nominal amount
35,221
35,424
8,485
5,437
1,663
1,149
606
458
363
69
237
92
18,559
53,780
8,559
5,508
1,663
1,157
607
470
363
69
238
92
18,726
54,150
%
65.4%
15.8%
10.2%
3.1%
2.1%
1.1%
0.9%
0.7%
0.1%
0.4%
0.2%
34.6%
100.0%
11,787
(5,972)
(5,508)
-
-
(607)
206
-
332
(238)
-
(11,787)
-
47,211
2,587
-
1,663
1,157
-
676
363
401
-
92
87.2%
4.8%
-
3.1%
2.1%
-
1.2%
0.7%
0.7%
-
0.2%
6,939
54,150
12.8%
100.0%
263
Consolidated financial statementsAnnual Report 2015 41.3.2 Short-term borrowings - €2,155 million
At December 31, 2015 short-term borrowings amounted to €2,155 million, a decrease of €1,097 million on December 31,
2014. They break down as follows.
Millions of euro
Short-term bank borrowings
Commercial paper
Cash collateral and other financing on derivatives
Other short-term borrowings
Short-term borrowings
at Dec. 31, 2015
at Dec. 31, 2014
180
213
1,698
64
2,155
30
2,599
457
166
3,252
Change
150
(2,386)
1,241
(102)
(1,097)
Short-term bank borrowings amounted to €180 million. The
gram of International Endesa BV and the $400 million (equal
payables represented by commercial paper relate to issues
to €367 million) program of Enersis.
outstanding at the end of December 2015 in the context of
At December 31, 2015 issues under these programs totaled
the €6,000 million program launched in November 2005 by
€213 million, of which €96 million pertaining to Enel Finance
Enel Finance International and guaranteed by Enel SpA, which
International and €117 million to International Endesa BV.
was renewed in April 2010, as well as the €3,000 million pro-
41.4 Derivative financial liabilities
For more information on derivative financial liabilities, please see note 44 “Derivatives and hedge accounting”.
41.5 Net gains and losses
The following table shows net gains and losses by category of financial instruments, excluding derivatives.
Millions of euro
Available-for-sale financial assets measured at fair value
Available-for-sale financial assets measured at amortized cost
Financial assets held to maturity
Loans and receivables
Financial assets at FVTPL
Financial assets held for trading
Financial assets designated upon initial recognition (fair value option)
Total financial assets at FVTPL
Financial liabilities measured at amortized cost
Financial liabilities at FVTPL
Financial liabilities held for trading
Financial liabilities designated upon initial recognition (fair value option)
Total financial liabilities at FVTPL
2015
Net gains/(losses)
Of which impairment/
reversal of impairment
-
8
7
149
-
5
5
(3,900)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
For more details on net gains and losses on derivatives, please see note 10 “Net financial income/(expense) from derivatives”.
264
Annual Report 2015 42. Risk management
Financial risk management objectives and policies
As part of its operations, the Enel Group is exposed to a
Group level and at the level of individual Regions/Countri-
variety of financial risks, notably market risks (including inte-
es/global business lines, which define the roles and re-
rest rate risk, exchange risk and commodity risk), credit risk
sponsibilities for those involved in managing, monitoring
and liquidity risk.
and controlling risks, ensuring the organizational separa-
tion of units involved in managing the Group’s business
The Group’s governance arrangements for financial risk en-
and those responsible for managing risk;
visage:
> the specification of operational limits at both the Group le-
> specific internal committees, formed of members of the
vel and at the level of individual Regions/Countries/global
Group’s top management and chaired by the CEO, which
business lines for the various types of risk. These limits
are responsible for strategic policy-making and oversight
are monitored periodically by the risk management units.
of risk management;
> the establishment of specific policies set at both the
Market risks
Market risk is the risk that the expected cash flows or the
euro of performance and financial aggregates denominated
fair value of financial and non-financial assets and liabilities
in foreign currencies, such as costs, revenue, assets and
could change owing to changes in market prices.
liabilities, as well as the consolidation values of equity in-
Market risks are essentially composed of interest rate risk,
vestments denominated in currencies other than the euro
exchange risk and commodity price risk.
(translation risk). As with interest rates, changes in exchange
rates can cause variations in the value of financial assets and
Interest rate risk and exchange risk are primarily generated
liabilities measured at fair value.
by the presence of financial instruments.
The main financial liabilities held by the Company include
The Group’s policies for managing market risks provide for
bonds, bank borrowings, other borrowings, commercial pa-
the mitigation of the effects on performance of changes in
per, derivatives, cash collateral for derivatives transactions,
interest rates and exchange rates with the exclusion of tran-
liabilities for construction contracts and trade payables.
slation risk. This objective is achieved both at the source of
The main purpose of those financial instruments is to finan-
the risk, through the strategic diversification of the nature
ce the operations of the Group.
of financial assets and liabilities, and by modifying the risk
The main financial assets held by the Group include financial
profile of specific exposures with derivatives entered into on
receivables, factoring receivables, derivatives, cash collate-
over-the-counter (OTC) markets.
ral for derivatives transactions, cash and cash equivalents,
receivables for construction contracts and trade receivables.
The risk of fluctuations in commodity prices is generated
For more details, please see note 41 “Financial instruments”.
by the volatility of those prices and existing structural cor-
The sources of exposure to interest rate risk and exchange
relations between them, which creates uncertainty about
risk did not change with respect to the previous year.
the margin on transactions in fuels and energy. Price deve-
lopments are observed and analyzed in order to develop the
The nature of the financial risks to which the Group is ex-
Group’s industrial, financial and commercial strategies and
posed is such that changes in interest rates can cause an
policies.
increase in net financial expense or adverse changes in the
In order to contain the effects of such fluctuations and stabi-
value of assets/liabilities measured at fair value.
lize margins, Enel develops, in accordance with the Group’s
The Group is also exposed to the risk that changes in the
policies and risk governance limits, strategies that impact the
exchange rates between the euro and the main foreign
various stages of the industrial process associated with the
currencies could have an adverse impact on the value in
production and sale of electricity and gas, such as advance
265
Consolidated financial statementsAnnual Report 2015 sourcing and hedging, and plans and techniques for hedging
company designated to steer, monitor and integrate global
financial risks with derivatives. The Group companies deve-
performance. In order to manage and control market risks
lop strategies for hedging the price risk arising from trading
associated with energy commodities, strengthening an in-
in commodities and, using financial instruments, reduce or
tegrated vision of our business and a geographical aware-
eliminate market risk, sterilizing the variable components of
ness of sales and trading operations is consistent with the
price. If authorized, they can also engage in proprietary tra-
global environment in which the Group operates, creating
ding in the energy commodities used by the Group in order
opportunities for improvement in both maximizing margins
to monitor and enhance their understanding of the most re-
and governing risks.
levant markets.
As part of its governance of market risks, the Company re-
The organizational structure provides for a single entity to
gularly monitors the size of the OTC derivatives portfolio
operate on behalf of the entire Group in sourcing fuels and
in relation to the threshold values set by regulators for the
selling electricity and gas on wholesale markets, as well as
activation of clearing obligations (EMIR - European Market
centralizing trading with the direct control of the units invol-
Infrastructure Regulation 648/2012 of the European Parlia-
ved in that business, which as they also operate at the local
ment). During 2015, no overshoot of those threshold values
level can maintain effective relationships with the markets.
was detected.
The global business line cooperates with units of the holding
Interest rate risk
Interest rate risk is the risk that the fair value or expected
sufficiently liquid. For the purpose of EMIR compliance, in
cash flows of a financial instrument will fluctuate because
order to test the actual effectiveness of the hedging tech-
of changes in market interest rates.
niques adopted, the Group subjects its hedge portfolios to
The main source of interest rate risk for the Enel Group is
periodic statistical assessment.
the presence of financial instruments. It manifests itself
primarily as a change in the flows associated with interest
Using interest rate swaps, the Enel Group agrees with the
payments on floating-rate financial liabilities, a change in
counterparty to periodically exchange floating-rate interest
financial terms and conditions in negotiating new debt in-
flows with fixed-rate flows, both calculated on the same
struments or as an adverse change in the value of financial
notional principal amount.
assets/liabilities measured at fair value, which are typically
Floating-to-fixed interest rate swaps transform floating-rate
fixed-rate debt instruments.
financial liabilities into fixed-rate liabilities, thereby neutra-
For more information, please see note 41 “Financial instru-
lizing the exposure of cash flows to changes in interest
ments”.
rates.
Fixed-to-floating interest rate swaps transform fixed-rate fi-
The Enel Group manages interest rate risk through the de-
nancial liabilities into floating-rate liabilities, thereby neutra-
finition of an optimal financial structure, with the dual goal
lizing the exposure of their fair value to changes in interest
of stabilizing borrowing costs and containing the cost of
rates.
funds.
Floating-to-floating interest rate swaps permit the exchan-
This goal is pursued through the strategic diversification of
ge of floating-rate interest flows based on different indexes.
the portfolio of financial liabilities by contract type, maturity
Some structured borrowings have multi-stage interest
and interest rate, and modifying the risk profile of speci-
flows hedged by interest rate swaps that at the reporting
fic exposures using OTC derivatives, mainly interest rate
date, and for a limited time, provide for the exchange of
swaps and interest rate options. The term of such contracts
fixed-rate interest flows.
does not exceed the maturity of the underlying financial lia-
bility, so that any change in the fair value and/or cash flows
Interest rate options involve the exchange of interest dif-
of such contracts is offset by a corresponding change in the
ferences calculated on a notional principal amount once
fair value and/or cash flows of the hedged position.
certain thresholds (strike prices) are reached. These th-
Proxy hedging techniques may be used in a number of re-
resholds specify the effective maximum rate (cap) or the
sidual circumstances, when the hedging instruments for
minimum rate (floor) on the debt as a result of the hedge.
the risk factors are not available on the market or are not
Hedging strategies can also make use of combinations of
266
Annual Report 2015 options (collars) that establish the minimum and maximum
options are also considered most appropriate in periods of
rates at the same time. In this case, the strike prices are
uncertainty about future interest rate developments becau-
normally set so that no premium is paid on the contract
se they make it possible to benefit from any decrease in
(zero cost collars).
interest rates.
Such contracts are normally used when the fixed interest
The following table reports the notional amount of interest
rate that can be obtained in an interest rate swap is consi-
rate derivatives at December 31, 2015 and December 31,
dered too high with respect to Enel’s expectations for fu-
2014 broken down by type of contract.
ture interest rate developments. In addition, interest rate
Millions of euro
Notional amount
Floating-to-fixed interest rate swaps
Fixed-to-floating interest rate swaps
Fixed-to-fixed interest rate swaps
Floating-to-floating interest rate swaps
Interest rate options
Total
2015
10,910
853
-
180
50
11,993
2014
5,043
889
100
180
50
6,262
For more details on interest rate derivatives, please see note
financial expense associated with unhedged gross debt.
44 “Derivatives and hedge accounting”.
These scenarios are represented by parallel increases and
Interest rate risk sensitivity analysis
There were no changes in the methods and assumptions
The Group analyses the sensitivity of its exposure by estima-
used in the sensitivity analysis compared with the previous
decreases in the yield curve as at the reporting date.
ting the effects of a change in interest rates on the portfolio
year.
of financial instruments.
More specifically, sensitivity analysis measures the potential
With all other variables held constant, the Group’s profit be-
impact on profit or loss and on equity of market scenarios that
fore tax would be affected by a change in the level of interest
would cause a change in the fair value of derivatives or in the
rates as follows.
Millions of euro
2015
Change in financial expense on gross long-term
floating-rate debt after hedging
Change in fair value of derivatives classified as
non-hedging instruments
Change in fair value of derivatives designated
as hedging instruments
Cash flow hedges
Fair value hedges
Pre-tax impact on profit or loss
Pre-tax impact on equity
Basis points
Increase
Decrease
Increase
Decrease
25
25
25
25
28
7
-
(8)
(28)
(7)
-
8
-
-
183
-
-
-
(183)
-
267
Consolidated financial statementsAnnual Report 2015 Exchange risk
Exchange risk is the risk that the fair value or future cash
of the underlying financial liability, so that any change in the
flows of a financial instrument will fluctuate because of
fair value and/or cash flows of such contracts offsets the
changes in exchange rates.
corresponding change in the fair value and/or cash flows of
For the companies of the Enel Group, the main source of
the hedged position.
exchange risk is the presence of financial instruments and
Cross currency interest rate swaps are used to transform a
cash flows denominated in a currency other than its cur-
long-term financial liability in foreign currency into an equiva-
rency of account and/or functional currency.
lent liability in the currency of account or functional currency
More specifically, exchange risk is mainly generated with the
of the company holding the exposure.
following transaction categories:
Currency forwards are contracts in which the counterparties
> debt denominated in currencies other than the currency
agree to exchange principal amounts denominated in diffe-
of account or the functional currency entered into by the
rent currencies at a specified future date and exchange rate
holding company or the individual subsidiaries;
(the strike). Such contracts may call for the actual exchange
> cash flows in respect of the purchase or sale of fuel or
of the two amounts (deliverable forwards) or payment of the
electricity on international markets;
difference between the strike exchange rate and the pre-
> cash flows in respect of investments in foreign currency,
vailing exchange rate at maturity (non-deliverable forwards).
dividends from unconsolidated foreign companies or the
In the latter case, the strike rate and/or the spot rate may
purchase or sale of equity investments.
be determined as averages of the rates observed in a given
The sources of exposure to exchange risk did not change
Currency swaps are contracts in which the counterparties
with respect to the previous year.
enter into two transactions of the opposite sign at different
For more details, please see note 41 “Financial instruments”.
future dates (normally one spot, the other forward) that pro-
vide for the exchange of principal denominated in different
period.
In order to minimize this risk, the Group normally uses a
currencies.
variety of over-the-counter (OTC) derivatives such as cross
currency interest rate swaps, currency forwards and cur-
The following table reports the notional amount of transac-
rency swaps.
tions outstanding at December 31, 2015 and December 31,
The term of such contracts does not exceed the maturity
2014, broken down by type of hedged item.
Millions of euro
Notional amount
Cross currency interest rate swaps (CCIRSs) hedging debt denominated
in currencies other than the euro
Currency forwards hedging exchange risk on commodities
Currency forwards hedging future cash flows in currencies other than the euro
Currency swaps hedging commercial paper
Currency forwards hedging loans
Other currency forwards
Total
2015
15,812
4,334
4,330
-
181
11
2014
14,801
4,942
3,552
148
224
-
24,668
23,667
More specifically, these include:
purchases and sales of natural gas, purchases of fuel and
> CCIRSs with a notional amount of €15,812 million to hed-
expected cash flows in currencies other than the euro
ge the exchange risk on debt denominated in currencies
(€8,494 million at December 31, 2014);
other than the euro (€14,801 million at December 31,
> currency forwards with a total notional amount of €181
2014);
million used to hedge the exchange risk associated with
> currency forwards with a total notional amount of €8,664
loans in currencies other than the euro (€224 million at
million used to hedge the exchange risk associated with
December 31, 2014).
268
Annual Report 2015 At December 31, 2015, 39% (35% at December 31, 2014) of
Taking account of hedges of exchange risk, the percentage
Group long-term debt was denominated in currencies other
of debt not hedged against that risk amounted to 14% at
than the euro.
December 31, 2015 (13% at December 31, 2014).
Exchange risk sensitivity analysis
These scenarios are represented by the appreciation/depre-
The Group analyses the sensitivity of its exposure by estima-
ciation of the euro against all of the foreign currencies com-
ting the effects of a change in exchange rates on the portfo-
pared with the value observed as at the reporting date.
lio of financial instruments.
There were no changes in the methods and assumptions
More specifically, sensitivity analysis measures the potential
used in the sensitivity analysis compared with the previous
impact on profit or loss and equity of market scenarios that
year.
would cause a change in the fair value of derivatives or in the
With all other variables held constant, the profit before tax
financial expense associated with unhedged gross medium/
would be affected as follows:
long-term debt.
Millions of euro
Change in financial expense on gross long-term
debt denominated in currencies other than the
euro after hedging
Change in fair value of derivatives classified as
non-hedging instruments
Change in fair value of derivatives designated
as hedging instruments
Cash flow hedges
Fair value hedges
2015
Pre-tax impact on profit or loss
Pre-tax impact on equity
Exchange rate
Increase
Decrease
Increase
Decrease
10%
10%
10%
10%
-
182
-
-
-
(223)
-
-
-
-
-
-
(1,951)
2,385
-
-
269
Consolidated financial statementsAnnual Report 2015
Commodity risk
The Group is exposed to the risk of fluctuations in the price
companies expressly authorized to do so under corporate
of commodities mainly associated with the purchase of fuel
policies, consist in taking on exposures in energy commodi-
for power plants and the purchase and sale of natural gas
under indexed contracts, as well as the purchase and sale of
ties (oil products, gas, coal, CO2 certificates and electricity in
the main European countries) using financial derivatives and
electricity at variable prices (indexed bilateral contracts and
physical contracts traded on regulated and over-the-counter
sales on the electricity spot market).
markets, exploiting profit opportunities through arbitrage
The exposures on indexed contracts are quantified by bre-
transactions carried out on the basis of expected market de-
aking down the contracts that generate exposure into the
velopments.
underlying risk factors.
The commodity risk management processes established at
As regards electricity sold by the Group, Enel mainly uses fi-
the Group level are designed to constantly monitor deve-
xed-price contracts in the form of bilateral physical contracts
lopments in risk over time and to determine whether the
and financial contracts (e.g. contracts for differences, VPP
risk levels, as observed for specific analytical dimensions
contracts, etc.) in which differences are paid to the counter-
(for example, geographical areas, organizational structures,
party if the market electricity price exceeds the strike price
business lines, etc.), comply with the thresholds consistent
and to Enel in the opposite case. The residual exposure in
with the risk appetite established by top management. The-
respect of the sale of energy on the spot market not hedged
se operations are conducted within the framework of formal
with such contracts is aggregated by uniform risk factors
governance rules that establish strict risk limits. Compliance
that can be managed with hedging transactions on the mar-
with the limits is verified daily by units that are independent
ket. Proxy hedging techniques may be used for the industrial
of those undertaking the transactions. Positions are moni-
portfolios when the hedging instruments for the risk factors
tored monthly, assessing the Profit at Risk, in the case of
generating the exposure are not available on the market or
industrial portfolios, and daily, calculating Value at Risk, in
are not sufficiently liquid, while portfolio hedging techniques
the case of the trading book.
can be used to assess opportunities for netting intercom-
The risk limits for Enel’s proprietary trading are set in terms
pany flows.
of Value at Risk over a 1-day time horizon and a confidence
The Group mainly uses plain vanilla derivatives for hedging
level of 95%; the sum of the limits for 2015 is equal to about
(more specifically, forwards, swaps, options on commodi-
€39 million.
ties, futures, contracts for differences).
Enel also engages in proprietary trading in order to maintain
The following table reports the notional amount of outstan-
a presence in the Group’s reference energy commodity mar-
ding transactions at December 31, 2015 and December 31,
kets. These operations, which are performed only by Group
2014, broken down by type of instrument.
Millions of euro
Notional amount
Forward and futures contracts
Swaps
Options
Embedded derivatives
Total
For more details, please see note 44 “Derivatives and hedge accounting”.
2015
30,791
5,904
340
-
37,035
2014
26,671
9,359
401
-
36,431
270
Annual Report 2015 Sensitivity analysis of commodity risk
commodity price curve of +10% and -10%.
The following table presents the results of the analysis
The impact on pre-tax profit is mainly attributable to the
of sensitivity to a reasonably possible change in the com-
change in the prices of gas and oil commodities. The im-
modity prices underlying the valuation model used in the
pact on equity is almost entirely due to changes in the pri-
scenario at the same date, with all other variables held
ces of gas and coal. The Group’s exposure to changes in
constant. The analysis assesses the impact of shifts in the
the prices of other commodities is not material.
Millions of euro
2015
Pre-tax impact on profit or loss
Pre-tax impact on equity
Commodity price
Increase
Decrease
Increase
Decrease
Change in fair value of trading derivatives on
commodities
Change in fair value of derivatives on commodities
designated as hedging instruments
10%
10%
(21)
-
27
-
-
-
135
(134)
Credit risk
The Group’s commercial, commodity and financial operations
For the credit risk generated by financial transactions, in-
expose it to credit risk, i.e. the possibility that an unexpected
cluding those in derivatives, risk is minimized by selecting
change in the creditworthiness of a counterparty could have
counterparties with high standing from among leading na-
an effect on the creditor position, in terms of insolvency (de-
tional and international financial institutions, diversifying the
fault risk) or changes in its market value (spread risk).
portfolio, entering into margin agreements that call for the
In recent years, in view of the instability and uncertainty that
exchange of cash collateral and/or using netting arrange-
have affected the financial markets and an economic crisis
ments. An internal assessment system was used again in
of global proportions, average collection times have trended
2015 to apply and monitor operational limits for credit risk,
upwards. In order to minimize credit risk, credit exposures
approved by the Group Risk Committee in respect of finan-
are managed at the Region/Country/business line level by
cial counterparties at the Region/Country/global business
different units, thereby ensuring the necessary segregation
line level and at the consolidated level.
of risk management and control activities. Monitoring the
consolidated exposure is carried out by Enel SpA.
To manage credit risk even more effectively, for a number of
In particular, the policy for managing credit and the associa-
years the Group has carried out non-recourse assignments
ted risks provides for the assessment of the creditworthi-
of receivables, which have mainly involved specific seg-
ness of the main counterparties, the adoption of risk mitiga-
ments of the commercial portfolio and, to a lesser extent,
tion tools, such as secured and unsecured guarantees and
invoiced receivables and receivables to be invoiced of com-
standardized contractual frameworks in specific business
panies operating in other segments of the electricity indust-
areas, and the analysis of credit exposures.
ry than retail sales.
In addition, at the Group level the policy provides for the use
All of the above transactions are considered non-recourse
of uniform criteria in all the main Regions/Countries/global
transactions for accounting purposes and therefore involved
business lines and at the consolidated level in measuring
the full derecognition of the corresponding assigned assets
commercial credit exposures in order to promptly identify
from the balance sheet, as the risks and rewards associated
any deterioration in the quality of outstanding receivables
with them have been transferred.
and any mitigation actions to be taken.
As regards the credit risk associated with commodity tran-
Concentration of customer credit risk
Trade receivables are generated by the Group’s operations
sactions, a uniform counterparty assessment system is
in many regions and countries (Italy, Spain, Romania, Latin
used at the Group level, with local level implementation.
America, Russia, France, North America, etc.) with a base of
Risk limits defined by the appropriate units of the Regions/
customers and counterparties that is highly diversified, whe-
Countries/global business lines have been applied and mo-
ther geographically, sectorally (industrial companies, energy
nitored.
companies, enterprises in retail trade, tourism, communica-
271
Consolidated financial statementsAnnual Report 2015 tions, government entities, etc.) or by size (large corporate,
mers or counterparties with whom it has generally granular
small and medium-sized enterprises, residential customers).
credit exposures.
Through its subsidiaries, Enel has about 60 million custo-
Financial assets past due but not impaired
Millions of euro
Impaired trade receivables
Not past due and not impaired trade receivables
Past due but not impaired trade receivables:
- less than 3 months
- from 3 months to 6 months
- from 6 months to 12 months
- from 12 months to 24 months
- more than 24 months
Total
Liquidity risk
2015
2,085
8,520
4,277
1,696
505
588
386
1,102
14,882
Liquidity risk is the risk that the Group will encounter difficul-
an appropriate level of unconditionally available resources,
ty in meeting obligations associated with financial liabilities
including liquidity and short-term deposits, available commit-
that are settled by delivering cash or another financial asset.
ted credit lines and a portfolio of highly liquid asset.
The objectives of liquidity risk management policies are:
In the long term, liquidity risk is mitigated by maintaining a
> ensuring an appropriate level of liquidity for the Group,
balanced maturity profile for our debt, access to a range of
minimizing the associated opportunity cost;
sources of funding on different markets, in different curren-
> maintaining a balanced debt structure in terms of the ma-
cies and with diverse counterparties.
turity profile and funding sources.
In the short term, liquidity risk is mitigated by maintaining
The Group holds the following undrawn lines of credit:
Millions of euro
at Dec. 31, 2015
at Dec. 31, 2014
Committed credit lines
Uncommitted credit lines
Commercial paper
Total
Expiring within one
year
Expiring beyond
one year
Expiring within one
year
Expiring beyond
one year
377
648
9,153
10,178
13,042
-
-
13,042
671
425
6,727
7,823
13,456
-
-
13,456
Committed credit lines amounted to €13,419 million at the
at 10 years in the nominal amount of €1,460 million, paying a
Group level, with €13,042 million expiring after 2016. Total avai-
coupon of 1.966%.
lable resources came to €23,220 million, of which €9,153 mil-
The transaction was part of EFI’s liability management pro-
lion in commercial paper.
gram begun in the final Quarter of 2014 in order to actively
In early 2015 Enel Finance International NV carried out an offer
For more information, please see note 41 “Financial instru-
manage maturities and the Group’s funding costs.
to exchange six euro-denominated bonds maturing between
ments” in this report.
2016 and 2021 with a new euro-denominated issue maturing
272
Annual Report 2015 Maturity analysis
The table below summarizes the maturity profile of the Group’s long-term debt.
Millions of euro
Maturing in
Bonds:
- listed, fixed rate
- listed, floating rate
- unlisted, fixed rate
- unlisted, floating rate
Total bonds
Bank borrowings:
- fixed rate
- floating rate
- use of revolving credit lines
Total bank borrowings
Non-bank borrowings:
- fixed rate
- floating rate
Total non-bank borrowings
Less than 3
months
From 3
months to 1
year
2,012
1,056
-
-
1,339
99
-
64
3,068
1,502
5
150
-
155
60
18
78
132
557
-
689
190
51
241
2017
2018
2019
2020
Beyond
2,204
324
1,376
65
3,969
129
534
1
664
209
69
278
4,922
747
-
66
5,735
345
624
30
999
191
40
231
2,194
217
1,600
282
4,293
79
608
-
687
170
34
204
2,361
14,777
112
-
27
1,521
2,460
732
2,500
19,490
66
592
-
658
192
30
222
391
3,464
-
3,855
1,000
87
1,087
24,432
TOTAL
3,301
2,432
4,911
6,965
5,184
3,380
Commitments to purchase commodities
In conducting its business, the Enel Group has entered into
The following table reports the undiscounted cash flows as-
contracts to purchase specified quantities of commodities
sociated with outstanding commitments at December 31,
at a certain future date for its own use, which qualify for the
2015.
own use exemption provided for under IAS 39.
Millions of euro
at Dec. 31, 2015
2015-2019
2020-2024
2025-2029
Beyond
Commitments to purchase commodities:
- electricity
- fuels
Total
48,733
64,114
112,847
18,383
35,301
53,684
9,730
16,631
26,361
6,835
13,785
10,722
17,557
1,460
15,245
273
Consolidated financial statementsAnnual Report 2015 43. Offsetting financial assets and financial liabilities
At December 31, 2015, the Group did not hold offset positions in assets and liabilities, as it is not the Enel Group’s policy to
settle financial assets and liabilities on a net basis.
44. Derivatives and hedge accounting
The following tables show the notional amount and the fair va-
on the basis of which cash flows are exchanged. This amount
lue of derivative financial assets and derivative financial liabilities
can be expressed as a value or a quantity (for example tons,
eligible for hedge accounting or measured a FVTPL, classified
converted into euros by multiplying the notional amount by
on the basis of the type of hedge relationship and the hedged
the agreed price). Amounts denominated in currencies other
risk, broken down into current and non-current instruments.
than the euro are converted at the end-year exchange rates
The notional amount of a derivative contract is the amount
provided by the European Central Bank.
Millions of euro
Non-current
Current
Notional amount
Fair value
Notional amount
Fair value
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
Fair value hedge
derivatives:
- on interest rates
Total
Cash flow hedge
derivatives:
- on interest rates
- on exchange rates
- on commodities
Total
Trading derivatives:
- on interest rates
- on exchange rates
- on commodities
Total
TOTAL DERIVATIVE
FINANCIAL ASSETS
868
868
883
883
7,090
13,554
37
20,681
50
102
53
205
106
9,078
702
9,886
50
121
3
174
46
46
116
2,163
5
2,284
2
5
6
13
55
55
5
1,163
107
1,275
3
2
-
5
15
15
21
21
25
2,921
1,093
4,039
-
2,064
16,488
18,552
400
2,662
2,755
5,817
15
2,094
14,827
16,936
-
-
1
280
326
607
-
63
4,403
4,466
-
-
-
244
326
570
1
157
4,772
4,930
21,754
10,943
2,343
1,335
22,606
22,774
5,073
5,500
Millions of euro
Non-current
Current
Notional amount
Fair value
Notional amount
Fair value
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
Cash flow hedge
derivatives:
- on interest rates
- on exchange rates
- on commodities
Total
Trading derivatives:
- on interest rates
- on exchange rates
- on commodities
Total
TOTAL DERIVATIVE
FINANCIAL LIABILITIES
274
3,643
1,991
187
5,821
107
140
93
340
3,635
6,415
742
10,792
107
240
20
367
459
1,006
12
1,477
16
18
7
41
554
1,627
225
2,406
21
10
4
35
95
673
2,028
2,796
100
3,223
17,056
20,379
922
341
2,075
3,338
123
2,716
15,307
18,146
2
96
677
775
65
43
2
4
464
470
75
71
4,626
4,734
4,825
4,971
6,161
11,159
1,518
2,441
23,175
21,484
5,509
5,441
Annual Report 2015 44.1 Derivatives designated as hedging instruments
Derivatives are initially recognized at fair value, at the trade
ble to a particular risk associated with an asset, a liability or
date of the contract, and are subsequently re-measured at
a highly probable transaction that could affect profit or loss.
fair value.
The effective portion of changes in the fair value of derivati-
The method for recognizing the resulting gain or loss depen-
ves that are designated and qualify as cash flow hedges is
ds on whether the derivative is designated as a hedging in-
recognized in other comprehensive income. The gain or loss
strument, and if so, on the nature of the item being hedged.
relating to the ineffective portion is recognized immediately
Hedge accounting is applied to derivatives entered into in
in the income statement.
order to reduce risks such as interest rate risk, exchange
Amounts accumulated in equity are reclassified to profit or
risk, commodity risk, credit risk and equity risk when all the
loss in the period when the hedged item affects profit or
criteria provided for under IAS 39 are met.
loss.
At the inception of the transaction, the Group documents
When a hedging instrument expires or is sold, or when a
the relationship between hedging instruments and hedged
hedge no longer meets the criteria for hedge accounting but
items, as well as its risk management objectives and stra-
the hedged item has not expired or been cancelled, any cu-
tegy. The Group also analyzes, both at hedge inception and
mulative gain or loss existing in equity at that time remains
on an ongoing systematic basis, the effectiveness of hedges
in equity and is recognized when the forecast transaction is
using prospective and retrospective tests in order to deter-
ultimately recognized in the income statement.
mine whether hedging instruments are highly effective in
When a forecast transaction is no longer expected to occur,
offsetting changes in the fair values or cash flows of hedged
the cumulative gain or loss that was reported in equity is
items.
immediately transferred to profit or loss.
Depending on the nature of the risks to which it is exposed,
the Group designates derivatives as hedging instruments in
The Group currently uses these hedge relationships to mini-
one of the following hedge relationships:
mize the volatility of profit or loss.
> cash flow hedge derivatives in respect of the risk of: (i)
changes in the cash flows associated with long-term floa-
ting-rate debt; (ii) changes in the exchange rates associa-
Fair value hedges
Fair value hedges are used to protect the Group against expo-
ted with long-term debt denominated in a currency other
sures to adverse changes in the fair value of assets, liabilities
than the currency of account or the functional currency in
or firm commitments attributable to a particular risk that could
which the company holding the financial liability operates;
affect profit or loss.
(iii) changes in the price of fuels and non-energy commo-
Changes in the fair value of derivatives that qualify and are
dities denominated in a foreign currency; (iv) changes in
designated as hedging instruments are recognized in the in-
the price of forecast electricity sales at variable prices;
come statement, together with changes in the fair value of
and (v) changes in the price of transactions in coal and
the hedged item that are attributable to the hedged risk.
petroleum commodities;
If the hedge is ineffective or no longer meets the criteria for
> fair value hedge derivatives involving the hedging of expo-
hedge accounting, the adjustment to the carrying amount of
sures to changes in the fair value of an asset, a liability or
a hedged item for which the effective interest method is used
a firm commitment attributable to a specific risk;
is amortized to profit or loss over the period to maturity.
> derivatives hedging a net investment in a foreign opera-
The Group currently makes marginal use of such hedge rela-
tion (NIFO), involving the hedging of exposures to exchan-
tionships to seize opportunities associated with general deve-
ge rate volatility associated with investments in foreign
lopments in the yield curve.
entities.
For more details on the nature and the extent of risks arising
from financial instruments to which the Company is expo-
sed, please see note 42 “Risk management”.
Cash flow hedges
Cash flow hedges are used in order to hedge the Group’s
exposure to changes in future cash flows that are attributa-
275
Consolidated financial statementsAnnual Report 2015 44.1.1 Hedge relationships by type of risk hedged
Interest rate risk
The following table shows the notional amount and the fair
transactions outstanding as at December 31, 2015 and De-
value of the hedging instruments on the interest rate risk of
cember 31, 2014, broken down by type of hedge.
Millions of euro
Hedging instrument
Interest rate swaps
Interest rate swaps
Total
Fair value
Notional amount
Fair value Notional amount
Hedged item
at Dec. 31, 2015
at Dec. 31, 2014
Fixed-rate
borrowings
Floating-rate
borrowings
44
853
41
1,004
(342)
(298)
10,883
11,736
(537)
(496)
4,963
5,967
The following table shows the notional amount and the fair
cember 31, 2015 and December 31,2014, broken down by
value of hedging derivatives on interest rate risk as at De-
type of hedge.
Millions of euro
Notional amount
Fair value assets
Notional amount
Fair value liabilities
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
Fair value hedge
derivatives:
- interest rate swaps
883
904
46
55
-
-
-
-
Cash flow hedge
derivatives:
- interest rate swaps
7,115
506
Total interest rate
derivatives
7,998
1,410
117
163
5
60
3,738
4,557
(461)
(556)
3,738
4,557
(461)
(556)
The notional amount of derivatives classified as hedging in-
maturing between 2017 and 2020, in order to fix the cost of
struments at December 31, 2015 came to €11,736 million,
future funding in advance. The value also reflected the reduc-
with a corresponding negative fair value of €298 million.
tion in the notional amount of amortizing interest rate swaps.
The notional amount rose by €5,769 million. More specifically,
The improvement in the fair value of €198 million mainly re-
interest rate swaps with a total value of €1,342 million ex-
flects the positive fair value of the pre-hedge transactions
pired, while new derivatives amounted to €7,491 million, of
(€114 million) and the general decline in the yield curve during
which €7,100 million associated with the pre-hedge strategy
the year.
implemented in 2015 for the future refinancing of bond issues
Cash flow hedge derivatives
The following table shows the cash flows expected in coming years from cash flow hedge derivatives on interest rate risk.
Millions of euro
Fair value
Distribution of expected cash flows
at Dec. 31,
2015
2016
2017
2018
2019
2020
Beyond
Cash flow hedge derivatives on interest
rates:
- positive fair value
- negative fair value
117
(461)
1
(97)
1
(83)
(10)
(69)
169
(155)
(20)
(55)
(11)
(45)
276
Annual Report 2015 The following table shows the impact of reserves from cash flow hedge derivatives on interest rate risk on equity during
the period, gross of tax effects.
Millions of euro
Opening balance at January 1, 2014
Changes in fair value recognized in equity (OCI)
Changes in fair value recognized in profit or loss
Closing balance at December 31, 2014
Opening balance at January 1, 2015
Changes in fair value recognized in equity (OCI)
Changes in fair value recognized in profit or loss
Closing balance at December 31, 2015
Exchange risk
(1,729)
958
130
(641)
(641)
13
186
(442)
The following table shows the notional amount and the fair
transactions outstanding as at December 31, 2015 and De-
value of the hedging instruments on the exchange risk of
cember 31, 2014, broken down by type of hedged item.
Millions of euro
Fair value
Notional amount
Fair value Notional amount
at Dec. 31, 2015
at Dec. 31, 2014
Hedging instruments
Cross currency interest rate swaps (CCIRSs)
Cross currency interest rate swaps (CCIRSs)
Cross currency interest rate swaps (CCIRSs)
Currency forwards
Currency forwards
Total
Hedged item
Fixed-rate
borrowings
Floating-rate
borrowings
Future cash flows
denominated in
foreign currencies
Future commodity
purchases
denominated in
foreign currencies
Future cash flows
denominated in
foreign currencies
1,170
15,078
(508)
14,064
25
401
11
(102)
306
(38)
416
321
244
3,058
312
3,674
4
1,341
296
-
21
19,139
(224)
18,496
Cash flow hedges and fair value hedges include:
ted in currencies other than the euro, with a negative fair
> CCIRSs with a notional amount of €15,078 million used to
value of €77 million;
hedge the exchange risk on fixed-rate debt denominated
> currency forwards with a notional amount of €3,354 mil-
in currencies other than the euro, with a positive fair value
lion used to hedge the exchange risk associated with
of €1,170 million;
purchases of natural gas, purchases of fuel and expected
> CCIRSs with a notional amount of €707 million used to
cash flows in currencies other than the euro, with a fair
hedge the exchange risk on floating-rate debt denomina-
value of €248 million.
277
Consolidated financial statementsAnnual Report 2015 The following table reports the notional amount and fair value of foreign exchange derivatives at December 31, 2015 and
December 31, 2014, broken down by type of hedge.
Millions of euro
Notional amount
Fair value assets
Notional amount
Fair value liabilities
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
Fair value hedge derivatives:
- CCIRSs
-
-
-
-
-
-
Cash flow hedge derivatives:
- currency forwards
- CCIRSs
2,927
13,548
3,520
8,220
Total exchange derivatives
16,475
11,740
256
2,187
2,443
315
1,092
1,407
427
2,237
2,664
175
6,581
6,756
-
(8)
-
(3)
(1,094)
(1,628)
(1,102)
(1,631)
The notional amount of CCIRSs at December 31, 2015
The notional value of currency forwards at December 31,
amounted to €15,785 million (€14,801 million at December
2015 amounted to €3,354 million (€3,695 million at Decem-
31, 2014), an increase of €984 million. Cross currency interest
ber 31, 2014), a decrease of €341 million. The exposure to
rate swaps with a total value of €346 million expired, while
exchange risk, especially that associated with the US dollar, is
new derivatives amounted to €109 million. The value also re-
mainly due to purchases of natural gas and purchase of fuel.
flects developments in the exchange rate of the euro against
Changes in the notional amount are connected with normal
the main other currencies, which cause their notional amount
developments in operations.
to increase by €1,221 million.
Cash flow hedge derivatives
The following table shows the cash flows expected in coming years from cash flow hedge derivatives on exchange risk.
Millions of euro
Fair value
Distribution of expected cash flows
at Dec. 31,
2015
2016
2017
2018
2019
2020
Beyond
Cash flow hedge derivatives on
exchange rates:
- positive fair value
- negative fair value
2,443
(1,102)
498
(176)
510
(67)
218
(71)
661
(215)
217
(28)
2,818
(474)
The following table shows the impact of reserves from cash flow hedge derivatives on exchange risk on equity during the
period, gross of tax effects.
Millions of euro
Opening balance at January 1, 2014
Changes in fair value recognized in equity (OCI)
Changes in fair value recognized in profit or loss
Closing balance at December 31, 2014
Opening balance at January 1, 2015
Changes in fair value recognized in equity (OCI)
Changes in fair value recognized in profit or loss
Closing balance at December 31, 2015
278
(84)
(1,089)
64
(1,109)
(1,109)
753
(258)
(614)
Annual Report 2015 Commodity risk
Millions of euro
Notional amount
Fair value assets
Notional amount
Fair value liabilities
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
Cash flow hedge derivatives
Derivatives on power:
- swaps
- forwards/futures
Total derivatives on power
Derivatives on coal:
- swaps
Total derivatives on coal
Derivatives on gas and oil:
- swaps
- forwards/futures
Total derivatives on gas
and oil
Derivatives on CO2:
- forwards/futures
Total derivatives on CO2
TOTAL DERIVATIVES ON
COMMODITIES
79
59
138
6
6
67
715
545
1,149
1,694
-
-
124
1,426
782
1,550
204
204
213
213
10
3
13
-
-
35
270
305
13
13
50
95
145
-
-
41
197
238
50
50
86
175
261
978
978
150
772
152
348
500
718
718
13
1,586
(4)
(51)
(55)
(182)
(182)
(49)
(402)
(7)
(18)
(25)
(183)
(183)
(3)
(478)
922
1,599
(451)
(481)
54
54
-
-
(1)
(1)
-
-
1,130
3,457
331
433
2,215
2,817
(689)
(689)
The table reports the notional amount and fair value of deri-
tuations in the price of natural gas, for both purchases and
vatives hedging the price risk on commodities at December
sales, carried out for oil commodities and gas products with
31, 2015 and at December 31, 2014, broken down by type
physical delivery (all-in-one hedges).
of hedge.
Cash flow hedge derivatives on commodities with a negati-
The positive fair value of cash flow hedge derivatives on com-
ve fair value regard derivatives on gas and oil commodities
modities mainly regards hedges of gas and oil amounting to
amounting to €451 million, hedges of coal purchases for the
€305 million and derivatives on power and CO2 totaling €26
million. The first category primarily regards hedges of fluc-
generation companies amounting to €182 million and deriva-
tives on power amounting to €55 million.
Cash flow hedge derivatives
The following table shows the cash flows expected in coming years from cash flow hedge derivatives on commodity risk.
Millions of euro
Fair value
Distribution of expected cash flows
at Dec. 31,
2015
2016
2017
2018
2019
2020
Beyond
Cash flow hedge derivatives on
commodities:
- positive fair value
- negative fair value
331
(689)
325
(677)
5
(12)
1
-
-
-
-
-
-
-
279
Consolidated financial statementsAnnual Report 2015 The following table shows the impact of reserves from cash flow hedge derivatives on commodity risk on equity during
the period, gross of tax effects.
Millions of euro
Opening balance at January 1, 2014
Changes in fair value recognized in equity (OCI)
Changes in fair value recognized in profit or loss
Changes in fair value recognized in profit or loss - ineffective portion
Closing balance at December 31, 2014
Opening balance at January 1, 2015
Changes in fair value recognized in equity (OCI)
Changes in fair value recognized in profit or loss
Closing balance at December 31, 2015
(52)
(318)
122
-
(248)
(248)
(649)
275
(622)
44.2 Derivatives at fair value through profit or loss
The following table shows the notional amount and the fair value of derivatives at FVTPL as at December 31, 2015 and De-
cember 31, 2014.
Millions of euro
Notional amount
Fair value assets
Notional amount
Fair value liabilities
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
Derivatives at FVTPL
Derivatives on interest rates:
- interest rate swaps
- interest rate options
Derivatives on exchange rates:
- currency forwards
- CCIRs
Derivatives on power:
- swaps
- forwards/futures
- options
Total derivatives on power
Derivatives on coal:
- swaps
- forwards/futures
- options
Total derivatives on coal
Derivatives on gas and oil:
- swaps
- forwards/futures
- options
Total derivatives on gas and oil
Derivatives on CO2:
- forwards/futures
- options
Total derivatives on CO2
Derivatives on other
commodities:
- swaps
- forwards/futures
- options
Total derivatives on other
commodities
Embedded derivatives
TOTAL DERIVATIVES ON
COMMODITIES
280
50
-
65
-
2,166
2,215
-
-
796
5,995
7
6,798
873
76
-
949
531
7,957
133
8,621
165
-
165
8
-
-
8
-
1,207
5,391
104
6,702
1,527
73
3
1,603
645
5,677
99
6,421
68
-
68
35
-
1
36
-
2
-
68
-
73
422
-
495
241
14
-
255
4
-
159
-
155
480
2
637
187
7
3
197
1,538
1,859
236
3,633
2,686
944
278
3,908
21
-
21
5
-
-
5
-
19
-
19
10
-
1
11
-
157
50
3,335
28
714
5,879
14
6,607
887
24
2
913
675
8,555
184
9,414
161
-
161
54
-
-
54
-
180
50
2,956
-
1,611
5,456
80
7,147
1,742
51
10
1,803
902
5,170
102
6,174
63
-
63
138
-
2
140
-
(75)
(6)
(61)
-
(60)
(399)
-
(459)
(266)
(10)
(7)
(283)
(88)
(8)
(81)
-
(183)
(417)
(6)
(606)
(218)
(15)
(23)
(256)
(1,592)
(1,974)
(288)
(3,854)
(2,747)
(824)
(331)
(3,902)
(7)
-
(7)
(30)
-
-
(30)
-
(10)
-
(10)
(53)
-
(2)
(55)
-
18,757
17,110
4,479
4,935
20,719
18,513
(4,775)
(5,006)
Annual Report 2015 At December 31, 2015 the notional amount of trading deri-
in foreign currencies, which were classified as at fair value
vatives on interest rates came to €257 million. The change
through profit or loss as they did not meet the requirements
in the notional compared with December 31, 2014 is attri-
for hedge accounting.
butable to the expiry of €38 million in derivatives during
At December 31, 2015, the notional amount of derivatives
2015 that, although established for hedging purposes, did
on commodities came to €33,690 million.
not meet the requirements for hedge accounting. The fair
The fair value of trading derivatives on commodities classi-
value of a negative €79 million improved by €13 million on
fied as assets mainly reflects the market valuation of hedges
the previous year, mainly due to the general decline in the
of gas and oil amounting to €3,633 million and derivatives on
yield curve.
power amounting to €495 million.
At December 31, 2015, the notional amount of derivatives
The fair value of trading derivatives on commodities clas-
on exchange rates was €5,529 million. The increase in their
sified as liabilities mainly regards hedges of gas and oil
notional value and the reduction in the associated net fair
amounting to €3,854 million and derivatives on power
value of €71 million mainly reflected normal operations and
amounting to €459 million.
developments in exchange rates. In addition, in 2015 cross
These values include transactions that, although established
currency interest rate swaps with a notional amount of €28
for hedging purposes, did not meet the requirements for
million were established to hedge borrowing denominated
hedge accounting.
45. Assets measured at fair value
The Group determines fair value in accordance with IFRS 13
> Level 2, where the fair value is determined on basis of
whenever such measurement is required by the internatio-
inputs other than quoted prices included within Level 1
nal accounting standards as a recognition or measurement
that are observable for the asset or liability, either directly
criterion.
(such as prices) or indirectly (derived from prices);
Fair value is defined as the price that would be received to
> Level 3, where the fair value is determined on the basis of
sell an asset or paid to transfer a liability, in an orderly tran-
unobservable inputs.
saction, between market participants, at the measurement
This note also provides detailed disclosures concerning the
date (i.e. an exit price).
valuation techniques and inputs used to perform these me-
The best proxy of fair value is market price, i.e. the current
asurements.
publically available price actually used on a liquid and active
To that end:
market.
> recurring fair value measurements of assets or liabilities
The fair value of assets and liabilities is classified in accor-
are those required or permitted by the IFRS in the balance
dance with the three-level hierarchy described below, de-
sheet at the close of each period;
pending on the inputs and valuation techniques used in de-
> non-recurring fair value measurements are those required
termining their fair value:
or permitted by the IFRS in the balance sheet in particular
> Level 1, where the fair value is determined on basis of
circumstances.
quoted prices (unadjusted) in active markets for identical
For general information or specific disclosures on the ac-
assets or liabilities that the entity can access at the mea-
counting treatment of these circumstances, please see note
surement date;
2 “Accounting policies and measurement criteria”.
281
Consolidated financial statementsAnnual Report 2015 The following table shows, for each class of assets measu-
of the reporting period and the level in the fair value hierar-
red at fair value on a recurring or non-recurring basis in the
chy into which the fair value measurements of those assets
financial statements, the fair value measurement at the end
are classified.
Millions of euro
Non-current assets
Current assets
Notes
Fair value
Level 1
Level 2
Level 3
Fair value
Level 1
Level 2
Level 3
Equity investments
in other companies
measured at fair value
Service concession
arrangements
Financial investments in
funds
Cash flow hedge
derivatives:
- on interest rates
- on exchange rates
- on commodities
Fair value hedge
derivatives:
- on interest rates
Trading derivatives:
- on interest rates
- on exchange rates
- on commodities
Inventories measured at
fair value
Assets classified as held
for sale
24
24
24.1
44
44
44
44
44
44
44
26
30
181
181
-
631
45
116
2,163
5
46
2
5
6
-
-
-
45
-
-
1
-
-
-
1
-
-
631
-
116
2,163
4
46
2
5
5
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1
280
326
-
-
63
-
-
-
-
-
283
-
-
-
-
-
-
1
280
43
-
-
63
4,403
3,071
1,332
65
6,887
65
-
-
-
-
-
-
-
-
-
-
-
-
-
-
6,887
The fair value of equity investments in other companies is
volatility), discounting expected future cash flows on the
determined for listed companies on the basis of the quo-
basis of the market yield curve and translating amounts in
ted price set on the closing date of the year, while that for
currencies other than the euro using exchange rates provi-
unlisted companies is based on a reliable valuation of the
ded by the European Central Bank. For contracts involving
relevant assets and liabilities.
commodities, the measurement is conducted using prices,
where available, for the same instruments on both regulated
“Service concession arrangements” concern electricity di-
and unregulated markets.
stribution operations in Brazil by Ampla and Coelce and are
accounted for in accordance with IFRIC 12. Fair value was
In accordance with the new international accounting stan-
estimated as the net replacement cost based on the most
dards, in 2013 the Group included a measurement of credit
recent rate information available and on the general price
risk, both of the counterparty (Credit Valuation Adjustment or
index for the Brazilian market.
CVA) and its own (Debit Valuation Adjustment or DVA), in order
to adjust the fair value of financial instruments for the corre-
The fair value of derivative contracts is determined using the
sponding amount of counterparty risk. More specifically, the
official prices for instruments traded on regulated markets.
Group measures CVA/DVA using a Potential Future Exposure
The fair value of instruments not listed on a regulated mar-
valuation technique for the net exposure of the position and
ket is determined using valuation methods appropriate for
subsequently allocating the adjustment to the individual finan-
each type of financial instrument and market data as of the
cial instruments that make up the overall portfolio. All of the
close of the period (such as interest rates, exchange rates,
inputs used in this technique are observable on the market.
282
Annual Report 2015 The notional amount of a derivative contract is the amount
Finally, “assets classified as held for sale” primarily regard
on which cash flows are exchanged. This amount can be ex-
Slovenské elektrárne, HydroDolomiti Enel and Compostilla.
pressed as a value or a quantity (for example tons, converted
The associated fair value is the estimated realizable value,
into euros by multiplying the notional amount by the agreed
net of disposal prices, as determined on the basis of the do-
price).
cumentation currently available on the sale of the company.
Amounts denominated in currencies other than the euro are
More specifically, in the more significant case of Slovenské
converted into euros at the year-end exchange rates provi-
elektrárne, the overall price is subject to an adjustment that
ded by the European Central Bank.
will be calculated by independent experts and applied fol-
The notional amounts of derivatives reported here do not
lowing the closing of the second phase (12 months after
necessarily represent amounts exchanged between the
receiving the Trial Operation Permit for units 3 and 4 of the
parties and therefore are not a measure of the Group’s cre-
Mochovce nuclear power plant) on the basis of a set of para-
dit risk exposure. For listed debt instruments, the fair value
meters, including the evolution of the net financial position
is given by official prices. For unlisted instruments the fair
of Slovenské elektrárne, developments in energy prices in
value is determined using appropriate valuation techniques
the Slovak market, operating efficiency levels at Slovenské
for each category of financial instrument and market data
elektrárne as measured against benchmarks specified in
at the closing date of the year, including the credit spreads
the agreement, and the enterprise value of units 3 and 4
of Enel SpA.
of Mochovce.
