Keizerslaan 20 Boulevard de l'Empereur, 20 B-1000 Brussels
Tel.: 02 546 70 11 Fax: 02 546 70 10
12 November 2010 Interim statement Q3 2010
Elia confirms financial forecasts for 2010.
50Hertz incorporated into the Elia Group in line with plans.
Successful issue by Eurogrid GmbH of a ten-year Eurobond worth €500 million.
Consolidation of energy exchanges: APX and Belpex join forces; Elia achieves surplus of €9.6 million (60% allocated to shareholders).
Further progress made in creating an integrated European electricity market and building up an offshore electricity network: extension of market coupling is a success.
Financial forecasts As reported in the 2010 half-yearly results, Elia is unable to give any concrete profit forecasts since the Group's annual result are dependent upon parameters that will either not be known until almost the end of 2010 (such as inflation figures for December 2010) or else can only be calculated at that time (e.g. average Belgian ten-year rate, the beta of Elia shares, total investment from Eurogrid/50Hertz). However, Elia can confirm its plan to keep its dividend at at least the present level throughout 2010. Investment and large-scale maintenance works for 2010 are on schedule to be completed as planned despite several industrial customer-connection projects having been postponed. The budget of €117 million for 2010 is allocated as follows: 45% to finance renewal work, 30% to provide the investment required as a result of rising domestic demand, 12% to fund connection of renewable energy sources and new facilities, 5% to upgrade interconnections and the remaining 8% to bolster other investments (not linked to the grid). Since Elia's activities are regulated, the Group is well positioned to withstand the current economic crisis and is not susceptible to fluctuations in the volume of electricity transmitted. 50Hertz incorporated into the Elia Group as planned Although 50Hertz is considered and financed as a separate entity within the Elia Group, important progress has been made as regards cooperation between 50Hertz and Elia. Between the acquisition on 19 May 2010 and the end of the year, some ten working groups (regulation, market mechanisms, procurement, IT, finance, risk-management, HR, communications, etc.) comprising teams from both TSOs will have joined forces to create synergies in terms of operations and compile best practices drawing on experience within both companies. By early November, many of the goals had already been achieved, which means a positive outlook for the future integrated European electricity market, as well as for tariffs and shareholders. Market coupling developed further: successful launch of its extension to 9 countries One of the tasks of the transmission system operator is to ensure that transmission capacity is available between electricity exchanges in Member States to promote integration of wholesale electricity markets. The electricity exchanges in France, the Netherlands and Belgium have been coupled in this way since November 2006 and such coupling has resulted in significant convergence in wholesale prices in all three countries. On 9 November 2010, market coupling was successfully expanded to the so-called Central West Europe (CWE) Region comprising the Benelux area, Germany and France with a single market price for every hour of 10 November in these 5 countries. Since the German electricity exchange is already coupled with its counterparts in Scandinavia (Denmark, Finland, Norway and Sweden) this initiative entails coupling the electricity markets in all nine countries. This will promote greater transparency and a more streamlined
system of price formulation on the wholesale market covering an area which accounts for approximately 60% of consumption in the European Union. The initiative will also enable the market to take advantage of the complementary nature of generation facilities in these regions, for example the large proportion of thermal power stations in the CWE Region and flexible hydropower facilities in northern Europe. It will also make it possible to incorporate more variable generation capacity from wind and solar power sources without causing major market imbalances.
Eurogrid GmbH successfully issues a ten-year Eurobond worth €500 million Eurogrid GmbH (parent company of 50Hertz Transmission) has successfully issued an initial €500 million tranche of a Eurobond programme worth a total of €2.5 billion. The funds yielded will be used to repay short-term bank loans and to channel investment into Berlin-based 50Hertz over the coming years. This is the first time that a German transmission system operator has effected such a transaction. Registration of the first instalment sparked considerable interest among 200 investors from 25 countries. The ten-year mid-swap price of the first instalment was €2.66 plus 127 basis points (giving a return of 3.93%). The Eurobond is listed on the Luxembourg Stock Exchange and has a Baa1 rating; its outlook is rated as stable by Moody’s. Connection of the second offshore wind farm in the Baltic Sea 50Hertz Offshore has concluded an agreement with General Cable Group concerning the manufacture and installation of the 120-km undersea cable to connect the Baltic 2 wind farm (capacity of 288 MW) with the high-voltage grid from 2012. Baltic 2 is located in the Baltic Sea off the coast of Germany's largest island, Rügen. The wind farm will generate 1,200 GWh of electricity annually and in doing so will cut CO2 emissions by 900,000 tonnes. Elia and TenneT press ahead in consolidating energy exchanges: Belpex now integrated into APX-ENDEX In April, Elia and TenneT announced their joint intention to bring their respective 60% and 10% stakes in the Belgian energy exchange Belpex, into APX-ENDEX, which currently coordinates the short-term electricity market in the Netherlands and Great-Britain. Elia generated a surplus of €9.6 million on this transaction, of which 60% will be allocated to shareholders and 40% to tariffs. The transaction perfectly fits within the European strategy of both transmission system operators and dovetails with APX-ENDEX's goal of further enhancing the European electricity market. Elia has acquired a 20% stake in APX-ENDEX and will also be involved in the latter's managerial bodies. The transaction was concluded successfully following approval by the European authorities. APX-ENDEX is now owned jointly by Elia (20%), Fluxys (3%), Gasunie (21%) and Tennet (56%). The transaction marks a crucial step towards integrating the energy exchanges in the northwest European market and, in a broader European context, builds on the efforts made by APX-ENDEX and Belpex since their inception. Within the new structure, Belpex will be assigned its own fields, namely activities on the Belgian-Dutch market and the market in green electricity certificates. Following this transaction, prices on the (spot) market for electricity on all markets will be determined in an efficient and coordinated manner while cross-border exchanges will be optimised, thereby benefiting Belgian and European consumers.
Financial calendar Publication of 2010 annual results Annual report available 2010 General Meeting of Shareholders Payment of dividend for 2010 Interim information for Q1 of 2011
25 February 2011 Early April 2011 10 May 2011 May 2011 Mid-May 2011
About Elia Elia is the Belgian transmission system operator, transmitting electricity efficiently, reliably and securely from producers to distribution system operators and major industrial users. Elia is responsible for importing and exporting electricity from and to neighbouring countries. Elia owns the entire Belgian very high voltage grid (150 to 380 kV) and some 94% (ownership and user rights) of the Belgian high-voltage grid (30 to 70 kV). The Elia grid comprises 5,614 km of overhead lines and 2,765 km of underground connections and is a key link between electricity markets in northern and southern Europe. It also links Belgian producers and consumers. Belgium's recent investment in interconnection capacity with its neighbours makes it one of the most open and interconnected grids in Europe. Elia has recently expanded its activities on a broader European level and, following its acquisition of the German TSO 50Hertz and in cooperation with Industry Funds Management (IFM), is now one of the top five transmission system operators in Europe. For further information, please contact Elia: Media: Eva Suls Lise Mulpas
+32 2 546 73 78 +32 2 546 73 75
+32 477 48 80 09 +32 478 65 28 90
Investor relations: Bert Maes
+32 2 546 72 39
+32 472 40 69 97
Website: This press release is also available at www.elia.be