Annual Report - EDP

notes to the EDP consolidated - Energias de Portugal, and company S.A. financial statementsfor the years ended 31 december 2012 and 2011Notes to the Consolidated and Company Financial Statementsfor the years ended 31 December 2012 and 2011During 2011, as a result of tax legislation changes in Spain and of corporate restructures of EDP’s Spanish fiscal group of subsidiaries, EDP re-estimated the futurerecovery of tax losses and credits brought forward which led to the recognition of deferred tax assets in the amount of 70 millions of Euros.The caption Difference between tax and accounting gains/losses mainly reflects the tax impact of the conclusion of the secondary public distribution offer for thedistribution of EDP - Energias do Brasil, S.A.'s ordinary shares.The effective income tax rate for the EDP Group and EDP, SA is analysed as follows:GroupCompanyThousands of Euros Dec 2012 Dec 2011 Dec 2012 Dec 2011Profit before tax 1,464,692 1,592,357 741,326 612,198Income tax -282,537 -260,378 91,356 173,606Effective income tax rate 19.3% 16.4% -12.3% -28.4%17. PROPERTY, PLANT AND EQUIPMENTThis caption is analysed as follows:GroupCompanyThousands of Euros Dec 2012 Dec 2011 Dec 2012 Dec 2011Cost:Land and natural resources 175,796 176,310 74,569 75,026Buildings and other constructions 654,384 551,944 93,556 95,906Plant and machinery:Hydroelectric generation 8,866,085 8,036,060 254 254Thermoelectric generation 7,672,378 7,752,912 - -Renewable generation 11,565,234 10,899,201 - -Electricity distribution 1,360,638 1,990,302 - -Gas distribution 1,136,865 1,100,039 - -Other plant and machinery 121,409 114,955 182 165Other 809,611 775,526 117,155 109,323Assets under construction 2,784,191 2,731,386 26,747 12,43235,146,591 34,128,635 312,463 293,106Accumulated depreciation and impairment losses:Depreciation charge -1,030,086 -1,019,320 -14,000 -11,154Accumulated depreciation in previous years -13,147,618 -12,390,019 -89,894 -81,203Impairment losses -54,131 -5,058 - -Impairment losses in previous years -9,416 -5,925 - --14,241,251 -13,420,322 -103,894 -92,357Carrying amount 20,905,340 20,708,313 208,569 200,749The movements in Property, plant and equipment, for the Group, for the year ended 31 December 2012 are analysed as follows:PerimeterBalance at Acquisitions/ Disposals/ Exchange Variations/ Balance atThousands of Euros 1 January Increases Write-offs Transfers Differences Regularisations 31 DecemberCost:Land and natural resources 176,310 3,987 -586 2,643 -7,963 1,405 175,796Buildings and other constructions 551,944 983 -3,989 149,309 -44,505 642 654,384Plant and machinery 29,893,469 38,453 -124,274 1,215,204 -296,607 -3,636 30,722,609Other 775,526 28,111 -36,615 48,273 -3,118 -2,566 809,611Assets under construction 2,731,386 1,601,467 -6,994 -1,477,183 -63,675 -810 2,784,19134,128,635 1,673,001 -172,458 -61,754 -415,868 -4,965 35,146,591Charge /PerimeterBalance at Impairment Disposals/ Exchange Variations/ Balance atThousands of Euros 1 January losses Write-offs Transfers Differences Regularisations 31 DecemberAccumulated depreciation andimpairment losses:Buildings and other constructions155,315 15,836 -3,926 - -7,731 575 160,069Plant and machinery12,699,358 990,512 -117,152 -58,140 -50,723 -2,591 13,461,264Other 565,649 77,869 -21,188 -56 -2,468 112 619,91813,420,322 1,084,217 -142,266 -58,196 -60,922 -1,904 14,241,251Acquisitions / Increases include the investment in wind farms by the subgroups EDPR Europe and EDPR North America during 2012. Additionally, the EDPR EUsubgroup carried out investments related with the construction of the solar photovoltaic plants in Romania. The subgroup EDP Brasil carried out investments relatedwith the coal power plant Porto de Pecém and with the hydroelectric plant Santo Antônio do Jari. In the Portuguese generation activity, the Group is carrying outhydroelectric investments in the construction of several new power stations and power enhancement projects.Charge / Impairment losses includes 53,401 thousands of Euros on wind generation assets in United States of America and Spain (see note 13), and 22,499thousands of Euros regarding the depreciation of Setúbal thermoelectric power plant, up to its recoverable amount, following the decision to terminate of theoperation at 31 December 2012.EDP - Annual Report 2012203