45.1 Fair value of other assets
For each class of assets not measured at fair value on a re-
and the level in the fair value hierarchy into which the fair
curring basis but whose fair value must be reported, the fol-
value measurements of those assets are classified.
lowing table reports the fair value at the end of the period
Millions of euro
Non-current assets
Current assets
Notes
Fair value
Level 1
Level 2
Level 3
Fair value
Level 1
Level 2
Level 3
Investment property
Equity investments in
other companies
Inventories
18
24
26
172
7
-
-
-
-
14
-
-
158
7
-
-
-
68
-
-
-
-
-
-
-
-
68
The table reports investment property, equity investments
The value of equity investments classified in Level 3 decrea-
in other companies and inventories measured at cost, who-
sed by €5 million compared with 2014 and regards a number
se fair value has been estimated at €172 million, €7 million
of equity investments of Endesa.
and €68 million respectively. The amounts were calculated
The value of inventories largely regards property not used
with the assistance of appraisals conducted by independent
in operations.
experts, who used different methods depending on the spe-
cific assets involved.
283
Consolidated financial statementsAnnual Report 2015 46. Liabilities measured at fair value
The following table reports for each class of liabilities mea-
of the reporting period and the level in the fair value hierar-
sured at fair value on a recurring or non-recurring basis in the
chy into which the fair value measurements are categorized.
financial statements the fair value measurement at the end
Millions of euro
Non-current liabilities
Current liabilities
Notes
Fair value
Level 1
Level 2
Level 3
Fair value
Level 1
Level 2
Level 3
Cash flow hedge derivatives:
- on interest rates
- on exchange rates
- on commodities
Trading derivatives:
- on interest rates
- on exchange rates
- on commodities
Contingent consideration
Payables for put options granted to
minority shareholders
Liabilities included in disposal groups
classified as held for sale
44
44
44
44
44
44
40
40
31
459
1,006
12
16
18
7
-
21
-
-
-
1
-
-
2
-
-
-
459
1,006
11
16
18
5
-
-
-
-
-
-
-
-
-
-
21
-
-
-
2
2
115
562
2
96
677
65
43
-
-
4,626
4,052
36
793
5,364
-
-
-
65
43
574
-
-
-
-
-
-
-
-
-
36
793
5,364
Contingent consideration regards a number of equity in-
for the liability associated with the options on a number of
vestments held by the Group in North America, whose fair
Latin American companies (€21 million) and Maicor Wind
value was determined on the basis of the contractual terms
(€15 million).
and conditions.
The “liabilities included in disposal groups classified as held
The item “payables for put options granted to minority sha-
for sale“ mainly regard Slovenské elektrárne. The fair value
reholders” includes the liability for the options on Enel Di-
is the estimated realizable value, net of disposal prices, as
stributie Muntenia and Enel Energie Muntenia in the total
determined on the basis of the documentation currently
amount of €778 million, determined on the basis of the exer-
available on the sale of the company.
cise conditions in the associated contracts, and €36 million
46.1 Fair value of other liabilities
For each class of liabilities not measured at fair value in the
and the level in the fair value hierarchy into which the fair
balance sheet but whose fair value must be reported, the
value measurements of those liabilities are classified.
following table reports the fair value at the end of the period
Millions of euro
Bonds:
- fixed rate
- floating rate
Bank borrowings:
- fixed rate
- floating rate
Non-bank borrowings:
- fixed rate
- floating rate
Total
284
Notes
Fair value
Level 1
Level 2
Level 3
41.3.1
41.3.1
41.3.1
41.3.1
41.3.1
41.3.1
41,083
5,383
1,256
6,843
2,012
341
56,918
39,356
2,237
-
-
-
-
41,593
1,727
3,146
1,256
6,843
2,012
341
15,325
-
-
-
-
-
-
-
Annual Report 2015 47. Related parties
As an operator in the field of generation, distribution, tran-
or indirectly controlled by the Italian State, the Group’s con-
sport and sale of electricity and the sale of natural gas, Enel
trolling shareholder.
carries out transactions with a number of companies directly
The table below summarizes the main types of transactions carried out with such counterparties.
Related party
Relationship
Nature of main transactions
Acquirente Unico - Single Buyer
Fully controlled (indirectly) by the
Ministry for the Economy and Finance
Purchase of electricity for the enhanced
protection market
GME - Energy Markets Operator
Fully controlled (indirectly) by the
Ministry for the Economy and Finance
GSE - Energy Services Operator
Fully controlled (directly) by the
Ministry for the Economy and Finance
Indirectly controlled by the
Ministry for the Economy and Finance
Sale of electricity on the Power Exchange
Purchase of electricity on the Power Exchange
for pumping and plant planning
Sale of subsidized electricity
Payment of A3 component for renewable
resource incentives
Sale of electricity on the Ancillary Services
Market
Purchase of transport, dispatching and metering
services
Directly controlled by the Ministry
for the Economy and Finance
Sale of electricity transport services
Purchase of fuels for generation plants, storage
services and natural gas distribution
Directly controlled by the Ministry
for the Economy and Finance
Purchase of IT services and supply of goods
Fully controlled (directly) by the
Ministry for the Economy and Finance
Purchase of postal services
Terna
Eni Group
Finmeccanica Group
Poste Italiane Group
Finally, Enel also maintains relationships with the pension
All transactions with related parties were carried out on nor-
funds FOPEN and FONDENEL, as well as Fondazione Enel
mal market terms and conditions, which in some cases are
and Enel Cuore, an Enel non-profit company devoted to pro-
determined by the Authority for Electricity, Gas and the Wa-
viding social and healthcare assistance.
ter System.
285
Consolidated financial statementsAnnual Report 2015 The following tables summarize transactions with related
outstanding at December 31, 2015 and December 31, 2014
parties, associated companies and joint arrangements
and carried out during the period.
Acquirente
Unico
GME
Terna
Eni
GSE
Poste Italiane
Group
Other
Key management
personnel
Associates and joint
Total in financial
Total 2015
arrangements Overall total 2015
statements
% of total
195
290
-
3
11
-
-
-
37
-
-
-
102
-
-
-
115
16
-
26
60
3
-
-
Poste Italiane
Group
GSE
Other
Key management
Associates and joint
Overall total at
Total in financial
personnel
Total at Dec. 31, 2015
arrangements
Dec. 31, 2015
statements
% of total
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,508
311
-
6,877
2,332
54
(24)
-
894
105
-
4
2,874
13
534
185
37
75
3
15
212
99
-
-
29
43
2
30
-
37
1
-
-
-
73,076
2,582
1,563
37,644
16,457
2,654
168
4,969
12,797
2,381
2,898
1,549
11,775
11,222
5,583
314
15
7,089
2,431
54
(24)
29
937
135
2
4
2,911
14
534
185
37
7.6%
12.2%
1.0%
18.8%
14.8%
2.0%
-14.3%
0.6%
7.3%
0.1%
4.7%
0.3%
24.7%
0.1%
5
-
5
-
38
1
-
8
-
15
-
2
4
27
4
1
27
14
68
-
69
-
113
45
-
-
Eni
116
-
-
-
184
1,256
-
-
150
21
-
-
-
-
Millions of euro
Income statement
Revenue from sales and
services
Other revenue
Other financial income
Electricity, gas and fuel
purchases
Services and other
materials
Other operating expenses
Net income/(expense)
from commodity contracts
measured at fair value
Other financial expense
-
-
-
2,468
1,190
1,503
-
-
5
-
-
-
3,695
1,553
136
1,464
1
3
-
-
91
-
-
-
1,954
3
(24)
-
Millions of euro
Balance sheet
Trade receivables
Other current financial
assets
Other current assets
Other non-current
liabilities
Trade payables
Other current liabilities
Other information
Guarantees issued
Guarantees received
Commitments
Acquirente
Unico
GME
Terna
-
-
-
-
620
-
-
-
-
217
473
-
4
-
373
-
280
-
-
-
25
-
376
8
253
-
2
286
Annual Report 2015 2,468
1,190
1,503
37
115
Millions of euro
Income statement
Revenue from sales and
services
Other revenue
Other financial income
Electricity, gas and fuel
purchases
Services and other
materials
Other operating expenses
Net income/(expense)
from commodity contracts
measured at fair value
Other financial expense
Millions of euro
Balance sheet
Trade receivables
Other current financial
assets
Other current assets
Other non-current
liabilities
Trade payables
Other current liabilities
Other information
Guarantees issued
Guarantees received
Commitments
3,695
1,553
136
1,464
91
1,954
102
-
-
-
1
3
-
-
-
-
-
-
-
-
-
-
5
-
3
(24)
-
25
-
-
8
-
2
217
473
280
253
-
-
-
-
-
-
4
-
-
-
-
113
45
Eni
116
-
-
-
-
-
-
-
-
-
150
21
195
290
-
3
11
-
-
-
-
-
-
-
-
-
68
69
620
373
376
184
1,256
38
-
-
-
-
-
-
5
-
5
-
1
-
8
-
16
-
26
60
3
-
-
15
-
2
4
4
27
1
27
14
Acquirente
Unico
GME
Terna
Eni
GSE
Group
Other
Poste Italiane
Key management
personnel
Associates and joint
Total 2015
arrangements Overall total 2015
Total in financial
statements
% of total
-
-
-
-
-
-
-
-
5,508
311
-
6,877
2,332
54
(24)
-
75
3
15
212
99
-
-
29
5,583
314
15
7,089
2,431
54
(24)
29
73,076
2,582
1,563
37,644
16,457
2,654
168
4,969
7.6%
12.2%
1.0%
18.8%
14.8%
2.0%
-14.3%
0.6%
Acquirente
Unico
GME
Terna
GSE
Group
Other
Poste Italiane
Key management
personnel
Total at Dec. 31, 2015
Associates and joint
arrangements
Overall total at
Dec. 31, 2015
Total in financial
statements
% of total
-
-
-
-
-
-
-
-
-
894
-
105
4
2,874
13
534
185
37
43
2
30
-
37
1
-
-
-
937
2
135
4
2,911
14
534
185
37
12,797
2,381
2,898
1,549
11,775
11,222
7.3%
0.1%
4.7%
0.3%
24.7%
0.1%
287
Consolidated financial statementsAnnual Report 2015 Acquirente
Unico
GME
Terna
Eni
GSE
Poste Italiane
Group
Other
Key management
personnel
Associates and joint
Total in financial
Total 2014
arrangements Overall total 2014
statements
% of total
Millions of euro
Income statement
Revenue from sales and
services
Other revenue
Other financial income
Electricity, gas and fuel
purchases
Services and other
materials
Other operating expenses
Net income/(expense)
from commodity contracts
measured at fair value
Other financial expense
3,087
1,150
1,124
-
-
-
-
-
4,395
1,690
-
3
17
-
163
-
-
-
4
-
64
1,886
4
29
-
Millions of euro
Balance sheet
Trade receivables
Other current assets
Other non-current
liabilities
Trade payables
Other current liabilities
Non-current derivative
financial liabilities
Other information
Guarantees received
Commitments
Acquirente
Unico
GME
Terna
-
1
-
444
7
-
762
382
-
-
-
-
-
-
-
-
544
13
-
406
1
24
-
1
1
-
1,229
77
46
-
-
Eni
127
1
-
443
-
-
150
19
256
353
-
1
4
-
-
-
GSE
24
102
-
1,006
-
-
-
-
25
-
-
-
119
-
-
-
63
5
-
2
46
-
-
-
Poste Italiane
Group
Other
Key management
Associates and joint
Overall total at
Total in financial
personnel
Total at Dec. 31, 2014
arrangements
Dec. 31, 2014
statements
% of total
5
5
-
45
1
-
4
18
14
5
2
29
-
-
24
11
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,705
363
-
7,381
2,295
53
46
-
1,158
134
3,073
2
2
24
178
49
46
4
23
214
145
-
-
28
62
8
-
86
1
-
-
-
73,328
2,463
1,248
36,928
17,179
2,362
(225)
5,540
12,022
3,465
1,464
13,419
10,827
2,441
5,751
367
23
7,595
2,440
53
46
28
1,220
142
3,159
2
3
24
178
49
7.8%
14.9%
1.8%
20.6%
14.2%
2.2%
-20.4%
0.5%
10.1%
4.1%
0.1%
23.5%
-
1.0%
In November 2010, the Board of Directors of Enel SpA ap-
of the provisions of Article 2391-bis of the Italian Civil Code
proved a procedure governing the approval and execution
and the implementing regulations issued by CONSOB.
of transactions with related parties carried out by Enel SpA
In 2015, no transactions were carried out for which it was
directly or through subsidiaries. The procedure (available at
necessary to make the disclosures required in the rules on
http://www.enel.com/en-GB/group/governance/rules/rela-
transactions with related parties adopted with CONSOB Re-
ted_parties/) sets out rules designed to ensure the transpa-
solution 17221 of March 12, 2010, as amended with Resolu-
rency and procedural and substantive propriety of transac-
tion 17389 of June 23, 2010.
tions with related parties. It was adopted in implementation
288
Annual Report 2015 Millions of euro
Income statement
Revenue from sales and
services
Other revenue
Other financial income
Electricity, gas and fuel
purchases
Services and other
materials
Other operating expenses
Net income/(expense)
from commodity contracts
measured at fair value
Other financial expense
Millions of euro
Balance sheet
Trade receivables
Other current assets
Other non-current
liabilities
Trade payables
Other current liabilities
Non-current derivative
financial liabilities
Other information
Guarantees received
Commitments
3,087
1,150
1,124
25
4,395
1,690
64
1,229
163
1,886
119
17
-
-
-
-
-
3
-
1
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
444
7
4
-
4
29
-
544
13
-
1
-
1
24
1
-
77
46
-
-
-
-
-
Eni
127
1
150
19
256
353
-
1
4
-
-
-
-
-
-
-
-
24
102
762
382
406
443
1,006
-
-
-
-
-
-
5
5
-
1
-
45
4
18
63
46
5
-
2
-
-
-
14
29
5
2
-
-
24
11
Acquirente
Unico
GME
Terna
Eni
GSE
Group
Other
Poste Italiane
Key management
personnel
Associates and joint
Total 2014
arrangements Overall total 2014
Total in financial
statements
% of total
-
-
-
-
-
-
-
-
5,705
363
-
7,381
2,295
53
46
-
46
4
23
214
145
-
-
28
5,751
367
23
7,595
2,440
53
46
28
73,328
2,463
1,248
36,928
17,179
2,362
(225)
5,540
7.8%
14.9%
1.8%
20.6%
14.2%
2.2%
-20.4%
0.5%
Acquirente
Unico
GME
Terna
GSE
Group
Other
Poste Italiane
Key management
personnel
Total at Dec. 31, 2014
Associates and joint
arrangements
Overall total at
Dec. 31, 2014
Total in financial
statements
% of total
-
-
-
-
-
-
-
-
1,158
134
2
3,073
2
24
178
49
62
8
-
86
1
-
-
-
1,220
142
2
3,159
3
24
178
49
12,022
3,465
1,464
13,419
10,827
2,441
10.1%
4.1%
0.1%
23.5%
-
1.0%
289
Consolidated financial statementsAnnual Report 2015 48. Contractual commitments and
guarantees
The commitments entered into by the Enel Group and the guarantees given to third parties are shown below.
Millions of euro
Guarantees given:
- sureties and other guarantees granted to third
parties
Commitments to suppliers for:
- electricity purchases
- fuel purchases
- various supplies
- tenders
- other
Total
TOTAL
at Dec. 31, 2015
at Dec. 31, 2014
Change
6,701
4,304
2,397
48,733
64,114
1,725
1,905
2,895
119,372
126,073
54,384
63,605
1,782
1,785
2,345
123,901
128,205
(5,651)
509
(57)
120
550
(4,529)
(2,132)
For more details on the expiry of commitments and guarantees, please see the section “Commitments to purchase com-
modities” in note 42.
290
Annual Report 2015 49. Contingent liabilities and assets
Porto Tolle thermal plant
- Air pollution - Criminal
proceedings against Enel
directors and employees
liability by Enel/Enel Produzione – with the public entities of
Emilia Romagna to express social solidarity in line with the
general sustainability policies of the Group. The suits with
the Ministry and private parties (environmental associations
and a number of resident individuals, who have received no
payments from Enel during the proceedings) remain open.
On July 10, 2014, the decision of the Venice Court of Appe-
The Court of Adria, in a ruling issued on March 31, 2006,
al was filed ordering the defendants, jointly with Enel/Enel
convicted former directors and employees of Enel for a num-
Produzione, to pay damages in the amount of €312,500, plus
ber of incidents of air pollution caused by emissions from
more than €55,000 in legal expenses. The Ministry’s request
the Porto Tolle thermoelectric plant. The decision held the
for calculation of the amount of damages it claimed it was
defendants and Enel (as a civilly liable party) jointly liable for
owed was deemed inadmissible, as grounds for barring such
the payment of damages for harm to multiple parties, both
action arose in the course of the criminal proceedings. In
natural persons and public authorities. Damages for a num-
the meantime the Court issued a general conviction with
ber of mainly private parties (individuals and environmental
damages to be awarded in a separate decision and orde-
associations), were set at the amount of €367,000. The cal-
red payment of legal costs. Enel ledged an appeal with the
culation of the amount of damages owed to certain public
Court of Cassation in February 2015 of the ruling of the Veni-
entities (Ministry for the Environment, a number of public
ce Court of Appeal of July 10, 2014 and is currently waiting
entities of Veneto and Emilia Romagna, including the area’s
for the date of the hearing to be set.
park agencies) was postponed to a later civil trial, although a
In August 2011, the Public Prosecutor’s Office of Rovigo
“provisional award” of about €2.5 million was immediately
asked that a number of directors, former directors, officers,
due.
former officers and employees of Enel and Enel Produzione
An appeal was lodged against the ruling of the Court of Adria
be remanded for trial on the charge of willful omission to
and on March 12, 2009, the Court of Appeal of Venice partial-
take precautionary actions to prevent a disaster in respect of
ly reversed the lower court decision. It found that the former
the alleged emissions from the Porto Tolle plant. Subsequen-
directors had not committed a crime and that there was no
tly, the public prosecutor filed charges of willfully causing a
environmental damage and therefore ordered recovery of
disaster. During 2012, the pre-trial hearing judge of Rovigo,
the provisional award already paid. The prosecutors and the
granting the request of the Public Prosecutor’s Office of Ro-
civil claimants lodged an appeal against the ruling with the
vigo, ordered the committal for trial of all of the accused for
Court of Cassation. In a ruling on January 11, 2011, the Court
both offences. The Ministry for the Environment, the Mini-
of Cassation granted the appeal, overturning the decision of
stry of Health and other actors, mainly local authorities in
the Venice Court of Appeal, and referred the case to the ci-
Emilia Romagna and Veneto, as well as the park agencies of
vil section of the Venice Court of Appeal to rule as regards
the area, joined the case as injured parties, seeking unspeci-
payment of damages and the division of such damages
fied damages from the above individuals, without citing Enel
among the accused. As regards amounts paid to a number
or Enel Produzione as liable parties. Evidence was submit-
of public entities in Veneto, Enel has already made payment
ted during 2013. During the year, as part of the agreement
under a settlement agreement reached in 2008. With a suit
mentioned earlier, most of the public entities withdrew their
lodged in July 2011, the Ministry for the Environment, the
suits.
public entities of Emilia Romagna and the private actors who
At the hearing of March 31, 2014, the Court sitting en banc
had already participated as injured parties in the criminal
issued its ruling of first instance, acquitting all of the accu-
case asked the Venice Court of Appeal to order Enel SpA and
sed of the charge of willful omission to take precautionary
Enel Produzione to pay civil damages for harm caused by the
safety measures. The Court also acquitted all of the accused
emissions from the Porto Tolle power station. The amount
of the charge of willfully causing a disaster, with the excep-
of damages requested for economic and environmental los-
tion of the two former Chief Executive Officers of Enel SpA
ses was about €100 million, which Enel contested. During
(although the Court did not grant the request for recognition
2013, an agreement was reached – with no admission of
of aggravating circumstances as provided for when the di-
291
Consolidated financial statementsAnnual Report 2015 saster actually occurs). The former Chief Executive Officers
to hear the testimony of the final witnesses called by the
were then ordered to pay unspecified damages in a separate
other accused.
civil action, with a total provisional ruling of €410,000 and
payment of court costs for the remaining civil parties to the
action. The Court’s full ruling was filed at the end of Sep-
tember 2014. The decision was appealed by the two former
Chief Executive Officers and by the public prosecutor at the
start of November 2014. Further appeals were later filed by
(i) the Chief Executive Officer in office until 2014, despite
having been acquitted, in order to obtain the denial of the
grounds for appeal of the prosecutor and a broader acquittal
than that obtained in the first trial; (ii) two local authorities
that had not initially participated; (iii) the two Ministries (En-
vironment and Health) and (iv) the Italia Nostra association.
The date of the hearing for arguments before the Venice
Court of Appeal has not yet been set.
Brindisi Sud thermal
generation plant -
Criminal proceedings
against Enel employees
Out-of-court disputes
and litigation connected
with the blackout of
September 28, 2003
In the wake of the blackout that occurred on September 28,
2003, numerous claims were filed against Enel Distribuzione
for automatic and other indemnities for losses. These claims
gave rise to substantial litigation before justices of the pe-
ace, mainly in the regions of Calabria, Campania and Basi-
licata, with a total of some 120,000 proceedings. Charges
in respect of such indemnities could be recovered in part
under existing insurance policies. Most of the initial rulings
by these judges found in favor of the plaintiffs, while appella-
te courts have nearly all found in favor of Enel Distribuzione.
The Court of Cassation has also consistently ruled in favor
of Enel Distribuzione. At December 31, 2015 pending cases
numbered about 18,000 as a result of additional appeals fi-
led. In addition, in view of the rulings in Enel’s favor by both
A criminal proceeding is under way before the Court of Brin-
the Courts of Appeal and the Court of Cassation, the flow of
disi concerning the Brindisi Sud thermal plant. A number of
new claims has come to a halt. Beginning in 2012, a num-
employees of Enel Produzione – cited as a liable party in civil
ber of actions for recovery were initiated, which continue, to
litigation during 2013 – have been accused of causing cri-
obtain repayment of amounts paid by Enel in execution of
minal damage and dumping of hazardous substances with
the rulings in the courts of first instance.
regard to the alleged contamination of land adjacent to the
In May 2008, Enel served its insurance company (Cattoli-
plant with coal dust as a result of actions between 1999 and
ca) a summons to ascertain its right to reimbursement of
2011. At the end of 2013, the accusations were extended
amounts paid in settlement of unfavorable rulings. The case
to cover 2012 and 2013. As part of the proceeding, injured
also involved a number of reinsurance companies in the pro-
parties, including the Province and City of Brindisi, have
ceedings, which have challenged Enel’s claim. In a ruling of
submitted claims for total damages of about €1.4 billion. The
October 21, 2013, the Court of Rome granted Enel’s peti-
argument phase is under way.
tion, finding the insurance coverage to be valid and ordering
Criminal proceedings are also under way before the Courts
Cattolica, and consequently the reinsurance companies, to
of Reggio Calabria and Vibo Valentia against a number of em-
hold Enel harmless in respect of amounts paid or to be paid
ployees of Enel Produzione for the offense of illegal waste
to users and their legal counsel as well as, within the limits
disposal in connection with alleged violations concerning the
established by the policies, to pay defense costs.
disposal of waste from the Brindisi plant. Enel Produzione
On the basis of that ruling, in October 2014, Enel filed suit
has not been cited as a liable party for civil damages.
against Cattolica with the Court of Rome to obtain a quan-
After the filing of the findings of the new expert witnesses
tification of the amounts due to Enel and payment of those
requested by the Court, the proceedings before the Court of
amounts by Cattolica.
Reggio Calabria were adjourned until March 31, 2016 to con-
The first hearing with the parties in court was set, after a
tinue the questioning of the new expert witnesses begun
number of postponements, for July 18, 2016, to allow Catto-
on February 17, 2016. The proceedings before the Court of
lica to carry out additional summons.
Vibo Valentia were adjourned until March 22, 2016 in order
Subsequently, Cattolica appealed the ruling of the court of
292
Annual Report 2015 first instance of October 21, 2013, before the Rome Court of
SpA and Enelpower, in presenting their defense, contested
Appeal, asking that it be overturned.
all aspects of the foundation of the plaintiff’s case and they
The suit was adjourned until February 23, 2018 for final ple-
took all steps available to them to defend their interests.
adings.
BEG litigation
On April 22, 2014, in response to a motion filed by Enel and
Enelpower, the court revoked the previous ruling issued
against the companies freezing assets of around $600 mil-
lion. The suit is pending and no measures, preliminary or
otherwise, have been taken by the court. On April 27, 2015,
Following an arbitration proceeding initiated by BEG SpA in
Enel SpA and Enelpower SpA asked for the case to be
Italy, Enelpower obtained a ruling in its favor in 2002, which
transferred from the New York State Courts to the Federal
was upheld by the Court of Cassation in 2010, which enti-
Courts. In a ruling of March 10, 2016, the Federal Court de-
rely rejected the complaint with regard to alleged breach by
nied the motion of Enel SpA and Enelpower SpA, confirming
Enelpower of an agreement concerning the construction of
the jurisdiction of the New York State Court, where the case
a hydroelectric power station in Albania.
is proceeding.
Subsequently, BEG, acting through its subsidiary Albania
BEG Ambient Shpk, filed suit against Enelpower and Enel
On June 2, 2014 Albania BEG Ambient obtained an order
SpA in Albania concerning the matter, obtaining a ruling,
from the court in the Hague, based upon the preliminary
upheld by the Albanian Supreme Court of Appeal, ordering
injunction, freezing up to €440 million held with a number
Enelpower and Enel to pay tortious damages of about €25
of entities and the establishment of a lien on the shares of
million for 2004 as well as an unspecified amount of tortious
two subsidiaries of Enel SpA in that country. Enel SpA and
damages for subsequent years. Following the ruling, Alba-
Enelpower SpA challenged that ruling and on July 1, 2014,
nia BEG Ambient demanded payment of more than €430
the Dutch court, in granting the petition of Enel and Enelpo-
million.
wer, provisionally determined the value of the suit at €25
million and ordered the removal of the preliminary injunction
The European Court of Human Rights, with which Enelpo-
subject to the issue of a bank guarantee in the amount of
wer SpA and Enel SpA had filed an appeal for violation of
€25 million by Enel and Enelpower. Enel and Enelpower
the right to a fair trial and the rule of law by the Republic of
have appealed this ruling.
Albania, rejected the petition as inadmissible. The ruling was
On July 3, 2014, Albania BEG Ambient sought to obtain a
purely procedural and did not address the substance of the
second order to freeze assets. Following the hearing of Au-
suit.
gust 28, 2014, the court in the Hague granted a preliminary
injunction for the amount of €425 million on September 18,
In February 2012, Albania BEG Ambient filed suit against
2014. Enel and Enelpower have appealed this injunction. In a
Enel SpA and Enelpower SpA with the Tribunal de Grande
ruling of February 9, 2016, the Hague Court of Appeal upheld
Instance in Paris in order to render the ruling of the Albanian
the appeals, ordering the revocation of the preliminary injun-
court enforceable in France. Enel SpA and Enelpower SpA
ctions subject to the pledging of a guarantee by Enel of €440
challenged the suit. The proceeding is still under way and the
million and a counter-guarantee by Albania BEG Ambient of
Court has issued no preliminary or definitive rulings so far.
about €50 million (the estimated value of the losses of Enel
Subsequently, again at the initiative of Albania BEG Ambient,
and Enelpower from the seizure of assets and the pledge of
Enel France was served with two “Saise Conservatoire de
bank guarantees).
Créances” (orders for the precautionary attachment of recei-
At the end of July 2014, Albania BEG Ambient filed suit in
vables) to conserve any receivables of Enel SpA in respect
the Netherlands to render the ruling of the Albanian court
of Enel France. J.P. Morgan Bank Luxembourg SA was also
enforceable in that country. At the end of January 2016, the
served with an analogous order in respect of any receivables
final hearing was held and the decision will be issued on
of Enel SpA.
May 4, 2016.
In March 2014, Albania BEG Ambient filed suit against Enel
Albania BEG Ambient also filed suits in Ireland and Luxem-
SpA and Enelpower SpA in New York to render the ruling of
bourg to render the ruling of the Court of Tirana enforceable
the Albanian court enforceable in the State of New York. Enel
in those two countries. In Ireland, the court issued a ruling
293
Consolidated financial statementsAnnual Report 2015 on March 8, 2016 upholding the defense of Enel and Enelpo-
wer, finding that Ireland had no jurisdiction. The ruling will be
approved in the coming weeks. In Luxembourg, the procee-
ding is still under way and Enel and Enelpower are challen-
Red Eléctrica de España
arbitration - Spain
ging the claims put forth by Albania BEG Ambient. The court
On July 1, 2010, in compliance with legal requirements, En-
has issued no ruling.
desa Distribución Eléctrica (“EDE”) signed a contract with
Red Eléctrica de España (“REE”) for the sale of assets con-
With a ruling of June 16, 2015, the first level was completed
sisting of the transmission network owned by EDE. The pri-
in the additional suit lodged by Enelpower SpA and Enel SpA
ce was set at about €1,400 million. The contract provided for
with the Court of Rome asking the Court to ascertain the
a price adjustment if remuneration decreased or increased
liability of BEG SpA for having evaded compliance with the
following the liquidation carried out by the Comisión Nacio-
arbitration ruling issued in Italy in favor of Enelpower SpA
nal de los Mercados y la Competencia (CNMC) by Decem-
through the legal action taken by Albania BEG Ambient. With
ber 31, 2013.
this action, Enelpower SpA and Enel SpA have asked the
REE’s interpretation of Ministerial Order IET/2443/2013, pu-
Court to find BEG liable and order it to pay damages in the
blished in December 2013, would produce a lower remune-
amount that the other could be required to pay to Albania
ration than that provided for in the contract and, on that ba-
BEG Ambient in the event of the enforcement of the senten-
sis, the company undertook an arbitration proceeding before
ce issued by the Albanian courts. With the ruling, the Court
the Corte Civil y Mercantil de Arbitraje (CIMA), asking for an
of Rome found that BEG SpA did not have standing to be
adjustment of the sale price.
sued, or alternatively, that the request was not admissible
The value of the claim was subsequently quantified at €94
for lack of an interest for Enel SpA and Enelpower SpA to
million. In November 2015, a settlement was reached to end
sue, as the Albanian ruling had not yet been declared enfor-
the arbitration proceeding (and any possible litigation).
ceable in any court. The Court ordered the setting off of court
costs. Enel SpA and Enelpower SpA appealed the ruling be-
fore the Rome Court of Appeal, asking that it be overturned
in full.
Violations of Legislative
Decree 231/2001
The following two cases for alleged violation of Legislative
Decree 231/2001 concerning the administrative liability of le-
gal persons are pending. One involves Enel Produzione and
one involves Enel Distribuzione, for omission of accident
prevention measures:
> for an accident involving an employee of a subcontrac-
tor at the Enel Federico II plant at Brindisi in 2009, Enel
Produzione has been charged with administrative liability
for negligent personal injury. The trial in the court of first
instance ended on March 8, 2016 with the acquittal of
the Enel employees and the Company for offenses under
Legislative Decree 231/2001;
> for a fatal accident involving an employee of a subcon-
tractor in Palermo in 2008, Enel Distribuzione has been
charged with administrative liability for manslaughter. The
trial is proceeding.
Basilus litigation
(formerly Meridional) -
Brazil
The Brazilian construction company Basilus S/A Serviço,
Emprendimiento y Participações (formerly Meridional) held
a contract for civil works with the Brazilian company CELF
(owned by the State of Rio de Janeiro), which withdrew from
the contract. As part of its privatization, CELF transferred its
assets to Ampla Energia e Serviços SA (Ampla). In 1998,
Basilus filed suit against Ampla, arguing that the transfer had
infringed its rights and that it had been defrauded.
Ampla obtained favorable judgments in the courts of first
and second instance. Although the second-level decision
was adjudicated Basilus lodged a special appeal (mandado
de segurança) in September 2010 asking for the adverse ru-
ling to be overturned. That request was denied.
Subsequently Basilus lodged a new appeal with the Tribunal
Superior de Justiça, which was denied. Basilius has appea-
led the decision.
The amount involved in the dispute is about R$1,344 million
(about €311 million).
294
Annual Report 2015 CIEN litigation - Brazil
In 1998 the Brazilian company CIEN signed an agreement
with Tractebel for the delivery of electricity from Argentina
through its Argentina-Brazil interconnection line. As a result
of Argentine regulatory changes introduced as a conse-
quence of the economic crisis in 2002, CIEN was unable to
make the electricity available to Tractebel. In October 2009,
Tractebel sued CIEN, which submitted its defense. CIEN ci-
ted force majeure as a result of the Argentine crisis as the
main argument in its defense. Out of court, Tractebel has
indicated that it plans to acquire 30% of the interconnection
line involved in the dispute.
In March 2014, the court granted CIEN’s motion to suspend
the proceedings in view of the existence of other litigation
pending between the parties.
The amount involved in the dispute is estimated at about
R$118 million (about €27 million), plus unspecified dama-
ges.
For analogous reasons, in May 2010 Furnas also filed suit
against CIEN for failure to deliver electricity, requesting
payment of about R$520 million (about €121 million), in ad-
dition to unspecified damages.
In alleging non-performance by CIEN, Furnas is also see-
king to acquire ownership (in this case 70%) of the intercon-
nection line.
CIEN’s defense is similar to the earlier case. The claims put
forth by Furnas were rejected by the trial court in August
2014.
Furnas lodged an appeal against the latter decision and the
proceedings are continuing.
Cibran litigation - Brazil
Companhia Brasileira de Antibióticos (Cibran) has filed a
pla has appealed the ruling and the appeal is under way.
In another pending case, on June 1, 2015, the courts issued
a ruling ordering Ampla to pay R$80,000 (about €18,000)
in non-pecuniary damages as well as R$96,465,103 (about
€22 million) in pecuniary damages on the basis of an expert
appraisal, plus interest. Ampla appealed the decision. The
value of all the disputes is estimated at about R$374 million
(about €86 million).
Coperva litigation - Brazil
As part of the project to expand the grid in rural areas of Bra-
zil, in 1982 Companhia Energética do Ceará SA (“Coelce”),
then owned by the Brazilian government and now an Enel
Group company, had entered into contracts for the use of
the grids of a number of cooperatives established specifical-
ly to pursue the expansion project. The contracts provided
for the payment of a monthly fee by Coelce, which was also
required to maintain the networks.
Those contracts, between cooperatives established in spe-
cial circumstances and the then public-sector company, do
not specifically identify the grids governed by the agree-
ments, which has prompted a number of the cooperatives
to sue Coelce asking for, among other things, a revision
of the fees agreed in the contracts. These actions include
the suit filed by Cooperativa de Eletrificação Rural do V do
Acarau Ltda (Coperva) with a value of about R$179 million
(about €42 million). Coelce was granted rulings in its favor
from the court of first instance and the Court of Appeal, but
Coperva filed a further appeal (Embargo de Aclaración) and
a decision is pending.
El Quimbo (Colombia)
number of suits against Ampla Energia e Serviços SA (Am-
A number of legal actions (“acciones de grupo” and “ac-
pla) to obtain damages for alleged losses incurred as a re-
ciones populares”) brought by residents and fishermen in
sult of the interruption of service by the Brazilian distribution
the affected area are pending with regard to the El Quim-
company. The court ordered a unified technical appraisal for
bo project for the construction of a 400 MW hydroelectric
those cases, the findings of which were partly unfavorable
plant in the region of Huila (Colombia). More specifically,
to Ampla. The latter challenged the findings, asking for a
the first Acción de grupo, currently in the preliminary stage,
new study. The proceedings concerning that petition are
was brought by around 1,140 residents of the municipali-
pending.
ty of Garzón, who claim that the construction of the plant
In September 2014, the court of first instance issued a ru-
would reduce their business revenues by 30%. A second
ling against Ampla in one of the various suits noted above,
action was brought, between August 2011 and December
levying a penalty of about R$200,000 (about €46,000) as
2012, by residents and businesses/associations of five mu-
well as other damages to be quantified at a later stage. Am-
nicipalities of Huila claiming damages related to the closing
295
Consolidated financial statementsAnnual Report 2015 of a bridge (Paso El Colegio). With regard to acciones po-
bian pesos (about €5.5 million).
pulares, or class action lawsuits, in 2008 a suit was filed
by a number of residents of the area demanding, among
other things, that the environmental permit be suspended.
Another Acción popular was brought by a number of fish
farming companies over the alleged impact that filling the
Quimbo basin would have on fishing in the Betania basin
downstream from Quimbo. In February 2015, the Court
ordered the precautionary suspension of filling operations
until a number of specific requirements have been met.
The precautionary suspension was subsequently modified
to permit filling to proceed, which began on June 30, 2015.
However, on July 3, 2015 CAM (the regional environmental
authority) issued a measure (“medida preventiva”) again or-
dering filling operations to be suspended temporarily.
In view of the technical impossibility of suspending filling
operations, on July 17, 2015 Emgesa received a notice mo-
difying the precautionary measure to prohibit generation
activities until ANLA (the national environmental authority)
certifies that the company removed the biomass and forest
waste from the Quimbo reservoir basin.
In September 2015, ANLA issued two reports which in
general confirm that the company had fulfilled the require-
ments. Consequently, on September 21, 2015 the company
asked the court to lift the precautionary suspension. Pen-
ding the ruling, as an energy emergency has been declared,
the Ministry of Energy issued a decree authorizing Emgesa
to begin generation.
On December 16, 2015, the Constitutional Court ruled that
the presidential decree was unconstitutional and as from
that date Emgesa suspended electricity generation.
On December 24, 2015, the Ministero Minas y Energia and
the AUNAP (the authority for agriculture and fishing) filed a
joint motion asking the criminal court to authorize genera-
tion as a precautionary measure. On January 8, 2016, the
court granted the precautionary measure requested by the
Ministry and the AUNAP, authorizing the temporary and im-
mediate resumption of generation at El Quimbo. The pre-
cautionary measure granted by the court would remain in
force until the Huila court issued a ruling on the substance
of the case, i.e. the revocation or upholding of the precautio-
nary measure previously issued by the local administrative
court.
With a decision of February 22, 2016, the Huila court issued
a ruling allowing generation to continue for six months. The
court ordered Emgesa to prepare a technical design that
would ensure compliance with oxygen level requirements
and to provide collateral of about 20,000,000,000 Colom-
296
Nivel de Tensión Uno
proceedings - Colombia
This dispute involves an “acción de grupo” brought by Cen-
tro Médico de la Sabana hospital and other parties against
Codensa seeking restitution of allegedly excess rates. The
action is based upon the alleged failure of Codensa to apply
a subsidized rate that they claim the users should have paid
as Tensión Uno category users (voltage of less than 1 kV)
and owners of infrastructure, as established in Resolution
82/2002, as amended by Resolution 97/2008. The suit is at
a preliminary stage. The estimated value of the proceeding
is about 337,626,840,000 Colombian pesos (about €96 mil-
lion).
SAPE (formerly Electrica)
arbitration proceedings -
Romania
On June 11, 2007, Enel SpA entered into a Privatization Agre-
ement with SC Electrica SA for the privatization of Electrica
Muntenia Sud (“EMS”). The accord provided for the sale
to Enel of 67.5% of the Romanian company. In accordance
with the unbundling rules, in September 2008 the distribu-
tion and electricity sales operations were transferred to two
new companies, Enel Distributie Muntenia (“EDM”) and
Enel Energie Muntenia (“EEM”). In December 2009, Enel
transferred the entire capital of the two companies to Enel
Investment Holding BV (“EIH”).
On July 5, 2013, EMS notified Enel SpA, EIH, EDM and
EEM (limited to a number of claims) of a request for arbi-
tration before the International Chamber of Commerce in
Paris, claiming damages for alleged violations of specific
clauses of the Privatization Agreement.
More specifically, the plaintiff claimed payment of penalties
of about €800 million, plus interest and additional unspeci-
fied damages.
The proceeding is under way. A hearing was held in the first
week of June 2015, with the arbitration ruling expected to
be issued by the end of April 2016.
On September 29, 2014, SAPE notified Enel and Enel In-
vestment Holding that it had submitted a further arbitration
request to the International Court of Arbitration in Paris see-
Annual Report 2015 king around €500 million (plus interest) in connection with
Finally, VV lodged a further suit with the District Court of
the put option contained in the Privatization Agreement.
Bratislava seeking restitution of the fees paid by VV to SE
The put option gives SAPE the right to sell a 13.57% stake
for the transfer of the assets in the privatization. This latter
in Enel Distributie Muntenia and Enel Energie Muntenia.
proceeding has also been suspended pending the decision
The proceeding is under way and a hearing is expected to
in the proceeding undertaken by the PPO.
be held in July 2016.
Gabcˇíkovo dispute -
Slovakia
Slovenské elektrárne (“SE”) is involved in a number of ca-
ses before the national courts concerning the 720 MW
Gabcˇ ikovo hydroelectric plant, which is administered by Vo-
dohospodárska Výsatavba Štátny Podnik (“VV”) and whose
operation and maintenance, as part of the privatization of
SE in 2006, had been entrusted to SE for a period of 30
years under a management agreement (the VEG Operation
Agreement).
Immediately after the closing of the privatization, the Public
Procurement Office (PPO) filed suit with the Court of Brati-
slava seeking to void the VEG Operation Agreement on the
basis of alleged violations of the regulations governing pu-
blic tenders, qualifying the contract as a service contract and
as such governed by those regulations. In November 2011
the court of first instance ruled in favor of SE, whereupon
the PPO appealed the decision.
In parallel with the PPO action, VV also filed a number of su-
its, asking in particular for the voidance of the VEG Operation
Agreement and for SE to pay VV the revenue from the sale
of electricity generated by the plant since 2006.
SE considers the claims of VV to be unfounded and is conte-
sting the various suits, which have been suspended pending
a decision in the proceeding launched by the PPO.
On March 9, 2015, the decision of the appeals court overturned
the ruling of the court of first instance and voided the contract.
SE lodged an extraordinary appeal against that decision and
the request for arbitration with the Vienna International Ar-
bitral Centre (“VIAC”) under the VEG Indemnity Agreement.
Under that accord, which had been signed as part of the pri-
vatization between the National Property Fund of the Slovak
Republic and SE, the latter is entitled to an indemnity in the
event of the early termination of the VEG Operation Agree-
ment for reasons not attributable to SE.
In April 2015, SE had also received a notice from VV deman-
ding payment of about €490 million for alleged unjustified
enrichment from the operation of the plant in 2006-2015. SE
rejected the demand.
Dispute between Energia
XXI Energias Renováveis
e Consultoria Limitada
and Enel Green Power
España
In 1999 Energia XXI filed for arbitration against MADE (now
Enel Green Power España) for alleged losses incurred due
to the early termination of an agency contract for the sale
of wind generators and wind farms of Enel Green Power
España in Portugal and Brazil. With its ruling of November
21, 2000, the arbitration board found that the termination of
the contract by MADE was illegitimate and ordered it to pay:
(i) legal costs; (ii) the fixed portion of the monthly fee for the
period from July 21, 1999 (date of termination of contract)
to October 9, 2000 (expiration date of the contract), equal to
about €50,000; (iii) lost profits to be determined in respect
of contracts for at least 15 MW of capacity. Following the
arbitration ruling, two civil court cases began:
> the first appeal was lodged by MADE with the Tribunal
Judicial de Primera Instancia asking for the arbitration
ruling to be voided. The case is still pending with the
court of first instance following referral by the Court of
Appeal (subsequently confirmed by the Supreme Court
of Appeal on September 26, 2013), which granted Enel
Green Power España’s appeal of the admission of briefs.
Following questioning of the witnesses of the two par-
ties, the Tribunal Judicial de Primera Instancia moved to
the judgement stage;
> the second appeal was lodged by Energia XXI on May 9,
2006, with the Civil Court of Lisbon, with which Energia
XXI asked for Enel Green Power España to be ordered
to pay the amount determined in the arbitration ruling
(the losses for which Energia XXI now puts at €546 mil-
lion). Enel Green Power España considers the claim to
be unfounded. Acting on a petition by Enel Green Power
España, the court has so far suspended the case pen-
ding resolution of the first suit.
297
Consolidated financial statementsAnnual Report 2015 CIS and Interporto
Campano
authorities considered this financing to be the equivalent of
the early extinguishment of the bond, with the consequent
loss of entitlement to the exemption from withholding tax.
In December 2005, Ampla Energia e Serviços SA carried out
On December 4, 2009 and August 4, 2010 Enel Green
a spin-off in favor of Ampla Investimentos e Serviços SA that
Power SpA signed, with Interporto Campano and Centro
involved the transfer of the residual FRN debt and the asso-
Ingrosso Sviluppo Campania Gianni Nappi SpA (“CIS”), re-
ciated rights and obligations.
spectively, a leasehold agreement with a term of more than
On November 6, 2012, the Camara Superior de Recursos
nine years and a leasehold estate for the rooftops of the
Fiscales (the highest level of administrative courts) issued a
industrial sheds of the CIS and Interporto Campano in order
ruling against Ampla, for which the company promptly asked
to build and operate a photovoltaic plant. Two fires subse-
that body for clarifications. On October 15, 2013, Ampla was
quently broke out at those sheds: the first occurred on April
notified of the denial of the request for clarification (“Embar-
22, 2011, during the construction of the plant, while the
go de Declaración”), thereby upholding the previous adverse
second broke out on March 26, 2012.
decision. The company provided security for the debt and on
Following the fires, CIS undertook two arbitration procee-
June 27, 2014 continued litigation before the ordinary courts
dings, on November 3, 2012 and May 23, 2014, respec-
(“Tribunal de Justiça”).
tively, with the latter undertaken together with Interporto
The amount involved in the dispute at December 31, 2015
Campano.
was about €262 million.
In the arbitration ruling filed on January 31, 2015, the ru-
ling of the arbitration board in the first proceeding found
In 2002, the State of Rio de Janeiro changed the deadlines
against the contractor as well as contributory negligence
for payment of the ICMS (Imposto sobre Circulação de Mer-
on the part of both CIS and Enel Green Power (“EGP”),
cadorias and Serviços) by withholding agents (to the 10th,
ordering EGP to pay CIS about €2.5 million, equal to half
20th and 30th of each month – Ley Benedicta). Owing to
of the damages originally admitted for indemnification. In
liquidity problems, between September 2002 and Februa-
the second arbitration proceeding, CIS and Interporto Cam-
ry 2005, Ampla Energia e Serviços continued to pay the
pano sought the termination of the leasehold estate and
ICMS in compliance with the previous system (the 5th day
the more-than-9-year lease as well as damages for alleged
of the subsequent month). Despite an informal agreement,
losses following breaches by EGP quantified in the amount
the Brazilian tax authorities issued an assessment for late
of about €65 million, of which about €35 million for costs
payment of the ICMS (“multa de demora”). Ampla appea-
incurred in dismantling the photovoltaic plants. EGP asked
led the measure (the highest level of administrative courts),
for the suits to be dismissed and filed a counter-claim for
arguing that the penalties imposed were not due owing to
damages of about €40 million. The proceeding is at a pre-
the application of a number of amnesties granted between
liminary stage.
Tax litigation in Brazil
2004 and 2006. On October 25, 2015, Ampla filed the ruling
issued by the Supreme Court of Brasilia (published on Octo-
ber 2, 2015 and not contested by the tax authorities), which
in granting the appeal of Ampla ruled that the change in the
deadlines for the payment of the ICMS was unconstitutional.
In 1998, Ampla Energia e Serviços SA (Ampla) financed the
The amount involved in the dispute at December 31, 2015
acquisition of Coelce with the issue of bonds in the amount
was about €66 million.
of $350 million (“Fixed Rate Notes” - FRN) subscribed by
its Panamanian subsidiary, which had been established to
The States of Rio de Janeiro and Ceará issued a number of
raise funds abroad. Under the special rules then in force,
tax assessments against Ampla Energia e Serviços (for the
subject to maintaining the bond until 2008, the interest paid
years 1996-1999 and 2007-2012) and Companhia Energética
by Ampla to its subsidiary was not subject to withholding
do Ceará (for the years 2003, 2004 and 2006-2009), chal-
tax in Brazil.
lenging the deduction of ICMS in relation to the purchase
However, the financial crisis of 1998 forced the Panamanian
of certain non-current assets. In March 2015, new asses-
company to refinance itself with its Brazilian parent, which
sments were issued (for 2010 and for the period from 2012
for that purpose obtained loans from local banks. The tax
to July 2014) with a value of about €8 million. The companies
298
Annual Report 2015 challenged the assessments, arguing that they correctly de-
application of the accounting standards it had adopted. The
ducted the tax and asserting that the assets, the purchase
Brazilian tax authorities, however, asserted – during an au-
of which generated the ICMS, are intended for use in their
dit – that the accounting treatment was incorrect and that
electricity distribution activities. One of the administrative
the effects of the cancellation should have been recognized
proceedings ended with a ruling partially in Ampla’s favor,
through profit or loss. As a result, the corresponding value
with a reduction in the amount due to the tax authorities.
(about €202 million) was reclassified as a payment of inco-
Ampla has appealed the remainder.
me to non-residents and, therefore, subject to withholding
The amount involved in the disputes totaled approximately
tax of 15%.
€47 million at December 31, 2015.
On December 2, 2014, the company appealed the initial ru-
ling, arguing that its accounting treatment was correct. It
On November 4, 2014, the Brazilian tax authorities issued an
should be noted that the accounting treatment adopted by
assessment against Endesa Brasil SA (now Enel Brasil SA)
the company was agreed with the external auditor and also
alleging the failure to apply withholding tax to payments of
confirmed by a specific legal opinion issued by a local firm
allegedly higher dividends to non-resident recipients.
specializing in corporate law.
More specifically, in 2009, Endesa Brasil, as a result of the
The overall amount involved in the dispute at December 31,
first-time application of the IFRS-IAS, had cancelled goodwill,
2015 was about €54 million.
recognizing the effects in equity, on the basis of the correct
50. Events after the reporting period
Integration with Enel
Green Power
shares they hold in EGP with Enel shares; and
> Enel will exchange the shares corresponding to its stake
in the spun-off assets with Enel shares, which will be im-
mediately cancelled in accordance with Article 2504-ter,
On January 11, 2016, the Extraordinary Shareholders’ Mee-
paragraph 2, and Article 2506-ter, paragraph 5, of the Ita-
ting of Enel SpA (“Enel”) approved the partial non-proportio-
lian Civil Code.
nal spin-off of Enel Green Power SpA (“EGP”) into Enel (the
The Spin-Off will be carried out on the basis of an exchange
“Spin-Off”). Prior to the Enel Meeting on the same date, the
ratio of 0.486 newly issued Enel shares for each EGP share
Extraordinary Shareholders’ Meeting of EGP also approved
tendered for exchange, with no cash adjustment. As a re-
the Spin-Off. More specifically, the Extraordinary Sharehol-
sult, as of the effective date of the Spin-Off, EGP will reduce
ders’ Meeting of Enel approved, without amendment or ad-
its share capital by an amount equal to the value of the spun-
dition, the spin-off project, which envisages:
off assets, while Enel will increase its share capital to serve
> the assignment by EGP to Enel of the spun-off assets, es-
the Spin-Off. Enel will issue up to 770,588,712 new shares
sentially represented by: (i) the 100% stake held by EGP
– which will rank for dividend pari passu and with a par value
in Enel Green Power International, a Dutch holding com-
of €1.00 each – to be assigned to minority shareholders of
pany that holds investments in companies operating in
EGP in accordance with the exchange ratio.
the renewable energy sector in North, Central and South
The shareholders of EGP that do not approve the Spin-Off
America, Europe, South Africa and India; and (ii) the as-
will be entitled to exercise the right of withdrawal pursuant
sets, liabilities, contracts and other legal relationships as-
to Article 2437, paragraph 1, letter a) of the Italian Civil Code
sociated with those investments; and
(the “Right of Withdrawal”), or the right to have their EGP
> the retention by EGP of all remaining assets and liabilities
shares purchased by Enel pursuant to Article 2506-bis, pa-
other than those that are part of the spun-off assets (and
ragraph 4, of the Italian Civil Code (the “Right of Sale”). The
thus, essentially, all Italian operations and a small number
Right of Withdrawal and the Right of Sale may be exercised
of remaining foreign investments).
at the unit settlement value for EGP shares, determined in
Since the transaction involves a non-proportional spin-off, it
accordance with Article 2437-ter, paragraph 3, of the Italian
envisages that:
Civil Code, which is equal to €1.780 per EGP share. At the
> shareholders of EGP other than Enel may exchange all the
end of the offer period, those rights had been validly exer-
299
Consolidated financial statementsAnnual Report 2015 cised for 16,406,123 ordinary shares of EGP for an aggre-
gate amount of €29.2 million. The shares represent around
0.33% of EGP’s share capital. The total value of the shares
involved is therefore below the threshold of €300 million, set
as a condition for the completion of the Spin-Off.
