Significant events of 2009

Acquisition of 20% of the generation assets of Electricity Supply Board (ESB)

On January 8, 2009, following approval from Irish and Community regulators, Endesa completed the acquisition for €444 million of KJWB (now Endesa Ireland), the Irish company to which 20% of the generation assets of the Electricity Supply Board (ESB) had been transferred. The assets acquired have a total capacity of 1,068 MW at four operational plants and 300 MW at two plants still under construction. They account for about 16% of Ireland’s total installed capacity.

Agreement with Acegas-Eps and Tei to build interconnection lines between Italy and Slovenia

On February 5, 2009, Acegas-Eps, Enel and Tei signed the memorandum of association of Adria Link, in which the three partners have equal shares. The company will build and operate electricity interconnection infrastructure between Italy and Slovenia, in line with the provisions of the “Scajola Decree”, which in transposing Regulation (EC) 1228/2003 aims to stimulate trade in energy with the EU countries, thereby enabling the achievement of efficiencies in the use of power stations at the European level and thereby lowering generation costs and sales prices. Adria Link intends to develop two interconnection projects that involve the construction of two underground power lines, which will link, respectively, the Zaule electricity station in the province of Trieste with the Dekani station in Slovenia and the Redipuglia station in the province of Gorizia with the Vrtojba station in Slovenia. The new lines will increase net transfer capacity by about 250 MW. The planned investment will come to about €31 million, part of which devoted to reducing the impact of the infrastructure on the environment and the landscape.

Acquisition of 25.01% of Endesa

On February 20, 2009, Enel signed an agreement for the acquisition of the 25.01% of Endesa owned directly and indirectly by Acciona. The agreement, which also involved the early exercise of the put option by Acciona (the original exercise date was March 2010), was subject to a number of suspensory conditions and also provided for the transfer to Acciona from Endesa of certain operational wind and hydro assets. On the same date, the Board of Directors of Endesa also approved the distribution of a dividend of €6.2 billion. Enel’s share (67.05%) was approximately €4.2 billion, that of Acciona (25.01%) about €1.5 billion and that of minority interests (7.94%) about €0.5 billion. At the same meeting, the Board concurrently approved the sale to Acciona, in line with the above agreement, of certain generation assets in Spain and Portugal, totaling 2,105 MW, of which 1,423 MW from alternative renewable resources and 682 MW of conventional hydro assets.

On June 25, 2009, Enel and Acciona, after the conditions governing the agreement of February 20, 2009 had been met, implemented the accord with the transfer to Enel Energy Europe (EEE) of the 25.01% of Endesa held directly and indirectly by Acciona. Following the transaction, Enel, through EEE, now holds a 92.06% stake in Endesa, giving it full control of the company.

EEE paid Acciona €9,627 million in cash for the transfer. The amount was determined by subtracting the Endesa dividends received by Acciona after February 20, 2009 (€1,561 million) from the value of the holding established on the basis of the criteria set out in the contract between Enel and Acciona on March 26, 2007 and incorporated in the agreement of February 20, 2009 (€11,107 million) and adding interest accrued as from that date (€81 million) and applied to the share of the debt taken by Acciona to acquire the 25.01% stake in Endesa.

As part of the agreement of February 20, 2009, Endesa committed to selling Acciona a number of plants operating in Spain and Portugal – with a number of changes in the plants involved compared with the original plan – with a total capacity of 2,079 MW, mainly from renewables. The price for the assets was €2,817 million (of which €2,814 million received in respect of sales completed as at December 31, 2009).

To help finance the purchase, Enel contracted a loan of €8 billion agreed in April 2009 (Credit Agreement 2009) as an increase in the syndicated credit line with an original amount of €35 billion, the terms of which included the option of increasing (up to a maximum of €8.5 billion) the C tranche (equal to €10 billion falling due in 2012) in the event of the exercise of the put option by Acciona in 2010. Of the total amount of the €8 billion loan, agreed with a pool of 12 banks, slightly less than 70% has a maturity of five years (€5.5 billion due in 2014) and the remaining portion has a maturity of seven years (€2.5 billion due in 2016).

