1. Frankfurt (Germany), 6-9 June 2011 ENEL Group Italian core European base Worldwide strategy Italy’s largest power company. Europe’s second listed utility by installed capacity Presence in 40 countries on 4 continents 2 nd largest DSO in Europe 33 million Customers over 1.100.000 km lines 260 TWh Energy Distributed 2 million spot-lights in Public Lighting Jon Stromsather – Italy – Round Table 6a – 0832 ENEL Distribuzione:

2. Frankfurt (Germany), 6-9 June 2011  Distribution activities are regulated: Tariff and QoS regulation.  Currently under Third Regulatory Period (2008-2011).  2010: AEEG approved 2% additional WACC on selected Smart Grids pilot projects. Jon Stromsather – Italy – Round Table 6a – 0832 Italian Regulatory Framework and electricity market Customers Enel Distribuzione (>85%) Big Municipalities (Acea, etc.) Municipalitie s TERNA (HV) Italy Network market structure  Full liberalization of retail electricity market from 1 July 2007. Distribution10% Metering 2% Commercial Act. 0,5% GenerationTransport System charges Taxes TOTAL* 100% 61% 16% 9% 14% Price of electricity components (%) in Italy 2011-1Q

3. Frankfurt (Germany), 6-9 June 2011  DSOs enable new market of services.  DSOs should not enter market of services  Play an active role in standardization, key for open electricity market to develop.  DSO could play role of “neutral and transparent information hub” to enable demand response. Role of DSOs in open electricity market Jon Stromsather – Italy – Round Table 6a – 0832

4. Frankfurt (Germany), 6-9 June 2011  DSOs are strategic enablers of new Smart Grid scenario: Manage Smart Metering infrastructure and data (Telegestore) Enable Active Demand Define DER connection criteria to ensure network QoS and reliability, possibly enable ancillary services from DG and take a role in dispatching DG on the distribution network. Guarantee controllability of EV charging by managing/owning EV charging stations (DSO model) or by defining connection criteria (other models) Possibly operate storage facilities for the management of distribution network Role of DSOs in Smart Grids Jon Stromsather – Italy – Round Table 6a – 0832

5. Frankfurt (Germany), 6-9 June 2011 TELEGESTORE Experience Jon Stromsather – Italy – Round Table 6a – 0832 Telegestore ® Project Team: 250 resources More than 3500 third-party installers 120 ICT Project technicians 33.000.000 LV Meters 358.000 LV concentrators (LV-C) 127 Geographical operating units 8.000 palm-PC during massive meters replacement 85 % of Electricity Distribution market in Italy Field devices Resources Project perimeter

6. Frankfurt (Germany), 6-9 June 2011 Other ENEL Smart Grid Projects Jon Stromsather – Italy – Round Table 6a – 0832 Integration of DER Italy Energy Consumption / efficiency Electric mobility GRID4EU (under negotiation) POI Progetto Isernia Smart Info e-mobility Italy Europe

7. Frankfurt (Germany), 6-9 June 2011  Increased need of DSOs to continue upgrading power grid infrastructure.  Increased interaction with TSOs, suppliers, generators, and market operators.  Increased role of DSOs in facilitating DER integration, enabling Active Demand and controlling EV charging.  Increased communication efforts with customers to “sell” benefits of Smart Grid. Expectations for the future Jon Stromsather – Italy – Round Table 6a – 0832