Annual Report 2011 - Elia

Annual 

Report 2011 

A responsible company 

serving its customers and the community 

in Belgium and Germany

Table of content 

EXECUTIVE REPORT 

Foreword* 2 

Profile and values 4 

Key events 2011* 6 

Prospects and challenges 2012* 12 

The Elia share in 2011 14 

ECONOMIC REPORT 

Grid operation 24 

Infrastructure 28 

Investments 29 

The Elia grid in Belgium 30 

The 50Hertz Transmission grid in Germany 33 

Grid maintenance 34 

Market operation 36 

Preventive management of critical grid situations 40 

Preparing for the future: research and development* 43 

ENVIRONMENTAL REPORT 

Environmental objectives and indicators 50 

SOCIAL REPORT 

Staff policy 64 

Knowledge management 68 

Employee safety and welfare 70 

Corporate social responsibility 74 

Stakeholder relations 77 

CORPORATE GOVERNANCE STATEMENT 

Composition of management bodies* 84 

Significant events in 2011* 87 

Remuneration of the Board of Directors 

and Management Committee* 92 

Features of the internal control and risk management systems* 96 

Description of the risks and uncertainties facing the company* 101 

FINANCIAL REPORT 

Consolidated financial statements IFRS* 108 

Notes to the consolidated financial statements* 113 

Joint auditors’ report on the consolidated financial statements 154 

Regulatory framework and tariffs* 156 

Information about the parent company* 160 

GRI Index 163 

Reporting parameters 165 

*These chapters form the annual report cf. article 119 of the Belgian company code.

51˚30' 

51˚20' 

51˚10' 

51˚00' 

50˚50' 

50˚40' 

50˚30' 

50˚20' 

50˚10' 

50˚00' 

49˚50' 

49˚40' 

49˚30' 

2˚30' E. Greenwich 2˚40' 2˚50' 3˚00' 3˚10' 3˚20' 3˚30' 3˚40' 3˚50' 4˚00' 4˚10' 4˚20' 4˚30' 4˚40' 4˚50' 5˚00' 5˚10' 5˚20' 5˚30' 5˚40' 

5˚50' 6˚00' 6˚10' 6˚20' 6˚30' 6˚40 6˚˚50' 

7˚00' 

B LIG HB ANK 

GEERTRUIDENBERG 

C B R S ocolie 

NAVAGNE 

THOR NTONB ANK 

B E R NE AU 

LIXHE 13 

E louges 

HE IMOLE N 

IJ zer 

TE R TR E 

150 + 30 

30(150) 

G HLIN 

AIR 

C . S t-G HIS LAIN LIQUIDE 

P E TIT MAR AIS 

B AUDOUR 

16 

70(150) 70(150) 

B ous s u 

Grid Elia 

70(150) 70(150) 

1 : 150 000 

K OK S IJ DE 

S t.-P AUWE LS 

S t.-Niklaas 

150+70 150+70 

WALG OE D 

150 + 70 J E MAP P E S 

P âturages 

Noords chote 

Tems e 

ZANDVLIET 4 

NOOR DLAND 

5 

ZANDVLIE T 

2 P OWE R 

B AS F 

MERCATOR 

11 55 0 0 +7 +7 00 

DOEL 

70(150) 70(150) 

22 

3dP 

2 

380+150 380+150 

K E TE NIS S E 

B E VE R E N 

70(150) 

Mons 

C iply 

150 150 + + 36 36 

22 

S C HE LLE 

Mais ières 

2 

3dP 

S OLVAY 

Mons anto 

Degus s a 

LILLO 

150 150 + + 36 36 

22 

9 

K ALLO 

+70 +70 

150 150 

70(150) 70(150) 

Hoboken 

B AY E R 

FINA 

E S S O 

MHO 

OB OUR G 

OOR DE R E N 

7 e HAVE NDOK 

BRABO 

33 

C . ZWIJ NDR E C HT 

3dP 

S C HE LLE DOR P 

S C HELDELAAN 

70 70 + + 150 150 

VILLE /HAINE 

150 150 + + 70 70 

150 + 70 

HAR MIG NIE S 

E s tinnes 

Wilrijk 

150 150 + + 70 70 

MOR TS E L 

Aarts elaar K ontich 

7 

E K E R E N 

ME R K S E M 

ZWIJ NDR E C HT 

DAMP LE IN 

B elliards tr. 

Oever 

Hoveniers tr. 

B UR C HT 

Tabakves t 

22 

1 : 150 000 

P E TR OL 

Wilrijk IS VAG 

150 + 70 

Moons tr. 

22 

2 

1 5 0 +7 0 

1 5 0 +7 0 

150 + 70 

NOOR DE R DOK K E N (NMB S ) 

33 

150+70 

MAR QUAIN 70(150) 

22 

3dP 

2 

150 + 70 

2 

150 + 70 

ZUR E NB OR G 

B erchem (NMB S ) 

WAAR LOOS 

E scaut 

MAR C HE -LE Z-E C AUS S INNE S 

C HAMP -DE - 

C OUR R IE R E 

B OE L 

LL 

TR IVIE R E S 

1 5 0 +7 0 

P E TR OC HIM 

B OE L 

FOUR 

70(150) 

La Louvière 

P E R ONNE S 

LA C R OY E R E 

B OE L TC C 

B OE L HF 

B INC HE 

2 

B otermelk 

WOMME LG E M 

LINT 

22 

1 

OE LE G E M 

FE LUY 

LIE R 

B UIS S E R E T 

70(150) 70(150) 

CENTRALE 

SENEFFE 

S eneffe 

B AS C OUP 

Leie 

P iéton 

(S NC B ) 

Anderlues 

GOUY 

Fontaine 

l’E vêque 

3dP 

S chelde 

Dendre 

Liberchies 

G OS S E LIE S 

Dender 

St-AMAND 

AME R C Œ UR 

TERGNEE 

C E NTR ALE 

G illy 

MAR C INE LLE 

C S MAR C INE LLE 

DAMP R E MY 

F. DE FE R 

C AR AL 

B LANC HIS S E R IE 

FOC 

C harleroi 

LA P R AY E 

FOUR 

LA P R AY E 

FAR C IE NNE S 

P ONT-DE -LOUP 

5 

Marchienne 

220 + + 150 

MALFALIS E 

COURCELLES 

22 

70(150) 

12 

3dP 

3dP 

70(150) 

3dP 

70(150) 70(150) 

150 150 + + 70 70 

MONC E AU 

22 

70(150) 70(150) 

70(150) 

70(150) 70(150) 

J umet 

70(150) 

150 + 70 

70(150) 

Heppignies 

(30) s ud 

MONTIG NIE S 

2 

150 + 70 

150 + 70 

C has s art 

70(150) 

70+30(150) 

70+30(150) 

FLE UR US 

150 

+ 

70 

3dP 

3dP 

Marbais 

(S NC B ) 

2 

S ombreffe 

AUVE LAIS 

3dP 

3dP 

K eumiée 

70(150) 

15 0 +36 

150 + 36 

S LIJ K E NS NOOR DE DE 

C . P las s endale 

B R UG G E 

EEKLO NOORD 

E E K LO 

Zelzate TJ 

C . K NIP P E G R OE N 

S C HELDE- 

K ALLO 

LAAN 

ME R K S E M 

B E VE R E N 

DAMP LE IN 

OE LE G E M 

ZWIJ NDR E C HT 

ZUR E NB OR G 

B UR C HT 

WOMME LG E M 

S t.-P AUWE LS 

P E TR OL 

2 

MASSENHOVEN 

P OE DE R LE E 

Olen 

Herentals 

MOL 

B ALE N 

LOMME L 

NY R S TAR 

MHO 

S t.-Huibrechts -Lille 

OVE R P E LT 

70 (150) 

Overpelt 

Infrax 

6 

S IDMAR 

S t.-Niklaas 

MOR TS E L 

Nijlen 

ZE DE LG E M 

AALTE R 

S ADAC E M 

NEST 

LANG E R B R UG G E 

RODENHUIZE K E E R K E N 

BAEKELAND 

2 K E NNE DY LAAN 

HE IMOLE N 

WALG OE D 

Tems e 

MERCATOR 

S C HE LLE 

-DOR P 

LIE R 

LINT 

Herenthout 

G eel/Oevel 

HE ZE 

MEERHOUT 

Hechtel 

G erdingen 

VAN EYCK 

Maas eik 

B E E R S T 

HORTA R ING VAAR T 

G E NT R E C HTE R OE VE R 

P AP IE R FAB R IE K 

2 

NIE UWE VAAR T 

HAM 

DR ONG E N 

FLOR A 

LOK E R E N 

ZE LE 

S t.-G ILLIS - 

DE NDE R MONDE 

Oudegem 

Hamme 

7 

Duffel 

B ornem 

S IDAL 

Willebroek 

BUGGENHOUT 

LE E S T 1 ME C HE LE N 

B aas rode 

M echelen 

MALDE R E N Tis s elt 70(150) 

-NMB S 

HE IS T/B E R G 

Langveld 

P UTTE 

K R UIS B AAN 

AMOC O 

E S S OC HE M 

HER C ULES 

Dowchemical 

TIP 

TES S ENDER LO 

C . TE S S E NDE R LO 

B E R ING E N 

2 

11 

HOUTHALE N 

Opglabbeek 

C.DILSEN 

B ekaert 

S TADE N 

WE S TR OZE B E K E 

IE P E R NOOR D 

IE P E R 

B as -Warneton 

[Neerwaas ten] 

P ITTE M 

B E VE R E N 

TIE LT 

M U IZ E L AAR 

R UMB E K E 

C . Izegem 

S t.-B AAFS -VIJ VE 

OOS TR OZE B E K E 

IZEGEM 

DE S S E LG E M 

HAR E LB E K E 

P E K K E 

K UUR NE 

HE ULE 2 B ekaert 

K ortrijk K ortrijk 

-NMB S Oos t 

ME NE N 

70(150) 

WE S T WE VE LG E M 

ZWE VE G E M 

MOE N AVELGEM 

MOUS C R ON 

[MOE S K R OE N] 

DE INZE 

WOR TE G E M 

R UIE N 

G avere 

Zottegem 

S t.-Denijs -B oekel 

OUDE NAAR DE 

G eraards bergen 

R ons e 

[R enaix] 

Muizen 

Aars chot 

WES PELAAR 

TE R LINDE N 

ME R C HTE M 

AALS T NOOR D 

C . VILVOOR DE 

Amylum 

2 

WIJ G MAAL 

AALS T 

VERBRANDE BRUG 

HOENDER VELD 

150 + 70 

G R IMB E R G E N 3 

K OB B E G E M 

WINK S E LE 

MAC HE LE N 

Welle 

K es s el-lo 

E s s ene 

R E LE G E M 

WILS E LE 

ZAVE NTE M 

2 

Denderleeuw 

S C HAAR B E E K 

P ellenberg 

(NMB S ) 

HAR E NHE IDE 

BRUEGEL MOLE NB E E K 

Leuven 

(NMB S ) 

HE LIP OR T 

G a s thuis berg 

DILB E E K 

C HAR LE S -QUINT 

Heverlee 

WIE R TZ 

Q. DE ME TS K . 

NINOVE WOLUWE -S t-LAMB E R T 

P AC HE C O DHANIS S t.-LAMB R E C HTS -WOLUWE 

ZUID/MIDI 

E IZ E R IN G E N 

Appelterre 

IXE LLE S 

DROGENBOS 

E LS E NE 

18 

FOR E S T 

VOR S T 

Herfelingen 

LAB OR E LE C 

MEKINGEN 

B UIZING E N S t.-GENES IUS -RODE 

Dorenberg 

L ummen 

DIE S T 

Halen 

K ers beek 

TIE NE N 

S t.-Truiden 

Ors maal 

Landen Landen 

-NMB S 

E IS DE N 

Zonhoven 

S TALE N 

P aals teens tr. 

C . LANG E R LO 2 

Maas mechelen 

LANG E R LO 

Has s elt 

S IK E L 15 2 

G ODS HE IDE 

ALZ 

(NMB S ) 

150(380) 

16 

ZUTE NDAAL 

FOR D 

70(150) 

S AP P I 

B ilzen 

Lanaken 

Alken 

B R US TE M 

HE R DE R E N 

B orgloon 

Tongeren 

LIXHE 

NAVAGNE 

B E R NE AU 

DOTTIG NIE S 

[RHODE-S t-GENÈS E] 

[DOTTE NIJ S ] 

Deux-Acren 

E nghien (S N C B ) 

[E dingen (NMB S )] 

WATE R LOO 

B AS S E -WAVR E 

J odoigne 

AVE R NAS 

2 

WARANDE 

CHEVALET 

3dP 

3 8 0 + 2 2 0 

2 

ZE E B R UG G E 

3 

HE R DE R S B R UG 

B LAUWE TOR E N 

AVELIN 

STEVIN 

2 

B landain 

MASTAING 

Tournai 

ANTOING 

Tournai 

-S NC B 

G AUR AIN 

C arrière 

du Milieu 

THIE ULAIN 

WATTINE S 

Harchies 

LIG NE 

Thumaid e 

Quevaucamps 

B AUDOUR 

Ath 

(S NC B ) 

C HIÈ VR E S 

E louges 

Mes lin 

Lens 

AIR LIQ. 

TE R TR E 

G HLIN 

P E TIT MAR AIS 

P âturages 

OB OUR G 

Hoves 

C iply 

HAR MIG NIE S 

S oignies 

Fourmies 

R onquières 

B raine-le-C . 

B raine-le-C omte 

-S NC B 

MAR C HE -LE Z- 

É C AUS S INNE S 

Momignies 

380 + 150 

Lobbes 

S olre-S t-G éry 

C LAB E C Q 

OIS QUE R C Q 

P E TR OC HIM 

C HAMP -DE - 

FE LUY 

C OUR R IÈ R E 

CENTRALE SENEFFE 

V/HAINE 

BORSSELE 

NOOR DLAND 

TR IVIÈ R E S 

P É R ONNE S 

LA C R OY È R E 

B AS C OUP 

B INC HE 

KREEKRAK 

DOEL 

K E TE NIS S E 

ZANDVLIET 

B AS F 

Lobbes 

-S NC B 

150 150 + + 70 70 

220+150 

2 

R upel 

B aulers 

-S NC B 

B aulers 

GOUY 

LILLO 

THUILLIE S 

ZANDVLIE T 

P OWE R 

B AY E R 

BRABO 

FINA 

E S S O 

C lermont 

2 

Froidchapelle 

NIVE LLE S 

C himay 

12 

C E NTR ALE 

MAR C INE LLE 

G embloux 

J E ME P P E - 

S OLVAY 

3dP 

P LATE -TAILLE 

E au 

d’Heure 

Fos s es -la-Ville 

2 

2 

2 

G OS S E LIE S 

K almthout 

220+150 

Sambre 

S ambre 

2 

Dyle 

FLE UR US 

Thy-le-C hâteau 

Ottignies (S NC B ) 

C ouvin 

C eroux 

G erpinnes 

Hanzinelle 

B recht 

C ourt-S t-É t. 

AME R C Œ UR TERGNEE 

LA P R AY E 

FOUR 

DAMP R E MY 

FAR C IE NNE S 

MONC E AU 

E K E R E N 

7 e HAVE NDOK 

NOOR DE R DOK K E N 

(NMB S ) 

B R AINE -L’ALLE UD 

VIE UX 

G E NAP P E 

B AIS Y -THY 

COURCELLES St-AMAND 

MONTIG NIE S 

J AMIOLLE 

NE UVILLE 

S t.-J OB 

AUVE LAIS 

REVIN 

MAZURES 

LONNY 

VESLE 

2 

G UUT 

MALLE 

Dijle 

R omedenne 

380 + 150 

C OR B AIS 

70(150) 

S auvenière 

G embloux 

J E ME P P E - 

S OLVAY 

LUME S 

Meuse 

ME E R 

R ijkevors el 

B EER S E 

VIR E UX 

Echelle 1 : 1 000 000 

Schaal 

0 10 20 30 km 

Ourthe 

Situation au 

stand op 1-1-2012 

Meuse 

Vesdre 

Institut Géographique National Nationaal Geografisch Instituut 

2˚40' E. Greenwich 2˚50' 3˚00' 3˚10' 3˚20' 3˚30' 3˚40' 3˚50' 4˚00' 4˚10' 4˚20' 4˚30' 

4˚40' 4˚50' 5˚00' 5˚10' 5˚20' 5˚30' 5˚40' 5˚50' 

6˚00' 6˚10' 6˚20' 6˚30' 6˚40' 6˚50' 

G rote Nete 

380 + 220 

10 (70) 

S ambre 

B ois -de- 

Villers 

Warnant 

S ommière 

Has tière 

Demer 

12 (70) 

2 

Leuze 

Waret 

CHAMPION 

S t-S ervais 

Namur 

-S NC B 

Marche-les -Dames 

Namur 

2 

G rands -Malades 

Floriffoux 

K oekhoven 

G latigny 

Ais che-en-R efail 

C HOOZ 

COGNELEE 

Dinant 

2 

S art-B ernard 

(S NC B ) 

Y voir 

(S NC B ) 

Turnhout 

Wierde 

Dorinne 

S emois 

R avels 

Hannut 

Florée 

P ondrôme 

15 (70) 3dP 

2 

S E ILLE S 

C iney 

-S NC B 

C iney 

ACHÊNE ACHÊNE 

-SNCB 

Monceau-en-Ardennes 

Andenne 

B uis s onville 

Lesse 

Wanze 

150 + 70 

S aives 

S tatte GRAMME 

(S NC B ) 

Fays -les -Veneurs 

3dP 

3dP 

C roix- 

C habot 

Hatrival 

-S NC B 

3dP 

3dP 

3dP 

Hogne 

(S NC B ) Marche-en- 

Famenne 

Forrières 

(S NC B ) 

TIHANGE 

H te S AR TE 

Miécret 

On 

Orgeo 

3dP 

Vierre 

C hiny 

3dP 

AWIR S 

C LE R MONT 

C harneux 

Hatrival 

3dP 

3dP 

Fooz 

RIMIERE 

R ecogne 

70 (220) 

Neufchâteau 

Vierre 

380 + 150 

Ivoz 

3dP 

Ourthe 

3dP 

EINDHOVEN 

3dP 

3dP 

70(150) 

S E R AING 

Herbaimont 

3dP 

380 + 150 

Meuse 

LE VAL 

(C . S E R AING ) 

3dP 

3 

4 

B R E S S OUX 

J UP ILLE 

LA TR OQUE 

220 + 150 

C omblain 

S oy 

R es pelt 

B omal 

Longlier (S NC B ) 

MAR C OUR T 

Marbehan 

(S NC B ) 

C HE R TAL 

70 (150) 

Villers -s /S emois 

LATOUR 

S t-MAR D 

S t-MAR D 

-S NC B 

R OUVR OY 

3dP 

3dP 

3dP 

3dP 

150 + 70 

Mons in 

R OMS É E 

-S NC B 

R OMS É E 

3dP 

Maas 

P epins ter 

P epins ter 

-S NC B 

Heid-de- 

G oreux 

VILLE R OUX 

B ATTIC E 

Turon 

Amblève 

380 + 220(2 x 380) 

B AS TOG NE 

MONT S t.MAR TIN 

S oiron 

3dP 

Vesdre 

COO 

B R UME 

-S NC B 

Trois -P onts 

70 BRUME (220) 

380 + 220 

(2 x 380) 

MONT-LE Z-HOUFFALIZE 

AUBANGE 

HE INS C H 

Arlon 

-S NC B 

HE R S E R ANG E 

FIB E R 

Arlon 

MOULAINE 

150 + 70 

150+70 

Les P lenes s es 

S pa 

B ronrome 

B onnert 

LANDR E S 

MAASBRACHT 

Montzen 

(S NC B ) 

S tembert 

S ûre 

DODEWAARD 

G AR NS TOC K 

C ierreux 

Maas 

OBERZIER 

B OIS 

L'IMAG E 

Henri- 

C hapelle 

70(150) 2 

P T -R E C HAIN 

Welkenraedt (S NC B ) 

G ileppe 

G ileppe 

Ves dre 

B evercé 

B E R TR ANG E 

S aives 

TIHANGE 

MAR C HIN 

C R OIX-C HAB OT 

Les S pagnes 

GRAMME 

H te S AR TE 

Weser 

Warche 

Our 

Amps in- 

Neuville 

Amel 

S ankt-Vith 

[S aint-Vith] 

Differd. 

Arbed 

OXY LUX 

B elv. Arbed 

E S C H-S UR 

-ALZE TTE 

B E LVAL 

S C HIFFLANG E 

VIGY 

E UP E N 

S chif. 

R OOS T 

S tephans hof 

Amel 

[Amblève] 

FLE B OUR 

Alzette 

3dP 

3dP 

Hermalle 

s /Huy 

B ütgenbach 

[B utgenbach] 

HE IS DOR F 

Holzwarche 

VIANDE N 

S .E .O. B AULE R 

E hein 

Abée-S cry 

380 380 + + 150 150 

AWIR S 

C LE R MONT 

Nombre de ternes 

prévus ins tallés 

(avec numéro de référence dans 

le tableau des compos itions ) 

en cons truction ou en projet 

2 e terne en cons truction ou en projet 2 de draads tel in aanbouw of in ontwerp 

lignes à 2 ternes de 

tens ions différentes 

tens ion d’exploitation inférieure 

à la tens ion de cons truction 

ligne appartenant à un tiers (1) 

Tableau des compos itions des 

lignes à plus de 2 ternes : 

2 4 x 150 8 3 x 70 

3 1 x 150 + 2 x 70 (3 x 150) 

9 2 x 150 (4 x 150) 

4 1 x 150 + 3 x 70 (4 x 150) 

1 x 150 + 1 x 70 (2 x 150 + 1 x 70) 

5 

6 

NIEDER S TEDEM 

1 

2 

2 

> 2 

3dP 

1 2 x 150 + 1 x 70 (3 x 150) 

2 x 150 + 2 x 70 (4 x 150) 

2 x 150 (2 x 380 + 2 x 150) 

C AB LES S OUTER R AINS 

UNITES DE PR ODUC TION (2) 

C OUR S D’EAU 

(1) E lia décline toute res pons abilité concernant les données relatives aux ins tallations appartenant 

à des tiers . 

E lia wijs t alle verantwoordelijkheid af voor wat betreft data i.v.m. ins tallaties van derden. 

(2) S ont représ entées toutes les unités pour les quelles un contrat C IP U a été conclu avec E lia. 

S taan op de kaart alle productie-eenheden waarvoor met E lia een C IP U contract is afges loten. 

(C IP U = C ontract for Injection of P roduction Units ). 

Situation au 

Stand op 1-1-2012 

Moselle 

Fooz 

Voroux 

(S NC B ) 

centrale nucléaire 

centrale thermique 

centrale thermique en projet 

POS TES 

Hollogne 

3dP 

8 

Tilleur 

G rivegnée 

C . Angleur 

70(220) 

S E R AING Ferblatil 

J emeppe 17 

S cles s in 

P rofondval 

Ougrée K uborn 

LA TR OQUE 

LE VAL 

C hênée 

14 

Ivoz Flémalle (C . S E R AING ) 

S art-Tilman 

70kV 

3dP 

R ametVesdre 

1 

1 

2 

3dP 

LIGNES AER IENNES 

Tens ion d’exploitation 

380kV 

220kV 

150kV 

380kV 

220kV 

150kV 

70kV 

câbles en parallèle 

centrale de pompage 

centrale hydraulique 

parc d'éoliennes 

exis tant 

en projet 

avec injection de production 

380kV 

220-150kV 

70kV 

RIMIERE 

R ivières et canaux 

3dP 

70 (150) (150) 

Alleur 

Anthis nes 

3dP 

70 70 (150) (150) 

4 

150 + 70 

70(150) 

3dP 

3dP 

P ouls eur 

MERCATOR 

MOLE NB E E K 

Herbaimont 

S amens tellingtabel van de lijnen 

met meer dan 2 draads tellen: 

14 1 x 220 + 2 x 70 

15 3 x 150 (4 x 150) 

10 16 3 x 150 + 1 x 70 (4 x 150) 

11 4 x 70 

17 3 x 220 

12 3 x 150 

18 1 x 380 + 2 x 150 (2 x 380 + 2 x 150) 

2 

FN 

Vottem C HE R TAL 

Incin. Hers tal 

Hers tal 

3 

Vottem 

Mons in 

Ans 

B R E S S OUX 

G lain P ouplin 150 

+70 

J UP ILLE 

Montegnée 

16 

B E LLAIR E 

3dP 

3dP 

70 70 (150) (150) 

Ourthe 

E s neux 

R ivage 

(S NC B ) 

Aantal draads tellen 

voorzien uitgerus t 

1 1 

2 1 

2 2 

(met referentienummer in 

de s amens tellings tabel) 

ONDER GR ONDS E K AB ELS 

câble appartenant à un tiers (1) 3dP 

kabel eigendom van een derde (1) 

3dP 

> 2 

in aanbouw of in ontwerp 

lijn met 2 draads tellen 

van vers chillende s panningen 

uitbatings s panning lager 

dan de cons tructies panning 

lijn eigendom van een derde (1) 

7 3 x 380 (4 x 380) 13 1 x 70 (4 x 150) 

TR IE R 

3dP 

FN 

4 

70(150) 70(150) 

220 220 + + 150 150 

16 16 

PR ODUC TIE EENHEDEN (2) 

kerncentrale 

16 

thermis che c entrale 

thermis che centrale in ontwerp 

pompcentrale 

380kV 

220kV 

150kV 

70kV 

parallele kabels 

waterkrachtcentrale 

windmolenpark 

1 : 150 000 

S TATIONS 

bes taand 

in ontwerp 

met productie injectie 

380kV 

220-150kV 

70kV 

R OMS É E 

-S NC B 

R OMS É E 

Magotteaux 

70kV 

Vis é 

(S NC B ) 

Meuse 

WATER LOPEN 

R ivieren en kanalen 

150 150 + + 70 70 

C HE R ATTE 

B OVENGR ONDS E LIJ NEN 

Uitbatings Uitbatings s s panning 

panning 

380kV 

220kV 

150kV 

2 

51˚30' 

51˚20' 

51˚10' 

51˚00' 

50˚50' 

50˚40' 

50˚30' 

50˚20' 

50˚10' 

50˚00' 

49˚50' 

49˚40' 

49˚30'

About this report 

At a time when the European electricity 

system is evolving at an increasingly 

rapid pace, the Elia Group is fully 

committed to playing a leading role by 

harnessing and deploying creativity at 

all levels, including in international cooperation, 

engineering, grid development, 

system operation, market mechanisms 

and consultancy. 

This approach is based on actively 

listening to our customers, regulators, 

the political authorities and other system 

operators. It underlies a fair balance between 

profit for shareholders, welfare for 

people and preservation of the planet 

- Profit, People, Planet. This difficult and 

delicate balancing act is the only way to 

guarantee long-term success in the light 

of the major investments and innovation 

that the Elia Group and the power grid 

industry as a whole must deploy over 

the next two decades. 

There is no longer any doubt whatsoever 

that the energy challenges of the 21st 

century will give rise to a technological 

revolution – for power systems – whose 

scope and consequences will far exceed 

the impact of market deregulation 

begun 15 years ago. 

The 2011 Annual Report looks at what 

our 1,800 employees are doing in 

Belgium and Germany in their ongoing 

desire to meet the needs of our customers, 

develop our skills and take initiative. 

Our goal – yesterday, today and tomorrow 

– is to help ensure a secure electricity 

supply, improve the competitiveness 

of our businesses and the welfare of our 

citizens, and deliver a fair return for our 

shareholders. 

For the third year in a row, this is part of 

a GRI (Global Reporting Initiative) approach 

focusing on clarity and transparency. 

ELIA GROUP 2011 


The employees of the Elia Group, which is located in the heart of the European electricity 

market, work day and night to deliver high-quality electricity to homes, businesses and 

industries in Belgium and Germany – and to ensure security of supply. Providing this 

public utility service involves continually ensuring balance between energy produced and 

consumed, proactively adapting grid infrastructure in order to facilitate the transition to green 

energy and providing high-quality service at the best cost. 

1,800 

1 

The number of Elia Group 

employees, in Belgium and 

Germany, working around the 

clock to ensure the security 

and quality of the power supply 

to the public and industry.

2 



Foreword by the Chairman 

of the Board of Directors 

Against the backdrop of the earthquake 

in Japan, its terrible aftermath and signs 

of instability in several Gulf countries, 

questions – some of them fundamental 

– have been asked about the energy 

mix in a number of European countries, 

including Germany and Belgium. This 

questioning has been accompanied 

by increased awareness of the major 

role played by electricity transmission 

system operators in ensuring that the 

development of power generation facilities 

becomes a reality. 

The already significant development 

of variable renewable energies such 

as wind and solar power sped up as 

the EU and its Member States’ pledge 

to combat climate change and global 

warming, with the ultimate target of zero 

CO 2 emissions, was recently confirmed. 

However, such renewable energy 

sources are often located in geographic 

areas with little or no industry, as in the 

case of the major offshore wind farms 

in northern Europe and the large-scale 

photovoltaic plants to be constructed in 

southern Europe and North Africa. 

Therefore, new transmission facilities 

must also be built to transmit the power 

generated by those sources to major 

consumption centres in the centre of the 

continent. The variability of the energy 

sources calls for very high flexibility (in 

both directions) from other generation 

facilities, and access to storage facilities. 

No plans can be made for the develop- 

ment of hydropower plants and, more 

specifically, pumping stations without 

first commissioning transmission infrastructure 

capable of transporting large 

volumes of electricity all over Europe. 

The transition towards these new energy 

sources also entails the complete 

transformation of electricity systems 

and, more specifically, the development 

and management of power transmission 

and distribution systems. The grids of 

the future – whether offshore grids or 

onshore electricity highways – have yet 

to be developed, and specific aspects 

of those grids have yet to be invented, 

while their management will call for flexibility 

and a capacity for innovation and 

creativity similar to that underpinning the 

current electricity systems. 

Since its creation in 2001, the Elia 

Group – now one of the top five electricity 

transmission system operators in 

Europe – has consciously established 

itself as a leader. Its two core businesses, 

in Belgium and Germany, are at the 

forefront of market development mechanisms 

and play a pioneering role in the 

large-scale integration of wind power. 

Owing to its knowledge and expertise, 

the Group is ideally positioned to benefit 

from the opportunities that such future 

developments represent. 

The Elia Group’s desire and capacity 

to achieve its mission for its customers 

and the community at large can be 

demonstrated by any number of factors, 

not least: the extension of Elia’s mission 

to include the operation of the offshore 

grid in the North Sea; the stability and 

visibility provided by the tariffs for the 

2012-2015 period, approved by the 

Belgian regulator; positive changes in 

the German regulatory framework; and 

the knowledge garnered by the Group 

through its participation in the Atlantic 

Wind Connection project to build the 

first direct-current offshore grid along 

the East Coast of the United States. 