The €8 billion credit line comprises two contracts:

• a “facility C increase” raising the C tranche by a total of €8 billion falling due in 2012; and

• a “rollover” agreement, in the amount of €8 billion, intended to replace and renew the “facility C increase” as from 2012 with two new tranches, the first totaling €5.5 billion falling due in 2014 and the second amounting to €2.5 billion falling due in 2016.

As in the Credit Agreement 2007, the interest rate under the Credit Agreement 2009 varies in relation to Enel’s rating.

Enel - EdF agreement for the development of nuclear power in Italy

On February 24, 2009, within the framework of the Italy-France Protocol of Understanding for energy cooperation, Enel and EdF signed a Memorandum of Understanding (MoU) that establishes the foundations for the joint development of nuclear energy in Italy by the two companies. When the legislative and technical work for the return of nuclear power in Italy is completed, Enel and EdF have undertaken to develop, build and operate at least four generation units based on European Pressurized Reactor (EPR) technology, the first of which is being built at Flamanville in Normandy, a project in which Enel is participating with 12.5% share. The goal is for the first Italian unit to enter commercial service no later than 2020. With the MoU, Enel and EdF have agreed to form a joint venture, each with 50%, that will be responsible for the development of the feasibility studies for the construction of the EPR units. Subsequently, once the studies have been completed and the necessary investment decisions are taken, individual companies will be formed to build, own and operate each of the EPR units. They will feature:

• a majority stake for Enel in ownership of the plants and electricity withdrawal rights;

• Enel leadership in plant operation;

• opening of ownership to third parties, with Enel and EdF retaining majority control.

The Enel-EdF agreement has a term of five years, with the possibility of extension.

On the same date, in a second MoU Enel expressed its interest in participating in an extension of the previous nuclear power accord with EdF for the construction of another five EPR units, beginning with the facility that the French Government recently approved for Penly.

Sale of Enel Linee Alta Tensione (ELAT)

In implementation of the sale agreement of December 19, 2008, between Enel SpA, Enel Distribuzione and Terna, on April 1, 2009, Enel Distribuzione sold Terna the entire share capital of Enel Linee Alta Tensione (ELAT), the company to which Enel Distribuzione transferred a business unit consisting of high voltage lines and the related legal relationships effective as of January 1, 2009.

The contributed business unit consists of an 18,583 kilometers network of high voltage power lines, as well as the related assets and liabilities. The purchase price of €1,152 million was paid in full at the time of closing and will be subject to an adjustment based on changes in the shareholders’ equity of ELAT between the reference date of the disposal balance sheet and the date of sale.

The closing of the transaction occurred once all the conditions of the agreement were met, in particular, receipt of clearance from the antitrust authorities, inclusion of the power lines in the National Transmission Network by the competent authorities and adoption of a measure by which the Authority for Electricity and Gas granted rate revenues for the business unit to ELAT.

Agreement with Australian Government for the development of carbon capture and storage technology

On April 22, 2009, within the framework of the Italy-Australia cooperation agreement for the development of technologies for carbon dioxide capture and storage, Enel and the Australian Government signed a Memorandum of Understanding that provides for the participation of Enel as a founding partner in the Global Carbon Capture and Storage Institute (GCCSI). The GCCSI is an organization founded at the initiative of the Australian Government, which funds the operation with a budget of around 100 million Australian dollars a year (55 million US dollars).

The goal of the institute is to mobilize public and private resources to promote CCS technology at the commercial and regulatory levels and foster public acceptance. The most immediate commitment is to accelerate the creation of over 20 pilot projects. Membership in the GCCSI will enable Enel to gather information on projects that are being developed outside Europe, to participate in the network of technological and industrial alliances that will be formed within the organization, to be constantly updated on CCS regulatory processes around the world, and to participate in the communication initiatives for the public around the world. In particular, the network of contacts offered by the Australian institute could also foster the development of CCS activities in China, an area of great interest to Enel.

Enel SpA capital increase

The Enel Extraordinary Shareholders’ Meeting of April 29, 2009, authorized the Board of Directors to carry out a paid divisible capital increase of a maximum total amount, premium included, of €8 billion. Such authorization can be exercised in one or more installments, no later than December 31, 2009, through the issue of ordinary shares with a par value of €1 each bearing dividend rights as from January 1, 2009, to be offered in pre-emption to the Company’s shareholders. Under the authorization, the Board of Directors has the power to establish the procedures, terms and conditions of the increase, including, inter alia, the determination of: (i) the exact amount of the share capital increase, (ii) the subscription price of the shares (including the premium), taking account of developments in the Enel share price and market conditions prior to the rights issue and market practice for similar transactions, and (iii) the number of new shares to be issued and the related pre-emption ratio.

