Enel Roadmap toward Excellence in Grid Management Trends in Power Industry in the European Context VIII Antonello Buondonno Head of Europe and Americas Business Development Infrastructure and Network Division Spindleruv Mlyn, April 18th ,2013 1

Enel: an international energy operator Italian Core. European Base Enel: an international energy operator Italian Core. European Base. Global Strategy* 40 countries 61 mln connection points Listed on: Milano SE (1,5 mln Shareholders) EBITDA: 17,7 bln € Installed capacity: 97,3 GW Annual output: 290 TWh Energy distributed: 430 TWh UP-Stream Gas: 984 MMboe* Reserves 680 MMboe** Resources Employees: 75.300 (< 50% in Italy) < 500 MW < 1.000 MW < 2.000 MW < 10.000 MW > 10.000 MW Representative offices, financial holdings, operative branches, commercial companies NG Prospective Resources NG Reserves 1st utility in Italy, one of the largest in Europe by installed capacity. Present throughout the entire electricity and natural gas value chain * year-end 2011 **MMboe: Million Barrels of Oil Equivalent

Enel Networks in the world Áreas of presence 1,8 mln km línes/ cables 430 TWh Energy Distributed 61 mln Point of delivery Uso: inserire classificazione ROMENIA 2nd Distribuitor (30%) 2,6 Mln P.o.D. COLOMBIA 2nd Distribuidor (24%) 2,3 Mln P.o.D. BRASIL 5,5 Mln P.o.D. PERU 2nd Distributor (23%) 1,1 Mln P.o.D. CHILE !st Distributoor(32%) 1,5 Mln P.o.D. SPAIN 1st Distributor (35%) 13 Mln P.o.D. ITALY First Distribuitor (80%) 31,5 Mln P.o.D. ARGENTINA 2nd Distributor(16%) 2,3 Mln P.o.D.

Agenda Italian market context and Smart Meter Regulation The roadmap to smart networks and operational excellence Envisaging the future Infrastructure

Italian Regulatory framework Regulatory context Enel Distribuzione Focus on core business 1999 Smart Meter start-up Bundled Distribution & Sales organization Enel starts deployment before liberalization and unbundling based on financial return/ operational benefits evaluation 1999-2007 Progressive liberalization of the electricity sector Unbundling of Distribution and Sales DSO keeps responsibility for Metering & Reading activities Enel anticipates the changes and reengineers its internal processes to cope with new challenges in efficiency, quality of service, customer relations etc. In 2006-07 Regulator adopts new metering rules confirming approach on Smart Meters with mandatory installation within 2011 for all electricity customers ToU for all customers within 09/2012 Enel completed in 2006 the installation of approx. 31M smart meters. 2007-2011 Smart Meter Massive deployment In 2006, the Italian 5 5

Italian Regulatory framework - Impact of smart meter on regulated metering activities Uso: aziendale Real consumption billing Mandatory for all customers Set at min. 95% for readings -85% contractual load limit for 10 days, "real time" reconnection Allowance of +20% load limit Recording of customer's interruptions and voltage variation Improved Trader-Customer relation/ leverage to promote competition and spreading of market efficiency New readings rules Time of use tariffs Readings target success rate New rules for bad payers management and reconnection Load management Better management and monitoring of quality of service Increase in market competition

Market Dynamics – Enel Distribuzione in Italy Distributed Renewables (GW) Free Market customers (Mln) PV 13 370.000 Prosumers connected Connections (2012): 4000 LV request /week (max level reached) 0.5MW/AVG request MV (min.) Smart Metering (2011): 403 Mil remote readings Commercial Quality 99.75% (AEEG) 9.4 Mil remote work orders Approx. 250.000 Switch/month Connections(GW) 4,3 3,7 3,6 a2010 a2011 b2012

Italian Regulatory framework - Time of use tariffs for everyone Uso: aziendale Italian Regulatory framework - Time of use tariffs for everyone July 2010: “Italian households bill is based on two-tier prices, with a saving of 450 thousand tonnes CO2 and 80 mln€ fuel by shifting 10% of consumption to more favourable hours. Consumers save 200 mln€/yr” Smart meters support energy saving Source: press Release AEEG

Agenda Italian market context and Smart Meter Regulation The roadmap to smart networks and operational excellence Envisaging the future Infrastructure

Enel Distribuzione roadmap Heading towards efficiency Process reengineering Automatic Meter Solutions in Europe 41 m. meters in Europe 97% daily success rate of the operations in Enels grid (2012) Smart Grid/Network Automation 2.100 HV/MV substations remotely controlled (100%) 115.000 MV/LV substations remotely controlled (80% of customers) with automatic fault clearing procedures Asset Management in Italy Satellite mapping of network assets Database of network events (outage, fault detection ….) Optimization of network investments based on a risk analysis Work Force Management 6.100 Enel teams connected +GPS localization ENEL cartographic on board Mobile applications for all Field Operations Smart Meter and process optimization are the cornerstone to deliver value to stakeholders and partners