In this connection and on behalf of the 

entire Board of Directors, I want to extend 

my thanks and appreciation for the 

pioneering work carried out by Daniel 

Dobbeni at the helm of the Elia Group, 

culminating in its incorporation in the 

BEL 20 index in March 2012, and to the 

Presidency of the European Network 

of Transmission System Operators for 

Electricity (ENTSO-E). I would also like 

to wish the same success to Jacques 

Vandermeiren, who is due to take over 

the reins from Daniel Dobbeni in the 

second half of 2012. 

Luc Van Nevel 

Chairman of the Board of Directors

Foreword by the Chairman 

of the Management Committee 

The past 10 years at our company have 

seen a series of major developments, 

leading to the construction of the Elia 

Group as we know it today. Independent, 

impartial and dedicated to its 

customers and the community, Elia has 

two core businesses in Europe and is 

firmly focused on the progress and opportunities 

provided by the development 

of the European energy mix. The Group 

derives extra strength from the cultural 

diversity of both its staff and the environment 

in which it operates – a mixture 

of European, national and regional 

legislation, proven and prospective 

technologies, maturity and renewal, and 

the challenges of the future, which are 

truly opportunities for each and every 

one of us. 

Since its establishment in June 2001, 

Elia has developed into a thriving and 

dynamic company, as evidenced by the 

following milestones: its appointment 

as the electricity transmission system 

operator for Belgium and the entry of 

Publi-T into our shareholding structure 

(2002); its acquisition of the engineering 

company subsequently known 

as Elia Engineering (2004); its listing 

on the stock exchange, well received 

by the markets (2005); the establishment 

of the Belpex power exchange 

and market coupling between France, 

Belgium and the Netherlands (2006); 

the launch of the regional coordination 

centre Coreso in collaboration with RTE 

and National Grid (2009); its acquisition 

of 50Hertz Transmission in cooperation 

with its Australian financial partner IFM; 

the start of market coupling with nine 

countries (November 2010) using the 

Cosmos algorithm developed by Belpex 

and Elia; its acquisition of a stake in 

the first project to build a direct-current 

offshore grid along the East Coast of the 

United States (2011). In addition to these 

notable achievements, Elia’s tariffs are 

among the lowest in Europe – proof, 

if needed, that growth and efficiency 

can be combined for the benefit of our 

customers. 

All these initiatives are the result of a 

joint effort by every one of our employees, 

who work around the clock to 

ensure the safe and secure operation 

of the electricity system as well as its 

development to meet the expectations 

of our customers and the community. 

They also reflect our commitment to 

establishing a genuine internal electricity 

market which is both competitive and 

reliable, and our support for energy and 

climate policies in Europe generally and 

in Belgium, Germany and their respective 

regions in particular. 

Our day-to-day activities to ensure the 

safety of individuals and installations 

include what many consider to be the 

obvious – a constant and competitively 

priced power supply of unparalleled 

quality. 



By encouraging our employees and 

subcontractors to focus on this mission 

at all times we have, over the years, 

been able to establish ourselves as a 

driving force in Europe. 

3 

Developing this role is a more important 

aim for us now than ever before: 

over the coming decades, the energy 

landscape in Europe – and electricity 

grids in particular – will be completely 

revolutionised. To help us cope with this 

change, we intend to learn, innovate, 

experiment and cooperate. The Atlantic 

Wind Connection project demonstrates 

our desire to anticipate change and to 

get the Elia Group ready for action, for 

the benefit of our customers and the 

community at large in the countries 

where we operate. 

Our incorporation in the BEL 20 index in 

March 2012 represents another opportunity 

for the Group and also underlines 

the importance of our role and mission. 

I am convinced it will provide us with the 

means for continued growth through 

the development of high-performance 

offshore and onshore grids interconnecting 

generation and consumption. 

Daniel Dobbeni 

Chairman of the Management 

Committee

4 



Profile 

Elia Group 

Business Development 

Research & Development 

The Elia Group is organised around its two major transmission system operators: 

Elia in Belgium and 50Hertz Transmission in Germany. 

Elia, the Belgian transmission system 

operator, holds licences for its 380 kV to 

150 kV national grid and for its 70 kV to 

30 kV grids in Belgium’s three regions. 

50Hertz Transmission, one of Germany’s 

four grid operators and active in 

the northeast part of the country, is held 

jointly by Elia (60%) and Industry Fund 

Management (40%). 

The Elia Group is one of the top five 

transmission system operators in Europe 

and one of the top 15 in the world. 

It actively sets an example in terms of its 

independent outlook, of being a driving 

force behind the development of the 

European market, its commitment to 

ensuring security of supply and contributing 

to the integration of renewable 

energies. 

It operates under the legal entity Elia 

System Operator, a listed company 

(with a public float of 52.10%) whose 

core shareholder is Publi-T, a municipal 

holding company. It has nearly 1,800 

employees and helps ensure security 

of supply for 30 million consumers in 

Belgium and Germany. 

Elia Transmission 

50Hertz Transmission 

Given its strategic position at the crossroads 

between electricity markets in 

western, eastern and northern Europe, 

the Elia Group securely manages imports, 

exports and transits of electrical 

energy over its grids. It also plays a key 

role in directly and indirectly integrating 

national markets in the shareholder 

structure of APX-Belpex-Endex and 

EPEX (power exchanges), CASC.EU and 

EMCC (capacity auction offices), Gridlab 

(a training centre) and Coreso (the 

regional cross-border flow monitoring 

centre). The Elia Group provides its customers 

and local authorities with a range 

of consultancy and engineering services 

driven by in-house skills and expertise 

for very-high-voltage equipment, IT tools 

designed specifically for managing grids 

and market models. 

The Elia Group is a driving force in the 

construction of Europe’s future electricity 

superhighways (both offshore and 

onshore) and is involved in multiple international 

projects. In 2011, it acquired 

- via its subsidiary Eurogrid International 

- a shareholding in the Atlantic Wind 

Connection project to build the first 

direct current offshore grid off the East 

Coast of the United States. The expertise 

and skills acquired will be used to 

design and develop future offshore grids 

in the North Sea and the Baltic Sea to 

connect major wind farms. 

The Elia Group follows the rules on 

corporate governance and the corporate 

governance codes applicable to 

listed companies. Its approach incorporates 

respect for the environment and 

supports specific sustainable development 

policies at European, national and 

regional level. 

Elia System Operator has been quoted 

on the regulated Brussels Euronext 

market since June 2005.

Values 

“We are a team of professionals with the ambition to create shared wins for our 

customers and the community and to develop the European electricity market in a 

reliable, sustainable and efficient way.” 

This is the mission statement drawn 

up by Elia in 2008 and intended to give 

each and every employee in the company 

a clear view of our objectives and priorities. 

When reflected in the company’s 

values, it communicates the framework 

within which employees exercise and 

develop their activities within the Group 

and with respect to the outside world: 

entrepreneurship, integrity, empathy and 

responsibility. 

Shared company values 



Entrepreneurial, ethical, caring and responsible – 

these values underpin how we conduct our business 

and meet the Group’s objectives. 

5

6 

Key events 2011 

2011 was marked by a significant number of key events in both Belgium and Germany 

relating to the markets, the development of our grids, technology and Group management 

bodies. 

13 JANUARY 

EXTRAORDINARY GENERAL MEETING 

APPROVES EXPANSION OF BOARD OF 

DIRECTORS TO 14 DIRECTORS 

To better respond to changes in Elia’s 

activities and its shareholder structure, 

a proposal was made to expand 

the Board of Directors from 12 to 14 

members at an Extraordinary General 

Meeting of shareholders. The motion 

was passed. 

17 FEBRUARY 



COUPLING OF THE BELGIAN AND 

DUTCH INTRADAY MARKETS 

Elia and TenneT (the Belgian and Dutch 

transmission system operators respectively) 

and the Belpex and APX-Endex 

power exchanges introduced an implicit 

intraday capacity allocation system at 

the Belgian-Dutch border. This crossborder 

intraday market meets a real 

need on the part of stakeholders who 

want to continue trading electricity 

practically up to real time, especially 

given the integration of a growing share 

of renewable energy. 

22 MARCH 

EUROPEAN COMMISSION OETTINGER 

CELEBRATES MARKET COUPLING OF 

9 COUNTRIES 

Four months after the simultaneous 

launch of price coupling in 5 countries 

(CWE) and volume coupling with the 

Scandinavian countries (ITVC) (covering 

generation capacity of 1,800 TWh 

and some 60% of European consumption), 

the stakeholders met in Brussels 

to celebrate this key stage which, as 

European Energy Commission Oettinger 

stressed, sets an example for all of 

Europe. The following stages will involve 

the transition to the flow-based model 

and the extension to other countries. 

13 APRIL 

KING ALBERT II VISITS ELIA 

King Albert II visited the Elia site on 

Avenue de Vilvorde in the presence of 

Energy Minister Paul Magnette. The 

King, who is particularly interested in 

energy issues, visited the National Control 

Centre and the Edison high-voltage 

substation where demonstrations were 

organised for him. He also met with 

young Elia trainees. 

23 APRIL 

GRAMME-ACHÊNE 380 KV 

CONNECTION RESTORED 

The Gramme-Achêne 380 kV 

connection, which was damaged 

during the devastating storm on 14 

July 2010 and temporarily replaced by 

an emergency line, was restored a few 

weeks earlier than planned thanks to 

the committed efforts made by Elia and 

contractors.

Baltic 1 is the first German offshore wind 

farm in the Baltic Sea and has been 

connected to the 50Hertz onshore grid. 

The farm was officially opened by German 

Chancellor Angela Merkel. 

29-30 APRIL 

ELIA JOINS FORCES WITH 

WETENSCHAPSEXPO SCIENCES 

Expo Sciences, organised by Jeunesses 

Scientifiques de Belgique and Jeugd, 

Cultuur en Wetenschap, brings together 

students from around the country. The 

aim was to make even the youngest 

schoolchildren more aware of sciences 

and future careers in science. Elia 

organised a special competition. The 

Elia exhibit featured a mock-up, learning 

materials and expert explanations 

giving young people a chance to learn 

about the many activities and career 

opportunities at Elia. 

30 APRIL 

ANGELA MERKEL INAUGURATES 

BALTIC 1 

German Chancellor Angela Merkel 

inaugurated Germany’s first commercial 

offshore wind farm. Baltic 1 is located in 

the Baltic Sea, 16 km from the coastline, 

and is connected to the 50Hertz grid. It 

comprises 21 wind turbines with a total 

capacity of 50 MW. With this project, 

the Elia Group deployed the expertise 

– unique in Europe – that will contribute 

significantly to future developments in 

the North Sea and Baltic Sea. 

10 MAY 

TWO NEW DIRECTORS APPROVED 

BY ORDINARY GENERAL MEETING 

OF SHAREHOLDERS 

The Ordinary General Meeting of 

Shareholders approved the appointment 

of two new directors, Miriam 

Maes (independent director) and Steve 

Stevaert (further to a proposal by core 

shareholder Publi-T). It also approved 

the motion to renew the directorships of 

the 14 directors and the appointment of 

the auditors. 

16 JUNE 

GREENING TRANSPORTATION 

INFRASTRUCTURE FOR ELECTRIC 

VEHICLES LAUNCHED 

The Greening Transportation Infrastructure 

for Electric Vehicles project, 

sponsored by the European Union via 

the TEN-T (Trans-European Transport 

Network) plan, was launched in Copenhagen. 

Elia is part of a consortium 

which includes Austrian TSO Verbund, 

industrial partners, public services and 

ONGs. Objective: study the options and 

conditions for developing the infrastructure 

needed to support the sustainable 

use of electric vehicles. 

17 JUNE 

PILOT PROJECT ON 

HIGH-TEMPERATURE CONDUCTORS 

IN GÜSTROW 

50Hertz began practical experiments on 

the latest generation of high-temperature 

conductors used to transmit bigger 

capacities of current, in the Güstrow 

high-voltage substation pilot project in 

Mecklenburg-Pomerania. The results are 

promising for deploying this technology 

in the 50Hertz grid in response to rising 

loads. 

JUNE 



EUROPEAN BACKING FOR ELIA’S 

7 

LIFE+ PROJECT 

The European Commission agreed to 

subsidise for five years the LIFE+ project 

to manage woodland corridors around 

high-voltage lines in an environmentally 

sustainable way while respecting 

biodiversity. This innovative pilot project, 

which is also supported by the Walloon 

Region authorities, will be expanded to 

European scale by sharing knowledge 

with other European transmission system 

operators, i.e. a potential of around 

300,000 km of green corridors.

8 

27 JUNE 



INAUGURATION OF THE NEW 50HERTZ 

CONTROL CENTRE IN NEUENHAGEN 

50Hertz’s entire very-high-voltage grid 

in northern and eastern Germany is 

managed from its new, super-modern 

control centre in Neuenhagen, near Berlin. 

The inauguration of this extremely 

safe and secure control centre was 

attended by European Energy Commissioner 

Günther H. Oettinger and the 

State Secretary at the Federal Ministry 

for Economy and Technology, Jochen 

Homann. 

The centre plays a critical role in 

integrating large volumes of renewable 

energy. 

28 JUNE 

DANIEL DOBBENI APPOINTED 

CHAIRMAN OF ENTSO-E FOR 

A SECOND TWO-YEAR TERM 

ENTSO-E, the European Network of 

Transmission System Operators for 

Electricity, represents the 41 operators 

of a grid comprising more than 

300,000 km of overhead lines in 34 interconnected 

countries and over which 

electricity flows freely, from Portugal to 

Bulgaria and from Norway to Italy. The 

grid forms the foundation for the internal 

electricity market because it enables 

supply across Europe, promotes 

competition between suppliers and it 

enhances security of supply. ENTSO-E 

is responsible for drafting grid codes 

and the Ten-Year Network Development 

Plan for the Europe-wide transmission 

system. 

22 JULY 

PARTICIPATION IN 

ATLANTIC WIND CONNECTION 

Elia acquired - via Eurogrid International 

- a shareholding in the Atlantic Wind 

Connection project to develop the first 

direct current high-voltage offshore grid 

off the East Coast of the United States. 

In so doing, Elia has joined forces with 

Google, Marubeni, Good Energies and 

Atlantic Grid Development. Elia also 

signed a long-term consultancy contract 

with the project developer. 

EU Energy Commissioner Günther 

H. Oettinger officially opens the new 

50Hertz control centre in Neuenhagen. 

The centre is fitted out with state-ofthe-art 

technology to ensure safe and 

secure grid management. 

17 AUGUST 

FIRST HELIBORNE OPERATIONS 

ON LIVE LINES 

Heliborne operations on a live 380 kV 

line were carried out for the first time 

in Belgium on the Achêne-Lonny line. 

The main benefit was that the line could 

remain in service during the work. This 

is critically important given the major 

flows of energy that transit over the Elia 

grid. The purpose of the pilot project 

was to assess the feasibility of carrying 

out other heliborne operations on live 

lines in the future. 

26 AUGUST 

PHILIP HEYLEN JOINS ELIA BOARD OF 

DIRECTORS 

Following the resignation of Johan De 

Roo, who had sat on the Elia Board 

of Directors since 2001 on behalf of 

Publi-T, the Elia Board approved the 

appointment of Philip Heylen further to 

a proposal by core shareholder Publi-T. 

Philipe Heylen is the alderman for culture 

and tourism for the city of Antwerp.

LATE AUGUST 

VISION OF AN OFFSHORE GRID 

IN THE NORTH SEA 

Elia published its future vision of the 

development of an offshore grid in the 

North Sea. The concept was developed 

in consultation with the developers of 

wind farms off the Belgian coast and is 

based on the step-by-step development 

of an offshore grid offering benefits 

comparable to the onshore grid in terms 

of reliability thanks to its meshed structure, 

optimised investment and lower 

number of subsea cables running to the 

coast and connecting it to the onshore 

grid. 

31 AUGUST 

Live maintenance work: this 

pilot project is paving the way 

for alternative maintenance 

methods no longer requiring 

decommissioning. 

50HERTZ ORGANISES 4 th SECURITY 

OF SUPPLY CONFERENCE 

Nearly 200 representatives of the 

electricity industry, universities and associations 

met in Cottbus to attend the 

conference organised by 50Hertz on 

measures in order to safeguard security 

of operation in the light of the evolution 

of the energy sector, specifically the 

ongoing development of renewables. 

The conference was held against the 

backdrop of the consequences of Germany’s 

moratorium on closing down its 

nuclear power facilities. 

13 SEPTEMBER 

PUBLIC CONSULTATION FOR STEVIN 

The public consultation on the regional 

land-use plan for the Stevin 

project (upgrading the 380 kV grid 

between Zomergem and Zeebrugge) 

was organised at the initiative of the 

Flemish government’s Spatial Planning 

department. The plan was provisionally 

passed by the Flemish government. Elia 

will organise information sessions for all 

towns involved. 

22 SEPTEMBER 

CREG CONSULTS ON DRAFT 

TARIFF METHODOLOGY 

CREG launched a consultation on its 

draft decrees establishing calculation 

methods and tariff conditions for connecting 

to and accessing the grid for 

transmission purposes. 

30 SEPTEMBER 

AGREEMENT ON ELEANORE 

COOPERATION 

3E, Alstom Grid, CG, CMI, DEME Blue 

Energy, Eurogrid International (in which 

Elia holds 60% and IFM 40%) and SAG 

joined forces within the Eleanore project 

to jointly develop, operate and finance 

targeted projects in the North Sea, the 

Baltic Sea, the Celtic Sea and the Irish 

Sea. 

1 OCTOBER 



INTERNATIONAL COOPERATION IN 

SYSTEM OPERATION AND CONTROL 

In October 2011, the Netzregelverbund 

cooperative venture in grid management 

and control was launched with 

a test involving Danish transmission 

system operator Energinet.dk. Netzregelverbund 

aims to optimise the use of 

control energy while avoiding instances 

of activation in opposite directions in 

two zones. Following positive results 

in Germany, the initiative can now be 

implemented across national borders. 

9

10 

14 OCTOBER 



RENEWABLE ENERGY SURCHARGE 

FORECAST BY GERMAN TSOS 

In coordination with German regulator 

Bundesnetzagentur, 50Hertz and the 

three other German transmission system 

operators published their forecasts 

for the EEG renewable energy surcharge 

(as per Germany’s Renewable Energy 

Sources Act) for 2012. Forecast injections 

of renewable energy will result in 

a surcharge of approximately €15 billion 

for Germany. The surcharge, payable 

by end consumers to support renewable 

energy, will be 3.592 cents/kWh, 

slightly higher than in 2011 (3.530 cents 

per kWh). 

20 OCTOBER 

CONTRACT WITH SAUDI ELECTRICITY 

COMPANY 

A consortium comprising Elia, RTE 

International and Tractebel Engineering 

signed a framework contract with Saudi 

Electricity Company (SEC) to provide 

engineering consultancy services for 

the SEC Transmission division. These 

services encompass asset management 

and asset maintenance services, 

maintenance practices, asset performance 

management practices, grid 

system analysis practices and training 

practices. 

10 NOVEMBER 

RGI IN FAVOUR OF SUSTAINABLE 

GRID DEVELOPMENT 

System operators and environmental 

protection associations have joined 

forces in the Renewables Grid Initiative 

(of which the Elia Group is a founding 

member) to sustainably upgrade 

electricity systems in preparation for 

the wholesale integration of renewable 

energy. To that end, they jointly submitted 

the “European Grid Declaration on 

Electricity Network Development and 

Nature Conservation in Europe” to the 

European Energy Commissioner. 

13 NOVEMBER 

FEDERAL DEVELOPMENT PLAN 

FOR 2010-2020 APPROVED 

The 2010-2020 federal development 

plan for the transmission system submitted 

by Elia was approved by Energy 

Minister Paul Magnette. It was accompanied 

by an environmental impact 

assessment and was subject to a broad 

public consultation. 

17 NOVEMBER 

ALBERTO POTOTSCHNIG, 

DIRECTOR OF ACER, ATTENDS ELIA 

CUSTOMER DAY 

Every year, Elia organises a Customer 

Day where it focuses on informing customers, 

enhancing dialogue with them 

and intensifying exchanges on issues of 

interest to them. Two discussion panels 

led to especially valuable exchanges 

with André Pictoel, head of VREG, 

Alberto Potoschnig, head of the Agency 

for the Cooperation of Energy Regulators 

(ACER) and Dominique Woitrin, 

Technical Director at CREG.

24 NOVEMBER 

JACQUES VANDERMEIREN FUTURE 

CEO OF ELIA 

On 24 November the Elia Board of 

Directors approved the appointment of 

Jacques Vandermeiren, Chief Corporate 

Officer and Vice-Chairman of the 

Management Committee, as the future 

general manager and chairman of the 

Elia Management Committee. In the 

second half of 2012, Jacques Vandermeiren 

will succeed Daniel Dobbeni, 

who will continue to guide and support 

the Group’s European and international 

growth. 

30 NOVEMBER 

50HERTZ FULLY COMPLIES 

WITH ENTSO-E COMPLIANCE TEST 

Following a two-day Compliance 

Monitoring audit carried out by ENTSO- 

E at the 50Hertz control centre to test 

whether procedures comply with the 

standards defined in the Operation 

Handbook of the European Network 

of Transmission System Operators for 

Electricity, the German transmission 

system operator was declared to be 

100% compliant. This was the second 

time 50Hertz passed the test, after being 

the first TSO to be audited in 2008. 

DECEMBER 

50HERTZ TIGHTLY CONFINED 

FOLLOWING GERMAN MORATORIUM 

ON NUCLEAR ENERGY 

The German government’s decision 

to shut down eight nuclear reactors in 

March 2011 and to gradually phase out 

the remaining sites over the next 10 

years has significant repercussions on 

the operation of the German and European 

transmission system. The German 

TSOs, including 50Hertz, were faced 

with a drastic reduction in their room 

for manoeuvre, especially during the 

winter months. All steps had to be taken 

– enhanced coordination, appropriate 

operating methods, postponement of 

maintenance works, market-level work 

and suspension of generation unit overhauls 

– in order to ensure the stability of 

the transmission system and security of 

supply. 

Alberto Pototschnig, Director 

of the Agency for the Cooperation 

of Energy Regulators (ACER), takes 

part in a discussion panel at the Elia 

Customer Day. 

22 DECEMBER 



11 

APPROVAL OF TARIFFS FOR 2012-2015 

In Belgium, the Commission for Electricity 

and Gas Regulation (CREG) approved 

the proposal submitted by Elia 

in accordance with the CREG rules on 

electricity transmission tariffs for the 

period from 2012 to 2015 (inclusive). The 

tariffs were drawn up following consultation 

between the regulator and Elia in 

order to send appropriate tariff signals 

to the market players, for both injection 

and offtake, and to meet the company’s 

needs in terms of pursuing its mission.

12 



Prospects and challenges 2012 

The Elia Group is preparing for the challenges of the future by implementing a series 

of initiatives relating to both system operation or market integration and the development 

of new activities or the acquisition of new skills. 

Elia plans to develop a 

genuine meshed offshore 

grid in the North Sea. 

Tariffs for 2012-2015 

The electricity transmission tariffs for 

the period from 2012 to 2015 were approved 

by CREG in late December 2011. 

They send appropriate tariff signals to 

the market players, bearing in mind an 

increase in costs explained by external 

factors (inflation over four years, drop 

in income from transmission capacity 

auctions involving neighbouring 

countries, increase in control energy 

needs due to the growth in intermittent 

energy sources). This is accompanied 

by performance incentives for efficiency 

and replacement investments for Elia in 

order to maintain the quality of supply 

provided to our customers. 

Daniel Dobbeni will hand over 

the reins as CEO of Elia to 

Jacques Vandermeiren at the 

end of Q1 2012. 

Future vision for an offshore 

grid in the North Sea 

The transposition into Belgian law of the 

‘third package’ of European directives 

aimed at developing a single electricity 

market expanded Elia’s scope for 

involvement into the development of an 

offshore grid in the North Sea. Elia had 

anticipated the decision by publishing 

its vision for developing the first offshore 

grid in the North Sea offering benefits 

comparable to the onshore grid in terms 

of reliability. It also presented a cost/ 

benefit ratio that is more beneficial than 

individual connections for each wind 

farm by reducing the number of subsea 

cables to the coast and enabling better 

integration with other infrastructure 

projects off the Belgian coast. 

This concept, developed in consultation 

with the developers of wind farms 

off the Belgian coast, is currently 

being discussed with all of the project 

stakeholders with a view to specifically 

defining the construction of two 

offshore platforms and the connection 

of future wind farms in question as well 

as the financial and legal framework for 

this major project at both Belgian and 

European level. 

Ongoing cooperation with 

Elia subsidiary 50Hertz 

Transmission 

The Group’s priorities for 2012, in collaboration 

with financial partner IFM, are 

to continue the successful cooperation 

and the exchanges of expertise seen in 

2011, intensify bonds between teams, 

define a joint mission and deploy all 

efforts to ensure the Elia Group is in the 

lead group of European TSOs in terms 

of independence, innovation and commitment 

to building the transmission 

system of tomorrow.

Maintaining grid security: 

a growing challenge 

Rising energy exchanges between 

transmission systems in different countries 

following market liberalisation and 

fluctuating energy flows on transmission 

grids due to the growing share of 

renewable energy sources were already 

major challenges to secure network 

operation. 

Efforts to ensure security of supply 

were further complicated by the drop in 

generation capacity due to the German 

government’s decision to shut down its 

eight oldest nuclear reactors, as well as 

decisions by Germany, Switzerland and 

Belgium to decommission their nuclear 

facilities over the next two decades, 

while the construction of large production 

units is being postponed year after 

year. The Elia Group is particularly vigilant 

in this respect and helps to coordinate 

the activities of European TSOs. In 

this respect, it promoted the option of 

having its own storage and generating 

resources to cover its reserve energy 

needs. While this provision was not 

included in the law passed in December 

2011, Elia will continue to defend it. 

This project involves the construction of the first offshore 

grid along the East Coast of the United States. 

Integration of the European 

electricity market 

The Elia Group will continue its activities 

begun in 2006, when Belpex was created 

and trilateral market coupling was 

launched, to create a true European 

electricity market. The Group’s activities 

in 2012 will be guided by the implementation 

of the flow-based mechanism 

within the North-West regional market, 

the continued development of crossborder 

intraday markets and the active 

contribution to the production of framework 

guidelines from the European 

Commission. 

New interconnections 

The Elia Group aims to lead the way in 

developing infrastructure to ensure security 

of supply and the competitiveness 

of European companies. Examples: 

the interconnection between the grids 

operated by Elia in Belgium and National 

Grid in the UK, the direct current interconnection 

between the Elia grid and 

the Amprion grid in Germany to create 

a pilot project for the development and 

implementation of future European 

superhighways, the interconnection with 

Poland, the enhancement of interconnections 

with countries neighbouring 

Elia in Belgium and 50Hertz in northern 

and eastern Germany. 



International initiatives: 

Atlantic Wind Connection 

Eurogrid International, in which Elia 

holds a 60% stake, acquired a shareholding 

in the Atlantic Wind Connection 

project to develop the first high-voltage 

direct current offshore grid off the East 

Coast of the United States, thus joining 

forces with Google, Marubeni, Good 

Energies and Atlantic Grid Development. 

The decision to include the project in 

the portfolio of PJM (a regional transmission 

organisation) could emerge in 

2012-2013, moving the project into the 

concrete realisation phase. 

Transition in the Group 

leadership 

13 

When it approved in November 2011 the 

appointment of Jacques Vandermeiren, 

Chief Corporate Officer and Vice-Chairman 

of the Management Committee, as 

the future Chief Executive Officer and 

Chairman of the Elia Management Committee, 

the Board of Directors defined 

the conditions governing the optimum 

succession for all parties concerned by 

the success of the Elia Group. Jacques 

Vandermeiren will, in the second half 

of 2012, succeed Daniel Dobbeni, who 

will continue to make his experience 

available to the company and support 

the Group’s European and international 

development, especially within the decision-making 

bodies of its subsidiaries.

14 

The Elia share in 2011 

Overall, 2011 was a volatile and negative year for stock market indexes, mainly due to 

the crisis of confidence in the euro. However, the Elia share has continued to perform well. 

Now that the company is resolutely European 

in scope, the Group’s risk profile 

improved significantly, contributing 

to share stability throughout the year. 

With the exception of a brief upsurge 

to €32.33 in late May (following the 

announcement of Germany’s moratorium 

on nuclear power stations) and a 

brief drop to €27 in early August (first 

peak in the euro crisis), the share acted 

defensively. It should also be noted that 

the payment of a dividend of €1.40 on 

25 May 2011 did not have an impact on 

the share price. 

Price (€) 

32 

31 

30 

29 

28 



PRICE AND EXCHANGE VOLUME TRENDS IN 2011 

JAN 

FEB 

MAR 

APR 

The liquidity of the share rose by 64% 

(from 23,096 shares per day to 37,972 

shares per day on average), whereas 

it had grown by 115% in 2010. This is 

mainly due to the increase in the public 

float. 

The Elia share ended 2010 at €28.66. 

The price at the end of 2011 was 

€29.93, up 4.43%. If the dividend of 

€1.40 is taken into account, the share 

price rose 9.32% during the year. 

MAY 

JUN 

JUL 

AUG 

The lowest price in 2011 was €26.50 

on 9 August 2011 and the highest price 

was reached on 31 May at €32.33. 

Overall, in 2011 the Elia share outperformed 

the BEL 20 index by 23.63%. 

In fact the BEL 20 was down 19.2%. 

SEPT 

■ Price ■ Volume 

OCT 

NOV 

Volume (’000) 

DEC 

200 

180 

160 

140 

120 

100 

80 

60 

40 

20 

0

ELIA SHARE TRENDS COMPARED 

WITH THE BEL20 INDEX IN 2011 

115 

110 

105 

100 

95 

90 

85 

80 

75 

70 

125 

115 

105 

100 

95 

85 

75 

■ Elia ■ Bel20 

JAN FEB MAR APR MAY JUN JUL AUG SEPT OCT NOV DEC 

ELIA SHARE TRENDS COMPARED 

WITH ITS PEERS IN EUROPE IN 2011 



■ Elia ■ Tema ■ Red Electrica ■ National Grid ■ DJ Utility index 

JAN FEB MAR APR MAY JUN JUL AUG SEPT OCT NOV DEC 

15

16 



The Elia share has been performing 

well compared to other listed system operators 

since early 2008. 

With the exception of UK system 

operator National Grid (up 13.2%), 

Elia’s results were better than those 

of its listed counterparts: Spain’s Red 

Electrica (down 6.07%) and Italy’s Terna 

(down 17.6%). By way of comparison, 

the electricity sector as a whole was 

down 19.85% in 2011 (see previous 

Month Volume 

table). The Elia share has been performing 

well compared to other listed system 

operators since early 2008. 

