TERNA activities in supporting standard developments: a Smart Grid vision

1. TERNA activities in supportingstandard developments:a Smart Grid vision CIM meeting - Milan, June 16th 2010 Ing. Enrico Maria Carlini

2. Index • Terna profile and international organizations • CIM Standard in Terna and in ENTSO-E frame • Terna for smart grids

3. The Figures of the Italian Grid • Over 62.000 km of EHV and HV lines • 1.043 km underground cables • 914 km subsea cable • 10.313 km operated to 380 kV • Over 383 transforming and switching stations • Transforming capacity 122 GVA • n.18 interconnection lines • n.4 France • n.9 Switzerland • n.1 Austria • n.2 Slovenia • n.1 subsea with Greece • n.1 subsea with Corsica • 317,6 TWh the 2009 energy demand • 51.873 MW the 2009 maximum power demand • (56.822 MW the historical record on 18th December, 2007) As from the April 1st 2009 with the Enel asset acquisition, Terna was confirmed the first independent operator in Europe and 7th in the world.

4. 2010-2014 Strategic Plan Strategic Target forward Sustainable Growth and Key Development Projects • The New Strategic Plan includes total investments for over 4.3 bn€ (3.3 bn€ of which for grid development). • The National Development Plan (Roll Over of the 10-Year Plan from 2010 to 2019) contains investment for about 6.9 bn€. Trino-Lacchiarella Udine O.-Redipuglia Italy-France Interconnection Dolo-Camin La Casella -Caorso • Terna publishes a Sustainability Report drafted according to the Reporting Guidelines of the Global Reporting Initiative GRI-G3. • Terna is included in the ethical indexes FTSE4Good (Financial Times Stock Exchange in London), Ethical Index EURO (Socially Responsible European Companies with greatest capitalization) and is among the 10 European companies that were awarded the Ruban d’Honneur from the European Business Award 2009 in the Sustainability category. Rationalization Torino Colunga-Calenzano Adriatic Backbone S. Barbara-Casellina Italy-Montenegro Interconnection SA.PE.I. Foggia-Benevento HV substations for renewables (S. Severo-Troia-Deliceto-Bisaccia-Maida) Sorgente-Rizziconi Paternò-Pantano-Priolo

5. Terna in many international organizations • IEC - International ElectrotechnicalCommission • The IEC is the world's leading organization that prepares and publishes International Standards for all electrical, electronic and related technologies • Cigrè - Conseil International des Grands Réseaux Électriques • CIGRE is one of the leading worldwide Organizations on Electric Power Systems, covering their technical, economic, environmental, organisational and regulatory aspects • ENTSO-E - European Network of TSOs for electricity • Established on a voluntary basis on 19/12/09 by 42 TSOs of 34 Countries, it replaces the previous EU TSOs Associations (ATSOI, BALTSO, ETSO, NORDEL, UCTE and UKTSOA). In ENTSO-E the TSOs cooperate regionally and on the European scale, and through ENTSO-E they communicate their needs and positions on European and regional issues • WEC - World Energy Council • WEC is the foremost global and inclusive forum for impartial dialogue and thought leadership on common energy future, including governments, industry and expert institutions. Its mission is to promote the sustainable supply and use of energy for the greatest benefit of all • VLPGO - Very Large Power Grid Operator • VLPGO is a voluntary initiative of the world’s largest Power Grid Operators, representing together more than 60% of the electricity demand in the world • OME - ObservatoireMéditerranéen de l'Energie • OME is the association of leading Mediterranean energy companies. The mission of OME is to promote the cooperation in the Mediterranean Basin, making of energy an element of regional integration

6. Index • Terna profile and international organizations • CIM Standard in Terna and in ENTSO-E frame • Terna for smart grids