The shares were offered on an optional pre-emption basis to
the shareholders of EGP pursuant to Article 2437-quater of
the Italian Civil Code, from February 19, 2016 to March 21,
2016 inclusive. Enel announced its intention to fully exercise
the option right for the purchase of the shares it is entitled
to, as well as to exercise the right of pre-emption for any
shares unsold pursuant to Article 2437-quater, paragraph 3,
of the Italian Civil Code. The effectiveness of the Right of
Withdrawal and the Right of Sale and therefore the settle-
ment procedure for the shares, as well as the completion of
the offer on an optional pre-emption basis are subject to the
completion of the Spin-Off, which is expected to occur by
the end of the 1st Quarter of 2016.
The Spin-Off will take statutory effect as from the last of
the registrations of the Spin-Off instrument with the Rome
Company Register; as from the same date, transactions in-
volving the spun-off assets will be recognized in the Enel
financial statements, with the start of accounting and tax
effects. Subject to the condition precedent specified above,
the closing of the Spin-Off is scheduled to take place by the
end of the 1st Quarter of 2016.
Bond buy-back
Framework agreement
with Bank of China and
SINOSURE
On January 20, 2016, Enel, Bank of China (a leader in the
Chinese banking sector as well as the most internationali-
zed and diversified bank in China), and the China Export &
Credit Insurance Corporation (“SINOSURE”) signed a non-
binding framework agreement to promote the development
by Enel Group companies, in particular Enel Green Power,
of projects on a worldwide basis with the participation of
Chinese companies acting as engineering, procurement and
construction contractors and/or suppliers. Under the agre-
ement, Bank of China will provide Enel and its subsidiaries
with a credit line of up to $1 billion backed by SINOSURE.
The framework agreement, which provides the main terms
and conditions of the facilities that can be granted, will re-
main in force for a period of five years, with the possibility of
extension if mutually agreed by the parties.
Enel’s new corporate
identity
On January 26, 2016, the Group’s new corporate identity
was unveiled at the headquarters of the Endesa subsidiary
in Madrid. On the same occasion, the new logos of Enel
Green Power and Endesa were also revealed within the con-
On January 14, 2016, within the framework of its program
text of the new identity.
to optimize its liability structure through active management
The new identity represents the pursuit of the “Open Po-
of maturities and the cost of funding, Enel launched a non-
wer” strategy announced last November in London on the
binding voluntary offer to repurchase in cash up to a nominal
occasion of Enel’s Capital Markets Day. It is founded on
€500,000,000 of two series of bonds previously issued by
openness as the keystone of the strategic and operational
Enel itself. At the end of the offer period (January 20, 2016)
approach of the Group. More specifically, “Open Power”
Enel decided to exercise the option envisaged in the offer
seeks to:
documentation to increase the original nominal amount in-
> open access to electricity for more people;
volved in the buy-back and so decided to purchase:
> open the world of energy to new technology;
> a nominal €591,088,000 of bonds maturing on June 20,
> open energy management to individuals;
2017, following the application of the allotment ratio of
> open power to new uses;
92.5715%;
> open up to more partnerships.
> a nominal €158,919,000 of bonds maturing on June 12,
The new brand strategy transmits the image of Enel as a
2018, following the application of the allotment ratio of
modern, open, flexible, responsive utility capable of leading
100%.
the energy transition. The Group has introduced a colorful
The settlement date of the offer was January 25, 2016.
new visual system – which includes the logos – that reflects
the flexible and dynamic principles of “Open Power”. The
new visual identity and the new logo are composed of a rich
300
Annual Report 2015 palette of color to reflect the variety of the energy spectrum,
Planners, Landscape Architects and Conservators. The me-
the multifaceted nature of a Group present in more than 30
morandum is intended to promote the energy upgrading
countries and the growing diversification of the services we
of buildings and the architectural quality of the solutions. It
offer in a global energy system.
also seeks to foster joint policies and actions and propose
The brand renewal also included the unveiling of the new
legislation to raise the quality of the installation of efficient
website enel.com, a site focused on users and access
technologies, ensure environmental benefits and dignity
via mobile applications. During 2016, the updating of the
and, at the same time, generate savings for the public. The
Group’s entire online presence will be completed.
memorandum sets out a collaborative program to encoura-
Start-up program in
Israel
On February 10, 2016, Enel announced the launch of a techno-
logical support program for start-ups in Israel, a country with
such a high concentration of innovative tech companies that
it boasts its own version of Silicon Valley, called Silicon Wadi.
As part of the program, Enel will create a company to sup-
port start-ups, acting as a business incubator headquartered
in Tel Aviv. It is scheduled to open its doors in May. Each year,
up to eight start-ups will be selected from among key local
companies, which will be able to benefit from a customized
support program in collaboration with Enel.
One of the program’s objectives – in addition to developing
individual start-ups – is to establish a presence in Israel’s in-
novation ecosystem, one of the most advanced in the world,
leveraging venture capital funds, universities and a collabo-
ration with the Office of the “Chief Scientist“ of Israel’s Mi-
nistry of the Economy.
The support company with select the start-ups using public
tenders for projects based on Enel’s broad range of techno-
logical priorities. Once selected the start-ups will have ac-
cess to Enel engineers and technology experts, who will
help them develop their business and their technology, using
company facilities for testing and leveraging the Group’s
commercial and technological experience. Each project will
receive support for at least six months.
Memorandum of
understanding between
architects and Enel
Energia
ge and develop approaches to integration and cooperation.
Enel Energia will provide Italian architects with permanent
ongoing training initiatives – compliant with the rules gover-
ning life-long training of the National Council of Architects –
in order to keep them up to date on innovation in efficient re-
sidential technologies, their characteristics, benefits and key
installation and permitting issues. The underlying principle of
the agreement is that training and research are priority stra-
tegic factors for growth and progress, and so it is necessary
to invest in the sector in a manner adequate to the needs of
the society and economy of local communities.
Enel Green Power wins
renewables tender in
Peru
On February 18, 2016, Enel Green Power (“EGP”), acting
through its subsidiary Enel Green Power Perú, was awar-
ded the right to sign 20-year energy supply contracts for 126
MW wind power, 180 MW solar PV and 20 MW of hydro
capacity following the renewables tender launched by the
Peruvian government through the energy regulator OSI-
NERGMIN. With 326 MW awarded in the tender, EGP will
become by 2018 the main renewable player in Peru and the
only company operating plants of three different renewable
technologies in the country.
EGP will be investing about $400 million in the construc-
tion of the renewables facilities, which are expected to enter
into operation by 2018, in line with the investments outlined
in the company’s current strategic plan. The 20-year supply
contracts awarded to EGP provide for the sale of specified
volumes of energy generated by the plants. Nazca wind
project will be built in the Marcona district, which is located
in Peru’s southern coastal area, more specifically in the Ica
department, an area blessed by high level of wind resources.
This project, with a total installed capacity of 126 MW, once
On February 17, 2016, Enel Energia signed a memorandum
up and running, will generate about 600 GWh per year, while
of understanding with the National Council of Architects,
avoiding the emission of around 370,000 metric tons of CO2
301
Consolidated financial statementsAnnual Report 2015 into the atmosphere. The 180 MW Rubi photovoltaic project
will be built in the Moquegua district, which is located in
Peru’s southern area, more specifically in the Moquegua de-
partment, an area which enjoys high levels of solar radiation.
Once up and running, the solar facility will generate approxi-
mately 440 GWh per year, avoiding the emission of around
270,000 metric tons of CO2 into the atmosphere. The hydro
project Ayanunga, whose capacity amounts to an approxi-
mate 20 MW, will be built in the Monzón district, which is
located in Peru’s central area, more specifically in the Huánu-
co department. Once up and running, the hydro plant will ge-
nerate annually about 140 GWh, while avoiding the emission
of around 109,000 metric tons of CO2 into the atmosphere.
Disposal of Hydro
Dolomiti Enel
On February 29, 2016, the sale by the subsidiary Enel Produ-
zione entire 49% stake in Hydro Dolomiti Enel Srl (“HDE”)
to Fedaia Holdings Sàrl (“Fedaia”), a Luxembourg-based
subsidiary of Macquarie European Infrastructure Fund 4
(“MEIF4”), was completed. The price for the sale was fina-
lized at €335.4 million, in line with the agreement signed
on November 13, 2015 between Enel Produzione and Fe-
daia. Enel Produzione’s stake in HDE was sold to the Italian
company Fedaia Investments Srl, which was designated as
the purchaser by Fedaia and is also controlled by MEIF4. The
completion of the transaction follows clearance from the EU
Antitrust Authority, which was the final outstanding condi-
tion precedent provided for in the sale agreement.
302
Annual Report 2015 303
Consolidated financial statementsAnnual Report 2015 Declaration of the Chief Executive
Officer and the officer responsible
for the preparation of corporate
financial reports
304
Annual Report 2015 Declaration of the Chief Executive Officer and the officer responsible for the preparation
of the consolidated financial report of the Enel Group at December 31, 2015, pursuant to
the provisions of Article 154-bis, paragraph 5, of Legislative Decree 58 of February 24, 1998
and Article 81-ter of CONSOB Regulation 11971 of May 14, 1999
1. The undersigned Francesco Starace and Alberto De Paoli, in their respective capacities as Chief Executive Officer and
officer responsible for the preparation of the financial reports of Enel SpA, hereby certify, taking account of the provisions
of Article 154-bis, paragraphs 3 and 4, of Legislative Decree 58 of February 24, 1998:
a. the appropriateness with respect to the characteristics of the Enel Group and
b. the effective adoption of the administrative and accounting procedures for the preparation of the consolidated financial
statements of the Enel Group in the period between January 1, 2015 and December 31, 2015.
2. In this regard, we report that:
a. the appropriateness of the administrative and accounting procedures used in the preparation of the consolidated
financial statements of the Enel Group has been verified in an assessment of the internal control system for financial
reporting. The assessment was carried out on the basis of the guidelines set out in the “Internal Controls - Integrated
Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO);
b. the assessment of the internal control system for financial reporting did not identify any material issues.
3. In addition, we certify that consolidated financial statements of the Enel Group at December 31, 2015:
a. have been prepared in compliance with the international accounting standards recognized in the European Union
pursuant to Regulation 2002 /1606/EC of the European Parliament and of the Council of July 19, 2002;
b. correspond to the information in the books and other accounting records;
c. provide a true and fair representation of the performance and financial position of the issuer and the companies
included in the scope of consolidation.
4. Finally, we certify that the report on operations, included in the Annual Report 2015 and accompanied by the consolidated
financial statements of the Enel Group at December 31, 2015, contains a reliable analysis of operations and performance,
as well as the situation of the issuer and the companies included in the scope of consolidation, together with a description
of the main risks and uncertainties to which they are exposed.
Rome, March 22, 2016
Francesco Starace
Alberto De Paoli
Chief Executive Officer of Enel SpA
Officer responsible for the preparation
of corporate financial reports
Declaration of the Chief Executive Officer and the officer responsible
305
Annual Report 2015 Separate financial statements
of Enel SpA
306
Annual Report 2015 307
Separate financial statements of Enel SpAAnnual Report 2015 Financial statements
Income statement
Euro
Revenue
Revenue from sales and services
Other revenue and income
Costs
Consumables
Services, leases and rentals
Personnel
Depreciation, amortization and impairment losses
Other operating expenses
Operating income
Income from equity investments
Financial income from derivatives
Other financial income
Financial expense from derivatives
Other financial expense
Income before taxes
Income taxes
NET INCOME FOR THE YEAR
Notes
4.a
4.b
2015
2014
of which with
related parties
of which with
related parties
237,437,374
237,707,512
244,732,151
244,663,410
7,705,720
6,409,403
920,520
92,914
[Subtotal]
245,143,094
245,652,671
5.a
5.b
5.c
5.d
5.e
1,570,962
1,426,297
199,160,903
72,721,157
184,864,554
57,699,240
175,679,876
327,066,874
119,589,202
543,329,226
(32,288)
23,773,659
272,708
19,256,153
(317,979)
[Subtotal]
727,252,274
(482,109,180)
868,465,432
(622,812,761)
6
7
8
7
8
2,024,387,668
2,024,387,668
1,818,272,847
1,818,272,847
3,357,787,018
499,950,787
2,190,314,832
459,596,620
177,252,784
160,415,399
221,643,785
194,191,141
3,024,073,367
2,248,211,467
1,954,373,400
1,169,367,271
1,243,796,482
1,353,550
1,377,093,325
3,142,675
[Subtotal]
1,291,557,621
809,448,441
9
(201,206,058)
1,010,654,499
898,764,739
275,951,978
(282,250,536)
558,202,514
308
Annual Report 2015 Statement of comprehensive income
for the year
Euro
Notes
2015
2014
Net income for the year
1,010,654,499
558,202,514
Other comprehensive income recyclable to profit or loss
Effective portion of change in the fair value of cash flow hedges
Income/(Loss) recognized directly in equity recyclable to profit or loss
Other comprehensive income not recyclable to profit or loss
55,191,519
(73,365,668)
55,191,519
(73,365,668)
Remeasurements of employee benefit liabilities
(6,262,322)
7,140,604
Income/(Loss) recognized directly in equity not recyclable
to profit or loss
Income/(Loss) recognized directly in equity
(6,262,322)
7,140,604
22
48,929,197
(66,225,064)
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR
1,059,583,696
491,977,450
309
Separate financial statements of Enel SpAAnnual Report 2015 Notes
10
11
12
13
14
15
16
at Dec. 31, 2015
at Dec. 31, 2014
of which with
related parties
of which with
related parties
7,318,430
13,979,194
372,601,084
7,795,187
11,405,854
382,572,824
38,984,404,315
38,754,068,086
2,590,475,105
317,479,879
1,979,171,296
818,817,602
107,178,537
71,448,713
146,490,819
116,989,366
409,088,037
164,342,076
466,782,285
176,864,784
[Subtotal]
42,485,044,702
41,748,286,351
283,402,770
277,741,015
131,944,125
126,901,064
319,245,633
624,614,245
298,808,858
25,645,428
280,273,785
50,482,464
3,402,558,948
3,130,256,153
5,040,376,082
4,222,947,341
459,912,939
421,632,813
243,507,371
208,144,734
17
18
14
19
20
21
5,925,363,202
[Subtotal]
10,689,292,350
53,174,337,052
6,972,042,465
13,292,758,073
55,041,044,424
Balance sheet
Euro
ASSETS
Non-current assets
Property, plant and equipment
Intangible assets
Deferred tax assets
Equity investments
Derivatives
Other non-current financial assets
Other non-current assets
Current assets
Trade receivables
Tax receivables
Derivatives
Other current financial assets
Other current assets
Cash and cash equivalents
TOTAL ASSETS
310
Annual Report 2015 9,403,357,795
9,113,576,853
6,061,293,373
558,202,514
25,136,430,535
17,287,754,222
301,792,836
16,242,515
251,979,935
Euro
Notes
LIABILITIES AND SHAREHOLDERS’ EQUITY
at Dec. 31, 2015
at Dec. 31, 2014
of which with
related parties
of which with
related parties
Shareholders’ equity
Share capital
Reserves
Retained earnings/(Loss carried forward)
Profit for the period
9,403,357,795
9,162,506,050
5,303,025,796
1,010,654,499
TOTAL SHAREHOLDERS’ EQUITY
22
24,879,544,140
Non-current liabilities
Long-term borrowings
Employee benefits
Provisions for risks and charges
Deferred tax liabilities
Derivatives
Other non-current liabilities
Current liabilities
Short-term borrowings
Current portion of long-term borrowings
Trade payables
Derivatives
Other current financial liabilities
Other current liabilities
14,502,714,348
290,995,396
53,892,853
290,738,493
23
24
25
12
14
26
2,716,865,899
1,364,781,681
2,483,607,608
469,314,078
243,205,378
242,742,934
286,974,494
286,925,885
[Subtotal]
18,098,412,367
20,628,351,610
23
23
27
14
28
30
4,914,568,035
3,243,027,360
4,745,815,106
4,319,403,537
3,061,764,326
2,362,593,688
164,019,523
59,244,803
138,773,087
54,531,005
366,838,872
275,854,022
359,151,436
233,714,323
642,802,743
83,534,943
694,402,099
54,139,432
1,046,387,046
354,456,409
975,526,863
396,492,507
TOTAL LIABILITIES
TOTAL LIABILITIES AND SHAREHOLDERS’
EQUITY
[Subtotal]
10,196,380,545
28,294,792,912
9,276,262,279
29,904,613,889
53,174,337,052
55,041,044,424
311
Separate financial statements of Enel SpAAnnual Report 2015 Statement of changes in shareholders’
equity
Euro
At January 1, 2014
Other changes
Allocation of 2013 net income:
- dividends
- legal reserve
- retaining earnings
Comprehensive income for the year:
- income/(loss) recognized directly in
equity
- net income for the year
At December 31, 2014
At January 1, 2015
Other changes
Allocation of 2014 net income:
- dividends
- legal reserve
- retaining earnings
Comprehensive income for the year:
- income/(loss) recognized directly in
equity
- net income for the year
Share capital and reserves (note 22)
Share capital
Share premium reserve
Legal reserve
Reserve pursuant to Law
292/1993
net employee benefit
measurement of financial
Retained earnings/(Loss
Total shareholders’
liabilities/(assets)
instruments
carried forward) Net income for the year
9,403,357,795
5,292,076,658
1,880,671,559
2,215,444,500
68,241,934
(16,808,984)
(259,825,692)
5,911,368,935
1,372,360,952
25,866,887,657
Reserve from
remeasurement of
Reserve from
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
9,403,357,795
9,403,357,795
5,292,076,658
5,292,076,658
1,880,671,559
1,880,671,559
2,215,444,500
2,215,444,500
68,243,876
68,243,876
(9,668,380)
(9,668,380)
(333,191,360)
(333,191,360)
6,061,293,373
6,061,293,373
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Other
sundry
reserves
1,942
-
-
-
-
-
-
-
-
-
-
-
7,140,604
(73,365,668)
-
-
-
-
-
-
-
-
-
-
(1,222,436,514)
(1,222,436,514)
149,924,438
(149,924,438)
558,202,514
558,202,514
558,202,514
(66,225,064)
558,202,514
25,136,430,535
25,136,430,535
(846,302,202)
(470,167,889)
(1,316,470,091)
88,034,625
(88,034,625)
equity
1,942
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(6,262,322)
55,191,519
1,010,654,499
1,010,654,499
48,929,197
Total at December 31, 2015
9,403,357,795
5,292,076,658
1,880,671,559
2,215,444,500
68,243,876
(15,930,702)
(277,999,841)
5,303,025,796
1,010,654,499
24,879,544,140
312
Annual Report 2015 Euro
At January 1, 2014
Other changes
- dividends
- legal reserve
- retaining earnings
Allocation of 2013 net income:
Comprehensive income for the year:
- income/(loss) recognized directly in
equity
- net income for the year
At December 31, 2014
At January 1, 2015
Other changes
Allocation of 2014 net income:
- dividends
- legal reserve
- retaining earnings
Comprehensive income for the year:
- income/(loss) recognized directly in
equity
- net income for the year
9,403,357,795
9,403,357,795
5,292,076,658
5,292,076,658
1,880,671,559
1,880,671,559
2,215,444,500
2,215,444,500
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Share capital and reserves (note 22)
Share capital
Share premium reserve
Legal reserve
292/1993
Reserve pursuant to Law
Other
sundry
reserves
Reserve from
remeasurement of
net employee benefit
liabilities/(assets)
Reserve from
measurement of financial
instruments
Retained earnings/(Loss
carried forward) Net income for the year
Total shareholders’
equity
9,403,357,795
5,292,076,658
1,880,671,559
2,215,444,500
68,241,934
(16,808,984)
(259,825,692)
5,911,368,935
1,372,360,952
25,866,887,657
1,942
-
-
-
-
-
68,243,876
68,243,876
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,942
(1,222,436,514)
(1,222,436,514)
-
-
-
149,924,438
(149,924,438)
-
-
-
7,140,604
(73,365,668)
-
(9,668,380)
(9,668,380)
-
(333,191,360)
(333,191,360)
-
-
-
-
-
-
-
-
-
-
6,061,293,373
6,061,293,373
-
-
558,202,514
558,202,514
558,202,514
-
(66,225,064)
558,202,514
25,136,430,535
25,136,430,535
-
(846,302,202)
(470,167,889)
(1,316,470,091)
-
-
88,034,625
(88,034,625)
-
-
(6,262,322)
55,191,519
-
-
-
-
-
48,929,197
1,010,654,499
1,010,654,499
Total at December 31, 2015
9,403,357,795
5,292,076,658
1,880,671,559
2,215,444,500
68,243,876
(15,930,702)
(277,999,841)
5,303,025,796
1,010,654,499
24,879,544,140
313
Separate financial statements of Enel SpAAnnual Report 2015 Statement of cash flows
Euro
Notes
Income before taxes
Adjustments for:
Amortization and impairment losses of intangible
assets and property, plant and equipment
Exchange rate adjustments of foreign currency
assets and liabilities
Accruals to provisions
Dividends from subsidiaries, associates and other
companies
2015
of which with
related parties
2014
of which with
related parties
809,448,441
275,951,978
5.d
12,603,102
11,703,869
274,383,043
49,937,771
287,123,443
24,534,294
6
(2,024,387,668)
(2,024,387,668)
(1,818,272,847)
(1,818,272,847)
Net financial (income)/expense
452,404,251
1,589,198,831
623,640,479
524,292,099
(Gains)/Losses from disposals and other non-
monetary items
Cash flows from operating activities before
changes in net current assets
Increase/(Decrease) in provisions
314,602,481
535,184,427
(111,008,579)
(28,744,537)
(60,134,357)
(55,266,390)
(Increase)/Decrease in trade receivables
17
(151,458,645)
(150,839,951)
84,189,474
82,062,633
(Increase)/Decrease in financial and non-financial
assets/liabilities
402,341,325
(414,927,710)
54,102,343
(233,456,295)
Increase/(Decrease) in trade payables
27
25,246,436
4,713,798
(73,343,882)
(27,896,752)
Interest income and other financial income collected
1,778,925,604
827,993,050
774,010,519
470,312,293
Interest expense and other financial expense paid
(2,528,964,520)
(764,118,403)
(1,369,270,987)
(148,092,677)
Dividends from subsidiaries, associates and other
companies
Income taxes paid (consolidated taxation mechanism)
Cash flows from operating activities (a)
Investments in property, plant and equipment and
intangible assets
Disposals of property, plant and equipment and
intangible assets
Investments in entities
Disposals of equity investments
Cash flows from investing/disinvesting
activities (b)
Financial debt (new long-term borrowing)
Financial debt (repayments and other net changes)
Net change in long-term financial payables/
(receivables)
Net change in short-term financial payables/
(receivables)
Dividends paid
Cash flows from financing activities (c)
Increase/(Decrease) in cash and cash equivalents
(a+b+c)
Cash and cash equivalents at the beginning of the
year
Cash and cash equivalents at the end of the year
6
2,024,387,668
2,024,387,668
1,818,272,847
1,818,272,847
(348,876,817)
1,061,847,935
(246,793,145)
925,766,422
10-11
(14,699,685)
(14,419,589)
(10,940,364)
(10,406,565)
10-11
-
-
13
13
23
23
(546,800,000)
(546,800,000)
(200,000)
(200,000)
1,861,291
1,861,291
-
(559,638,394)
-
(2,394,106,607)
(11,140,364)
1,602,264,514
(1,103,409,596)
(346,634,658)
45,540,653
(974,482,447)
2,508,323,348
(15,837,605)
4,632,587,974
2,682,474,947
22
(1,316,470,887)
(1,548,888,804)
(1,222,435,833)
2,934,524,612
(1,046,679,263)
3,849,150,670
21
21
6,972,042,465
5,925,363,202
3,122,891,795
6,972,042,465
314
Annual Report 2015 Notes to the separate financial
statements
1
Form and content of the
financial statements
Company, directly and through Enel Insurance NV, provides
insurance coverage.
As the Parent Company, Enel SpA has prepared the conso-
lidated financial statements of the Enel Group for the year
ending December 31, 2015, which form an integral part of
this Annual Report pursuant to Article 154-ter, paragraph 1,
of the Consolidated Law on Financial Intermediation (Legi-
Enel SpA is a corporation (società per azioni) that operates in
slative Decree 58 of February 24, 1998).
the electricity and gas sector and has its registered office in
Viale Regina Margherita 137, Rome, Italy.
On March 22, 2016, the Board of Directors authorized the pu-
In its capacity as holding company, Enel SpA sets the strategic
blication of these financial statements at December 31, 2015.
objectives for the Group and its subsidiaries and coordinates
These financial statements have undergone statutory audi-
their activities. The activities that Enel SpA performs in respect
ting by Reconta Ernst & Young SpA.
of the other Group companies as part of its management and
coordination function, including with regard to the Company’s
organizational structure, can be summarized as follows:
Basis of presentation
> Holding company functions, associated with the coordi-
The separate financial statements for the year ended De-
nation of governance processes at the Group level:
cember 31, 2015 have been prepared in accordance with
- Administration, Finance and Control;
international accounting standards (International Accounting
- Human Resources and Organization;
Standards - IAS and International Financial Reporting Stan-
- Communications;
- Legal and Corporate Affairs;
-
Innovation and Sustainability;
- European Affairs;
- Audit.
dards - IFRS) issued by the International Accounting Stan-
dards Board (IASB), the interpretations of the International Fi-
nancial Reporting Interpretations Committee (IFRIC) and the
Standing Interpretations Committee (SIC), recognized in the
European Union pursuant to Regulation 2002/1606/EC and in
effect as of the close of the year. All of these standards and
> Global business line functions, which are responsible
interpretations are hereinafter referred to as the “IFRS-EU”.
for coordination and development of their business in all
The financial statements have also been prepared in confor-
the geographical areas in which the Group operates:
mity with measures issued in implementation of Article 9,
- Global Infrastructure and Networks;
paragraph 3, of Legislative Decree 38 of February 28, 2005.
- Global Generation.
The financial statements consist of the income statement,
the statement of comprehensive income, the balance sheet,
> Global service functions, which are responsible at the
the statement of changes in shareholders’ equity and the sta-
Group level for coordinating all information technology
tement of cash flows and the related notes.
and purchasing activities:
- Global Purchasing;
- Global ICT.
The assets and liabilities reported in the balance sheet are clas-
sified on a “current/non-current basis”, with separate reporting
of assets held for sale and liabilities included in disposal groups
held for sale, if any. Current assets, which include cash and cash
Enel SpA performs, both directly and through the subsidia-
equivalents, are assets that are intended to be realized, sold or
ry Enel Finance International NV, a centralized treasury fun-
consumed during the normal operating cycle of the Company
ction for the Group (with the exception of the Endesa and
or in the 12 months following the close of the financial year;
Enersis Groups), thereby ensuring that the companies have
current liabilities are liabilities that are expected to be settled
access to the money and capital markets. Furthermore, the
during the normal operating cycle of the Company or within the
315
Separate financial statements of Enel SpAAnnual Report 2015 12 months following the close of the financial year.
rement criteria” for the consolidated financial statements.
The income statement is classified on the basis of the nature
The financial statements have been prepared on a going
of costs, with separate reporting of net income/(loss) from
concern basis using the cost method, with the exception of
continuing operations and net income/(loss) from any discon-
items measured at fair value in accordance with IFRS, as ex-
tinued operations.
plained in the measurement bases applied to each individual
The indirect method is used for the statement of cash flows,
item in the consolidated financial statements.
with separate reporting of any cash flows by operating, inve-
The financial statements are presented in euro, the functional
sting and financing activities associated with discontinued ope-
currency of the Company, and the figures shown in the notes
rations, if any.
are reported in millions of euro unless stated otherwise.
The income statement, the balance sheet and the statement of
The financial statements provide comparative information in
cash flows report transactions with related parties, the definition
respect of the previous period.
of which is given in the section “Accounting policies and measu-
2
Accounting policies and
measurement criteria
The accounting policies and measurement criteria are the
same, where applicable, as those adopted in the prepara-
tion of the consolidated financial statements, to which the
reader should refer for more information, with the exception
of those regarding equity investments in subsidiaries and
associated companies.
Subsidiaries are all entities over which Enel SpA has control.
The Company controls an entity when it is exposed to or
has rights to variable returns deriving from its involvement
and has the ability, through the exercise of its power over
the investee, to affect its returns. Power is defined as ha-
ving the concrete ability to direct the significant activities of
the entity by virtue of the existence of substantive rights.
Associates comprise those entities in which Enel SpA has a
significant influence. Significant influence is the power to parti-
cipate in the financial and operating policy decisions of investe-
es but not exercise control or joint control over those entities.
Equity investments in subsidiaries and associates are me-
asured at cost. Cost is adjusted for any impairment losses,
which are reversed where the reasons for their recognition
no longer obtain. The carrying amount resulting from the
reversal may not exceed the original cost.
Where the loss pertaining to Enel SpA exceeds the carrying
amount of the investment and the Company is obligated to
perform the legal or constructive obligations of the investee
or in any event to cover its losses, the excess with respect
to the carrying amount is recognized in liabilities in the pro-
vision for risks and charges.
In the case of a disposal, without economic substance, of
an investment to an entity under common control, any diffe-
rence between the consideration received and the carrying
amount of the investment is recognized in equity.
Dividends from equity investments are recognized in profit or
loss when the shareholders’ right to receive them is established.
Dividends and interim dividends payable to third parties are
recognized as changes in equity at the date they are appro-
ved by the Shareholders’ Meeting and the Board of Direc-
tors, respectively.
3
Recent accounting standards
For information on recent accounting standards, please refer to the corresponding section of the notes to the
consolidated financial statements.
316
Annual Report 2015 Information on the Income Statement
Revenue
4.a Revenue from sales and services - €237 million
“Revenue from sales and services” is comprised of:
Millions of euro
Services
Group companies
Non-Group counterparties
Total revenue from sales and services
2015
237
-
237
2014
245
-
245
Change
(8)
-
(8)
Revenue from “services” amounted to €237 million and es-
to certain Group companies, partly offset by an increase in
sentially regard services provided by the Company to subsi-
revenue from communication activities.
diaries as part of its management and coordination function
“Revenue from sales and services” breaks down by geo-
and the rebilling of sundry expenses incurred by it but per-
graphical area as follows:
taining to the subsidiaries. That revenue, which is affected by
> €179 million in Italy (€206 million in 2014);
the new organizational structure of the Group and the new
> €30 million in the European Union (€34 million in 2014);
remuneration system of the Parent Company, decreased by
> €8 million in non-EU Europe (€5 million in 2014);
€8 million compared with the previous year, mainly due to a
> €20 million in other countries (none in 2014).
reduction in management fees and technical fees charged
4.b Other revenue and income - €8 million
“Other revenue and income” came to €8 million in 2015, mainly regarding seconded personnel, up €7 million from the
previous year (€1 million in 2014).
Costs
5.a Consumables - €1 million
Purchases of “consumables” came to €1 million, unchanged from the previous year. They comprise purchases from non-
Group suppliers of consumable materials of various kinds.
5.b Services, leases and rentals - €199 million
Costs for “services, leases and rentals” break down as follows.
Millions of euro
Services
Leases and rentals
Total services, leases and rentals
2015
182
17
199
2014
170
15
185
Change
12
2
14
317
Separate financial statements of Enel SpAAnnual Report 2015 Costs for “services”, totaling €182 million, concerned costs
by €13 million, mainly due to higher costs incurred in respect
for services provided by third parties in the amount of €124
of IT services and training provided by the subsidiary Enel
million (€126 million in 2014) and services provided by Group
Italia Srl, and the increase in costs with Enel Iberoamérica
companies totaling €57 million (€44 million in 2014). More
SL for seconded personnel performing global service acti-
specifically, the decrease in costs for services provided by
vities.
third parties, equal to €2 million, is mainly attributable to
Costs for “leases and rentals” mainly comprise costs for
the decline in advertising, communication and print cam-
leasing assets from the subsidiary Enel Servizi Srl. They
paign expenses as a consequence of the new organizational
increased by €1 million compared with the previous year,
structure adopted by the Group, which transferred part of
essentially due to higher costs in respect of third parties for
communication activities from the holding company to the
vehicle leases and costs for rental and leasing of buildings
Countries.
owned by the subsidiary Enel Italia Srl.
Costs for services rendered by Group companies increased
5.c Personnel - €176 million
Personnel costs break down as follows.
Millions of euro
Wages and salaries
Social security costs
Post-employment benefits
Other long-term benefits
Other costs and other incentive plans
Total
Notes
24
24
25
2015
97
30
(4)
11
42
176
2014
Change
71
24
5
9
11
120
26
6
(9)
2
31
56
“Personnel” costs amounted to €176 million, an increase of
The item “post-employment benefits” includes cost for defi-
€56 million compared with 2014, essentially the result of the
ned benefit plans and for defined contribution plans. In more
rise in “wages and salaries” and the related social security
detail, costs for defined contribution plans amounted to €5
costs (totaling €32 million, essentially attributable to the in-
million for 2015, an increase of €2 million compared with
crease in the workforce), the increase in costs for the new
2014 as a result of the expansion of the workforce.
agreements for voluntary termination benefits under Article 4
of the Fornero Act (€31 million), and a decrease in other costs
The table below shows the average number of employees
connected with the termination of the collective rules on elec-
by category compared with the previous year, and the actual
tricity discounts, with the extinguishment and reversal of the
number of employees at December 31, 2015.
associated provision as of December 31, 2015 (€10 million).
Average number
Headcount
2015
212
549
337
1,098
2014
100
384
306
790
Change
at Dec. 31, 2015
112
165
31
308
211
548
339
1,098
Senior managers
Middle managers
Office staff
Total
318
Annual Report 2015 5.d Depreciation, amortization and impairment losses - €327
million
Millions of euro
Depreciation
Amortization
Impairment losses
Total
2015
3
9
315
327
2014
3
9
531
543
Change
-
-
(216)
(216)
“Depreciation, amortization and
impairment
losses”,
Enel Trade SpA (€250 million) and Enel Ingegneria e Ricerca
amounting to €327 million (€543 million in 2014), decreased
SpA (€65 million), while in 2014 they included impairment
by €216 million compared with the previous year. More spe-
of €531 million on the investments in Enel Produzione SpA
cifically, amortization and depreciation totaled €12 million,
(€512 million) and Enel Ingegneria e Ricerca SpA (€19 mil-
unchanged compared with 2014.
lion).
In 2015, impairment losses amounted to €315 million, re-
For more information on the criteria adopted in determining
flecting the impairment recognized on the investments in
those losses, please see note 13 below.
5.e Other operating expenses - €24 million
“Other operating expenses” amounted to €24 million, up €5
provision was established as at December 31, 2015, following
million on the previous year, mainly due to the provision of €3
the termination, as from January 1, 2016, of the agreement on
million for the compensation to be following the elimination
rate subsidies granted to retired employees and their survivors.
of the electricity discount benefit for retired employees. The
Operating income amounted to a negative €482 million, an improvement of €141 million compared with the pre-
vious year, essentially due to the effect of the recognition in 2014 of greater impairment losses on equity investments
in the amount of €216 million and greater higher costs in 2015 for personnel (€56 million) and rentals and leases (€14
million).
6. Income from equity investments - €2,024 million
Income from equity investments, amounting to €2,024 mil-
(€1,545 million) and the special dividend distributed by Enel
lion, entirely collected in 2015, regards dividends approved by
Iberoamérica SL (€479 million).
the shareholders’ meetings of the subsidiaries and associates
Millions of euro
Dividends from subsidiaries and associates
Enel Produzione SpA
Enel Distribuzione SpA
Enelpower SpA
Enel.Factor SpA
Enel Italia Srl
Enel Energia SpA
Enel Servizio Elettrico SpA
Enel Green Power SpA
Enel Iberoamérica SL
CESI SpA
Dividends from other entities
Emittenti Titoli SpA
Total
2015
2,023
-
1,245
-
-
9
159
-
109
500
1
1
1
2014
1,818
223
1,373
1
3
7
16
85
109
-
1
-
-
2,024
1,818
Change
205
(223)
(128)
(1)
(3)
2
143
(85)
-
500
-
1
1
206
319
Separate financial statements of Enel SpAAnnual Report 2015
7. Net financial income/(expense) from derivatives - €334
million
This item breaks down as follows.
Millions of euro
Income from derivatives
- on behalf of Group companies:
income from derivatives at fair value through profit or loss
- on behalf of Enel SpA:
- income from fair value hedge derivatives
- income from cash flow hedge derivatives
- income from derivatives at fair value through profit or loss
Total income from derivatives
Expense on derivatives
- on behalf of Group companies:
- expense on derivatives at fair value through profit or loss
- on behalf of Enel SpA:
- expense on fair value hedge derivatives
- expense on cash flow hedge derivatives
- expense on derivatives at fair value through profit or loss
Total expense from derivatives
TOTAL NET FINANCIAL INCOME/(EXPENSE) FROM
DERIVATIVES
2015
2,813
2,813
545
33
435
77
3,358
2,824
2,824
200
27
102
71
3,024
334
2014
1,726
1,726
464
39
415
10
2,190
1,737
1,737
217
-
167
50
1,954
236
Change
1,087
1,087
81
(6)
20
67
1,168
1,087
1,087
(17)
27
(65)
21
1,070
98
Net income from derivatives amounted to €334 million (€236
loss (€46 million) and higher net expense on fair value hedge
million in 2014) and essentially reflects the net income from
derivatives (€33 million), all entered into on behalf of Enel
derivatives entered into on behalf of Enel SpA.
SpA on both interest rates and exchange rates.
The increase of €98 million over 2014 reflected the combi-
ned effect of a decrease in net financial expense on cash
For more details on derivatives, please see note 31 “Finan-
flow hedge derivatives (€85 million), an increase in net fi-
cial instruments” and note 33 “Derivatives and hedge ac-
nancial income on derivatives at fair value through profit or
counting”.
320
Annual Report 2015 8. Other net financial income/(expense) - €(1,066) million
This item breaks down as follows.
Millions of euro
Other financial income
Interest income at the effective interest rate
Interest income at the effective interest rate on long-term
financial assets
Interest income at the effective interest rate on short-term
financial assets
Total
Positive exchange rate differences
Income on fair value hedges - post-hedge adjustment
Other income
Total other financial income
Other financial expense
Interest expense
Interest expense on bank borrowings
Interest expense on bonds
Interest expense on other borrowings
Total
Negative exchange rate differences
Interest expense on post-employment and other employee
benefits
Fair value hedge charges - adjustment of hedged items
Other financial expense
Total other financial expense
TOTAL OTHER NET FINANCIAL INCOME/(EXPENSE)
2015
2014
Change
5
155
160
5
4
8
177
25
930
1
956
279
6
-
2
1,243
(1,066)
6
206
212
10
-
-
222
67
968
3
1,038
293
9
26
11
1,377
(1,155)
(1)
(51)
(52)
(5)
4
8
(45)
(42)
(38)
(2)
(82)
(14)
(3)
(26)
(9)
(134)
89
Other net financial expense amounted to €1,066 million,
(totaling €160 million). The decrease in net financial expense
mainly reflecting the interest expense on borrowings (€956
of €89 million over 2014 was primarily caused by a reduction
million) and negative exchange rate differences (€279 mil-
in interest expense on financial debt (€82 million) and mainly
lion), partly offset by short and long-term interest income
reflects changes in debt during the year.
9. Income taxes - €(201) million
Millions of euro
Current taxes
Deferred tax income
Deferred tax expense
Total
2015
(197)
(2)
(2)
(201)
2014
(299)
8
9
(282)
Change
102
(10)
(11)
81
Income taxes for 2015 showed a creditor position of €201
received from the subsidiaries and the deductibility of Enel
million, mainly as a result in the reduction in the tax base
SpA’s interest expense for the Group’s consolidated taxation
for the corporate income tax (IRES) compared with income
mechanism in accordance with corporate income tax law
before taxes due to the exclusion of 95% of the dividends
(Article 96 of the Uniform Income Tax Code).
321
Separate financial statements of Enel SpAAnnual Report 2015 The difference of €81 million on the previous year reflected
ticle 87 of the Uniform Income Tax Code.
both the difference between the two years in the amount
of dividends received from subsidiaries and the writedown
The following table reconciles the theoretical tax rate with
of equity investments meeting the requirements under Ar-
the effective tax rate.
Millions of euro
Income before taxes
Theoretical corporate income taxes (IRES)
(27.5%)
Tax decreases:
- dividends from equity investments
- prior-year writedowns
- other
Tax increases:
- writedowns for the year
- accruals to provisions
- prior-year expense
- other
Total current income taxes (IRES)
IRAP
Difference on estimated income taxes from prior
years
Total deferred tax items
- of which impact of change in tax rate
- of which changes for the year
- of which changes in estimates for previous years
TOTAL INCOME TAXES
2015
810
223
(529)
(10)
(11)
86
17
2
32
(190)
-
(7)
(4)
7
(11)
-
(201)
% rate
27.5%
-65.3%
-1.2%
-1.4%
10.6%
2.1%
0.2%
4.0%
-23.5%
-
-0.9%
-0.5%
% rate
27.5%
-172.1%
-5.1%
-8.0%
55.1%
3.6%
1.1%
1.1%
-96.7%
-
-11.6%
6.2%
2014
276
76
(475)
(14)
(22)
152
10
3
3
(267)
-
(32)
17
-
9
8
-24.8%
(282)
-102.2%
322
Annual Report 2015
Information on the Balance Sheet
Assets
10. Property, plant and equipment - €7 million
Developments in property, plant and equipment for 2014 and 2015 are set out in the table below.
Millions of euro
Cost
Accumulated depreciation
Balance at Dec. 31, 2013
Capital expenditure
Depreciation
Total changes
Cost
Accumulated depreciation
Balance at Dec. 31, 2014
Capital expenditure
Depreciation
Total changes
Cost
Accumulated depreciation
Balance at Dec. 31, 2015
Land
Buildings
Plant and
machinery
Industrial and
commercial
equipment
Other assets
Leasehold
improvements
1
-
1
-
-
-
1
-
1
-
-
-
1
-
1
3
(2)
1
-
-
-
3
(2)
1
-
-
-
3
(2)
1
3
(3)
-
-
-
-
3
(3)
-
-
-
-
3
(3)
-
5
(5)
-
-
-
-
5
(5)
-
-
-
-
5
(5)
-
19
(18)
1
-
-
-
19
(18)
1
-
-
-
19
(18)
1
31
(25)
6
2
(3)
(1)
33
Total
62
(53)
9
2
(3)
(1)
64
(28)
(56)
5
2
(3)
(1)
35
(31)
4
8
2
(3)
(1)
66
(59)
7
“Property, plant and equipment” totaled €7 million, a decre-
the period (€3 million). “Leasehold improvements” mainly
ase of €1 million compared with the previous year, essential-
regard the renovation and safety work on a number of buil-
ly attributable to the negative net balance between capital
dings housing Enel SpA’s headquarters.
expenditure during the year (€2 million) and depreciation for
323
Separate financial statements of Enel SpAAnnual Report 2015 11. Intangible assets - €14 million
“Intangible assets”, all of which have a finite useful life, break down as follows.
Millions of euro
Balance at Dec. 31, 2013
Capital expenditure
Assets entering service
Amortization
Total changes
Balance at Dec. 31, 2014
Capital expenditure
Assets entering service
Amortization
Total changes
Balance at Dec. 31, 2015
Industrial patents
and intellectual property rights
Other intangible assets
under development
Total
10
-
9
(9)
-
10
-
13
(9)
4
14
1
9
(9)
-
-
1
13
(14)
-
(1)
-
11
9
-
(9)
-
11
13
(1)
(9)
3
14
“Industrial patents and intellectual property rights” relate
with the previous year, essentially attributable to assets en-
mainly to costs incurred in purchasing software as well as
tering service (€13 million) and amortization for the year (€9
related evolutionary maintenance. Amortization is calculated
million). Assets entering service essentially relate to softwa-
on a straight-line basis over the item’s residual useful life
re systems to manage consolidated and global reporting,
(three years on average).
risk and centralized finance systems.
The amount of the item increased by €4 million as compared
324
Annual Report 2015 12. Deferred tax assets and liabilities - €373 million and €291
million
Changes in “deferred tax assets” and “deferred tax liabilities”, grouped by type of timing difference, are shown below.
Millions of euro
Deferred tax assets
Nature of temporary differences:
- accruals to provisions for risks and
charges and impairment losses
- derivatives
- other items
Total
Deferred tax liabilities
Nature of temporary differences:
- measurement of financial instruments
- other items
Total
Excess net deferred IRES tax assets after
any offsetting
Excess net deferred IRAP tax liabilities
after any offsetting
at Dec. 31, 2014
Total
Increase/(Decrease)
taken to income
statement
Increase/(Decrease)
taken to equity
Other changes
at Dec. 31,
2015
Total
28
314
41
383
243
9
252
172
(41)
1
-
1
2
-
(2)
(2)
-
(13)
1
(12)
41
-
41
(21)
-
21
-
-
-
-
8
301
64
373
284
7
291
136
(54)
“Deferred tax assets” totaled €373 million (€383 million at
The amount of deferred tax assets and liabilities was deter-
December 31, 2014), a decrease of €10 million compared
mined by applying the rates of 27.5% for IRES for provisions
with the previous year, mainly attributable to lower deferred
and reversals expected for 2016, while for provisions that re-
tax assets in respect of the fair value measurement of cash
fer to periods after 2016, as provided for by law, the rate was
flow hedges (€13 million) and to an increase in deferred tax
adjusted to 24.0% (the effect of the change in the rate led
assets associated with accruals to provisions for risks and
to the reversal of a total of €10 million from equity and of €7
charges and other items (€3 million, of which €2 million re-
million from profit or loss). In addition, deferred tax liabilities
cognized in profit or loss and €1 million in equity).
only also included the rate of 5.57% for IRAP (taking account
“Deferred tax liabilities” totaled €291 million, an increase of
of regional surtaxes). The amount of deferred tax assets was
€39 million (€252 million at December 31, 2014), due largely
determined without applying IRAP as in the coming years
to deferred taxes in respect of the fair value measurement
we do not expect to earn income subject to IRAP sufficient
of cash flow hedges (€41 million).
to reverse the temporary deductible differences.
325
Separate financial statements of Enel SpAAnnual Report 2015 13. Equity investments - €38,984 million
The table below shows the changes during the year for each
and end of the year, as well as the list of investments held in
investment, with the corresponding values at the beginning
subsidiaries, associates and other companies.
Millions of euro
Original cost
(Writedowns)/
Revaluations
Other changes
- IFRIC 11 and
IFRS 2
at Dec. 31, 2014
Carrying
amount
% holding
Capital
contributions
and loss
coverage
Acquisitions/
(Disposals)/
(Settlements)/
(Repayments)
Formation/
Contributions
(+/-)/Mergers (+/-)/
Changes in 2015
A) Subsidiaries
Enel Produzione SpA
4,892
(512)
4,384
100.0
46
4,054
110
901
3,640
8,498
189
-
1,321
18,300
18
5
525
70
1,414
-
(19)
-
-
-
-
(4,473)
(159)
-
(8)
-
-
-
(41)
(54)
-
-
4
1
2
-
1
2
-
-
-
-
-
-
-
3
-
-
-
28
4,056
110
902
3,642
4,025
30
-
1,313
18,300
18
5
487
16
1,414
-
43,983
(5,266)
13
38,730
23
23
5
1
-
6
-
-
(5)
-
-
(5)
-
-
-
-
-
-
23
23
-
1
-
1
100.0
100.0
100.0
100.0
68.3
100.0
100.0
-
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
42.7
4.3
10.0
1.0
-
40
-
-
500
-
-
-
-
-
-
-
-
-
-
-
2
542
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(2)
(2)
-
-
-
-
-
-
Enel Ingegneria e
Ricerca SpA
Enel Distribuzione SpA
Enel Servizio Elettrico
SpA
Enel Trade SpA
Enel Green Power SpA
Enel Investment
Holding BV
Enelpower SpA
Enel Open Fiber SpA
Enel Energia SpA
Enel Iberoamérica SL
Enel.Factor SpA
Enel Sole Srl
Enel Italia Srl
Enel.Newhydro Srl
Enel Finance
International NV
Enel Oil & Gas SpA
Total
C) Associates
CESI SpA
Total
D) Other companies
Elcogas SA
Emittenti Titoli SpA
Idrosicilia SpA
Total
TOTAL
326
44,012
(5,271)
13
38,754
542
(2)
(315)
230
44,557
(5,586)
13
38,984
(Demergers) Value adjustments
Balance
Original cost
Revaluations
IFRS 2
amount
% holding
Other
changes -
(Writedowns)/
IFRIC 11 and
Carrying
at Dec. 31, 2015
4,384
100.0
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5
5
-
-
-
-
-
-
5
(65)
(25)
(250)
250
5
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,892
86
4,054
110
1,401
3,640
8,498
189
5
1,321
18,300
18
5
525
70
1,414
-
44,528
23
23
5
1
-
6
(512)
(84)
(250)
(4,473)
(159)
(8)
(41)
(54)
-
-
-
-
-
-
-
-
-
-
-
-
-
(5)
(5)
4
1
2
-
1
2
3
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3
4,056
110
1,152
3,642
4,025
30
5
1,313
18,300
18
5
487
16
23
23
-
1
-
1
100.0
100.0
100.0
100.0
68.3
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
42.7
4.3
10.0
1.0
(315)
230
(5,581)
13
38,960
1,414
100.0
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Annual Report 2015 Other changes
(Writedowns)/
- IFRIC 11 and
Carrying
amount
at Dec. 31, 2014
Enel Produzione SpA
4,892
(512)
4,384
100.0
A) Subsidiaries
Enel Ingegneria e
Ricerca SpA
Enel Distribuzione SpA
Enel Servizio Elettrico
SpA
Enel Trade SpA
Enel Green Power SpA
Enel Investment
Holding BV
Enelpower SpA
Enel Open Fiber SpA
Enel Energia SpA
Enel Iberoamérica SL
Enel.Factor SpA
Enel Sole Srl
Enel Italia Srl
Enel.Newhydro Srl
Enel Finance
International NV
Enel Oil & Gas SpA
Total
C) Associates
CESI SpA
Total
D) Other companies
Elcogas SA
Emittenti Titoli SpA
Idrosicilia SpA
Total
TOTAL
46
4,054
110
901
3,640
8,498
189
-
1,321
18,300
18
5
525
70
1,414
-
23
23
5
1
-
6
(19)
(4,473)
(159)
(8)
(41)
(54)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(5)
(5)
4
1
2
-
1
2
3
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
28
4,056
110
902
3,642
4,025
30
-
1,313
18,300
18
5
487
16
1,414
-
23
23
1
-
-
1
100.0
100.0
100.0
100.0
68.3
100.0
100.0
-
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
42.7
4.3
10.0
1.0
40
500
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
43,983
(5,266)
13
38,730
2
542
(2)
(2)
44,012
(5,271)
13
38,754
542
(2)
Millions of euro
Original cost
Revaluations
IFRS 2
% holding
coverage
(Repayments)
(Demergers) Value adjustments
Balance
Original cost
Changes in 2015
Capital
Acquisitions/
contributions
(Disposals)/
and loss
(Settlements)/
Formation/
Contributions
(+/-)/Mergers (+/-)/
-
-
-
-
-
-
-
-
5
-
-
-
-
-
-
-
-
5
-
-
-
-
-
-
5
Other
changes -
IFRIC 11 and
IFRS 2
(Writedowns)/
Revaluations
at Dec. 31, 2015
(512)
(84)
-
-
(250)
-
(4,473)
(159)
-
(8)
-
-
-
(41)
(54)
-
-
4
1
2
-
1
2
-
-
-
-
-
-
-
3
-
-
-
Carrying
amount
% holding
4,384
100.0
3
4,056
110
1,152
3,642
4,025
30
5
1,313
18,300
18
5
487
16
100.0
100.0
100.0
100.0
68.3
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
1,414
100.0
-
-
(5,581)
13
38,960
-
-
(5)
-
-
(5)
-
-
-
-
-
-
42.7
4.3
10.0
1.0
23
23
-
1
-
1
-
(65)
-
-
(250)
-
-
-
-
-
-
-
-
-
-
-
-
-
(25)
-
-
250
-
-
-
5
-
-
-
-
-
-
-
-
(315)
230
-
-
-
-
-
-
-
-
-
-
-
-
4,892
86
4,054
110
1,401
3,640
8,498
189
5
1,321
18,300
18
5
525
70
1,414
-
44,528
23
23
5
1
-
6
(315)
230
44,557
(5,586)
13
38,984
327
Separate financial statements of Enel SpAAnnual Report 2015 The table below reports changes in equity investments in 2015.