With 60,355,217 shares issued, the 

market capitalisation represented 

€1,806,431,645 at the end of December. 

In 2011, 9,758,889 Elia shares in all were 

Closing 

price Price 

traded on the Euronext Brussels market, 

i.e. 35.9% of the freely tradable shares. 

The table below gives an overview of 

the monthly statistics for the Elia share 

on Euronext Brussels in 2011. 

Freefloat 

turnover 

Market 

capitalisation 

(daily average) Highest Lowest Rate In € m 

January 27,476 29.17 29.60 28.67 2.12 1,761 

February 30,604 28.46 29.20 28.27 2.25 1,718 

March 50,698 28.79 29.25 27.72 4.29 1,738 

April 19,194 29.95 29.95 28.80 1.34 1,808 

May 46,837 32.33 32.33 28.92 3.79 1,951 

June 31,733 29.45 31.91 28.54 2,57 1,777 

July 17,731 28.50 29.30 28.50 1.37 1,720 

August 34,180 30.45 30.45 26.50 2.89 1,834 

September 59,516 30.38 30.98 28.60 4.82 1,771 

October 66,998 29.35 30.59 29.00 5.18 1,771 

November 49,375 29.35 29.81 28.22 4.00 1,771 

December 16,642 29.93 29.93 28.30 1.29 1,806 

Year-to-date 37,972 29.93 32.33 26.50 35.93 1,806

Appointment of two liquidity 

providers for the Elia share 

In late 2009 Elia concluded a liquidity 

provider contract with KBC Securities 

and Banque Degroof, both of which are 

officially recognised by NYSE Euronext. 

These two financial institutions have 

been continually present in the order 

book for the Elia share since 1 December 

2009 and are involved in both sales 

and purchases. 

The Elia share and its codes 

SHARE INDEX 

On 31 December 2011, Elia’s share was 

included in the BEL Mid index. Elia’s 

weight on that date was 7.23%, ranking 

it fourth in the index. 

A sustainable and socially 

responsible company 

Elia was rated by Vigeo, an extrafinancial 

agency which analyses every 

company in six areas: 

• relations with customers/suppliers; 

• human rights; 

• environmental policy; 

• external social policy; 

• corporate governance; 

• human resources. 

The Elia share is also included in Kempen’s 

SNS SRI Universe and ASN Bank. 

Elia was also certified by ECPI, a ratings 

company specialising in corporate 

social responsibility (ESG (Environmental, 

Social & Governance) research) and 

obtained the ECPI Ethical EMU Equity 

label. 

Elia share 

on the market 



The Elia share is certified 

by several institutions for 

corporate social responsibility. 

Elia strips 

on the market 

Market Euronext Brussels Euronext Brussels 

Index BEL MID - 

Ticker ELI ELIS 

ISIN BE 0003822393 BE 0005597688 

Code Bloomberg ELI BB ELI BB 

Reuters code ELI BR ELI BR 

17

18 



SHAREHOLDER STRUCTURE 

Transparency 

regulations and 

disclosure of interests 

Under Belgian legislation on transparency, 

shareholdings of at least 5% (or 

a multiple of 5%) must be reported to 

FSMA and to the company in question. 

No transparency reports were sent to 

Elia in 2011. 

Shares % Shares % Votings rights 

Publi-T 27,383,507 45.37 45.37 

Publipart 1,526,756 2.53 2.53 

Arco Group 5,306,880 8.79 8.79 

Other free float 26,138,074 43.31 43.31 

Total 60,355,217 100.00 100.00 

Shareholder structure 

The shareholder structure of Elia System 

Operator SA as at 31 December 2011 is 

given above. 

Dividend 

On 28 February 2012, the Elia Board 

of Directors decided to propose at the 

general meeting of shareholders of 

15 May 2012, in accordance with the 

dividend policy and subject to approval 

of the profit appropriation by the annual 

general meeting of shareholders, a 

normal dividend of €88,7 million or €1.47 

per share (gross). This gives a net result 

of €1,1025 per share without VVPR strip 

and €1,1613 per share with VVPR strip. 

The following paying agents will pay out 

dividends to shareholders: Fortis Bank, 

ING Belgium, KBC-Bank/CBC Banque 

and Dexia Bank. Dividend payouts for 

shares held in a stock account will be 

settled automatically by the bank or 

stockbroker. Elia will pay out dividends 

on registered shares directly to shareholders.

Dividend policy 

Elia is obliged by its articles of association 

to pay out at least 85% of profit 

gained, after retaining 5% for the legal 

reserve. This represents a payout ratio 

of 81% of recorded profit. 

Following the introduction of multi-year 

tariffs, part of the net profit derived from 

offsetting decommissioning gains in the 

tariffs must be reserved under equity. 

As a result, the overall payout ratio fell 

slightly but this situation enhanced Elia’s 

(self-)financing capacity. 

Financial calendar 

Investors 

For any questions regarding the Elia 

share, please contact: 

Elia 

Investor Relations Department 

Boulevard de l’Empereur 20 

B-1000 Brussels 

Belgium 

Tel.: +32 2 546 72 39 

Fax: +32 2 546 71 80 

E-mail: bert.maes@elia.be 

29 february 2012 (8 a.m.) Publication of the 2011 annual results 

Early April 2012 Availability of the 2011 annual report 

15 May 2012 General meeting of shareholders 

15 May 2012 Interim statement for Q1 2012 

Late May 2012 Payment of 2011 dividend (coupon nr. 7) 

31 August 2012 (8 a.m.) Publication of half-yearly results for 2012 

15 November 2012 Interim statement for Q3 2012 



19 

Information about the Group (press 

releases, annual reports, share prices, 

disclosures, etc.) can be found on 

the Elia website www.elia.be in three 

languages (French, Dutch and English). 

Elia’s financial newsletter Investor News 

provides investors with up-to-date information 

about the company. Just sign 

up on the website to receive it electronically.

01 

Economic 

report 

In the face of the challenges posed by changes in 

the energy mix, the Elia Group – organised around 

its two TSO activities, Elia Transmission in Belgium 

and 50Hertz Transmission – is pursuing its role as a 

leading player in the sector in Europe by taking a raft of 

initiatives aimed at the integration of electricity markets 

and of renewable energy sources and at security of 

supply for its customers and the community. 



21

22 

ELIA 2010 


We have added another mechanism, 

not to cut costs this time, but rather to maximise 

the expenditure providing the best return for 

consumers. The aim is to encourage Elia to draw 

up an investment budget for the maintenance 

it undertook to carry out, with a focus on highquality 

power supply – and hence on consumers’ 

best interests. 

Providing incentives 

for sound business 

management 

“In the case of monopoly companies, 

i.e. companies with no competition, the 

regulator ensures that consumers get 

the best possible service at the best 

possible price. In other words, it has to 

see to it that the company’s outlay really 

suits the consumer. In this context, we 

believe that the introduction of incentive 

mechanisms could contribute to sound 

business management. 

Guido Camps 

DIRECTOR FOR PRICING AND ACCOUNT CONTROL, CREG 

“The ‘cost +’ tariff method we are 

applying is generally accepted by all 

regulators. The aim of the first incentive 

mechanism, applied during the 2008- 

2011 period, was to cut operational expenditure 

(OPEX) based on the premise 

that monopoly companies naturally tend 

to overspend. 

To that end, a target was set to reduce 

OPEX and pass on the first €25 million of 

savings to consumers and the next €25 

million to the company. 

That target was reached, and we can 

safely say that both parties – the regulator 

and the regulated company – are 

satisfied. 

“For the 2012-2015 tariff period, we will 

continue to apply the ‘cost +’ method 

and have retained the first mechanism 

on the same grounds as before. 

However, we have also added another 

mechanism, not to cut costs this time, 

but rather to maximise the expenditure 

providing the best return for consumers. 

“What kind of expenditure, you may 

ask? Grid infrastructure, has a very long 

lifespan. It represents the most significant 

cost factor in terms of investment, 

finance, amortisation and maintenance. 

With this in mind, we introduced the new 

incentive to encourage Elia to realise the 

maintenance investments it undertook 

to carry out, with a focus on high-quality 

power supply – and hence on consumers’ 

best interests. 

“To round off, I should point out that this 

mechanism is the result of an agreement 

between Elia and the regulator.”

Hans-Peter Erbring 

MANAGER RESPONSIBLE FOR OPERATING THE 50HERTZ ELECTRICITY SYSTEM 

With some 41% of wind power generation capacity 

in Germany installed within our control area, 50Hertz can 

justifiably be considered the ‘European champion’ of integrating 

renewables. On windy days, more than 9,700 MW of wind are 

injected into our control area. 

“As a power transmission system 

operator responsible for managing 

the electricity system in northern and 

eastern Germany, 50Hertz has unique 

experience in integrating power generated 

from renewable energy sources. 

With some 41% of wind power generation 

capacity in Germany installed 

within our control area, 50Hertz can 

justifiably be considered the ‘European 

champion’ of integrating renewables. 

Exchanges with neighbouring countries 

are intensifying and constantly 

changing based on the ever-increasing 

volumes of renewable energy. 

On windy days, more than 9,700 MW of 

wind power – equivalent to the electricity 

generated by nine nuclear power 

stations – are injected into our control 

area. When demand in our area is low, 

this energy (which is given priority in 

line with European directives) must 

James Matthys-Donnadieu 

HEAD OF THE EUROPEAN MARKET INTEGRATION DEPARTMENT 

be safely transported to south-east 

Germany. One of the many roles of 

the control centre is to ensure safe 

transmission in real time, a task made 

even more challenging by the gradual 

closure of nuclear power stations. The 

number of critical situations on the grid 

and measures taken to resolve them 

has grown considerably.” 

Intraday markets are becoming increasingly important for 

the technical and economical operation of the electricity system 

due to the growth in power generation from more variable 

renewable energy sources. 

“Intraday markets are a tool used by 

market players to buy and sell electricity 

in the space of a given day, ideally 

at any time and as close as possible to 

physical delivery. This enables them to 

balance their generation and consumption 

portfolios at the lowest possible 

cost, based on (unforeseen) variations 

due to weather – in the case of wind 

power, for example – or the breakdown 

of a particular generation unit. Intraday 

markets are becoming increasingly 

important due to the growth in power 

generation from more variable renew- 

able energy sources such as wind or 

solar power. 

The cross-border intergration of Member 

States’ electricity market, through 

the transmission capacities, allows market 

players to access larger volumes of 

electricity at competitive prices with a 

view to balancing their portfolios. 

The Belgian and Dutch intraday markets 

have been successfully integrated since 

February 2011. In March 2012, this integration 

will be extended to all Scandi- 



23 

navian countries via the interconnection 

cable between the Netherlands and 

Norway. Belgian electricity suppliers will 

immediately benefit from an integrated 

intraday market running from Belgium 

to Finland. 

“The integration of intraday markets 

from the whole of North West Europe is 

scheduled for late 2012.”

24 



Belgium emerges, year on year, as one of 

the best countries in Europe in terms of quality 

of electricity supply. 

Grid operation 

The Elia Group’s grids are part of the European continental interconnected system 

running from Portugal to Bulgaria and from Norway to Italy. 

The Belgian and German control centres maintain an instantaneous balance between 

generation and consumption and manage energy flows in close collaboration with the 

transmission system operators from neighbouring countries. 

A number of factors are radically changing 

the centres’ role, leading to a need 

for increasingly sophisticated tools and 

skills: 

• increasing exchanges of energy 

between national electrical systems 

following market liberalisation; 

• the variability of energy flows on the 

transmission systems due to the 

growing share of energy generated 

by renewable, and intermittent, 

sources (especially wind energy and 

photovoltaic panels); 

• the reduction of generation capacity 

following the German government’s 

decision in March 2011, in 

the wake of events at Fukushima, to 

shut down its eight oldest nuclear 

reactors (with a generation capacity 

of some 8,000 MW, or more than 

two-thirds of total consumption in 

Belgium); 

• Germany, Switzerland and Belgium’s 

decision to abandon nuclear energy 

in the next two decades; 

• the growing share of energy generated 

by generation units connected 

to the distribution systems that do 

not contribute to management of the 

electrical system; 

• the postponement, year after year, 

of construction of large generation 

units due to the difficulties involved 

in obtaining permits and the uncertainties 

associated for example with 

the financial and economic crisis. 

Against this fast-changing backdrop, 

the Elia Group in cooperation with the 

operators of the interconnected grids is 

developing new skills and tools: 

• within a few months, 50Hertz and 

its three fellow German TSOs have 

used a wide range of means to deal 

with the reduction in voltage regulation 

tools in certain geographical 

areas and to increase transmission 

capacities including, when necessary, 

cancellation of maintenance 

work, with a view to optimising the 

stability of the electrical system and 

security of supply; 

• Elia, coordinating with the FPS Energy 

and the Federal Crisis Centre, 

has set out coordinated measures 

that will be taken in the event of a 

power shortage; 

• an intraday adjustment mechanism, 

enabling the market players to align 

their level of generation with their 

customers’ consumption throughout 

the day, was introduced in collaboration 

with Dutch TSO TenneT and 

the Belgian power exchange Belpex 

and its Dutch counterpart APX- 

Endex; 

• on the initiative of Elia and the 

Coreso coordination centre, the 

phase-shifting transformers of 

Amprion in Germany, TenneT in the 

Netherlands and Elia are managed in 

a coordinated way so as to shore up 

the commercial capacities allocated 

to the market players and increase 

security of supply. 

However, these measures, some of 

which are temporary in nature, are no 

substitute for the new generation and 

transmission facilities units required 

in Belgium and Germany to cover the 

demand for electricity.

2’19’’ 

Spread across all customers, 

the average duration of 

interruptions was 2 minutes 

and 19 seconds per customer 

(Average Interruption Time). 

Security of supply 

Security of supply in Belgium remained 

at a high level in 2011. The average 

number of interruptions on the Elia grid 

per consumer (Average Interruption 

Frequency) was 0.0903, equivalent to 

one interruption per customer every 

7.8 years. 

The average duration of interruptions 

was 25 minutes and 44 seconds. 

Spread across all customers, the 

average duration of interruptions was 

2 minutes and 19 seconds per customer 

(Average Interruption Time 1 ), equivalent 

to an average availability of more 

than 99.999%, which is higher than the 

average for the last decade. Belgium 

thereby emerges, year on year, as one of 

the best countries in Europe in terms of 

quality of electricity supply. 

In Germany, the integration of an even 

higher proportion of renewable energy 

was the main challenge for operational 

security. Special measures, stipulated 

by German legislation (Article 13 of the 

Energy Industry Act (EnWG)), had to 

be applied more frequently because of 

critical situations due to extensive renewable 

generation (wind and photovoltaic 

energy). At least one of these measures 

had to be applied for some 213 days of 

the year. Thanks to close cooperation 

between 50Hertz Transmission and the 

other stakeholders in the electricity system 

and the expertise of the team at the 

control centre, no incidents or interruptions 

of supply were recorded in 2011. 

Security of supply 

Consumption 



Electricity consumption as recorded on 

Elia’s transmission system is a good 

indicator of economic life. It has been 

scrutinised very closely since the start 

of the economic crisis in October 2008, 

not only by the Elia Group, but also by 

external observers in search of signs of 

an economic recovery in Europe. 

1 The AIT is an indicator that can vary widely from year to year 

depending on the location and complexity of the incidents and 

the time at which they occur. Customers may experience very 

different power interruptions. As the number of incidents entailing 

interruptions is very limited, the annual overall figures cannot really 

be considered as valid statistics on which to base conclusions about 

the observed trends 

Thanks to close cooperation between 50Hertz 

Transmission and the other stakeholders in the 

electricity system and the expertise of the team 

at the control centre, no incidents or interruptions 

of supply were recorded in 2011. 

25

26 

CONSUMPTION INDICATOR 

GWh 

9000 

8000 

7000 

6000 

5000 

4000 

3000 

2000 

1000 

0 



JAN 

FEB 

Consumption indicator 

MAR 

In Belgium, the consumption indicator 2 

for the Elia control area fell by 3.7%, from 

86.6 TWh in 2010 to 83.4 TWh in 2011. 

On an annual basis, this consumption 

indicator reached its highest value in 

2005 (89.5 TWh). 

The monthly values recorded in 2011 

were down from the equivalent months 

in 2010, but were up on the equivalent 

months in 2009, except for September 

and October. 

Overall, consumption in 2011 was 0.5% 

lower than in 2010 for industrial customers 

connected directly to the Elia grid, 

and 5.1% lower for industrial, business 

and residential customers of the distribution 

system operators. 

2 The Elia consumption indicator covers most of the electricity 

consumption in Belgium. It includes all the generation capacity 

connected to the Elia grid, and the import-export balance. The 

share of consumption provided directly by the generation facilities 

connected to the distribution grids is not included in the indicator. 

APR 

MAY 

JUN 

Consumption peaks 

JUL 

In Belgium, the maximum consumption on 

the Elia grid in 2011 was 13,208 MW, recorded 

between 5.45 p.m. and 6 p.m. on 

11 January 2011. This is 5.9% lower than 

the all-time record, set on 17 December 

2007 (14,033 MW) and 4.6% lower than 

the maximum value recorded in 2010 

(13,845 MW on 1 December 2010). 

The lowest consumption (6,232 MW) 

was recorded between 6.15 a.m. and 

6.30 a.m. on 24 July 2011. This annual 

low was 0.7% lower than the minimum 

value in 2010 (6,278 MW on 25 July 

2010). 

In Germany, the maximum load in the 

50Hertz control area was 10,162 MW or 

2,890 MW lower than in 2010. 

AUG 

SEPT 

■ 2008 ■ 2009 ■ 2010 ■ 2011 

OCT 

NOV 

Imports and exports 

DEC 

In 2011, the import trend of the Belgian 

control area became more marked, with a 

balance of 2.61 TWh, after 2010 had seen 

a net import balance of 0.55 TWh. 

The rising import trend recorded until 

2008, which was reversed in 2009 due 

in particular to the economic crisis, was 

picked up again in 2010. 

Physical exchanges of electricity with 

neighbouring countries via the Elia grid 

totalled 23.92 TWh in 2011 – down 1.3% 

from 24.24 TWh in 2010. The increase 

in imports (up 7.0%) went on in 2011, 

mainly from France (up 128.0%), while 

exports decreased (down 10.1%), mainly 

to France (down 56.9%). 

50Hertz imported 16.3 TWh of electricity 

in 2011 (17.8 TWh in 2010), mainly from 

the Czech Republic and TenneT Germany, 

and exported 34.4 TWh (29.4 TWh 

in 2010), mainly to Poland and TenneT 

Germany. As a result, net exports of 

electricity were up 56% from 11.6 TWh to 

18.1 TWh.

IMPORTS AND EXPORTS – ELIA GROUP (per month) 

Elia System Operator 

France 

Netherlands 

Luxembourg 

Total 

Balance 


Poland 

Czech Republic 

Denmark 

TenneT GmbH 

import 

export 

import 

export 

import 

export 

import 

export 

Exp-Imp 

Exp+Imp 

import 

export 

import 

export 

import 

export 

import 

export 

Net offtake from the grid 

Net offtake is a measure of the volumes 

of energy taken from the Elia grid. In the 

case of local generation, some or all of 

the power generated is consumed directly 

on the site of the industrial customer or 

distribution system operator. The level of 

local generation was significantly higher 

than in 2010 (up 6.4%). 

Since energy generated and consumed 

locally is not drawn from the Elia grid, it is 

not counted as part of the net offtake, although 

it is included in the domestic consumption 

indicator. In 2011, net offtakes 

were 4.4% down on 2010, from 76,390 

TWh in 2010 to 73,052 TWh in 2011. 

(GWh) (GWh) (GWh) Change (%) Change (%) 

2011 2010 2009 2011-10 2011-09 

7,221 

2,330 

4,514 

7,004 

1,532 

1,318 

13,267 

10,652 

-2,615 

23,919 

432 

5,136 

1,705 

1,850 

2,087 

1,238 

12,113 

26,180 

3,167 

5,409 

7,383 

5,313 

1,846 

1,122 

12,395 

11,844 

-552 

24,239 

167 

5,331 

2,922 

494 

691 

2,742 

14,067 

20,874 

1,832 

6,642 

5,787 

3,769 

1,868 

910 

9,486 

11,322 

1,835 

20,808 

134 

5,616 

2,314 

914 

1,284 

1,800 

13,301 

22,498 

In 2011 a net volume of 59 TWh was 

drawn off from the 50Hertz grid. The net 

offtake of electricity was 6.3% lower than 

during the same period last year (63 TWh). 

The maximum offtake within the 50Hertz 

grid was 10,162 MW in 2011. This is 28% 

less than the maximum offtake in 2010 

(14,058 MW), a result of additional decentralised 

generation, mainly wind and solar, 

connected to distribution grids. 

Balancing generation and 

consumption to meet the 

needs of the market 

Balancing generation and consumption 

is primarily the responsibility of market 

players, in particular Access Responsible 

Parties (ARPs). ARPs are expected to 

ensure the best possible balance between 

their supply sources and their customers’ 

consumption. To this end, each ARP 

must inform Elia, one day ahead, of all 

the energy exchanges it will perform, on a 

quarter-hourly basis for each point on the 



128.0 

-56.9 

-38.9 

31.8 

-17.0 

17.5 

7.0% 

-10.1% 

374.1% 

-1.3% 

61 

-4 

-71 

73 

67 

-122 

-16 

20 

294.2 

-64.9 

-22.0 

85.8 

-18.0 

44.9 

39.9% 

-5.9% 

-242.5% 

15.0% 

69 

-9 

-36 

51 

38 

-45 

-10 

14 

grid. This applies to injections and offtakes, 

exchanges between ARPs, imports and 

exports. The residual imbalance for the 

Belgian control area is offset in real time by 

Elia using energy reserves available under 

contract with generators and industrial 

customers in Belgium. 

In Belgium, the volume of energy activated 

by Elia to ensure the balance of the control 

area was 1,092 GWh in 2011, as opposed 

to 844 GWh the year before. 

The control power needed to offset 

the difference between generation and 

consumption in the 50Hertz control 

area amounted to 1,383 GWh in 2011, 

compared with 1,703 GWh in 2010. 

27

28 



Infrastructure 

LENGTH OF THE HIGH-VOLTAGE GRID AT 1-1-2012 

Voltage (kV) Underground cables (km) Overhead lines (km) Total (km) 

Elia 2012 2011 2012 2011 2012 2011 

380 - - 891 891 891 891 

220 5 - 297 297 302 297 

150 433 427 2,007 2,008 2,440 2,435 

70 280 280 2,381 2,382 2,661 2,662 

36 1,921 1,927 8 8 1,929 1,935 

30 127 141 22 22 149 163 

Total Elia 2,766 2,765 5,606 5,614 8,372 8,379 

50Hertz 2012 2011 2012 2011 2012 2011 

AC 380 55 55 6,830 6,830 6,885 6,885 

AC 220 3 3 2,862 2,862 2,865 2,865 

AC 150 75 - - - 75 - 

DC 400 15 15 - - 15 15 

Transmission grid 150 73 9,690 9,690 9,840 9,765 

AC 110 2 2 13 23 15 25 

Total 50Hertz 150 75 9,705 9,715 9,855 9,790 

The figures do not include networks 

not owned by Elia. 

For the overhead lines, the figures 

shown are geographical lengths, i.e. the 

sum of the geographical lengths of the 

overhead lines (whether or not they were 

in operation) that are given in the table. 

Parallel circuits are counted only once. 

For the underground cables, the figures 

shown are electrical lengths, i.e. the 

sum of the lengths of the connecting 

circuits in operation which are given in 

the table. Parallel circuits are counted 

only once. 

Note the emergence of 220-kV underground 

cables for connecting up a 

customer facility whereas previously 

overhead lines were systematically used 

for this voltage. This reflects the development 

of technology. 

The total length of the network of underground 

cables has decreased, after 

some connections were put in reserve.

Each infrastructure project is based on criteria 

relating to the reliability, economic efficiency and 

sustainability of the proposed options. 

Investments 

Investments by the Elia Group in its transmission systems are driven by 

various factors. 

The need to meet the connection and 

upgrade requirements of industrial 

customers and distribution system operators, 

to cope with changing demand 

in terms of both volume and localisation 

of energy drawn, to replace facilities at 

the end of their service life or bring them 

in line with environmental requirements, 

to contribute to the liberalisation of the 

market, and to promote the integration 

of renewable energy sources. Each 

infrastructure project is based on criteria 

relating to the reliability, economic 

efficiency and sustainability of the proposed 

options. 



29

30 

The Elia grid in Belgium 

20 



More than 20 projects to 

connect up new industrial 

customers or modify existing 

connections were studied 

from a technical and economic 

perspective in 2011. 

Connections requested by 

industrial customers 

More than 20 projects to connect up 

new industrial customers or modify 

existing connections were studied from 

a technical and economic perspective 

in 2011. 

Elia has also used underground cables 

to put in place an electrical connection 

to the new 220-kV high-voltage substation 

at Berneau on behalf of Fluxys 

(operator of the natural gas transmission 

system). This connection was established 

on a loop of the existing Lixhe- 

Jupille line. 

In the case of the GlaxoSmithKline 

site at Wavre, 36 kV connections were 

laid between Louvain-la-Neuve and 

Basse-Wavre, on the one hand, and 

the customer’s site, on the other, to 

enable the initial phase of the scheduled 

load increase. At a subsequent 

stage, a 150 kV connection will upgrade 

the Basse-Wavre substation, using a 

150/36 kV transformer. 

Grid upgrades to keep up 

with electricity consumption 

About ten projects to upgrade the transformation 

capacity to medium voltage 

or extend the medium-voltage facilities 

were launched in 2011 to deal with 

an increase in consumption in some 

distribution systems. Examples are the 

36 kV Destelbergen and 70 kV Recogne 

facilities. 

Facility replacement 

programme 

In 2011, Elia continued to implement its 

programme to renovate its facilities, allowing 

it to maintain the high level of reliability 

it offers its customers. Examples 

include the replacement of 36 kV 

facilities in the Botanique high-voltage 

substation in Brussels and a number 

of other projects such as the replacement 

of a 36/12 kV transformer in the 

Wichelen substation. 

Integration of decentralised 

and/or onshore renewable 

energy generation 

Elia, in close collaboration with the distribution 

system operators, conducted a 

number of studies enabling the safe integration 

of decentralised generation or 

renewable energy generation at minimal 

cost for the community. 

Significant achievements in this regard 

in 2011 were the renovation of the 

high-voltage substation at Monceau-en- 

Ardennes with a view to connecting up 

local generation in the area and the 150kV 

injection project at Rijkevorsel making 

use of a new 150 kV underground 

connection at a branch point on the 

existing Massenhoven – Sint-Job line. 

Projects falling outside 

current investment plans 

The very high winds that hit Wallonia on 

14 July 2010 caused a lot of damage, 

and the Elia transmission system was 

no exception. 

The night following the storm Elia put in 

place a temporary back-up solution to 

supply the town of Dinant. Within a few 

days, Elia also implemented a 380 kV 

back-up line to restore the France-Belgium 

interconnection and established a 

back-up supply for the Tihange nuclear 

power plant’s ancillary services.

Final version of the development plan 

The final version of the plan is the culmination of a process including 

an impact assessment and consultation of the general public, the 

Federal Council for Sustainable Development (FRDO/CFDD), the SEA 

Advisory Committee (of the Federal Public Service Health, Food Chain 

Safety and Environment), the authorities and the regulators. 

The various components of the grid 

that had been damaged were subsequently 

repaired or replaced and work 

on reconstructing the final damaged line 

was completed on 6 July 2011. Thanks 

to the commitment of Elia’s staff and 

subcontractors, all these activities were 

carried out without causing any delays 

to the works scheduled at the start of 

the year. 

Stevin: extension of the 

380 kV grid to the coast 

Through the Stevin project, involving a 

380 kV line between Zomergem and 

Zeebrugge, Elia wants to achieve four 

objectives: to connect up the second 

phase of offshore wind farms off the 

Belgian coast; to connect up many 

decentralised renewable energy generation 

units; to create a subsea interconnection 

between the Belgian and UK 

grids; and to enhance security of supply 

in West Flanders, and in particular 

around the port of Zeebrugge. 

International projects 



31 

Interconnection with Germany: ALEGrO project 

The studies conducted in 2011 confirmed the advantageous 

nature of a DC connection between the German 

and Belgian grids, which will be a first in the Central 

West Europe region. The project, which has been given 

the name ‘ALEGrO’ (Aachen Liège Electric Grid Overlay), 

will consist of a very high voltage DC cable (with 

power of 1,000 MW to 1,600 MW) running for around 

100 km between the Lixhe substation in Belgium and 

the Oberzier substation in Germany. In 2011, Elia and 

transmission system operator Amprion decided to 

launch the initial phase with a view to laying down the 

technical aspects and to starting up the authorisation 

procedures. Commissioning of ALEGrO is planned by 

2017. 

Interconnection with France 

The studies launched in 2010 by Elia and French 

transmission system operator RTE and as part of the 

10-year ENTSO-E development plan will lead to an 

upgrade of the transmission capacity between Belgium 

and France by 2018-2020. Therefore, a feasibility study 

was started to assess the impact on security of supply, 

electricity market integration and renewable energy 

integration. This phase will conclude with a concrete 

investment proposal based on the results of a cost/ 

benefit analysis.

32 




Interconnection with the UK: the Nemo project 

Elia and National Grid have continued their joint works aimed at creating a subsea DC 

connection, of some 130 km in length, between their grids with a view to increasing market 

liquidity and enhancing security of supply in both the UK and Belgium. The DC connection 

comprises two separate cables (one with a positive voltage, and the other with a negative 

voltage). The two ends are connected to a high-voltage substation, a converter station for DC/ 

AC conversion and connection to the existing 380 kV onshore grids. The actual conversion will 

be carried out by power electronic semiconductor components. The connection will have a 

capacity of between 700 MW and 1,300 MW, depending on the findings of the ongoing study. 

While the technical study was completed in 2011, significant steps were also taken in defining 

the regulatory framework following, for example, a consultation of the market players organised 

jointly by the Belgian regulator CREG and its UK counterpart OFGEM. It put forward a regulatory 

model specifically for interconnectors, with Nemo as the pilot project. The connection is due to 

be commissioned by 2017-2018. 

In 2011, important steps were taken in 

the permit procedures. For example, 

the environmental impact report (‘plan- 

MER’ or ‘milieu-effectenrapport’), which 

includes alternatives and additional 

environmental aspects, was approved 

in May. On 22 July, the government of 

the Flemish Region outlined the new 

infrastructure (route, location of highvoltage 

substations, requirements) in its 

draft regional land-use plan (‘GRUP’ or 

‘gewestelijk ruimtelijk uitvoeringsplan’). 