On May 6, 2009, the Board of Directors voted – in execution of the authorization of the Extraordinary Shareholders’ Meeting of April 29, 2009 – to carry out a paid divisible capital increase of a maximum total amount, premium included, of €8 billion by way of the issue of ordinary shares with a par value of €1 each bearing dividend rights as from January 1, 2009. The shares have the same characteristics of the shares already in circulation and were offered in pre-emption to parties who were shareholders of the Company as of the start date of the rights offering in proportion to the number of shares they hold. On May 28, 2009, the Board of Directors determined the final terms and conditions for the rights offering, setting the subscription price at €2.48 per share – of which €1.48 represents the share premium – and the option ratio at 13 new shares for every 25 existing shares. The offering therefore involved the issuance of a maximum of 3,216,938,192 new shares, entailing a capital increase of €3,216,938,192, while the overall proceeds of the operation – share premium included – totaled €7,978,006,716.16.

The Ministry for the Economy and Finance, as a shareholder of the Company, notified Enel of its intention to participate , directly or indirectly, in the capital increase, subject to a final evaluation to be conducted in light of the definitive terms of the offering. On March 25, 2009, the Company shareholder Cassa Depositi e Prestiti SpA announced the unanimous decision of its board of directors to exercise both the rights granted directly to it and the rights granted to the Ministry (subject to the transfer of the Ministry’s rights to Cassa Depositi e Prestiti).

On May 28, 2009, Mediobanca, JP Morgan and Banca IMI as Joint Global Coordinators and Joint Bookrunners, Bank of America – Merrill Lynch, Credit Suisse, Goldman Sachs, Morgan Stanley, Unicredit as Co-Bookrunners, 13 banks as Senior Co-Lead Managers1 and 13 banks as Co-Lead Managers2 signed an underwriting agreement with Enel under whose provisions they undertook to subscribe the capital increase in respect of unexercised rights (if any), for a total amount of up to €5.5 billion – that is, the entire portion of the capital increase which is not expected to be subscribed, net of the direct and indirect portion pertaining to the Ministry.

As part of the underwriting agreement, consistent with market practice, Enel agreed to a lock-up clause continuing until the 180th day after the closing of the offering. In particular, Enel agreed not to issue or offer shares directly or via the issuance of convertible securities, warrants or other financial instruments that grant the right to acquire, exchange for, or be converted into shares Enel. Consistent with market practice, the lock-up commitment shall not apply, inter alia: (i) to the issuance or subscription of the shares involved in the offer, or (ii) to the issuance of Enel shares or to the granting of option rights to Company or Group executives and employees under any existing stock option plans.

In view of the above commitments by the Ministry for the Economy and Finance, Cassa Depositi e Prestiti SpA and the banks, the Company expected the capital increase to be fully subscribed.

During the offer period, which started on June 1 and ended on June 19, 2009, a total of 6,160,693,425 rights were exercised. As a result, 3,203,560,581 newly issued Enel ordinary shares were subscribed altogether, equal to 99.58% of the 3,216,938,192 shares offered, for aggregate proceeds to Enel of €7,944,830,240.88.

At the end of the offer period, total unexercised rights amounted to 25,726,175, granting the right to subscribe 13,377,611 newly issued Enel ordinary shares, for a total value of €33,176,475.28. The unexercised rights were offered on the Italian Stock Exchange through Mediobanca and purchased in their entirety, pursuant to Article 2441, paragraph 3, of the Italian Civil Code, at the session of June 26, 2009, for a total price of €13,120,349.

Upon the conclusion of the capital increase, on July 9, 2009, Cassa Depositi e Prestiti SpA, which had exercised both the rights granted directly to it and the rights granted to the Ministry for the Economy and Finance (following the transfer of the Ministry’s rights to Cassa Depositi e Prestiti), subscribed 1,005,095,936 newly issued Enel ordinary shares – equal to about 31.24% of the offered shares and about 10.69% of the new share capital of the Company – for a total of €2,492,637,921.28. Therefore, following the full subscription of the Enel capital increase and the settlement of the transaction, Cassa Depositi e Prestiti now holds about 17.36% of Enel’s share capital, while the Ministry retains a direct shareholding equal to about 13.88%. Consequently, the underwriting pool coordinated and directed by Banca IMI, JP Morgan and Mediobanca in their capacities as Joint Global Coordinators and Joint Bookrunners did not have to subscribe any of the shares.