Enel Distribuzione roadmap Impact of Technology deployments: toward a new paradigm in network management Process reengineering 80 €/ customer 52 €/ customer OPEX per client CAPEX per client SAIDI (minutes per client ) Opex reduction: - 40 % Quality of service: +67 %

Enel Distribuzione roadmap Benefits for the customers: Reduction of tariff network component components + 60% Eurocent/ kWh 16,18 14,8 + 93% 4,22 3,39 10,12 Taxes system charges 2,19 + 95% 8,92 9,47 Generation and supply * 4,84 - 19 % Grids 3,09 2,49 2,49 1999 2006 2011 Net benefit to consumer

Enel Smart Meter experience Uso: Uso: pubblico pubblico World wide most advanced and field proven project 34 M Smart Meter installed in Italy on Enel LV network 5 M smart Meters installed on other DSOs networks, in Italy and abroad A new, state-of-the-art solution (meter, concentrator, AMM system modules) developed lately, maintaining ENEL traditional robustness, reliability and cost effectiveness 13 M Smart Meter now under deployement in Spain, 3 M already installed , the largest and fastest project in Spain

2G/ 3G public TLC infrastructure Smart Meter Enel Smart Metering Simplified Architecture PLC LV lines Head-End System MV/ LV substation AMI Control Center 2G/ 3G public TLC infrastructure

Enel Smart Metering Interoperability and openness International non-profit association to maintain and support the open communication protocol for Smart Metering solutions Board of Directors from Enel, Endesa, ST, CESI, Siemens; Up to May 15th 2012: 30 members among world leading companies and institutions, from different business sectors, have already joined the Association 2010 2011 2012 Founding Members

Smart Metering Economics Key success factors Continuous innovation FAST implementation of improvements Crossover technologies PLC for SM + G2/G3 for DC International standards open technologies & solutions International manufacturing Outsourcing of manufacturing/OEMs + Enel onsite teams to ensure quality & costs Speed of implementation 20-25% yearly substitution rate (Project completion in 4-5 years) Massive roll out all LV meters installed in parallel & uniform lots to anticipate savings Value creation

Smart Meter Project Cost Benefit Analysis Project’s key indicators Uso: pubblico Italy 2001 Spain 2010 Number of Meters installed 33 Mln Monophase 90% Poliphase 10 target: ~100% customer coverage with full feature/ remotely managed meters Roll-out 5 Years Cumulated CAPEX* 2,1 Bln € Yearly Running Costs ** 67,3 Mln € Yearly Savings ** 450 Mln € Meter Average Life 15 years 13 Mln 85% 15 5 Years 1,6 Bln € 15 years PBP 5 years

Remote re-arm from customer main switch Smart Meter Network Operation and Customer Management in Smart Metering world full remote management Concentrator Remote Connection and reconnection Customer Main Switch LV network Remote change of Price/ tariff structure (Tou), pre.paid, contractual load limit Remote SW/ FW download - Customer LV grid - Remote re-arm from customer main switch 18

Contractual load limit management Smart Meter Network Operation and Customer Management in Smart Metering world Credit Management, Peak Shaving Programmable / flexible load limiting: Flexible contractual power limit changes from remote(*), key to for load flow/ peak management "Smart" load shedding Credit Management: load curtailment instead of outright cut-offs; i.e.: Power limitation ensures minimum social supply (usually 10% of contractual load, programmable value) for 1 month Remote Power restoration soon after payment Power Allowed 10kW 6KW 3KW -90% Contractual load limit management Bad Payers management * The Meter can simulates the behaviour of a traditional switch in disconnection of power higher than maximum contractual load

Smart Meter Use: Public Network Operation and Customer Management in Smart Metering world Tariff/ contract flexibility ITALIAN REGULATOR (AEEG) STATEMENT July 2010 press release July 2010: “Italian households bill is based on two-tier prices, with a saving of 450 thousand tonnes CO2 and 80 mln€ fuel by shifting 10% of consumption to more favourable hours. Consumers save 200 mln€/yr” Smart Metering enable multi tariff contracts with near real time operations and changes multi-tariff structure allows for flexible tariff management; e.i.: 6 different tariffs (with programmable maximum subscribed demands) 8 different daily periods [00.00 ÷ 24.00] with 15 min granularity 8 different type of days (from Monday to Sunday + Public Holidays) 3 different weekly structures 8 different annual periods Activation of tariffs is made according to a real- time calendar Smart meters support energy saving Source: press Release AEEG

