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Electricity Distribution

The year 2010 is the third year within the third period of tariff regulation for transmission, distribution, and measurement of electricity. The tariff framework is based on the definition of tariffs set out by the AEEG on a national basis, differentiated by user type, and on the existence of suitable general equalization mechanisms, established to adjust the invoicing revenue depending on the operating and capitalised costs of each operator.

All reference tariff provisions are identified by the Consolidated Act on the provisions for the supply of transmission, distribution, metering and sales services (TIT), approved by AEEG by resolution no. 348/07 of December 2007, while the specific tariff levels for the reference tariffs for 2010 were defined by resolution arg/elt 203/09 of December 2009.

In addition, in 2010, AEEG approved the amounts of certain significant revenue and cost equalisation components provided under the TIT with reference to 2008. Specifically, it refers to approval of the revenue equalisation amounts of the low voltage metering service (resolution arg/elt no. 40/10) and equalisation of the commercial costs of the low voltage customer distributors (resolution arg/elt no. 227/10). Even though these approvals refer to previous years, they are the first formal definitions by AEEG for the current regulatory period, for the associated equalisation items. Finally, we note approval, by the Equalisation fund for the Electricity Sector, of the equalisation amount of the value of the difference between actual and standard network losses provided for distributors under the Consolidated Act on Sales (TIV), pursuant to resolution 156/07.

Against this backdrop, revenues from tariffs for transmission, distribution, and measurement of electricity for 2010 were equal to Euro 52.0 million, with 2,238 million kWh distributed and an average revenue per unit equal to Euro 2.32 cents / kWh.

Compared to 2009, an equally significant increase in revenues of 7.6% was recorded, (from Euro 48.3 million to 52.0 million) against a significant increase in the delivered volumes (up 5.7% from 2,117 million to 2,238 million kWh).

Electricity distribution, metering and transmission - regulated revenues 2009 2010% Change
Hera consolidated
Revenues (millions of )48,3052,007,60%
Volumes (millions of cubic metre) 2.117,00 2.238,005,70%
Average revenue per unit (cent per cubic metre)2,282,321,80%

In order to give a more detailed account of the Euro 3.7 million increase in revenues, we should first analyse the development of the permitted revenues generated by the reference tariffs with respect to the 2009 and 2010 levels, that show an increase of approximately Euro 4.5 million due to the double effect of an increase in the distributed volumes noted above, and the increase in the reference tariffs approved by AEEG by resolution arg/elt no. 203/09 (average increase of about +4%). The increase in permitted revenues was however offset, by Euro -0.9 million by various effects mainly to do with a change in the components provided for tariff equalisation between 2009 and 2010, and the revision of past year amounts, with reference to both the amounts invoiced to the sellers and the equalisation amounts.