Agreement with Eurus Energy Europe for the development of wind projects in Calabria

On April 30, 2009, Enel Green Power has signed an agreement with Eurus Energy Europe, a joint venture between Tokyo Electric Power Company and Toyota Tsusho Corporation, to acquire the rights to 50% of wind power projects with an installed capacity of up to 400 MW, of which 100 MW are at an advanced stage of the authorization process. The wind power projects are being developed at sites with high wind power potential in Calabria.

Agreement with SoWiTec for the development of wind projects in Chile

On May 8, 2009, Enel Latin America signed a cooperation agreement with SoWiTec Energias Renovables de Chile, a subsidiary of the German company SoWiTec International, for the development in Chile of a number of wind projects with a total installed capacity of up to 850 MW. With the agreement, Enel will have exclusive access to a range of projects that SoWiTec is developing and will be entitled to acquire the projects once they have received all necessary authorizations. The projects have a preliminary installed capacity of between 60 and 150 MW and are located in the northern electrical system (SING) and the central electrical system (SIC), in areas with good wind power potential.

Sale of 80% of Enel Rete Gas

On March 10, 2009, following completion of due diligence work begun following completion, on December 29, 2008, of the restricted call for expressions of interest, Enel received two offers from investors. Following examination of the offers and additional analysis and discussions with the bidders, Enel decided to grant one of them exclusive negotiating rights until May 8, 2009, subsequently extended first to May 12, 2009 and then to May 28, 2009.

On May 29, 2009, following approval by the Board of Directors of Enel SpA, an agreement was reached between Enel and F2i SGR SpA (“F2i”) and Axa Private Equity for the disposal of 80% of the share capital of Enel Rete Gas SpA to a vehicle in which F2i will hold 75% of the capital and Axa Private Equity 25%.

On September 30, 2009, the agreement between Enel Distribuzione, F2i SGR and AXA Private Equity was executed with the disposal of 80% of the share capital of Enel Rete Gas, a 99.88%-owned subsidiary of Enel Distribuzione, to F2i Reti Italia, a special-purpose vehicle 75%-owned by F2i SGR and 25%-owned by Axa Private Equity.

Prior to closing, Enel Rete Gas distributed an extraordinary dividend totaling around €225 million to Enel Distribuzione and minority shareholders and signed a financing agreement for €1,025 million with a pool of banks. The disposal was executed following clearance from the Competition Authority.

The price was set at €515.7 million, €35.7 million more than the originally announced figure of €480 million. The increase was agreed partly on the basis of the new regulatory asset base (RAB) of Enel Rete Gas announced in July 2009 by the Authority for Electricity and Gas. Under the accord, the price, which was subject to adjustment based on Enel Rete Gas’ actual net financial position at closing, was to be paid in two installments .

Enel Distribuzione received an initial payment of €240 million from F2i Reti Italia at the time of the closing. Of this amount, €167.5 million was financed from the purchasers’ own resources, while €72.5 million was financed with a vendor loan from Enel to F2i Reti Italia bearing an annual interest rate of 8.25% and falling due in 2017. The second installment of €275.7 million was paid on December 28, 2009. Of this amount €203.2 million was financed from the purchasers’ own resources and €72.5 million with a second tranche of the vendor loan mentioned above .

Enel Distribuzione holds a call option on the 80% of Enel Rete Gas, which can be exercised, subject to certain conditions, as from 2014 (year of expiry of the five-year lock up period that applies to both Enel Distribuzione and F2i Reti Italia) and until 2018. The strike price of the call option will take account the fair market value of the stake. At the end of the lock-up period, the parties will assess the possibility of seeking a listing for Enel Rete Gas.Overall, the transaction will reduce Enel’s consolidated net financial debt by over €1.2 billion, taking into account the price received for the equity stake and the deconsolidation of the debt of Enel Rete Gas as of the disposal date.