The route proposed by the Flemish 

government comprises 47 km of connections, 

including 10 km underground. 

The overhead connection follows 

existing routes and corridors as much 

as possible. The public consultation 

period that is provided for in the context 

of this procedure came to an end; after 

assessing objections (this process 

The direct-current subsea link 

will be connected on both sides 

of the English Channel to AC/DC 

conversion stations. 

is currently in progress), the Flemish 

government should announce its final 

decision in the spring of 2012. Depending 

mainly on whether building permits 

are granted, commissioning is expected 

in late 2014. 

Federal development plan 

approved 

In November 2011, the Federal Minister 

for Energy approved the final version 

of the development plan 2010-2020 for 

the electricity transmission system. The 

plan presents a detailed estimate of 

transmission capacity needs, based on 

a series of underlying hypotheses and 

is in line with the 10-year development 

plan drawn up by ENTSO-E. 

The plan was drawn up in cooperation 

with the Directorate General for Energy 

of the Federal Public Service Economy, 

SMEs, Self-employed and Energy and 

the Federal Planning Bureau, taking particular 

account of the prospective electricity 

study. The final version of the plan 

is the culmination of a process including 

an impact assessment and consultation 

of the general public, the Federal Council 

for Sustainable Development (FRDO/ 

CFDD), the SEA Advisory Committee (of 

the Federal Public Service Health, Food 

Chain Safety and Environment), the 

authorities and the regulators.

The 50Hertz Transmission grid 

in Germany 

North connection Schwerin 

for connecting Hamburg 

wind farms 

The connection comprises a number 

of sections, including one – in Mecklenburg-Western 

Pomerania – that was 

completed in July 2010. The public consultation 

relating to the second change to 

the schedule for the section in Schleswig 

Holstein is finished and a decision on 

whether or not permission will be granted 

is expected in 2012. 

Southwest interconnection 

The first part of the connection, between 

Lauchstädt and Vieselbach, was 

commissioned in December 2008. For 

the second part, between Vieselbach 

and Altenfeld, the planning authority put 

forward a draft decision in late December 

2011 and planning permission is 

expected soon. Appeals against this 

could delay the project for another year. 


The regional planning procedure for the 

third part, between Altenfeld and the 

border with Bavaria, was completed in 

March 2011. The approval document is in 

preparation. 

Ring north of Berlin 

Interconnection with Poland 

The regional planning procedure is expected 

to be submitted in the winter 2011-2012. 

The regional planning procedure has 

been completed and the final route has 

been decided. The connection will be 

built in at least two phases to ensure the 

security of supply to the Hennigsdorf 

metallurgical industry. The procedures 

relating to the two phases are carried 

out in coordination with the planning 

authority. 

Uckermark connection 

The regional planning permission procedure 

has been completed, while the 

approval procedure is still ongoing. Intensive 

information campaigns and dialogue 

are under way with politicians, citizens 

and local environmental associations. 



Bärwalde – Schmölln 

The regional planning procedure has 

been completed. Preparations are being 

made for the approval procedure. 

First national grid 

development plan 

33 

In 2012, 50Hertz and the three other 

German system operators Amprion, 

TenneT and EnBW TNG will publish a 

grid development plan that will reflect the 

expected developments in the German 

electrical infrastructure over the next 

10 years and a 20-year forecast. It will 

also include specific recommendations 

on the expansion and construction of 

transmission systems in Germany, based 

on a range of technical options including 

specifically the abandonment of nuclear 

energy by 2023. 

From the start of the process, the stakeholders’ 

involvement is crucial. Against 

this backdrop, the German TSOs have 

launched a website about the process 

and the consultation (www.netzentwicklungsplan.de).

34 



Grid maintenance 

Major technological breakthroughs have also been made in preventive and corrective 

maintenance, calling for better expertise from teams. 

Thanks to the expertise of the teams in the field 

responsible for preventive and corrective maintenance 

of the transmission system and for the execution of the 

replacement investments, security of supply has been 

at a very high level for more than a decade. 

Preventive maintenance 

of the Belgian grid 

This outcome is the result of a programme 

of preventive maintenance 

and replacement policies based on the 

technologies used in the grid and the 

condition of the components that make 

up the infrastructure. This programme 

is driven by operating experience 

feedback from in-depth analyses of the 

causes of each incident, even though 

most of them did not have any impact 

on customers. Elia is also continuing to 

work on standardising and harmonising 

components, databases and working 

procedures. 

In the case of lines, cables and pylons, 

preventive maintenance encompasses 

a number of types of inspections, 

such as infrared or camera inspection 

of all 20,000 or so pylons, which are 

inspected several times a year. 

As regards high-voltage substations, 

preventive maintenance is scheduled 

on some 11,750 infrastructure elements 

across Belgium. In 2011, almost 16,950 

operations were carried out by teams 

in the field, covering preventive maintenance 

(11,700), inspections (4,500) and 

legal checks (750). 

First live works in 

Belgium: the helicopter 

from which the basket is 

suspended prepares for 

take-off. 

As far as investments in replacements 

are concerned, synergies are sought 

between investments in upgrading, 

replacement and worker safety. In 2011, 

some €68.6 million was invested in 

upgrading end-of-life equipment. Many 

projects were carried out, including the 

replacement, at all voltage levels, of 

circuit breakers, isolators, bus bars and 

line sets, voltage and current transformers, 

lightning arresters, meter boxes, 

protection relays and remote monitoring 

systems. Maintenance and replacement 

activities are performed by many 

subcontractors and around 600 Elia

16,950 

In 2011, almost 16,950 

operations were carried out 

by our teams in the field, i.e. 

almost 46 operations a day 

staff, of whom two-thirds work in the 

field and one-third provide technical and 

administrative support. 

In 2011, a number of innovations were 

tested out in the field so as to expand 

the range of methods at the departments’ 

disposal and plan work such 

that it caused as little disruption as possible 

to operation of the grid. 

650 pylons, 300 km 

Maintenance work in Germany 

carried out in 2011 was on some 

650 pylons, what accounts for 

300 km of power lines. 

The inspection of overhead 

line conductors using a 

remote-control robot was 

tested successfully in 2011. 

LIVE WORKS 

Heliborne work on a live 380-kV line 

were carried out for the first time in Belgium, 

on the Achêne – Lonny interconnection. 

Nearly 150 marking spheres 

were replaced while the line was kept 

in service. Keeping lines in service is 

becoming essential for certain connections 

due to the increase in energy 

transmission volumes. This pilot project 

was organised in coordination with the 

Federal Public Service Economy and 

the relevant authorities. 

ROBOT FOR LINE MONITORING 

Elia and RTE jointly carried out tests 

for using a robot to inspect the cables 

of their overhead lines, with a view to 

detecting both more quickly and more 

reliably those areas where maintenance 

work is needed, in addition to using the 

traditional methods at their disposal. 



Preventive maintenance 

of the 50Hertz grid 

35 

In Germany, the maintenance programme 

planned for 2011, worth around 

€50 million, was carried out. The priorities 

in this programme were upgrades of 

the steel conductors of overhead lines 

and the continued replacement of the 

insulators in these lines. Work carried 

out in 2011 was on some 650 pylons, 

which accounts for 300 km of power 

lines.

36 



Market operation 

Following the liberalisation of the internal electricity market, the role of the market 

facilitator became crucial to the mission of power transmission system operators. 

Integration of the European 

markets 

As in previous years, Elia continued 

its drive for further integration of the 

Belgian and German electricity markets 

with their neighbouring markets 

and thus contributed to the efforts to 

meet the objective set by the European 

Commission of achieving an integrated 

electricity market by 2014. 

Long-term markets 

During 2011, transmission system operators 

of the Central West Europe (CWE) 

region, in collaboration with the TSOs 

of Central South Europe (CSE) and the 

Swiss TSO, laid down a shared set of 

harmonised rules governing explicit 

capacity auctions covering 12 borders. 

These rules, approved by the concerned 

regulators in November 2011, 

are implemented by CASC.EU, which 

acts as the inter-regional auctioneer for 

the market players. 

FR 

B 

NL 

Figure: borders 

covered by harmonised 

auction rules 

CH 

DE 

IT 

AT 

SI 

G

Day-ahead markets 

ONE YEAR OF CWE AND ITVC 

MARKET COUPLING 

‘Price coupling’ enables the volumes 

of electricity traded and market prices 

to be calculated on the basis of the 

information provided by the transmission 

system operators (transmission 

capacities available at the borders) 

and the power exchanges (purchase 

and sale offerings). The mechanism 

was initially set up in October 2006 in 

Continental Europe to couple together 

Belgian, French and Dutch prices. It 

uses the Cosmos algorithm developed 

by Belpex, Elia and N-Side. 

This price coupling mechanism was 

expanded to include Germany on 9 

November 2010 and so become the 

CWE area, and was complemented by 

interim tight volume coupling (ITVC) for 

the Scandinavian market (Denmark, 

Finland, Norway, Estonia and Poland 

using the Swepol cable). The NorNed 

interconnector between the Netherlands 

and Norway was integrated into 

this volume coupling system in January 

2011. In April, the implicit border allocation 

mechanism of the CWE region was 

extended to the BritNed interconnector, 

thereby establishing coupling between 

the CWE market with its price coupling 

mechanism and the APX-Endex dayahead 

market in the UK. 



The CWE market is coupled 

with the Scandinavian 

market through the interim 

tight volume coupling (ITVC) 

mechanism. 

37 

Those two coupling mechanisms 

(price and volume) are combined in a 

sequential process in which flows on 

the connections between Germany, 

Denmark and Sweden are calculated in 

advance (by EMCC), followed by a CWE 

region price coupling mechanism (jointly 

put in place by APX-Endex, Belpex and 

EPEX Spot) and by a market splitting 

mechanism for the Scandinavian market 

(implemented by Nord Pool Spot). 

The CWE price coupling mechanism 

and the ITVC coupling mechanism led 

to price convergence or prices that were 

the same most of the time on the dayahead 

markets of the CWE countries, 

including Belpex in Belgium. 

In 2011, the prices of the four coupled 

intraday markets in CWE converged 

some 65.75% of the time, and prices 

in Belgium and France were the same 

99.18% of the time, while in Belgium and 

the Netherlands they converged 71.28% 

of the time. 

The CWE market coupling mechanism 

has also reduced price volatility by combining 

the liquidity of the region’s dayahead 

markets with the ability to avoid 

negative prices in periods of low energy 

demand coupled with a high level of 

renewable generation in Germany.

38 



PRICE CONVERGENCE IN CWE 2011 

All equal : 65,753% 

All different : 0,411% 

DE=BE=NLFR : 0,103% 

DE=NLFR=BE : 22,443% 

BE=FR=NL : 5,160% 

BE=FR : 5,160% 

BE=NL : 0,263% 

DE=NL : 0,046% 

Market coupling has led to an improvement 

in the utilisation of import/export 

capacities at the borders between Belgium 

and the Netherlands and between 

Belgium and France on a day-to-day 

basis, with average daily volumes of 

8,424 MWh for imports and 5,656 MWh 

for exports. 

THE BELPEX DAY-AHEAD MARKET 

At the end of 2011, some 35 market 

players – generators, suppliers, traders, 

banks and industrial users – were registered 

and operating on Belpex. 

Volumes have steadily increased since 

Belpex was launched in 2006 (with the 

exception of 2009 when consumption 

decreased considerably due to 

the financial and economic crisis). This 

growth continued in 2011. Volumes traded 

on the Belpex day-ahead market in 

relation to the Belgian load are up from 

13.7% in 2010 to 14.8% in 2011. The 

traded volume has also increased, from 

an average daily volume of 32,446 MWh 

in 2010 to 33,839 MWh in 2011. 

The record volume in 2011, recorded on 

16 December, was 73,300.1 MWh, i.e. 

29% of the daily consumption on the 

Elia grid. 

The average price on the Belpex dayahead 

market was €49.37/MWh, slightly 

lower than the average for the Netherlands 

(€53.03/MWh) and Germany 

(€51.12/MWh) but slightly higher than the 

average for France (€48.89/MWh). 

ONGOING PROJECTS 

Elia, in cooperation with Belpex and all 

the other transmission system operators 

and power exchanges in the CWE region, 

Scandinavia and the UK, is paving 

the way for a price coupling mechanism 

for the North West Europe (NWE) region. 

A process and a unique algorithm 

will be implemented that will form the 

cornerstone for the gradual extension of 

the mechanism to the rest of Europe. 

Furthermore, throughout 2011, the 

TSOs and power exchanges of the 

CWE region continued their joint efforts 

to study the feasibility of a flow-based 

method for implicit daily allocation. 

This method, which aims to take better 

29 % 

The record volume in 2011, 

recorded on 16 December, 

was 73,300.1 MWh, i.e. 29% 

of the daily consumption on 

the Elia grid. 

account of the physical limits of the 

transmission system, was examined by 

a feasibility report published in March 

2011. The results were presented to the 

stakeholders involved in June 2011 at a 

public forum in Amsterdam. An updated 

version was published in October and 

can be found on the Elia website. Work 

in this regard will continue in 2012. 

Intraday markets 

The intraday markets are important 

tools, in particular in light of the growing 

share of intermittent energy sources 

(wind and solar power) in the energy mix 

because they allow suppliers to balance 

their generation with the consumption of 

their customer in near-real time. 

The intraday market in Belgium is operated 

by Belpex. In 2011, it maintained its 

strong growth, with a trading volume of 

363.4 GWh as opposed to 275.6 GWh 

in 2010. In total, 5,613 contracts were 

concluded, compared with 6,896 in 

2010.

The plans for implicit allocation of crossborder 

intraday transmission capacities 

on the interconnection between Belgium 

and the Netherlands came to fruition in 

February 2011, when the Elbas trading 

platform used for the Nordic and German 

markets came online. Since it was 

put in place, it has been responsible for 

intraday imports of 61.9 GWh from the 

Netherlands and exports of 206.7 GWh 

in the other direction. 

Moreover, the integration of the Belgian 

and Dutch intraday markets with the 

Scandinavian intraday market is scheduled 

for March 2012, in the wake of the 

introduction of an implicit allocation 

mechanism on the NorNed connection 

between the Netherlands and Norway. 

This will make it possible to trade electricity 

between Belgium and Finland on 

an intraday basis in a single transaction. 

Complete integration of the intraday 

markets of the NWE region (including a 

mechanism for implicit allocation of the 

cross-border intraday capacity between 

Belgium and France) is expected by the 

end of 2012. 

Belgian balance and 

ancillary services markets 

Elia has taken a number of initiatives to 

anticipate the integration of significant 

volumes of generation from variable renewable 

energy sources in the balance 

and ancillary services markets. 

A new methodology for evaluating the 

reserve volume, based on probabilistic 

modelling – and therefore capable of 

reflecting the impact of errors in the 

forecasts for wind and photovoltaic 

energy on balancing the system – has 

been introduced. On this basis, the 

methodology and resultant volumes 

for 2012 were approved by CREG in 

May 2011. Furthermore, preparations 

are being made for synergies with the 

Netherlands and Germany. 

Increasing market 

transparency 

Ongoing projects 

Elia, in cooperation with Belpex and all the other 

transmission system operators and power exchanges 

in the CWE region, Scandinavia and the 

UK, is paving the way for a price coupling mechanism 

for the North West Europe (NWE) region. 

In 2011, Elia continued to support the 

FEBEG drive to increase the transparency 

of power generation data on the 

Belgian market. Elia now publishes on 

its website data relating to the availability 

of generation units (daily updates of 

generation availabilities) and unplanned 

unavailabilities (in the form of Urgent 

Market Messages). 

Netzregelverbund 



German market 

COOPERATION IN GRID 

39 

MANAGEMENT AND CONTROL 

October 2011 saw the launch of the 

‘Netzregelverbund’, a cooperative initiative 

relating to grid management and 

control, with a trial period involving the 

Danish transmission system operator 

Energinet.dk. It aims to optimise 

the use of control energy while avoiding 

instances of activation in opposite 

directions in two zones. Following good 

results in Germany, the initiative can 

now be implemented across national 

borders, with a corresponding trial period 

starting in January 2012. Potential 

partners are Elia, CEPS, Swissgrid and 

TenneT NL. 

The ‘Netzregelverbund’, a cooperative initiative relating 

to grid management and control, aims to optimise the 

use of control energy while avoiding instances of activation 

in opposite directions in two zones.

40 



Preventive management 

of critical grid situations 

As a power transmission system operator, the Elia Group is taking a series of preventive 

measures to maintain the balance of the grid and a secure power supply. 

Managing the balance 

between generation and 

consumption 

As electricity cannot be stored in any 

great quantity (except by means of hydraulic 

pumping units), generation must 

be tailored at all times to consumption in 

this large grid – consumption that is the 

result of the actions and needs of more 

than 500 million inhabitants. 

Transmission system operators such as 

Elia and 50Hertz maintain this balance 

in their respective control area within 

strict limits and in compliance with common 

rules. 

To this end, each of the 41 transmission 

system operators reserves from 

generators, through European calls for 

tender, a generation capacity enabling 

them to adjust upwards or downwards 

the quantity of energy injected in their 

respective grid. 

This generation capacity is differentiated 

according to the speed of response 

and the duration of the intervention. 

First of all, some generation units are 

equipped to adjust their generation almost 

automatically based on deviations 

from the frequency of reference (50 Hz 

in Europe) and the frequency measured 

on the grid, which depends on the 

instantaneous imbalance between the 

quantities of energy injected and taken 

off the entire interconnected grid. All 

the generation units connected to the 

large European grid will consequently 

react together to immediately offset the 

simultaneous loss of 3,000 MW (3 million 

kW), i.e. the equivalent of two of the 

largest generation units, irrespective of 

their location in continental Europe. The 

system operators, to which the defective 

powers stations are connected, will 

then use other means of generation 

to restore this automatic intervention 

capability as quickly as possible, until 

the situation is back to normal. 

Better coordination between 

European electricity transmission 

system operators is the key 

to security of supply. 

Black-start: progressive 

reconstruction of the grid 

In the event of an interruption of the 

power supply across a wide geographical 

area, the system operator 

concerned will use generation units 

specially equipped to start up autonomously, 

known as ‘black-start’ units. 

Each system operator has contracts for 

black-start services with generators in 

its area and regularly checks whether 

these units can start up independently 

as required. In 2011, Elia conducted 

detailed tests in two units located in Belgium. 

These generation units gradually 

allow to resupply a growing segment of 

the transmission system and therefore 

the other generation units can be restarted, 

while at the same time connecting 

up more and more consumers so 

as to continuously maintain a balance 

between the quantity of energy injected 

into the grid and the quantity of energy 

taken off it.

Transmission system 

operators such as Elia 

and 50Hertz maintain this 

balance in their respective 

control area within strict 

limits and in compliance 

with common rules. 

Crisis simulation: teams 

under pressure performing 

vigilance tests to improve 

procedures 

In the event of a crisis, the level of preparation 

of the teams mobilised to restore 

normality is key. Elia has from the outset 

had an emergency plan setting out the 

roles and responsibilities of the various 

players in the event of a major problem 

in the electricity transmission system. 

These procedures are regularly tested 

in simulation exercises. In 2011, Elia put 

in place the action plan that emerged 

from the large-scale crisis exercise in 

late 2010. Moreover, preparations for the 

next international crisis exercise were 

started. The exercise will be organised 

in 2012 in cooperation with the French 

and Dutch system operators and the 

regional technical coordination centre 

Coreso. 

Following a fire at the Bruegel 

substation, a booklet was sent to 

local residents to tell them about 

current facilities in that node of the 

power transmission system. 

Earth Hour: raising 

awareness to enable better 

management 

As in previous years, Elia and its fellow 

system operators took appropriate 

measures for Earth Hour, an initiative 

organised by the World Wildlife Fund to 

draw attention to climate change and 

the energy issue. Elia puts its sites on 

partial alert to safeguard the operational 

security of the grid. 



Fire at the Bruegel 

substation 

41 

The violent storm that hit Belgium on 28 

June 2011 had many impacts across the 

entire grid. The main incident occurred 

at the Bruegel high-voltage substation, 

one of the major junctions in the 380-kV 

Belgian and European grid. Following 

a lightning-strike, a fire broke out 

on one of the three poles of a 380 kV 

transformer, caused by the combustion 

of the mineral oil contained in the 

transformer. 

The emergency response services 

acted quickly, mobilising fire-fighters 

from Asse, Zellik, Zaventem, Brussels 

and Opwijk and the Civil Protection 

Agency and the emergency services, 

after the emergency plan had been put 

into action by the mayor of Dilbeek. An 

on-site operations control room was set 

up. Having established the type of response 

required, the fire-fighters put out 

the fire by spraying a mixture of water 

and aqueous film-forming foam (AFFF) 

at it to lower the temperature (measured 

using an infrared camera). 

Remarkably, despite the violent impact 

of the lightning and the fire, there was 

no interruption of the power supply provided 

to Elia’s Belgian customers.

42 



Procedure for shortage 

in generation 

Despite all the preventive measures that 

have been taken, extreme situations 

resulting from a substantial shortage 

of power generation remain a possibility. 

To that end, a procedure was 

devised by Elia in close consultation 

with the Belgian Government Coordination 

and Crisis Centre (GCCC) and the 

Federal Public Service Economy. Note 

that ENTSO-E flagged up the risk of a 

Europe-wide shortage in certain periods 

(period of intense and prolonged freezing) 

of the winter of 2011-2012 following, 

for instance, the shutdown of several 

nuclear units in Germany. 

Plan to revise the 

reconstruction code 

The proper operation of the electricity 

transmission system is of vital importance 

for the community and for business 

and industry. The electrical system 

was designed to work at a very high 

level of reliability, but the risk of an interruption 

cannot be ruled out completely, 

and therefore grid reconstruction codes 

were drawn up and have been implemented 

for several years now. They 

define the operating procedures to be 

deployed by control centres, balance 

responsible parties, grid users and other 

system operators in the event that the 

grid has to be fully or partially reconstructed. 

In 2010, the Elia reconstruction code 

was fundamentally overhauled, while 

in 2011 simulator training was introduced 

for the concerned staff. Elia also 

received a positive opinion from CREG 

about this revision of the reconstruction 

code, in terms both of content and 

structure and of instructiveness. The 

public version of the code was presented 

at the Elia Customer Day. 

Cooperation with the 

Belgian Government 

Coordination and Crisis 

Centre (GCCC) 

Elia cooperates closely with the Belgian 

Government Coordination and Crisis 

Centre (GCCC) to continuously improve 

the processes relating to emergency 

plans. Therefore a training session was 

organised for the GCCC operators 

to familiarise them with the electrical 

systems and the levels of severity of potential 

grid incidents. A consultation was 

also organised between the managers 

of the respective crisis centres to give 

them a better understanding of their 

structures and their mutual expectations.

Preparing for the future : 

research and development 

The growing share of variable renewable energy sources and of decentralised generation in 

the energy mix is causing a radical and lasting change in electrical systems and how they are 

managed, making innovation essential for transmission system operators. 

Against this backdrop, the Elia Group 

established a Research & Development 

and Knowledge Management Department 

which, in close cooperation with 

ENTSO-E and the European Electricity 

Grid Initiative, is participating in a number 

of European projects. 

57% 

COMPLETED IN 2012 

AFTER, ANM, Ecogrid, e-Mobility, GRID+, 

Improvement of Grid Integration of RES, 

MOSYTRAF, OffshoreGrid, Optimate, RegModHarz, 

SUSPLAN, Twenties, 7MW-WEC-by11 

At the end of 2011, the Elia Group had 

a portfolio of 13 projects in which the 

Group is cooperating with one or more 

Belgian, German or other European 

partners. At the same time, the Group is 

involved in some 10 initiatives involving 

cooperation in R&D projects which will 

start up in 2012 or are currently being 

assessed by the funding institutions 

concerned. 



43 

50Hertz is also working, as part of academic 

partnerships, on some 10 studies 

that aim to analyse and assess specific 

issues that are relevant to management 

of the electrical system, e.g. reconstruction 

of the 50Hertz grid, studies of 

regional grids, and planning simulations 

of generation units. 

43% 

PROPOSALS OR STARTING IN 2012 

ADELE-ING, Aiolus, e-Highways 2050, 

eStorage, High Temperature Conductors, iTesia, 

Pegase, SDL Batt, SLim, Space Optimised 

Overhead Conductor Systems

44 



B-EEGI 

Elia is a key partner in the B-EEGI 

platform, a collaboration platform of 

five Belgian system operators (Eandis, 

Elia, Infrax, Ores and Sibelga) as part of 

the European Electricity Grid Initiative 

(EEGI). Through this platform, the partners 

want to develop a joint vision of the 

innovation activities and objectives and 

therefore benefit from some leverage 

vis-à-vis regional, Belgian and European 

support programmes. By participating 

and actively investing in R&D projects, 

the B-EEGI partners are helping to meet 

the objectives of the European Strategic 

Energy Technology Plan (SET Plan). 

REGMODHARZ 

The RegModHarz project brings together, 

alongside 50Hertz, distribution 

system operators, IT and component 

manufacturers, research institutes, 

universities and sponsors of renewable 

energy. It is one of the six German 

regional models supported by the public 

‘E-Energy’ programme which analyses 

the challenges and opportunities 

involved in the integration of renewable 

energy sources. 

SUSPLAN* 

50Hertz is a stakeholder in the 

SUSPLAN project coordinated by 

SINTEF (FP7* research area EN- 

ERGY-2007-7.3-05). The project aims 

to develop regional and pan-European 

recommendations for more effective integration 

of renewable energy into future 

infrastructures. It adopts an integrated 

approach for electrical, gas and heat 

infrastructures. 

E-HIGHWAYS 2050 

Elia and 50Hertz are jointly participating 

in the ‘e-Highways 2050’ programme 

facilitated by ENTSO-E and coordinated 

by RTE (as part of the FP7 call ENER- 

GY.2012.7.2-1). Following the ENTSO-E 

Study Roadmap towards a Modular 

Development Plan on pan-European 

Electricity Highways System 2050 

(MoDPEHS) developed by 50Hertz and 

coordinated by the ENTSO-E working 

group on electricity highways by 2050, 

the consortium comprising transmission 

system operators and external partners 

aims to develop tools for a long-term 

planning schedule containing design 

options for future European electricity 

highways.

FP7 Projects * 

ECOGRID* 

The European EcoGrid project comprises 

a demonstration on the Danish island 

of Bornholm of the effective operational 

management of a power distribution 

system entailing strong penetration of a 

wide range of variable sources (almost 

50%). The Elia Group is conducting 

the research on the implementation of 

these market concepts on a large scale 

throughout continental Europe. 

ESTORAGE 

The storage of electrical energy will 

become more and more important in 

Europe, in particular because it can be 

deployed rapidly to ensure a continuous 

balance between renewable energy 

and consumption. The eStorage project 

aims to enhance the technology of 

pump-storage equipment and to assess 

the market models enabling its integration 

and its rapid deployment. 

TWENTIES* 

The TWENTIES project aims to identify 

and test the technical resources that 

facilitate the large-scale penetration 

of renewable energy, and in particular 

wind energy. A number of partners are 

making a contribution to these efforts: 

Belgian universities, such as the Catholic 

University of Leuven (KULeuven), the 

Université libre de Bruxelles (ULB) and 

the University of Liège (ULg), and the 

Coreso regional technical coordination 

centre. Elia is responsible for six 

demonstration activities (NETFLEX – 

Enhanced Network Flexibility). Elia and 

50Hertz will be involved in assessing the 

potential for deployment of these tools 

on a European scale. 



The Seventh Framework Programme (FP7) bundles all research-related EU initiatives together 

under a common roof playing a crucial role in reaching the goals of growth, competitiveness 

and employment, along with a new Competitiveness and Innovation Framework 

Programme (CIP), Education and Training programmes, and Structural and Cohesion Funds 

for regional convergence and competitiveness. 

45 

OPTIMATE* 

Five transmission system operators (in 

Germany, Belgium, France and Spain) 

have been cooperating with seven 

distribution system operators since 

2009 as part of a three-year research 

project. This project aims to evaluate the 

advantages and disadvantages of market 

models designed to integrate vast 

sources of renewable energy sources. 

Elia and 50Hertz are contributing to the 

development of market models for the 

Central West Europe region.

02 

Environmental 

report 

Elia and 50Hertz aim to serve as a role model for 

the market and the community. The environmental 

dimension, i.e. a concern for the future of the planet, 

is an integral part of all the Group’s activities. 



47

48 

ELIA 2010 


All partners involved in the Renewables Grid 

Initiative share a single vision: for up to 100% of the 

power integrated into the electricity system to come 

from renewable sources. We must help people to 

understand that, with the appropriate development of 

grid infrastructure in Europe, we will open the doors 

to a climate-friendly future, based on decentralised 

generation and the large-scale integration of 

renewable energy. 

Grids are the key 

“The WWF’s vision is for 100% of all energy 

worldwide – not just electricity – to 

come from renewable sources by 2050. 

Such a vision calls for ambitious actions 

to be taken by all players – industry, 

governments and consumers. The 

European energy sector can and must 

lead by example. That is why the WWF 

is closely involved with the Renewables 

Grid Initiative (RGI). Power transmission 

system operators like 50Hertz and 

Elia are demonstrating the leadership 

needed to establish a power supply that 

is not only renewable, but also economically 

viable, reliable and affordable. 

Stephan Singer 

DIRECTOR GLOBAL ENERGY POLICY, WWF 

“Electricity from renewable energy 

sources – primarily wind, biomass and 

solar power – is available in abundance 

across Europe and in neighbouring 

areas such as North Africa. To effectively 

capitalise on these resources, 

greatly expand their use and facilitate 

a smooth transition from fossil fuel and 

nuclear power to widespread decentralised 

generation and renewables by the 

middle of the 21st century, we need to 

manage interconnections in a coordinated 

way and consolidate and develop 

a sophisticated infrastructure of power 

transmission systems. Otherwise, we will 

not be able to hit our climate targets or 

provide consumers with a reliable power 

supply from renewable sources. The 

WWF appreciates that system operators 

like 50Hertz and Elia are taking its side 

in the debate to promote the cause of 

renewables. 

“At the moment it is difficult to obtain 

public approval for fresh investment in 

infrastructure. We will not win people 

over by adopting a merely technocratic 

approach. We must come up with 

a convincing argument, a compelling 

story, a vision of a better and cleaner 

world, shared by left- and right-wing 

politicians alike, by parliaments and in 

cities and villages. 

“All partners involved in the Renewables 

Grid Initiative share a single vision: for 

up to 100% of the power integrated into 

the electricity system to come from renewable 

sources. We must help people 

to understand that, with the appropriate 

development of grid infrastructure in 

Europe, we will open the doors to a 

climate-friendly future, based on decentralised 

generation and the large-scale 

integration of renewable energy.”

Andreas Förster 

SYSTEM OPERATIONS 

The diligence and know-how of our employees, 

combined with continuous training efforts, help us meet 

our environmental obligations. 