Millions of euro
Increases
Recapitalization of Enel Oil & Gas SpA
Recapitalization of Enel Trade SpA
Recapitalization of Enel Ingegneria e Ricerca SpA
Formation of Enel Open Fiber SpA
Total
Decreases
Disposal to Enel Trade SpA of interest held in Enel Oil & Gas SpA
Writedown of equity investment in Enel Ingegneria e Ricerca SpA
Writedown of equity investment in Enel Trade SpA
Total
NET CHANGE
2
500
40
5
547
(2)
(65)
(250)
(317)
230
The net increase in the value of equity investments in subsi-
ultra-wide band fiber optic electronic communications net-
diaries, associates and other companies, equal to €230 mil-
works;
lion, is attributable to:
> the writedown of €65 million on the interest held in Enel
> the recapitalization of Enel Oil & Gas SpA in January in the
Ingegneria e Ricerca SpA to take account of losses caused
amount of €2 million, allocated to “Other reserves”, in order
by the contraction in operating activities due to a reduction
to enable the company to meet its operational and financial
in the Group’s investments in conventional generation and
requirements. In November, the investment was sold to
the provision associated with the union agreement on the
Enel Trade SpA for €2 million, corresponding to the value of
application of Article 4 of Law 92/2012 (the Fornero Act);
the company’s equity;
> the writedown of the equity investment in Enel Trade SpA,
> the recapitalization on December 4, 2015, of the subsidiary
in the amount of €250 million, to take account of the losses
Enel Trade SpA through the waiver of part of the financial
posted by the company, connected with developments in
receivable due from that company on the intercompany
the energy commodity market and in the upstream busi-
current account in the amount of €500 million, which was
ness. That impairment loss led to the adjustment of the
allocated to an available equity reserve;
carrying amount of the investment to the value produced
> the recapitalization, on December 15, 2015, of the subsi-
in the impairment test, which was conducted using the di-
diary Enel Ingegneria e Ricerca SpA through the waiver of
scounted cash flow approach. Accordingly, although that
part of the financial receivable due from that company on
value still exceeds the book equity value of the subsidiary,
the intercompany current account in the amount of €40
the results of the test confirm that it is fully recoverable.
million, which was allocated to an available equity reserve;
> the formation, on December 21, 2015, with the payment
The following table reports the main assumptions used in de-
of share capital of €5 million wholly owned by Enel SpA,
termining the impairment losses of Enel Ingegneria e Ricerca
of Enel Open Fiber SpA, created to develop high-speed
SpA and Enel Trade SpA.
Millions of euro
Original cost
Growth rate (1)
Discount rate
pre-tax WACC (2)
Explicit period
of cash flows
Terminal value (3)
Enel Ingegneria e Ricerca SpA
Enel Trade SpA
68
1,402
2.00%
1.90%
9.25%
9.37%
5 years
5 years
Perpetuity
Perpetuity
at Dec. 31, 2015
(1) Perpetual growth rate of cash flows after explicit period.
(2) Pre-tax WACC calculated using the iterative method: the discount rate that ensures that the value in use calculated with pre-tax cash flows is equal to that
calculated with post-tax cash flows discounted with the post-tax WACC.
(3) The terminal value has been estimated on the basis of a perpetuity or an annuity with a rising yield for the years indicated in the column.
328
Annual Report 2015 The recoverable value of the equity investments recognized
operating costs, capital expenditure, industrial and com-
through the impairment tests was estimated by calculating
mercial organization and developments in the main ma-
the equity value of the investments through an estimate of
croeconomic variables (inflation, nominal interest rates
their value in use using discounted cash flow models, which
and exchange rates) and commodity prices. The explicit
involve estimating expected future cash flows and applying
period of cash flows considered in impairment testing
an appropriate discount rate, selected on the basis of mar-
was five years;
ket inputs such as risk-free rates, betas and market risk pre-
> for subsequent years, taking account of assumptions
miums.
concerning long-term developments in the main variables
For the purpose of comparing value with the carrying
that determine cash flows, the average residual useful life
amount of the investments, the enterprise value resulting
of assets or the duration of the concessions.
from the estimation of future cash flows was converted into
More specifically, the terminal value was calculated as a per-
the equity value by subtracting the net financial position of
petuity or annuity.
the investee.
Cash flows were determined on the basis of the best infor-
The share certificates for Enel SpA’s investments in Italian
mation available at the time of the estimate and drawn:
subsidiaries are held in custody at Monte dei Paschi di Siena.
> for the explicit period, from the 5-year 2016-2020 busi-
The following table reports the share capital and sharehol-
ness plan approved by the Board of Directors of the Pa-
ders’ equity of the investments in subsidiaries, associates
rent Company containing forecasts for volumes, revenue,
and other companies at December 31, 2015.
Registered
office Currency
Share capital
(euro)
Shareholders’
equity
(millions of
euro)
Prior year income/
(loss) (millions of
euro)
Carrying
amount
(millions of
euro)
% holding
A) Subsidiaries
Enel Produzione SpA
Enel Ingegneria e Ricerca SpA
Enel Distribuzione SpA
Enel Servizio Elettrico SpA
Enel Trade SpA
Enel Green Power SpA (1)
Rome
Rome
Rome
Rome
Rome
Rome
Enel Investment Holding BV (1)
Amsterdam
Enelpower SpA
Enel Open Fiber SpA
Enel Energia SpA
Enel Iberoamérica SL
Enel.Factor SpA
Enel Sole Srl
Enel Italia Srl
Enel.Newhydro Srl
Milan
Rome
Rome
Madrid
Rome
Rome
Rome
Rome
Enel Finance International NV
Amsterdam
Euro
Euro
Euro
Euro
Euro
Euro
Euro
Euro
Euro
Euro
Euro
Euro
Euro
Euro
Euro
Euro
1,800,000,000
30,000,000
2,600,000,000
10,000,000
90,885,000
1,000,000,000
1,593,050,000
2,000,000
5,000,000
302,039
500,000,000
12,500,000
4,600,000
50,000,000
1,000,000
4,244
29
4,730
69
480
9,630
4,245
30
5
1,785
23,482
52
63
388
19
1,478,810,370
1,486
C) Associates
CESI SpA
D) Other companies
Milan
Euro
8,550,000
Elcogas SA (2)
Puertollano
Emittenti Titoli SpA (2)
Idrosicilia SpA (2)
Milan
Milan
Euro
Euro
Euro
809,690
4,264,000
22,520,000
101
(79)
16
43
330
(37)
1,613
(29)
(255)
264
(593)
-
-
395
435
4
8
(22)
1
31
9
(68)
10
3
100.0
100.0
100.0
100.0
100.0
68.3
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
42.7
4.3
10.0
1.0
4,384
3
4,056
110
1,152
3,642
4,025
30
5
1,313
18,300
18
5
487
16
1,414
23
-
1
-
(1) The figures for shareholders’ equity and the results for the period refer to the Group.
(2) The figures for share capital, shareholders’ equity and net income refer to the financial statements at December 31, 2014.
The carrying amounts of the equity investments in Enel
and Enel Trade SpA are considered to be recoverable even
Produzione SpA, Enel Italia Srl, Enel Servizio Elettrico SpA
though they individually exceed the respective sharehol-
329
Separate financial statements of Enel SpAAnnual Report 2015 ders’ equity at December 31, 2015. This circumstance is
As regards the subsidiary Enel Investment Holding BV, de-
not felt to represent an impairment loss in respect of the
spite equity exceeding the book equity of the company, it
investment but rather a temporary mismatch between the
was nevertheless thought appropriate to conduct an impai-
two amounts. More specifically:
rment test at December 31, 2015, essentially owing to the
> in the case of Enel Produzione, it is due essentially to
adverse performance of the controlling stake that it holds in
a decline in the fair value of a number of balance sheet
Enel Russia, a company operating in the thermal generation
items that are reflected in shareholders’ equity;
sector, for which an impairment loss was recognized during
> as to Enel Italia Srl and Enel Servizio Elettrico SpA, it is
the year.
attributable to the retroactive application of “IAS 19 - Em-
ployee benefits” in 2013, which involved the recognition
Equity investments in other companies at December 31,
of net actuarial losses and that necessarily had an impact
2015 all regard unlisted companies and are measured at
on the companies’ shareholders’ equity. As these losses
cost, as the fair value cannot be reliably determined.
are not monetary in nature, they will be recovered in futu-
The investment in Elcogas was written off in 2014 and sin-
re years with no cash outflow for the subsidiaries.
ce January 1, 2015 the company has been in liquidation.
Millions of euro
Equity investments in unlisted companies measured at cost
Elcogas SA
Emittenti Titoli SpA
Idrosicilia SpA
at Dec. 31, 2015
at Dec. 31, 2014
1
-
1
-
1
-
1
-
14. Derivatives - €2,591 million, €299 million, €2,717 million,
€367 million
Millions of euro
Non-current
Current
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
Derivative financial assets
Derivative financial liabilities
2,591
2,717
1,979
2,484
299
367
280
359
For more details about the nature, recognition and classification of derivative financial assets and liabilities, please see notes
31 “Financial instruments” and 33 “Derivatives and hedge accounting”.
330
Annual Report 2015 15. Other non-current financial assets - €107 million
The aggregate is composed of the following:
Millions of euro
Prepaid expenses
Other non-current financial assets
included in net financial debt
Total
Notes
at Dec. 31, 2015
at Dec. 31, 2014
Change
15.1
30
77
107
25
121
146
5
(44)
(39)
“Prepaid expenses” are essentially accounted for by resi-
February 12, 2015 in the amount of €9.4 billion. The renego-
dual transaction costs on the €10 billion revolving credit fa-
tiation involved a general reduction in the cost of the faci-
cility agreed on April 19, 2010, between Enel, Enel Finance
lity and extended its term until 2020. The item reports the
International and Mediobanca, as well as those in respect
non-current portion of those costs and their reversal through
of the Forward Start Facility Agreement signed on February
profit or loss depends on the type of fee involved and the
8, 2013, and the subsequent renegotiation of the facility on
maturity of the credit line.
15.1 Other non-current financial assets included in net financial debt - €77
million
Millions of euro
Financial receivables
Due from subsidiaries
Other financial receivables
Total
Notes
at Dec. 31, 2015
at Dec. 31, 2014
Change
31.1.1
72
5
77
117
4
121
(45)
1
(44)
Financial receivables due from subsidiaries, amounting
crued on the interest-rate risk hedging contracts, as well as
to €72 million, refers to receivables in respect of the as-
the repayment of the principal upon maturity of each loan.
sumption by Group companies of their share of financial
The decrease of €45 million is attributable to the reclassifi-
debt. The terms of the agreements call for the rebilling of
cation under other current financial assets of the portion of
the related finance costs and the income and expenses ac-
receivables falling due within 12 months.
16. Other non-current assets - €409 million
This item can be broken down as follows.
Millions of euro
Tax receivables
Receivable from subsidiaries for assumption of
supplementary pension plan liabilities
Other long-term receivables
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
244
162
3
409
290
173
4
467
(46)
(11)
(1)
(58)
331
Separate financial statements of Enel SpAAnnual Report 2015 “Tax receivables” regard the tax credit in respect of the
sion plan. The terms of the agreement state that the Group
claim for reimbursement submitted by Enel SpA on its own
companies concerned are to reimburse the costs of extin-
behalf for 2003 and on its own behalf and as the consolida-
guishing defined benefit obligations of the Parent Company,
ting company for 2004-2011 for excess income tax paid as
which are recognized under “Employee benefits”.
a result of not partially deducting IRAP in calculating taxable
On the basis of actuarial forecasts made using current as-
income for IRES purposes. This item decreased by €46 mil-
sumptions, the portion due beyond five years of the “recei-
lion over the previous year due to the partial reimbursement
vable from subsidiaries for assumption of supplementary
of €39 million in respect of the installments for 2004-2007
pension plan liabilities” came to €100 million (€111 million at
and the recalculation of the value of the receivable for inte-
December 31, 2014) .
rest following the reimbursement from the Revenue Agency.
The item “receivable from subsidiaries for assumption of
essentially regard the receivable due from Enel Ingegneria
supplementary pension plan liabilities” in the amount of €162
e Ricerca SpA for the sale in 2011 of the interest held in
“Other long-term receivables” amounted to €3 million and
million refers to receivables in respect of the assumption by
Sviluppo Nucleare Italia Srl.
Group companies of their share of the supplementary pen-
17. Trade receivables - €283 million
The item breaks down as follows.
Millions of euro
Customers:
- other receivables
Total
Trade receivables due from subsidiaries
TOTAL
at Dec. 31, 2015
at Dec. 31, 2014
Change
7
7
276
283
6
6
126
132
1
1
150
151
“Trade receivables due from subsidiaries” primarily regard
the revenue associated with those services, as well as chan-
the management and coordination services and other activi-
ges in in collection times.
ties performed by Enel SpA on behalf of Group companies.
Trade receivables due from subsidiaries break down as fol-
The increase of €150 million is linked with developments in
lows.
332
Annual Report 2015 Millions of euro
Subsidiaries
Enel Iberoamérica SL
Enel Produzione SpA
Enel Distribuzione SpA
Enel Green Power SpA
Endesa SA
Enel Servizio Elettrico SpA
Enel Trade SpA
Enel Energia SpA
Enel Italia Srl
Slovenské elektrárne AS
Enel.si Srl
Enel Green Power North America Inc.
Enel Sole Srl
Enel Russia PJSC
Endesa Distribución Eléctrica SL
Endesa Generación SA
Endesa Energía SA
Enel Romania Srl
Enel Brasil SA
Empresa de Distribución Eléctrica de Lima Norte SAA
Edegel SA
Other
Total
Trade receivables by geographical area are shown below.
Millions of euro
Italy
EU
Non-EU Europe
Other
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
1
23
44
17
(1)
3
5
7
78
16
1
1
-
18
19
3
4
4
15
2
2
14
276
1
18
7
7
-
(1)
3
21
-
17
6
1
2
16
16
(2)
6
4
-
-
-
4
126
-
5
37
10
(1)
4
2
(14)
78
(1)
(5)
-
(2)
2
3
5
(2)
-
15
2
2
10
150
at Dec. 31, 2015
at Dec. 31, 2014
Change
181
56
22
24
283
66
47
18
1
132
115
9
4
23
151
18. Tax receivables - €319 million
Income tax receivables at December 31, 2015 amounted to
dit for current 2015 taxes (€189 million) and the receivable
€319 million and essentially regard the Company’s IRES cre-
with respect to consolidated IRES for 2015 (€127 million).
333
Separate financial statements of Enel SpAAnnual Report 2015 19. Other current financial assets - €3,403 million
This item can be broken down as follows.
Millions of euro
Other current financial assets included in net financial debt
Other sundry current financial assets
Total
Notes
19.1
at Dec. 31, 2015
at Dec. 31, 2014
3,052
351
3,403
4,693
347
5,040
Change
(1,641)
4
(1,637)
19.1 Other current financial assets included in net financial debt - €3,052
million
Millions of euro
Notes
at Dec. 31, 2015
at Dec. 31, 2014
Change
Financial receivables due from Group companies:
- short-term financial receivables (intercompany current
accounts)
- current portion of receivables for assumption of loans
Financial receivables due from others:
- other financial receivables
31.1.1
31.1.1
- cash collateral for margin agreements on OTC derivatives
31.1.1
Total
2,912
4,018
46
8
86
3,052
-
3
672
4,693
(1,106)
46
5
(586)
(1,641)
“Other current financial assets included in net financial
companies on the intercompany current account (€1,106
debt”, amounting to €3,052 million at December 31, 2015,
million), only partly offset by current portion of receivables
refer to “financial receivables due from Group companies”
in respect of the assumption by Group companies of their
(€2,958 million) and “financial receivables due from others
share of financial debt (€46 million).
(€94 million).
“Financial receivables due from others” decreased by €581
“Financial receivables due from Group companies” decrea-
million, essentially attributable to the reduction in cash col-
sed by €1,060 million over December 31, 2014, due to the
lateral paid to counterparties for OTC derivatives on interest
decline in short-term financial receivables due from Group
rates and exchange rates.
20. Other current assets - €460 million
At December 31, 2015, the item broke down as follows.
Millions of euro
Tax receivables
Other receivables due from Group companies
Receivables due from others
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
21
422
17
460
33
208
3
244
(12)
214
14
216
“Other current assets” increased by €216 million as compa-
“Tax receivables” amounted to €21 million, primarily ac-
red with December 31, 2014.
counted for by the VAT credit for the Group (€14 million) and
other receivables with respect to prior-year income taxes (€7
334
Annual Report 2015 million). The decrease of €12 million on the previous year is
(€312 million), and VAT receivables in respect of participating
essentially due to the decline in the VAT credit for the Group.
in the Group VAT mechanism (€110 million). The increase of
“Other receivables due from Group companies” mainly
€214 million on the previous year is essentially attributable
comprise IRES receivables in respect of the Group compa-
to the increase in intercompany IRES receivables connected
nies participating in the consolidated taxation mechanism
with the consolidated taxation mechanism (€196 million).
21. Cash and cash equivalents - €5,925 million
Cash and cash equivalents are detailed in the following table.
Millions of euro
Bank and post office deposits
Cash and cash equivalents on hand
Total
at Dec. 31, 2015
at Dec. 31, 2014
5,925
-
5,925
6,972
-
6,972
Change
(1,047)
-
(1,047)
Cash and cash equivalents amounted to €5,925 million, a
ber of bonds, as well as normal operations connected with
decrease of €1,047 million compared with December 31,
the central treasury function performed by Enel SpA.
2014, mainly due to the impact of the repayment of a num-
335
Separate financial statements of Enel SpAAnnual Report 2015
Liabilities
22. Shareholders’ equity - €24,880 million
Shareholders’ equity amounted to €24,880 million, down
a total of €1,316 million), as approved by the shareholders
€256 million compared with December 31, 2014. The de-
on May 28, 2015, as well as comprehensive income for the
crease is essentially attributable to the distribution of the
year (€1,060 million).
dividend for 2014 in the amount of €0.14 euro per share (for
Share capital - €9,403 million
At December 31, 2015 (as at December 31, 2014), the sha-
February 24, 1998, as well as other available information, no
re capital of Enel SpA amounted to €9,403,357,795 fully
shareholders held more than 2% of the total share capital,
subscribed and paid up, represented by 9,403,357,795 ordi-
apart from the Ministry for the Economy and Finance, which
nary shares with a par value of €1.00 each.
holds 25.50%, Norges Bank (with a 2.018% stake, which fell
At the same date, based on the shareholders register and
below 2% on January 8, 2016) and CNP Assurances (2.87%,
the notices submitted to CONSOB and received by the
held as at June 23, 2015 for asset management purposes).
Company pursuant to Article 120 of Legislative Decree 58 of
Other reserves - €9,163 million
Share premium reserve - €5,292 million
The share premium reserve did not change compared with
It also includes €29 million in respect of the stock option
reserve and €20 million for other reserves.
the previous year.
Legal reserve - €1,881 million
The legal reserve, equal to 20.0% of share capital, did not
Reserve from measurement of financial
instruments - €(277) million
At December 31, 2015, the item was entirely represented
change compared with the previous year.
by the reserve from measurement of cash flow hedge de-
Reserve pursuant to Law 292/1993 - €2,215
million
The reserve shows the remaining portion of the value
adjustments carried out when Enel was transformed from a
public entity to a joint-stock company.
In the case of a distribution of this reserve, the tax treatment
rivatives with a negative value of €277 million (net of the
positive tax effect of €17 million).
Reserve from remeasurement of net em-
ployee benefit liabilities/(assets) - €(16)
million
At December 31, 2015, the employee benefit plan reserve
for capital reserves as defined by Article 47 of the Uniform
amounted to €16 million (net of the positive tax effect of €3
Income Tax Code shall apply.
million). The reserve includes all actuarial gains and losses
Other sundry reserves - €68 million
Other sundry reserves include €19 million related to the re-
serve for capital grants, which reflects 50% of the grants
recognized directly in equity, as the corridor approach is no
longer permitted under the revised version of “IAS 19 - Em-
ployee benefits”.
received from Italian public entities and EU bodies in ap-
The table below provides a breakdown of changes in the
plication of related laws for new works (pursuant to Article
reserve from measurement of financial instruments and the
55 of Presidential Decree 917/1986), which is recognized in
reserve from remeasurement of net employee benefit liabi-
equity in order to take advantage of tax deferment benefits.
lities/(assets) in 2014 and 2015.
336
Annual Report 2015 Gross gains/
(losses)
recognized
in equity for
the year
Gross
released
to income
statement
At Jan. 1,
2014
Taxes
at Dec. 31,
2014
Gross gains/
(losses)
recognized
in equity for
the year
Gross
released
to income
statement
Taxes
at Dec. 31,
2015
(259)
173
(248)
2
(332)
441
(334)
(52)
(277)
(17)
10
-
(3)
(10)
(5)
-
(1)
(16)
(276)
183
(248)
(1)
(342)
436
(334)
(53)
(293)
Millions of euro
Reserve from
measurement of
cash flow hedge
instruments
Gains/(Losses) from
the remeasurement
of net employee
benefit liabilities/
(assets)
Gains/(Losses)
recognized
directly in equity
Retained earnings/(Loss carried forward) - €5,303 million
For 2015, the item shows a decrease of €758 million, attribu-
amount of €846 million for the distribution of dividends to sha-
table to the resolution of the Shareholders’ Meeting of May
reholders and the allocation to “retained earnings” of part of
28, 2015, which provided for the use of this reserve in the
the net income for 2014, equal to €88 million.
Net income - €1,011 million
Net income for 2015 amounted to €1,011 million.
The table below shows the availability of shareholders’ equity for distribution.
Millions of euro
Share capital
Capital reserves:
- share premium reserve
Income reserves:
- legal reserve
- reserve pursuant to Law 292/1993
- reserve from measurement of financial instruments
- reserve for capital grants
- stock option reserve
- reserve from remeasurement of net employee benefit
liabilities/(assets)
- other
Retained earnings/(Loss carried forward)
Total
amount available for distribution
at Dec. 31, 2015
Possible uses
Amount available
9,403
5,292
1,881
2,215
(277)
19
29
(16)
20
5,303
23,869
ABC
B
ABC
ABC
ABC
ABC
ABC
5,292
2,215
19 (1)
29 (2)
20
5,303
12,878
12,875
A: for capital increases.
B: to cover losses.
C: for distribution to shareholders.
(1) Regards lapsed options.
(2) Not distributable in the amount of €3 million regarding options granted by the Parent Company to employees of subsidiaries that have lapsed.
There are no restrictions on the distribution of the reserves
sion costs or research and development costs, or departu-
pursuant to Article 2426, paragraph 1(5) of the Italian Civil
res pursuant to Article 2423, paragraph 4, of the Italian Civil
Code since there are no unamortized start-up and expan-
Code.
337
Separate financial statements of Enel SpAAnnual Report 2015 Note that in the three previous years, the available reserve
Enel’s goals in capital management are focused on the cre-
denominated “retained earnings/(loss carried forward)“ has
ation of value for shareholders, safeguarding the interests
been used in the amount of €846 million for the distribution
of stakeholders and ensuring business continuity, as well
of dividends to shareholders.
as on maintaining sufficient capitalization to ensure cost-
effective access to outside sources of financing, so as to
adequately support growth in the Group’s business.
22.1 Dividends
The table below shows the dividends paid by the Company in 2014 and 2015.
Amount distributed (in millions of euro)
Net dividend per share (in euro)
Dividends paid in 2014
Dividends for 2013
Interim dividend for 2014
Special dividends
Total dividends paid in 2014
Dividends paid in 2015
Dividends for 2014
Interim dividend for 2015
Special dividends
Total dividends paid in 2015
1,223
-
-
1,223
1,316
-
-
1,316
0.13
-
-
0.13
0.14
-
-
0.14
A remaining dividend in respect of 2015, equal to €0.16 per
2016. These financial statements do not reflect the distribu-
share, amounting to a total dividend of €1,627 million, was
tion of this dividend for 2015 to shareholders.
proposed at the Shareholders’ Meeting called for May 26,
22.2 Capital management
The Company’s objectives for managing capital comprise
and adjusts that structure when changes in economic con-
safeguarding the business as a going concern, creating va-
ditions so require. There were no substantive changes in
lue for stakeholders and supporting the development of the
objectives, policies or processes in 2015.
Group. In particular, the Group seeks to maintain an adequa-
To this end, the Company constantly monitors developments
te capitalization that enables it to achieve a satisfactory re-
in the level of its debt in relation to equity. The situation at
turn for shareholders and ensure access to external sources
December 31, 2015 and 2014 is summarized in the following
of financing, in part by maintaining an adequate rating.
table.
In this context, the Company manages its capital structure
Millions of euro
Non-current financial position
Net current financial position
Non-current financial receivables and long-term securities
Net financial debt
Shareholders’ equity
Debt/equity ratio
at Dec. 31, 2015
at Dec. 31, 2014
(14,503)
1,001
77
(13,425)
24,880
(0.54)
(17,288)
4,556
121
(12,611)
25,136
(0.50)
Change
2,785
(3,555)
(44)
(814)
(256)
(0.04)
338
Annual Report 2015 23. Borrowings - €14,503 million, €3,062 million, €4,914
million
Millions of euro
Non-current
Current
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
Long-term borrowings
Short-term borrowings
14,503
-
17,288
-
3,062
4,914
2,363
4,746
For more details about the nature, recognition and classification of borrowings, please see note 31 “Financial instruments”.
24. Employee benefits - €291 million
The Company provides its employees with a variety of be-
The item includes accruals made to cover post-employment
nefits, including termination benefits, additional months’
benefits under defined benefit plans and other long-term
pay, indemnities in lieu of notice, loyalty bonuses for achie-
benefits to which employees are entitled under statute, con-
vement of seniority milestones, supplementary pension
tract or other form of employee incentive scheme.
plans, supplementary healthcare plans, additional indemnity
These obligations, in accordance with IAS 19, were determi-
for FOPEN pension contributions, FOPEN pension contribu-
ned using the projected unit credit method.
tions in excess of deductible amount and personnel incenti-
The following table reports the change during the year in the
ve plans. Following the termination of the collective rules on
defined benefit obligation, as well as a reconciliation of the
electricity discounts, as at December 31, 2015, the electrici-
defined benefit obligation with the obligation recognized in
ty discount provision for reduced price electricity for retired
the balance sheet at December 31, 2015 and December 31,
employees was extinguished and reversed (€10 million).
2014.
Millions of euro
2015
2014
Pension
benefits
Electricity
discount
Health
insurance
Other
benefits
Total
Pension
benefits
Electricity
discount
Health
insurance
Other
benefits
Total
CHANGES IN
ACTUARIAL
OBLIGATION
Actuarial obligation at
January 1
Current service cost
Interest expense
Actuarial (gains)/losses
arising from changes in
financial assumptions
Experience adjustments
Past service cost
(Gains)/Losses arising
from settlements
Other payments
Other changes
Actuarial obligation at
December 31
242
11
6
5
-
6
(1)
-
(33)
5
230
-
-
-
-
-
(10)
(1)
-
-
35
-
1
-
-
-
-
(2)
3
37
14
11
-
-
-
-
-
(4)
3
24
302
17
6
-
6
(1)
(10)
(40)
11
291
273
11
-
8
(7)
(3)
-
-
(29)
-
242
-
-
-
1
-
-
(1)
-
11
37
-
1
(2)
1
-
-
(2)
-
35
15
10
-
-
-
-
-
336
10
9
(9)
(1)
-
-
(11)
(43)
-
-
14
302
339
Separate financial statements of Enel SpAAnnual Report 2015 Millions of euro
(Gains)/Losses charged to profit or loss
Service cost
Interest expense
(Gains)/Losses arising from settlements
Total
Millions of euro
Remeasurement of (gains)/losses in OCI
Actuarial (gains)/losses on defined benefit plans
Other changes
Total
2015
16
6
(10)
12
2015
6
-
6
2014
10
9
-
19
2014
(10)
-
(10)
The current service cost for employee benefits in 2015
discounts, with the extinguishment and reversal of the provision
amounted to €17 million, recognized under personnel costs
as at December 31, 2015.
(€10 million in 2014), while the interest cost from the accretion
of the liability amounted to €6 million (€9 million in 2014). Gains
The main actuarial assumptions used to calculate the liabilities
from settlement of €10 million are attributable to the decrease
arising from employee benefits, which are consistent with tho-
in other costs for the termination of the collective rules on rate
se used the previous year, are set out below.
Discount rate
Rate of wage increases
Rate of increase in healthcare costs
2015
0.50%-2.15%
1.6%-3.6%
2.6%
2014
0.50%-2.15%
1.6%-3.6%
2.6%
The following table reports the outcome of a sensitivity
at the end of the year in the actuarial assumptions used in
analysis that demonstrates the effects on the liability for
estimating the obligation.
healthcare plans as a result of changes reasonably possible
Millions of euro
Healthcare
plans:
ASEM
An increase of
0.5% in discount
rate
A decrease of
0.5% in discount
rate
An increase of
0.5% in inflation
rate
An increase
of 0.5% in
remuneration
An increase of
0.5% in pensions
currently being
paid
An increase of
1% in healthcare
costs
An increase of
1 year in life
expectancy of
active and retired
employees
(2)
2
2
2
2
5
1
25. Provisions for risks and charges - €53 million
The “provisions for risks and charges” cover potential liabi-
In determining the balance of the provision, we have taken
lities that could arise from legal proceedings and other di-
account of both the charges that are expected to result from
sputes, without considering the effects of rulings that are
court judgments and other dispute settlements for the year
expected to be in the Company’s favor and those for which
and an update of the estimates for positions arising in pre-
any charge cannot be quantified with reasonable certainty.
vious years not related to the transferred business units.
340
Annual Report 2015 The following table shows changes in provisions for risks and charges.
Millions of euro
Accruals
Reversals
Utilization
at Dec. 31, 2014
Other
changes
Total
at Dec. 31, 2015
Taken to income statement
Provision for litigation, risks
and other charges:
- litigation
- other
Total
Provision for early retirement
incentives
TOTAL
12
3
15
1
16
3
3
6
32
38
-
-
-
-
-
-
-
-
(1)
(1)
-
-
-
-
-
of which
current
portion
15
3
18
2
20
15
6
21
32
53
The net increase in the litigation provision amounted to
blished on December 31, 2015, following the elimination
€3 million, essentially reflecting new labor disputes and
of the electricity discount benefit for retired personnel
the revision of estimates for a number of outstanding di-
with effect from January 1, 2016 after the termination of
sputes.
the agreement on rate discounts for retired personnel and
The provision covers disputes in Italy and essentially re-
their survivors.
gards labor litigation (€10 million) and litigation concer-
The increase in the provision for early retirement incenti-
ning tender contracts (€3 million).
ves (€32 million) is due largely to the increase in costs fol-
The increase of €3 million in other provisions is essen-
lowing the signing of new agreements for voluntary ter-
tially attributable to the “compensation” provision, esta-
minations under Article 4 of the Fornero Act (€31 million).
26. Other non-current liabilities - €243 million
“Other non-current liabilities” amounted to €243 million
in respect of the subsidiaries is balanced by the recognition
(€287 million at December 31, 2014). They essentially regard
of non-current tax receivables (note 16). The decrease of €44
the debt towards Group companies that arose following Enel
million for the year is essentially attributable to the partial
SpA’s request (submitted in its capacity as the consolidating
reimbursement of that receivable in respect of the instal-
company) for reimbursement for 2004-2011 of the additional
ments for 2004-2007 (€39 million) and the redetermination
income taxes paid as a result of not deducting part of IRAP
of the debt following the reimbursement.
in computing taxable income for IRES purposes. The liability
341
Separate financial statements of Enel SpAAnnual Report 2015 27. Trade payables - €164 million
Millions of euro
Trade payables:
- due to third parties
- due to Group companies
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
105
59
164
85
54
139
20
5
25
“Trade payables” include payables due to third parties of
bles due to Group companies of €59 million (€54 million at
€105 million (€85 million at December 31, 2014) and paya-
December 31, 2014).
Trade payables due to subsidiaries at December 31, 2015 break down as follows.
Millions of euro
Subsidiaries
Enel Produzione SpA
Enel Ingegneria e Ricerca SpA
Enel Servizio Elettrico SpA
Enel Trade SpA
Enel Italia Srl
Enel Iberoamérica SL
Enel.Factor SpA
Endesa SA
Enel Russia PJSC
Sviluppo Nucleare Italia Srl
Other
Total
at Dec. 31, 2015
at Dec. 31, 2014
Change
1
1
1
1
36
8
2
1
4
-
4
59
1
-
-
1
25
-
12
4
4
3
4
54
-
1
1
-
11
8
(10)
(3)
-
(3)
-
5
Trade payables break down by geographical area as follows.
at Dec. 31, 2015
at Dec. 31, 2014
Change
132
18
10
4
164
123
9
5
2
139
9
9
5
2
25
Millions of euro
Suppliers
Italy
EU
Non-EU Europe
Other
Total
342
Annual Report 2015 28. Other current financial liabilities - €643 million
“Other current financial liabilities” mainly regard interest expense accrued on debt outstanding at end-year.
Millions of euro
Deferred financial liabilities
Other items
Total
Notes
31.2.1
31.2.1
at Dec. 31, 2015
at Dec. 31, 2014
Change
584
59
643
649
45
694
(65)
14
(51)
“Deferred financial liabilities” consist of interest expense
both financial expense on hedge derivatives on commodity
accrued on financial debt, while the “other items” essen-
exchange rates and interest expense on intercompany cur-
tially include amounts due to Group companies that accrued
rent accounts.
in 2015 but will be settled in the following year, comprising
29. Net financial position and long-term financial receivables
and securities - €13,425 million
The following table shows the net financial position and long-term financial receivables and securities on the basis of the
items on the balance sheet.
Millions of euro
Long-term borrowings
Short-term borrowings
Current portion of long-term
borrowings
Non-current financial assets
included in debt
Current financial assets
included in debt
Cash and cash equivalents
Total
Notes
at Dec. 31, 2015
at Dec. 31, 2014
23
23
23
15.1
19.1
21
14,503
4,914
3,062
77
3,052
5,925
13,425
17,288
4,746
2,363
121
4,693
6,972
12,611
Change
(2,785)
168
699
(44)
(1,641)
(1,047)
814
343
Separate financial statements of Enel SpAAnnual Report 2015 Pursuant to the CONSOB instructions of July 28, 2006, the
ber 31, 2015, reconciled with net financial debt as reported
following table reports the net financial position at Decem-
in the report on operations.
Millions of euro
Bank and post office deposits
Liquidity
Current financial receivables
Short-term bank debt
Short-term portion of long-term bank debt
Other short-term financial payables
Short-term financial debt
Net short-term financial position
Bonds
Long-term borrowings
Long-term financial position
NET FINANCIAL POSITION as per CONSOB
instructions
Long-term financial receivables
NET FINANCIAL DEBT
at Dec. 31, 2015
at Dec. 31, 2014
Change
of which with
related parties
of which with
related parties
5,925
5,925
3,052
(2)
(3,062)
(4,912)
(7,976)
1,001
(14,503)
(14,503)
(14,503)
(13,502)
77
(13,425)
2,958
(3,243)
72
6,972
6,972
4,693
(3)
(2,363)
(4,743)
(7,109)
4,556
(17,288)
(17,288)
(17,288)
(12,732)
121
(12,611)
4,018
(4,320)
117
(1,047)
(1,047)
(1,641)
1
(699)
(169)
(867)
(3,555)
2,785
2,785
2,785
(770)
(44)
(814)
30. Other current liabilities - €1,046 million
“Other current liabilities” mainly concern payables due to
in the consolidated IRES taxation mechanism, as well as the
the tax authorities and to the Group companies participating
Group VAT system.
Millions of euro
Tax payables
Payables due to Group companies
Payables due to employees,
recreational/assistance associations
Payables due to social security
institutions
Payables due to customers for
security deposits and reimbursements
Other
Total
at Dec. 31, 2015
at Dec. 31, 2014
650
354
24
11
1
6
1,046
540
396
20
8
1
10
975
Change
110
(42)
4
3
-
(4)
71
“Tax payables” amounted to €650 million and essentially re-
lion. They consist of €233 million in payables in respect of
gard amounts due to tax authorities for consolidated IRES
the IRES liability under the consolidated taxation mechanism
(€643 million). The increase as compared with the previous
(€316 million at December 31, 2014) and €121 million in re-
year amounted to €110 million, essentially due to the increa-
spect of Group VAT (€77 million at December 31, 2014). The
se in the debtor position with tax authorities for consolidated
decrease of €42 million essentially reflects developments in
IRES.
the debtor positions noted above.
“Payables due to Group companies” amounted to €354 mil-
344
Annual Report 2015 31. Financial instruments
31.1 Financial assets by category
The following table shows the carrying amount for each ca-
rately hedging derivatives and derivatives measured at fair
tegory of financial assets provided by IAS 39, broken down
value through profit or loss.
into current and non-current financial assets, showing sepa-
Millions of euro
Non-current
Current
Notes
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
Loans and receivables
Financial assets available for sale
31.1.1
31.1.2
Financial assets at fair value through profit or
loss
Derivative financial assets at FVTPL
Total
Derivative financial assets designated as
hedging instruments
Cash flow hedge derivative financial assets
Fair value hedge derivative financial assets
33
33
33
Total
TOTAL
107
1
1,668
1,668
888
35
923
2,699
146
1
1,283
1,283
656
40
696
2,126
9,611
-
299
299
-
-
-
12,144
-
280
280
-
-
-
9,910
12,424
For more details on the recognition and classification of current and non-current derivative financial assets, please see note
33 “Derivatives and hedge accounting”.
31.1.1 Loans and receivables
The following table shows loans and receivables by nature, broken down into current and non-current financial assets.
Millions of euro
Non-current
Current
Notes at Dec. 31, 2015 at Dec. 31, 2014
Notes at Dec. 31, 2015
at Dec. 31, 2014
Cash and cash equivalents
Trade receivables
Financial receivables due from Group
companies
Receivables for assumption of share of financial
debt
Receivables on intercompany current accounts
Short-term loan granted to Enel Finance
International NV
Current portion of receivables for assumption of
loans
19.1
Other financial receivables
Total
Financial receivables due from others
Cash collateral for margin agreements on OTC
derivatives
Other financial receivables
Total
TOTAL
-
-
-
-
21
17
15.1
72
117
-
-
-
-
72
-
35
35
107
19.1
19.1
19.1
-
-
-
-
117
-
29
29
146
5,925
283
-
2,912
-
46
173
3,131
86
186
272
6,972
132
-
4,018
-
-
205
4,223
672
145
817
9,611
12,144
The primary changes compared with 2014 related to:
lion, essentially attributable to the repayment of a num-
> a decrease in “cash and cash equivalents” of €1,047 mil-
ber of bonds;
345
Separate financial statements of Enel SpAAnnual Report 2015 > a decrease in “financial receivables due from Group
totaling €539 million, mainly as a result of a decline in
companies” totaling €1,137 million, largely reflecting the
cash collateral paid to counterparties for OTC derivatives
decrease in receivables on the intercompany current ac-
transactions on interest rates and exchange rates (€586
count held with Group companies (€1,106 million);
million).
> a decrease of “financial receivables due from others”
31.1.2 Financial assets available for sale
Financial assets available for sale amounted to €1 million
“equity investment in other entities” and is carried at cost.
and are represented by the equity investment held by Enel
The value is unchanged with respect to 2014.
SpA in Emittenti Titoli SpA. The investment is classified as an
31.2 Financial liabilities by category
The following table shows the carrying amount for each ca-
parately hedging derivatives and derivatives measured at fair
tegory of financial liabilities provided by IAS 39, broken down
value through profit or loss.
into current and non-current financial liabilities, showing se-
Millions of euro
Non-current
Current
Notes
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2014
Financial liabilities measured at amortized
cost
Financial liabilities at fair value through
profit or loss
Derivative financial liabilities at FVTPL
Total
Derivative financial liabilities designated as
hedging instruments
Cash flow hedge derivatives
Total
TOTAL
31.2.1
14,503
17,288
8,783
7,942
33
33
1,687
1,687
1,030
1,030
17,220
1,295
1,295
1,189
1,189
19,772
367
367
-
-
358
358
1
1
9,150
8,301
For more details on the recognition and classification of cur-
For more details about fair value measurement, please see
rent and non-current derivative financial liabilities, please see
note 34 “Fair value measurement”.
note 33 “Derivatives and hedge accounting”.
31.2.1 Financial liabilities measured at amortized cost
The following table shows financial liabilities at amortized cost by nature, broken down into current and non-current financial
Non-current
Current
Notes at Dec. 31, 2015 at Dec. 31, 2014
Notes at Dec. 31, 2015 at Dec. 31, 2014
23
14,503
17,288
-
-
-
-
-
-
23
27
28
14,503
17,288
3,062
4,914
164
643
8,783
2,363
4,746
139
694
7,942
liabilities.
Millions of euro
Long-term borrowings
Short-term borrowings
Trade payables
Other current financial liabilities
Total
346
Annual Report 2015 Borrowings
Long-term borrowings (including the current portion due within 12 months) - €17,565 million
Long-term borrowings, which refer exclusively to bonds, de-
grouped by type of borrowing and type of interest rate. For
nominated in euros and other currencies, including the cur-
listed debt instruments, the fair value is given by official pri-
rent portion due within 12 months (equal to €3,062 million),
ces. For unlisted debt instruments, fair value is determined
amounted to €17,565 million at December 31, 2015.
using valuation techniques appropriate for each category of
The following table shows the nominal values, carrying
financial instrument and the associated market data for the
amounts and fair values of long-term borrowings at Decem-
reporting date, including the credit spreads of the Group.
ber 31, 2015, including the portion due within 12 months,
Millions of euro
Nominal
value
Carrying
amount
Current
portion
Portion
due in
more than
12 months Fair value
Nominal
value
Carrying
amount
Current
portion
Portion
due in
more than
12 months Fair value
at Dec. 31, 2015
at Dec. 31, 2014
Carrying
amount
Change
Bonds:
- fixed rate
14,693
14,586
1,999
12,587
17,001
15,414
15,284
1,000
14,284
18,166
(698)
- floating rate
2,986
2,979
1,063
1,916
2,931
4,380
4,367
1,363
3,004
4,311
(1,388)
Total
17,679
17,565
3,062
14,503
19,932
19,794
19,651
2,363
17,288
22,477
(2,086)
Total fixed-rate
borrowings
Total floating-
rate borrowings
14,693
14,586
1,999
12,587
17,001
15,414
15,284
1,000
14,284
18,166
(698)
2,986
2,979
1,063
1,916
2,931
4,380
4,367
1,363
3,004
4,311
(1,388)
TOTAL
17,679
17,565
3,062
14,503
19,932
19,794
19,651
2,363
17,288
22,477
(2,086)
The balance for bonds is reported net of €808 million in re-
please see note 32 “Risk management”, while for more de-
spect of the unlisted floating-rate “Special series of bonds
tails about fair value measurement inputs, please see note
reserved for employees 1994-2019”, which Enel SpA holds
34 “Fair value measurement”.
in its portfolio.
For more details about the maturity analysis of borrowings,
and interest rate.
The table below shows long-term borrowings by currency
Long-term borrowings by currency and interest rate
Millions of euro
Carrying amount
Nominal value
Current average
nominal interest rate
Current effective
interest rate
at Dec. 31, 2014
at Dec. 31, 2015
at Dec. 31, 2015
Euro
US dollar
Pound sterling
Total non-euro
currencies
TOTAL
16,056
1,012
2,583
3,595
19,651
13,691
1,130
2,744
3,874
17,565
13,751
1,148
2,780
3,928
17,679
4.4%
8.8%
6.5%
4.7%
9.2%
6.7%
347
Separate financial statements of Enel SpAAnnual Report 2015 The table below reports changes in the nominal value of long-term debt.
Millions of euro
Nominal value
Repayments
New borrowing
at Dec. 31, 2014
Own bonds
repurchased
Exchange
differences
Nominal value
at Dec. 31, 2015
Bonds
Total
19,794
19,794
(2,363)
(2,363)
-
-
(31)
(31)
279
279
17,679
17,679
Compared with December 31, 2014, the nominal value of
€2,363 million in repayments, €31 million in repurchases of
long-term debt decreased by €2,115 million, the net result of
own bonds and €279 million in exchange losses.
New borrowings
There were no transactions involving new borrowings in 2015.
as other hybrid financial instruments issued and greater
seniority than equity instruments;
The main long-term borrowings of Enel SpA are governed by
> prohibition on mergers with other companies, the sale or
covenants that are commonly adopted in international business
leasing of all or a substantial part of the company’s assets
practice. These borrowings are represented by the bond issues
to another company, unless the latter succeeds in all obli-
carried out within the framework of the Global Medium-Term
gations of the issuer.
Notes Program, issues of subordinated unconvertible hybrid
The main covenants for the Forward Start Facility Agreement
bonds, the €9.4 billion Forward Start Facility Agreement agreed
and the loan agreements between Enel SpA and UniCredit SpA
on February 8, 2013 by Enel SpA and Enel Finance International
are substantially similar and can be summarized as follows:
NV with a pool of banks and the loans granted by UniCredit
> negative pledge clauses, under which the borrower and,
SpA in April 2014 and July 2015.
in some cases, significant subsidiaries may not establish
The main covenants in respect of the bond issues in the Global
mortgages, liens or other encumbrances on all or part of
Medium-Term Notes Program of Enel and Enel Finance Inter-
their respective assets to secure certain financial liabili-
national NV can be summarized as follows:
ties, with the exception of expressly permitted encum-
> negative pledge clauses under which the issuer and the
brances;
guarantor may not establish or maintain (except under
> disposals clauses, under which the borrower and, in
statutory requirement) mortgages, liens or other encum-
some cases, the subsidiaries of Enel may not dispose
brances on all or part of its assets or revenue, to secure
of their assets or a significant portion of their assets or
certain financial borrowings, unless the same restrictions
operations, with the exception of expressly permitted di-
are extended equally or pro rata to the bonds in question;
sposals;
> pari passu clauses, under which bonds and the associated
> pari passu clauses, under which the payment underta-
guarantees constitute a direct, unconditional and unse-
kings of the borrower have the same seniority as its other
cured obligation of the issuer and the guarantor, do not
unsecured and unsubordinated payment obligations;
grant preferential rights among them and have at least
> change of control clauses, which are triggered in the
the same seniority as other present and future unsubor-
event: (i) control of Enel is acquired by one or more par-
dinated and unsecured bonds of the issuer and the gua-
ties other than the Italian State or (ii) Enel or any of its
rantor;
subsidiaries transfer a substantial portion of the Group’s
> cross-default clauses, under which the occurrence of a
assets to parties outside the Group such that the financial
default event in respect of a specified financial liability
reliability of the Group is significantly compromised. The
(above a threshold level) of the issuer, the guarantor or
occurrence of one of the two circumstances may give
significant subsidiaries constitutes a default in respect of
rise to: (a) the renegotiation of the terms and conditions
the liabilities in question, which may become immedia-
of the financing or (b) compulsory early repayment of the
tely repayable.
financing by the borrower;
The main covenants covering the hybrid bonds can be summa-
> cross-default clauses, under which the occurrence of a
rized as follows:
default event in respect of a specified financial liability
> subordination clauses: each hybrid bond is subordinate to
(above a threshold level) of the borrower or significant
all other bonds of the issuer and has the same seniority
subsidiaries constitutes a default in respect of the liabi-
348
Annual Report 2015 lities in question, which may become immediately repa-
example, insolvency, bankruptcy proceedings or the entity
yable.
ceases trading.
All the financial borrowings considered specify “events of de-
None of the covenants indicated above has been triggered to
fault” typical of international business practice, such as, for
date.
Debt structure after hedging
The following table shows the effect of the hedges of foreign currency risk on the gross long-term debt structure (including
portions maturing in the next 12 months).
Millions of euro
at Dec. 31, 2015
at Dec. 31, 2014
Impact of
hedging
instruments
Debt
structure
after
hedging
Initial debt structure
Carrying
amount
Notional
amount
%
Initial debt structure
Carrying
amount
Notional
amount
%
Impact of
hedging
instruments
Debt
structure
after
hedging
Euro
US dollar
Pound sterling
13,691
13,751
77.8%
3,928
17,679
16,056
16,145
81.6%
3,649
19,794
1,130
2,744
1,148
2,780
6.5%
15.7%
(1,148)
(2,780)
-
-
1,012
2,583
1,030
2,619
5.2%
13.2%
(1,030)
(2,619)
-
-
Total
17,565
17,679
100.0%
-
17,679
19,651
19,794
100.0%
-
19,794
The following table shows the effect of the hedges of interest rate risk on the gross long-term debt outstanding at the re-
porting date.
Outstanding gross debt
at Dec. 31, 2015
at Dec. 31, 2014
Floating rate
Fixed rate
Total
Before hedging
After hedging
Before hedging
After hedging
16.9%
83.1%
100.0%
20.6%
79.4%
100.0%
22.1%
77.9%
100.0%
19.2%
80.8%
100.0%
Short-term borrowings - €4,914 million
The following table shows short-term borrowings at December 31, 2015, by nature.
Millions of euro
Borrowings from non-Group counterparties
Short-term bank borrowings (ordinary current account)
Cash collateral for CSAs on OTC derivatives received
Total
Borrowings from Group counterparties
Short-term borrowings from Group companies (on intercompany current
accounts)
Other short-term borrowings from Group companies
Total
TOTAL
at Dec. 31, 2015
at Dec. 31, 2014
Change
2
1,669
1,671
3,243
-
3,243
4,914
3
423
426
3,820
500
4,320
4,746
(1)
1,246
1,245
(577)
(500)
(1,077)
168
Short-term borrowings amounted to €4,914 million (€4,746
on interest rates and exchange rates;
million in 2014), up €168 million over the previous year,
> the €577 million decrease in “short-term borrowings from
mainly due to:
Group companies” attributable to an improvement in the
> the €1,246 million increase in cash collateral received
debtor position on the intercompany current account held
from counterparties for transactions in OTC derivatives
with subsidiaries;
349
Separate financial statements of Enel SpAAnnual Report 2015 > the €500 million decrease in “other short-term borrowings
It should be specified that the fair value of current bor-
from Group companies” as a result of drawings made
rowings equals their carrying amount as the impact of di-
on the Intercompany Short Term Deposit Agreement, the
scounting is not significant.
short-term credit line with Enel Finance International NV.