Award of offshore exploration license in Egypt

On May 13, 2009, Enel announced that it had been awarded a license to explore an area offshore from the Nile Delta in a joint venture with Total. The license was obtained in the International Bid Round 2008 organized by the Egyptian state-owned company EGAS. Total will hold 90% of the joint venture and will operate the project, while Enel will hold the remaining 10%. The license regards the El Burullus block, which covers 2,516 square kilometers. It is about 70 kilometers from the coast in waters ranging from 100 to 1,600 meters deep. The contract provides for an initial four-year exploration period, during which the partners will acquire geophysical data (3D seismic prospecting) and drill a number of wells.

Thanks to an agreement signed between the Italian and Egyptian governments, Enel has begun a new phase of cooperation with the Egyptian Energy and Electricity Ministry and with EEHC, the Egyptian electricity company, in the field of energy efficiency and electricity generation using renewables.

Sale of 51% of SeverEnergia

On May 15, 2009, Eni and Enel signed an agreement with Gazprom for the sale to the latter of 51% of SeverEnergia, the company that wholly owns Arcticgaz, Urengoil and Neftegaztechnologia, which hold licenses for the exploration and production of hydrocarbons with gas and oil reserves estimated at about 5 billion barrels of oil equivalent. The parties have agreed to start gas production in June 2011 from the Samburskoye field and to reach an output of at least 150,000 barrels of oil equivalent per day within two years of starting production. The parties have also agreed to cooperate on seeking the renewal and updating of the licenses and defining the details of the development plans for the fields.

On June 5, 2009, the parties signed the share purchase agreement. On September 23, 2009, Eni and Enel sold Gazprom 51% of SeverEnergia for about $1.6 billion, of which $626.5 million pertaining to Enel. Gazprom paid the first installment of $384 million (of which Enel received $153.5 million) at the closing and will pay the second and final installment (which will earn interest in the meantime) by March 2010. Following the sale, Enel’s stake in SeverEnergia decreased from 40% to 19.6% and that held by Eni from 60% to 29.4%.

Enel - Ministry for the Environment Agreement

On July 7, 2009, within the framework of the “Pact for the Environment” promoted by the Italian Government and 11 Italian companies, Enel and the Ministry for the Environment signed a voluntary agreement with which Enel undertakes to implement effective, measurable programs with a view to achieving national and Community targets for reducing greenhouse gas emissions, energy efficiency and the development of renewable energy resources. More specifically, Enel has agreed to increase the installed capacity of renewables plants from its level of 2,597 MW (excluding major hydroelectric plants) at the end of 2008 by an additional 4,100 MW by 2020. In the thermal power sector, Enel has undertaken to replace its old low-efficiency fuel oil plants (which have an efficiency of 38%) with new clean-coal plants (with an efficiency of 45%). Enel has also agreed to increase the use of biomass and fuels from waste to generate electricity in its power station from 137.5 thousand metric tons in 2008 to 300 thousand metric tons a year in 2013. Enel intends to strengthen its commitment to promoting energy efficiency among end users: in public lighting (including the use of LED technology);in the distribution network with the development of “smart grids”; in cooperative initiatives with industrial customers to conduct energy audits to optimize their consumption. By 2013, such actions are expected to create savings of some 100 thousand metric tons of oil equivalent, with savings rising to 300 thousand metric tons in 2020.

The Ministry for the Environment and the Government have agreed:

• to identify, in compliance with applicable regulations, possible measures to accelerate the authorization procedures for which they are responsible in order to enable rapid implementation of the Enel initiatives envisaged in the agreement;

• to support the projects in which Enel is participating as part of activities to promote the participation of Italian companies in European environmental research and innovation programs;

• to promote the reuse of existing industrial sites, fostering investments with a substantial positive environmental impact.

Project to leverage non-core real estate assets

On July 16, 2009, Enel’s Board of Directors approved a plan to create a fund to be endowed with the Group’s non-core real estate assets, engaging Fimit SGR to organize and manage the fund. The value of the property to be transferred to the fund is about €190 million. Following the transfer of the property to the fund, Enel will participate in both the Committees and the General Meeting of unit holders, thereby maintaining a major governance role. Fimit SGR will begin to divest the real estate assets, generating revenues for Enel in proportion to its holding in the fund and thereby leveraging the value of the assets more effectively. The operation had not been completed as of December 31, 2009, as the authorizations required under applicable law governing the establishment of new funds had not yet been received.