“Environmental protection is a key 

consideration in the planning, development 

and operation of our power 

transmission system. As Environmental 

Manager at corporate level, I 

continually ensure the follow-up and 

improvement of the 50Hertz environmental 

management system. 

My work is highly varied: I am responsible 

for properly implementing environmental 

legislation into our operational 

procedures and providing expert 

advice to colleagues responsible for 

environment at regional centres. I also 

Valérie Legat 

MOBILITY COORDINATOR 

We want to implement a proactive policy that garners 

the widespread support of all our colleagues by providing 

them with the means to actively contribute to green mobility 

on a daily basis. 

“Mobility has become a key challenge 

for Elia, which has several administrative 

offices dotted around the Brussels 

region as well as facilities and sites 

spread across Belgium as a whole. We 

want to implement a proactive policy 

that garners the widespread support 

of all our colleagues by providing them 

with the means to actively contribute 

to green mobility on a daily basis. 

“The provision of carpooling vehicles, 

as of 2011, means that employees can 

leave their own cars parked at home, 

work closely with numerous departments 

on environmental matters, from 

development projects to hazardous 

waste transportation, not to mention 

permit management, pollution control 

and water conservation. 

“Through the integration and transmission 

of a significant share of renewable 

energy, 50Hertz is making a considerable 

contribution to climate protection. 

To ensure the transmission of energy 

that produces little or no pollution, we 

must establish new connections. The 

connection of Baltic 1, the first wind 

even if they are required to travel 

during the day (near their workplace). 

Since December 2011, our fleet of 

carpooling vehicles has included two 

fully electric cars, translating our aims 

into concrete action. 

“Elia is also the first company in Belgium 

to have signed up to Blue-bike, 

the shared bike scheme at Belgian railway 

stations. Our employees have five 

bikes at their sole disposal at Schaerbeek 

station, enabling them to reach 

our site in Avenue de Vilvorde in just a 



49 

farm in the Baltic Sea owned by the 

generator EnBW, in April 2011, is an 

important milestone for our company 

and demonstrates our commitment to 

the integration of renewables. 

“The diligence and know-how of our 

employees, combined with continuous 

training efforts, help us meet our 

environmental obligations.” 

few minutes. The bikes not only save 

time and money and reduce our environmental 

footprint, but also improve 

our staff’s well-being: scientific studies 

have shown that employees who cycle 

to work are in a better health condition.”

50 



Environmental objectives 

and indicators 

Elia has undertaken to meet certain environmental obligations in relation to its activities, 

especially those concerning the decontamination of polluted soil, waste disposal, the 

installation of transformer tanks to prevent oil discharge, and compliance with noise 

regulations and legislation on greenhouse gas emissions and asbestos. Elia also has a 

duty to set an example in terms of the rational use of energy and the conservation and 

protection of nature. 

Elia must also ensure that its facilities 

and investment projects are accepted 

by the community, in terms of their human 

and environmental impact as well 

as their cost-effectiveness (i.e. their cost 

to the community at large). 

With this in mind, Elia has undertaken 

various initiatives such as planting native 

species in the corridors beneath 

overhead lines, environmental offsetting 

measures and energy audits at highvoltage 

substations and administrative 

sites. 

The main environmental indicators that 

are relevant to Elia’s activities and their 

development over time are detailed 

hereafter. 

LIFE+ Elia: ecological 

management of the 

corridors beneath our 

high-voltage lines 

1. Energy 

REDUCING THE ENERGY 

CONSUMPTION OF ADMINISTRATIVE 

AND TECHNICAL BUILDINGS 

Energy audits were performed in various 

administrative buildings and Elia’s 

existing high-voltage substations. The 

audits led to the establishment of action 

plans which were implemented at three 

of Elia’s ten sites. To reduce heating 

consumption, Elia decided to install a 

new system for switching the heating 

on and off automatically from a mobile 

phone on a trial basis in 25 high-voltage 

substations. This system will mean that 

the temperature is high enough when 

the people who have to work there 

arrive, while also limiting the heating at 

times when nobody is there. 

New buildings adhere to the principles 

of sustainable construction. As a result, 

in 2007 the national control centre building 

was awarded the title of ‘exemplary 

building’ by the Brussels Institute for 

Environmental Management (BIM/IBGE). 

The new administrative building under 

construction nearby (Quai Monnoyer, 

along the Brussels Canal) will not only 

be very energy-efficient (passive building), 

but will also bear the BREEAM 

‘Very Good’ label, awarded to buildings 

that are healthy for their occupants, with 

low grey energy and water consumption, 

and whose plots are developed 

to respect biodiversity. The building 

recently received an award from the 

BIM/IBGE as part of a call for ‘2011 exemplary 

building’ projects, making it the 

second exemplary building constructed 

by Elia.

2. Biodiversity 

JOINT STATEMENT FOR NATURE 

CONSERVATION AND GRID 

DEVELOPMENT 

Various transmission system operators, 

including the Elia Group, TenneT, RTE 

and Terna, and environmental protection 

associations such as the World Wildlife 

Fund, Friends of the Earth and Greenpeace, 

brought together under the 

Renewables Grid Initiative, submitted a 

joint statement entitled European Grid 

Declaration on Electricity Network Development 

and Nature Conservation in 

Europe, to the European Commissioner 

for Energy Günther H. Oettinger. 

The aims of the joint statement are to 

generate consensus around crucial grid 

expansion with a view to integrating renewables, 

to combine grid development 

and nature conservation, and to encourage 

transparency and public dialogue. 

Joint statement 

LIFE+ Elia Project 

IMPACT OF OVERHEAD LINES 

ON AVIFAUNA 

At the request of Elia, Natagora and 

AVES are conducting a study to more 

successfully identify the collision and 

electrocution risks posed to birds by 

overhead lines. The Research Institute 

for Nature and Forest (INBO), Bird 

Protection Flanders (Vogelbescherming 

Vlaanderen) and the Flemish association 

Natuurpunt are also taking part in the 

study. Provisional results demonstrate 

the need to improve the visibility of 

overhead lines in areas where waterfowl 

and certain rare species are present. In 

general, birds face practically no risk of 

electrocution because of the difference 

between the distance separating 

our conductors and the wingspans of 

the most common species. The study 

will identify which measures should be 

taken or which areas should be avoided 

for new projects. 

The report and an accompanying map 

are scheduled for spring 2012. 

The aims of the joint statement are to generate 

consensus around crucial grid expansion with a view 

to integrating renewables, to combine grid 

development and nature conservation, and to 

encourage transparency and public dialogue. 

There will be scope for this innovative 

pilot to be extended across Europe 

via knowledge-sharing with other 

European TSOs, yielding a potential 

300,000 km of green corridors. 



PLANTING OF TREES AND HEDGES 

51 

AROUND OUR FACILITIES 

This project, which involves planting 

flower meadows and bushes under some 

ten pylons, has been ongoing since 2008 

in collaboration with Faune & Biotopes 

asbl. The areas serve as a refuge for local 

fauna on open farmland. Very positive 

results have already been observed. 

Indigenous defensive hedges (consisting 

of hawthorn, dog rose and blackthorn 

bushes) are planted each year around the 

high-voltage substations to better integrate 

the facilities into the landscape and 

to host the local fauna. Thorny shrubs also 

serve as barriers to discourage intruders. 

By late 2011, a total of almost 12 km 

of indigenous hedges had been planted 

around some 17 Elia high-voltage substations, 

totalling more than 40,000 plants. 

Various plots of land around and 

within high-voltage substations were 

also developed to be more welcoming 

to biodiversity. Depending on the type 

of environment surrounding those plots, 

flower meadows, hedges or borders were 

planted. In 2011, three plots covering a 

surface area of more than 5,000 m² were 

developed. 

Even in urban areas Elia does its best to 

promote biodiversity. As such, various 

green spaces at Elia’s site on Avenue de 

Vilvorde, near the Port of Brussels, were 

completely overhauled to make the area 

more conducive to urban biodiversity 

and to enable easier maintenance without 

the need for weed killer.

52 



BREAKDOWN 

OF CO 2 EMISSIONS 

Fixed assets 54% 

Energy 4% 

SF 6 and refrigeration gas 13% 

Annual procurement 20% 

Trips made by staff 

and visitors 9% 

Waste 0% 

DEVELOPMENT OF FOREST 

CORRIDORS – LIFE+ ELIA PROJECT 

LIFE+ Elia is a five-year European project 

being rolled out by Elia to transform 

some 130 km of forest corridors 

(corridors 50 m wide beneath Elia lines 

in forests, where the vegetation is kept 

low to protect the lines) into fully-fledged 

‘ecological corridors’. Instead of using 

rotary slashers every five to eight years 

(hardly beneficial to biodiversity and 

costly for Elia), Elia is going to restore 

more stable environments under its 

lines (such as bogs, shrubs, grasslands 

managed via grazing, etc.), which will be 

easier, less expensive to maintain and 

more beneficial to biodiversity. French 

TSO RTE has been included in the project, 

so prospective developments can 

be tested in the various climates that 

exist in France. 

For this project, costing €2.55 million, 

Elia is to obtain subsidies of €1.166 

million from the EU (via the LIFE+ programme) 

and €815,000 from the Walloon 

Region (DGARNE). Elia will contribute 

some €460,000 and RTE €110,000. 

As such, this project will involve partnerships 

between private players (Elia and 

RTE), public bodies (Walloon Region) 

and associations (CARAH and Solon). 

Solon asbl will manage the project in 

constant coordination with Elia. 

A ‘best practices guide’ will be produced 

describing the various methods 

of managing corridors and demonstrating 

their financial value. There will also 

be scope for this innovative pilot to be 

extended across Europe via knowledgesharing 

with other European TSOs, 

yielding a potential 300,000 km of green 

corridors. 

Nest boxes are installed on highvoltage 

pylons for kestrel falcons. 

NEST BOXES 

Since its inception in 2001, Elia has installed 

dozens of nest boxes for kestrel 

falcons on the pylons of various highvoltage 

lines. Three nest boxes were 

also put up on particularly high pylons 

to house peregrine falcons. Volunteers 

keep track of births in both Wallonia 

and Flanders. In 2011, 178 eggs were 

counted and 158 young birds were 

ringed. 

3. Emissions and waste 

GREENHOUSE GASES 

Elia recorded its greenhouse gas emissions 

using the Bilan Carbone © method. 

For the sake of completeness, all emissions 

were analysed, including those 

caused by electricity dissipated as heat 

during transmission through the grid. 

Emission source (general) Emissions Percentage 

Energy in buildings 3,170 4.1 

SF 6 and refrigeration gases 9,859 13.0 

Annual procurement 15,241 20.1 

Travel 7,113 9.4 

Waste 238 0.3 

Fixed assets 40,335 53.1 

Total 75,956 100.00

-25% 

A target has been set to 

reduce direct emissions 

by 25% by 2016. 

The overall figures were as follows (excluding 

grid losses): 

In 2011, Elia launched a project to 

reduce its carbon footprint. Action areas 

will address both direct emissions (such 

as staff travel and the energy consumed 

by Elia’s buildings) and indirect emissions. 

A target has been set to reduce 

direct emissions by 25% by 2016. 

SF 6 

SF 6 gas has been used in electrical 

equipment for over 30 years as an electrical 

insulator in high- and very highvoltage 

devices. Gas Insulated Switchgear 

(GIS) is used in densely populated 

areas because it is more compact 

than traditional outdoor switchgear 

which uses air as an insulator. In the 

case of medium-voltage facilities, Elia 

uses mainly vacuum-circuit breaking 

chambers as an alternative to SF 6. This 

alternative is not available for high- and 

very-high voltage devices. 

Elia has drawn up investment and maintenance 

policies to limit the risk of SF 6 loss. 

To this end, manufacturers must guarantee 

a very stringent maximum percentage 

of loss throughout the lifetime of the 

facilities. The maintenance policy keeps 

operations involving compartments containing 

SF 6 to an absolute minimum. The 

volume of SF 6 gas installed in the Elia grid 

(from 36 kV up to and including 380 kV) 

comes to 53.08 tonnes. Consumption 

of SF 6 gas (as a replacement and as a 

top-up in the event of a leak) is tracked 

closely using a system that monitors each 

bottle of SF 6. The SF 6 leak percentage for 

all Elia facilities was 0.70% in 2011. This 

is one of the best results recorded for 

European TSOs. 

Maintenance of facilities containing 

SF 6 is carried out by certified teams in 

accordance with EU Regulation No. 

305/2008. The first Elia employees were 

certified in 2010 on the basis of the 

Flemish Decree of 4 September 2009 

on the certification of technicians with 

the task of recovering fluorinated greenhouse 

gases from high-voltage facilities. 

For certification, Elia provides Synergrid 

(test centre) with access to its experts 

(jury) and the appropriate equipment to 

perform practical tests. 

HAZARDOUS WASTE 

Elimination of PCBs 

Since the end of 2005, none of Elia’s 

equipment has contained more than 

500 ppm of PCB (polychlorobiphenyl). 

Elia has undertaken to decontaminate 

transformers with concentrations below 

500 ppm which are still in operation, or 

to replace those transformers before the 

end of their service life. The funds needed 

to complete this project have been 

earmarked. In 2011, 7 transformers were 

decontaminated by an accredited firm, 

representing 59 tonnes of mineral oil. 

Asbestos 

Small quantities of solid asbestos can 

be found when carrying out works in the 

high-voltage substations. They are then 

put in appropriate bags and brought to 

accredited treatment facilities. 



53 

Batteries 

The installation of batteries, which are 

very common in high-voltage substations, 

requires a permit to be issued. 

Environmental legislation in this area is 

aimed chiefly at preventing possible acid 

leaks from such batteries. Elia is promoting 

the use of dry batteries instead, 

as they involve no risk of leakage. Wet 

batteries now account for just 20% of all 

batteries installed in the grid. 

Accidental soil pollution 

Elia manages over 12,000 plots of 

ground, spread right across Belgium. 

To prevent waste dumping (fly-tipping) 

on this land and protect the surrounding 

environment (soil, ground and surface 

water, etc.) in the event of accidental 

pollution, Elia can call on the services 

of a specialist firm seven days a week 

to remove all contamination as quickly 

as possible. Our operational teams also 

have the appropriate equipment, e.g. 

absorption mats, to intervene on site. 

In 2011, there were 13 interventions 

of various kinds, including one major 

intervention: the elimination of pollution 

in the wake of a fire involving a 380 kV 

transformer at the Bruegel high-voltage 

substation (Dilbeek). The debris and 

oil collected in the recovery tank after 

the transformer was damaged were 

eliminated. Work was also undertaken 

to treat soil polluted by the mineral oil 

around the tank, dispersed while the 

fire was being extinguished. Measures 

to monitor the evacuation of rainwater 

into drainage facilities were stepped up, 

although the collection tanks did their 

job perfectly well.

54 



4. Products and services 

EMPHASIS ON GREEN 

PROCUREMENT 

Elia’s Purchasing and Environment departments 

now include ecological criteria 

in new calls for tender. The procurement 

of more sustainable products is 

a significant action area for companies 

aiming to reduce their environmental 

impact. Indeed, Elia encourages industrial 

players to adopt more responsible 

production methods. Respect for the 

environment has been added as a criterion 

for selecting suppliers and should 

be considered in the same light as price 

or safety. The supplier’s environmental 

policy, the energy consumption of 

the product for its entire service life, 

transparency regarding product components, 

and other factors are taken into 

account. A Green Procurement policy 

has been drawn up covering the areas 

just mentioned. 

LIMITING ENVIRONMENTAL IMPACT 

Noise 

Transformers at high-voltage substations 

generate low-frequency noise, the 

level of which must comply with legally 

defined values, according to the area’s 

designated land use as stipulated in 

the land-use plans. Whenever changes 

or extensions are made to its facilities, 

Elia uses simulations to ensure that the 

prevailing values are not exceeded and 

makes any appropriate adjustments. 

Elia follows up on all noise-related 

complaints from local residents. Such 

complaints may relate to noise generated 

at high-voltage substations or by 

electrical conductors, mainly when there 

is fog or heavy rainfall. In 2011, four 

complaints were made about highvoltage 

substations. Noise studies and 

simulations were conducted for three 

of them. Remediation studies are also 

underway to limit noise in relation to a 

number of previous complaints. 

TRANSFORMER TANKS 

Since transformers contain large quantities 

of mineral oil, new equipment is 

systematically installed in a watertight 

tank with an oil-water separator to 

prevent environmental pollution in the 

event of a leak. In addition to separators, 

Elia is installing coalescence filters 

to guarantee compliance with surface 

water quality environmental standards in 

the event of a leak. 

In Flanders, in the wake of the Vlarem 

legislation, all existing transformers must 

be fitted with a tank if they are upgraded, 

modified, replaced or moved. In Wallonia, 

all existing transformers will have to be fitted 

with a tank and a hydrocarbon separator 

by 2015. An investment programme 

was established in 2004 for 540 voltage 

transformers and 800 backup or earthing 

transformers. The programme was updated 

in 2011 and includes an additional investment 

budget of €8,000,000 over five 

years. In 2011, 28 power transformers 

and 28 auxiliary and earthing transformers 

were fitted with tanks, representing an 

investment of €1,000,000. 

SOIL POLLUTION 

Since Elia was set up, soil studies have 

been conducted on over 200 sites 

across Flanders, in accordance with 

Flemish soil legislation. These studies 

showed that our transformers, though 

potentially responsible for local soil 

pollution, posed little or no risk to the 

environment. At sites where significant 

soil pollution was observed, this had 

been there previously and was the result 

not of electricity transmission activities 

but rather of earlier or nearby industrial 

activities (gas plants, blast furnaces, 

chemicals, etc.). Decontamination of 

the Lier high-voltage substation was 

carried out this year and approved 

by the Flanders Public Waste Agency 

(OVAM). Decontamination of the Ruien 

high-voltage substation was carried out 

over seven months while the substation 

remained operational. Decontamination 

of the Wilsele substation was temporarily 

suspended with a view to integrating 

a development project at the site. In late 

2011, three decontamination projects 

were rolled out (for the Merksem site, 

the Langerbrugge substation and 

the Zwevegem substation which has 

been classified). The Merksem decontamination 

project was approved in late 

December.

Soil legislation was implemented in the 

Brussels-Capital and Walloon Regions 

after Elia was established. Elia anticipated 

said legislation by conducting 

analyses and studies in several of its 

high-voltage substations. It has thus 

ringfenced the future costs of potential 

decontamination projects which 

are updated in accordance with the 

changing legislation. In 2011, a proposal 

was made to the Brussels Institute for 

Management of the Environment (IBGE/ 

BIM) regarding the management of 

pollution risks relating to heavy metals 

for Elia’s new site at Quai Monnoyer. For 

the Ville-sur-Haine site, Elia was able, 

under Article 92bis of the Walloon Soil 

Decree, to submit a decontamination 

proposal via a special procedure. At the 

request of the Walloon Waste Bureau, 

additional tests were performed and a 

decontamination proposal can be made 

from early 2012. 

ELECTRIC AND MAGNETIC FIELDS 

The magnetic field produced by the 

electricity system has a very low frequency 

(50 Hz), much lower than that 

used by mobile phones and microwaves 

for example, and its intensity declines 

rapidly the further you move from the 

source. 

There are concerns amongst the public 

about the potential impact of magnetic 

fields on human health. International 

scientific studies carried out over the 

past four decades have not established 

a correlation between 50 Hz magnetic 

fields and health problems. Concerned 

about its responsibility for its employees 

and society, Elia has been actively 

contributing to the advancement of 

scientific knowledge on this subject. 

In 2009, it renewed its cooperation 

agreement, including full guarantees of 

scientific independence, with various research 

centres and universities forming 



Concerned about its responsibility for its employees 

and society, Elia has been actively contributing 

to the advancement of scientific knowledge on 

electric and magnetic fields. That’s why it concluded 

a cooperation agreement with various research 

centres and universities forming part of the Belgian 

BioElectroMagnetic Group (BBEMG). 

55 

part of the Belgian BioElectroMagnetic 

Group (BBEMG). The BBEMG studies 

the effects of electric and magnetic 

fields generated by the transmission and 

use of electrical energy at work and in 

our day-to-day lives. In addition, Elia has 

access to the results of high-level international 

research in the field through the 

Electric Power Research Institute in the 

United States. 

Elia also measures magnetic fields on 

site at the request of local residents. It 

received more than 250 such requests 

in 2011, resulting in some 200 field 

measurements.

56 



In the absence of specific Belgian 

legislation in this area, Elia applies the 

European recommendations issued by 

the International Commission on Non- 

Ionising Radiation Protection (ICNIRP) 

and the Council of the European Union. 

When planning new investments, magnetic 

fields are simulated at the study 

phase. The area in which the magnetic 

field of overhead lines has an effect can 

be reduced through new technologies 

such as the compact arms of pylons. 

Furthermore, Elia avoids inhabited areas 

as much as possible when building new 

facilities. 

ENVIRONMENTAL STUDIES 

Strategic environmental assessment 

of the 2010-2020 development plan 

The federal development plan sets out 

the investment programme needed 

to meet future transmission capacity 

needs. The plan has been subject to a 

strategic environmental assessment, the 

aim of which is to identify any potentially 

significant effects that might support the 

decision between defined alternatives. 

The impact of the selected alternatives 

is in turn assessed in comparison to the 

existing grid. For instance, when looking 

at impact on biodiversity, all selected 

alternatives affect 4.92 ha of habitat, i.e. 

only 0.75% of the impact caused by the 

existing grid (657 ha). This comparison 

illustrates that the strategy adopted by 

Elia is keeping to an absolute minimum 

the impact of grid developments on archaeology, 

landscapes, views, magnetic 

fields and biodiversity. 

The plan and environmental study 

were discussed in a public consultation. 

Some 17 responses were made by 

individuals, professional federations and 

public authorities. Significant remarks 

were taken into account in the final 

version of the plan. The federal development 

plan was approved by the Federal 

Minister on 13 November 2011. 

Environmental assessment 

of investment projects 

In 2011, around 100 grid modernisation 

and extension projects were rolled out. 

To obtain the relevant permits, environmental 

studies must occasionally be 

conducted depending on both the specific 

legislation for the relevant regions 

and the type and scale of the project 

in question. In the Flemish Region, a 

formal environmental study (“plan-MER”) 

was approved for the Stevin project 

(380 kV connection between Zomergem 

and Zeebrugge). Since high-voltage 

substations are not automatically 

subject to the “plan-MER”, tests were 

performed for the installation of the 

Horta and Schoondale substations. 

A project-level MER exemption was 

approved for the second circuit of the 

existing Massenhoven-Meerhout connection. 

In the Walloon Region, an environmental 

impact assessment memo 

was drafted for an underground 150 kV 

connection cable between Corbais and 

Basse-Wavre. 

6. Transport 

SMART MOBILITY 

A plan was launched in November 2011 

to improve mobility. It covers a wide 

range of actions intended to facilitate 

trips made by employees, including 

both commuting and travel during working 

hours. These actions include the 

lending of bikes for journeys between 

railway stations and the workplace, the 

promotion of transit offices enabling 

employees to work close to home 

once or twice a week, the promotion 

of teleconferencing tools, the provision 

of electric vehicles and pool cars, and 

other measures.

Support for environmental 

policies 

DECENTRALISED GENERATION 

In cooperation with the relevant distribution 

system operators and regional bodies, 

Elia is planning for the integration of 

decentralised generation units as part 

of regional sustainable development 

initiatives. 

In Flanders, a number of geographical 

areas have been identified for the 

connection of cogeneration facilities for 

horticultural purposes and of renewable 

energy facilities, most notably at 

Merksplas, Lier and Rijkevorsel. Plans 

to connect an area in the far north of 

the Campine region (Hoogstraten - 

Meer) are currently being examined. 

Spurred on by the Minister for Energy 

of the Flemish Region and in cooperation 

with the Flemish regulator, VREG, 

and the distribution system operators, 

Elia offers connection contracts based 

on the prerequisite of safe operation of 

the grid. Whilst waiting for the Stevin 

project, this approach has released 114 

MW of additional transmission capacity 

for the connection of 27 projects, previously 

on a waiting list. In Wallonia, the 

study conducted by Elia in partnership 

with the ICEDD and APERe revealed 

great potential for accommodating 

wind-power generation in the region 

spanning the south of the province of 

Liège and the north of the province of 

Luxembourg. On the scale of the Walloon 

Region, the potential of the Elia 

grid, without significant upgrading of 

the existing infrastructure, is between 

2,000 MW and 3,000 MW of windpower 

generation. Elia has entered into 

a constructive dialogue with the relevant 

regional authorities about these works 

with a view to devising an optimum grid 

development scenario. 

GFLEX 

GFlex is a flexible procedure for connecting 

wind farms. Field tests were 

performed in 2011 in the East Loop 

region, with the implementation of 

automatic procedures for detecting 

overloads and issuing instructions to 

reduce wind-farm generation. The procedure 

enables the connection of such 

generation facilities with crucial flexibility, 

from the perspective of the generators 

in question and the operational security 

of the electrical system. 

Rational use of energy 

(RUE) and renewable energy 

sources 

PROMOTING RUE AMONGST 

OUR CUSTOMERS 

As part of its public service obligations 

in Flanders, Elia implements an action 

plan each year aimed at encouraging 

Rational Use of Energy (RUE) amongst 

its industrial customers. In this context, 

Elia provides its customers with the 

resources required to make recurrent 

savings of 2.5% on their primary energy 

consumption for each MWh supplied, 



in the case of facilities connected at 

between 36 kV and 70 kV. The objective 

set for 2011 was savings of 37.8 GWh 

of electric power, while savings of 

41.6 GWh have been made. 48 projects 

were introduced and our customers 

undertook to invest in some 44 energysaving 

projects. 

Thanks to the initiatives Elia has taken 

amongst its industrial customers, cumulative 

energy savings since 2003 stood 

at 497 GWh at the end of December 

2011, i.e. some 162,000 tonnes of CO 2 . 

Support for renewable 

energy sources: integration 

of offshore wind farms 

For the offshore wind farms in the North 

Sea that already exist or are under 

construction, Elia is helping to finance 

subsea connection cables to the tune 

of €25 million per connection, applying 

special measures to deal with the 

generation fluctuations associated with 

such units, and purchasing the green 

certificates awarded to them in accordance 

with the relevant legislation. 

OFFSHORE GRIDS: 

57 

A VISION FOR THE FUTURE 

The new Electricity Act, approved in 

late December 2011 as part of efforts 

to transpose the third package of EU 

energy legislation, assigns Elia the role of 

offshore grid operator subject to optimal 

conditions for the community.

58 



In August 2011, anticipating on the Act 

to be published, Elia revealed its vision 

entailing the development of an offshore 

grid in the North Sea. Elia set itself the 

ambitious aim of establishing – in several 

stages – the first North Sea grid, offering 

comparable benefits to onshore grids 

in terms of reliability. It also presented a 

cost/benefit ratio proving that the North 

Sea grid would be more advantageous 

than individual connections to each wind 

farm, as it would reduce the number 

of underwater cables to the shoreline 

and enhance integration with other 

infrastructure projects along the Belgian 

coast. 

The concept – devised in consultation 

with developers of wind farms along 

the Belgian coast – is currently being 

discussed with all project stakeholders 

with a view to setting out concrete 

plans for the installation of two offshore 

platforms, the connection of prospective 

wind farms, and the establishment of the 

required financial and legal framework 

for this major undertaking for Belgium 

and Europe. 

Elia also concluded various cooperation 

agreements to acquire the means and 

resources it needs to play a leading role 

in the development of future wind farms: 

• participation in the ‘Friends of the 

Supergrid’ project, an initiative 

launched in March 2010, which 

brings together various industrial 

actors that join forces to create a 

social, political and regulatory base 

for a future offshore grid; 

Offshore grids: a vision for the future 

Elia’s vision entailing the development of an offshore 

grid in the North Sea set itself the ambitious aim of establishing 

– in several stages – the first North Sea grid, 

offering comparable benefits to onshore grids in terms 

of reliability. 

• participation in the Renewables Grid 

Initiative, geared to boosting power 

generation from renewable sources 

and the transmission capacity required 

for its development; 

• a strategic cooperation agreement 

with Alstom in intelligent systems 

and the integration of renewable 

energy sources; 

• the Eleanore cooperation agreement 

with 3E, Alstom Grid, CG Power 

Systems, CMI, DEME Blue Energy 

and SAG, through Eurogrid International, 

aiming to make an active 

contribution to the development 

of future offshore infrastructure in 

Europe. 

Support for renewable 

energies: green certificates 

Federal and regional legislators have 

developed market mechanisms aimed 

at encouraging investment in facilities 

for generating electricity from renewable 

sources. These include the ‘green 

certificates’ awarded to generators by 

the regulator, vouching for the green 

credentials of their electricity. Suppliers 

produce the certificates annually in proportion 

to their sales, with the proportion 

being set by law. 

As a transmission system operator, Elia 

is required by law to purchase the certificates 

offered to it at a minimum price. 

Elia returns these certificates to the 

market via the power exchange Belpex. 

The balance between the price at which 

Elia purchases the certificates and the 

price at which they are sold on Belpex 

is passed on to the consumers through 

transmission tariffs. 

Under the new mechanism supporting 

renewable energy in Wallonia, the Walloon 

Energy Commission (CWAPE) has 

also obliged Elia to buy back certificates 

offered by individuals with photovoltaic 

panels, at a regulated price. In this particular 

case, certificates bought by Elia 

cannot subsequently be put back on the 

market. The costs will be borne by the 

consumers. 

Germany 

ENERGY 

By constructing new, modern operations 

buildings, 50Hertz is aiming to 

reduce both heating bills and operational 

costs in line with its long-term 

objectives. 

BIODIVERSITY 

Flora and fauna are systematically taken 

into consideration from the planning 

phase of new construction projects, 

and protected as part of the operational 

management of installations. 50Hertz 

cooperates closely with local environmental 

and forestry bureaus.

The 50Hertz control area – which includes 15 GW 

of installed renewable capacity – has a very high 

proportion of decentralised generation. Most of that 

power is generated by wind facilities connected 

primarily to distribution systems. 

ECOLOGICAL MANAGEMENT 

OF OVERHEAD LINES 

A study into the ecological management 

of overhead lines, funded by the European 

Union and conducted in collaboration 

with local partners, helped to establish 

differentiated forest management on 

a regional scale and improved compatibility 

with the landscape. The aim of the 

study is to enhance biodiversity in the 

corridors beneath lines while enabling 

the safe operation of the relevant installations 

and promoting social acceptance 

of overhead lines. A pilot project 

is underway beneath two high-voltage 

lines in the Thuringia region. Once the 

relevant sections of line have been listed 

and mapped out, action plans will be 

drafted. For example, target habitats will 

be defined, as well as implementation 

strategies and proposals for maintaining 

the corridors. 