31.2.2 Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss, broken
million) financial liabilities, refer solely to derivative financial
down into current (€367 million) and non-current (€1,687
liabilities.
31.2.3 Net gains and losses
The following table shows net gains and losses by category of financial instruments, excluding derivatives.
Millions of euro
Net gains/(losses)
of which: impairment/reversal of
impairment
Available-for-sale financial assets
Loans and receivables
1
5
-
7
Financial liabilities measured at amortized cost
(1,229)
(1,319)
-
1
-
at Dec. 31, 2015
at Dec. 31, 2014
at Dec. 31, 2015
For more details on net gains and losses on derivatives, please see note 7 “Net financial income/(expense) from derivatives”.
350
Annual Report 2015 32. Risk management
32.1 Financial risk management objectives and policies
As part of its operations, the Company is exposed to a varie-
es/global business lines, which define the roles and re-
ty of financial risks, notably market risks (including interest
sponsibilities for those involved in managing, monitoring
rate risk and exchange risk), credit risk and liquidity risk.
and controlling risks, ensuring the organizational separa-
Enel’s governance arrangements for financial risk envisage:
tion of units involved in managing the Group’s business
> specific internal committees, formed of members of the
and those responsible for managing risk;
Group’s top management and chaired by the CEO, which
> the specification of operational limits at both the Group le-
are responsible for strategic policy-making and oversight
vel and at the level of individual Regions/Countries/global
of risk management;
business lines for the various types of risk. These limits
> the establishment of specific policies set at both the
are monitored periodically by the risk management units.
Group level and at the level of individual Regions/Countri-
32.2 Market risks
Market risk is the risk that the value of financial and non-
During 2015, no overshoots of the threshold values set by
financial assets or liabilities and the associated expected
regulators for the activation of clearing obligations (EMIR -
cash flows could change owing to changes in market pri-
European Market Infrastructure Regulation 648/2012 of the
ces.
European Parliament) were detected.
As part of its operations as an industrial holding company,
Enel SpA is exposed to different market risks, notably the
The volume of transactions in financial derivatives outstan-
risk of changes in interest rates and exchange rates.
ding at December 31, 2015 is reported below, with specifi-
Interest rate risk and exchange risk are primarily generated
calculated at the year-end exchange rates provided by the
by the presence of financial instruments.
European Central Bank, where denominated in currencies
cation of the notional amount of each class of instrument as
The main financial liabilities held by the Company include
other than the euro.
bonds, bank borrowings (including revolving credit facilities
and loans from EU bodies), other borrowings, derivatives,
The notional amount of a derivative contract is the amount
cash collateral for derivatives transactions and trade paya-
on which cash flows are exchanged. This amount can be ex-
bles. The main purpose of those financial instruments is to
pressed as a value or a quantity (for example tons, converted
finance the operations of the Company.
into euro by multiplying the notional amount by the agreed
The main financial assets held by the Company include fi-
price).
nancial receivables, derivatives, cash collateral for derivati-
The notional amounts of derivatives reported here do not
ves transactions, cash and short-term deposits and trade
represent amounts exchanged between the parties and
receivables.
therefore are not a measure of the Company’s credit risk
For more details, please see note 31 “Financial instruments”.
exposure.
The source of exposure to interest rate risk and exchange
risk did not change with respect to the previous year.
Interest rate risk
Interest rate risk is the risk that the fair value or future cash
As the Parent Company, Enel SpA centralizes some treasury
flows of a financial instrument will fluctuate because of chan-
management functions and access to financial markets with
ges in market interest rates.
regard to financial derivatives contracts on interest rates and
exchange rates. As part of this activity, Enel SpA acts as an
Interest rate risk for the Company manifests itself as a change
intermediary for Group companies with the market, taking
in the flows associated with interest payments on floating-
positions that, while they can be substantial, do not however
rate financial liabilities, a change in financial terms and con-
represent an exposure to markets risks for Enel SpA.
ditions in negotiating new debt instruments or as an adverse
351
Separate financial statements of Enel SpAAnnual Report 2015 change in the value of financial assets/liabilities measured at
This goal is pursued through the strategic diversification of
fair value, which are typically fixed-rate debt instruments.
the portfolio of financial liabilities by contract type, maturity
Interest rate risk is managed with the dual goals of reducing
and interest rate, and modifying the risk profile of specific ex-
the amount of debt exposed to interest rate fluctuations and
posures using OTC derivatives, mainly interest rate swaps.
containing the cost of funds, limiting the volatility of results.
The notional amount of outstanding contracts is reported below.
Millions of euro
Notional amount
Interest rate derivatives
Interest rate swaps
Total
at Dec. 31, 2015
at Dec. 31, 2014
21,163
21,163
8,943
8,943
The term of such contracts does not exceed the maturity
an increase in market interest rates.
of the underlying financial liability, so that any change in the
At December 31, 2015, 16.9% of gross long-term financial
fair value and/or cash flows of such contracts is offset by a
debt was floating rate (22.1% at December 31, 2014). Taking
corresponding change in the fair value and/or cash flows of
account of hedges of interest rates considered effective
the underlying position.
pursuant to the IAS 39, 79.4% of gross long-term financial
Interest rate swaps normally provide for the periodic
debt was hedged at December 31, 2015 (80.8% hedged at
exchange of floating-rate interest flows for fixed-rate inte-
December 31, 2014). Including derivatives treated as hed-
rest flows, both of which are calculated on the basis of the
ges for management purposes but ineligible for hedge ac-
notional principal amount.
counting, the ratio is essentially unchanged.
The notional amount of open interest rate swaps at the end
Interest rate risk sensitivity analysis
of the year was €21,163 million (€8,943 million at December
The Company analyses the sensitivity of its exposure by
31, 2014), of which €1,329 million (€2,629 million at Decem-
estimating the effects of a change in interest rates on the
ber 31, 2014) in respect of hedges of the Company’s share
portfolio of financial instruments.
of debt, and €9,917 million (€3,157 million at December 31,
More specifically, sensitivity analysis measures the poten-
2014) in respect of hedges of the debt of Group companies
tial impact of market scenarios on equity, for the cash flow
with the market intermediated in the same notional amount
hedge component, and on profit or loss, for the fair value
with those companies.
hedge component, for derivatives that are not eligible for
hedge accounting and for the portion of gross long-term
For more details on interest rate derivatives, please see
debt not hedged using derivative financial instruments.
note 33 “Derivatives and hedge accounting”.
These scenarios are represented by parallel increases and
decreases in the yield curve as at the reporting date.
The amount of floating-rate debt that is not hedged against
There were no changes in the methods and assumptions
interest rate risk is the main risk factor that could impact the
used in the sensitivity analysis compared with the previous
income statement (raising borrowing costs) in the event of
year.
352
Annual Report 2015 With all other variables held constant, the Company’s profit before tax would be affected as follows:
Millions of euro
Change in financial expense
on gross long-term floating-
rate debt after hedging
Change in fair value of
derivatives classified as non-
hedging instruments
Change in fair value of
derivatives designated as
hedging instruments
Cash flow hedges
Fair value hedges
Basis
points
25
25
25
25
at Dec. 31, 2015
at Dec. 31, 2014
Pre-tax impact
on profit or loss
Pre-tax impact
on equity
Pre-tax impact
on profit or loss
Pre-tax impact
on equity
Increase
Decrease
Increase
Decrease
Increase
Decrease
Increase
Decrease
9
7
-
(7)
(9)
(7)
-
7
-
-
13
-
-
-
(13)
-
9
8
-
(9)
(9)
(8)
-
9
-
-
17
-
-
-
(17)
-
Exchange risk
Exchange risk is the risk that the fair value or future cash
ties agree to exchange principal amounts denominated in
different currencies at a specified future date and exchan-
flows of a financial instrument will fluctuate because of
ge rate (the strike). Such contracts may call for the actual
changes in exchange rates.
exchange of the two amounts (deliverable forwards) or
For Enel SpA, the main source of exchange risk is the pre-
rate and the prevailing exchange rate at maturity (non-deli-
sence of monetary financial instruments denominated in a
verable forwards). In the latter case, the strike rate and/or
currency other than the euro, mainly bonds denominated
the spot rate may be determined as averages of the official
in foreign currency.
fixings of the European Central Bank.
payment of the difference between the strike exchange
The exposure to exchange risk did not change with respect
to the previous year.
Cross currency interest rate swaps are used to transform a
For more details, please see note 31 “Financial instru-
long-term fixed- or floating-rate liability in foreign currency
ments”.
into an equivalent floating- or fixed-rate liability in euros. In
addition to having notionals denominated in different cur-
In order to minimize exposure to changes in exchange ra-
rencies, these instruments differ from interest rate swaps
tes, the Company normally uses a variety of OTC derivati-
in that they provide both for the periodic exchange of cash
ves such as currency forwards and cross currency interest
flows and the final exchange of principal.
rate swaps. The term of such contracts does not exceed
the maturity of the underlying exposure.
The following table reports the notional amount of transac-
tions outstanding at December 31, 2015 and December
Currency forwards are contracts in which the counterpar-
31, 2014, broken down by type of hedged item.
Millions of euro
Notional amount
at Dec. 31, 2015
at Dec. 31, 2014
Foreign exchange derivatives
Currency forwards:
- hedging exchange risk on commodities
- hedging future cash flows
- other currency forwards
Cross currency interest rate swaps
Total
11,389
7,240
4,138
11
23,729
35,118
11,218
8,378
2,840
-
22,017
33,235
353
Separate financial statements of Enel SpAAnnual Report 2015 More specifically, these include:
is denominated in currencies other than the euro.
> currency forward contracts with a total notional amount
Considering exchange rate hedges and the portion of debt
of €7,240 million (€8,378 million at December 31, 2014),
in foreign currency that is denominated in the currency of
of which €3,620 million to hedge the exchange risk asso-
account or the functional currency of the Company, the debt
ciated with purchases of energy commodities by Group
is fully hedged using cross currency interest rate swaps.
companies, with matching transactions with the market;
> currency forward contracts with a notional amount of
Exchange risk sensitivity analysis
€4,138 million (€2,840 million at December 31, 2014), to
The Company analyses the sensitivity of its exposure by
hedge the exchange risk associated with other expected
estimating the effects of a change in exchange rates on the
cash flows in currencies other than the euro, of which
portfolio of financial instruments.
€2,069 million in market transactions;
More specifically, sensitivity analysis measures the potential
> cross currency interest rate swaps with a notional amount
impact of market scenarios on equity, for the cash flow hed-
of €23,729 million (€22,017 million at December 31, 2014)
ge component, and on profit or loss, for the fair value hedge
to hedge the exchange risk on the debt of Enel SpA or
component, for derivatives that are not eligible for hedge
other Group companies denominated in currencies other
accounting and for the portion of gross long-term debt not
than the euro.
hedged using derivative financial instruments.
For more details, please see note 33 “Derivatives and hedge
ciation of the euro against all of the foreign currencies com-
These scenarios are represented by the appreciation/depre-
accounting”.
pared with the value observed as at the reporting date.
There were no changes in the methods and assumptions
An analysis of the Group’s debt shows that 22.2% of gross
used in the sensitivity analysis compared with the previous
medium and long-term debt (18.4% at December 31, 2014)
year.
With all other variables held constant, the profit before tax would be affected as follows:
at Dec. 31, 2015
at Dec. 31, 2014
Pre-tax impact
on profit or loss
Pre-tax impact
on equity
Pre-tax impact
on profit or loss
Pre-tax impact
on equity
Exchange
rate
Increase
Decrease
Increase
Decrease
Increase
Decrease
Increase
Decrease
10%
10%
-
-
-
-
(507)
-
620
-
-
-
-
-
(485)
592
-
-
Millions of euro
Change in
fair value of
derivatives
designated
as hedging
instruments
Cash flow
hedges
Fair value
hedges
354
Annual Report 2015 32.3 Credit risk
Credit risk is represented by the possibility that a change
ring risks under the policies and procedures outlined in the
in the creditworthiness of a counterparty in a financial tran-
governance rules for managing the Group’s risks, which are
saction could impact the creditor position, in terms of insol-
also designed to ensure prompt identification of possible mi-
vency (default risk) or changes in its market value (spread
tigation actions to be taken.
risk) such as to give rise to a loss. The Company is exposed
Within this general framework, Enel entered into margin
to credit risk from its financial activities, including transac-
agreements with the leading financial institutions with which
tions in derivatives, deposits with banks and financial insti-
it operates that call for the exchange of cash collateral, which
tutions, foreign exchange transactions and other financial
significantly mitigates the exposure to counterparty risk.
instruments.
The sources of exposure to credit risk did not change with
At December 31, 2015, the exposure to credit risk, repre-
respect to the previous year.
sented by the carrying amount of financial assets net of re-
The Company’s management of credit risk is based on the
lated provisions for impairment as well as derivatives with a
selection of counterparties from among leading Italian and
positive fair value, net of any cash collateral held, amounted
international financial institutions with high credit standing
to €10,909 million (€14,101 million at December 31, 2014).
considered solvent both by the market and on the basis
Of the total, €3,822 million regard receivables in respect of
of internal assessments, diversifying the exposure among
Group companies and €5,925 million regard cash and cash
them. Credit exposures and associated credit risk are regu-
equivalents.
larly monitored by the departments responsible for monito-
Millions of euro
Non-current financial receivables
Other non-current financial assets
Trade receivables
Current financial receivables
Other current financial assets
Financial derivatives
Cash and cash equivalents
at Dec. 31, 2015
at Dec. 31, 2014
Change
of which Group
of which Group
72
5
283
2,958
445
1,221
5,925
72
-
276
2,958
173
343
-
117
4
132
4,018
1,022
1,836
6,972
117
-
126
4,018
205
869
-
(45)
1
151
(1,060)
(577)
(615)
(1,047)
(3,192)
Total
10,909
3,822
14,101
5,335
32.4 Liquidity risk
Liquidity risk is the risk that the Company will encounter
In the long term, liquidity risk is mitigated by maintaining
difficulty in meeting obligations associated with financial lia-
a balanced debt maturity profile, diversification of funding
bilities that are settled by delivering cash or another financial
sources in terms of instruments, markets/currencies and
asset.
counterparties.
The objectives of liquidity risk management policies are:
> ensuring an appropriate level of liquidity for the Group,
At December 31, 2015 Enel SpA had a total of about €5,925
minimizing the associated opportunity cost;
million in cash or cash equivalents (€6,972 million at Decem-
> maintaining a balanced debt structure in terms of the ma-
ber 31, 2014), and committed lines of credit amounting to
turity profile and funding sources.
€5,720 million (of which none had been drawn) maturing in
In the short term, liquidity risk is mitigated by maintaining an
more than one year (€5,670 million at December 31, 2014).
appropriate level of unconditionally available resources, in-
cluding cash and short-term deposits, available committed
credit lines and a portfolio of highly liquid asset.
355
Separate financial statements of Enel SpAAnnual Report 2015 Maturity analysis
The table below summarizes the maturity profile of the Company’s financial liabilities based on contractual undiscounted
payments.
Millions of euro
Bonds:
- fixed rate
- floating rate
Total
Less than 3
months
Between 3 months
and 1 year
Between 1 and 2
years
Between 2 and 5
years
Over 5 years
Maturing in
1,999
999
2,998
-
64
64
1,498
65
1,563
6,746
869
7,615
4,343
982
5,325
32.5 Offsetting financial assets and financial liabilities
The following table reports the net financial assets and lia-
guarantee transactions involving derivatives, Enel SpA has
bilities. More specifically, it shows that there are no netting
entered into margin agreements with leading financial insti-
arrangements for derivatives in the financial statements
tutions that call for the exchange of cash collateral, broken
since the Company does not plan to set-off assets and lia-
down as shown in the table.
bilities. As envisaged by current market regulations and to
Millions of euro
(a)
(b)
(c)=(a)-(b)
at Dec. 31, 2015
(d)
(e)=(c)-(d)
Related amounts not set off in the
balance sheet
(d)(i),(d)(ii)
(d)(iii)
Gross amounts
of recognized
financial assets/
(liabilities) set off
in the balance
sheet
Net amounts of
financial assets/
(liabilities)
presented in the
balance sheet
Gross amounts
of recognized
financial assets/
(liabilities)
Net portion of
financial assets/
(liabilities)
guaranteed with
cash collateral
Net amounts of
financial assets/
(liabilities)
Financial
instruments
450
2,440
2,890
2,890
(629)
(2,455)
(3,084)
(3,084)
(194)
-
-
-
-
-
-
-
-
-
450
2,440
2,890
2,890
(629)
(2,455)
(3,084)
(3,084)
(194)
-
-
-
-
-
-
-
-
-
(132)
(2,113)
(2,245)
(2,245)
441
221
662
662
318
327
645
645
(188)
(2,234)
(2,422)
(2,422)
(1,583)
(1,777)
FINANCIAL ASSETS
Derivative financial assets:
- on interest rate risk
- on exchange risk
Total derivative financial
assets
TOTAL FINANCIAL ASSETS
FINANCIAL LIABILITIES
Derivative financial liabilities:
- on interest rate risk
- on exchange risk
Total derivative financial
liabilities
TOTAL FINANCIAL LIABILITIES
TOTAL NET FINANCIAL
ASSETS/(LIABILITIES)
356
Annual Report 2015 33. Derivatives and hedge accounting
The following tables report the notional amount and fair va-
can be expressed as a value or a quantity (for example tons,
lue of derivative financial assets and liabilities by type of hed-
converted into euros by multiplying the notional amount by
ge relationship and hedged risk, broken down into current
the agreed price). Amounts denominated in currencies other
and non-current derivative financial assets and liabilities.
than the euro are converted at the end-year exchange rates
The notional amount of a derivative contract is the amount
provided by the European Central Bank.
on the basis of which cash flows are exchanged. This amount
Millions of euro
Non-current
Current
Notional amount
Fair value assets
Notional amount
Fair value assets
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
Change
Change
Derivatives designated
as hedging instruments
Cash flow hedges:
- on interest rate risk
- on exchange risk
Total cash flow hedges
Fair value hedges:
- on interest rate risk
Total fair value hedges
Derivatives at FVTPL:
- on interest rate risk
- on exchange risk
Total derivatives at
FVTPL
TOTAL DERIVATIVE
FINANCIAL ASSETS
-
3,928
3,928
800
800
-
3,649
3,649
800
800
-
888
888
35
35
9,822
9,474
3,112
9,582
413
1,255
-
656
656
40
40
376
907
-
232
232
(5)
(5)
37
348
-
-
-
-
-
400
-
400
-
-
96
45
5,342
4,476
19,296
12,694
1,668
1,283
385
5,438
4,521
24,024
17,143
2,591
1,979
612
5,438
4,921
-
-
-
-
-
2
297
299
299
-
-
-
-
-
2
278
280
280
-
-
-
-
-
-
19
19
19
Millions of euro
Non-current
Current
Notional amount
Fair value assets
Notional amount
Fair value assets
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
Change
at Dec. 31,
2014 Change
Derivatives designated
as hedging instruments
Cash flow hedges:
- on interest rate risk
- on exchange risk
Total cash flow hedges
Derivatives at FVTPL:
- on interest rate risk
- on exchange risk
Total derivatives at
FVTPL
TOTAL DERIVATIVE
FINANCIAL LIABILITIES
390
1,556
1,946
9,860
9,475
390
1,470
1,860
3,150
9,582
143
887
159
(16)
1,030
(143)
1,030
1,189
(159)
-
-
-
900
-
900
419
1,268
384
911
35
357
195
146
5,343
4,476
19,335
12,732
1,687
1,295
392
5,538
4,622
21,281
14,592
2,717
2,484
233
5,538
5,522
-
-
-
67
300
367
367
1
-
1
75
283
358
359
(1)
-
(1)
(8)
17
9
8
357
Separate financial statements of Enel SpAAnnual Report 2015 33.1 Hedge accounting
Derivatives are initially recognized at fair value, on the trade
a highly probable transaction that could affect profit or loss.
date of the contract and are subsequently re-measured at
The effective portion of changes in the fair value of derivati-
their fair value.
ves that are designated and qualify as cash flow hedges is
The method of recognizing the resulting gain or loss depen-
recognized in other comprehensive income. The gain or loss
ds on whether the derivative is designated as a hedging in-
relating to the ineffective portion is recognized immediately
strument, and if so, on the nature of the item being hedged.
in the income statement.
Hedge accounting is applied to derivatives entered into in
Amounts accumulated in equity are reclassified to profit or
order to reduce risks such as interest rate risk, exchange
loss in the period when the hedged item affects profit or
risk, commodity risk, credit risk and equity risk when all the
loss.
criteria provided for under IAS 39 are met.
When a hedging instrument expires or is sold, or when a
At the inception of the transaction, the Company documents
hedge no longer meets the criteria for hedge accounting but
the relationship between hedging instruments and hedged
the hedged item has not expired or been cancelled, any cu-
items, as well as its risk management objectives and stra-
mulative gain or loss existing in equity at that time remains
tegy. The Company also analyzes, both at hedge inception
in equity and is recognized when the forecast transaction is
and on an ongoing systematic basis, the effectiveness of
ultimately recognized in the income statement.
hedges using prospective and retrospective tests in order
When a forecast transaction is no longer expected to occur,
to determine whether hedging instruments are highly effec-
the cumulative gain or loss that was reported in equity is
tive in offsetting changes in the fair values or cash flows of
immediately transferred to profit or loss.
hedged items.
The Company currently uses these hedge relationships to
Depending on the nature of the risks to which it is exposed,
minimize the volatility of profit or loss.
the Company designates derivatives as hedging instruments
in one of the following hedge relationships:
> cash flow hedge derivatives in respect of the risk of: (i)
Fair value hedges
Fair value hedges are used to protect the Company against
changes in the cash flows associated with long-term floa-
exposures to adverse changes in the fair value of assets,
ting-rate debt; (ii) changes in the exchange rates associa-
liabilities or firm commitments attributable to a particular
ted with long-term debt denominated in a currency other
risk that could affect profit or loss.
than the currency of account or the functional currency in
Changes in the fair value of derivatives that qualify and are
which the company holding the financial liability operates;
designated as hedging instruments are recognized in the
(iii) changes in the price of fuels and non-energy commo-
income statement, together with changes in the fair value
dities denominated in a foreign currency;
of the hedged item that are attributable to the hedged risk.
> fair value hedge derivatives involving the hedging of expo-
If the hedge is ineffective or no longer meets the criteria for
sures to changes in the fair value of an asset, a liability or
hedge accounting, the adjustment to the carrying amount
a firm commitment attributable to a specific risk;
of a hedged item for which the effective interest method
> derivatives hedging a net investment in a foreign opera-
is used is amortized to profit or loss over the period to ma-
tion (NIFO), involving the hedging of exposures to exchan-
turity.
ge rate volatility associated with investments in foreign
entities.
The Company currently makes use of such hedge rela-
tionships to seize opportunities associated with general de-
For more details on the nature and the extent of risks arising
velopments in the yield curve.
from financial instruments to which the Company is expo-
sed, please see note 32 “Risk management”.
Cash flow hedges
Cash flow hedges are used in order to hedge the Company’s
exposure to changes in future cash flows that are attributa-
ble to a particular risk associated with an asset, a liability or
358
Annual Report 2015 Hedge of a Net Investment in a Foreign
Operation (NIFO)
Hedges of net investments in foreign operations, with a fun-
which time the foreign exchange differences are transferred
to profit or loss.
ctional currency other than the euro, are hedges of the impact
The Company does not currently hold any hedges of net in-
of changes in exchange rates in respect of investments in fo-
vestments in a foreign operation.
reign entities. The hedge instrument is a liability denominated
in the same currency as the investment. The foreign exchange
For more information on the fair value measurement of deri-
differences of the hedged item and the hedge are accumula-
vatives, please see note 34 “Fair value measurement”.
ted each year in equity until the disposal of the investment, at
Hedge relationships by type of risk hedged
33.1.1 Interest rate risk
The following table shows the notional amount and the fair
transactions outstanding as at December 31, 2015 and De-
value of the hedging instruments on the interest rate risk of
cember 31, 2014, broken down by type of hedged item.
Millions of euro
Fair
value
Notional
amount
Fair
value
Notional
amount
Hedged instrument
Hedged item
at Dec. 31, 2015
at Dec. 31, 2014
Interest rate swaps
Interest rate swaps
Total
Floating-rate
borrowings
Fixed-rate
borrowings
(143)
35
(108)
390
800
1,190
(160)
40
(120)
1,690
800
2,490
The interest rate swaps outstanding at the end of the year
hedge derivatives refer to the hedging of certain floating-rate
and designated as hedging instruments function as a cash
bonds issued since 2001.
flow hedge and fair value hedge for the hedged item. More
The following table shows the notional amount and the fair
specifically, fair value hedge derivatives relate to the issue of
value of hedging derivatives on interest rate risk as at Decem-
an unconvertible hybrid bond denominated in euros in 2013,
ber 31, 2015 and December 31, 2014, broken down by type
hedged in the amount of €800 million, while the cash flow
of hedge.
Millions of euro
Notional amount
Fair value assets
Notional amount
Fair value liabilities
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
Cash flow hedge
derivatives:
- interest rate swaps
Fair value hedge
derivatives:
- interest rate swaps
TOTAL INTEREST RATE
DERIVATIVES
-
-
800
800
800
400
400
800
800
1,200
-
-
35
35
35
-
-
40
40
40
390
390
-
-
1,290
1,290
-
-
(143)
(143)
-
-
(160)
(160)
-
-
390
1,290
(143)
(160)
The notional amount of the interest rate swaps at December
flow hedge positions for the same amount in 2015.
31, 2015 came to €1,190 million (€2,490 million at December
The general decline in the yield curve over the course of the
31, 2014), with a corresponding negative fair value of €108
year prompted an improvement in the fair value of the fair
million (negative €120 million at December 31, 2014).
value hedge derivatives.
The decline of €1,300 million in the notional amount is attri-
butable to the maturing, and consequent closure, of cash
359
Separate financial statements of Enel SpAAnnual Report 2015 Cash flow hedge derivatives
The following table shows the cash flows expected in coming years from cash flow hedge derivatives.
Millions of euro
Fair value
Distribution of expected cash flows
Cash flow hedge derivatives
on interest rates
at Dec. 31, 2015
Positive fair value
Negative fair value
-
(143)
2016
-
(14)
2017
-
(14)
2018
-
(13)
2019
-
(13)
2020
-
(12)
Beyond
-
(95)
The following table shows the impact of cash flow hedge derivatives on interest rate risk on equity during the period, gross
of tax effects.
Millions of euro
Opening balance at January 1
Changes in fair value recognized in equity (OCI)
Changes in fair value recognized in profit or loss - recycling
Changes in fair value recognized in profit or loss - ineffective portion
Closing balance at December 31
2015
(93)
-
6
-
(87)
2014
(86)
-
(7)
-
(93)
Fair value hedge derivatives
The following table shows the cash flows expected in coming years from fair value hedge derivatives.
Millions of euro
Fair value
Distribution of expected cash flows
Fair value hedge derivatives
at Dec. 31, 2015
2016
2017
2018
2019
2020
Beyond
Positive fair value
Negative fair value
35
-
12
-
13
-
11
-
31
-
-
-
-
-
33.1.2 Exchange risk
The following table shows the notional amount and the fair
sactions outstanding as at December 31, 2015 and Decem-
value of the hedging instruments on exchange risk of tran-
ber 31, 2014, broken down by type of hedged item.
Millions of euro
Hedging instruments
Fair value Notional amount
Fair value
Notional amount
Hedged item
at Dec. 31, 2015
at Dec. 31, 2014
Cross currency interest rate swap (CCIRS)
Fixed-rate borrowings
Total
1
1
5,484
5,484
(374)
(374)
5,119
5,119
The cross currency interest rate swaps outstanding at the
The following table shows the notional amount and the fair
end of the year and designated as hedging instruments
value of derivatives on exchange risk as at December 31, 2015
function as a cash flow hedge for the hedged item. More
and December 31, 2014, broken down by type of hedge.
specifically, these derivatives hedge fixed-rate bonds deno-
minated in foreign currencies.
Millions of euro
Notional amount
Fair value assets
Notional amount
Fair value liabilities
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
3,928
3,649
3,928
3,649
3,928
3,649
888
888
888
656
656
656
1,556
1,470
(887)
(1,030)
1,556
1,470
(887)
(1,030)
1,556
1,470
(887)
(1,030)
Cash flow hedge
derivatives:
- cross currency interest
rate swaps
Total foreign exchange
derivatives
360
Annual Report 2015
The notional amount of the cross currency interest rate swaps
The notional amount and the relative fair value essentially
at December 31, 2015 came to €5,484 million (€5,119 million
changed as a result of developments in the exchange rate of
at December 31, 2014), with a corresponding positive fair va-
the euro against the main other currencies.
lue of €1 million (negative €374 million at December 31, 2014).
Cash flow hedge derivatives
The following table shows the cash flows expected in coming years from cash flow hedge derivatives on exchange risk.
Millions of euro
Fair value
Distribution of expected cash flows
Cash flow hedge derivatives
on exchange rates
at Dec. 31, 2015
2016
Positive fair value
Negative fair value
888
(887)
123
(73)
2017
116
(65)
2018
110
(59)
2019
762
(474)
2020
116
(108)
Beyond
148
(28)
The following table shows the impact of cash flow hedge derivatives on exchange risk on equity during the period, gross of
tax effects.
Millions of euro
Opening balance at January 1
Changes in fair value recognized in equity (OCI)
Changes in fair value recognized in profit or loss - recycling
Changes in fair value recognized in profit or loss - ineffective portion
Closing balance at December 31
2015
(310)
-
102
-
(208)
2014
(242)
-
(68)
-
(310)
33.2 Derivatives at fair value through profit or loss
The following table shows the notional amount and the fair value of derivatives at FVTPL as at December 31, 2015 and De-
cember 31, 2014.
Millions of euro
Notional amount
Fair value assets
Notional amount
Fair value liabilities
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
at Dec. 31,
2015
at Dec. 31,
2014
Derivatives at FVTPL on
interest rates:
- interest rate swaps
Derivatives at FVTPL on
exchange rates:
- forwards
- cross currency interest
rate swaps
Total derivatives at
FVTPL
9,918
9,918
3,157
3,157
14,817
14,058
5,694
5,609
415
415
1,552
308
378
378
1,186
364
10,055
10,055
3,296
3,296
(486)
(486)
(460)
(460)
14,817
14,058
(1,568)
(1,194)
5,694
5,609
(311)
(369)
9,123
8,449
1,244
822
9,123
8,449
(1,257)
(825)
24,735
17,215
1,967
1,564
24,872
17,354
(2,054)
(1,654)
At December 31, 2015 the notional amount of derivatives at
hedges of the debt of the Group companies with the market
fair value through profit or loss on interest rates and foreign
and intermediated in the same notional amount with those
exchange rates came to €49,607 million (€34,569 million at
companies in the amount of €9,918 million.
December 31, 2014), corresponding to a negative fair value
The overall change in the notional amount and the fair value
of €87 million (negative €90 million at December 31, 2014).
of interest rate swaps (respectively, a positive €13,520 mil-
Interest rate swaps at the end of the year refer primarily to
lion and a positive €11 million) compared with the previous
361
Separate financial statements of Enel SpAAnnual Report 2015 year is attributable to new transactions closed as part of
The change in the notional amount and the fair value as
the pre-hedge strategy for future bond issues in 2017-2018
compared with the previous year is associated with normal
and 2019-2020, designed to set the cost of future funding in
operations.
advance and to the general decline in the interest rate yield
Cross currency interest rate swaps, with a notional amount
curve over the course of the year.
of €9,123 million, relate to hedges of exchange risk on the
Forward contracts, with a notional amount of €5,694 million,
debt of the Group companies denominated in currencies
relate mainly to OTC derivatives entered into to mitigate the
other than the euro and matched with market transactions.
exchange risk associated with the prices of energy commo-
The change in the notional amount and the fair value of the
dities within the provisioning process of Group companies
cross currency interest rate swaps is mainly due to deve-
and matched with market transactions. They also hedge the
lopments in the exchange rate of the euro with other major
expected cash flows in currencies other than the currency of
currencies and the normal expiry of certain derivatives du-
account connected with the acquisition of non-energy com-
ring 2015.
modities.
362
Annual Report 2015 34. Fair value measurement
The Company measures fair value in accordance with IFRS
market is determined using valuation methods appropriate
13 whenever required by international accounting stan-
for each type of financial instrument and market data as of
dards.
the close of the period (such as interest rates, exchange
Fair value is defined as the price that would be received to
rates, volatility), discounting expected future cash flows on
sell an asset or paid to transfer a liability. The best estimate
the basis of the market yield curve and translating amounts
is the market price, i.e. its current price, publicly available
in currencies other than the euro using exchange rates pro-
and effectively traded on an active, liquid market.
vided by the European Central Bank. For contracts invol-
The fair value of assets and liabilities is categorized into
ving commodities, the measurement is conducted using
a fair value hierarchy that provides three levels defined as
prices, where available, for the same instruments on both
follows on the basis of the inputs to valuation techniques
regulated and unregulated markets.
used to measure fair value:
In accordance with the new international accounting stan-
> Level 1: quoted prices (unadjusted) in active markets for
dards, in 2013 the Group included a measurement of credit
identical assets or liabilities to which the Company has
risk, both of the counterparty (Credit Valuation Adjustment
access at the measurement date;
or CVA) and its own (Debit Valuation Adjustment or DVA),
> Level 2: inputs other than quoted prices included within
in order to adjust the fair value of financial instruments for
Level 1 that are observable for the asset or liability, either
the corresponding amount of counterparty risk.
directly (that is, as prices) or indirectly (that is, derived
More specifically, the Group measures CVA/DVA using a
from prices);
Potential Future Exposure valuation technique for the net
> Level 3: inputs for the asset or liability that are not based
exposure of the position and subsequently allocating the
on observable market data (that is, unobservable inputs).
adjustment to the individual financial instruments that
In this note, the relevant disclosures are provided in order
make up the overall portfolio. All of the inputs used in this
to assess the following:
technique are observable on the market. Changes in the
> for assets and liabilities that are measured at fair value on
assumptions underlying the estimated inputs could have
a recurring or non-recurring basis in the balance sheet af-
an effect on the fair value reported for such instruments.
ter initial recognition, the valuation techniques and inputs
The notional amount of a derivative contract is the amount
used to develop those measurements; and
on which cash flows are exchanged. This amount can be
> for recurring fair value measurements using significant
expressed as a value or a quantity (for example tons, con-
unobservable inputs (Level 3), the effect of the measure-
verted into euros by multiplying the notional amount by the
ments on profit or loss or other comprehensive income
agreed price).
for the period.
For this purpose:
Amounts denominated in currencies other than the euro
are converted into euros at the exchange rate provided by
> recurring fair value measurements are those that IFRSs
the European Central Bank.
require or permit in the balance sheet at the end of each
The notional amounts of derivatives reported here do not
reporting period;
necessarily represent amounts exchanged between the
> non-recurring fair value measurements are those that
parties and therefore are not a measure of the Company’s
IFRSs require or permit in the balance sheet in particular
credit risk exposure.
circumstances.
For listed debt instruments, the fair value is given by official
prices. For unlisted instruments the fair value is determined
The fair value of derivative contracts is determined using
using appropriate valuation techniques for each category of
the official prices for instruments traded on regulated mar-
financial instrument and market data at the closing date of
kets. The fair value of instruments not listed on a regulated
the year, including the credit spreads of Enel SpA.
363
Separate financial statements of Enel SpAAnnual Report 2015 34.1 Assets measured at fair value in the balance sheet
The following table shows, for each class of assets measu-
reporting period and the level in the fair value hierarchy into
red at fair value on a recurring or non-recurring basis in the
which the fair value measurements are categorized.
balance sheet, the fair value measurement at the end of the
Millions of euro
Non-current assets
Current assets
Fair value
at Dec. 31,
2015
Notes
Level 1
Level 2
Level 3
Fair value
at Dec. 31,
2015
Level 1
Level 2
Level 3
Derivatives
Cash flow hedge
derivatives:
- on exchange risk
33
Total
Fair value hedge
derivatives:
- on interest rate risk
33
Total
Fair value through profit
or loss:
- on interest rate risk
- on exchange risk
33
33
Total
TOTAL
888
888
35
35
413
1,255
1,668
2,591
-
-
-
-
-
-
-
-
888
888
35
35
413
1,255
1,668
2,591
-
-
-
-
-
-
-
-
-
-
-
-
2
297
299
299
-
-
-
-
-
-
-
-
-
-
-
-
2
297
299
299
-
-
-
-
-
-
-
-
34.2 Liabilities measured at fair value in the balance sheet
The following table reports, for each class of liabilities me-
end of the reporting period and the level in the fair value
asured at fair value on a recurring or non-recurring basis
hierarchy into which the fair value measurements are ca-
in the balance sheet, the fair value measurement at the
tegorized.
Millions of euro
Non-current liabilities
Current liabilities
Fair value
at Dec. 31,
2015
Notes
Level 1
Level 2
Level 3
Fair value
at Dec. 31,
2015
Level 1
Level 2
Level 3
Derivatives
Cash flow hedge
derivatives:
- on interest rate risk
- on exchange risk
Total
Fair value through profit
or loss:
- on interest rate risk
- on exchange risk
Total
TOTAL
33
33
33
33
143
887
1,030
419
1,268
1,687
2,717
-
-
-
-
-
-
-
143
887
1,030
419
1,268
1,687
2,717
-
-
-
-
-
-
-
-
-
-
67
300
367
367
-
-
-
-
-
-
-
-
-
-
67
300
367
367
-
-
-
-
-
-
-
364
Annual Report 2015 34.3 Liabilities not measured at fair value in the balance sheet
The following table shows, for each class of liabilities not
reporting period and the level in the fair value hierarchy into
measured at fair value in the balance sheet but for which the
which the fair value measurements are categorized.
fair value shall be disclosed, the fair value at the end of the
Millions of euro
LIABILITIES
Fair value at Dec. 31,
2015
Notes
Level 1
Level 2
Level 3
Bonds:
- fixed rate
- floating rate
Total
31.2.1
31.2.1
17,001
2,931
19,932
17,001
1,737
18,738
-
1,194
1,194
-
-
-
35. Related parties
Related parties have been identified on the basis of the
accordance with procedural and substantive propriety.
provisions of international accounting standards and the
applicable CONSOB measures.
In November 2010, the Board of Directors of Enel SpA ap-
proved a procedure governing the approval and execution
The transactions Enel SpA entered into with its subsidiari-
of transactions with related parties carried out by Enel SpA
es mainly involved the provision of services, the sourcing
directly or through subsidiaries. The procedure (available at
and employment of financial resources, insurance covera-
http://www.enel.com/en-GB/governance/rules/related_par-
ge, human resource management and organization, legal
ties/) sets out rules designed to ensure the transparency
and corporate services, and the planning and coordination
and procedural and substantive propriety of transactions
of tax and administrative activities.
with related parties. It was adopted in implementation of
All the transactions are part of routine operations, are carri-
and the implementing regulations issued by CONSOB. In
ed out in the interest of the Company and are settled on an
2015, no transactions were carried out for which it was ne-
arm’s length basis, i.e. on the same market terms as agree-
cessary to make the disclosures required in the rules on
ments entered into between two independent parties.
transactions with related parties adopted with CONSOB
the provisions of Article 2391-bis of the Italian Civil Code
Resolution 17221 of March 12, 2010, as amended with Re-
Finally, the Enel Group’s corporate governance rules, which
solution 17389 of June 23, 2010.
are discussed in greater detail in the Report on Corporate
Governance and Ownership Structure available on the Com-
The following tables summarize commercial, financial and
pany’s website (www.enel.com), establish conditions for en-
other relationships between the Company and related parties.
suring that transactions with related parties are performed in
365
Separate financial statements of Enel SpAAnnual Report 2015 Commercial and other relationships
2015
Millions of euro
Receivables
Payables
Goods
Services
Goods
Services
at Dec. 31, 2015 at Dec. 31, 2015
2015
2015
Costs
Revenue
Subsidiaries:
Central Geradora Termelétrica
Fortaleza SA
Edegel SA
Empresa de Distribución Eléctrica de
Lima Norte SAA
Enel Brasil SA
Endesa Distribución Eléctrica SL
Endesa Generación SA
Enel Latinoamérica SA
Endesa SA
Enel Distributie Banat SA
Enel Distributie Dobrogea SA
Enel Distributie Muntenia SA
Enel Distribuzione SpA
Enel Energia SpA
Enel Iberoamérica SL
Enel France Sas
Enel Green Power SpA
Enel Green Power
North America Inc.
Enel Ingegneria e Ricerca SpA
Enel Russia PJSC
Enel Produzione SpA
Enel Romania Srl
Enel Italia Srl
Enel Servizio Elettrico SpA
Enel Sole Srl
Enel Trade SpA
Enel.Factor SpA
Enel Insurance NV
Enel.si Srl
Enelpower SpA
Endesa Energía SA
Enersis SA
Gas y Electricidad Generación SAU
Nuove Energie Srl
Slovenské elektrárne AS
Unión Eléctrica de Canarias
Generación SAU
Total
Other related parties:
GSE
Fondazione Centro Studi Enel
Total
TOTAL
366
1
2
3
15
19
3
-
-
1
1
3
361
102
1
2
17
1
2
18
132
4
84
57
2
5
-
1
1
-
4
3
1
-
16
1
863
1
-
1
-
-
-
-
1
-
-
1
-
-
-
167
26
8
1
115
1
6
4
153
-
64
13
3
85
2
-
2
3
-
-
-
1
-
-
656
-
-
-
864
656
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1
-
1
3
-
-
-
-
-
9
-
-
-
-
-
-
-
58
-
1
-
-
-
-
-
-
-
-
-
-
-
73
-
-
-
73
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1
2
2
15
8
5
-
-
1
1
2
45
7
1
-
16
-
1
7
23
1
80
4
1
4
-
-
-
-
4
2
2
-
7
1
243
-
1
1
244
Annual Report 2015 2014
Millions of euro
Receivables
Payables
Goods
Services
Goods
Services
at Dec. 31, 2014 at Dec. 31, 2014
2014
2014
Costs
Revenue
Subsidiaries:
Endesa Distribución Eléctrica SL
Endesa Generación SA
Enel Latinoamérica SA
Endesa SA
Enel Distributie Banat SA
Enel Distributie Dobrogea SA
Enel Distributie Muntenia SA
Enel Distribuzione SpA
Enel Energia SpA
Enel Iberoamérica SL
Enel France Sas
Enel Green Power Partecipazioni Speciali Srl
Enel Green Power SpA
Enel Green Power España SL
Enel Green Power North America Inc.
Enel Ingegneria e Ricerca SpA
Enel Longanesi Developments Srl
Enel Russia PJSC
Enel Produzione SpA
Enel Romania Srl
Enel Italia Srl
Enel Servizio Elettrico SpA
Enel Sole Srl
Enel Trade SpA
Enel.Factor SpA
Enel Insurance NV
Enel.si Srl
Enelpower SpA
Endesa Energía SA
Gas y Electricidad Generación SAU
Nuove Energie Srl
Slovenské elektrárne AS
Sviluppo Nucleare Italia Srl
Unión Eléctrica de Canarias Generación SAU
Total
Other related parties:
GSE
Total
TOTAL
16
(2)
-
-
-
-
1
146
109
1
2
-
41
-
1
8
-
16
88
4
22
6
3
18
-
1
7
-
6
-
-
17
-
-
511
1
1
512
-
-
1
4
-
-
-
289
4
-
1
2
10
-
1
3
1
4
169
-
47
74
-
105
13
-
2
3
-
-
1
-
3
-
737
1
1
738
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1
5
-
-
-
-
-
-
-
-
-
-
-
(1)
-
1
-
-
49
-
-
-
-
-
-
-
-
-
-
-
3
-
58
-
-
58
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
16
3
(3)
1
1
1
1
73
59
1
-
-
21
(2)
-
2
-
4
33
-
1
8
4
3
-
1
1
-
6
1
1
6
-
2
245
-
-
245
367
Separate financial statements of Enel SpAAnnual Report 2015 Financial relationships
2015
Millions of euro
Receivables
Payables
Guarantees
Costs
Revenue
Dividends
at Dec. 31, 2015
2015
165
9
1
1,459
-
107
-
-
331
1
1
28
1
119
101
1,017
17
-
47
123
-
4
-
-
13
-
890
395
-
3,719
1,087
-
2
-
-
2,432
21,846
1,533
-
-
3
-
7
3
87
-
-
648
84
-
-
-
364
2
15
-
36
-
-
2
-
-
-
51
1,804
33
376
2
1
2,415
73
1,798
110
8
1,560
-
1
36
1
8
86
-
1
-
-
1
67
1
-
-
-
145
-
-
-
-
497
2
-
-
-
-
-
-
48
10
1
48
2
13
2
2
1,245
159
500
-
-
-
-
-
132
109
2
1
-
-
36
6
8
1
-
347
2
-
-
-
-
-
-
-
-
-
-
-
9
-
-
-
-
-
-
-
-
-
-
-
3,544
4,968
35,015
2,249
661
2,022
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1
1
2
3,544
4,968
35,015
2,249
661
2,024
Subsidiaries:
Enel Distribuzione SpA
Enel Energia SpA
Enel Iberoamérica SL
Enel Finance International NV
Enel Green Power Chile Ltda
Enel Green Power International BV
Enel Green Power México
S de RL de Cv
Enel Green Power
North America Inc.
Enel Green Power SpA
Enel Ingegneria e Ricerca SpA
Enel Investment Holding BV
Enel Longanesi Developments Srl
Enel M@P Srl
Enel Produzione SpA
Enel Italia Srl
Enel Servizio Elettrico SpA
Enel Sole Srl
Enel Trade Romania Srl
Enel Trade SpA
Enel.Factor SpA
Enel.Newhydro Srl
Enel.si Srl
Enelpower SpA
Marcinelle Energie SA
Nuove Energie Srl
Enel Oil & Gas SpA
Total
Other related parties:
Emittenti Titoli SpA
CESI SpA
Total
TOTAL
368
Annual Report 2015
-
189
8
2
173
-
32
1
1
-
71
5
3
-
-
35
6
8
3
-
115
2
-
-
-
-
-
-
-
-
1,373
16
-
-
-
-
-
-
-
109
-
-
-
-
223
7
85
-
-
-
3
-
-
1
-
-
-
-
2014
Millions of euro
Receivables
Payables
Guarantees
Costs
Revenue
Dividends
at Dec. 31, 2014
2014
Subsidiaries:
Concert Srl
Enel Distribuzione SpA
Enel Energia SpA
Enel Iberoamérica SL
-
218
11
2
2
1,258
-
2
-
4,005
1,009
-
-
1
-
-
Enel Finance International NV
1,714
3,105
25,522
750
Enel France Sas
Enel Green Power International BV
Enel Green Power México S de RL de Cv
Enel Green Power North America Inc.
Enel Green Power Romania Srl
Enel Green Power SpA
Enel Ingegneria e Ricerca SpA
Enel Investment Holding BV
Enel Longanesi Developments Srl
Enel M@P Srl
Enel Produzione SpA
Enel Italia Srl
Enel Servizio Elettrico SpA
Enel Sole Srl
Enel Trade Romania Srl
Enel Trade SpA
Enel.Factor SpA
Enel.Newhydro Srl
Enel.si Srl
Enelpower SpA
Marcinelle Energie SA
Nuove Energie Srl
PH Chucas SA
Sviluppo Nucleare Italia Srl
Total
Other related parties:
CESI SpA
Total
TOTAL
-
98
23
14
5
67
98
1
27
1
137
102
1,242
41
-
1,231
160
-
5
-
-
5
7
-
5,209
-
-
-
-
-
-
-
9
-
88
-
-
112
200
-
-
-
26
-
-
45
-
1,543
67
365
1
5
2,691
91
1,660
111
6
-
1
-
2
-
3
-
-
-
-
129
-
-
-
-
239
1,424
286
-
6
36
1
9
86
-
4
-
-
-
-
-
-
-
-
-
16
-
34
-
-
-
11
5,076
-
-
38,713
1,172
654
1,817
-
-
-
-
-
-
1
1
5,209
5,076
38,713
1,172
654
1,818
The impact of transactions with related parties on the balance sheet, income statement and cash flows is reported in the
following tables.
369
Separate financial statements of Enel SpAAnnual Report 2015 Impact on balance sheet
Millions of euro
Total Related parties
% of total
Total Related parties
% of total
at Dec. 31, 2015
at Dec. 31, 2014
Assets
Derivatives - non-current
Other non-current financial assets
Other non-current assets
Trade receivables
Derivatives - current
Other current financial assets
Other current assets
Liabilities
Derivatives - non-current
Other non-current liabilities
Short-term borrowings
Trade payables
Derivatives - current
Other current financial liabilities
Other current liabilities
2,591
107
409
283
299
3,403
460
2,717
243
4,914
164
367
643
1,046
317
71
164
278
26
3,130
422
1,365
243
3,243
59
276
84
354
12.2%
66.4%
40.1%
98.2%
8.7%
92.0%
91.7%
50.2%
100.0%
66.0%
36.0%
75.2%
13.1%
33.8%
1,979
146
467
132
280
5,040
244
2,484
287
4,746
139
359
694
975
819
117
177
127
50
4,223
208
469
287
4,319
55
234
54
396
41.4%
80.1%
37.9%
96.2%
17.9%
83.8%
85.2%
18.9%
100.0%
91.0%
39.6%
65.2%
7.8%
40.6%
Impact on income statement
Millions of euro
Total Related parties
% of total
Total Related parties
% of total
2015
2014
245
399
2,024
3,358
177
3,024
1,243
244
73
99.6%
18.3%
2,024
100.0%
500
161
2,248
1
14.9%
91.0%
74.3%
0.1%
246
324
1,818
2,190
222
1,954
1,377
245
58
99.6%
17.9%
1,818
100.0%
460
194
1,169
3
21.0%
87.4%
59.8%
0.2%
Revenue
Services and other operating expenses
Income from equity investments
Financial income on derivatives
Other financial income
Financial expense on derivatives
Other financial expense
Impact on cash flows
Millions of euro
Total Related parties
% of total
Total Related parties
% of total
Cash flows from operating activities
1,062
1,092
102.8%
Cash flows from investing/disinvesting
activities
Cash flows from financing activities
(560)
(1,549)
(559)
29
99.8%
-1.9%
2015
2014
667
(10)
926
(11)
2,934
2,682
72.0%
90.9%
91.4%
370
Annual Report 2015 36. Contractual commitments and
guarantees
Millions of euro
Sureties and guarantees given:
- third parties
- subsidiaries
Total
at Dec. 31, 2015
at Dec. 31, 2014
376
35,015
35,391
405
38,713
39,118
Change
(29)
(3,698)
(3,727)
Sureties granted to third parties regard guarantees issued by
> €525 million issued to INPS on behalf of various Group
the Parent Company as part of the disposal to third parties of
companies whose employees elected to participate in the
assets owned by Enel SpA or in the interest of its subsidiari-
structural staff reduction plan (Article 4 of Law 92/2012);
es and they essentially regard the sale of real estate assets
> €495 million issued to Terna on behalf of Enel Distribuzio-
(€375 million). The guarantee is meant to ensure the perfor-
ne, Enel Trade, Enel Produzione and Enel Energia in re-
mance of contractual obligations, specifically payments due
spect of agreements for electricity transmission services;
and the commitment to renew at least 50% of the long-term
> €387 million issued to Snam Rete Gas on behalf of Enel
lease agreements for six years.