Network Operation and Customer Management in Smart Metering world Frauds detection tools: LV energy balance for each TR Remote measurement of energy supplied by every MV/LV transformer through a LV “balance smart meter” Syncronized remote readings of the energy measured by the customers’ smart meters Global LV energy losses estimation (difference between TR measured energy and total customers measured energy) Georeferencing and mapping of the TR energy losses distribution (area is proportional to the TR power) AMM TR Balance smart meter (GET4S-GISS) BTS GSM CBT/LVC Customers smart meters

Enel Experience in Network Remote Control and Automation Smart Grid Enel Experience in Network Remote Control and Automation 28 Control centers (Italy) 100% Remotely controlled HV-MV substations 32+% Remotely controlled MV-LV substations 100% Automated MV feeders ( Self healing network, reliability, security of supply

Enel Remote Control and Automation Overall Architecture Smart Grid MT BT AT HV/MV Subs (TPT / TPT 2000) TSO STUX / STM MV/LV Subs (UP-RTU) The ENEL System for Grid Automation and Remote Control can be divided into 3 main Macro-blocks: Central systems (STU-X/STM); Remote Terminal Units (TPT2000 + UP + RGDAT) Telecommunication systems (Data network); Ensures secure communication and data feeding corporate systems Corporate systems / Intranet

Remote Control and Automation System Smart Grid Remote Control and Automation System Remote Terminal Unit (RTU) for Primary (HV/MV) Substations TPT2000: Current Enel Standardized Primary Substation RTU Digital channels, IP networks Always on connected to the center Collect, aggregate and make available to the center data from the Primary Substation: Alarms Measurements Signals

Remote Control and Automation System Smart Grid Remote Control and Automation System Remote Terminal Unit: UP Enel Standard for MV/LV Substations UP provides remote commands, local automation, alarms, measure … Enel Standard component UP is available for both indoor and outdoor use, and in two versions, capable to manage up to: 8 Switches 16 Switches For indoor applications Manage both MV and LV motorized switches For pole top applications Pole mounted ManageSF6 insulated switches

Remote Control and Automation System Smart Grid Remote Control and Automation System MV Automation: RGDAT, ENEL Standard Fault Detectors Composed by current & voltage sensors + electronic unit connected to RTU in substation Ensures Detection of short circuits Non directional 500A Detection of ground faults Directional detector (the direction can be set from remote) High sensitivity (up to 6kOhm in compensated neutral situations Full operation in compensated and isolated neutral condition MV input voltage detector

Remote Control and Automation System Smart Grid Remote Control and Automation System MV Automation – Fault Detectors for indoor applications Current sensors A RG-DAT for indoor application is composed by: Current sensors Toroidal transformers installed around the MV cable inputs Voltage sensors Voltage is taken from capacitive dividers installed inside the MV board by means of special sockets, located in front of the MV switch Electronic unit Connected to the RTU in the substation. Voltage input socket Electronic unit

Remote Control and Automation System Smart Grid Remote Control and Automation System MV Automation: RGDAT OUTDOOR Enel standard Fault Detectors for outdoor installation RGDAT Outdoor Voltage and current sensors Allows automation of pole top switches installed on overhead networks (mainly rural): detection and isolation of faulty branch

Remote Control and Automation System Smart Grid Remote Control and Automation System MV/LV Substation Automation rules – block diagram Modular MV Switchboard Line Module TR UP AS LV Board Batteries 24V + Charger Connectors Electronics 230 Vca E Vo Iomo I4 I12 2G/3G Modem RGDAT MV cables Cables for remote control power signals/measures control

Remote Control and Automation System Smart Grid Remote Control and Automation System In the remote controlled secondary substations the Remote Terminal Unit (UP) is able to open and close the switches according to a specific set of rules thanks to the indications coming from the fault detectors. If you enable these rules, in case of a fault on the feeder, the switches are automatically opened and closed by the UP according to these rules so as to isolate the faulty feeder section. With the help of the recloser installed at the MV line departure in the feeding Primary Substation, the healthy feeder sections located upstream the faulty ones are resupplied. At the end of these sequence of operations the UP sends a spontaneous call to the control centre to alarm the operator on the events and to let him resupply the sections located downstream the faulty one. It is important to highlight that this function is performed by the UPs on the feeder and by the recloser in the HV/MV substation without any intervention of control center; therefore it works also in case of faults in Central system or in telecommunication systems. MV Automation - Summary

Remote Control and automation system – ST Web Applications Smart Meter/ Grid ST Web Applications Remote Control and automation system – ST Web Applications Network Metering Other Company applications ST Web Applications STUX/STM ST Remote Control and Automation System