7. CIM Standard in Terna and EuropeanTSOs • Old ASCII Standards permit only Load Flow Analysis and Three phase short-circuit • New CIM Standards allows performing also of unbalanced short circuit and dynamic analyses. Terna was convenor of Method & Tools in UCTE and actively fostered this process UCTE agreed to launch an initiative for development of new UCTE “XML based” data exchange format that will be considered as a standard for exchange of load flow and dynamic data November 2007: ENTSO-E System Development Committee decided for the first ENTSO-E data collection for planning models that will use CIM/XML Terna was convenor of Network Modeling & Data in ENTSO-E and supported this process September 2009: Actually ENTSO-E is collecting the first CIM Planning Grid Models: 2015 WP, 2015 SP, 2015 SoP and 2020 WP Terna provided CIM compliant models as well as DE, FR, AT, DK June 2010:

8. CIM Standard in Terna and EuropeanTSOs Terna, as test witness, will attend the IOP test as well as attended IOP tests in Paris (2009) Next Inter-OPerability test in Brussels will involve the dynamic data exchange in planning and in operation July 2010: Next data collection for ENTSO-E operational models will test CIM standard; many TSOs are working in order to use CIM standard in operation Terna supports this activity as member of ENTSO-E Network Model & Forecast Tool Next step: Terna is convenor of System Adequacy & Market Model in ENTSO-E and will support this process Possible future data collection for ENTSO-E market models in CIM standard; Next step: In the next future it will be useful thinking about the full use of the CIM/XML standards for TSO’s internal data exchange.

9. Main data handled in TERNA SPIRA Planning Tool Main internal data exchange could be done by CIM/XML format SICRE Dynamics Tool CRESO OperatingTool SCADA PROMED Market study Data Exchange with other Parthies (e.g. ENTSO-E, TSOs) Statistical database Registry database GIS database

10. Index • Terna profile and international organizations • CIM Standard in Terna and in ENTSO-E frame • Terna for smart grids

11. Smart Grid concept SGs are innovative electrical grids that allow the integration of the Centralized and Distributed Generation. By the future configuration of the network (microgrids or virtual power plants), the unit connected of the grid could be controlled to ensure the full exploitation of the resources on the grid. • Goals of the integrated network: • Ensure the transmission grid reliability • Improve the grid exploitation • Increase the operating flexibility • Simplify the grid access • Raise the efficiency of the power system

12. Smart component on the Italian Transmission System Installed at the moment • PSTs system on the 380 kV Albertville-Rondissone double line • Nominal Power = 2x1.630 MVA • In service since 2004 • It controls the power exchange from FR to IT and balances flows on FR-IT tie-lines • It adjusts the power exchange, balancing it between France and Switzerland to Italy • PST on the 220 kV Padriciano-Divacca • Nominal Power = 370 MVA • In service since 2007 • It controls the power exchanges form SL to IT • It balances flows on the 400 kV Divacca-Redipuglia and 220 kV Divacca-Padriciano tie-lines • HVDC SA.PE.I (Sardinia – Mainland) • Power capacity = 2x500 MW (in service since 2009 the first 500 MW pole) • It controls the transferred power from/to Sardinia and improves the Security of Supply • Automatic Trip Devices - WAMS • Increase the exchange among market zones • Improve the grid exploitation

13. Smart component on the Italian Transmission System Installed at the moment: how the Albertville-Rondissone PSTs system works? Scenario A: PSTs managed disjointed Scenario B: PSTs balance flows on the FR-IT tie-lines Scenario C: PSTs control flows from FR to IT in case of the 380 kV Venaus-Villarodin is unavailable ABVZ (FR) RONT (IT)

14. Smart component on the Italian Transmission System Installed at the moment: how the Albertville-Rondissone PSTs system works? Scenario A.0: PSTs managed disjointed Scenario A.1:N-2 Robbia-Sfiorano/Robbia-Gorlago contingency -> Import from FR to IT increases Scenario A.2: after the contingency, PSTs system control flows thus balancing the import on the North border ABVZ (FR) RONT (IT)

15. Smart component on the Italian Transmission System Installed at the moment: how the Padriciano PST works? DIVL (SL) Scenario A,B.0: PST balances flows among the IT-SL tie-lines Scenario B.1:N-1 Divacca-Redipuglia contingency -> Increases the import on the 220 kV link controlled by the PST Scenario B.2: after the contingency, PST adjusts flow on the 220 kV link thus reducing the import from SL to IT PDRV (IT) RDPV (IT)