Trade for gas transport capacity;
> €365 million as counter-guarantees in favor of the banks
Sureties issued on behalf of subsidiaries include:
that guaranteed the Energy Markets Operator (GME) on
> €21,748 million issued on behalf of Enel Finance Interna-
behalf of Enel Trade and Enel Produzione;
tional securing bonds denominated in dollars, pounds, eu-
> €364 million issued to financial counterparties on behalf
ros and yen as part of the €35 billion Global Medium-Term
of Enel Investment Holding securing bonds as part of the
Notes Program;
€35 billion Global Medium-Term Notes Program;
> €3,050 million issued to the European Investment Bank
> €97 million issued on behalf of Enel Finance International
(EIB) for loans granted to Enel Distribuzione, Enel Produ-
to secure the Euro Commercial Paper program;
zione and Enel Green Power;
> €80 million issued to RWE Supply & Trading GmbH on be-
> €2,046 million issued to the tax authorities in respect
half of Enel Trade for electricity purchases;
of participation in the Group VAT procedure on behalf of
> €50 million issued to E.ON on behalf of Enel Trade for tra-
Enel.Newhydro, Enel Trade, Enel Produzione, Enelpower,
ding on the electricity market;
Enel Servizio Elettrico, Nuove Energie, Enel Ingegneria e
> €32 million issued to Wingas GmbH & CO.KG on behalf of
Ricerca, Enel M@p, Enel.si, Enel Green Power, Enel Sole
Enel Trade for the supply of gas;
and Enel Longanesi Developments;
> €3,218 million issued to various beneficiaries as part of
> €1,407 million in favor of Cassa Depositi e Prestiti issued
financial support activities by the Parent Company on be-
on behalf of Enel Distribuzione, which received the Enel
half of subsidiaries.
Grid Efficiency II loan;
> €1,150 million issued by Enel SpA to the Acquirente Unico
In its capacity as the Parent Company, Enel SpA has also
(Single Buyer) on behalf of Enel Servizio Elettrico for obli-
granted letters of patronage to a number of Group compa-
gations under the electricity purchase contract;
nies, essentially for assignments of receivables.
37. Contingent liabilities and assets
Please see note 49 to the consolidated financial statements for information on contingent liabilities and asset.
371
Separate financial statements of Enel SpAAnnual Report 2015 38. Events after the reporting date
Please see note 50 to the consolidated financial statements for information on events after the reporting date.
39. Fees of audit firm pursuant to Article
149-duodecies of the CONSOB “Issuers
Regulation”
Fees paid in 2015 to the audit firm and entities belonging
table, pursuant to the provisions of Article 149-duodecies of
to its network for services are summarized in the following
the CONSOB “Issuers Regulation”.
Entity providing the service
Fees (millions of euro)
of which:
- Reconta Ernst & Young SpA
- Entities of Ernst & Young network
of which:
- Reconta Ernst & Young SpA
- Entities of Ernst & Young network
of which:
- Reconta Ernst & Young SpA
- Entities of Ernst & Young network
of which:
- Reconta Ernst & Young SpA
- Entities of Ernst & Young network
of which:
- Reconta Ernst & Young SpA
- Entities of Ernst & Young network
of which:
- Reconta Ernst & Young SpA
- Entities of Ernst & Young network
of which:
- Reconta Ernst & Young SpA
- Entities of Ernst & Young network
1.6
-
0.6
-
0.5
-
2.7
2.3
12.6
0.6
3.9
-
0.5
-
0.5
20.4
23.1
Type of service
Enel SpA
Auditing
Certification services
Other services
Total
Enel SpA subsidiaries
Auditing
Certification services
Tax advisory
Other services
Total
TOTAL
372
Annual Report 2015 373
Separate financial statements of Enel SpAAnnual Report 2015 Declaration of the Chief
Executive Officer and the officer
responsible for the preparation of
the Company financial reports
374
Annual Report 2015 Declaration of the Chief Executive Officer and the officer responsible for the preparation
of the financial reports of Enel SpA at December 31, 2015, pursuant to the provisions of
Article 154-bis, paragraph 5, of Legislative Decree 58 of February 24, 1998 and Article
81-ter of CONSOB Regulation 11971 of May 14, 1999
1. The undersigned Francesco Starace and Alberto De Paoli, in their respective capacities as Chief Executive Officer and
officer responsible for the preparation of the financial reports of Enel SpA, hereby certify, taking account of the provi-
sions of Article 154-bis, paragraphs 3 and 4, of Legislative Decree 58 of February 24, 1998:
a. the appropriateness with respect to the characteristics of the Company and
b. the effective adoption of the administrative and accounting procedures for the preparation of the separate financial
statements of Enel SpA in the period between January 1, 2015 and December 31, 2015.
2. In this regard, we report that:
a. the appropriateness of the administrative and accounting procedures used in the preparation of the separate finan-
cial statements of Enel SpA has been verified in an assessment of the internal control system for financial repor-
ting. The assessment was carried out on the basis of the guidelines set out in the “Internal Controls - Integrated
Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO);
b. the assessment of the internal control system for financial reporting did not identify any material issues.
3. In addition, we certify that separate financial statements of Enel SpA at December 31, 2015:
a. have been prepared in compliance with the international accounting standards recognized in the European Union
pursuant to Regulation 2002/1606/EC of the European Parliament and of the Council of July 19, 2002;
b. correspond to the information in the books and other accounting records;
c. provide a true and fair representation of the performance and financial position of the issuer.
4. Finally, we certify that the report on operations, included in the Annual Report 2015 and accompanied by the financial
statements of Enel SpA at December 31, 2015, contains a reliable analysis of operations and performance, as well as
the situation of the issuer, together with a description of the main risks and uncertainties to which it is exposed.
Rome, March 22, 2016
Francesco Starace
Alberto De Paoli
Chief Executive Officer of Enel SpA
Officer responsible for the preparation
of the financial reports of Enel SpA
375
Declaration of the Chief Executive Officer and the officer responsibleAnnual Report 2015 Reports
376
Annual Report 2015 377
ReportsAnnual Report 2015 Report of the Board of Auditors
to the Shareholders’ Meeting of
Enel SpA
378
Annual Report 2015 Report of the Board of Auditors to the Shareholders’ Meeting of Enel SpA (pursuant to
Article 153 of Legislative Decree 58/1998)
Shareholders,
During the year ended December 31, 2015 we performed the oversight activities envisaged by law at Enel SpA (hereinafter
also “Enel” or the “Company”). In particular, pursuant to the provisions of Article 149, paragraph 1, of Legislative Decree 58
of February 24, 1998 (hereinafter the “Consolidated Law on Financial Intermediation”) and Article 19, paragraph 1 of Legisla-
tive Decree 39 of January 27, 2010 (hereinafter “Decree 39/2010”) we monitored:
> compliance with the law and the corporate bylaws as well as compliance with the principles of sound administration in
the performance of the Company's business;
> the Company’s financial reporting process and the adequacy of the administrative and accounting system, as well as the
reliability of the latter in representing operational events;
> the statutory audit of the annual statutory and consolidated accounts and the independence of the audit firm;
> the adequacy and effectiveness of the internal control and risk management system;
> the adequacy of the organizational structure of the Company, within the scope of our responsibilities;
> the implementation of the corporate governance rules as provided for by the Corporate Governance Code for Listed Com-
panies (hereinafter, the “Corporate Governance Code”), which the Company has adopted;
> the appropriateness of the instructions given by the Company to its subsidiaries to enable it to meet statutory market
disclosure requirements.
In performing our checks and assessments of the above issues, we did not find any particular issues to report.
In compliance with the instructions issued by CONSOB with Communication DEM/1025564 of April 6, 2001, as amended,
we report the following:
> we monitored compliance with the law and the bylaws and we have no issues to report;
> on a quarterly basis, we received adequate information from the Chief Executive Officer, as well as through our participa-
tion in the meetings of the Board of Directors of Enel, on activities performed, general developments in operations and
the outlook, and on transactions with the most significant impact on performance or the financial position carried out by
the Company and its subsidiaries. We report that the actions approved and implemented were in compliance with the law
and the bylaws and were not manifestly imprudent, risky, in potential conflict of interest or in contrast with the resolutions
of the Shareholders’ Meeting or otherwise prejudicial to the integrity of the Company’s assets. For a discussion of the
features of the most significant transactions, please see the report on operations accompanying the separate financial
statements of the Company for 2015 and the consolidated financial statements of the Enel Group for 2015 (in the section
“Significant events in 2015”);
> we did not find any atypical or unusual transactions conducted with third parties, Group companies or other related par-
ties;
> in the section “Related parties” of the notes to the separate 2015 financial statements of the Company, the directors
describe the main related-party transactions – identified on the basis of international accounting standards and the in-
structions of CONSOB – carried out by the Company, to which readers may refer for details on the transactions and their
financial impact. They also detail the procedures adopted to ensure that related-party transactions are carried out in accor-
dance with the principles of transparency and procedural and substantive fairness. The transactions were carried out in
compliance with the approval and execution processes set out in the related procedure – adopted in compliance with the
provisions of Article 2391-bis of the Italian Civil Code and the implementing regulations issued by CONSOB – described in
the Report on Corporate Governance and Ownership Structure for 2015. All transactions with related parties reported in
the notes to the separate 2015 financial statements of the Company were executed as part of ordinary operations in the
interest of the Company and settled on market terms and conditions;
> the Company declares that it has prepared its statutory financial statements for 2015 on the basis of international ac-
counting standards (IAS/IFRS) – and the interpretations issued by the IFRIC and the SIC – endorsed by the European
Union pursuant to Regulation 1606/2002/EC and in force at the close of 2015, as well as the provisions of Legislative De-
379
ReportsAnnual Report 2015 cree 38 of February 28, 2005 and its related implementing measures, as it did the previous year. The Company’s separate
financial statements for 2015 have been prepared on a going-concern basis using the cost method, with the exception of
items that are measured at fair value under the IFRS-EU, as indicated in the accounting policies for the individual items
of the consolidated financial statements. The notes to the Company’s separate financial statements also refer readers to
the consolidated financial statements for information on the accounting standards and measurement criteria adopted,
with the exception of equity investments in subsidiaries and associates, which are carried in the Company’s separate
financial statements at purchase costs adjusted for any impairment losses. The notes to the Company’s separate finan-
cial statements also refer readers to the consolidated financial statements for information on recently issued accounting
standards. The separate financial statements for 2015 of the Company were audited by the independent auditors Reconta
Ernst & Young SpA, which issued an unqualified opinion, including with regard to the consistency of the report on opera-
tions with the financial statements, pursuant to Article 14 of Decree 39/2010;
> the Company declares that it has also prepared the consolidated financial statements of the Enel Group for 2015 on the ba-
sis of international accounting standards (IAS/IFRS) – and the interpretations issued by the IFRIC and the SIC – endorsed
by the European Union pursuant to Regulation 1606/2002/EC and in force at the close of 2015, as well as the provisions of
Legislative Decree 38 of February 28, 2005 and its related implementing measures, as it did the previous year. The 2015
consolidated financial statements of the Enel Group are also prepared on a going-concern basis using the cost method,
with the exception of items that are measured at fair value under the IFRS-EU (as indicated in the discussion of measu-
rement criteria for the individual items) and non-current assets (or disposal groups) classified as held for sale, which are
measured at the lower of carrying amount and fair value less costs to sell. The notes to the consolidated financial state-
ments provide a detailed discussion of the accounting standards and measurement criteria adopted. As regards recently
issued accounting standards, the notes to the consolidated financial statements discuss (i) new standards applied in 2015,
which according to the notes did not have a material impact in the year under review, with the exception of the “IFRIC 11
- Levies”, which, while not giving rise to any restatement of comparative figures on an annual basis, did involve a number
of changes in the interim income statement; and (ii) standards that will apply in the future. The consolidated financial sta-
tements for 2015 of the Enel Group were audited by the independent auditors Reconta Ernst & Young SpA, which issued
an unqualified opinion, including with regard to the consistency of the report on operations with the consolidated financial
statements, pursuant to Article 14 of Decree 39/2010.
Under the terms of its engagement, Reconta Ernst & Young SpA also issued unqualified opinions on the financial state-
ments for 2015 of the most significant Italian companies of the Enel Group. Moreover, during periodic meetings with the
representatives of the audit firm, Reconta Ernst & Young SpA, the latter did not raise any issues concerning the reporting
packages of the main foreign companies of the Enel Group, selected by them on the basis of the work plan established
for the auditing of the consolidated financial statements of the Enel Group, that would have a sufficiently material impact
to be reported in the opinion on those financial statements;
> taking due account of the recommendations of the European Securities and Markets Authority issued on January 21, 2013,
and most recently confirmed with the Public Statement of October 27, 2015, to ensure greater transparency concerning the
methods used by listed companies in testing goodwill for impairment, in line with the recommendations contained in the
joint Bank of Italy - CONSOB - ISVAP document 4 of March 3, 2010, and in the light of indications of CONSOB in its Commu-
nication 7780 of January 28, 2016, the compliance of the impairment testing procedure with the provisions of IAS 36 was
expressly approved by the Board of Directors of the Company, having obtained a favorable opinion in this regard from the
Control and Risk Committee in February 2016, i.e. prior to the date of approval of the financial statements for 2015;
> we examined the Board of Directors’ proposal for the allocation of net income for 2015 and the distribution of available
reserves and have no comments in this regard;
> we note that the Board of Directors of the Company certified, following appropriate checks by the Control and Risk Com-
mittee, that as at the date on which the 2015 financial statements were approved, the Enel Group continued to meet the
conditions established by CONSOB (set out in Article 36 of the Market Rules, approved with Resolution 16191 of October
29, 2007 as amended) concerning the accounting transparency and adequacy of the organizational structures and internal
control systems that subsidiaries established and regulated under the law of non-EU countries must comply with so that
Enel shares can continue to be listed on regulated markets in Italy;
380
Annual Report 2015 > we monitored, within the scope of our responsibilities, the adequacy of the organizational structure of the Company (and
the Enel Group as a whole), obtaining information from department heads and in meetings with the boards of auditors
or equivalent bodies of a number of the main Enel Group companies in Italy and abroad, for the purpose of the reciprocal
exchange of material information. As from the second half of 2014, the organizational structure of the Enel Group is based
on a matrix of Divisions and geographical areas. It is organized into: (i) Divisions, which are responsible for managing and
developing assets, optimizing their performance and the return on capital employed in the various geographical areas in
which the Group operates. The Divisions comprise: Global Infrastructure and Networks, Global Generation, Renewable
Energy, Global Trading and Upstream Gas (note that the latter two Divisions were merged in March 2016); (ii) Areas and
Countries, which are responsible for managing relationships with local institutional bodies and regulatory authorities, as
well as selling electricity and gas, in each of the countries in which the Group is present, while also providing staff and
other service support to the divisions. Areas and Countries comprise: Italy, Iberian Peninsula, Latin America, Eastern
Europe; (iii) Global service functions, which are responsible for managing information and communication technology
activities and procurement at the Group level; and (iv) Holding company functions, which are responsible for managing
governance processes at the Group level. They include: Administration, Finance and Control, Human Resources and Or-
ganization, Communication, Legal and Corporate Affairs, Audit, European Affairs, and Innovation and Sustainability. The
Board of Auditors feels that the organizational system described above is adequate to support the strategic development
of the Company and the Enel Group and is consistent with control requirements;
> during meetings with the boards of auditors or equivalent bodies of a number of the Group’s main companies in Italy and
abroad, no material issues emerged that would require reporting here;
> we monitored the independence of the audit firm Reconta Ernst & Young SpA, having received from them specific writ-
ten confirmation that they met that requirement (pursuant to the provisions of Article 17, paragraph 9, letter a) of Decree
39/2010) and having discussed the substance of that declaration with the audit partner. In this regard, we also monitored
– as provided for under Article 19, paragraph 1(d), of Decree 39/2010 – the nature and the scale of non-audit services
provided to the Company and other Enel Group companies by Reconta Ernst & Young SpA and the entities belonging
to its network, the fees for which are reported in the notes to the financial statements of the Company. Following our
examinations, the Board of Auditors feels that there are no critical issues concerning the independence of the audit firm
Reconta Ernst & Young SpA. We held periodic meetings with the representatives of the audit firm, pursuant to Article 150,
paragraph 3, of the Consolidated Law on Financial Intermediation, and no material issues emerged that would require
mention in this report.
As regards the provisions of Article 19, paragraph 3, of Decree 39/2010, Reconta Ernst & Young SpA provided the Board
of Auditors with the report for 2015 “on key issues emerging during the statutory audit”, which did not find any significant
shortcomings in the internal control system concerning financial reporting. The audit firm also reported that, as it perfor-
med its engagement, it provided suggestions concerning a number of issues that, after being agreed with the competent
units of the Company, enabled improvements to be implemented. The audit firm also reported that it did not prepare any
management letter for 2015;
> we monitored the financial reporting process, the appropriateness of the administrative and accounting system and its
reliability in representing operational events, as well as compliance with the principles of sound administration in the per-
formance of the Company’s business and we have no comments in that regard. We conducted our checks by obtaining
information from the head of the Administration, Finance and Control department (taking due account of the head’s role
as the officer responsible for the preparation of the Company’s financial reports), examining Company documentation
and analyzing the findings of the examination performed by Reconta Ernst & Young SpA. The Chief Executive Officer and
the officer responsible for the preparation of the financial reports of Enel issued a statement (regarding the Company’s
2015 financial statements) certifying (i) the appropriateness with respect to the characteristics of the Company and the
effective adoption of the administrative and accounting procedures used in the preparation of the financial statements; (ii)
the compliance of the content of the financial reports with international accounting standards endorsed by the European
Union pursuant to Regulation 1606/2002/EC; (iii) the correspondence of the financial statements with the information in
the books and other accounting records and their ability to provide a true and fair representation of the performance and
financial position of the Company; and (iv) that the report on operations accompanying the financial statements contains
381
ReportsAnnual Report 2015 a reliable analysis of operations and performance, as well as the situation of the issuer, together with a description of the
main risks and uncertainties to which it is exposed. The statement also affirmed that the appropriateness of the admini-
strative and accounting procedures used in the preparation of the financial statements of the Company had been verified
in an assessment of the internal control system for financial reporting (supported by the findings of the independent
monitoring performed by the Company’s Audit department) and that the assessment of the internal control system did
not identify any material issues. An analogous statement was prepared for the consolidated financial statements for 2015
of the Enel Group;
> we monitored the adequacy and effectiveness of the internal control system, primarily through periodic meetings with
the head of the Audit department of the Company and holding most of the meetings jointly with the Control and Risk
Committee as well as with the participation of the Chairman of the Board of Auditors in the other meetings of the Control
and Risk Committee and the subsequent examination of the associated documentation during those meetings. In the
light of our examination and in the absence of significant issues, the internal control and risk management system can
be considered adequate and effective. In March 2016, the Board of Directors of the Company expressed an analogous
assessment of the situation and also noted, in February 2015 and November 2015, that the main risks associated with the
strategic targets set out, respectively, in the 2015-2019 business plan and the 2016-2020 business plan were compatible
with the management of the Company in a manner consistent with those targets;
> in July 2015, the Board of Auditors received two reports of censurable facts pursuant to Article 2408 of the Italian Civil
Code from a shareholder, who alleged serious shortcomings and omissions in both the description in the 2014 Annual
Report of a dispute in which the Company is involved and in the supplementary disclosures provided on the dispute during
the Shareholders’ Meeting in response to questions submitted by the representative of the shareholder (pursuant to Arti-
cle 127-ter of the Consolidated Law on Financial Intermediation). Following appropriate enquiries, and taking due account
of the analysis of the dispute in question conducted during previous meetings of the Board of Directors and the Board
of Auditors of Enel, the latter did not find any serious management irregularities or any simple irregularities in the events
involved in the complaint and reported those conclusions to the shareholder. In September 2015, the Board of Auditors
received two additional complaints from the same shareholder charging the Board of Auditors with failing to perform its
oversight duties in examining the above complaints and essentially restating using the same arguments the complaints
involved, adding a number of circumstances drawn from the interim financial reports at June 30, 2015 of Enel and a num-
ber of its subsidiaries. Following additional enquiries, the Board of Auditors did not find any information that would alter its
original finding of no irregularities in the events addressed by the complaints. Once again, the Board of Auditors informed
the shareholder of its conclusions. Since September 2015, the Board of Auditors has not received any further reports
concerning the affair. In addition, in December 2015, the Board of Auditors received a notice requesting the termination of
a series of contracts for the supply of electricity as they were considered inappropriately executed by an Italian company
of the Enel Group with a number of squatters. The Board of Auditors asked the competent Company units to conduct an
appropriate investigation, which found no irregularities to report;
> we monitored the effective implementation of the Corporate Governance Code, which the Company has adopted, ve-
rifying the compliance of Enel’s governance arrangements with the recommendations of the Code. Detailed information
on the Company’s corporate governance system can be found in the Report on Corporate Governance and Ownership
Structure for 2015. In June 2015 and February 2016, the Board of Auditors verified that the Board of Directors, in evalua-
ting the independence of non-executive directors, correctly applied the assessment criteria specified in the Corporate
Governance Code and the principle of the priority of substance over form set out in that Code, adopting a transparent
procedure, the details of which are discussed in the Report on Corporate Governance and Ownership Structure for 2015.
As regards the “self-assessment” of the independence of its members, the Board of Auditors verified compliance, most
recently in February 2016, with the requirements set out in both the Consolidated Law on Financial Intermediation and
the Corporate Governance Code;
> since the listing of its shares, the Company has adopted specific rules (most recently amended in December 2012) for the
internal management and processing of confidential information, which also set out the procedures for the disclosure of
documentation and information concerning the Company and the Group, with specific regard to inside information. Those
rules (which can be consulted at www.enel.com) contain appropriate provisions directed at subsidiaries to enable Enel to
382
Annual Report 2015 comply with statutory market disclosure requirements, pursuant to Article 114, paragraph 2, of the Consolidated Law on
Financial Intermediation;
> in 2002 the Company also adopted (and has subsequently updated) a Code of Ethics (also available at www.enel.com) that
expresses the commitments and ethical responsibilities involved in the conduct of business, regulating and harmonizing
corporate conduct in accordance with standards of maximum transparency and fairness with respect to all stakeholders;
> with regard to the provisions of Legislative Decree 231 of June 8, 2001 which introduced into Italian law a system of
administrative (in fact criminal) liability for companies for certain types of offences committed by its directors, managers
or employees on behalf of or to the benefit of the company since July 2002 Enel has adopted a compliance program
consisting of a “general part” and various “special parts” concerning the difference offences specified by Legislative
Decree 231/2001 that the program is intended to prevent. For a description of the manner in which the model has been
implemented by the various Group companies, please see the Report on Corporate Governance and Ownership Structure
for 2015. The structure that monitors the operation and compliance with the program and is responsible for updating it
(hereinafter, “the Supervisory Body”) is a collegial body. In 2015 it was composed of two external members with expertise
on corporate organization matters, one of whom acted as chairman of the body, and the head of the Audit department,
the head of the Legal and Corporate Affairs department and the Secretary of the Board of Directors of the Company,
since they have specific professional expertise regarding the application of the compliance program and are not directly
involved in operating activities. The Board of Auditors received adequate information on the main activities carried out in
2015 by the Supervisory Body. Our examination of those activities found no facts or situations that would require mention
in this report;
> in 2015, the Board of Auditors issued the following opinions:
- a favorable opinion at the meeting of January 26, 2015 concerning the 2015 Audit Plan in accordance with the provisions
of Article 7.C.1, letter c) of the Corporate Governance Code, preliminary to the resolutions pertaining to the Board of
Directors in that regard;
- a favorable opinion at the meeting of February 11, 2015, pursuant to Article 2389, paragraph 3, of the Italian Civil Code,
concerning the supplementary instruments concerning the resolution on the remuneration and job conditions of the
Chairman of the Board of Directors and the Chief Executive Officer/General Manager during the 2014-2016 term;
- a favorable opinion at the meeting of May 7, 2015 on the findings of Reconta Ernst & Young in its report on the major is-
sues that arose in the statutory audit in 2014, in accordance with the provisions of Article 7.C.1, letter e) of the Corporate
Governance Code, preliminary to the assessments pertaining to the Board of Directors in that regard;
> a report on the fixed and variable compensation accrued by those who served as Chairman of the Board of Directors, the
Chief Executive Officer/General Manager and other directors in 2015 for their respective positions and any compensation
instruments awarded to them will be contained (as provided for in the draft version, which the Board of Auditors has seen)
in the Remuneration Report referred to in Article 123-ter of the Consolidated Law on Financial Intermediation. It will be
submitted for approval by the Board of Directors, acting on a proposal of the Nomination and Compensation Committee,
and published in compliance with the time limits established by law. The design of these compensation instruments is
in line with best practices, complying with the principle of establishing a link with appropriate financial and non-financial
performance targets and pursuing the creation of shareholder value over the medium and long term. The proposals to the
Board of Directors concerning such forms of compensation and the determination of the associated parameters were
prepared by the Nomination and Compensation Committee, which is made up of independent directors, drawing on the
findings of benchmarking analyses at the national and international level performed by an independent consulting firm. In
addition, in determining the compensation package of the new directors with special duties in the 2014-2016 term, the
resolution of the Shareholders’ Meeting of May 22, 2014 was implemented. That resolution, in application of Article 84-ter
of Decree Law 69 of June 21, 2013 (ratified with amendments with Law 98 of August 9, 2013), established that for the
election of the Board of Directors by that Shareholders’ Meeting the remuneration of directors with special duties could
not be set by the Board of Directors in an amount exceeding 75% of the total remuneration of any form, including under
an employment relationships with the Company, established during the previous term. Finally, the Report on Remunera-
tion referred to in Article 123-ter of the Consolidated Law on Financial Intermediation will contain, in compliance with the
applicable CONSOB regulations, specific disclosures on the remuneration earned in 2015 by key management personnel.
383
ReportsAnnual Report 2015 The Board of Auditors’ oversight activity in 2015 was carried out in 17 meetings and with participation in the 15 meetings of
the Board of Directors, and, through the Chairman, in the 15 meetings of the Control and Risk Committee (of which 13 joint
meetings with the Board of Auditors), in the 7 meetings of the Nomination and Compensation Committee, in the 1 meeting
of the Related Parties Committee and in the 6 meetings of the Corporate Governance Committee. The delegate of the State
Audit Court participated in the meetings of the Board of Auditors and those of the Board of Directors.
During the course of this activity and on the basis of information obtained from Reconta Ernst & Young SpA, no omissions,
censurable facts, irregularities or other significant developments were found that would require reporting to the regulatory
authorities or mention in this report.
Based on the oversight activity performed and the information exchanged with the independent auditors Reconta Ernst &
Young SpA, we recommend that you approve the Company's financial statements for the year ended December 31, 2015 in
conformity with the proposals of the Board of Directors.
Rome, April 13, 2016
The Board of Auditors
Chairman
Sergio Duca
Auditor
Lidia D’Alessio
Auditor
Gennaro Mariconda
384
Annual Report 2015 385
ReportsAnnual Report 2015 Report of the independent
audit firm on the 2015 financial
statements of Enel SpA
386
Annual Report 2015 387
ReportsAnnual Report 2015 388
Annual Report 2015 389
ReportsAnnual Report 2015 Report of the independent
audit firm on the 2015
consolidated financial statements
of the Enel Group
390
Annual Report 2015 Reports
391
Annual Report 2015 392
Annual Report 2015 393
ReportsAnnual Report 2015 Summary of the resolutions
of the Ordinary and Extraordinary
Shareholders’ Meeting
The Ordinary and Extraordinary Shareholders’ Meeting of Enel SpA held in Rome in single call on May 26, 2016 at the Enel
Conference Center at 125, Viale Regina Margherita, adopted the following resolutions during the ordinary session:
1. approved the financial statements of Enel SpA for the year ended December 31, 2015, having acknowledged the results of the
consolidated financial statements of the Enel Group for the year ended December 31, 2015, which closed with net income attri-
butable to shareholders of the Parent Company of €2,196 million;
2. resolved:
(i) to allocate Enel SpA’s net income for the year 2015, amounting to €1,010,654,499.31, as follows:
a)
to earmark for distribution to the shareholders, as dividend, €0.08 for each of the 10,166,679,946 ordinary shares in
circulation on June 20, 2016, the scheduled ex-dividend date, for an overall amount of €813,334,395.68;
b)
to earmark for the statutory reserve the part of the net income necessary to bring the amount of the aforesaid
reserve up to one-fifth of the share capital, as specified by Article 2430, paragraph 1, of the Civil Code, for an overall
amount of €152,664,430.20;
c)
to earmark for “retained earnings” the remaining part of the net income, equal to €44,655,673.43;
(ii) to earmark for the distribution to the shareholders also a part of the available reserve named “retained earnings” allocated in
the financial statements of Enel SpA (amounting as of December 31, 2015 to €5,303,025,796.26 overall), for an amount of €0.08
for each of the 10,166,679,946 ordinary shares in circulation on June 20, 2016, the scheduled ex-dividend date, for an overall
amount of €813,334,395.68;
paying, before withholding tax, if any, an overall dividend of €0.16 per ordinary share – of which €0.08 as distribution of the 2015
net income and €0.08 as partial distribution of the available reserve named “retained earnings” – as from June 22, 2016, with
the ex-dividend date of coupon no. 24 falling on June 20, 2016 and the “record date” (i.e. the date of the title to the payment of
the dividend) coinciding with June 21, 2016;
3. appointed the new Board of Statutory Auditors, which will remain in office until the approval of the 2018 financial statements, in
the persons of:
• Sergio Duca - Chairman;
• Roberto Mazzei – Regular Auditor;
• Romina Guglielmetti - Regular Auditor;
• Alfonso Tono - Alternate Auditor;
• Michela Barbiero - Alternate Auditor;
• Franco Tutino - Alternate Auditor;
confirming their yearly gross compensation at €85,000 for the Chairman and €75,000 for each of the other regular Statu-
tory Auditors, in addition to the reimbursement of properly documented travel and living expenses incurred in the perfor-
mance of their duties;
4. approved the long term incentive plan for 2016 reserved to the management of Enel SpA and/or of its subsidiaries pur-
suant to Article 2359 of the Italian Civil Code, whose features are described in the relevant information document prepa-
394
Annual Report 2015
red pursuant to Article 84-bis, paragraph 1, of the Issuers’ Regulation adopted by Consob with resolution 11971/1999, and
to grant the Board of Directors, with the faculty to sub-delegate, all powers necessary for the actual implementation of
the aforesaid plan;
5. resolved in favor of the first section of the remuneration report drawn up pursuant to Article 123-ter of Legislative Decree 58
dated February 24, 1998, and Article 84-quater of the Issuers’ Regulation adopted by Consob with resolution 11971/1999, contai-
ning the description of the policy for the remuneration of Directors, General Manager and Executives with strategic responsibi-
lities adopted by the Company for the financial year 2016, as well as the procedures used for the adoption and implementation
of such policy.
In the extraordinary session, the Shareholders’ Meeting approved an amendment of Article 14.3 of the corporate bylaws,
concerning the procedure for the appointment of the Board of Directors by slating vote, in order to allow the entire Board to
be elected by slating vote even in the event that the slate that has obtained the most votes at the Shareholders’ Meeting con-
tains a lower number of candidates than 7/10 of the directors to be elected, assigned to that slate by the corporate bylaws.
395
ReportsAnnual Report 2015 396
Annual Report 2015 Attachments
Annual Report 2015 Subsidiaries, associates
and other significant equity
investments of the Enel Group
at December 31, 2015
In compliance with CONSOB Notice DEM/6064293 of July 28, 2006
and Article 126 of CONSOB Resolution 11971 of May 14, 1999, a
list of subsidiaries and associates of Enel SpA at December 31,
2015, pursuant to Article 2359 of the Italian Civil Code, and of other
significant equity investments is provided below. Enel has full title
to all investments.
The following information is included for each company: name,
registered office, share capital, currency in which share capital is
denominated, activity, method of consolidation, Group companies
that have a stake in the company and their respective ownership
share, and the Group’s ownership share.
398
Annual Report 2015 Company name
Headquarters Country
Parent company
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Enel SpA
Rome
Italy
9,403,357,795.00
EUR
Holding company
Holding
100.00%
Subsidiaries
Cataldo Hydro Power
New York
USA
-
USD
Electricity generation
Line-by-line
Pyrites Hydro
50.00%
34.83%
Associates LP
(New York)
from renewable
resources
LLC
Hydro
50.00%
Development
Group Acquisition
LLC
Società di sviluppo,
Milan
Italy
37,419,179.00
EUR
Energy and
-
Enel Produzione
17.65% 17.65%
realizzazione e gestione
del gasdotto Algeria-
Italia via Sardegna SpA
(in breve "Galsi SpA")
infrastructure
engineering
SpA
3-101-665717 SA
San José
Costa Rica
10,000.00
CRC
Electricity generation
Line-by-line
PH Chucas SA
100.00% 42.67%
from renewable
resources
3Sun Srl
Catania
Italy
35,205,984.00
EUR
Development, design,
Line-by-line
Enel Green
100.00% 68.29%
construction and
operation of solar panel
manufacturing plants
Power SpA
Adams Solar PV Project
Johannesburg South Africa
10,000,000.00
ZAR
Electricity generation
Line-by-line
Enel Green Power
60.00% 40.97%
Two (RF) (Pty) Ltd
from renewable
resources
RSA (Pty) Ltd
Adria Link Srl
Gorizia
Italy
500,000.00
EUR
Design, construction
Equity
Enel Produzione
33.33% 33.33%
and operation of
merchant lines
SpA
Agassiz Beach LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Agatos Green Power
Rome
Italy
10,000.00
EUR
Electricity generation
Line-by-line
Enel Green
80.00% 54.63%
Trino
from renewable
resources
Power Solar
Energy Srl
Agrupación Acefhat
Barcelona
Spain
793,340.00
EUR
Design and services
-
Endesa
16.67% 11.69%
AIE
Distribución
Eléctrica SL
Aguilón 20 SA
Zaragoza
Spain
2,682,000.00
EUR
Electricity generation
Line-by-line
Enel Green
51.00% 35.20%
from renewable
resources
Power España SL
Albany Solar LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora Distributed
100.00% 68.29%
from renewable
resources
Solar LLC
Almeyda Solar SpA
Santiago
Chile
1,736,965,000.00
CLP
Electricity generation
Line-by-line
Enel Green
100.00% 68.23%
from renewable
resources
Power Chile Ltda
Almussafes Servicios
Valencia
Spain
3,010.00
EUR
Management and
Line-by-line
Enel Green
100.00% 69.01%
Energéticos SL
maintenance of power
Power España SL
plants
Alpe Adria Energia
Udine
Italy
450,000.00
EUR
Design, construction
Equity
Enel Produzione
40.50% 40.50%
SpA
and operation of
merchant lines
SpA
Altomonte FV Srl
Rome
Italy
5,100,000.00
EUR
Electricity generation
Equity
Ultor Srl
100.00% 34.14%
from renewable
resources
Alvorada Energia SA
Rio de Janeiro Brazil
17,117,415.92
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
and sale
Power Brasil
Participações
Ltda
399
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Ampla Energia e
Rio de Janeiro Brazil
129,823.00
BRL
Electricity generation,
Line-by-line
Enel Brasil SA
46.89%
55.79%
Serviços SA
transmission and
distribution
Chilectra
21.02%
Inversud SA
Chilectra SA
10.34%
Enersis SA
21.38%
Annandale Solar
Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora Distributed
100.00% 68.29%
from renewable
resources
Solar LLC
Apiacás Energia SA
Rio de Janeiro Brazil
21,216,846.33
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Power Brasil
Participações
Ltda
Aquenergy Systems
Greenville
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
LLC
(South Carolina)
from renewable
resources
Hydro Holdings
LLC
Aquilae Solar
Las Palmas de
Spain
3,008.00
EUR
Photovoltaic plants
Equity
Endesa Ingeniería
50.00% 35.05%
SL
Gran Canaria
SLU
Aragonesa de
Teruel
Spain
60,100.00
EUR
Electricity generation
Line-by-line
Endesa Red SA 100.00% 70.10%
Actividades Energéticas
SA
Asociación Nuclear
Tarragona
Spain
19,232,400.00
EUR
Management and
Joint operation
Endesa
85.41% 59.87%
Ascó-Vandellós II AIE
maintenance of power
Generación SA
plants
Astronomy & Energy
Santiago
Chile
5,000,000.00
CLP
Electricity generation
Line-by-line
Parque Eólico
100.00% 68.23%
SpA
from renewable
resources
Renaico SpA
Athonet Smartgrid Srl Bolzano
Italy
14,285.71
EUR
Research, development
Equity
Enel Italia Srl
30.00% 30.00%
and design
Atwater Solar LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora Distributed
100.00% 68.29%
from renewable
resources
Solar LLC
Aurora Distributed
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Kansas LLC 100.00% 68.29%
Solar LLC
(Delaware)
from renewable
resources
Aurora Land Holdings
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Kansas LLC 100.00% 68.29%
LLC
from renewable
resources
Autumn Hills LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
from renewable
resources
Wind LLC
Aysén Energía SA
Santiago
Chile
4,900,100.00
CLP
Electricity
Equity
Centrales
99.00%
18.54%
Hidroeléctricas de
Aysén SA
Empresa Nacional
0.51%
de Electricidad SA
Aysén Transmisión SA Santiago
Chile
22,368,000.00
CLP
Electricity generation
Equity
Empresa Nacional
0.51%
18.54%
and sale
de Electricidad SA
Barnet Hydro Company
Burlington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
10.00%
68.29%
LLC
(Vermont)
from renewable
resources
Power North
America Inc.
Beaver Falls Water
Philadelphia
USA
-
USD
Electricity generation
Line-by-line
Beaver Valley
67.50% 46.09%
Power Company
(Pennsylvania)
from renewable
resources
Holdings LLC
Sweetwater
90.00%
Hydroelectric LLC
Centrales
Hidroeléctricas de
99.00%
Aysén SA
400
Annual Report 2015 Company name
Headquarters Country
Beaver Valley Holdings
Philadelphia
USA
LLC
(Pennsylvania)
Share
capital
-
Consolidaton
%
Group %
Currency Activity
method
Held by
holding
holding
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power North
America Inc.
Beaver Valley Power
Philadelphia
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
Company LLC
(Pennsylvania)
from renewable
resources
Hydro Holdings
LLC
Black River Hydro
New York
USA
-
USD
Electricity generation
Line-by-line
Cataldo Hydro
75.00%
43.19%
Association
(New York)
from renewable
resources
Power Associates
LP
Enel Green
25.00%
Power North
America Inc.
BLP Energy Private
New Delhi
India
30,000,000.00
INR
Electricity generation
Line-by-line
Enel Green Power
68.00% 46.44%
Limited
from renewable
resources
Development BV
BLP Vayu (Project 1)
Haryana
India
7,500,000.00
INR
Electricity generation
Line-by-line
BLP Energy
100.00% 46.44%
Private Limited
from renewable
resources
Private Limited
BLP Vayu (Project 2)
Haryana
India
45,000,000.00
INR
Electricity generation
Line-by-line
BLP Energy
100.00% 46.44%
Private Limited
from renewable
resources
Private Limited
BLP Wind Project
New Delhi
India
5,000,000.00
INR
Electricity generation
Line-by-line
BLP Energy
100.00% 46.44%
(Amberi) Private
Limited
from renewable
resources
Private Limited
Boiro Energía SA
Boiro
Spain
601,010.00
EUR
Electricity generation
Equity
Enel Green
40.00% 27.61%
Boott Field LLC
Wilmington
USA
(Delaware)
Boott Hydropower
Boston
USA
LLC
(Massachusetts)
Bp Hydro Associates Boise
USA
(Idaho)
-
-
-
from renewable
resources
Power España SL
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
from renewable
resources
Hydro Holdings
LLC
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
from renewable
resources
Hydro Holdings
LLC
USD
Electricity generation
Line-by-line
Enel Green
32.00%
68.29%
from renewable
resources
Power North
America Inc.
Bp Hydro Finance
Salt Lake City
USA
-
USD
Electricity generation
Line-by-line
Partnership
(Utah)
from renewable
resources
Chi Idaho LLC
68.00%
Bp Hydro
Associates
75.92%
68.29%
Enel Green
24.08%
Power North
America Inc.
Braila Power SA
Chiscani
Romania
1,900,000.00
RON
Electricity generation
Equity
Enel Investment
29.93% 29.93%
Holding BV
Buffalo Dunes Wind
Topeka
USA
-
USD
Electricity generation
Line-by-line
EGPNA
75.00% 51.22%
Project LLC
(Kansas)
from renewable
resources
Development
Holdings LLC
Business Venture
Lombardy East South Africa
1,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Investments 1468
(Pty) Ltd
from renewable
resources
Power RSA (Pty)
Ltd
Bypass Limited LLC
Boise
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
(Idaho)
from renewable
resources
Hydro Holdings
LLC
Bypass Power
Los Angeles
USA
-
USD
Electricity generation
Line-by-line
Chi West LLC
100.00% 68.29%
Company LLC
(California)
from renewable
resources
Canastota Wind Power
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
LLC
(Delaware)
from renewable
resources
Power North
America Inc.
Caney River Wind
Topeka
USA
-
USD
Electricity generation
Line-by-line
Rocky Caney
100.00% 68.29%
Project LLC
(Kansas)
from renewable
resources
Wind LLC
401
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
Carbopego -
Abrantes
Portugal
50,000.00
EUR
Fuel supply
Abastecimientos e
Combustiveis SA
Consolidaton
method
Equity
Held by
Endesa
Generación SA
%
Group %
holding
holding
49.99%
35.05%
Endesa
0.01%
Generación
Portugal SA
Carodex (Pty) Ltd
Houghton
South Africa
116.00
ZAR
Electricity generation
Line-by-line
Enel Green
98.49% 67.26%
from renewable
resources
Power RSA (Pty)
Ltd
Castle Rock Ridge
Calgary
Canada
-
CAD
Electricity generation
Line-by-line
Enel Alberta
0.10%
68.29%
Limited Partnership
(Alberta)
from renewable
resources
Wind Inc.
Enel Green
99.90%
Power Canada
Inc.
Cefeidas Desarrollo
Puerto del
Spain
3,008.00
EUR
Photovoltaic plants
Equity
Endesa Ingeniería
50.00% 35.05%
Solar SL
Rosario
SLU
Centrais Elétricas
Goiania
Brazil
289,340,000.00
BRL
Electricity generation
Line-by-line
Enel Brasil SA
99.75% 51.03%
Cachoeira Dourada SA
and sale
Central Dock Sud SA Buenos Aires
Argentina
35,595,178,229.00
ARS
Electricity generation,
Line-by-line
Inversora Dock
69.99% 24.24%
transmission and
distribution
Sud SA
Central Eólica Canela
Santiago
Chile
12,284,740,000.00
CLP
Electricity generation
Line-by-line
Compañía
75.00% 27.96%
SA
from renewable
resources
Eléctrica Tarapacá
SA
Central Geradora
Caucaia
Brazil
151,940,000.00
BRL
Thermal generation
Line-by-line
Enel Brasil SA
100.00% 51.15%
Termelétrica Fortaleza
SA
plants
Central Hidráulica
Seville
Spain
364,210.00
EUR
Operation of hydro-
Equity
Enel Green
33.30% 22.98%
Güejar-Sierra SL
electric plants
Power España SL
Central Térmica de
Madrid
Spain
595,000.00
EUR
Operation of thermal
Equity
Endesa
33.33% 23.36%
Anllares AIE
plants
Generación SA
Central Vuelta de
Buenos Aires
Argentina
500,000.00
ARS
Electrical facilities
Equity
Endesa Costanera
1.30%
9.80%
Obligado SA
construction
SA
Central Dock
6.40%
Sud SA
Hidroeléctrica El
33.20%
Chocón SA
Centrales
Santiago
Chile
158,975,665,182.00
CLP
Design
Equity
Empresa Nacional
51.00%
18.54%
Hidroeléctricas de
Aysén SA
de Electricidad SA
Compañía
0.00%
Eléctrica Tarapacá
SA
Centrales Nucleares
Madrid
Spain
-
EUR
Management of
Equity
Endesa
23.57%
16.76%
Almaraz-Trillo AIE
nuclear plants
Generación SA
Centrum Pre Vedu a
Kalná nad
Slovakia
6,639.00
EUR
Research and
Held for sale
Slovenské
100.00% 66.00%
Nuclenor SA
0.69%
Vyskum Sro
Hronom
development on
natural sciences and
engineering
elektrárne AS
CESI - Centro
Elettrotecnico
Sperimentale Italiano
Giacinto Motta SpA
Milan
Italy
8,550,000.00
EUR
Research and testing
Equity
Enel SpA
42.70% 42.70%
services, analysis and
consulting, engineering,
design and certification
Chepei Desarollo
Las Palmas de
Spain
3,008.00
EUR
Photovoltaic plants
Equity
Endesa Ingeniería
50.00% 35.05%
Solar L
Gran Canaria
SLU
Cherokee Falls
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Hydroelectric Project
LLC
from renewable
resources
Power North
America Inc.
Chi Black River LLC Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Delaware)
from renewable
resources
Power North
America Inc.
402
Annual Report 2015 Company name
Headquarters Country
Chi Idaho LLC
Wilmington
USA
(Delaware)
Share
capital
-
Currency Activity
method
Held by
holding
holding
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Consolidaton
%
Group %
from renewable
resources
Power North
America Inc.
Chi Minnesota Wind
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
LLC
(Delaware)
from renewable
resources
Power North
America Inc.
Chi Operations Inc.
Wilmington
USA
100.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Delaware)
from renewable
resources
Power North
America Inc.
Chi Power Inc.
Wilmington
USA
100.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Delaware)
from renewable
resources
Power North
America Inc.
Chi Power Marketing
Wilmington
USA
100.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Inc.
(Delaware)
from renewable
resources
Power North
America Inc.
Chi West LLC
Wilmington
USA
100.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Delaware)
from renewable
resources
Power North
America Inc.
Chilectra Inversud SA Santiago
Chilectra SA
Santiago
Chile
Chile
569,020,000.00
36,792,868,194.00
USD
CLP
Holding company
Line-by-line
Chilectra SA
100.00% 60.07%
Holding company,
Line-by-line
Enersis SA
99.09%
60.07%
Electricity distribution
Compañía
0.00%
Eléctrica Tarapacá
SA
Endesa SA
0.00%
Chinango SAC
Lima
Peru
294,249,298.00
PEN
Electricity generation,
Line-by-line
Edegel SA
80.00% 28.42%
Chisago Solar LLC
Delaware
USA
Chisholm View Wind
Oklahoma City
USA
Project LLC
(Oklahoma)
-
-
sale and transmission
USD
Electricity generation
Line-by-line
Aurora Distributed
100.00% 68.29%
from renewable
resources
Solar LLC
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
from renewable
resources
Wind Holdings
LLC
Chladiace Veze
Bohunice
Slovakia
16,598.00
EUR
Engineering and
Held for sale
Slovenské
35.00% 23.10%
Bohunice Spol Sro
construction
elektrárne AS
Codensa SA ESP
Bogotá DC
Colombia
13,209,330,000.00
COP
Electricity distribution
Line-by-line
Chilectra SA
9.35%
29.34%
and sale
Enersis SA
39.13%
Cogeneración El Salto
Zaragoza
Spain
36,060.73
EUR
Cogeneration of
-
Enel Green
20.00% 13.80%
SL (in liquidation)
electricity and heat
Power España SL
Cogeneración Lipsa SL Barcelona
Spain
720,000.00
EUR
Cogeneration of
Equity
Enel Green
20.00% 13.80%
electricity and heat
Power España SL
Comercializadora de
Buenos Aires
Argentina
14,010,014.00
ARS
Electricity trading
Line-by-line
Enersis SA
55.00%
49.70%
Energía SA
Endesa
45.00%
Argentina SA
Compagnia Porto di
Rome
Italy
21,372,000.00
EUR
Construction of port
Equity
Enel Produzione
25.00% 25.00%
Civitavecchia SpA
infrastructure
SpA
Companhia Energética
Fortaleza
Brazil
442,950,000.00
BRL
Electricity generation,
Line-by-line
Enersis SA
15.18%
39.32%
do Ceará SA
Compañía de
Interconexión
Energética SA
transmission and
distribution
Enel Brasil SA
58.87%
Rio de Janeiro Brazil
285,050,000.00
BRL
Electricity generation,
Line-by-line
Enel Brasil SA
100.00% 51.15%
transmission and
distribution
Compañía de
Buenos Aires
Argentina
14,175,999.00
ARS
Electricity generation,
Line-by-line
Compañía de
100.00%
51.15%
Transmisión del
Mercosur SA
transmission and
distribution
Interconexión
Energética SA
Compañía Eléctrica
Santiago
Chile
331,815,034,140.00
CLP
Electricity generation,
Line-by-line
Empresa Nacional
96.21%
37.28%
Tarapacá SA
transmission and
distribution
de Electricidad SA
Enersis SA
3.78%
Compañía Energética
Lima
Peru
2,886,000.00
PEN
Hydroelectric projects Line-by-line
Generalima SA
100.00% 60.62%
Veracruz SAC
Enel
0.00%
Latinoamérica SA
403
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
Compañía Eólica
Soria
Spain
13,222,000.00
EUR
Wind plants
Tierras Altas SA
Consolidaton
%
Group %
method
Equity
Held by
holding
holding
Enel Green
35.63% 24.59%
Power España SL
Compostilla Re SA
Luxembourg
Luxembourg
12,000,000.00
EUR
Reinsurance
Held for sale
Enel Insurance
100.00% 85.05%
NV
Concert Srl
Rome
Italy
10,000.00
EUR
Product, plant and
Line-by-line
Enel Ingegneria e
49.00%
100.00%
equipment certification
Ricerca SpA
Enel Produzione
51.00%
SpA
Coneross Power
Greenville
USA
110,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Corporation Inc.
(South Carolina)
from renewable
resources
Power North
America Inc.
Consolidated Hydro
Wilmington
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
New Hampshire LLC
(Delaware)
from renewable
resources
Hydro Holdings
LLC
Consolidated Hydro
Wilmington
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
New York LLC
(Delaware)
from renewable
resources
Hydro Holdings
LLC
Consolidated Hydro
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Southeast LLC
(Delaware)
Consolidated Pumped
Wilmington
USA
Storage Inc.
(Delaware)
from renewable
resources
Power North
America Inc.
550,000.00
USD
Electricity generation
Line-by-line
Enel Green
81.82% 55.87%
from renewable
resources
Power North
America Inc.
