The exclusive concession for electricity transmission was awarded to us by the Portuguese State on June 15, 2007 and has a duration of 50 years. The concession granted to us includes the planning, the construction, the operation and the maintenance of the RNT (National Electricity Transmission Grid). It also includes research and development relating to electricity transmission and the technical global management of the system to ensure the coordination of the electricity distribution and electricity transmission infrastructures, thereby protecting the continuity and security of supply and ensuring the integrated and efficient operation of the national electricity system.

As the concessionaire for the national transmission network, REN-Rede Elétrica is obliged to ensure the continuous supply of electricity, to meet quality standards and to meet safety criteria set forth by DGEG. For this purpose, DGEG approved a Quality of Service Regulation that seeks to enhance the quality of service with a system of penalties assessed against electricity companies that fall below DGEG's benchmarks. We strive to maintain and improve our quality of service through appropriate planning for safety and to ensure continuous supply, adequate investment in the renovation of older power lines and substations, suitable maintenance policies and strategies and efficient use of technical and human resources in the operation and maintenance of the RNT. See "Electricity Sector Regulation - Regulatory Codes".
 
The national transmission network in Portugal

The Grid covers the length of mainland Portugal and is interconnected with the Spanish electricity network (Red Eléctrica de España ("REE")) at nine points, including four 400 kV interconnections, three 220 kV interconnections, one 130 kV connection and one 60 kV connection. Average import capacity for commercial use in 2009 was 1205 MW. Three new interconnections, two in Minho and one in the Algarve are slated for construction, to be completed in 2011-2014.

The National Electricity Transmission Grid operated 1,609 km of 400 kV lines, 3,289 km of 220 kV lines and 2,671 km of 150 kV lines, at the end of 2009 - totalling 7,569 km of lines and total transformation capacity of 28,235 MVA.

The very high voltage grid (400 kV lines) extends in a north-south direction alongside the coast, from the Alto Lindoso power plant in the North to the Sines power plant in the South. This grid also extends in an east-west direction, interconnecting with the Spanish electricity grid. The 220 kV lines primarily link Lisbon and Porto, as well as running diagonally across the country between Miranda do Douro and Coimbra. 220 kV lines also run along the River Douro and through the Beira Interior region. The very high voltage grid is further enhanced by a number of 150 kV lines, the first voltage network installed by the National Electricity Transmission Grid (in 1951).

As at 31 December 2009, the National Electricity Transmission Grid linked 46 power plants (28 hydroelectric plants, 9 thermal plants and 9 special regime generation plants - mostly wind farms) and 87 facilities (injection or reception points between power plants and distributors or large-scale industrial consumers. 14 of those 87 facilities are owned by large-scale consumers and 71 of the remaining 73 (61 transformation sub-stations, 10 switching stations and 2 sectioning stations) are owned by REN.

Quality of service of the national transmission network

The objective of REN - Rede Eléctrica is to maintain and improve the quality of the service it provides, by planning new infrastructure, investing in the renovation of older lines and substations and executing effective maintenance strategies and policies. Efficient use of technical and human resources to operate and maintain the National Grid also results in increased safety of the Grid and an uninterrupted supply.

The quality of service provided by REN in 2009 in supplying consumer electricity was high, sustaining and strengthening the improvement trend of previous years. The Equivalent Interruption Time indicator recorded a new historic low (0.42 minutes) in 2009 and the other four general service indicators, as set out in the Service Quality Regulation, had the second best figures ever, keeping REN - Rede Eléctrica among the top European companies for these indicators.

Upgrading and expansion of the transmission network

REN needs to invest in the renovation and extension of the National Electricity Transmission Grid to improve its transmission capacity and service quality. The main drivers of the current National Grid development plan are as follows:

• Raise transmission capacity to handle the increase in electricity consumption. The growth of electricity consumption in Portugal stimulated by economic growth, the convergence with European living and comfort standards, and specific large-scale infrastructure projects such as the high-speed rail lines or Lisbon’s new international airport, means additional electricity transmission capacity is needed.
• The need for connections to new standard and special regime power plants. Portuguese and European energy policy goals have led to the construction and integration into the national electricity system of high levels of new renewable power generation capacity, most of which is located in inland regions of the country, and has resulted in the need to reinforce the National Grid so that it can carry that generated power to the consumption centres. For example, it is expected that installed wind capacity, which was virtually zero in 2000, will continue to increase from the current level of around 3700 MW to 7000 MW by 2020. Also several large hydroelectric plants of the National High Potential Hydroelectric Dams Programme mean that similar reinforcement is needed.
• Increase interconnection capacity with Spain. Following the goals set under MIBEL, to increase interconnection capacity significantly and thereafter to hold joint studies with Spanish counterpart REE, the minimum interconnection capacity will continue to be raised in the medium term, from the current 1300 MW to about 3000 MW by 2014, through the construction of two new 400 kV interconnections, in addition to the internal strengthening by the National Grid and by the Spanish Grid. These increases are one of the key measures introduced by MIBEL, bringing electricity prices throughout the Iberian Peninsula into a broad balance.
• Renew equipment at the end of its service life. This is another planning decision category, arising from the need to replace equipment at the end of its service life or to change or improve old equipment in order to improve reduction of various kinds of environmental impact, particularly in the proximity of high density and occupancy population clusters.