16. Smart component on the Italian Transmission System Installed at the moment: how the Automatic Trip Devices work? ATD system increases the exchange capacity among market zones It improves also the grid exploitation and the energy production by more efficient power plants

17. Smart component on the Italian Transmission System Planned: ahead full SGs implementation into the Italian Transmission System • Sometime power flows on the grid are undesirable • FACTSs allow to control and modify the parameters in the grid thus obtaining the redispatching of power flows • PST device controls the voltage phase angle among two node changing the transferred active power • HVDC device allow to change the transferred power among poles Smart system involves PST, HVDC, … PST 6 HVDC 4 5 3 400 kV link 2 220 kV link 1 8 7

18. Smart component on the Italian Transmission System Planned: ahead full SGs implementation into the Italian Transmission System Capacitors and reactors allow to control the reactive power on the grid thus obtaining a voltage/var optimization (> 3.000 MVAr) Capacitors on the HV network Reactors on the EHV network Studies show that the grid needs a var regulation system (SVC, STATCOM,…) to regulate the reactive power in the network thus improving the voltage profile also in dynamic conditions. Implementation studies of smart components on the grid require an exchange of a huge quantity of information about the network CIM code

19. Back-up

20. Terna is a major electricity transmission grid operator, led by Luigi Roth - Chairman and Flavio Cattaneo - Chief Executive Officer. It is the main owner of the National High Voltage Electricity Transmission Grid with over 98% of the national electricity infrastructures. It is responsible for the transmission and dispatching of electricity throughout the entire national territory. It is responsible for grid planning, development and maintenance by providing know-how and technology in order to improve grid efficiency. With the acquisition of Enel Alta Tensione’s assets, as of April 1, 2009, Terna was confirmed as the first independent operator in Europe and the seventh in the world, with over 62,000 km of ELECTRICITY LINES MANAGED . Terna : company profile

21. Terna is a large Italian company, with over 3,500 employees and a widespread presence throughout the national territory. It is an outstanding Italian company, with over one thousand specialized workers who keep the efficiency of the grid and ensure the national electricity system’s safety. It is a major investor in people’s skills, development and training and in 2009 it ranked among the 28 outstanding companies that were included in the first Italian edition of CRF Top Employers, that analyzed and certified the best companies also in terms of personnel policies. Terna People

22. Shareholding Structure and Performance Share performance Terna was appointed by the EEI International Utility Award the best European utility according to its total returns in the last three years. Since its listing in June 2004, Terna’s shares gained 87%, compared to the 19% drop that was registered by the FTSE Mib index. Its total shareholder return was significantly higher than the average of Italian companies (157% versus 0.3% of the FTSE MIB). The Dividend Yield has always been at the top in the sector, higher than 5%. • 2009 Financial Statements • Terna ended 2009 with revenues equal to 1,306.7 million euros. • The EBIDTA, equal to 1,003.2 million euros, grew by 18%, while the net income stood at 771 million euros, +135.4% compared to 2008. • Investments, equal to 900,4 million euros, increased by 17.7% compared to the previous year.

23. 62,000 km of EHV and HV LINES 121,501 MVA the TRANSFORMATION CAPACITY 18 INTERCONNECTION LINES WITH FOREIGN COUNTRIES: 16 ALONG THE ALPS (4 FRANCE, 9 SWITZERLAND, 1 AUSTRIA, 2 SLOVENIA), 1 SUBMARINE LINE WITH GREECE, 1 SUBMARINE LINE WITH CORSICA 383TRANSFORMING AND SWITCHING STATIONS 218 KM THE LONGEST LINE (“MATERA-S.SOFIA”, BETWEEN BASILICATA AND CAMPANIA) 1,600 M THE DEPTH OF THE SA.PE.I SUBMARINE CABLE between Sardinia and the mainland (THE DEEPEST IN THE WORLD) 317.6 THE DEMAND IN ITALY IN 2009 56,822 MEGAWATTS THE HISTORICAL RECORD OF MAXIMUM POWER DEMAND (December 18, 2007) The Figures of the Italian Grid