Consorcio Eólico
Cadiz
Spain
200,000.00
EUR
Wind plants
Equity
Enel Green
50.00% 34.51%
Marino Cabo de
Trafalgar SL
Power España SL
Copenhagen Hydro
New York
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
LLC
(New York)
from renewable
resources
Hydro Holdings
LLC
Corporación Eólica de
Zaragoza
Spain
1,021,600.00
EUR
Electricity generation
Equity
Enel Green
25.00% 17.25%
Zaragoza SL
from renewable
resources
Power España SL
Crucero Oeste Cinco
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Parque Eólico
100.00% 68.23%
SpA
from renewable
resources
Renaico SpA
Crucero Oeste Cuatro
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Parque Eólico
100.00% 68.23%
SpA
from renewable
resources
Renaico SpA
Crucero Oeste Dos
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Parque Eólico
100.00% 68.23%
SpA
from renewable
resources
Renaico SpA
Crucero Oeste Tres
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Parque Eólico
100.00% 68.23%
SpA
from renewable
resources
Renaico SpA
Crucero Oeste Uno
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Parque Eólico
100.00% 68.23%
SpA
from renewable
resources
Renaico SpA
Danax Energy (Pty) Ltd Houghton
South Africa
100.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power RSA (Pty)
Ltd
De Rock’l Srl
Bucharest
Romania
5,629,000.00
RON
Electricity generation
Line-by-line
Enel Green Power
0.00%
68.29%
from renewable
resources
International BV
Enel Green Power
100.00%
Romania Srl
Depuración Destilación
Boiro
Spain
600,000.00
EUR
Electricity generation
Equity
Enel Green
40.00% 27.61%
Reciclaje SL
from renewable
resources
Power España SL
Desarollo Photosolar
Las Palmas de
Spain
3,008.00
EUR
Photovoltaic plants
Equity
Endesa Ingeniería
50.00% 35.05%
SL
Gran Canaria
SLU
404
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Desarrollo de Fuerzas
Mexico City
Mexico
13,564,350.00
MXN
Electricity generation
Line-by-line
Enel Green
99.99%
68.29%
Renovables S de RL
de Cv
from renewable
resources
Power México S
de RL de Cv
Energía Nueva
0.01%
Energía Limpia
México S de RL
de Cv
Diego de Almagro
Santiago
Chile
351,604,338.00
CLP
Electricity generation
Line-by-line
Empresa Eléctrica
100.00% 68.23%
Matriz SpA
from renewable
resources
Panguipulli SA
Dietrich Drop LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
from renewable
resources
Hydro Holdings
LLC
Diseño de Sistemas
Valencia
Spain
578,000.00
EUR
Photovoltaic plants
-
Endesa Servicios
14.39% 10.09%
en silicio SA
(in liquidation)
SL
Distribuidora de
Barcelona
Spain
108,240.00
EUR
Electricity distribution
Line-by-line
Hidroeléctrica de
45.00%
70.10%
Energía Eléctrica del
Bages SA
and sale
Catalunya SL
Endesa Red SA
55.00%
Distribuidora Eléctrica
Bogotá DC
Colombia
1,000,000.00
COP
Electricity distribution
Equity
Inversora
0.00%
14.38%
de Cundinamarca
SA ESP
and sale
Codensa Sas
Codensa SA ESP
49.00%
Distribuidora Eléctrica
Tenerife
Spain
12,621,210.00
EUR
Electricity purchase,
Line-by-line
Endesa Red SA 100.00% 70.10%
del Puerto de La Cruz
SA
transmission and
distribution
Distrilec Inversora
Buenos Aires
Argentina
497,610,000.00
ARS
Holding company
Line-by-line
Empresa Nacional
0.89%
30.87%
SA
de Electricidad SA
Chilectra SA
23.42%
Enersis SA
27.19%
Dodge Center
Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora Distributed
100.00% 68.29%
Distributed Solar
LLC
from renewable
resources
Solar LLC
Dominica Energía
Colonia
Mexico
279,282,225.00
MXN
Electricity generation
Line-by-line
Enel Green
0.04%
68.29%
Limpia S de RL de Cv
Guadalupe Inn
from renewable
resources
Power Guatemala
SA
Enel Green
99.96%
Power México S
de RL de Cv
Drift Sand Wind Project
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Kansas LLC 100.00% 68.29%
LLC
from renewable
resources
Eastwood Solar LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora Distributed
100.00% 68.29%
from renewable
resources
Solar LLC
Edegel SA
Lima
Peru
2,302,143,514.88
PEN
Electricity generation,
Line-by-line
Generandes Perú
54.20%
35.53%
distribution and sale
SA
Empresa Nacional
29.40%
de Electricidad SA
EGP BioEnergy Srl
Rome
Italy
1,000,000.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power Puglia Srl
EGP Geronimo Holding
Wilmington
USA
1,000.00
USD
Holding company
Line-by-line
Enel Green
100.00% 68.29%
Company Inc.
(Delaware)
Power North
America Inc.
EGP Salt Wells Solar
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
LLC
from renewable
resources
Power North
America Inc.
EGP Solar 1 LLC
Wilmington
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP Solar
100.00% 34.83%
(Delaware)
from renewable
resources
Holdings LLC
405
AttachmentsAnnual Report 2015 Company name
Headquarters Country
EGP Stillwater Solar
Wilmington
USA
LLC
(Delaware)
Share
capital
-
Currency Activity
method
Held by
holding
holding
USD
Electricity generation
Line-by-line
Enel Stillwater
100.00% 34.83%
Consolidaton
%
Group %
from renewable
resources
LLC
EGP Stillwater Solar
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
PV II LLC
from renewable
resources
Power North
America Inc.
EGP Timber Hills
Los Angeles
USA
-
USD
Electricity generation
Line-by-line
Padoma Wind
100.00% 68.29%
Project LLC
(California)
from renewable
resources
Power LLC
EGP NA Development
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green Power
100.00% 68.29%
Holdings LLC
(Delaware)
from renewable
resources
North America
Development LLC
EGP NA Hydro
Delaware
USA
-
USD
Holding company
Line-by-line
Enel Green
100.00% 68.29%
Holdings LLC
EGP NA Renewable
Delaware
USA
Energy Partners LLC
EGP NA REP Holdings
Delaware
USA
-
-
LLC
Power North
America Inc.
USD
Holding company
Line-by-line
EGPNA REP
51.00% 34.83%
Holdings LLC
USD
Holding company
Line-by-line
Enel Green
100.00% 68.29%
Power North
America Inc.
EGP NA REP Hydro
Delaware
USA
-
USD
Holding company
Line-by-line
EGPNA
100.00% 34.83%
Holdings LLC
Renewable
Energy Partners
LLC
EGP NA REP Solar
Delaware
USA
-
USD
Holding company
Line-by-line
EGPNA
100.00% 34.83%
Holdings LLC
Renewable
Energy Partners
LLC
EGP NA REP Wind
Delaware
USA
-
USD
Electricity generation
Line-by-line
EGPNA
100.00% 34.83%
Holdings LLC
from renewable
resources
Renewable
Energy Partners
LLC
EGP NA Wind Holdings
Wilmington
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
1 LLC
(Delaware)
from renewable
resources
Wind Holdings
LLC
El Dorado Hydro LLC Los Angeles
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
(California)
from renewable
resources
Hydro Holdings
LLC
Elcogas SA
Puertollano
Spain
809,690.40
EUR
Electricity generation
Equity
Enel SpA
4.32%
33.05%
Endesa
40.99%
Generación SA
Elcomex Solar Energy
Costanza
Romania
4,590,000.00
RON
Electricity generation
Line-by-line
Enel Green Power
0.00%
68.29%
Srl
from renewable
resources
International BV
Enel Green Power
100.00%
Romania Srl
Elecgas SA
Santarem
Portugal
50,000.00
EUR
Combined-cycle
Equity
Endesa
50.00% 35.05%
(Pego)
electricity generation
Generación
Portugal SA
Electra Capital (RF)
Johannesburg South Africa
10,000,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
60.00% 40.97%
(Pty) Ltd
from renewable
resources
Power RSA (Pty)
Ltd
Eléctrica Cabo Blanco
Lima
Peru
46,508,170.00
PEN
Holding company
Line-by-line
Enersis SA
80.00%
60.62%
SA
Generalima SA
20.00%
Eléctrica de Jafre SA Girona
Spain
165,880.00
EUR
Electricity distribution
Equity
Hidroeléctrica de
47.46% 33.27%
and sale
Catalunya SL
Eléctrica de Lijar SL
Cadiz
Spain
1,081,820.00
EUR
Electricity transmission
Equity
Endesa Red SA 50.00% 35.05%
and distribution
Electricidad de Puerto
Cadiz
Spain
6,611,130.00
EUR
Distribution and supply
Equity
Endesa Red SA 50.00% 35.05%
Real SA
of electricity
Electrogas SA
Santiago
Chile
61,832,327.00
USD
Holding company
Equity
Empresa Nacional
42.50% 15.45%
de Electricidad SA
406
Annual Report 2015 Company name
Headquarters Country
Elk Creek Hydro LLC Delaware
USA
Share
capital
-
Currency Activity
method
Held by
holding
holding
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Consolidaton
%
Group %
from renewable
resources
Power North
America Inc.
Emgesa Panama SA
Panama
Panama
10,000.00
USD
Electricity trading
Line-by-line
Emgesa SA ESP 100.00% 22.87%
Emgesa SA ESP
Bogotá DC
Colombia
655,222,310,000.00
COP
Electricity generation
Line-by-line
Enersis SA
21.61%
22.87%
and sale
Empresa Nacional
26.87%
de Electricidad SA
Emittenti Titoli SpA
Milan
Empresa Carbonífera
Madrid
Italy
Spain
5,200,000.00
18,030,000.00
EUR
EUR
-
Mining
-
Enel SpA
10.00% 10.00%
Line-by-line
Endesa
100.00% 70.10%
del Sur SA
Generación SA
Empresa de
Lima
Peru
638,560,000.00
PEN
Electricity distribution
Line-by-line
Inversiones
51.68%
45.79%
Distribución Eléctrica
de Lima Norte SAA
and sale
Distrilima SA
Enersis SA
24.00%
Empresa de Energía
Bogotá DC
Colombia
39,699,630,000.00
COP
Electricity distribution
Equity
Distribuidora
82.34% 11.84%
Cundinamarca SA ESP
and sale
Eléctrica de
Cundinamarca
SA ESP
Empresa Distribuidora
Buenos Aires
Argentina
898,590,000.00
ARS
Electricity distribution
Line-by-line
Distrilec Inversora
56.36%
43.41%
Sur SA
and sale
SA
Chilectra SA
20.85%
Enersis SA
22.25%
Empresa Eléctrica de
Santiago
Chile
82,222,000.00
CLP
Electricity generation,
Line-by-line
Luz Andes Ltda
0.00%
60.07%
Colina Ltda
transmission and
distribution
Chilectra SA
100.00%
Empresa Eléctrica de
Lima
Peru
73,982,594.00
PEN
Electricity generation
Line-by-line
Eléctrica Cabo
60.00%
58.50%
Piura SA
Blanco SA
Generalima SA
36.50%
Empresa Eléctrica
Santiago
Chile
48,038,937.00
CLP
Electricity generation
Line-by-line
Enel Green
99.99%
68.23%
Panguipulli SA
from renewable
resources
Power Chile Ltda
Enel Green
0.01%
Power Latin
America Ltda
Empresa Eléctrica
Santiago
Chile
200,319,020.73
CLP
Electricity generation,
Line-by-line
Empresa Nacional
92.65% 33.69%
Pehuenche SA
transmission and
distribution
de Electricidad SA
Empresa Nacional de
Santiago
Chile
1,331,714,090,000.00
CLP
Electricity generation,
Line-by-line
Enersis SA
59.98% 36.36%
Electricidad SA
transmission and
distribution
Empresa Nacional de
Santiago
Chile
12,647,752,517.00
CLP
Electricity generation
Line-by-line
Enel Green
51.00% 34.80%
Geotermia SA
from renewable
resources
Power Chile Ltda
Empresa Propietaria
Panama
Panama
58,500,000.00
USD
Electricity transmission
-
Enel
11.11% 70.14%
de La Red SA
and distribution
Latinoamérica SA
En-Brasil Comercio e
Rio de Janeiro Brazil
1,000,000.00
BRL
Electricity
Line-by-line
Enel Brasil SA
99.99%
51.15%
Serviços SA
Central Geradora
0.01%
Termelétrica
Fortaleza SA
Endesa Argentina SA Buenos Aires
Argentina
514,530,000.00
ARS
Holding company
Line-by-line
Empresa Nacional
99.66%
36.36%
de Electricidad SA
Compañía
0.34%
Eléctrica Tarapacá
SA
Endesa Capital SA
Madrid
Spain
60,200.00
EUR
Finance company
Line-by-line
Endesa SA
100.00% 70.10%
Endesa
Oporto
Portugal
250,000.00
EUR
Electricity generation
Line-by-line
Endesa Energía
100.00% 70.10%
Comercialização de
Energia SA
and sale
SA
407
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Endesa Costanera SA Buenos Aires
Argentina
701,988,378.00
ARS
Electricity generation
Line-by-line
Endesa Argentina
49.68%
27.52%
and sale
SA
Empresa Nacional
24.85%
de Electricidad SA
Southern Cone
1.15%
Power Argentina
SA
Endesa Distribución
Barcelona
Spain
1,204,540,060.00
EUR
Electricity distribution Line-by-line
Endesa Red SA 100.00% 70.10%
Eléctrica SL
Endesa Energía SA
Madrid
Spain
12,981,860.00
EUR
Marketing of energy
Line-by-line
Endesa SA
100.00% 70.10%
products
Endesa Energía XXI SL Madrid
Spain
2,000,000.00
EUR
Marketing and energy-
Line-by-line
Endesa Energía
100.00% 70.10%
related services
SA
Endesa Financiación
Madrid
Spain
4,621,003,006.00
EUR
Finance company
Line-by-line
Endesa SA
100.00% 70.10%
Filiales SA
Endesa Generación
Seville
Spain
63,107.00
EUR
Electricity generation
Line-by-line
Endesa SA
100.00% 70.10%
II SA
Endesa Generación
Seville
Spain
60,000.00
EUR
Subholding company in
Line-by-line
Endesa
100.00% 70.10%
Nuclear
the nuclear sector
Generación SA
Endesa Generación
Paço de Arcos
Portugal
50,000.00
EUR
Electricity generation
Line-by-line
Endesa
99.20%
70.09%
Portugal SA
(Oeiras)
Generación SA
Endesa Energía
0.20%
SA
Enel Green
0.40%
Power España SL
Energías de
0.20%
Aragón II SL
Endesa Generación SA Seville
Spain
1,940,379,737.02
EUR
Electricity generation
Line-by-line
Endesa SA
100.00% 70.10%
and sale
Endesa Ingeniería SLU Seville
Spain
1,000,000.00
EUR
Consulting and
Line-by-line
Endesa Red SA
100.00% 70.10%
engineering services
Endesa Operaciones y
Barcelona
Spain
10,138,580.00
EUR
Services
Line-by-line
Endesa Energía
100.00% 70.10%
Servicios Comerciales
SL
Endesa Power Trading
London
Ltd
Endesa Red SA
Barcelona
Endesa SA
Madrid
United
Kingdom
Spain
Spain
SA
2.00
GBP
Trading
Line-by-line
Endesa SA
100.00% 70.10%
719,901,728.28
EUR
Electricity distribution Line-by-line
Endesa SA
100.00% 70.10%
1,270,502,540.40
EUR
Holding company
Line-by-line
Enel Iberoamérica
Srl
70.10% 70.10%
Endesa Servicios SL Madrid
Spain
89,999,790.00
EUR
Services
Line-by-line
Endesa SA
100.00% 70.10%
Enel Alberta Wind Inc. Calgary
Canada
16,251,021.00
CAD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Alberta)
from renewable
resources
Power Canada
Inc.
Enel Atlantic Canada
Newfoundland Canada
-
CAD
Electricity generation
Line-by-line
Enel Green
99.90%
68.29%
Limited Partnership
from renewable
resources
Power Canada
Inc.
Newind Group
0.10%
Inc.
408
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Enel Brasil SA
Rio de Janeiro Brazil
1,320,049,091.42
BRL
Holding company
Line-by-line
Edegel SA
4.00%
51.15%
Chilectra
5.94%
Inversud SA
Chilectra SA
5.33%
Empresa
34.64%
Nacional de
Electricidad SA
Enersis SA
50.09%
Enel Cove Fort II LLC Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Delaware)
from renewable
resources
Power North
America Inc.
Enel Cove Fort LLC Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Geothermal
100.00% 34.83%
(Delaware)
from renewable
resources
LLC
Enel Distributie Banat
Timisoara
Romania
382,158,580.00
RON
Electricity distribution Line-by-line
Enel Investment
51.00% 51.00%
SA
Holding BV
Enel Distributie
Costanza
Romania
280,285,560.00
RON
Electricity distribution Line-by-line
Enel Investment
51.00% 51.00%
Dobrogea SA
Holding BV
Enel Distributie
Bucharest
Romania
271,635,250.00
RON
Electricity distribution Line-by-line
Enel Investment
64.43% 64.43%
Muntenia SA
Enel Distribuzione SpA Rome
Enel Energia SpA
Rome
Italy
Italy
2,600,000,000.00
302,039.00
EUR
EUR
Electricity distribution Line-by-line
Electricity and gas salesLine-by-line
Holding BV
Enel SpA
Enel SpA
100.00% 100.00%
100.00% 100.00%
Enel Energie Muntenia
Bucharest
Romania
37,004,350.00
RON
Electricity sale
Line-by-line
Enel Investment
64.43% 64.43%
SA
Holding BV
Enel Energie SA
Bucharest
Romania
140,000,000.00
RON
Electricity sale
Line-by-line
Enel Investment
51.00% 51.00%
Holding BV
Enel Energy South
Gauteng
South Africa
1,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Africa
from renewable
resources
Power
International BV
Enel Finance
Amsterdam
The
1,478,810,370.00
EUR
Holding company
Line-by-line
Enel SpA
100.00% 100.00%
International NV
Netherlands
Enel Fortuna SA
Panama
Panama
100,000,000.00
USD
Electricity generation
Line-by-line
Enel Green
50.06% 34.18%
from renewable
resources
Power Panama
SA
Enel France Sas
Paris
France
34,937,000.00
EUR
Holding company
Line-by-line
Enel Investment
100.00% 100.00%
Holding BV
Enel Gas Rus LLC
Moscow
Russian
350,000.00
RUB
Energy services
Line-by-line
Enel Investment
100.00% 100.00%
Federation
Holding BV
Enel Geothermal LLC Wilmington
USA
-
USD
Electricity generation
Line-by-line
EGPNA
100.00% 34.83%
(Delaware)
from renewable
resources
Renewable
Energy Partners
LLC
Enel GP Newfoundland
Newfoundland Canada
1,000.00
CAD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
and Labrador Inc.
from renewable
resources
Wind Holdings
LLC
Enel Green Power Boa
Niterói (Rio de
Brazil
1,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.00%
68.29%
Vista Eólica SA
Janeiro)
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green
1.00%
Power
Desenvolvimento
Ltda
Enel Green Power
Rio de Janeiro Brazil
-
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Bom Jesus da Lapa
Solar SA
from renewable
resources
Power Brasil
Participações
Ltda
409
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Enel Green Power
Rio de Janeiro Brazil
2,131,724,676.70
BRL
Holding company
Line-by-line
Enel Green
99.99%
68.29%
Brasil Participações
Ltda
Power
International BV
Enel Green
0.01%
Power Latin
America Ltda
Enel Green Power
Sofia
Bulgaria
35,231,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
Bulgaria EAD
operation and
maintenance
Power
International BV
Enel Green Power
Rio de Janeiro Brazil
76,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Cabeça de Boi SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power CAI
Rome
Italy
100,000.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Agroenergy Srl
from renewable
resources
Power SpA
Enel Green Power
Rome
Italy
10,000.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Calabria Srl
from renewable
resources
Power SpA
Enel Green Power
Montreal
Canada
85,681,857.00
CAD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Canada Inc.
(Quebec)
from renewable
resources
Power North
America Inc.
Enel Green Power
Santiago
Chile
15,649,360,000.00
CLP
Electricity generation
Line-by-line
Enel Green
99.99%
68.23%
Chile Ltda
from renewable
resources
Power Latin
America Ltda
Enel Green Power
Bogotá DC
Colombia
300,000,000.00
COP
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Colombia SA
from renewable
resources
Power
International BV
Enel Green Power
San José
Costa Rica
27,500,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Costa Rica SA
from renewable
resources
Power
International BV
Enel Green Power
Rio de Janeiro Brazil
144,640,892.85
BRL
Electricity generation
Line-by-line
Enel Green
99.00%
68.29%
Hydromac
Energy BV
0.01%
Cristal Eólica SA
and sale from
renewable resources
Power Brasil
Participações
Ltda
Enel Green
1.00%
Power
Desenvolvimento
Ltda
Enel Green Power
Rio de Janeiro Brazil
1,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Critalândia I Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
1,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Critalândia II Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
70,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.00%
68.29%
Damascena Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green
1.00%
Power
Desenvolvimento
Ltda
Enel Green Power
Rio de Janeiro Brazil
70,379,344.85
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Delfina A Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
23,054,973.26
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Delfina B Eólica SA
410
from renewable
resources
Power Brasil
Participações
Ltda
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Enel Green Power
Rio de Janeiro Brazil
7,298,322.77
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Delfina C Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
24,624,368.53
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Delfina D Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
24,623,467.93
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Delfina E Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
13,900,297.00
BRL
Electricity generation
Line-by-line
Enel Green
0.01%
68.29%
Desenvolvimento Ltda
from renewable
resources
Power Latin
America Ltda
Enel Green
99.99%
Power Brasil
Participações
Ltda
Enel Green Power
Amsterdam
The
20,000.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Development BV
Netherlands
from renewable
resources
Power
International BV
Enel Green Power
Rio de Janeiro Brazil
135,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Dois Riachos
Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Quito
Ecuador
26,000.00
USD
Electricity generation
Line-by-line
Enel Green
1.00%
68.29%
Ecuador SA
from renewable
resources
Power Latin
America Ltda
Enel Green Power
Cairo
Egypt
250,000.00
EGP
Management,
Line-by-line
Enel Green
100.00% 68.29%
Egypt SAE
operation and
maintenance of energy
production plant of
all types and their
distribution networks
Power
International BV
Enel Green Power El
San Salvador
El Salvador
3,071,090.00
SVC
Electricity generation
Line-by-line
Enel Green
0.00%
67.61%
Enel Green
99.00%
Power
International BV
Salvador SA de Cv
from renewable
resources
Power
Latin America
Ltda
Enel Green
99.00%
Power
International BV
Enel Green Power
Rio de Janeiro Brazil
177,500,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.00%
68.29%
Emiliana Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green
1.00%
Power
Desenvolvimento
Ltda
Enel Green Power
Madrid
Spain
11,152.74
EUR
Electricity generation
Line-by-line
Endesa
40.00%
69.01%
España SL
from renewable
resources
Generación SA
Enel Green
60.00%
Power
International BV
411
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Enel Green Power
Rio de Janeiro Brazil
135,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.00%
68.29%
Esperança Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green
1.00%
Power
Desenvolvimento
Ltda
Enel Green Power
Rio de Janeiro Brazil
62,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Fazenda SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rome
Italy
10,000,000.00
EUR
Electricity generation
Line-by-line
Enel Green
70.00% 47.80%
Finale Emilia Srl
from renewable
resources
Power SpA
Enel Green Power
Tenerife
Spain
3,012.00
EUR
Electricity generation
Line-by-line
Enel Green
65.00% 44.86%
Granadilla SL
from renewable
resources
Power España SL
Enel Green Power
Guatemala
Guatemala
5,000.00
GTQ
Holding company
Line-by-line
Enel Green
2.00%
68.29%
Guatemala SA
Power Latin
America Ltda
Enel Green
98.00%
Power
International BV
Enel Green Power
Maroussi
Greece
7,737,850.00
EUR
Holding company.
Line-by-line
Enel Green
100.00% 68.29%
Hellas SA
Energy services
Power
International BV
Enel Green Power
Rio de Janeiro Brazil
-
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Horizonte MP Solar SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Amsterdam
The
244,532,298.00
EUR
Holding company
Line-by-line
Enel Green
100.00% 68.29%
International BV
Netherlands
Power SpA
Enel Green Power
Rio de Janeiro Brazil
1,639,346.69
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Ituverava Norte Solar
SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
1,639,346.69
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Ituverava Solar SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
1,639,346.69
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Ituverava Sul Solar SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
165,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
1.00%
68.29%
Joana Eólica SA
from renewable
resources
Power
Desenvolvimento
Ltda
Enel Green
99.00%
Power Brasil
Participações
Ltda
Enel Green Power
Nairobi
Kenya
100,000.00
KES
Electricity generation,
Line-by-line
Enel Green
99.00%
68.29%
Kenya Limited
transmission,
distribution sale and
purchase
Enel Green Power
Santiago
Chile
30,728,470.00
CLP
Holding company
Line-by-line
Latin America Ltda
Power
International BV
Enel Green
1.00%
Power RSA (Pty)
Ltd
Hydromac
Energy BV
99.90%
68.23%
Enel Green
0.01%
Power
International BV
412
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Enel Green Power
Rio de Janeiro Brazil
70,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.00%
68.29%
Maniçoba Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green
1.00%
Power
Desenvolvimento
Ltda
Enel Green Power
Mexico City
Mexico
2,399,774,165.00
MXN
Holding company
Line-by-line
Enel Green
0.01%
68.29%
México S de RL de Cv
Power Latin
America Ltda
Enel Green
99.99%
Power
International BV
Enel Green Power
Rio de Janeiro Brazil
175,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.00%
68.12%
Modelo I Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Brasil SA
1.00%
Enel Green Power
Rio de Janeiro Brazil
150,000,000.00
BRL
Electricity generation
Line-by-line
Enel Brasil SA
1.00%
68.12%
Modelo II Eólica SA
from renewable
resources
Enel Green
99.00%
Power Brasil
Participações
Ltda
Enel Green Power
Niterói
Brazil
1,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.00% 67.61%
Morro do Chapéu I
(Rio de Janeiro)
Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Niterói
Brazil
1,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.00% 67.61%
Morro do Chapéu II
(Rio de Janeiro)
Eólica SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
8,513,128.89
BRL
Electricity generation
Line-by-line
Enel Green
99.90% 68.22%
Mourão SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Windhoek
Namibia
100.00
NAD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Namibia (Pty) Ltd
from renewable
resources
Power
International BV
Enel Green Power
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
North America
(Delaware)
Development LLC
from renewable
resources
Power
International BV
Enel Green Power
Wilmington
USA
50.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
North America Inc.
(Delaware)
from renewable
resources
Power
International BV
Enel Green Power
Rio de Janeiro Brazil
-
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Nova Lapa Solar SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
-
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Nova Olinda B
Solar SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
-
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Nova Olinda C
Solar SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
-
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Nova Olinda Norte
Solar SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
-
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Nova Olinda Sul Solar
SA
from renewable
resources
Power Brasil
Participações
Ltda
413
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Enel Green Power
Panama
Panama
3,000.00
USD
Holding company
Line-by-line
Enel Green
100.00% 68.29%
Panama SA
Power
International BV
Enel Green Power
Rio de Janeiro Brazil
1,000.00
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Paranapanema SA
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power
Rome
Italy
10,000.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Partecipazioni Speciali
Srl
from renewable
resources
Power SpA
Enel Green Power Pau
Rio de Janeiro Brazil
178,670,000.00
BRL
Electricity generation
Line-by-line
Enel Green
1.00%
68.28%
Ferro Eólica SA
from renewable
resources
Power
Desenvolvimento
Ltda
Enel Green
99.00%
Power Brasil
Participações
Ltda
Enel Green Power
Rio de Janeiro Brazil
230,000,000.00
BRL
Electricity generation
Enel Green Power
Enel Green
1.00%
68.28%
Pedra do Gerônimo
Eólica SA
from renewable
Desenvolvimento
Power
resources
Ltda
Desenvolvimento
Ltda
Enel Green
99.00%
Power Brasil
Participações
Ltda
Enel Green Power
Lima
Peru
1,000.00
PEN
Electricity generation
Line-by-line
Empresa Eléctrica
0.01%
68.23%
Peru SA
from renewable
resources
Panguipulli SA
Enel Green
99.90%
Power
International BV
Enel Green Power
Rio de Janeiro Brazil
144,640,892.85
BRL
Electricity generation
Line-by-line
Enel Green
1.00%
68.29%
Primavera Eólica SA
and sale from
renewable resources
Power
Desenvolvimento
Ltda
Enel Green
99.00%
Power Brasil
Participações
Ltda
Enel Green Power
Rome
Italy
1,000,000.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Puglia Srl
from renewable
resources
Power SpA
Enel Green Power RA
Cairo
Egypt
15,000,000.00
EGP
Management,
Line-by-line
Enel Green
100.00% 68.29%
SAE
operation and
maintenance of energy
production plant of
all types and their
distribution networks
Power Egypt SAE
Enel Green Power
Rusu de Sus
Romania
2,430,631,000.00
RON
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Romania Srl
(Nus¸eni)
from renewable
resources
Power
International BV
Enel Green Power RSA
Johannesburg South Africa
1,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Pty) Ltd
from renewable
resources
Power
Development BV
Enel Green Power RSA
Johannesburg South Africa
120.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
2 (Pty) Ltd
from renewable
resources
Power RSA (Pty)
Ltd
414
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Enel Green Power
Niterói (Rio de
Brazil
14,412,120.00
BRL
Electricity generation
Line-by-line
Enel Green
1.00%
68.29%
Salto Apiacás SA
Janeiro)
from renewable
resources
Power
Desenvolvimento
Ltda
Enel Green
99.00%
Power Brasil
Participações
Ltda
Enel Green Power San
Rome
Italy
10,000.00
EUR
Electricity generation
Equity
Altomonte FV Srl 80.00% 27.32%
Gillio Srl
from renewable
resources
Enel Green Power São
Niterói (Rio de
Brazil
1,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
99.00% 67.61%
Abraão Eólica SA
Janeiro)
from renewable
resources
Power Brasil
Participações
Ltda
Enel Green Power São
Rio de Janeiro Brazil
144,640,892.85
BRL
Electricity generation
Line-by-line
Enel Green
99.00%
68.29%
Judas Eólica SA
and sale from
renewable sources
Power Brasil
Participações
Ltda
Enel Green
1.00%
Power
Desenvolvimento
Ltda
Enel Green Power
Cairo
Egypt
15,000,000.00
EGP
Management,
Line-by-line
Enel Green
100.00% 68.29%
SHU SAE
operation and
maintenance of energy
production plant of
all types and their
distribution networks
Power Egypt SAE
Enel Green Power
Rome
Italy
10,000.00
EUR
Design, development,
Line-by-line
Enel Green
100.00% 68.29%
Solar Energy Srl
construction
and operation of
photovoltaic plants
(holding company)
Power SpA
Enel Green Power SpA Rome
Italy
1,000,000,000.00
EUR
Electricity generation
Line-by-line
Enel SpA
68.29% 68.29%
from renewable
resources
Enel Green Power
Turin
Italy
250,000.00
EUR
Electricity generation
Equity
Altomonte
60.00% 20.49%
Strambino Solar Srl
from renewable
resources
FV Srl
Enel Green Power
Rio de Janeiro Brazil
125,765,000.00
BRL
Electricity generation
Line-by-line
Enel Green
1.00%
68.28%
Tacaicó Eólica SA
from renewable
resources
Power
Desenvolvimento
Ltda
Enel Green
99.00%
Power Brasil
Participações
Ltda
Enel Green Power
Cairo
Egypt
15,000,000.00
EGP
Management,
Line-by-line
Enel Green
100.00% 68.29%
Tefnut SAE
operation and
maintenance of energy
production plant of
all types and their
distribution networks
Power Egypt SAE
Enel Green Power
Istanbul
Turkey
61,654,658.00
TRY
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Turkey Enerji Yatirimlari
Anonim S‚irketi
from renewable
resources
Power
International BV
Enel Green Power
Oficina 1508
Uruguay
400,000.00
UYU
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Uruguay SA
from renewable
resources
Power
International BV
Enel Green Power
Rome
Italy
1,200,000.00
EUR
Electricity generation
Line-by-line
Enel Green
51.00% 34.83%
Villoresi Srl
from renewable
resources
Power SpA
Enel Iberoamérica Srl Madrid
Spain
500,000,000.00
EUR
Holding company
Line-by-line
Enel SpA
100.00% 100.00%
415
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
Consolidaton
method
Enel Ingegneria e
Rome
Italy
30,000,000.00
EUR
Analysis, design,
Line-by-line
Held by
Enel SpA
%
Group %
holding
holding
100.00% 100.00%
Ricerca SpA
construction and
maintenance of
engineering works
Enel Insurance NV
Amsterdam
The
60,000.00
EUR
Holding company
Line-by-line
Endesa SA
50.00%
85.05%
Netherlands
Enel Investment
50.00%
Holding BV
Enel Investment
Amsterdam
The
1,593,050,000.00
EUR
Holding company
Line-by-line
Enel SpA
100.00% 100.00%
Holding BV
Netherlands
Enel Italia Srl
Rome
Italy
50,000,000.00
EUR
Personnel
Line-by-line
Enel SpA
100.00% 100.00%
administration
activities, information
technology and
business services
Enel Kansas LLC
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Delaware)
from renewable
resources
Power North
America Inc.
Enel Latinoamérica SA Madrid
Spain
796,683,058.00
EUR
Holding company
Line-by-line
Enel Iberoamérica
100.00% 100.00%
Srl
Enel Longanesi
Rome
Italy
10,000,000.00
EUR
Prospecting and
Line-by-line
Enel Trade SpA 100.00% 100.00%
Developments Srl
development of
hydrocarbon fields
Enel M@P Srl
Rome
Italy
100,000.00
EUR
Metering, remote
Line-by-line
Enel Distribuzione
100.00% 100.00%
control and connectivity
services via power line
communication
SpA
Enel Minnesota
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
EGP Geronimo
100.00% 68.29%
Holdings LLC
(Minnesota)
from renewable
resources
Holding Company
Inc.
Enel Nevkan Inc.
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Delaware)
from renewable
resources
Power North
America Inc.
Enel Oil & Gas España
Madrid
Spain
33,000.00
EUR
Prospecting and
Line-by-line
Enel Oil & Gas
100.00% 100.00%
SL
development of
hydrocarbon fields
SpA
Enel Oil & Gas SpA
Rome
Italy
200,000,000.00
EUR
Upstream gas-
Line-by-line
Enel Trade SpA 100.00% 100.00%
extraction of natural
gas
Enel Open Fiber SpA Milan
Italy
5,000,000.00
EUR
Installation of electronic
Line-by-line
Enel SpA
100.00% 100.00%
plant (including
maintenance and
repair)
Enel Productie Srl
Bucharest
Romania
20,210,200.00
RON
Electricity generation
Line-by-line
Enel Investment
100.00% 100.00%
Holding BV
Enel Produzione SpA Rome
Italy
1,800,000,000.00
EUR
Electricity generation
Line-by-line
Enel SpA
100.00% 100.00%
Enel Romania Srl
Judetul Ilfov
Romania
200,000.00
RON
Business services
Line-by-line
Enel Investment
100.00% 100.00%
Holding BV
Enel Russia PJSC
Ekaterinburg
Russian
35,371,898,370.00
RUB
Electricity generation
Line-by-line
Enel Investment
56.43% 56.43%
Federation
Holding BV
Enel Salt Wells LLC Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Delaware)
from renewable
resources
Power North
America Inc.
Enel Servicii Comune
Bucharest
Romania
33,000,000.00
RON
Energy services
Line-by-line
Enel Distributie
50.00%
51.00%
SA
Banat SA
Enel Distributie
50.00%
Dobrogea SA
Enel Servizio Elettrico
Rome
SpA
Enel Sole Srl
Rome
Italy
Italy
10,000,000.00
EUR
Electricity sale
Line-by-line
Enel SpA
100.00% 100.00%
4,600,000.00
EUR
Public lighting systems Line-by-line
Enel SpA
100.00% 100.00%
416
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Enel Soluções
Niterói
Brazil
5,000,000.00
BRL
Electricity generation
Line-by-line
Enel Green
0.01%
68.29%
Energéticas Ltda
(Rio de Janeiro)
from renewable
resources
Power
Desenvolvimento
Ltda
Enel Green
99.99%
Power Brasil
Participações
Ltda
Enel Stillwater LLC
Wilmington
USA
(Delaware)
Enel Surprise Valley
Wilmington
USA
LLC
(Delaware)
Enel Texkan Inc.
Wilmington
USA
(Delaware)
-
-
-
Enel Trade d.o.o.
Zagabria
Croatia
2,240,000.00
Enel Trade Romania Srl Bucharest
Romania
21,250,000.00
Enel Trade Serbia d.o.o.Belgrade
Enel Trade SpA
Rome
Serbia
Italy
300,000.00
90,885,000.00
Enel.Factor SpA
Enel.Newhydro Srl
Enel.si Srl
Rome
Rome
Rome
Italy
Italy
Italy
12,500,000.00
1,000,000.00
USD
Electricity generation
Line-by-line
Enel Geothermal
100.00% 34.83%
from renewable
resources
LLC
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power North
America Inc.
USD
Electricity generation
Line-by-line
Chi Power Inc.
100.00% 68.29%
from renewable
resources
Electricity trading
Line-by-line
Enel Trade SpA 100.00% 100.00%
Electricity sourcing and
Line-by-line
Enel Trade SpA 100.00% 100.00%
trading
Electricity trading
Line-by-line
Enel Trade SpA 100.00% 100.00%
Fuel trading and
Line-by-line
Enel SpA
100.00% 100.00%
logistics - Electricity
sales
Factoring
Line-by-line
Engineering and water
Line-by-line
systems
Enel SpA
Enel SpA
100.00% 100.00%
100.00% 100.00%
HRK
RON
EUR
EUR
EUR
EUR
5,000,000.00
EUR
Plant engineering and
Line-by-line
Enel Energia SpA 100.00% 100.00%
energy services
Enelco SA
Athens
Greece
60,108.80
EUR
Plant construction,
Line-by-line
Enel Investment
75.00% 75.00%
operation and
maintenance
Holding BV
Enelpower Contractor
Riyadh
Saudi Arabia
5,000,000.00
SAR
Plant construction,
Line-by-line
Enelpower SpA 51.00% 51.00%
And Development
Saudi Arabia Ltd
operation and
maintenance
Enelpower do Brasil
Rio de Janeiro Brazil
1,242,000.00
BRL
Electrical engineering
Line-by-line
Enel Green
99.99%
68.29%
Ltda
Power Brasil
Participações
Ltda
Enel Green
0.01%
Power Latin
America Ltda
Enelpower SpA
Milan
Italy
2,000,000.00
EUR
Engineering and
Line-by-line
Enel SpA
100.00% 100.00%
construction
Energética de Rosselló
Barcelona
Spain
3,606,060.00
EUR
Cogeneration of
Equity
Enel Green
27.00% 18.63%
AIE
electricity and heat
Power España SL
Energía de La Loma
Jaén
Spain
4,450,000.00
EUR
Biomass
Line-by-line
Enel Green
60.00% 41.41%
SA
Power España SL
Energia Eolica Srl
Rome
Italy
4,840,000.00
EUR
Electricity generation
Line-by-line
Enel Green Power
100.00% 68.29%
from renewable
resources
SpA
Energía Global de
Mexico City
Mexico
50,000.00
MXN
Electricity generation
Line-by-line
Enel Green
99.00% 67.61%
México (Enermex) SA
de Cv
from renewable
resources
Power
International BV
Energía Global
San José
Costa Rica
10,000.00
CRC
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Operaciones SA
from renewable
resources
Power
Costa Rica SA
Energía Limpia de Palo
Mexico City
Mexico
613,953,610.00
MXN
Electricity generation
Line-by-line
Enel Green
99.99%
68.29%
Alto S de RL de Cv
from renewable
resources
Power México S
de RL de Cv
Energía Marina SpA
Santiago
Chile
2,404,240,000.00
CLP
Electricity generation
Equity
Enel Green
25.00% 17.06%
from renewable
resources
Power Chile Ltda
Hidroelectricidad
0.01%
del Pacífico S de
RL de Cv
417
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Energía Nueva de Iguu
Mexico City
Mexico
41,582,307.00
MXN
Electricity generation
Line-by-line
Enel Green
99.90%
68.23%
S de RL de Cv
from renewable
resources
Power México S
de RL de Cv
Energía Nueva
0.01%
Energía Limpia
México S de RL
de Cv
Energía Nueva Energía
Mexico City
Mexico
5,339,650.00
MXN
Electricity generation
Line-by-line
Enel Green
0.04%
68.29%
Limpia México S de RL
de Cv
from renewable
resources
Power Guatemala
SA
Enel Green
99.96%
Power
International BV
Energías Alternativas
Las Palmas de
Spain
5,589,393.00
EUR
Electricity generation
Line-by-line
Enel Green
53.77% 37.11%
del Sur SL
Gran Canaria
from renewable
resources
Power España SL
Energías de Aragón
Zaragoza
Spain
3,200,000.00
EUR
Electricity transmission,
Line-by-line
Endesa Red SA 100.00% 70.10%
I SL
distribution and sale
Energías de Aragón
Zaragoza
Spain
18,500,000.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 69.01%
II SL
Power España SL
Energías de Graus SL Barcelona
Spain
1,298,160.00
EUR
Hydroelectric plants
Line-by-line
Enel Green
66.67% 46.01%
Power España SL
Energías de La Mancha
Villarta de San
Spain
279,500.00
EUR
Biomass
Line-by-line
Enel Green
68.42% 47.22%
SA
Juan
(Ciudad Real)
Power España SL
Energías Especiales
La Coruña
Spain
270,450.00
EUR
Electricity generation
Line-by-line
Enel Green
77.00% 53.14%
de Careón SA
from renewable
resources
Power España SL
Energías Especiales
Madrid
Spain
963,300.00
EUR
Electricity generation
Line-by-line
Enel Green
80.00% 55.21%
de Pena Armada SA
from renewable
resources
Power España SL
Energías Especiales
Madrid
Spain
1,722,600.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 69.01%
del Alto Ulla SA
from renewable
resources
Power España SL
Energías Especiales
Torre del Bierzo Spain
1,635,000.00
EUR
Electricity generation
Equity
Enel Green
50.00% 34.51%
del Bierzo SA
from renewable
resources
Power España SL
Energías Renovables
Mexico City
Mexico
656,615,400.00
MXN
Electricity generation
Line-by-line
Enel Green
99.99%
68.29%
La Mata SAPI de Cv
from renewable
resources
Power México S
de RL de Cv
Energía Nueva
0.01%
de Iguu S de RL
de Cv
Energie Electrique de
Tangeri
Morocco
750,400,000.00
MAD
Combined-cycle
Equity
Endesa
32.00% 22.43%
Tahaddart SA
generation plants
Generación SA
Energosluzby AS
Trnava
Slovakia
33,194.00
EUR
Business services
-
Slovenské
100.00% 66.00%
(in liquidation)
elektrárne AS
Energotel AS
Bratislava
Slovakia
2,191,200.00
EUR
Operation of optical
Held for sale
Slovenské
20.00% 13.20%
fiber network
elektrárne AS
ENergy Hydro Piave Srl Soverzene
Italy
800,000.00
EUR
Electricity purchases
Line-by-line
Enel Produzione
51.00% 51.00%
and sales
SpA
Enerlasa SA (in
Madrid
Spain
1,021,700.58
EUR
Electricity generation
-
Enel Green
45.00% 31.06%
liquidation)
from renewable
resources
Power España SL
Enerlive Srl
Rome
Italy
6,520,000.00
EUR
Electricity generation
Line-by-line
Maicor Wind Srl 100.00% 40.97%
from renewable
resources
Enersis SA
Santiago
Chile
5,669,280.72
CLP
Electricity generation
Line-by-line
Enel
40.32%
60.62%
and distribution
Latinoamérica SA
Enel Iberoamérica
20.30%
Srl
418
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Eólica del Noroeste SL La Coruña
Spain
36,100.00
EUR
Wind plant
Line-by-line
Enel Green
51.00% 35.20%
development
Power España SL
Eólica del Principado
Oviedo
Spain
90,000.00
EUR
Electricity generation
Equity
Enel Green
40.00% 27.61%
SAU
from renewable
resources
Power España SL
Eólica Fazenda
Rio Grande do
Brazil
1,839,000.00
BRL
Wind plants
Line-by-line
Enel Brasil SA
99.95% 51.13%
Nova - Generação e
Norte
Comercialização de
Energia SA
Eólica Valle del Ebro
Zaragoza
Spain
5,559,340.00
EUR
Electricity generation
Line-by-line
Enel Green
50.50% 34.85%
SA
from renewable
resources
Power España SL
Eólica Zopiloapan SAPI
Mexico City
Mexico
1,877,201,540.00
MXN
Electricity generation
Line-by-line
Enel Green
56.98%
65.88%
de Cv
from renewable
resources
Power México S
de RL de Cv
Enel Green
39.50%
Power
Partecipazioni
Speciali Srl
Eólicas de Agaete SL
Las Palmas de
Spain
240,400.00
EUR
Electricity generation
Line-by-line
Enel Green
80.00% 55.21%
Gran Canaria
from renewable
resources
Power España SL
Eólicas de Fuencaliente
Las Palmas de
Spain
216,360.00
EUR
Electricity generation
Line-by-line
Enel Green
55.00% 37.96%
SA
Gran Canaria
from renewable
resources
Power España SL
Eólicas de
Fuerteventura
Spain
-
EUR
Electricity generation
Equity
Enel Green
40.00% 27.61%
Fuerteventura AIE
(Las Palmas)
from renewable
resources
Power España SL
Eólicas de La Patagonia
Buenos Aires
Argentina
480,930.00
ARS
Electricity generation
Equity
Enel Green
50.00% 34.51%
SA
from renewable
resources
Power España SL
Eólicas de Lanzarote
Las Palmas de
Spain
1,758,000.00
EUR
Electricity generation
Equity
Enel Green
40.00% 27.61%
SL
Gran Canaria
and distribution
Power España SL
Eólicas de Tenerife AIE Santa Cruz de
Spain
420,708.40
EUR
Electricity generation
Equity
Enel Green
50.00% 34.51%
Tenerife
from renewable
resources
Power España SL
Eólicas de Tirajana AIE Las Palmas de
Spain
-
EUR
Electricity generation
Line-by-line
Enel Green
60.00% 41.41%
Gran Canaria
from renewable
resources
Power España SL
Erdwärme Oberland
Munich
Germany
116,667.00
EUR
Electricity generation
Line-by-line
Enel Green
78.57% 53.65%
GmbH
from renewable
resources
Power
International BV
Essex Company LLC
Boston
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
(Massachusetts)
from renewable
resources
Hydro Holdings
LLC
Estrellada SA
Montevideo
Uruguay
448,000.00
UYU
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power Uruguay
SA
Explotaciones Eólicas
Zaragoza
Spain
3,505,000.00
EUR
Electricity generation
Line-by-line
Enel Green
70.00% 48.31%
de Escucha SA
from renewable
resources
Power España SL
Explotaciones Eólicas
Teruel
Spain
3,230,000.00
EUR
Electricity generation
Line-by-line
Enel Green
73.60% 50.79%
El Puerto SA
from renewable
resources
Power España SL
Explotaciones Eólicas
Zaragoza
Spain
5,488,500.00
EUR
Electricity generation
Line-by-line
Enel Green
65.00% 44.86%
Saso Plano SA
from renewable
resources
Power España SL
Explotaciones Eólicas
Zaragoza
Spain
8,046,800.00
EUR
Electricity generation
Line-by-line
Enel Green
90.00% 62.11%
Sierra Costera SA
from renewable
resources
Power España SL
Explotaciones Eólicas
Zaragoza
Spain
4,200,000.00
EUR
Electricity generation
Line-by-line
Enel Green
90.00% 62.11%
Sierra La Virgen SA
from renewable
resources
Power España SL
419
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Fiesta City Solar LLC Delaware
USA
Share
capital
-
Currency Activity
Consolidaton
method
USD
Electricity generation
Line-by-line
from renewable
resources
%
Group %
holding
holding
100.00% 68.29%
Held by
Aurora
Distributed Solar
LLC
Florence Hills LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Fotovoltaica Insular SL Las Palmas de
Spain
3,008.00
EUR
Photovoltaic plants
Equity
Endesa Ingeniería
50.00% 35.05%
Gran Canaria
SLU
Fowler Hydro LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power North
America Inc.
Fuentes Renovables
Guatemala
Guatemala
5,000.00
GTQ
Electricity generation
Line-by-line
Renovables de
40.00%
68.29%
de Guatemala SA
from renewable
resources
Guatemala SA
Enel Green
60.00%
Power Guatemala
SA
Fulcrum LLC
Boise (Idaho)
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
from renewable
resources
Hydro Holdings
LLC
Garob Wind Farm
Gauteng
South Africa
100
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Pty) Ltd
from renewable
resources
Power RSA (Pty)
Ltd
Gas Atacama Chile SA Santiago
Chile
185,025,186.00
USD
Electricity generation
Line-by-line
Gas Atacama SA
99.90%
36.80%
Gas Atacama SA
Santiago
Chile
291,484,088.00
USD
Holding company
Line-by-line
Inversiones
100.00% 36.82%
Gasatacama
Holding Ltda
Gas y Electricidad
Palma de
Spain
213,775,700.00
EUR
Electricity generation
Line-by-line
Endesa
100.00% 70.10%
Generación SAU
Mallorca
Generación SA
Gasoducto Atacama
Santiago
Chile
208,173,124.00
USD
Natural gas transport Line-by-line
Gas Atacama SA
57.23%
36.80%
Argentina SA
Compañía
0.05%
Eléctrica Tarapacá
SA
Compañía
0.03%
Eléctrica Tarapacá
SA
Gas Atacama
42.71%
Chile SA
Gasoducto Atacama
Buenos Aires
Argentina
-
ARS
Natural gas transport
Line-by-line
Gasoducto
100.00% 36.80%
Argentina SA Sucursal
Argentina
Atacama
Argentina SA
Gasoducto Taltal SA
Santiago
Chile
18,638.52
CLP
Natural gas transport
Line-by-line
Gasoducto
0.12%
36.80%
Atacama
Argentina SA
Gas Atacama
99.88%
Chile SA
Gauley Hydro LLC
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Delaware)
Willison
(Vermont)
Gauley River
Management
Corporation
from renewable
resources
Power North
America Inc.
USA
1.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power North
America Inc.
Gauley River Power
Willison
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
Partners LLC
(Vermont)
from renewable
resources
Hydro Holdings
LLC
Guatemala
Guatemala
16,261,697.33
GTQ
Electricity generation
Line-by-line
Enel Green
1.00%
68.29%
from renewable
resources
Power Guatemala
SA
Enel Green
99.00%
Power
International BV
Generadora de
Occidente Ltda
420
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Generadora Eólica Alto
Panama
Panama
10,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Pacora SA
from renewable
resources
Power Panama
SA
Generadora Estrella
Panama
Panama
10,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Solar SA
from renewable
resources
Power Panama
SA
Generadora
Panama
Panama
10,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Fotovoltaica Chiriquí SA
from renewable
resources
Power Panama
SA
Generadora
Guatemala
Guatemala
3,820,000.00
GTQ
Electricity generation
Line-by-line
Enel Green
0.01%
68.29%
Montecristo SA
from renewable
resources
Power Guatemala
SA
Generadora Solar
Panama
Panama
10,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Tolé SA
from renewable
resources
Power Panama
SA
Generalima SA
Lima
Generandes Perú SA Lima
Peru
Peru
146,534,335.00
853,429,020.00
PEN
PEN
Holding company
Line-by-line
Enersis SA
100.00% 60.62%
Holding company
Line-by-line
Empresa
61.00%
45.82%
Enel Green
99.99%
Power
International BV
Nacional de
Electricidad SA
Enersis SA
39.00%
Geotérmica del Norte
Santiago
Chile
120,068,349,979.00
CLP
Electricity generation
Line-by-line
Enel Green
68.31% 46.61%
SA
from renewable
resources
Power Chile Ltda
Gibson Bay Wind Farm
Johannesburg South Africa
1,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
60.00% 40.97%
(RF) (Pty) Ltd
from renewable
resources
Power RSA (Pty)
Ltd
Gnl Chile SA
Santiago
Chile
3,026,160.00
USD
Design and LNG supply Equity
Empresa Nacional
33.33% 12.12%
de Electricidad SA
Gnl Norte SA
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Gas Atacama
50.00%
36.80%
Chile SA
Gasoducto Taltal
50.00%
SA
Gnl Quintero SA
Santiago
Chile
114,057,353.00
USD
Design and LNG supply Equity
Empresa Nacional
20.00% 7.27%
de Electricidad SA
Goodwell Wind Project
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Origin Goodwell
100.00% 34.83%
LLC
(Delaware)
from renewable
resources
Holdings LLC
Goodyear Lake Hydro
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
LLC
from renewable
resources
Power North
America Inc.