 

 

Establishment of an Enel/EdF joint venture for the development of nuclear power in Italy

 

On July 31, 2009, Enel and EdF established the joint venture “Sviluppo Nucleare Italia Srl” (each with a 50% stake) to undertake feasibility studies for the construction in Italy of at least four advanced third-generation EPR plants as envisaged in the agreement between Enel and EdF signed on February 24, 2009. Once the studies have been completed and the necessary investment decision taken, other individual companies will be formed to build, own and operate each of the EPR power plants. The creation of Sviluppo Nucleare Italia marks a first, substantial step towards the implementation of plans to develop nuclear power in Italy following the approval of enabling legislation on July 9, 2009, thus paving the way for the return of nuclear power to the country.

Protocol of understanding between Enel and the Region of Sicily for energy development

On August 6, 2009, Enel and the Region of Sicily signed a protocol of understanding for energy development on the island. The goal is to general more electricity at lower cost and low environment impact. The accord devotes particular attention to diversifying sources of energy (with an increase in the use of renewables), to ensuring the security of supply with infrastructure projects and to investing in new technologies, research and innovation. The protocol provides for a Framework Agreement and three specific agreements regarding: the Porto Empedocle regasification project, the improvement of the environmental performance of Enel’s thermal plants in Sicily, and the promotion and implementation of innovative projects to develop renewable power generation on the island. Enel and the regional government will form a joint working group to coordinate and monitor the agreed initiatives.

More specifically, with regard to the Porto Empedocle terminal, further to the agreement, the Region of Sicily issued the authorization decree for the construction and operation of the terminal based on the favorable opinion expressed by the Services Conference. The agreement calls for about €50 million in infrastructure works and a grant linked to the operation of the plant worth around €6 million per year.

As regards the environmental quality of the plants in Sicily, Enel is committed to investing some €70 million between 2009 and 2013 to ensure the continuing full efficiency of the power plants, enhancing their quality and minimizing their environmental impact.

Finally, Enel and the Region of Sicily will also collaborate to develop electricity generation from renewables and undertake innovative projects, working to ensure that the authorization process proceeds as swiftly as possible. The plans call for new facilities with a total capacity of 400 MW of green energy over the next four years, with a total investment of about €1 billion.

Bond issues

On September 10, 2009, Enel, acting through its subsidiary Enel Finance International, launched – in implementation of the Enel SpA Board resolution of July 30, 2009 – a multi-tranche bond targeted at institutional investors on the international market. The bond is denominated in euros and pounds sterling with an aggregate value of over €6.5 billion. The bond was issued under the recently renewed Global Medium-Term Notes program.

The transaction, run by a syndicate of banks consisting of BNP Paribas and Deutsche Bank (as global coordinators and joint bookrunners) and Barclays Capital, BBVA, Calyon, Royal Bank of Scotland, Banco Santander and Société Générale (as joint bookrunners), received over €28 billion euros in orders. The transaction consists of the following four tranches (all guaranteed by Enel SpA):

• €1,500 million fixed-rate 4.00% bond due 2016;

• €2,500 million fixed-rate 5.00% bond due 2022;

• £850 million fixed-rate 5.625% bond due 2024;

• £1,400 million fixed-rate 5.75% bond due 2040.

All the above tranches are listed on the Irish Stock Exchange.

On September 30, 2009, Enel Finance International launched – again in implementation of the July 30 Board resolution – a multi-tranche bond on the US and international markets targeted at institutional investors for a total of $4,500 million, equal to an aggregate of about €3,073 million. The bonds were issued under the recently renewed Global Medium-Term Notes program.

The transaction, run by a syndicate of banks consisting of Citigroup Global Markets Inc. and J.P. Morgan Securities Inc. (as global coordinators and joint bookrunners) and of Bank of America Securities, Barclays Capital, Credit Suisse Securities (USA), Deutsche Bank Securities and Morgan Stanley & Co. (as joint bookrunners), was more than twice oversubscribed. The transaction consists of the following three tranches (all guaranteed by Enel SpA):

• $1,250 million fixed-rate 3.875% bond due 2014;

• $1,750 million fixed-rate 5.125% bond due 2019;

• $1,500 million fixed-rate 6.0% bond due 2039;

Agreement for the use of CO₂ capture and sequestration technology in China

On September 14, 2009, following through on the Memorandum of Understanding signed in Beijing in May 2008, Enel, the Minister for Science and Technology of the People’s Republic of China and the Italian Minister for the Environment signed an agreement for a joint feasibility study into the construction of a system for capturing carbon dioxide produced at a Chinese coal-fired plant and injecting it into an oilfield, thereby increasing crude oil production.