EMISSIONS AND WASTE 

MANAGEMENT 

As part of its responsible conduct and 

internal monitoring measures, 50Hertz 

has undertaken to support German 

industry’s voluntary commitment to 

reduce emissions of sulphur hexafluoride 

(SF 6). An electronic waste detection 

method, introduced in 2010, was 

applied and optimised as part of efforts 

to decommission and decontaminate 

polluted sites. 

ENVIRONMENTAL EXPENDITURE 

In 2011, 50Hertz established preventive 

measures for the repair of transformer 

oil tanks, and measures to manage 

noise and eliminate residual pollution 

during the construction of new installations. 



59 

DECENTRALISED GENERATION 

The 50Hertz control area – which 

includes 15 GW of installed renewable 

capacity – has a very high proportion 

of decentralised generation. Most of 

that power is generated by wind facilities 

connected primarily to distribution 

systems. To ensure the integration and 

safe transmission of this decentralised 

power to major consumption centres 

in southern and western Germany, 

50Hertz cooperates closely with local 

distribution system operators, for both 

operational and planning purposes. This 

ensures the coordinated development of 

transmission and distribution systems.

03 

Social 

report 

The social dimension is central to the Elia Group’s 

activities. It addresses various aspects and is 

shaped by a commitment to all internal and external 

stakeholders. 


SOCIAL REPORT 

61

62 

ELIA 2010 

SOCIAL REPORT 

The renewable energy market will continue to develop 

– that much is certain. As a result, we urgently need 

to develop not only our regional grids, but also the 

electricity highways that will run between northern 

Germany and industrial centres in the south and west 

of the country. 

Renewable energy: 

a fantastic opportunity for 

our region 

“Renewable energy is a crucial sector 

for the future of Mecklenburg-Western 

Pomerania. Compared with other länder, 

our prospects for wind power, solar 

power and biomass are very good. It is 

truly a fantastic chance for us. 

Local government has clearly recognised 

and proactively encouraged 

opportunities to embrace this avenue of 

development. 

Erwin Sellering 

MINISTER-PRESIDENT OF MECKLENBURG-WESTERN POMERANIA 

“We are leading the way when it comes 

to renewable energy, and should take 

pride in our role. Our region already 

generates almost half of its electricity 

from renewable sources, with wind 

accounting for some 60% of that. Following 

on from Baltic 1, other offshore 

wind farms will be developed along our 

coastline. We are also working to identify 

more onshore wind sites. 

“Our aim is clear: we want to ensure that 

our region generates all its energy from 

renewable sources and also establishes 

itself as an exporter. This would help to 

create more jobs for the future. The development 

of renewable power generation 

necessarily entails the creation of a 

value chain involving thousands of jobs. 

Between now and 2020, around 20,000 

people will build their future careers on 

this sector. 

“The renewable energy market will 

continue to develop – that much is 

certain. As a result, we urgently need 

to develop not only our regional grids, 

but also the electricity highways that 

will run between northern Germany and 

industrial centres in the south and west 

of the country. 

That is why modern, large-capacity 

power transmission systems play such 

a vital role in hitting renewable energy 

development targets. The investment 

they require must also be decently 

remunerated. 

“The strategy adopted by the regional 

government of Mecklenburg-Western 

Pomerania is justified daily by its success, 

and we intend to stick with it.”

Cora Tellmann 

STAFF MANAGEMENT 

I studied economics and management. I joined 50Hertz in 

2009 and followed a training programme there for university 

and technical college graduates. 

“More than 650 people work at 

50Hertz to ensure a reliable and highquality 

power supply. New employees 

arrive at the company in a number of 

ways. Personally, I studied economics 

and management. I joined 50Hertz 

in 2009 and followed a training 

programme there for university and 

technical college graduates. After 

18 months’ training, I joined the HR 

Department. 

Sandra Van Eesbeek 

DIGITAL COMMUNICATION 

“Working for a company like this is 

really motivating and enjoyable. This 

is where the future is being mapped 

out for our modern societies, which 

are becoming increasingly dependent 

on a reliable and sustainable power 

supply. I take part in different projects 

involving HR tools, especially skills development. 

This includes reviewing the 

training programme for young recruits 

and updating the new competency 

model. I was also fortunate enough to 

be involved in the “Power II” project to 

optimise the internal strategy. 

Our competency model serves as a 

basis for a wide range of HR tools 

such as training for employees and 

managers, recruitment, and succession 

and replacement planning. The 

model is vital to the continuous development 

of our employees, which is 

essential in Germany for demographic 

reasons if nothing else.” 

Endeavours like Climbing for Life really help to forge ties 

between participants: facing the same challenge and motivating 

each other in such a way can only boost solidarity. This event 

broadened people’s day-to-day social contacts at work. 

“I was lucky enough to be one of the 

125 employees and partners of the Elia 

Group to climb the Col du Galibier as 

part of the Climbing for Life initiative. 

Although I do sport regularly, a challenge 

on this scale forced me to train 

frequently and push myself to the limit. 

I had to grit my teeth more than once 

and my calves suffered, but the camaraderie 

of the event kept me going. 

“While climbing, I had time to think, 

particularly about the 20 asthma and 

cystic fibrosis sufferers who also took 

part in this challenge. This was a massive 

achievement for them. It was hard 

enough for those of us in good health, 

so just imagine what it must have been 

like for anyone with restricted lung 

capacity! The fact that one of those individuals 

was a colleague of mine from 

Elia only motivated me even more. 

“Endeavours like this really help to 

forge ties between participants: facing 

the same challenge and motivating 

each other in such a way can only 

boost solidarity. We were all working 

towards the same demanding goal, 

and I saw plenty of people egging 

each other on to get to the top 

together. 


SOCIAL REPORT 

63 

The event created a sense of positivity 

and broadened people’s day-to-day 

social contacts at work. 

“And the idea that pushing yourself 

beyond your limits can help to raise 

awareness of issues like asthma and 

cystic fibrosis only serves to reinforce 

the shared sense of achievement.”

64 


SOCIAL REPORT 

Staff policy 

In carrying out its activities, Elia relies on the professionalism and expertise of some 1,785 staff, 

including 1,168 in Belgium, of whom half (49.91%) have joined the company since it was founded 

in 2001, thereby creating an excellent blend of experience and innovation. 

The Elia Group faces a variety of challenges, 

in a constantly and rapidly 

changing energy environment. These 

include the need to: 

• identify and attract young people, 

often in advanced technical disciplines, 

and train them in the specific 

skills needed in its activities – both 

traditional activities, such as highvoltage 

technology and new ones, 

e.g. all the disciplines related to 

smart grids and market operation 

and regulation; 

• ensure career development opportunities 

for staff within the company 

and continue to enhance their skills 

in areas of activity that are changing 

year by year; 

• expand its activities internationally; 

• develop its innovation capacities; 

• anticipate the company’s HR needs 

and expand its skills base to meet 

the challenges of tomorrow’s world; 

• integrate newcomers with older, 

more experienced staff who possess 

valuable knowledge and 

experience; 

• put in place performance management 

mechanisms designed to motivate 

and develop staff according to 

their own personal aspirations and 

the specific needs of the company. 

Against this backdrop, Elia has introduced 

policies on staff recruitment and 

retention, skills management, training, 

mobility and motivation. 

These policies are rooted in the values 

of the company’s mission statement, 

which Elia believes are an essential 

foundation underpinning the way its 

employees should operate, both within 

the company and in their dealings with 

outside players. Those values are: 

• Entrepreneurship: actively seek 

opportunities and show the courage, 

along with others, to take the 

plunge with regard to improvements, 

overhauls or chances to help Elia 

to develop and serve its customers 

better. 

• Empathy: be open and attentive to 

the feelings and opinions of others 

and demonstrate your desire to 

understand them while maintaining 

your own authenticity. 

• Integrity: be open, loyal and honest 

to others, respecting them and their 

professional ethics. Make commitments 

and keep your word. 

• Responsibility: be aware of the 

importance of your work and hence 

carry it out successfully using the 

appropriate resources, while at the 

same time respecting others and 

organisational constraints and accepting 

the consequences of your 

actions. 

Recruitment 

Elia took on 111 new employees in 2011 

in the wake of both retirements and the 

creation of new positions. 

The proportion of employees with more 

than 10 years’ seniority has fallen gradually 

from 68% in 2002 to 52.31% in 2011. 

Women account for 18.84% of staff and 

are playing an increasingly significant 

role in key jobs for the Group’s strategy 

and future.

COMPOSITION OF THE ELIA STAFF 31/12/2011 

Top Employer 2012 

In 2011, for the fifth year in a row, Elia 

took part in the Top Employer survey organised 

by the independent experts at 

CRF (Corporate Research Foundation) 

and once again won the coveted title 

of Top Employer for 2012. Five criteria 

are considered in the selection process: 

primary working conditions, training opportunities, 

internal promotion opportunities, 

secondary working conditions 

and corporate culture. The title, which 

was awarded to 45 Belgian companies, 

is a further boost to Elia’s profile as a 

leading employer on the labour market. 

Job fairs 

As in previous years, job fairs were a 

particularly useful aid to Elia’s recruitment 

activities. In 2011, in addition to 

traditional fairs, Elia took part in a job 

fair on board a train travelling through 

seven major Belgian cities with a view to 

meeting student engineers. The initiative 

went down very well with students. 

Attending these events allows Elia’s 

recruitment specialists to meet talented 

young people. Selected candidates 

are then invited to take part in the first 

phase of the recruitment procedure. 

Men Women Total FTE 

Partnerships with schools 

and universities 

Elia’s areas of activity, especially those 

relating to high-voltage technology, are 

not necessarily well catered for in school 

and university curricula. For this reason, 

Elia has developed a partnership policy 

with educational establishments to offer 

significant added value to universities 

and technical colleges and enable 

students to gain practical experience in 

the various disciplines associated with 

operating a transmission system. This 

is a very valuable learning experience 

for students and is a chance for Elia to 

attract young people to the company. 

Elia Challenge 

Each year, students from a number of 

technical colleges have the chance to 

complete an end-of-college project on a 

subject relating to high voltage with the 

aid of Elia specialists. 

The programme includes a visit to a 

high-voltage substation and completion 

of a project on technologies used in 

high-voltage grids and Elia’s activities. 

The colleges receive assistance from 

Elia in the form of financial support. The 

projects are then presented to members 

of Elia’s management. 


SOCIAL REPORT 

Elia 50Hertz Elia 50Hertz Elia 50Hertz Elia 50Hertz 

Management 7 6 0 0 7 6 6.5 6 

Supervisory staff 305 58 77 11 382 69 375.8 68.5 

Employees 636 462 143 138 779 600 755.53 597.4 

Total 948 526 220 149 1,168 675 1,137.83 671.9 

65 

Technical Education Trophy 

For a number of years, Elia has organised 

a Technical Education Trophy 

aimed at educating secondary school 

students in scientific and technical 

subjects. 

The Trophy was revamped for the 2010- 

2011 academic year as Elia decided to 

place the initiative within the broader 

context of the Young Belgian Scientists 

initiative. In this context, upper secondary 

school students from all sections 

were contacted and invited to work on 

a scientific or technical project which 

they presented at the Science Expo on 

29 and 30 April 2011 at Tour & Taxis 

in Brussels. The event featured more 

than 200 projects from all over the 

country, 17 of which were in competition 

for the Elia Trophy. In the year 5-6 

category, first prizes were awarded to 

schools from each language community: 

Broederschool Sint-Niklaas for 

‘Wind turbine’, and Centre scolaire Eddy 

Merckx for ‘What can be connected to 

a dynamo?’. In the year 3-4 category, 

the first prize was awarded to pupils at 

Notre-Dame Immaculée d’Evere for their 

project ‘From batteries to rechargeable 

batteries’. The panel also decided to 

award a special prize to a second-year 

class from Sacré-Cœur de Linthout for 

its project ‘This is not just wind’.

66 


SOCIAL REPORT 

Elia has developed a partnership policy with 

educational establishments to offer significant 

added value to universities and technical 

colleges and enable students to gain practical 

experience in the various disciplines associated 

with operating a transmission system. 

Elia also set up a fun learning stand, 

focusing on the electricity transmission 

system and operated by field staff. 

The stand aroused the enthusiasm and 

curiosity of the young people. 

Student work placements 

Elia conducts a policy of student work 

placements for final-year secondary 

school, college and university students. 

Such placements allow students to get 

to know the company and its activities. 

By talking to Elia staff and experiencing 

the working environment, they may 

discover a real passion for our line of 

work. Student work placements are 

also an ideal springboard to subsequent 

employment with Elia. 

Skills management 

Elia bases its skills management policy 

on a skills catalogue which includes five 

generic skills, defined for all Elia staff in 

line with the company’s values. Skills 

are generally analysed at various stages 

of an employee’s career: in the appraisal 

when an employee is hired or changes 

jobs, in the development interviews for 

both managerial/supervisory staff (the 

Midyear Review held each summer) and 

employees (during the annual Jobdate), 

as well as in the training provided to 

develop specific skills, and so on. 

For managerial/supervisory staff, a 

number of extra specific skills have been 

defined for each job family. For employees 

hired after 2002, the skills are 

supplemented with a description of the 

tasks specific to each job category. Various 

operational divisions also defined 

catalogues of specific technical skills. 

Both the managerial/supervisory staff 

and employees hired under the new 

staff rules are subject to a Performance 

Management process, including an 

interview at the start of the year to lay 

down the objectives that have to be met 

and the activities that have to be carried 

out, an appraisal interview at the end of 

the year and a development interview. 

For employees hired under the old staff 

rules, there is currently only a development 

interview.

At Expo Sciences, secondary 

school students learned about 

the activities carried out by 

power transmission system 

operators, mainly in the form of 

fun learning boards. 

Training 

Elia offers its employees a wide range 

of training. Detailed in a mini-catalogue, 

the courses on offer include training 

on behavioural skills, such as assertive 

communication, and training related to 

Elia’s activities, including the Campus 

Elia training course, the Elia Business 

Game with its individual versions for 

specific target groups (middle management, 

foremen at Grid Services, etc.), 

the Elia’s Activities training course and 

language classes. The IT Department 

also offers specific training on IT and associated 

tools. In addition, training pathways 

have been established for certain 

target groups including junior managers, 

middle managers, assistants to senior 

managers, newcomers to particular 

departments and project managers. In 

addition, Elia allows staff to take part in 

external training programmes (e.g. at 

the Vlerick Leuven Ghent Management 

School), subject to certain conditions 

(motivation for application, compliance 

with entry criteria, etc.). 

Technical training 

Elia has established a wide range of 

technical training programmes so as to 

continuously improve the skills of its field 

staff, who play a crucial role in safely 

managing the grid and ensuring supply 

quality in Belgium. Elia is currently 

working on an integrated skills management 

and monitoring system, which will 

provide added support for the training 

programmes. 

Training in figures 

Based on the various catalogues of 

existing skills, Elia is planning new training 

programmes to meet the Group’s 

increasingly specialist needs. 

In addition to the basic training required 

for our professional activities and safety 

compliance (certification training, training 

modules tailored to different target 

groups, etc.), new training programmes 

are being established focusing primarily 

on technological developments. Training 

procedures have also been defined to 

support internal restructuring within the 

Asset Management Department in 2011. 

Average training time per employee 

2010: 54.07 hours 

2011: 37.90 hours 

Learning coverage 

(at least one day of training) 

2010: 73.43% 

2011: 74.23% 


SOCIAL REPORT 

67

68 

Knowledge management 

Knowledge management activities are based on six strategic criteria: acquiring and 

maintaining critical knowledge, managing knowledge loss (departing staff), being equipped 

with appropriate tools and methodologies, learning and measuring, coordinating and 

collaborating with a view to extracting lessons from acquired experience. 

Benchmarks were established with 

Solvay and the French system operator 

RTE with regard to processes, cataloguing 

and loss of knowledge. 

Analyses were conducted with Knoco 

Ltd consultants to gauge knowledge 

and assess knowledge flow. The analyses 

focused on Elia’s two operational 

departments in Belgium: Asset Management 

and Energy & System Management. 

In 2012, after the assessments, 

a general knowledge management 

framework will be established to manage 

best practices at Elia, initially within 

the Safety and National Control Centre 

departments. 

In Germany 


SOCIAL REPORT 

50Hertz Transmission is also keen to 

create an environment to attract and 

train employees with skills in technical 

fields and also in market operation and 

regulation. 

In Germany 

Professionalism is defined as the ability 

of an employee to act appropriately, 

reasonably and responsibly both from 

an individual and social perspective and 

in a wide range of situations. 

Excellence is fostered to ensure employees 

maintain a consistently high level of 

professionalism and motivation and an 

appropriate attitude towards safety. 

Facing the impending departure of staff 

reaching the age limit, 50Hertz has established 

a programme for succession, 

knowledge transfer, leadership development 

and talent management. 

Professionalism is defined as the ability 

of an employee to act appropriately, reasonably 

and responsibly both from an 

individual and social perspective and in 

a wide range of situations. 

An initial staff satisfaction survey to 

develop and improve services and the 

work environment was conducted in autumn 

2011. The participation rate – over 

80% – meant that recorded results were 

largely representative. An action plan 

will be rolled out in 2012 on this basis. 

RECRUITMENT 

On 31 December 2011, 50Hertz 

employed 695 people, including 20 

apprentices and 7 trainees. Women 

account for 22% of the workforce and 

3.3% of 50Hertz staff have a disability. 

Following a significant increase in employee 

numbers as a result of both the 

extensive investment plans already in 

place or scheduled for the near future, 

and the development of new activities 

(Renewable Energy Act and internationalisation 

of the energy market), the 

average seniority has fallen from 21.5 

to 18.1 years and the average age from 

43.9 to 43.1. 

PARTNERSHIP WITH UNIVERSITIES 

AND RESEARCH CENTRES 

50Hertz has established a network 

to facilitate exchanges and long-term 

contact with academic institutions, 

including eight partner universities in its 

geographical area. By way of example, 

partnerships have been entered into 

with the Technical Universities of Berlin, 

Magdeburg and Cottbus. Professors 

with extensive expertise in electricity 

grids, high-voltage engineering and

Piloting 

decision 

M1 

Perimeter: 

act oncurrent 

and future 

knowledge 

M2 

Knowledge securing 

Manage the risk 

associated with the 

loss of knowledge 

energy legislation can thus attract 

young talents to 50Hertz Transmission’s 

areas of activity. To strengthen these 

ties, a chair was created in 2010 at the 

University of Cottbus, which boasts a 

leading Research and Development 

Department. Exchanges between 

50Hertz Transmission and the academic 

teaching staff are stimulated by lectures 

and visits to research premises and 

operational sites. 50Hertz also offers 

students opportunities to deepen their 

knowledge and acquire professional 

experience through work placements, 

seminars and final dissertations. 

M3 

Knowledge Content 

Knowledge base and 

social networks 

Go/No Go 

decision 

M4 

Benchmark 

processes, audit, 

monitoring 

KNOWLEDGE MANAGEMENT 

Due to the technical nature and complexity 

of management activities relating 

to the power transmission system, 

vocational training and skills development 

are also priorities at 50Hertz. Work 

is also underway to draft a policy for the 

management of high-potential employees 

in line with the needs of 50Hertz. 

The policy is scheduled for implementation 

in 2012. 

By redefining skills management and 

updating the long-term succession programme, 

the Power II project will help 

the company to cope with significant 

demographic challenges and the general 

decrease in the active population. 

M5 

Extent 

Collaboration 

Interface with 

universities 

and experts 

PILOTING 2011/2012 DEPLOYMENT 2013/2015 


SOCIAL REPORT 

M6 

Capturing and 

using lessons from 

experience 

69 

The number of technical apprenticeship 

contracts will also be increased. Such 

apprentices continue to work for at 

least one year in the company after they 

have completed their apprenticeships. 

Several trainees and PhD students were 

also recruited in 2011.

70 


SOCIAL REPORT 

Employee safety and welfare 

The Elia Group prioritises the safety and welfare not only of its employees and the personnel 

of companies with which it works but also of its customers and the public as a whole. 

The company makes sure that its facilities are as safe and reliable as possible. 

Elia has set a target of zero accidents or incidents on the basis of four action areas. 

1 - Welfare policy 

as a key aspect of the 

company’s management 

responsibilities 

Elia includes risks assessment techniques 

in its management, management 

systems, procedures and activities. 

As such, safety is integrated at source 

into both our infrastructure and our work 

processes and methods. 

2 - Continuous training 

and coaching 

Training, education and the continuous 

involvement of employees in both operational 

safety risks and corporate risks 

help to support and consolidate the establishment 

of constant risk awareness 

as a part of the corporate culture. Elia’s 

training programmes are based not only 

on solid theory, but also practical implementation 

and feedback from the field. 

They include the provision of technical 

training as well as basic safety training 

for line managers and employees. Informal 

learning in the workplace also helps 

to identify strengths and weaknesses, 

which can then be taken into account 

in the efforts to prevent accidents and 

incidents. 

3 - Embedding safe conduct 

in the corporate culture 

This approach calls for involvement at 

all levels of the company (line management, 

foremen, committees and employees), 

compliance with work methods, 

procedures and instructions and 

the notions of order and cleanliness. 

The principles of the Stop-Think-Act-Review 

(STAR) safety campaign contribute 

to safety in the workplace and at home, 

when organising work and in the event 

of unforeseen circumstances. The involvement 

of the CEO, the Management 

Committee and line management, both 

in the field and via action programmes, 

is a vital part of embedding the safety 

reflex in the corporate culture. 

4 - Performance 

Management and 

operational monitoring 

Safety and security help to ensure 

the effectiveness and quality of our 

activities. Elia strives to follow up and 

continuously improve its safety results 

through monitoring and objective assessment, 

based on universally agreed 

and relevant indicators. 

Safe conduct must also be integrated 

into employee Performance Management 

and must entail key aspects such 

as personal development and career 

advancement. 

Health 

In addition to mandatory check-ups 

under occupational health obligations 

(assessment of individual health risks), 

all members of staff are given access 

to flu vaccines. In 2011, Elia also helped 

to raise awareness of the importance 

of good diet and the potential impact of 

alcohol- and drug-related issues.

Results 

In recent years, the continued efforts 

undertaken by Elia with a view to systematically 

improving the level of safety 

– through the active implementation 

of the Plan–Do–Check–Act principle – 

have produced excellent results, making 

Elia one of the safest industrial companies 

not only in Belgium, but also in 

Europe. 

These results vindicate the approach to 

the intrinsic safety of the facilities as well 

as to operational safety in carrying out 

our activities. 

Moreover, these results fully justify the 

Elia Group’s belief that ‘any accident is 

one accident too many’, since aiming to 

prevent even the smallest of accidents is 

the best way to avoid serious occupational 

accidents. A minor oversight or an 

innocent fall can have unfortunate consequences. 

Our employees have managed 

to drastically reduce accidents 

due to slipping and falling by never 

losing sight of this principle, through 

concrete action and awareness-raising 

campaigns about cleanliness in our industrial 

facilities, workshops and offices. 

Daniel Dobbeni, CEO 

“Our safety objective in the Elia Group is zero accidents. 

The reason is simple: the severity of an accident – and its 

potential impact on the health of our employees – cannot be 

known in advance. 

Therefore, any accident – whether it involves you or your 

colleagues or occurs at or outside work – is one too many. 

Establishing a permanent safety reflex is our only option, and 

putting it into practice depends entirely on us.” 

In 2011, a number of events, including 

a fluid accident, proved that positive 

safety results can be maintained only 

through constant vigilance and continuous 

critical assessment of not only our 

rules, procedures and instructions, but 

also how they are applied and adjusted 

to ever-changing real-life situations. 

Safety and welfare of 

subcontracted staff 

To encourage the safety reflex amongst 

subcontractors and reward their positive 

safety results, various objective safety 

and quality parameters have been 

incorporated into both the organisation 

and implementation of activities in the 

field. These parameters are then taken 

into account when selecting contractors 

and outsourcing work. The results 

are evaluated and discussed with the 

subcontractors in a spirit of dialogue. 

The approach of existing and potential 

subcontractors to quality and safety is 

also audited. An action plan is defined 

as and when necessary to raise the level 

of their operation and results to the level 

Elia is looking for. And end is put to the 

cooperation with subcontractors who 

do not adequately follow safety policy 

or do not attain the required level for 

safety-related parameters and results. 


SOCIAL REPORT 

71 

Wider commitment to safety 

Elia Group employees and its subcontractors’ 

staff are not the only ones 

who are required to heed the potential 

risks of high-voltage infrastructure: the 

same goes for anybody going near our 

facilities. At the request of various fire 

brigades, Elia organised sessions dealing 

with the specific risks and the safety 

measures to be taken during emergency 

activities near our facilities. Elia also 

regularly makes its facilities available to 

emergency teams and services so that 

they can conduct exercises in the most 

realistic possible context. Preventive 

actions were also undertaken in the 

construction sector in collaboration 

with the National Action Committee for 

Health and Safety in the Construction 

Industry (CNAC/NAVB). In this connection, 

around 20 advisors were trained in 

the safety risks posed by our facilities in 

their activities. Awareness-raising activities 

were also organised with FedBeton 

(Belgian Federation for ready-mixed 

concrete).

10 

8 

6 

4 

2 

0 

72 

Frequency and 

severity rates 

A total of seven accidents leading to 

incapacity for work were recorded for 

around 16,950 interventions in the field, 

including a fluid accident – which could 

have been avoided through compliance 

with procedures and the use of available 

personal protective equipment at the 

time – and a commuting accident involving 

an unhitched trailer from another 

vehicle. 

AWARENESS-RAISING CAMPAIGN 

Various campaigns were organised in 

2011 to raise awareness of the importance 

of good diet and the potential 

impact of alcohol- and drug-related 

issues. 

ELIA FREQUENCY RATE ELIA SEVERITY RATE 

2,7 

2007 


SOCIAL REPORT 

5,1 

2008 

2,8 

2009 

1,7 

2010 

4,6 

2011 

0,5 

0,4 

0,3 

0,2 

0,1 

0,0 

Elia 

0,03 

2007 

0,10 

2008 

0,14 

2009 

0,01 

2010 

0,28 


Elia

To encourage the safety reflex amongst 

subcontractors and reward their positive safety 

results, various objective safety and quality 

parameters have been incorporated into both the 

organisation and implementation of activities in the 

field. These parameters are then taken into account 

when selecting contractors and outsourcing work. 

In Germany 

OCCUPATIONAL HEALTH AND SAFETY 

50Hertz came close to the target of zero 

industrial accidents in 2011. Occupational 

health and safety is an integral 

part of the company and a key objective. 

The Shopper fall-protection system, 

developed in cooperation with 50Hertz, 

is due to be certified soon by the relevant 

inspection body. The system was 

developed by 50Hertz staff (lines team) 

and managers from the professional association 

of which 50Hertz is a member. 

The new system will help to enhance the 

safety of line mechanics. 

Work clothing and individual protective 

equipment were also improved and are 

used by members of staff to provide 

maximum protection. Subcontracted 

staff must be registered and certified 

with regard to safety. This contributes 

to meeting the appropriate qualification 

of all workers in the field of occupational 

safety. A questionnaire was also drawn 

up for subcontractors in cooperation 

with the Purchasing Department, to assess 

their occupational safety. 

A contract was signed with the German 

occupational health association (BAD) 

to provide counselling to employees 

and management. The relevant services 

are available to anybody experiencing 

work-related psychological issues. The 

programme is supported by employee 

representatives. Cooperation with these 

services was optimised and the bond of 

trust strengthened. 


SOCIAL REPORT 

73 

ACCIDENT STATISTICS 

One occupational accident was recorded 

in 2011 leading to 9 days of incapacity 

for work - a remarkable achievement 

and a sign of the efforts undertaken in 

that area. 

Some eight commuting accidents were 

recorded, mainly due to poor weather 

conditions. No serious injuries were 

sustained. 

19 employees of companies working for 

50Hertz sustained minor injuries during 

working hours.

74 


SOCIAL REPORT 

Corporate social responsibility 

The Elia Group plays a crucial role in community welfare, the economic success of its 

companies and the success of various other organisations. To this end, Elia is a socially 

responsible company in all its activities: 

• supporting European, federal and 

regional energy and climate targets; 

• ensuring the integration of green energy 

in our grids, including offshore; 

• developing tomorrow’s grid in the 

most cost-effective way for the community; 

• ensuring permanent dialogue with 

all stakeholders in our activities: 

customers, employees, people living 

near our facilities, students, the 

general public; 

• maintaining and developing the grid 

in an environmentally friendly and 

cost-effective way for the community; 

• undertaking various social initiatives 

in both Belgium and Germany; 

• promoting technical and scientific 

studies for young people; 

• and many other activities. 

Elia is also a member of Business & 

Society, the benchmark for corporate 

social responsibility (CSR) in Belgium, 

and provides support and resources to 

companies aiming to incorporate social 

responsibility into their management 

and activities by: 

• sharing best practices; 

• developing new CSR solutions; 

• sharing information on various aspects 

of CSR with stakeholders. 

Awareness branding 

campaign 

The Elia Group wants its various stakeholders 

to understand the importance 

of what it does, among other things, for 

the economy and the community. To 

this end, in 2008 the company rolled out 

a branding campaign, with a view to: 

• coming across as a dynamic employer 

offering good future prospects 

so as to attract the new staff it 

needs to maintain the efficiency and 

quality of its service; 

• gaining the trust of local residents 

and public authorities, sustained by 

a determination to identify the most 

appropriate solutions in a spirit of 

constructive dialogue; 

The Elia Fund is 

aimed at people with 

disabilities in the broad 

sense of the term. 

• gaining the confidence of investors 

so as to have the capital for the 

investments required to safeguard 

the sustainable development of its 

activities; 

• enabling citizens to better understand 

and support Elia’s role in 

implementing energy and environmental 

policy, at federal level and 

within the three regions of Belgium. 

The 2011 campaign revolved around 

two main activities: preparing tomorrow’s 

grids for the challenges posed by 

renewable energy, and creating a European 

electricity market. The campaign 

was rolled out at two key points (June 

and September), using a giant power 

plug as a metaphor for the high-voltage 

grid. Surveys showed a significant increase 

in awareness and understanding 

of the relevant challenges. The European 

Commission cited the campaign 

as an example, and ENTSO-E is looking 

into the possibility of carrying out a 

similar activity at European level.

Elia Fund: wonder and 

discovery for all 

Since it was established, Elia has ensured 

that its mission to promote security 

of supply and the electricity market 

has been reflected on the social front, 

by creating the Elia Fund in cooperation 

with specialists from the King Baudouin 

Foundation. The Foundation – an ideal 

partner for such a project – independently 

and transparently manages the 

Fund in keeping with the company’s 

values. 

