11/04/2008

The Department of innovation and industry of the Galician regional government is extending its agreement with Begasa, Union Fenosa APYDE in order to improve the power supply

The agreement includes a total budget of almost 26 million euros, which will be invested in facilities that provide a higher quality of delivery service

The Department of Innovation and Industry of the Galician regional government has signed an agreement with the companies Barras Electric Galaico-Asturianas (Begasa), Unión Fenosa and the Association of Producers and Distributors of Energy Galicia (APYDE) with the aim of improving the quality of electricity supply in the area.

Through this agreement, the signatories commit a total of 25,941,738 euros to be spent on improving facilities and distribution service. In order to achieve this goal and implement these plans to control tension, the first agreement was signed in December 2006 and has been extended each year. Furthermore, at this year’s convention a budget had been included designated to prune trees; an action which is related to improve the quality of electricity supply.

The three companies that signed the agreement will face up to 70% of the costs of the three activities that are planned: improving the quality, control of tension and cleaning of trees.

In the signing of the agreement Fernando X. White, Counselor of Innovation and Industry; Miguel Antoñanzas, President of Begasa and E.ON España; Honorato Lopez Island, First Vice-President and CEO of Union Fenosa and Jose Manuel Arufe Rieiro, President of APYDE were involved.

The distribution of electric power in Galicia is subject to a number of factors that complicate and increase the costs of operation and maintenance of facilities. At the same time major investments towards the remaining companies in the electricity sector in the rest of Spain are required due to the abundant vegetation, a particular adverse climate, difficult terrain, scattered population centers without comparison with the rest (49% of living centers of Spain are in Galicia, with a population accounting for 6.6% of the total Spanish population) and a complex road network.

The development of the agreement signed is a step to equalize our electricity infrastructure and quality of supply, matching these data with those of other communities in Spain and the European Union.


Begasa

On its part, Begasa, a company owned by E.ON España and Union Fenosa, will invest in its distribution range, which compasses the center and north of the province of Lugo, a total of 2,918,000 euros until 2010 with the aim to carry out the automation of the medium voltage network, the protection of remote controls and the re-electrification of low-voltage networks.
This press release may contain forward-looking statements based on current assumptions and forecasts made by E.ON Group management and other information currently available to E.ON. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. E.ON AG does not intend, and does not assume any liability whatsoever, to update these forward-looking statements or to conform them to future events or developments.