Enel EMM Electric Mobility Management www.enelmobility.it Smart Grid Enel EMM Electric Mobility Management EMM Remote management main features Remote management Activation, Configuration Localization Trouble Management Multi DSO, with Roaming service Customer centric Management of individual Customer Contracts, prepaid Grid integration Flexibility of charging according to energy availability (distributed generation). Storage of eventual energy overproduction. Voltage control assuring the quality of service. www.enelmobility.it

Smart Grid Electric Vehicle recharging infrastructure eMobility Italy – Charging stations design and certification Key Features Metering grade measurement of energy usage System access with RFID ID card Security Flexible communication: 3G and PLC enabled Identification and authorization to charge from Clearing House Customizable energy supply: mono vendor vs multiple supplier Prepaid Process control: Recharge remote control Remote monitoring of recharging station; availability check Hom e Publi c All solutions equipped with smart-metering, ready for integration into the upcoming smart grid.

High Efficiency in Work Force Management WFM Teams equipped with PC + Android Smartphone connected via GPRS with GPS localization GIS and Fault Management Systems List of Jobs to be performed and remote automatic assignment of Jobs e-mail and intranet Check of security adds-on Camera and Barcode Reader Augmented reality High Efficiency in Work Force Management

Asset Management Overall Architecture Asset Mngmt Asset Management Overall Architecture Critical situations Previous method of investment allocation Risk-Based Asset Management Atlante Investments are allocated according to the components life cycle Definition of the best strategy to avoid critical situations Investments are allocated on the basis of solving grid critical situations € €

Asset Management Risk based network planning and asset allocation Asset Mngmt Asset Management Risk based network planning and asset allocation Satellite mapping of network assets Database of network events power outage notification, fault detection available and for each grid element Load flow analysis Investments based on a risk analysis for various network configurations Advanced DSS SW platform Predictive maintenance Process reengineering Optimization of network planning/ investment allocation and maintenance based on risk-return

Agenda Italian market context and Smart Meter Regulation The roadmap to smart networks and operational excellence Envisaging the future Infrastructure

Envisaging the future infrastructure Impact of Distributed Generation - Energy Flow at TSO-DSO boundary * MW 2010 2012 40.000 30.000 20.000 10.000 Weekdays Saturday Sunday * Avg. Load Curves (July 2012 Vs 2010)

Envisaging the future infrastructure Toward Smart Infrastructures Electricity Greater role in RES Dispatching Distributed Intelligence Sensors and actuators Network Adaptive Control Artificial Intelligence Transportation Electirc Mobility Electronic Control Grid-to-Vehicle and Vehicle-to-Grid Unmanned guide vehicle Gas Distributed Intelligence Smart Meter Energy Balance Sensors and actuators Network Convergence toward Electric Model Communication Broadband Always-on Wireless Augmented Reality Virtual Reality Smart Grids Increasingly an enabling factor/ DSO more and more a key role in energy sector

Envisaging the future infrastructure The New Role of DSO Renewables Smart Cities Smart Customers Dispatching Energy Storage solutions Renewables Forecast Broadband for grid management Energy Efficiency Electric Mobility – fast charge Smart Lighting Building to Grid Active Demand New services Smart Metering also for gas Consumption optimization

MV Energy storage Systems MV Energy Storage system of the “Isernia” project One of the few Storage in Europe and the first installed in Italy The scope of the installation is the study of smart grid applications in secondary substations Pmax= 1MVA - Energy: 500kWh

Active Control for Distributed Energy Resources connected to the MV network Advanced control system “always on” and standard-based communication solution connecting all the relevant nodes in the network, including DER locations. Voltage Control (at all nodes) and Power Flow Control in the MV network. New procedures for managing efficiently and reliably the Disconnection of DER units in the event of unwanted islanding operations.

Envisaging the future infrastructure Enel Smart Grids Vision: Building a smart Energy future Multi-directional ‘flows’ management Network automation Demand Response Smart Metering/ central and distributed Intelligence Electric mobility Storage and Plug & Play technologies LED Public Lighting Smart Cities Renewables sources integration Smart equipments and power electronics Allowing Smart Interactions between all connected parties to deliver sustainable, economic and secure electricity supply

Keeping our leadership one step ahead Executive Summary Enel mission is to efficiently deliver a sustainable, economical and secure electricity supply in a liberalized market Deployment of Smart Meters gives a competitive advantage in business processes and Smart Grids, where Enel is the technology leader Smart Meters deployment triggers the start of a Utility operations turnaround bringing advantages to all parties Enel heads international standardization and interoperability bodies for Smart Grids, and has leading edge technologies in these fields Enel wishes to support other utilities to improve their performances and to sustain their roadmap to excellence in technologies Keeping our leadership one step ahead

Thank you Antonello Buondonno Head of Europe and Americas Business Development Enel Infrastructure and Network Division antonello.buondonno@enel.com