The Elia Fund is aimed people with 

disabilities in the broad sense of the 

term (people with a mental, physical 

or sensory disability, older people, 

families with young children, and so 

on) and supports projects that offer 

these individuals transparent and nondiscriminatory 

access to tourist, cultural 

and sporting facilities, in the same way 

as everybody else. The Fund, which has 

an annual budget of some €250,000, 

places an emphasis on ‘wonder and 

discovery’. 

In 2011, the panel of independent 

experts selected 22 projects which 

focused strongly on the integration of 

disabled people in as broad a context 

as possible. 

PROJETS 2011 

€250,000 

The Fund, which has an annual budget of 

some €250,000, places an emphasis on 

‘wonder and discovery’. 

• “Ik adem dus ik ben” - Vereniging 

personen met een handicap (VFG) 

• Kreative und musikalische Kurse 

für Menschen mit und ohne 

eingeschränkter Mobilität - Kreative 

Werkstatt Büllingen 

• Toneel de Kloef - 

Vrijetijdsondersteuningscentra 

Opstap – De Kloef 

• Viactive - ASBL Sports Seniors 

• Samen bergen overwinnen 

- VZW Horizont 

• Quatro avec Tibou - ASBL 

Association des Sourds et 

Malentendants du Tournaisis 

• Proeven van kunst en cultuur 

- VZW Sjarabang 


SOCIAL REPORT 

The 2011 campaign revolved around two main 

activities: preparing tomorrow’s grids for the 

challenges posed by renewable energy, and creating 

a European electricity market. The campaign was 

cited as an example by the European Commission. 

75 

• Le Musée Magritte avec un 

Visioguide - Fédération Francophone 

des Sourds de Belgique 

• Netwerk Aalst - Centrum voor 

hedendaagse kunst 

• Tous à bord - ASBL Génération 

Nouvelle 

• Outdoor: beperkt!? - VZW 

De Stroom 

• Ciné-ma différence - Centre de 

Diffusion Cinématographique 

Montois 

• Personen met een beperking op de 

planken - VZW Sperwer 

• Comment sonne mon handicap ? 

- ASBL Cinetik 

• Therapie op een paardenrug 

- G-Seppe VZW 

• Tous aux plaines de vacances 

- ASBL Badje 

• Kapitein op eigen schip 

- Vormingscentrum Handicum 

• La voile dans un fauteuil 

- asbl ForceDouce 

• Low-budget zomerkampen 

- Jeugdvereniging De Jojo 

• La couleur des Sens 

- ASBL Passe Muraille 

• NTGent overbrugt drempels 

- NTGent 

• Imaginaire du Monstre 

- Atelier Graphoui 

• IJspret voor iedereen 

- St Margaretha vzw 

• DG-Inklusiv - Begleitzentrum 

Griesdeck

76 

Télévie 


SOCIAL REPORT 

In 2011, as in previous years, operational 

staff managed to persuade quite 

a number of employees, friends and 

family members to lay aside their fears 

and climb one of Elia’s high-voltage 

pylons (not connected to conductors 

of course). The aim of this initiative is to 

raise funds for cancer research as part 

of Télévie. The event is carefully supervised 

by both Elia professionals and a 

group of volunteer para-commandos 

from the Mons area to ensure the safety 

of the participants. 

International wheelchair 

tennis tournament 

For the third year in a row, Elia supported 

the Belgian Wheelchair Tennis Open. 

This wheelchair tennis tournament 

brings together internationally renowned 

sportsmen and shows how sport contributes 

to the integration of people with 

reduced mobility. 

Climbing for Life 

More than 100 Elia Group employees 

from Belgium and Germany and a number 

of customers took on the challenge 

of the Col du Galibier, the legendary 

climbing stage of the Tour de France. 

The aim of the initiative, launched by 

Flemish Minister-President Kris Peeters, 

was to raise awareness and funds for 

people with asthma and cystic fibrosis. 

The event gave participants the chance 

not only to push themselves harder 

than ever before, but also to socialise 

in a different setting, forge new ties, get 

to know themselves and others, and 

establish a network which they could 

potentially use in their professional lives. 

Museum aan de Stroom 

Elia formed a partnership with the 

Museum aan de Stroom (MAS), which 

opened in Antwerp in May 2011. The 

company will use the museum to 

promote its activities in connection with 

the Métropole social theme, thereby 

boosting its profile, especially among 

potential young recruits. This will enable 

Elia to firmly establish itself in the Antwerp 

region which is home to a number 

of major customers as well as the 

company’s administrative headquarters 

for Flanders. 

Company visits 

Elia organises guided visits for interested 

groups, featuring a presentation of 

the company followed by a visit to 

a control centre and a high-voltage 

substation. These visits allow people to 

find out about the transmission system 

operator’s activities. They usually take 

place at Elia’s premises on the site at 

Avenue de Vilvorde in the Brussels port 

area, which is also home to the Elia 

Training Centre and the national control 

centre. Requests can be made to elia@ 

znz.be. 

In Germany 

Whether it involves climbing 

a high-voltage pylon (under 

supervision) or scaling the 

Col du Galibier (the legendary 

stage of the ‘Tour de France’), 

Elia takes part in a number of 

events in which participants 

push their boundaries for the 

benefit of the community. 

In keeping with its values, 50Hertz 

Transmission showed its commitment 

to community welfare and sustainable 

development by supporting various 

projects for the conservation of nature 

and the environment, as well as social 

initiatives geared towards young 

people. In 2011, 50Hertz established a 

partnership with the world-renowned 

Konzerthaus Berlin and supported 

concerts by the talented young cellist 

Sol Gabetta. By promoting the revival 

of the traditional autumn crosscountry 

run Rennsteig-Herbstlauf in 

Thuringia, 50Hertz also confirmed 

its social commitment in a region 

where significant grid extensions are 

scheduled. 50Hertz is also the main 

partner of the Windstärken (Wind 

Forces) exhibition which began in 

autumn 2011 at the German Museum 

of Technology. The aim of the exhibition 

is to raise public awareness of the 

scientific, technological and economic 

impact of wind on electricity.

Stakeholder relations 

Elia engages in open and transparent dialogue with its customers, suppliers, 

shareholders, potential investors, authorities and the community at large, as well as 

with Group staff members. 

Relations with suppliers 

Elia aims to build up a long-term, mutually 

beneficial relationship with its suppliers. 

Its procurement policy is therefore 

based on the following principles: 

• an objective selection and award 

procedure; 

• compliance with Belgian and EU 

legislation; 

• a constant quest for new partners 

and innovative solutions; 

• a preference for suppliers that support 

our goal of operating, maintaining 

and developing a secure and 

reliable electricity system; 

• a preference for suppliers that 

provide the best possible service to 

both external and internal customers; 

• a preference for suppliers that use 

their knowledge and experience to 

reduce our costs by minimising the 

total cost of ownership; 

• a preference for contracting work 

and framework agreements in which 

the purchase of goods is linked to 

the provision of the corresponding 

services and the continual qualification 

of suppliers; 

• a preference for results-based commitments 

(or service level agreements) 

rather than means-based 

commitments; 

• continuous assessment and 

improvement of quality, individual 

safety and the environment. 

Relevant certification (SCC, BeSaCC, 

ISO9001, ISO14000, and so on) is an 

important criterion in the selection of 

suppliers. 

Relations with investors 

The task of the Investor Relations Department 

is to ensure transparent communication 

with financial analysts and 

current and potential investors. Two-way 

communication between investors and 

management has been established to 

comment on the company’s results, 

strategy and decisions and to understand 

the concerns of shareholders and 

analysts as well as the perception of the 

market. 


SOCIAL REPORT 

77 

More than ten roadshows were organised 

with the CEO and CFO for the 

benefit of the hundred or so institutional 

investors in Europe’s major financial 

centres. The Group also took part in the 

Belgian Excellence Investment Seminar 

co-organised by NYSE and ING in New 

York. In between roadshows, investors 

and analysts had a chance to talk 

to the CEO or CFO, either in person or 

by video conference. In addition, the 

Elia Group attended many national and 

international investment conferences as 

well as the annual events organised by 

the Vlaamse Federatie van Beleggingsclubs 

en Beleggers (VFB). Elia’s financial 

newsletter ‘Investor News’ provides 

investors with up-to-date information 

about the company on a regular basis.

78 


SOCIAL REPORT 

Relations with employees 

INDUSTRIAL RELATIONS 

Sectoral agreements 

To fulfil its role in Joint Committee 326, 

Synergrid (of which Elia is a member) 

provides various support and consulting 

services on social issues for its members, 

including: 

• drawing up transitional procedures 

for collective labour agreements 

concluded at sectoral and company 

levels; 

• support for employers’ organisations 

to prepare for the social dialogue; 

• assistance for members in finding 

solutions to any industrial disputes; 

• management of sectoral joint bodies. 

Following the establishment of a draft 

cross-industry agreement in early 2011, 

the caretaker government introduced 

a number of implementing measures 

at national level, such as the maximum 

wage increase of 0.3%. The discussions 

will be continued in 2012. 

A collective labour agreement was 

signed on training activities in sectoral 

companies. Within Joint Committee 

218, a sectoral collective labour agreement 

was signed on 24 June 2011 on 

purchasing power, mobility, training, 

early retirement and time credits. 

Group-level agreements 

Company labour agreements were concluded 

for the transposition of collective 

labour agreement 90 (bonus linked 

to achievement of a set of collective 

results) at Elia and Elia Engineering. The 

joint works council (Elia System Operator, 

Elia Asset and Elia Engineering) met 

regularly in 2011. It was provided with 

detailed information on the financial and 

economic situation of the Elia Group, 

and at the annual extraordinary works 

council meeting. 

Elia’s three committees for prevention 

and protection at work (CPPTs) and Elia 

Engineering’s CPPT met regularly, separately 

or jointly, with particular regard 

to the welcoming of new employees 

and the 2012 annual action plan for 

safety. On the initiative of the CPPTs, 

the joint working group for ‘collective 

labour agreement 100 – alcohol and 

drug abuse prevention policy’ drafted a 

prevention policy on the consumption 

of such substances at work, approved 

by the Works Council meeting of 17 

October 2011 and annexed to the work 

regulations. 

On 19 September 2011, the following 

collective labour agreements were 

signed: 

• a collective labour agreement under 

the terms of which a single trade 

union delegation would be established 

as from 1 October 2011 for 

Elia Asset and Elia System Operator, 

following restructuring within Asset 

Management; 

• a collective labour agreement under 

the terms of which Elia Asset, Elia 

System Operator and Elia Engineering 

would form a single technical 

operating unit after the 2012 social 

elections, for the Works Council, and 

for the Committee for Prevention and 

Protection at Work. 

The dialogue with employee representatives 

was constructive, and no social 

conflicts arose. 


50Hertz Transmission maintains close 

and constructive relations with employee 

representation bodies through the 

‘Mitbestimmung’ (co-decision) system. 

In 2011, employee representatives were 

closely involved with the POWER internal 

project which comprises a series 

of initiatives intended to strengthen the 

strategic aims and services of 50Hertz. 

Employee representatives are also kept 

abreast of changes in the financial and 

economic situation via the Economic 

Committee.

Internal relations 

in the company 

Alongside industrial relations in official 

staff representative bodies, the Elia 

Group offers many opportunities for employees 

in both Germany and Belgium 

to meet, exchange information and 

engage in dialogue. These are organised 

at company level – e.g. meetings in 

the field between the CEO and employees 

– and within specific divisions (local 

information sessions). Departmental or 

team meetings are also held. 

Specific sessions were organised in 

Belgium in the Asset Management division, 

following organisational changes 

introduced in 2011, and in Germany, in 

connection with the POWER project. 

In addition, there are various communication 

channels providing regular 

information to Group staff (website, enewsletters, 

company magazine, noon 

meetings, etc.). 

In 2011, for the first time, Belgian and 

German employees were given opportunities 

to meet: the sporting challenge 

in Belgium, the sports day in Berlin, the 

climb up the Col du Galibier by German 

and Belgian staff, and the joint meeting 

between Belgian and German management 

teams. 


SOCIAL REPORT 

Alongside industrial relations in official staff 

representative bodies, the Elia Group offers many 

opportunities for employees in both Germany 

and Belgium to meet, exchange information and 

engage in dialogue. 

Relations with customers 

79 

The Customer Relations Department 

and its account managers are the 

bedrock of Elia’s dealings with customers. 

2011 was characterised by the 

specific need for exchanges on new 

2012-2015 tariffs. Despite the uncertainty 

surrounding tariffs until the final 

few days of 2011, Elia endeavoured to 

keep its customers well informed about 

new tariff mechanisms. Accordingly, 

tariff information sessions were held on 

28 December 2011 to ensure a sound 

understanding of 2012-2015 tariffs.

80 


SOCIAL REPORT 

The Users’ Group, set up by Elia as a 

primary channel for exchanges with grid 

users, held a number of meetings to this 

end. With regard to DSOs, a consultation 

was held at CREG and followed by 

various bilateral meetings. Elia also set 

up a process to review the collaboration 

agreement within Synergrid with a view 

to incorporating the new tariff rules into 

the agreement. 

Each year, Elia organises a special 

day for its customers, to keep them 

informed, strengthen dialogue and 

increase the number of exchanges on 

matters that concern them. The 2011 

edition attracted record numbers of 

people. Two discussion panels gave 

rise to some very interesting debates. 

The first, consisting of Noémie Laumont 

(Edora), Marcel Cailliau (FEBEG), Francis 

van Gijseghem (ODE Vlaanderen), André 

Pictoel (VREG President, the Flemish 

regulator) and the head of the Elia Customer 

Relations Department, focused 

on the integration of decentralised 

generation. 

The second, on the development and 

regulation of the European market, 

featured Alberto Pototschnig (Director 

of the Agency for the Cooperation of 

Energy Regulators (ACER)), Dominique 

Woitrin (Technical Director of CREG), 

Anne-Malorie Geron (Head of Markets 

at Eurelectric), Catherine Vandenborre 

(CEO of Belpex) and Daniel Dobbeni 

(President of ENTSO-E). 

Customers receive a monthly e-newsletter 

and can consult detailed and 

transparent information published on 

the Elia website. They can also access 

relevant applications and information via 

the extranet in an efficient, user-friendly 

and secure way. 

Customers’ Day 

Each year, Elia also 

organises a special day 

for its customers, to keep 

them informed, strengthen 

dialogue with them and 

increase the number of 

exchanges on matters 

that concern them.

50,000 

questions are fielded by the 

regional technical secretariats 

each year. 

Relations with the 

authorities, residents and 

the general public 

Elia takes care to inform the relevant administrative 

bodies and authorities and 

the people living near its facilities about 

what it is doing (regardless of whether 

it relates to its investment, maintenance 

or emergency intervention projects) 

and how this may affect their daily lives, 

especially during works carried out by 

subcontractors or maintenance teams. 

Information meetings with the public 

and authorities, a hotline to regional 

technical secretariats in Brussels, 

Merksem and Namur and round-theclock 

website access at www.elia.be 

are just a few of the ways Elia caters 

for individuals and public authorities 

requiring information. A lot of information 

meetings were organised in 2011 as 

part of the public consultation on permit 

procedures for the Stevin project. 

Elia was also heard at a hearing organised 

by the Belgian Federal Parliament’s 

Economy Committee in connection with 

Minister Paul Magnette’s bill amending 

the Act of 29 April 1999 relating to the 

organisation of the electricity market, 

and the Act of 12 April 1965 on the 

transmission of gaseous products. 

The regional technical secretariats field 

around 50,000 questions each year. 


SOCIAL REPORT 

81 

Information meetings with 

the public and authorities, 

a round-the-clock hotline to 

regional technical secretariats 

in Brussels, Merksem 

and Namur and website 

access at www.elia.be are 

just a few of the ways Elia 

caters for individuals and 

public authorities requiring 

information.

04 

Corporate 

governance 

statement 



With a view to meeting certain obligations, Elia is transparent, 

neutral and non-discriminatory towards all stakeholders 

involved in its activities. 

At Elia, corporate governance is based on two pillars: 

• the Corporate Governance Code which Elia adopted 

as a benchmark; 

• the Act of 29 April 1999 on the organisation of the 

electricity market and the Royal Decree of 3 May 1999 

on the management of the electricity transmission system 

applicable to Elia as a transmission system operator. 

83

84 

Composition 

of management bodies 

Board of Directors 1 

CHAIRMAN 

• Luc Van Nevel, whose chairmanship was renewed 

on 10 May 2011, independent 

VICE-CHAIRMEN 

• Francis Vermeiren, whose vice-chairmanship 

was renewed on 10 May 2011, Publi-T 

• Thierry Willemarck, whose vice-chairmanship 

was renewed on 10 May 2011, independent 

DIRECTORS 



• Jennifer Debatisse, whose term of office was renewed 

on 10 May 2011, Publi-T 

• Clement De Meersman, whose term of office 


• Johan De Roo 2 , until 25 August 2011, Publi-T 

• Jacques de Smet, whose term of office was renewed 

on 10 May 2011; independent 

• Claude Grégoire, whose term of office was renewed 


• Philip Heylen 3 , from 25 August 2011, Publi-T 

• Jean-Marie Laurent Josi, whose term of office 


• Miriam Maes 4 , whose term of office was renewed 


• Jane Murphy, whose term of office was renewed 


• Dominique Offergeld, whose term of office was renewed 


• Steve Stevaert , whose term of office was renewed 


• Leen Van den Neste, whose term of office was renewed 


HONORARY CHAIRMAN 

• Ronnie Belmans 6 

e 

l 

i 

Corporate Governance Committee 

• Thierry Willemarck, Chairman 

• Jane Murphy 

• Luc Van Nevel, until 10 May 2011 

• Miriam Maes, from 10 May 2011 

Audit Committee 

• Clement De Meersman, Chairman 

• Jacques de Smet 

• Claude Grégoire 

Remuneration Committee 

a g r 

• Jean-Marie Laurent Josi, Chairman 

• Jacques de Smet 

• Francis Vermeiren 

1 Composition of the Elia System Operator and Elia Asset Boards of Directors as at 31 December 2011. 

As of 13 January 2011, the Boards have 14 members. 

2 On 25 August 2011, the Elia System Operator and Elia Asset Boards of Directors accepted the 

voluntary resignation of Johan De Roo, effective from midnight on 24 August 2011. Philip Heylen was 

co-opted on 25 August 2011 as a non-independent director and replacement for Johan De Roo. He 

was appointed permanently by the Extraordinary General Meeting of Elia System Operator and Elia 

Asset on 26 October 2011. 

3 See reference 4. 

4 Following the expansion of the Boards of Directors to 14 members, on 13 January 2011 Miriam Maes 

was co-opted as an independent director and Steve Stevaert was co-opted as a non-independent 

director. They were appointed permanently by the Ordinary General Meeting of Elia System Operator 

and Elia Asset on 10 May 2011. 

5 idem 

6 This means he is no longer required to attend Board meetings.

o 

Auditors 

u 

• Klynveld Peat Marwick Goerdeler Réviseurs 

d’Entreprises SCRL, represented by Alexis Palm 

• Ernst & Young Réviseurs d’Entreprises SCRL, 

represented by Marnix Van Dooren 

Management Committee 

• Daniel Dobbeni, Chairman and Chief Executive Officer 

• Jacques Vandermeiren, Vice-president and Chief 

Corporate Officer 

• Jan Gesquière, Chief Financial Officer 

• Hubert Lemmens, Chief Innovation Officer 

• Roel Goethals, Chief Officer European Activities & 

Participations 

• Frank Vandenberghe, Chief Officer Energy 

& System Management 

• Markus Berger, Chief Officer Asset Management 

Secretary-General 

• Pierre Bernard until 10 May 2011 

• Gregory Pattou from 10 May 2011 

Board of Directors 

p 

The Boards of Directors of Elia System Operator and Elia Asset 

are the same and, since the amendment to the articles of 

association on 13 January 2011, have consisted of 14 members, 

none of whom perform a management role within either 

of those two companies. Half of the members are independent 

directors in keeping with the conditions laid down in both Article 

526ter of the Companies Code and the articles of association, 

and having received a positive opinion from CREG on their 

independence. 

= 



elia 

+ 

85 

50Hertz 

In accordance with provisions stipulated by legislation and the 

articles of association, these Boards of Directors are supported 

by three committees – a Corporate Governance Committee, an 

Audit Committee and a Remuneration Committee – which are 

the same for Elia System Operator and Elia Asset. The Boards 

ensure the effective operation of these committees. 

APPOINTMENT OF DIRECTORS 

The following changes were made to the Board of Directors 

in 2011: 

• Following the expansion of the Boards of Directors to 14 

members, on 13 January 2011 Miriam Maes was co-opted 

as an independent director and Steve Stevaert was coopted 

as a non-independent director. They were appointed 

permanently by the Ordinary General Meeting of Elia System 

Operator and Elia Asset on 10 May 2011. 

• On 10 May 2011, the terms of office of 14 directors, of whom 

seven were independent and seven were not, were renewed 

by the general meeting of Elia System Operator and 

Elia Asset for a period of six years. CREG issued a positive 

opinion on the appointment of the independent directors. 

• Johan De Roo voluntarily resigned from his post as director. 

His resignation was accepted by the Boards of Elia System 

Operator and Elia Asset on 25 August 2011 with effect from 

midnight on 24 August 2011. 

• The Boards of Elia System Operator and Elia Asset co-opted 

Philip Heylen on 25 August 2011 as a non-independent 

director and replacement for Johan De Roo. He was appointed 

permanently by the Extraordinary General Meeting 

of Elia System Operator and Elia Asset on 26 October 2011. 

The directorships will expire at the end of the 2017 general 

meeting for the financial year ending on 31 December 2016. 

The six-year term diverges from the term of four years recommended 

by the Belgian Corporate Governance Code, a fact 

justified by the technical, financial and legal specificities and 

complexities associated with the tasks of the transmission system 

operator, which call for greater experience in those areas.

86 



It should be remembered that the corporate governance rules 

for the appointment of independent and non-independent 

members of the Elia System Operator and Elia Asset Boards 

and their committees, as well as their roles, are subject to specific 

procedures. The appointment procedures are laid down 

in the Act of 29 April 1999 on the organisation of the electricity 

market and in the company’s articles of association. 

The Act of 29 April 1999 on the organisation of the electricity 

market gave the Corporate Governance Committee the 

important task of putting forward candidates for the role of independent 

director. The directors are appointed based on the 

candidate list drawn up by the Corporate Governance Committee. 

For each candidate, the Committee takes into account 

an up-to-date CV and a signed formal declaration outlining the 

independence criteria as stipulated by legislation applying to 

Elia and the articles of association. Then the general meeting 

appoints the independent directors. These appointments 

are submitted to CREG for its opinion on the independence of 

each independent director. A similar procedure applies where 

an independent directorship becomes vacant during the relevant 

term of office and where the Board co-opts a candidate 

put forward by the Corporate Governance Committee. 

One of the Corporate Governance Committee’s tasks is to 

act as a nomination committee for independent directors. For 

the appointment of non-independent directors, no nomination 

committee has been established to make recommendations 

to the Board. This arrangement, which diverges from the 

Corporate Governance Code, is due to the fact that the Board 

constantly seeks consensus, wherever possible. Moreover, no 

significant decision can be made without a majority among the 

groups of independent directors and non-independent directors 

respectively. 

APPOINTMENT OF COMMITTEE MEMBERS 

The terms of office of the chairmen, vice-chairmen and members 

of the various committees supporting the Board of Directors 

were renewed by the Board of Directors’ meeting of 10 

May 2011, for a period of three years. 

Miriam Maes was appointed as a member of the Corporate 

Governance Committee by the Board of Directors on 10 May 

2011, as a replacement for Luc Van Nevel. 

AUDITORS 

At the ordinary general meetings of Elia System Operator 

and Elia Asset on 10 May 2011, Ernst & Young Réviseurs 

d’Entreprises and Klynveld Peat Marwick Goerdeler Réviseurs 

d’Entreprises were reappointed as auditors, represented by 

Marnix Van Dooren and Alexis Palm respectively. 

The auditors were reappointed for a period of three years. Their 

terms of office are due to expire following the 2014 ordinary 

general meeting for the financial year ending on 31 December 

2013. 

The annual auditors’ fees for auditing the simplified and consolidated 

annual accounts of Elia System Operator, and the 

simplified and consolidated annual accounts of Elia Asset and 

Elia Engineering were set at €150,000 (€90,000 for Elia System 

Operator, €50,000 for Elia Asset and €10,000 for Elia Engineering), 

to be indexed annually based on the cost-of-living index. 

BOARD OF DIRECTORS’ ACTIVITY REPORT 

Under the Act of 29 April 1999, the Board of Directors: 

• defines the company’s general policy, values and strategy 

– by transposing those values and strategy into primary 

guidelines, the Board takes into account corporate social 

responsibility and diversity, both in terms of gender and 

generally; 

• exercises the powers bestowed on it by the Belgian Companies 

Code and by the Act of 29 April 1999 on the organisation 

of the electricity market, with the exception of 

powers delegated to the Management Committee; 

• takes any action deemed helpful or necessary to achieve 

the object of the company, with the exception of those actions 

falling within the scope of the powers attributed or 

delegated exclusively to the Management Committee, and 

the powers reserved for the general meeting by law or the 

articles of association; 

• exercises the powers bestowed on it by the articles of association; 

• exercises general control, for example over the Management 

Committee in accordance with statutory restrictions 

regarding access to commercial data and other confidential 

information relating to grid users and its processing; 

• monitors and evaluates the effectiveness of the committees 

supporting the Board. 

In 2011, the Boards of Directors of Elia System Operator and 

Elia Asset met on ten and eight occasions respectively. The 

following members were absent at one or more Board meetings: 

Claude Grégoire (13 January 2011), Steve Stevaert and 

Thierry Willemarck (24 March 2011), Johan De Roo (10 May 

2011), Jean-Marie Laurent Josi, Leen Van den Neste and Francis 

Vermeiren (23 June 2011), Clement De Meersman, Philip 

Heylen and Miriam Maes (11 October 2011), and Jennifer Debatisse, 

Clement De Meersman, Jean-Marie Laurent Josi, Miriam 

Maes, Jane Murphy, Leen Van den Neste, Francis Vermeiren 

and Thierry Willemarck (23 December 2011). 

Members who are unable to attend usually have a representative. 

Under Article 19.4 of the Elia System Operator articles of 

association and Article 18.4 of the Elia Asset articles of association, 

members who are absent or prevented from attending 

may give their prior written permission authorising another 

member of the Board to represent and vote on their behalf. No 

member can represent more than two directors.

Significant events in 2011 

Changes to the articles of association 

The articles of association of Elia System Operator and Elia Asset 

were amended in 2011 with a view to expanding the Board 

to 14 members, and in line with the new Act of 20 December 

2010 on the exercise of certain rights of shareholders. 

The amendments to the articles of association must comply 

with the rules laid down in this regard in the Belgian Companies 

Code and by the company’s articles of association (in particular 

Articles 28 and 29 of the articles of association of Elia System 

Operator and Articles 27 and 28 of the articles of association 

of Elia Asset). 

The full latest version of the articles of association can be found 

on the company’s website. 

Extension of the Board of Directors 

to 14 members 

The Boards of Elia System Operator and Elia Asset were extended 

from 12 to 14 members by the extraordinary general 

meeting of 13 January 2011. The Boards comprise seven independent 

and seven non-independent directors. 

This extension reflects the growth in the supervisory role performed 

by the Board of Directors of Elia System Operator in the 

wake of international developments, in particular the acquisition 

of 50Hertz Transmission and non-regulated activities. 

Since the Boards of Elia Asset and Elia System Operator must 

comprise the same members under Article 9bis(§3) of the Act 

of 29 April 1999 on the organisation of the electricity market, 

both Boards were expanded to include 14 members. 

As a result, the articles of association were amended as follows: 

• The first sentence of Article 12.1 of the articles of association 

was amended in light of the expansion of the Board of 

Directors from 12 to 14 members. 

• A new Article (12.4) was added to the articles of association 

to enable the Board of Directors to validly deliberate and 

decide whether, in the event of one or more directorships 

being vacant, the Board of Directors should temporarily 

comprise fewer than 14 members. 

• Article 13.5.2 of the articles of association was amended so 

as to modify the application rights of A and C shareholders 

in light of the expansion of the Board of Directors from 12 

to 14 members. 

Following the extension, two new directors were appointed: 

one independent and the other non-independent. 



New Act of 20 December 2010 on the 

exercise of certain rights of shareholders 

87 

The new Act of 20 December 2010 on the exercise of certain 

rights of shareholders (rerferred to below as the Act on Shareholders’ 

Rights), which entered into force on 1 January 2012, 

increased the rights of shareholders through its amendments 

to the Companies Code. Elia System Operator and Elia Asset 

amended their articles of association on 26 October 2011 to 

bring them into line with the new provisions by 1 January 2012. 

The following amendments were made to the articles of association 

of Elia System Operator: 

• Article 24.1 of the articles of association was amended in 

the wake of the new rule regarding the right to question 

shareholders. The company must receive questions in writing 

by no later than the sixth (6th) day preceding the general 

meeting. 


the wake of the new rule regarding participation by proxy in 

general meetings. 


the wake of the new rule regarding the right to include topics 

in the agenda of the general meeting. 

• Article 26.2 of the articles of association was amended following 

the extension of the number of days by which the 

Board could defer the general meeting. 

• Article 27 of the articles of association was amended in the 

wake of the new rule regarding the right to participate in 

general meetings and, where applicable, exercise the right 

to vote at meetings. 


the wake of the new rule regarding votes by mail at general 

meetings. 

• Article 30 of the articles of association was amended in the 

wake of the new rule regarding the publication of general 

meeting minutes. 

• Article 31 of the articles of association was amended in 

the wake of the new rule regarding the period within which 

the Board of Directors is expected to submit the necessary 

documents to auditors.

88 



Eurogrid International, a 60% subsidiary of Elia, 

acquired a 10% stake in the initial phase of the Atlantic 

Wind Connection project for the establishment of the 

first offshore high-voltage direct-current grid along the 

East coast of the United States. Elia is cooperating 

with Google, Marubeni, Good Energies and Atlantic 

Grid Development on this project. Specifically, the 

project will help to develop Group expertise for 

similar prospective projects in Europe, such as 

offshore grids and power highways of the future. 

Renewal of the terms of office of Board 

members, Board committee members 

and the Chairman and Vice-Chairmen; 

appointment of a new Secretary General 

Following the expiry of their terms of office, the seven independent 

directors and seven non-independent directors were 

reappointed for a six-year period by the Elia System Operator 

and Elia Asset general meeting of 10 May 2011. The new directorships 

will expire following the 2017 general meeting for the 

financial year ending 31 December 2016. 

At the time of their reappointment, the directors satisfied all 

conditions of independence as laid down in Article 526ter of 

the Companies Code. Thierry Willemarck, Clement De Meersman, 

Jean-Marie Laurent Josi and Luc Van Nevel said they 

would resign if the total duration of their terms of office reached 

12 years, as provided for in Article 526ter(§2). 