Gorona del Viento El
Valverde de El
Spain
30,936,736.00
EUR
Development and
Equity
Unión Eléctrica
23.21% 16.27%
Hierro SA
Hierro
maintenance of El
Hierro generation plant
de Canarias
Generación SAU
Green Fuel Corporación
Madrid
Spain
1,717,049.55
EUR
Electricity generation
-
Enel Green
24.24% 16.73%
SA (in liquidation)
from renewable
resources
Power España SL
Guadarranque Solar 4
Seville
Spain
3,006.00
EUR
Electricity generation
Line-by-line
Endesa
100.00% 70.10%
SL Unipersonal
from renewable
resources
Generación II SA
GV Energie Rigenerabili
Bucharest
Romania
1,145,400.00
RON
Electricity generation
Line-by-line
Enel Green
0.00%
68.29%
ITAL-RO Srl
from renewable
resources
Power
International BV
Hadley Ridge LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Enel Green
100.00%
Power Romania
Srl
421
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Hastings Solar LLC
Delaware
USA
Share
capital
-
Currency Activity
Consolidaton
method
USD
Electricity generation
Line-by-line
from renewable
resources
%
Group %
holding
holding
100.00% 68.29%
Held by
Aurora
Distributed Solar
LLC
Helio Atacama Nueve
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Enel Green
100.00% 68.23%
SpA
from renewable
resources
Power Chile Ltda
Hidroeléctrica de
Barcelona
Spain
126,210.00
EUR
Electricity transmission
Line-by-line
Endesa Red SA 100.00% 70.10%
Catalunya SL
and distribution
Hidroeléctrica de
Lugo
Spain
1,608,200.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.70%
Ourol SL
from renewable
resources
Power España SL
Hidroeléctrica Don
San José
Costa Rica
10,000.00
CRC
Electricity generation
Line-by-line
Enel Green
65.00% 44.39%
Rafael SA
from renewable
resources
Power Costa
Rica SA
Hidroeléctrica El
Buenos Aires
Argentina
298,584,050.00
ARS
Electricity generation
Line-by-line
Hidroinvest SA
59.00%
23.77%
Chocón SA
and sale
Empresa Nacional
2.48%
de Electricidad SA
Endesa Argentina
6.19%
SA
Hidroelectricidad del
Mexico City
Mexico
30,890,736.00
MXN
Electricity generation
Line-by-line
Enel Green
99.99% 68.28%
Pacífico S de RL de Cv
from renewable
resources
Power México S
de RL de Cv
Hidroflamicell SL
Barcelona
Spain
78,120.00
EUR
Electricity distribution
Line-by-line
Hidroeléctrica de
75.00% 52.58%
and sale
Catalunya SL
Hidroinvest SA
Buenos Aires
Argentina
55,312,093.00
ARS
Holding company
Line-by-line
Endesa Argentina
54.15%
34.94%
SA
Empresa Nacional
41.94%
de Electricidad SA
Hidromondego -
Lisbon
Portugal
3,000.00
EUR
Hydroelectric power
Line-by-line
Endesa
10.00%
70.10%
Hidroeléctrica do
Mondego Lda
Generación
Portugal SA
Endesa
90.00%
Generación SA
High Shoals LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
from renewable
resources
Hydro Holdings
LLC
Highfalls Hydro
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Company Inc.
(Delaware)
from renewable
resources
Power North
America Inc.
Hispano Generación de
Jerez de los
Spain
3,500.00
EUR
Electricity generation
Line-by-line
Enel Green
51.00% 35.20%
Energía Solar SL
Caballeros
(Badajoz)
from renewable
resources
Power España SL
Hope Creek LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Hydro Development
Albany (New
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
Group Acquisition LLC
York)
from renewable
resources
Hydro Holdings
LLC
Hydro Dolomiti Enel Srl Trento
Italy
3,000,000.00
EUR
Electricity generation,
Held for sale
Enel Produzione
49.00% 49.00%
Hydro Energies
Corporation
Willison
(Vermont)
USA
5,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
purchases and sales
SpA
from renewable
resources
Power North
America Inc.
Hydrogen Park-
Venice
Italy
245,000.00
EUR
Development of
Line-by-line
Enel Produzione
60.00% 60.00%
Marghera per
l’idrogeno Scrl
studies and projects for
the use of hydrogen
SpA
Hydromac Energy BV Amsterdam
The
18,000.00
EUR
Holding company
Line-by-line
Enel Green
100.00% 68.29%
Netherlands
Power
International BV
I-EM Srl
Turin
Italy
28,571.43
EUR
Design and
Equity
Enel Italia Srl
30.00% 30.00%
development
422
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Ingendesa do Brasil
Rio de Janeiro Brazil
500,000.00
BRL
Design, engineering
Line-by-line
Empresa Nacional
1.00%
37.27%
Ltda
and consulting
de Electricidad SA
Inkolan Información y
Bilbao
Spain
84,140.00
EUR
Information on
Equity
Coordinación de obras
AIE
infrastructure of Inkolan
associates
Compañía
99.00%
Eléctrica Tarapacá
SA
Endesa
Distribución
Eléctrica SL
14.29% 10.02%
International Endesa
Amsterdam
The
15,428,520.00
EUR
Holding company
Line-by-line
Endesa SA
100.00% 70.10%
BV
Netherlands
International
Rome
Italy
24,000.00
EUR
Long-distance learning -
Enel Italia Srl
13.04% 13.04%
Multimedia University
Srl
(in bankruptcy)
Inversiones Distrilima
Lima
Peru
714,233,174.00
PEN
Holding company
Line-by-line
Enersis SA
69.85%
60.45%
SA
Inversiones
Santiago
Chile
333,520,000.00
USD
Natural gas transport
Line-by-line
Empresa Nacional
50.00%
36.82%
Chilectra SA
30.15%
Gasatacama Holding
Ltda
de Electricidad SA
Compañía
50.00%
Eléctrica Tarapacá
SA
Inversora Codensa Sas Bogotá DC
Colombia
5,000,000.00
COP
Electricity transmission
Line-by-line
Codensa SA ESP 100.00% 29.34%
and distribution
Inversora Dock Sud SA Buenos Aires
Argentina
241,490,000.00
Isamu Ikeda Energia
Rio de Janeiro Brazil
61,474,475.77
ARS
BRL
Holding company
Line-by-line
Enersis SA
57.14% 34.64%
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
SA
and sale
Power Brasil
Participações
Ltda
Italgest Energy (Pty)
Johannesburg South Africa
1,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Ltd
from renewable
resources
Power RSA (Pty)
Ltd
Jack River LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Jessica Mills LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Julia Hills LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Kalenta SA
Maroussi
Greece
4,359,000.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power Solar
Energy Srl
Kavacik Eolìko Enerjì
Istanbul
Turkey
9,000,000.00
TRY
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Elektrìc Üretìm ve
Tìcaret Anonìm S¸ìrketì
from renewable
resources
Power Turkey
Enerji Yatirimlari
Anonim S¸ìrketì
Kelley’s Falls LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power North
America Inc.
Kings River Hydro
Wilmington
USA
100.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Company Inc.
(Delaware)
from renewable
resources
Power North
America Inc.
Kinneytown Hydro
Wilmington
USA
100.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Company Inc.
(Delaware)
from renewable
resources
Power North
America Inc.
Kirklarelì Eolìko Enerjì
Istanbul
Turkey
5,250,000.00
TRY
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Elektrìk Üretìm ve
Tìcaret Anonìm S¸ìrketì
from renewable
resources
Power Turkey
Enerji Yatirimlari
Anonim S¸ìrketì
Kongul Energì Sanayi
Istanbul
Turkey
125,000,000.00
TRY
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
ve Tìcaret Anonìm
S¸ìrketì
from renewable
resources
Power Turkey
Enerji Yatirimlari
Anonim S¸ìrketì
Kromschroeder SA
Barcelona
Spain
627,126.00
EUR
Services
Equity
Endesa Red SA 29.26% 20.51%
423
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
La Pereda Co2 AIE
Oviedo
Spain
224,286.00
EUR
Services
Consolidaton
method
Equity
Held by
Endesa
Generación SA
%
Group %
holding
holding
33.33% 23.36%
LaChute Hydro
Wilmington
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
Company LLC
(Delaware)
from renewable
resources
Hydro Holdings
LLC
Lake Emily Solar LLC Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora
100.00% 68.29%
from renewable
resources
Distributed Solar
LLC
Lake Pulaski Solar LLC Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora
100.00% 68.29%
from renewable
resources
Distributed Solar
LLC
Lawrence Creek Solar
Minnesota
USA
-
USD
Electricity generation
Line-by-line
Aurora
100.00% 68.29%
LLC
from renewable
resources
Distributed Solar
LLC
Lester Prairie Solar LLC Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora
100.00% 68.29%
from renewable
resources
Distributed Solar
LLC
Lindahl Wind Project
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Kansas LLC 100.00% 68.29%
LLC
from renewable
resources
Little Elk Wind
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Kansas LLC 100.00% 68.29%
Holdings LLC
from renewable
resources
Little Elk Wind Project
Oklahoma City
USA
-
USD
Electricity generation
Line-by-line
Enel Kansas LLC 100.00% 68.29%
LLC
(Oklahoma)
from renewable
resources
Littleville Power
Boston
USA
1.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Company Inc.
(Massachusetts)
from renewable
resources
Power North
America Inc.
Llano Sánchez Solar
Panama
Panama
10,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Power One SA
from renewable
resources
Power Panama
SA
Llano Sánchez Solar
Panama
Panama
10,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Power Cuatro SA
from renewable
resources
Power Panama
SA
Llano Sánchez Solar
Panama
Panama
10,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Power Tres SA
from renewable
resources
Power Panama
SA
Lower Saranac Hydro
Delaware
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
Partners LLC
from renewable
resources
Hydro Holdings
LLC
Lower Saranac Hydro
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
LLC
from renewable
resources
Power North
America Inc.
Lower Valley LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
from renewable
resources
Hydro Holdings
LLC
Lowline Rapids LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
from renewable
resources
Hydro Holdings
LLC
Luz Andes Ltda
Santiago
Chile
1,224,348.00
CLP
Electricity and fuel
Line-by-line
Chilectra SA
99.90%
70.08%
transport, distribution
and sale
Enersis SA
0.10%
Maicor Wind Srl
Rome
Italy
20,850,000.00
EUR
Electricity generation
Line-by-line
Enel Green
60.00% 40.97%
from renewable
resources
Power SpA
Marcinelle Energie SA Charleroi
Belgium
110,061,500.00
EUR
Electricity generation,
Line-by-line
Enel Investment
100.00% 100.00%
transport, sale and
trading
Holding BV
Marte Srl
Rome
Italy
5,100,000.00
EUR
Electricity generation
Line-by-line
Enel Green
98.00%
68.29%
from renewable
resources
Power SpA
Enel Green
2.00%
Power Solar
Energy Srl
424
Annual Report 2015 Company name
Headquarters Country
Mascoma Hydro
Concord (New
USA
Corporation
Hampshire)
Share
capital
1.00
Currency Activity
method
Held by
holding
holding
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Consolidaton
%
Group %
from renewable
resources
Power North
America Inc.
Mason Mountain Wind
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Padoma Wind
100.00% 68.29%
Project LLC
(Delaware)
from renewable
resources
Power LLC
Matrigenix (Pty) Ltd
Houghton
South Africa
1,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power RSA (Pty)
Ltd
Medidas Ambientales
Medina de
Spain
60,100.00
EUR
Environmental studies Equity
Nuclenor SA
50.00% 17.53%
SL
Pomar (Burgos)
Metro Wind LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Mexicana de
Mexico City
Mexico
181,728,701.00
MXN
Electricity generation
Line-by-line
Enel Green
99.99% 68.28%
Hidroelectricidad
Mexhidro S de RL
de Cv
from renewable
resources
Power México S
de RL de Cv
Mill Shoals Hydro
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Company ILLC
(Delaware)
from renewable
resources
Power North
America Inc.
Minas de Estercuel SA Madrid
Minas Gargallo SL
Madrid
Spain
Spain
93,160.00
150,000.00
EUR
EUR
Mineral deposits
Line-by-line
Minas Gargallo SL99.65% 69.79%
Mineral deposits
Line-by-line
Endesa
99.91% 70.04%
Generación SA
Minicentrales del Canal
Zaragoza
Spain
1,202,000.00
EUR
Hydroelectric plants
-
Enel Green
15.00% 10.35%
de Las Bárdenas AIE
Power España SL
Minicentrales del Canal
Zaragoza
Spain
1,820,000.00
EUR
Hydroelectric plants
Equity
Enel Green
36.50% 25.19%
Imperial-Gallur SL
Power España SL
Mira Energy (Pty) Ltd Houghton
South Africa
100.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power RSA (Pty)
Ltd
Missisquoi Associates
Los Angeles
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
LLC
(California)
from renewable
resources
Hydro Holdings
LLC
Montrose Solar LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora
100.00% 68.29%
from renewable
resources
Distributed Solar
LLC
Nevkan Renewables
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Nevkan Inc. 100.00% 68.29%
LLC
(Delaware)
from renewable
resources
Newbury Hydro
Delaware
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
Company LLC
from renewable
resources
Hydro Holdings
LLC
Newind Group Inc.
St. John
Canada
578,192.00
CAD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Newfoundland)
from renewable
resources
Power Canada
Inc.
Nojoli Wind Farm (RF)
Johannesburg South Africa
10,000,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
60.00% 40.97%
(Pty) Ltd
North Canal
Waterworks
Boston
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Massachusetts)
from renewable
resources
Power North
America Inc.
from renewable
resources
Power RSA (Pty)
Ltd
Northwest Hydro LLC Wilmington
USA
-
USD
Electricity generation
Line-by-line
Chi West LLC
100.00% 68.29%
(Delaware)
from renewable
resources
Notch Butte Hydro
Wilmington
USA
100.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Company Inc.
(Delaware)
from renewable
resources
Power North
America Inc.
Nuclenor SA
Burgos
Spain
102,000,000.00
EUR
Nuclear plant
Equity
Endesa
50.00% 35.05%
Generación SA
Nueva Marina Real
Madrid
Spain
3,200.00
EUR
Real estate
Line-by-line
Endesa Servicios
60.00% 42.06%
Estate SL
SL
Nuove Energie Srl
Porto
Italy
54,410,000.00
EUR
Construction and
Line-by-line
Enel Trade SpA 100.00% 100.00%
Empedocle
management of
LNG regasification
infrastructure
425
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Ochrana A Bezpecnost
Mochovce
Slovakia
33,193.92
EUR
Security services
Held for sale
Slovenské
100.00% 66.00%
Se AS
elektrárne AS
Odell Sponsorco LLC Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Kansas LLC 50.00% 34.14%
from renewable
resources
OGK-5 Finance LLC Moscow
Russian
10,000,000.00
RUB
Finance company
Line-by-line
Enel Russia PJSC 100.00% 56.43%
Federation
Origin Goodwell
Wilmington
USA
-
USD
Electricity generation
Line-by-line
EGPNA Wind
100.00% 34.83%
Holdings LLC
(Delaware)
from renewable
resources
Holdings 1 LLC
Origin Wind Energy
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Origin Goodwell
100.00% 34.83%
LLC
(Delaware)
from renewable
resources
Holdings LLC
Osage Wind Holdings
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Kansas LLC 100.00% 68.29%
LLC
from renewable
resources
Osage Wind LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Osage Wind
50.00% 34.14%
from renewable
resources
Holdings LLC
Ottauquechee Hydro
Wilmington
USA
100.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Company Inc.
(Delaware)
from renewable
resources
Power North
America Inc.
Ovacik Eolìko Enerjì
Istanbul
Turkey
11,250,000.00
TRY
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Elektrìk Üretìm ve
Tìcaret Anonìm S¸ìrketì
from renewable
resources
Power Turkey
Enerji Yatirimlari
Anonim S¸ìrketì
Oxagesa AIE
Teruel
Spain
6,010.00
EUR
Cogeneration of
Equity
Enel Green
33.33% 23.00%
electricity and heat
Power España SL
Oyster Bay Wind Farm
Cape Town
South Africa
1,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Pty) Ltd
from renewable
resources
Power RSA (Pty)
Ltd
P.E. Cote SA
San José
Costa Rica
10,000.00
CRC
Electricity generation
Line-by-line
Enel Green
65.00% 44.39%
from renewable
resources
Power Costa
Rica SA
P.V. Huacas SA
San José
Costa Rica
10,000.00
CRC
Electricity generation
Line-by-line
Enel Green
65.00% 44.39%
from renewable
resources
Power Costa
Rica SA
Padoma Wind Power
Los Angeles
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
LLC
(California)
from renewable
resources
Power North
America Inc.
Palo Alto Farms Wind
Dallas (Texas) USA
-
USD
Electricity generation
Line-by-line
Enel Kansas LLC 100.00% 68.29%
Project LLC
from renewable
resources
Pampa Solar Norte
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Helio Atacama
100.00% 68.23%
Cuatro SpA
from renewable
resources
Nueve SpA
Pampa Solar Norte
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Helio Atacama
100.00% 68.23%
Dos SpA
from renewable
resources
Nueve SpA
Pampa Solar Norte
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Helio Atacama
100.00% 68.23%
Uno SpA
from renewable
resources
Nueve SpA
Paravento SL
Lugo
Spain
3,006.00
EUR
Electricity generation
Line-by-line
Enel Green
90.00% 62.11%
from renewable
resources
Power España SL
Parc Eolic Els Aligars
Barcelona
Spain
1,313,100.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.70%
SL
from renewable
resources
Power España SL
Parc Eolic La Tossa-La
Barcelona
Spain
1,183,100.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.70%
Mola D’en Pascual SL
from renewable
resources
Power España SL
Parque Eólico A
Santiago de
Spain
5,857,586.40
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 69.01%
Capelada AIE
Compostela
from renewable
resources
Power España SL
426
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Parque Eólico Carretera
Las Palmas de
Spain
1,603,000.00
EUR
Electricity generation
Line-by-line
Enel Green
80.00% 55.21%
de Arinaga SA
Gran Canaria
from renewable
resources
Power España SL
Parque Eólico de
Zaragoza
Spain
601,000.00
EUR
Electricity generation
Line-by-line
Enel Green
80.00% 55.21%
Aragón AIE
from renewable
resources
Power España SL
Parque Eólico de
La Coruña
Spain
3,606,000.00
EUR
Electricity generation
Line-by-line
Enel Green
75.00% 51.76%
Barbanza SA
from renewable
resources
Power España SL
Parque Eólico de
Madrid
Spain
120,400.00
EUR
Electricity generation
Line-by-line
Enel Green
50.16% 34.62%
Belmonte SA
from renewable
resources
Power España SL
Parque Eólico de San
La Coruña
Spain
552,920.00
EUR
Electricity generation
Line-by-line
Enel Green
82.00% 56.59%
Andrés SA
from renewable
resources
Power España SL
Parque Eólico de Santa
Las Palmas de
Spain
901,500.00
EUR
Electricity generation
Line-by-line
Enel Green
65.67% 45.32%
Lucía SA
Gran Canaria
from renewable
resources
Power España SL
Parque Eólico Finca de
Las Palmas de
Spain
3,810,340.00
EUR
Construction and
Line-by-line
Enel Green
90.00% 62.11%
Mogán SA
Gran Canaria
operation of wind
plants
Power España SL
Parque Eólico Montes
Madrid
Spain
6,540,000.00
EUR
Construction and
Line-by-line
Enel Green
75.50% 52.11%
de Las Navas SA
operation of wind
plants
Power España SL
Parque Eólico Punta de
Tenerife
Spain
528,880.00
EUR
Electricity generation
Line-by-line
Enel Green
52.00% 35.89%
Teno SA
from renewable
resources
Power España SL
Parque Eólico Renaico
Santiago
Chile
1,000,000.00
CLP
Electricity generation
Line-by-line
Enel Green
100.00% 68.23%
SpA
from renewable
resources
Power Chile Ltda
Parque Eólico Sierra
Soria
Spain
7,193,970.00
EUR
Electricity generation
Line-by-line
Enel Green
58.00% 40.03%
del Madero SA
from renewable
resources
Power España SL
Parque Eólico Taltal SA Santiago
Chile
20,878,010,000.00
CLP
Electricity generation
Line-by-line
Enel Green
0.01%
68.23%
from renewable
resources
Power Latin
America Ltda
Enel Green
99.99%
Power Chile Ltda
Parque Eólico Valle de
Santiago
Chile
566,096,564.00
CLP
Electricity generation
Line-by-line
Enel Green
0.01%
68.23%
los Vientos SA
from renewable
resources
Power Latin
America Ltda
Parque Solar Carrera
Santiago
Chile
10,000,000.00
CLP
Electricity generation
Line-by-line
Enel Green
99.00% 67.54%
Pinto SA
from renewable
resources
Power Chile Ltda
Parque Talinay Oriente
Santiago
Chile
66,092,165,171.00
CLP
Electricity generation
Line-by-line
Enel Green
34.57%
65.17%
Enel Green
99.99%
Power Chile Ltda
SA
from renewable
resources
Power SpA
Enel Green
60.92%
Power Chile Ltda
Paynesville Solar LLC Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora
100.00% 68.29%
from renewable
resources
Distributed Solar
LLC
Pegop - Energia
Abrantes
Portugal
50,000.00
EUR
Electricity generation
Equity
Endesa
0.02%
35.05%
Eléctrica SA
Generación
Portugal SA
Endesa
49.98%
Generación SA
Pelzer Hydro Company
Wilmington
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
LLC
(Delaware)
from renewable
resources
Hydro Holdings
LLC
Pereda Power SL
La Pereda
Spain
5,000.00
EUR
Development of
Line-by-line
Endesa
70.00% 49.07%
(Mieres)
generation activities
Generación II SA
427
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
PH Chucas SA
San José
Costa Rica
100,000.00
CRC
Electricity generation
Line-by-line
Enel Green
22.17%
42.67%
from renewable
resources
Power SpA
Enel Green
40.31%
Power Costa
Rica SA
PH Don Pedro SA
San José
Costa Rica
100,001.00
CRC
Electricity generation
Line-by-line
Enel Green
33.44% 22.84%
from renewable
resources
Power Costa
Rica SA
PH Guacimo SA
San José
Costa Rica
50,000.00
CRC
Electricity generation
Line-by-line
Enel Green
65.00% 44.39%
from renewable
resources
Power Costa
Rica SA
PH Río Vólcan SA
San José
Costa Rica
100,001.00
CRC
Electricity generation
Line-by-line
Enel Green
34.32% 23.44%
Pine Island Distributed
Delaware
USA
-
USD
Electricity generation
Line-by-line
Solar LLC
from renewable
resources
from renewable
resources
Power Costa
Rica SA
Aurora
Distributed Solar
LLC
100.00% 68.29%
Planta Eólica Europea
Seville
Spain
1,198,530.00
EUR
Electricity generation
Line-by-line
Enel Green
56.12% 38.73%
SA
from renewable
resources
Power España SL
PowerCrop
Bologna
Italy
100,000.00
EUR
Electricity generation
Equity
PowerCrop Srl
100.00% 34.14%
Macchiareddu Srl
from renewable
resources
PowerCrop Russi Srl
Bologna
Italy
100,000.00
EUR
Electricity generation
Equity
PowerCrop Srl
100.00% 34.14%
from renewable
resources
PowerCrop Srl
Bologna
Italy
4,000,000.00
EUR
Electricity generation
Equity
Enel Green
50.00% 34.14%
from renewable
resources
Power SpA
Prairie Rose
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Prairie Rose Wind
100.00% 34.83%
Transmission LLC
(Minnesota)
from renewable
resources
LLC
Prairie Rose Wind LLC New York
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
(New York)
from renewable
resources
Wind Holdings
LLC
Primavera Energia SA Rio de Janeiro Brazil
36,965,444.64
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
and sale
Power Brasil
Participações
Ltda
Productor Regional
Valladolid
Spain
88,398.00
EUR
Construction and
Line-by-line
Enel Green
82.89% 57.21%
de Energía Renovable
III SA
operation of wind
plants
Power España SL
Productor Regional de
Valladolid
Spain
710,500.00
EUR
Construction and
Line-by-line
Enel Green
85.00% 58.66%
Energía Renovable SA
operation of wind
plants
Power España SL
Productora de Energías
Barcelona
Spain
30,050.00
EUR
Hydroelectric plants
Equity
Enel Green
30.00% 20.70%
SA
Power España SL
Prof-Energo LLC
Sredneuralsk
Russian
10,000.00
RUB
Energy services
Line-by-line
Sanatorium-
100.00% 56.43%
Federation
Preventorium
Energetik LLC
Progas SA
Santiago
Chile
1,526,000.00
CLP
Gas distribution
Line-by-line
Gas Atacama SA
0.10%
36.80%
Promociones
Ponferrada
Spain
12,020.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 69.01%
Energéticas del Bierzo
SL
Proveedora de
Electricidad de
Occidente S de RL
de Cv
Mexico City
Mexico
89,708,735.00
MXN
Electricity generation
Line-by-line
Enel Green
99.99% 68.28%
from renewable
resources
Power México S
de RL de Cv
from renewable
resources
Power España SL
Proyecto Almería
Madrid
Spain
601,000.00
EUR
Desalinization and
Equity
Endesa SA
45.00% 31.55%
Mediterraneo SA
water supply
Gas Atacama
99.90%
Chile SA
428
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Proyecto Eólico El
San José
Costa Rica
10,000.00
CRC
Electricity generation
Line-by-line
Enel Green
65.00% 44.39%
Pedregal SA
from renewable
resources
Power Costa
Rica SA
Proyectos
Alicante
Spain
180,000.00
EUR
Electricity generation
Equity
Enel Green
33.33% 23.00%
Universitarios de
Energías Renovables
SL
from renewable
resources
Power España SL
PT Bayan Resources
Jakarta
Indonesia
333,333,350,000.00
IDR
Energy
-
Enel Investment
10.00% 10.00%
Tbk
Holding BV
Pulida Energy (RF)
Houghton
South Africa
10,000,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
52.70% 35.99%
(Pty) Ltd
from renewable
resources
Power RSA (Pty)
Ltd
Pyrites Hydro LLC
New York
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
(New York)
from renewable
resources
Hydro Holdings
LLC
Quatiara Energia SA
Rio de Janeiro Brazil
16,566,510.61
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Power Brasil
Participações
Ltda
Rattlesnake Creek
Lincoln
USA
-
USD
Electricity generation
Line-by-line
Enel Kansas LLC 100.00% 68.29%
Wind Project LLC
(Nebraska)
from renewable
resources
Reaktortest Sro
Trnava
Slovakia
66,389.00
EUR
Nuclear power researchHeld for sale
Slovenské
49.00% 32.34%
elektrárne AS
Red Centroamericana
Panama
Panama
2,700,000.00
USD
Telecommunications
-
Enel
11.11% 11.11%
de Telecomunicaciones
SA
Latinoamérica SA
Renovables de
Guatemala
Guatemala
1,924,465,600.00
GTQ
Electricity generation
Line-by-line
Enel Green
0.01%
68.29%
Guatemala SA
from renewable
resources
Power Guatemala
SA
Enel Green
42.83%
Power
International BV
Enel Green
57.16%
Power SpA
Res Holdings BV
Amsterdam
The
18,000.00
EUR
Holding company
Equity
Enel Investment
49.50% 49.50%
Netherlands
Holding BV
Rock Creek Hydro LLC Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Rock Creek Wind
Clayton
USA
Project LLC
(California)
Rocky Caney Wind
New York
USA
LLC
(New York)
-
-
from renewable
resources
Power North
America Inc.
USD
Holding company
Line-by-line
Enel Kansas LLC 100.00% 68.29%
USD
Electricity generation
Line-by-line
Enel Kansas LLC 100.00% 68.29%
from renewable
resources
Rocky Ridge Wind
Oklahoma City
USA
-
USD
Electricity generation
Line-by-line
Rocky Caney
100.00% 68.29%
Project LLC
(Oklahoma)
from renewable
resources
Wind LLC
Rusenergosbyt LLC Moscow
Russian
2,760,000.00
RUB
Electricity trading
Equity
Res Holdings BV 100.00% 49.50%
Federation
Rusenergosbyt Siberia
Krasnoyarskiy
Russian
4,600,000.00
RUB
Electricity sale
Equity
Rusenergosbyt
50.00% 24.75%
LLC
Kray
Federation
LLC
Rusenergosbyt
Yaroslavl
Russian
100,000.00
RUB
Electricity sale
Equity
Rusenergosbyt
50.00% 24.75%
Yaroslavl
Federation
LLC
Ruthton Ridge LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Sacme SA
Buenos Aires
Argentina
12,000.00
ARS
Monitoring of electricity
Equity
Empresa
50.00% 21.70%
system
Distribuidora
Sur SA
Salmon Falls Hydro
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
LLC
from renewable
resources
Power North
America Inc.
429
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Salto de San Rafael SL Seville
Spain
461,410.00
EUR
Hydroelectric plants
Equity
Enel Green
50.00% 34.51%
Power España SL
San Juan Mesa Wind
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Padoma Wind
100.00% 68.29%
Project II LLC
(Delaware)
from renewable
resources
Power LLC
Sanatorium-
Nevinnomyssk Russian
10,571,300.00
RUB
Energy services
Line-by-line
Enel Russia PJSC
99.99%
56.43%
Preventorium Energetik
Federation
LLC
OGK-5 Finance
0.01%
LLC
Santo Rostro
Seville
Spain
207,000.00
EUR
Cogeneration of
-
Enel Green
45.00% 31.06%
Cogeneración SA
(in liquidation)
electricity and heat
Power España SL
Scandia Solar LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora
100.00% 68.29%
from renewable
resources
Distributed Solar
LLC
Se Hazelton A.LLC
Los Angeles
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
(California)
from renewable
resources
Hydro Holdings
LLC
Se Predaj Sro
Bratislava
Slovakia
4,505,000.00
EUR
Electricity supply
Held for sale
Slovenské
100.00% 66.00%
elektrárne AS
SE Služby inžinierskych
Kalná nad
Slovakia
200,000.00
EUR
Services
Held for sale
Slovenské
100.00% 66.00%
stavieb Sro
Hronom
elektrárne AS
Serra do Moncoso
La Coruña
Spain
3,125.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 69.01%
Cambas SL
from renewable
resources
Power España SL
Servicio de Operación
Mexico City
Mexico
3,000.00
MXN
Electricity generation
Line-by-line
Enel Green
0.01% 0.01%
y Mantenimiento para
Energías Renovables S
de RL de Cv
from renewable
resources
Power Guatemala
SA
Servicios Informáticos
Santiago
Chile
61,948,673,981.00
CLP
ICT
Line-by-line
Enersis SA
99.90%
60.62%
e Inmobiliarios Ltda
Chilectra SA
0.10%
SIET - Società
Piacenza
Italy
697,820.00
EUR
Analysis, design and
Equity
Enel.Newhydro
41.55% 41.55%
Informazioni Esperienze
Termoidrauliche SpA
research in thermal
technology
Srl
Sistema Eléctrico de
Granada
Spain
44,900.00
EUR
Electricity generation
Equity
Enel Green
16.70% 11.53%
Conexión Montes
Orientales SL
Power España SL
Sistema Eléctrico de
Madrid
Spain
175,200.00
EUR
Electricity generation
Equity
Enel Green
28.13% 19.41%
Conexión Valcaire SL
Power España SL
Sistemas Energéticos
La Coruña
Spain
2,007,750.00
EUR
Electricity generation
Line-by-line
Enel Green
96.00% 66.25%
Mañón Ortigueira SA
Slate Creek
Associates LP
Los Angeles
USA
-
USD
Electricity generation
Line-by-line
Slate Creek Hydro
95.00% 33.09%
(California)
from renewable
resources
Company LLC
from renewable
resources
Power España SL
Slate Creek Company
Wilmington
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
LLC
(Delaware)
from renewable
resources
Hydro Holdings
LLC
Slovenské elektrárne
Cˆeská republika Sro
Prague
Czech Republic 3,000.00
CZK
Electricity supply
Held for sale
Slovenské
100.00% 66.00%
elektrárne AS
Slovenské elektrárne
Bratislava
Slovakia
1,269,295,724.66
EUR
Electricity generation Held for sale
Enel Produzione
66.00% 66.00%
AS
SpA
Smart P@Per SpA
Potenza
Italy
2,184,000.00
EUR
Services
-
Enel Servizio
10.00% 10.00%
Elettrico SpA
SMART-I Srl
Rome
Italy
14,571.43
EUR
Research, development
Equity
Enel Italia Srl
24.00% 24.00%
and design
Smoky Hills Wind Farm
Topeka
USA
-
USD
Electricity generation
Line-by-line
Texkan Wind LLC 100.00% 68.29%
LLC
(Kansas)
from renewable
resources
Smoky Hills Wind
Topeka
USA
-
USD
Electricity generation
Line-by-line
Nevkan
100.00% 68.29%
Project II LLC
(Kansas)
from renewable
resources
Renewables LLC
430
Annual Report 2015 Company name
Headquarters Country
Snyder Wind Farm LLC Dallas
USA
(Texas)
Share
capital
-
Consolidaton
%
Group %
Currency Activity
method
Held by
holding
holding
USD
Electricity generation
Line-by-line
Texkan Wind LLC 100.00% 68.29%
from renewable
resources
Socibe Energia SA
Rio de Janeiro Brazil
19,969,032.25
BRL
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
and sale
Power Brasil
Participações
Ltda
Sociedad Agrícola de
Santiago
Chile
5,738,046,495.00
CLP
Financial investment
Line-by-line
Servicios
57.50% 34.86%
Cameros Ltda
Informáticos e
Inmobiliarios Ltda
Sociedad Eólica de
Seville
Spain
4,507,590.78
EUR
Electricity generation
Line-by-line
Enel Green
64.74% 44.68%
Andalucía SA
Power España SL
Sociedad Eólica El
Seville
Spain
1,643,000.00
EUR
Electricity generation
Equity
Enel Green
50.00% 34.51%
Puntal SL
from renewable
resources
Power España SL
Sociedad Eólica Los
Cadiz
Spain
2,404,048.42
EUR
Electricity generation
Line-by-line
Enel Green
60.00% 41.41%
Lances SA
from renewable
resources
Power España SL
Sociedad Portuaria
Bogotá DC
Colombia
5,800,000.00
COP
Construction and
Line-by-line
Emgesa SA ESP
94.95%
23.15%
Central Cartagena SA
management of port
infrastructure
Inversora
4.90%
Codensa Sas
Sol de Media Noche
Las Palmas de
Spain
3,008.00
EUR
Photovoltaic plants
Equity
Endesa Ingeniería
50.00% 35.05%
Fotovoltaica SL
Gran Canaria
SLU
Sol Real Istmo SA
Panama
Panama
10,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power Panama
SA
Sol Real Uno SA
Panama
Panama
10,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power Panama
SA
Soliloquoy Ridge LLC Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Somersworth Hydro
Wilmington
USA
100.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Company Inc.
(Delaware)
from renewable
resources
Power North
America Inc.
Sotavento Galicia SA
Santiago de
Spain
601,000.00
EUR
Electricity generation
Equity
Enel Green
36.00% 24.84%
Compostela
from renewable
resources
Power España SL
Southern Cone Power
Buenos Aires
Argentina
19,874,798.00
ARS
Holding company
Line-by-line
Empresa Nacional
98.03%
36.38%
Argentina SA
de Electricidad SA
Compañía
1.97%
Eléctrica Tarapacá
SA
Southwest
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
Transmission LLC
(Minnesota)
from renewable
resources
Wind LLC
Spartan Hills LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Stipa Nayaá SA de Cv Colonia
Mexico
1,811,016,348.00
MXN
Electricity generation
Line-by-line
Enel Green
40.16%
65.13%
Cuauhtémoc
from renewable
resources
Power
Partecipazioni
Speciali Srl
Enel Green
55.21%
Power México S
de RL de Cv
Sublunary Trading (RF)
Johannesburg South Africa
8,757,214.00
ZAR
Electricity generation
Line-by-line
Enel Green
57.00% 38.92%
(Pty) Ltd
from renewable
resources
Power Solar
Energy Srl
Suministradora
Cadiz
Spain
12,020,240.00
EUR
Electricity distribution
Equity
Endesa Red SA 33.50% 23.48%
Eléctrica de Cádiz SA
and supply
431
AttachmentsAnnual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Suministro de Luz y
Torroella de
Spain
2,800,000.00
EUR
Electricity distribution
Line-by-line
Hidroeléctrica de
60.00% 42.06%
Fuerza SL
Montgrí (Girona)
and supply
Catalunya SL
Summit Energy
Wilmington
USA
2,050,000.00
USD
Electricity generation
Line-by-line
Enel Green
75.00% 51.22%
Storage Inc.
(Delaware)
from renewable
resources
Power North
America Inc.
Sun River LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Sweetwater
Concord (New
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Hydroelectric LLC
Hampshire)
from renewable
resources
Power North
America Inc.
Taranto Solar Srl
Rome
Italy
100,000.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power SpA
Tecnatom SA
Madrid
Spain
4,025,700.00
EUR
Electricity generation
Equity
Endesa
45.00% 31.55%
and services
Generación SA
Tecnoguat SA
Guatemala
Guatemala
30,948,000.00
GTQ
Electricity generation
Line-by-line
Enel Green
75.00% 51.22%
from renewable
resources
Power
International BV
Tejo Energia Produção
Paço de Arcos
Portugal
5,025,000.00
EUR
Electricity generation,
Equity
Endesa
38.89% 27.26%
e Distribuição de
(Oeiras)
Energia Eléctrica SA
transmission and
distribution
Generación SA
Teploprogress OJSC
Sredneuralsk
Russian
128,000,000.00
RUB
Electricity sale
Line-by-line
OGK-5 Finance
60.00% 33.86%
Federation
LLC
Termoeléctrica José
Buenos Aires
Argentina
500,000.00
ARS
Construction and
Equity
Central Dock
5.32%
7.29%
de San Martín SA
management of a
combined-cycle plant
Sud SA
Endesa Costanera
5.51%
SA
Hidroeléctrica El
18.85%
Chocón SA
Termoeléctrica Manuel
Buenos Aires
Argentina
500,000.00
ARS
Construction and
Equity
Hidroeléctrica El
18.85%
7.29%
Belgrano SA
management of a
combined-cycle plant
Chocón SA
Central Dock
5.32%
Sud SA
Endesa Costanera
5.51%
SA
Termotec Energía AIE
Valencia
Spain
481,000.00
EUR
Cogeneration of
-
Enel Green
45.00% 31.06%
(in liquidation)
electricity and heat
Power España SL
TERRAE Iniziative
Rome
Italy
19,060,811.37
EUR
Agro-industrial
Equity
Enel Green
20.00% 13.66%
per lo sviluppo
agroindustriale SpA
activities
Power SpA
Texkan Wind LLC
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Texkan Inc. 100.00% 68.29%
(Delaware)
from renewable
resources
Tko Power LLC
Los Angeles
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
(California)
from renewable
resources
Hydro Holdings
LLC
Tobivox (RF) (Pty) Ltd Houghton
South Africa
10,000,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
60.00% 40.97%
from renewable
resources
Power RSA (Pty)
Ltd
Toledo Pv AEIE
Madrid
Spain
26,890.00
EUR
Photovoltaic plants
Equity
Enel Green
33.33% 23.00%
Power España SL
Tradewind Energy Inc. Wilmington
USA
200,000.00
USD
Electricity generation
Equity
Enel Kansas LLC 19.90% 13.59%
(Delaware)
from renewable
resources
Transmisora de Energía
Guatemala
Guatemala
233,561,800.00
GTQ
Electricity generation
Line-by-line
Enel Green
0.00%
68.29%
Renovable SA
432
from renewable
resources
Power Guatemala
SA
Enel Green
100.00%
Power
International BV
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Transmisora Eléctrica
Santiago
Chile
440,644,600.00
CLP
Electricity transmission
Equity
Compañía
50.00% 18.64%
de Quillota Ltda
and distribution
Eléctrica Tarapacá
SA
Transportadora de
Buenos Aires
Argentina
100,000.00
ARS
Electricity generation,
Line-by-line
Compañía de
100.00% 51.15%
Energía SA
Transportes y
Distribuciones
Eléctricas SA
Olot (Girona)
Spain
72,120.00
EUR
Electricity
Line-by-line
Endesa
73.33% 51.41%
transmission
Distribución
Eléctrica SL
transmission and
distribution
Interconexión
Energética SA
Triton Power Company New York
USA
-
USD
Electricity generation
Line-by-line
Highfalls Hydro
98.00%
68.29%
(New York)
from renewable
resources
Company Inc.
Enel Green
2.00%
Power North
America Inc.
Tsar Nicholas LLC
Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Twin Falls Hydro
Seattle
USA
-
USD
Electricity generation
Line-by-line
Twin Falls Hydro
99.51% 34.66%
Associates
(Washington)
from renewable
resources
Company LLC
Twin Falls Hydro
Wilmington
USA
-
USD
Electricity generation
Line-by-line
EGPNA REP
100.00% 34.83%
Company LLC
(Delaware)
from renewable
resources
Hydro Holdings
LLC
Twin Lake Hills LLC Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
Twin Saranac Holdings
Wilmington
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
LLC
(Delaware)
from renewable
resources
Power North
America Inc.
Ufefys SL
(in liquidation)
Aranjuez
Spain
304,150.00
EUR
Electricity generation
-
Enel Green
40.00% 27.61%
from renewable
resources
Power España SL
Ukuqala Solar (Pty) Ltd Johannesburg South Africa
1,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power RSA (Pty)
Ltd
Ultor Srl
Rome
Italy
5,100,000.00
Unión Eléctrica de
Las Palmas de
Spain
190,171,520.00
EUR
EUR
Electricity generation
Equity
Marte Srl
50.00% 34.14%
Electricity generation
Line-by-line
Endesa
100.00% 70.10%
Canarias Generación
Gran Canaria
SAU
Generación SA
Upington Solar
Johannesburg South Africa
1,000.00
ZAR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
(Pty) Ltd
from renewable
resources
Power RSA (Pty)
Ltd
Ustav Jaderného
Rez
Czech Republic 524,139,000.00
CZK
Nuclear power research
Equity
Slovenské
27.77% 18.33%
Výzkumu Rez AS
and development
elektrárne AS
Vektör Enerji Üretim
Istanbul
Turkey
740,000.00
TRY
Plant construction and
Line-by-line
Enel Green
100.00% 68.29%
Anonim S¸irketi
electricity generation
from renewable
resources
Power
International BV
Vientos del Altiplano S
Mexico City
Mexico
813,702,087.00
MXN
Electricity generation
Line-by-line
Enel Green
99.99%
68.29%
de RL de Cv
from renewable
resources
Power México S
de RL de Cv
Viruleiros SL
Santiago de
Spain
160,000.00
EUR
Electricity generation
Equity
Enel Green
67.00% 46.24%
Compostela
from renewable
resources
Power España SL
Walden LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power North
America Inc.
Waseca Solar LLC
Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora
100.00% 68.29%
from renewable
resources
Distributed Solar
LLC
Hidroelectricidad
0.01%
del Pacífico S de
RL de Cv
433
AttachmentsAnnual Report 2015 Company name
Headquarters Country
West Faribault Solar
Delaware
USA
LLC
Share
capital
-
Currency Activity
Consolidaton
method
USD
Electricity generation
Line-by-line
from renewable
resources
%
Group %
holding
holding
100.00% 68.29%
Held by
Aurora
Distributed Solar
LLC
West Hopkinton Hydro
Delaware
USA
-
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
LLC
from renewable
resources
Power North
America Inc.
West Waconia Solar
Delaware
USA
-
USD
Electricity generation
Line-by-line
Aurora
100.00% 68.29%
LLC
from renewable
resources
Distributed Solar
LLC
Western New York
Albany
USA
300.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Wind Corporation
(New York)
from renewable
resources
Power North
America Inc.
Willimantic Power
Hartford
USA
1,000.00
USD
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Corporation
(Connecticut)
from renewable
resources
Power North
America Inc.
Wind Park of Koryfao
Maroussi
Greece
60,000.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
SA
from renewable
resources
Power Hellas SA
Wind Parks Anatolis-
Maroussi
Greece
1,158,188.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
Prinias SA
from renewable
resources
Power Hellas SA
Wind Parks of Bolibas
Maroussi
Greece
551,500.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
SA
from renewable
resources
Power Hellas SA
Wind Parks of
Maroussi
Greece
556,500.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
Distomos SA
from renewable
resources
Power Hellas SA
Wind Parks of Folia SA Maroussi
Greece
424,000.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
from renewable
resources
Power Hellas SA
Wind Parks of Gagari
Maroussi
Greece
389,000.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
SA
from renewable
resources
Power Hellas SA
Wind Parks of Goraki
Maroussi
Greece
551,500.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
SA
from renewable
resources
Power Hellas SA
Wind Parks of Gourles
Maroussi
Greece
555,000.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
SA
from renewable
resources
Power Hellas SA
Wind Parks of Kafoutsi
Maroussi
Greece
551,500.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
SA
from renewable
resources
Power Hellas SA
Wind Parks of Katharas
Maroussi
Greece
538,648.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
SA
from renewable
resources
Power Hellas SA
Wind Parks of Kerasias
Maroussi
Greece
475,990.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
SA
from renewable
resources
Power Hellas SA
Wind Parks of Milias
Maroussi
Greece
614,774.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
SA
from renewable
resources
Power Hellas SA
Wind Parks of Mitikas
Maroussi
Greece
442,639.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
SA
Wind Parks of
Paliopirgos SA
Maroussi
Greece
200,000.00
EUR
Electricity generation
Line-by-line
Enel Green
80.00% 54.63%
from renewable
resources
Power Hellas SA
from renewable
resources
Power Hellas SA
Wind Parks of
Maroussi
Greece
575,000.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
Petalo SA
Wind Parks of
Platanos SA
Maroussi
Greece
425,467.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
from renewable
resources
Power Hellas SA
from renewable
resources
Power Hellas SA
Wind Parks of
Maroussi
Greece
472,000.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
Skoubi SA
434
from renewable
resources
Power Hellas SA
Annual Report 2015 Company name
Headquarters Country
Share
capital
Currency Activity
method
Held by
holding
holding
Consolidaton
%
Group %
Wind Parks of Spilias
Maroussi
Greece
547,490.00
EUR
Electricity generation
Line-by-line
Enel Green
100.00% 68.29%
SA
Wind Parks of
Strouboulas SA
Maroussi
Greece
576,500.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
from renewable
resources
Power Hellas SA
from renewable
resources
Power Hellas SA
Wind Parks of Trikorfo
Maroussi
Greece
260,000.00
EUR
Electricity generation
Equity
Enel Green
29.25% 19.97%
SA
from renewable
resources
Power Hellas SA
Wind Parks of Vitalio
Maroussi
Greece
361,000.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
SA
from renewable
resources
Power Hellas SA
Wind Parks of Vourlas
Maroussi
Greece
554,000.00
EUR
Electricity generation
Equity
Enel Green
30.00% 20.49%
SA
from renewable
resources
Power Hellas SA
Winter’s Spawn LLC Minneapolis
USA
-
USD
Electricity generation
Line-by-line
Chi Minnesota
51.00% 34.83%
(Minnesota)
from renewable
resources
Wind LLC
WP Bulgaria 1
Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
EOOD
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 10 EOOD Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 11 EOOD Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 12 EOOD Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 13 EOOD Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 14 EOOD Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 15 EOOD Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 19 EOOD Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 21 EOOD Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 26 EOOD Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 3
Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
EOOD
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 6
Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
EOOD
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 8
Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
EOOD
operation and
maintenance
Power Bulgaria
EAD
WP Bulgaria 9 EOOD Sofia
Bulgaria
5,000.00
BGN
Plant construction,
Line-by-line
Enel Green
100.00% 68.29%
operation and
maintenance
Power Bulgaria
EAD
Yacylec SA
Buenos Aires
Argentina
20,000,000.00
Yedesa-Cogeneración
Almería
Spain
234,000.00
ARS
EUR
SA (in liquidation)
Electricity transmission Equity
Enersis SA
22.22% 13.47%
Cogeneration of
-
Enel Green
40.00% 27.61%
electricity and heat
Power España SL
435
AttachmentsAnnual Report 2015 Corporate governance
436
Annual Report 2015 437
Corporate governanceAnnual Report 2015 Report on Corporate Governance
and Ownership Structure
The corporate governance structure of Enel SpA complies with
the adequacy of the organizational structure, the internal
the principles set forth in the edition of the Corporate Governan-
control system and the administrative-accounting system
ce Code for listed companies(1) most recently amended in July
of the Company; (iii) the statutory auditing of the annual
2015, which has been adopted by the Company. Furthermore,
accounts and the consolidated accounts, as well as the
the aforementioned corporate governance structure is inspired
independence of the statutory audit firm; and (iv) the man-
by CONSOB’s recommendations on this matter and, more gene-
ner in which the corporate governance rules set out in the
rally, international best practice.
Corporate Governance Code are actually implemented;
The corporate governance system adopted by Enel and the
> a Shareholders’ Meeting, which is competent to take de-
Group is essentially aimed at creating value for the shareholders
cisions concerning, among other issues – in ordinary or
over the medium-long term, taking into account the social impor-
extraordinary session: (i) the appointment and termination
tance of the Group’s business operations and the consequent
of members of the Board of Directors and the Board of
need, in conducting such operations, to adequately consider all
Auditors and their compensation and responsibilities; (ii)
the interests involved.
the approval of the financial statements and allocation of
In compliance with the provisions of Italian law governing compa-
net income; (iii) the purchase and sale of treasury shares;
nies with listed shares, the Company’s organization is characte-
(iv) stock-based compensation plans; (v) amendments of
rized by:
the bylaws; and (vi) the issue of convertible bonds.
> a Board of Directors charged with managing the Company;
The statutory auditing of the accounts is performed by a specia-
> a Board of Auditors charged with monitoring: (i) complian-
lized firm entered in the appropriate official register. It was en-
ce with the law and the bylaws, and with the principles
gaged by the Shareholders’ Meeting on the basis of a reasoned
of sound administration in the performance of company
proposal of the Board of Auditors.
business; (ii) the financial reporting process, as well as
Patrizia Grieco (P 3)
Francesco Starace (CEO/GM)
Alfredo Antoniozzi (3,4)
Alessandro Banchi(2,4)
Alberto Bianchi (3,4)
Paola Girdinio (1,2)
Alberto Pera (1,2)
Anna Chiara Svelto (1,2)
Angelo Taraborrelli (1,4)
Shareholders’
Meeting
Independent
auditors
Ernst & Young
Board of
Directors
Board of
Auditors
Sergio Duca (P)
Lidia D’Alessio
Gennaro Mariconda
Control & Risk
Committee1
Nomination &
Compensation
Committee2
Corporate
Governance
Committee3
Related Parties
Committee4
For more detailed information on the corporate governance system, please see the Report on Corporate Governance and Ow-
nership Structure of Enel, which has been published on the Company’s website (www.enel.com, in the “Governance” section).
(1) The current edition of the Code is available on the website of Borsa Italiana (http://www.borsaitaliana.it/borsaitaliana/regolamenti/corporategovernance/corpora-
tegovernance.en.htm).
438
Annual Report 2015 439
Corporate governanceAnnual Report 2015 Concept design
Newton 21 Rome
Publishing service
Newton 21 Rome
Copy editing
postScriptum - Rome
Printing
Primaprint - Viterbo
20 copies printed
Printed in June 2016
INTERNAL PAGES
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COVER
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This publication is printed on FSC® certified paper
Publication not for sale
Edited by
Communications Italy
Disclaimer
This Report issued in Italian
has been translated into
English solely for the convenience
of international readers
Enel
Società per azioni
Registered Office
137 Viale Regina Margherita, Rome
Share capital €10,166,679,946 fully paid-up
Tax I.D. and Companies Register
of Rome: no. 00811720580
R.E.A. of Rome no. 756032
VAT Code no. 00934061003
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enel.com