Interim dividend for 2009

On October 1, 2009, the Board of Directors of Enel approved an interim dividend for 2009 of €0.10 per share. The interim dividend, gross of any withholding tax, was paid as from November 26, 2009, with the ex-dividend date for coupon no. 15 falling on November 23, 2009.

Sale of Empresa de Energía de Bogotà

On October 5, 2009, Endesa sold its 7.2% stake in the Colombian company Empresa de Energía de Bogotà, which operates in the Bogotà-area energy transport market, for $247 million.

Final agreement for the development of the hydroelectric sector in the Province of Bolzano

On October 20, 2009, further to the preliminary agreement signed on October 23, 2008, Enel Produzione and Società Elettrica Altoatesina SpA (SEL) signed the Final Agreement to jointly develop the hydroelectric sector in the Province of Bolzano. The Province owns approximately 94% of SEL, with the remainder held by the municipalities and the district communities of the Alto Adige Region through Selfin Srl. Considering that both parties will continue to participate in a fully autonomous manner in the administrative procedures currently in progress for the thirty-year issue or renewal of the concessions for major hydroelectric diversions expiring on December 31, 2010, Enel Produzione and SEL have agreed to form a company (owned 40% by Enel Produzione and 60% by SEL) for the joint operation as from 2011 and until at least 2040 of any concessions granted or renewed by the provincial authorities, with a view to developing industrial synergies by optimizing their respective skills. The agreement confirms all the main elements of the preliminary accord, specifying that SEL will designate or establish the newco as a private limited company, headquartered in Bolzano. Enel Produzione will contribute the business unit associated with the major hydro diversions in the Province of Bolzano, the value of which is estimated at €340 million, while on January 1, 2011, both the parties will contribute the concessions obtained independently. The parties also defined the shareholders’ agreement that will regulate the governance of the newco, under which Enel Produzione will exercise control over the new company until December 31, 2013 and will therefore consolidate its results on a full line-by-line basis until that date. The parties are also required to maintain, throughout the duration of the joint venture, stakes in the newco of at least 51% for SEL and 31% for Enel Produzione. In addition, the text of the bylaws of the newco gives the two shareholders, inter alia, a reciprocal right of first refusal.

Acquisition of exploration licenses and gas assets in Northern Italy

On November 6, 2009, Enel Trade acquired gas assets and exploration permits from the Canadian company Stratic Energy Corporation for €34 million. Enel will pay an additional €6.6 million to Stratic Energy Corporation provided that the first production phase starts before the end of 2011, reducing the amount if production starts after the end of 2012.

The transaction, which comprises all of the Canadian company’s Italian gas assets, is subject to the normal industry conditions, including regulatory approval, and is expected to be finalized in the 1st Quarter 2010.

Wind power pipeline of 1,000 MW in Mexico

On November 9, 2009, Enel Green Power, acting through its subsidiary Enel Latin America, reached an agreement with Energías Renovables, Térmica e Hidráulica de México, S.A. (Enerthi) aimed at developing wind power projects in Mexico for a total capacity of up to 1,000 MW. Under the agreement, Enel Green Power will have exclusive access to wind power projects being developed by Enerthi, as well as the right to acquire these projects once they are fully authorized.

Thanks to this agreement, Enel Green Power will strengthen its presence in the Mexican renewable energy market, which has a wind power potential of more than 10,000 MW.

Agreement with Geronimo Wind Energy for the development of wind power projects in the United States

On November 26, 2009, Enel Green Power, acting through its subsidiary Enel North America, reached an agreement with Geronimo Wind Energy to acquire a minority stake in the US company. The two companies will cooperate in the development of Geronimo Wind Energy’s wind power pipeline, which includes projects with a total installed capacity of up to 4,000 MW. Under the accord, Enel Green Power will have a priority right to acquire and operate the wind projects developed.