On 10 May 2011, the chairmanship of Luc Van Nevel and vicechairmanships 

of Francis Vermeiren and Thierry Willemarck 

were renewed for a period of three years or less if required by 

the aforementioned legal provisions (see above). 

The terms of office of the members of the various committees 

supporting the Board were also renewed for a three-year period 

on 10 May 2011 (see above). 

Reappointment of auditors 

Ernst & Young Réviseurs d’Entreprises and Klynveld Peat Marwick 

Goerdeler Réviseurs d’Entreprises, represented respectively 

by Marnix Van Dooren and Alexis Palm, were reappointed 

as auditors for a period of three years (see above). 

Appointment of a new Secretary General 

Gregory Pattou was appointed Secretary General of Elia System 

Operator and Elia Asset, replacing Pierre Bernard, who 

resigned. 

Stakeholding in Atlantic Wind Connection 

Eurogrid International, a 60% subsidiary of Elia, acquired a 

10% stake in the initial phase of the Atlantic Wind Connection 

project for the establishment of the first offshore high-voltage 

direct-current grid along the East coast of the United States. 

Elia is cooperating with Google, Marubeni, Good Energies and 

Atlantic Grid Development on this project. Elia also concluded 

a long-term consultancy contract with the project developer. 

Specifically, the project will help to develop Group expertise for 

similar prospective projects in Europe, such as offshore grids 

and power highways of the future.

Reacquisition by the company 

of its own shares 

The permission granted to the Elia System Operator Board 

of Directors for the reacquisition by the company of its own 

shares in the event of a serious threat, as defined in Article 37 

of the articles of association, was renewed for a period of three 

years with effect from the date of publication of the decision 

taken by the extraordinary general meeting of 26 October 2011. 

New head of the Management Committee 

Jacques Vandermeiren was appointed as the future CEO and 

Chairman of the Elia Management Committee at the Board 

meeting of 24 November, following the proposal of the Corporate 

Governance Committee. He will succeed Daniel Dobbeni 

in the second half of 2012. In the year to come, Elia will continue 

to benefit from the expertise of Daniel Dobbeni amongst other 

things for the follow-up and consultancy regarding European 

and international energy markets and mandates within bodies 

of subsidiaries and sector associations. 

2012-2015 tariff proposal 

The Commission for Electricity and Gas Regulation (CREG) 

approved the proposal made by Elia in keeping with the regulator’s 

rules regarding tariffs for electricity transmission from 

2012 up to and including 2015. 

The tariffs were calculated following a consultation between 

the regulator and Elia with a view to providing market players 

with appropriate tariff indicators, for both power injection and 

offtake, and to meeting the needs of the company to enable 

it to perform its duties. The new tariffs also take into account 

changes in the energy climate during the first tariff period from 

2008 to 2011, against a backdrop of economic uncertainty and 

in the absence of the third package of European directives. 

Incentive mechanisms were put in place for consumers and 

the company so as to promote effective management while 

maintaining the excellent level of grid reliability seen in Belgium 

for a number of years. 

Removal of the capital increase reserved 

for personnel 

Owing to turbulence on the financial markets on the one hand 

and the failure to transpose into Belgian law the third package 

of European directives on the other, the Board of Directors 

– following the advice of the Management Committee – decided 

to remove the capital increase reserved for personnel (on 

which it intended to vote) from the agenda of the Extraordinary 

General Meeting of 26 October. 

Remuneration Committee 

In addition to its usual support role to the Board of Directors and 

in accordance with both Article 526quater of the Companies 

Code and the Act of 29 April 1999 on the organisation of the 

electricity market, the Remuneration Committee is required 

to make recommendations to the Board of Directors with 

regard to remuneration policy and the individual remuneration 

of Management Committee members and directors. The 

Remuneration Committee also draws up a remuneration report 

for presentation at the ordinary general meeting. 

The Remuneration Committee met on 12 occasions particularly 

regarding the succession process of the Chairman of the 

Management Commitee by 2012. 

The company evaluates its supervisory staff on a yearly basis 

in accordance with its performance management policy. This 

policy also applies to members of the Management Committee. 

Accordingly, the Remuneration Committee evaluates the 

members of the Management Committee on the basis of a 

series of quantitative and qualitative collective and individual 

targets. As noted elsewhere, remuneration policy for the variable 

portion of the Management Committee’s remuneration 

was adapted to take account of the implementation of multiyear 

tariffs. Consequently, since 2008 the salary scheme for 

members of the Management Committee has included, among 

other things, an annual variable remuneration and a long-term 

incentive staggered over the multi-year regulation period. The 

variable remuneration has two parts: the attainment of quantitative 

collective targets, and individual performance, including 

progress on business projects. 

As part of the process aimed at ensuring continuity within the 

Management Committee, the Remuneration Committee also 

made recommendations to the Corporate Governance Committee 

regarding the succession of the Chairman of the Management 

Committee. In addition, the Remuneration Committee 

drafted a proposal in connection with the capital increase 

reserved for personnel scheduled for 2011 and 2012 (see ‘Significant 

events’ for more on these two points). 

Audit Committee 



89 

In addition to its usual support role to the Board of Directors 

and in accordance with both Article 526bis of the Companies 

Code and the Act of 29 April 1999 on the organisation of the 

electricity market, the Audit Committee is responsible for: 

• examining accounts and controlling budgets; 

• monitoring financial reporting procedures; 

• ensuring the effectiveness of internal control and risk 

management systems; 

• monitoring internal audits and their effectiveness; 

• following up on the statutory audit of annual accounts; 

• evaluating and ensuring the independence of auditors; 

• making proposals to the Board of Directors as to the (re)

90 



appointment of auditors and the conditions of such (re) 

appointments; 

• investigating any issues surrounding the resignation of 

auditors and making proposals as to what actions, if any, 

should be taken in this respect; 

• verifying the nature and extent of non-audit services provided 

by auditors; 

• ensuring the effectiveness of external audit procedures. 

Pursuant to Article 96(§1)9° of the Belgian Companies Code, 

this report must justify the independence and accounting 

and auditing competence of at least one member of the Audit 

Committee. The obligation for at least one member of the Audit 

Committee to have the necessary accounting and auditing 

competencies is also laid down in the articles of association. 

Clement De Meersman, the Chairman of the Audit Committee, 

is an independent director and has extensive experience 

and competence in accounting and auditing. He holds a degree 

in electromechanical engineering and a PhD in applied 

sciences, both from KULeuven. He has completed executive 

training courses at IMD in Switzerland and the Vlerick Management 

School. He was a visiting student researcher at MIT 

(USA) and the Institute of Technology in Tokyo. He began his 

working life at KULeuven as an assistant professor before pursuing 

a career outside academia at a company affiliated to the 

Michelin Group, active in the development, manufacture and 

sale of high-resistance tyres. In 1986, he left this job to join 

the Dutch DSM Group as a business unit director in charge 

of the development and sale of plastic materials, composites 

and high-performance products for the transport and automotive 

industry. In early 1994, he became the CEO of Deceuninck 

NV/SA, a position he held until 2009. Clement De Meersman 

is also a board member at Deceuninck, Koramic Industries, 

ANL, Plasticvision, VKC and Smartroof. He is a member of the 

advisory board at Verhelst and ING Kortrijk, and used to sit on 

the board of Roularta. 

The Audit Committee may investigate any matter that falls 

within its remit. It is given the resources it needs to perform this 

task, has access to all information (with the exception of commercial 

data concerning grid users) and can call on internal and 

external experts for advice. 

The Audit Committee met on six occasions in 2011. 

The Committee examined the annual accounts for 2010, drawn 

up in accordance with both Belgian GAAP and IFRS. It then analysed 

the quarterly results as at 31 March 2011, the half-yearly 

results as at 30 June 2011 and the figures for the first three 

quarters as at 30 September 2011, drawn up in accordance 

with Belgian GAAP and IFRS. The Committee took note of the 

audits and recommendations made. The further expansion of 

risk management within the company was also approved by 

the Committee. An action plan was drawn up for each of the 

audits so as to improve the quality of procedures and of the 

checks carried out and thereby reduce the associated risks. 

The Committee monitored these action plans from a number of 

perspectives (timetable, results, priorities) on the basis, among 

other things, of an activity report from the internal audit department. 

The Committee concluded that these action plans were 

being carried out properly and within the agreed time-frames. 

The 2012 audit plan was submitted to and approved by the 

Committee. 

Corporate Governance Committee 

In addition to its usual support role to the Board of Directors 

and in accordance with both the Act of 29 April 1999 on the 

operation of the electricity market and the articles of association, 

the Corporate Governance Committee is responsible for: 

• putting forward candidates to the general meeting to be 

appointed as independent directors; 

• giving prior approval for the appointment and/or resignation 

(where applicable) of Management Committee members; 

• examining – at the request of any independent director, 

the Chairman of the Management Committee, CREG or 

any other federal or regional regulatory body – all cases of 

conflicts of interests between the system operator on the 

one hand and a dominant shareholder, municipal shareholder 

or company associated with or linked to a dominant 

shareholder on the other, with a view to reporting to the 

Board of Directors (this task aims to strengthen the directors’ 

independence above and beyond the procedure detailed 

in Article 524 of the Belgian Companies Code, which 

the company also applies); 

• providing its opinion in cases of incompatibility on the part 

of members of the Management Committee and personnel; 

• ensuring the application of provisions laid down by law, regulations, 

decrees and other acts relating to the organisation 

of the electricity market, evaluating their effectiveness 

in view of the objectives for the independent and impartial 

operation of the transmission system, and reporting annually 

on this matter to the Board of Directors and regulatory 

bodies; 

• holding – at the request of at least one third of members – 

Board meetings in accordance with the formalities for calling 

meetings as laid down in the articles of association. 

The Committee met on three occasions in 2011. As far as confidentiality 

rules permit, the Committee is kept regularly informed 

of issues of importance, such as the purchase of ancillary services 

and the content of the infrastructure project portfolio, so 

as to ensure the liberalisation of the electricity market.

From left to right: Frank Vandenberghe, Hubert Lemmens, 

Markus Berger, Daniel Dobbeni, Jan Gesquière, Roel 

Goethals, and Jacques Vandermeiren. 

Management Committee 

The Management Committee was established on 29 July 

2003, pursuant to Article 9 of the Act of 29 April 1999 on the 

organisation of the electricity market. It is responsible for transmission 

system operation and the day-to-day management of 

the system operator, as well as for exercising the other powers 

delegated to it by the Board of Directors and the powers assigned 

to it by the articles of association. 

The Management Committee usually meets formally at least 

once a month. Members also attend informal weekly meetings. 

Members who are unable to attend usually have a representative. 

In accordance with the Committee’s internal rules of procedure, 

an absent member may authorise another member to 

represent him or her by giving prior written permission. Nobody 

must represent more than two members. 

In 2011, the Management Committee met on 13 occasions for 

Elia System Operator and 11 occasions for Elia Asset. 

Each quarter, the Management Committee reports to the Board 

of Directors on the company’s financial situation (in particular 

on the balance between the budget and the results stated). It 

also reports on transmission system operation at each Board 

meeting. As part of its responsibilities to report on operation of 

the transmission system in 2011, the Committee kept the Board 

informed of changes in legislation and case law which applied 

to the company, especially developments in the transposal of 

the third package of European directives, important decisions 

by regulators and administrations, grid management, the situation 

facing subsidiaries, the acquisition of shares by Eurogrid 

International in the AWC project to develop an offshore grid 

along the East coast of the United States, the development of 

international projects and the 2012-2015 tariff proposal. 



91 

CODE OF CONDUCT 

Elia has a Code of Conduct to prevent staff and those with 

leadership responsibilities in the Group from breaking any laws 

on the use of privileged information and market manipulation 

during transactions associated with Elia activities. The Code of 

Conduct lays down a series of regulations and communication 

obligations for stock exchange transactions by those individuals, 

in accordance with the provisions of Directive 2003/6/EC 

on insider trading and market manipulation and the Act of 2 

August 2002 on monitoring of the financial sector and other 

financial services. 

CORPORATE GOVERNANCE CHARTER AND COMMITTEES’ 

INTERNAL RULES OF PROCEDURE 

The Corporate Governance Charter and the internal rules of 

procedure of the Board of Directors, Management Committee, 

Audit Committee, Remuneration Committee and Corporate 

Governance Committee were amended by the Board of Directors 

on 25 May 2010. The Corporate Governance Charter can 

be found on the company’s website (www.elia.be). 

TRANSPARENCY RULES – NOTIFICATIONS 

In accordance with the Act of 2 May 2007, the Royal Decree 

of 14 February 2008 on the disclosure of major shareholdings 

authorised on the regulated market, and various provisions of 

the Royal Decree of 14 February 2008, Elia was informed of the 

declaration of transparency by the Arco Group (Arcofin, Arcopar, 

Arcoplus, Auxipar, Arcosyn and Interfinance) and Publi-T 

on 30 March 2011. 

The full text of this declaration of transparency can be found 

on www.elia.be.

92 



Remuneration of the Board 

of Directors and Management 

Committee 

Procedure applied in 2011 with a view 

to devising the remuneration policy and 

remunerating directors and Management 

Committee members 

Pursuant to Article 16.1 of the Elia System Operator articles 

of association and Article 15.1 of the Elia Asset articles of association, 

the Remuneration Committee drew up a draft policy 

for the remuneration of directors and Management Committee 

members and submitted it to the Board of Directors. 

The Remuneration Committee also made various recommendations 

regarding the remuneration of directors and Management 

Committee members. 

The composition and activities of the Remuneration Committee 

are covered in greater detail on page 89 of the annual report. 

Remuneration of directors 

Total remuneration paid to the 14 Elia directors in 2011 was 

€551,875.34 (€281,275.17 for Elia System Operator and 

€270,600.17 for Elia Asset). The table below lists the individual 

gross sums paid to each director for Elia System Operator and 

Elia Asset combined: 

Luc Van Nevel 46.674 € 1 

Francis Vermeiren 48.966 € 

Thierry Willemarck 40.403 € 

Jennifer Debatisse 30.634 € 2 

Clement De Meersman 40.280 € 

Johan De Roo 19.664 € 3 

Jacques de Smet 56.192 € 

Claude Grégoire 40.762 € 4 

Philip Heylen 15.076 € 5 

Jean-Marie Laurent Josi 46.064 € 

Miriam Maes 37.388 € 6 

Jane Murphy 37.870 € 

Dominique Offergeld 31.116 € 

Steve Stevaert 30.634 € 7 

Leen Van den Neste 30.152 € 8 

These figures were calculated on the basis of ten meetings of 

the Board of Elia System Operator and eight meetings of the 

Board of Elia Asset in 2011. The Audit Committee met on six 

occasions, the Corporate Governance Committee on three 

occasions and the Remuneration Committee on twelve occasions. 

Directors’ remuneration consists of a basic remuneration of 

€25,000 per annum (€12,500 for Elia System Operator and 

€12,500 for Elia Asset) plus an additional €800 (€400 for Elia 

System Operator and €400 for Elia Asset) for each meeting 

after the eighth Board meeting of the year, including meetings 

with regulators. The remuneration is 50% more for the Chairman 

and 20% more for each Vice-Chairman of the Board of 

Directors. 

An additional fixed remuneration of €6,000 per year per committee 

(€3,000 for Elia System Operator and €3,000 for Elia 

Asset) is awarded to directors who sit on a support committee, 

with an additional remuneration of €800 (€400 for Elia System 

Operator and €400 for Elia Asset) for each additional committee 

meeting (i.e. each meeting after the three covered by the 

basic remuneration), including meetings with regulators. 

This remuneration is included in the company’s operating costs 

and is indexed annually in accordance with the consumer price 

index. All remunerations are paid on a pro-rata basis during the 

director’s term of office. 

Directors receive an advance on their annual remuneration at 

the end of the first, second and third quarters. The advance is 

calculated on the basis of the basic indexed fee and on a prorata 

basis in relation to the duration of the directorship during 

the quarter in question. A detailed account is prepared during 

the month of December for the financial year. This account 

takes into consideration any additional remuneration on top of 

the basic remuneration. 

Directors do not receive any other benefits in kind, stock options, 

special loans or advances. Neither Elia System Operator 

nor Elia Asset has issued credit to or on behalf of any Board 

member. 

1 Luc Van Nevel is no longer a member of the Corporate Governance Committee, as of 10 May 2011. 

2 Jennifer Debatisse’s fees are paid to the company Interfin. 

3 Johan De Roo is no longer a member of the Board of Directors, as of 25 August 2011. 

4 Claude Grégoire’s fees are paid to the company Socofe. 

5 Philip Heylen became a Board member on 25 August 2011. 

6 Miriam Maes became a Board member on 13 January 2011 and a member of the Corporate Governance 

Committee on 10 May 2011. 

7 Steve Stevaert became a Board member on 13 January 2011. 

8 Leen Van den Neste’s fees are paid to the company Arcopar (with the exception of the €7,538 paid in Q1).

Remuneration policy 

The Remuneration Committee evaluates the members of the 

Management Committee once a year. The change in the basic 

remuneration is linked to the position of each member of the 

Management Committee with respect to a benchmark salary 

in the general marketplace and the assessment of his individual 

performance. 

Since 2004, the HayGroup methodology has been used to 

weight each management position and ensure that remuneration 

is in line with the going market rate. 

Management Committee members’ remuneration consists of 

the following components: 

• basic salary; 

• short-term variable remuneration; 

• long-term variable remuneration; 

• pension and other benefits. 

Basic remuneration 

In view of the many changes that have taken place since the 

positions were last weighted, such as the company’s listing 

on the stock exchange in 2005, the acquisition of 50Hertz 

Transmission, the diversification and internationalisation of the 

company’s activities as well as internal operational structural 

changes, five Management Committee positions, including 

that of Chairman of the Management Committee, were reevaluated 

following the Hay Study. The Remuneration Committee 

decided to apply the new benchmark salary as of January 

2011. 

Given general market conditions in late 2011, it was decided 

– based on the proposal of the Chairman of the Management 

Committee – not to increase the recurring remuneration of 

Management Committee members on 1 January 2012 beyond 

inflation. 

All the members of Elia’s Management Committee have employee 

status. 

In 2011, the basic remuneration for the Chairman of the Management 

Committee totalled €384,831.27. The recurring remuneration 

paid to the other members of the Management Committee 

totalled €1,492,153.77 (€1,007,044.50 for Elia System 

Operator management and €485,109.27 for Elia Asset management). 

Therefore a total basic remuneration of €1,876,985.04 

was paid to members of the Management Committee in 2011. 

Variable remuneration 

The Remuneration Committee evaluates Management Committee 

members at the end of each year based on several 

qualitative and quantitative targets. Since 2008, the variable 

portion of the remuneration has comprised two components. 

The first is based on the attainment of a number of targets set 

by the Remuneration Committee at the start of the year, with a 

maximum of 25% of variable remuneration for the individual targets 

and 75% for the attainment of the Elia Group’s collective 

targets (‘short-term incentive plan’). The second is based on 

multiannual criteria covering a period of four years (‘long-term 

incentive plan’). 

SHORT-TERM VARIABLE REMUNERATION 

In 2011, short-term variable remuneration paid to the Chairman 

of the Management Committee stood at €178,434.98. Variable 

remuneration paid to other members of the Management 

Committee totalled €490,951.12 (€309,788.93 for Elia System 


Therefore, a total of €669,386.10 of variable remuneration 

was paid to Management Committee members in 2011. 

LONG-TERM VARIABLE REMUNERATION 

In 2011, no payments were made under the plan relating to 

the second pillar. Performance for the 2008-2011 period will 

be evaluated in early 2012 under the long-term incentive plan. 

No other variable remuneration was paid in 2011. 

CONTRIBUTIONS TO THE CORPORATE PENSION SCHEME 

Since 2007, all pension plans for Management Committee 

members have been ‘defined contribution’ plans, meaning that 

the amount paid, excluding tax, is calculated on the basis of 

annual remuneration. In 2011, Elia System Operator paid a total 

of €102,095.62 to the Chairman of the Management Committee. 

For the other members of the Management Committee, 

Elia paid a total of €342,901.05 (€231,374.91 for Elia System 


Other benefits 



93 

Other benefits awarded to members of the Management Committee, 

such as guaranteed income in the event of long-term 

illness or an accident, healthcare and hospitalisation insurance, 

invalidity insurance, life insurance, other allowances, assistance 

with public transport costs, provision of a company 

car, employer-borne costs and other small benefits are in line 

with the regulations applying to all company managerial/supervisory 

staff members.

94 



MANAGEMENT COMMITTEE MEMBERS HOLD THE FOLLOWING ELIA SYSTEM OPERATOR SHARES: 

Management Committee member 

The cost of other benefits in 2011 was valued at €35,225.73 for 

the Chairman and €258,571.59 for the other members of the 

Management Committee (€165,076.10 for Elia System Operator 

management and €93,495.49 for Elia Asset management). 

There were no Elia stock options for the Management Committee 

in 2011. 

Total remuneration for 2011 

In 2011, total remuneration for the Chairman of the Management 

Committee stood at €700,587.60, of which 25% was variable. 

Total remuneration paid to other members of the Management 

Committee stood at €2,584,577.54 (€1,713,284.45 for 

Elia System Operator management and €871,293.09 for Elia 

Asset management), of which 19% was variable. Therefore, in 

2011, total remuneration for all Management Committee members 

stood at €3,285,165.13. 

PROVISIONS OF MANAGEMENT COMMITTEE 

EMPLOYMENT CONTRACTS AND SEVERANCE BENEFITS 

The employment contracts concluded with members of the 

Management Committee, including the Chairman, when they 

were hired did not contain any specific terms as regards notice 

of dismissal. 

Number of Elia System 

Operator shares 

Daniel Dobbeni Chief Executive Officer – Chairman of the Management Committee 8,822 

Jacques Vandermeiren Chief Corporate Officer – Vice-Chairman of the Management Committee 1,841 

Markus Berger Director Asset Management 5,790 

Jan Gesquière Chief Financial Officer 4,670 

Roel Goethals Director European Activities & Participations 3,024 

Hubert Lemmens Chief Innovation Officer 4,655 

Frank Vandenberghe Director Energy & System Management 2,682 

Shares held by members of the 

Management Committee and directors 

Information to be communicated under Article 96 of the Belgian 

Companies Code and article 34 of the Royal Decree of 14 

November 2007 on the obligations of issuers of financial instruments 

admitted to trading on a regulated market 

This section contains the information required to be disclosed 

under the aforementioned legislation and not included in other 

parts of the annual report. 

Pursuant to Article 4.3 of the articles of association, all Elia System 

Operator and Elia Asset shares have the same rights, regardless 

of the class to which they belong, except as otherwise 

stated in the articles of association. 

In this context, the articles of association state that specific 

rights are associated with class A and class C shares regarding 

(a) the appointment of Management Committee members 

(Article 13.5.2 of the articles of association of Elia System Operator 

and Article 12.5.2 of the articles of association of Elia 

Asset) and (b) the approval of decisions by the general meeting 

(Articles 28.2.1 and 28.2.2 of the articles of association of Elia 

System Operator and Article 27.2 of the articles of association 

of Elia Asset).

SHAREHOLDER STRUCTURE AT THE BALANCE SHEET DATE 

Shareholder structure at the balance 

sheet date 

On 31 December 2011, the shareholder structure of Elia System 

Operator NV/SA was as indicated above. 

Process of drafting financial information 

and communications 

Elia has taken all possible and appropriate measures to reasonably 

assure that the financial information communicated 

both within and outside the company takes into account the 

risks facing the companies of the group and respect the true 

and fair view principle, in accordance with the applicable legal 

and regulatory framework. 

The budget process is a key component of the internal control 

mechanism that was established to assess and verify accounting, 

financial and economic information and also to determine 

its regulated tariff. For Elia, it is crucial to be able to draw up reliable 

budgets in view of the many elements of uncertainty such 

as wind forecasts and volumes of offtakes from the grids. The 

process of drawing up budgets involves identifying the roles 

and responsibilities of the departments involved so as to provide 

the best possible forecasts on the basis of the information 

that is available. These budgets are checked by line management 

and then by the internal monitoring body and ultimately 

approved by the responsible management bodies. 



Shares % Shares % Voting rights 

Publi-T 27,383,507 45.37 45.37 

Publipart 1,526,756 2.53 2.53 

Group Arco 5,306,880 8.79 8.79 

Other free float 26,138,074 43.31 43.31 

Total 60,355,217 100.00 100.00 

95 

The regulators play a monitoring role, approving the proposed 

multi-year tariff. Budget monitoring is a collective objective for 

the whole of the Elia Group and is carried out on an ongoing 

basis by budget managers and Controlling using, for example, 

frequently tested tools. The monthly, quarterly and annual reporting 

process is based on procedures relating to the budgeted 

items and real items. The accounts and consolidated 

assessment are drafted on the basis of the Group’s accounting 

manual which is regularly updated to take into account internal 

and external factors. This reporting follows a schedule and 

checklists that have been drawn up in advance in consultation 

with various departments that are involved. The outcome of 

this process is frequently verified by the Controlling Department 

and the Internal Audit Department. 

The Accounting Department drafts the financial information 

under the responsibility of the Accounting & Finance Manager, 

based on the reporting process described above. The Group 

results are discussed on a monthly basis by the Accounting 

and Controlling Department, which makes analyses of and 

comparisons between the budget, economic and historical 

information. The final result is submitted to the Executive Committee 

for approval and the quarterly and annual results are 

systematically submitted to the Audit Committee and the Board 

of Directors for approval. The actions of the staff and managers 

of the Accounting and Controlling Department are guided by 

the principles described in the ‘Social report’ chapter.

96 



Features of the internal control 

and risk management systems 

The reference framework for internal control and risk management, 

established by the Management Committee and approved 

by the Elia Board of Directors, is based on the COSO 

II framework developed by the Committee of Sponsoring Organisations 

of the Treadway Commission. The framework has 

five closely linked basic components, providing an integrated 

procedure for internal control and risk management systems: 

control environment, risk assessment, control activities, information 

and communication, and monitoring. 

The use and inclusion of these concepts in Elia’s various procedures 

and activities enables the company to control its activities, 

improve the effectiveness of its operations, optimally 

deploy its resources, and ultimately achieve its objectives. The 

implementation of COSO II at Elia is described below. 

1. Control environment 

ORGANISATION OF INTERNAL CONTROL 

Pursuant to the Elia articles of association, the Board of Directors 

has established various committees to help it fulfil its 

duties: the Management Committee, the Audit Committee, 

the Remuneration Committee and the Corporate Governance 

Committee. The Elia Board of Directors is responsible for evaluating 

the effectiveness of the internal control and risk management 

systems. 

The Board has charged the Audit Committee with the task of 

monitoring: (i) the financial reporting procedure; (ii) the effectiveness 

of internal control and corporate risk management 

systems; (iii) the internal audit and its effectiveness; (iv) the 

statutory audit of annual and consolidated accounts, including 

the follow-up of any issues raised or recommendations made 

by external auditors; (v) the independence of external auditors. 

The Audit Committee meets quarterly to discuss the above 

points. 

The Finance Department helps the Management Committee to 

provide, in a timely manner, correct and reliable financial information 

to aid not only decision-making with a view to monitoring 

the profitability of activities, but also effective management 

of corporate financial services. External financial reporting – 

one of Elia’s duties – includes (i) statutory financial and tax reporting; 

(ii) consolidated financial reporting; (iii) specific reporting 

obligations applicable to public companies; (iv) reporting 

obligations under the regulatory framework. 

Financial reporting is organised in such a way as to meet all 

reporting obligations while ensuring consistency between various 

reports and avoiding inefficiencies. 

The structured approach developed by Elia helps to ensure 

that financial data is both exhaustive and precise, taking into 

account the deadlines for activity reviews and the actions of 

key players so as to ensure adequate control and accounting. 

INTEGRITY AND ETHICS 

Elia’s integrity and ethics are a crucial aspect of its internal 

control environment. The Management Committee and management 

regularly discuss these principles, on which the corporate 

rules established to clarify the mutual rights and obligations 

of the company and its employees are based. These rules 

are disseminated to all new employees, and compliance with 

them is formally included in employment contracts. The Code 

of Conduct also helps to prevent employees from breaking any 

Belgian legislation on the use of privileged information or market 

manipulation and suspicious activities. 

Management consistently ensures that employees comply with 

internal values and procedures and – where applicable – take 

any actions deemed necessary, as laid down in the company 

regulations and employment contracts. A particular focus 

is laid on compliance with confidentiality rules, primarily by 

means of a specific confidentiality clause in employment contracts, 

but also through various measures applied in the event 

of noncompliance. 

By virtue of its legal status as a power transmission system 

operator, Elia abides by a large number of statutory and regulatory 

rules setting out various fundamental principles such 

as confidentiality, transparency and non-discrimination. With 

a view to meeting these specific obligations, Elia has drawn 

up an Engagement Programme (approved by the Corporate 

Governance Committee) and produced a roadmap identifying 

which control initiatives should be taken, and in which order. 

The Compliance Officer reports annually to the relevant regulatory 

bodies in this regard.

ROLES AND RESPONSIBILITIES 

Elia’s internal control system relies on clearly defined roles and 

responsibilities at all levels of the organisation. The roles and 

responsibilities of the various committees* established within 

Elia are primarily identified in the legal framework applicable to 

Elia, the articles of association and the Corporate Governance 

Charter. 

Under the supervision of the Chief Financial Officer, the Accounting 

Department is responsible for statutory financial and 

tax reporting and the consolidation of the Elia Group’s various 

subsidiaries. The Controlling Department monitors analytical 

accounting and reporting and assumes responsibility for all reporting 

in a regulatory context. The Investor Relations Department 

is responsible for specific reporting applicable to companies 

listed on the stock exchange. 

As regards the financial reporting process, the tasks and responsibilities 

of all employees in the Accounting Department 

have been clearly defined with a view to producing financial 

results that accurately and honestly reflect Elia’s financial transactions. 

A detailed framework of tasks and responsibilities has 

been drawn up to identify the main control duties and the frequency 

with which tasks and control duties are performed. 

An IFRS Accounting Manual is used by all entities within the 

scope of consolidation as a reference for accounting principles 

and procedures, thus ensuring consistency, comparability and 

accurate accounting and reporting within the Group. The Finance 

Department has the appropriate means (including IT 

tools) to perform its tasks; all entities within the scope of consolidation 

use the same ERP software, which has a range of integrated 

controls and supports task separation as appropriate. 

Elia also clarifies the roles and responsibilities of all its employees 

by providing a description of its procedures, in keeping 

with the Business Process Excellence methodology, and of 

each job. 



The structured approach developed by Elia helps 

to ensure that financial data is both exhaustive and 

precise, taking into account the deadlines for activity 

reviews and the actions of key players so as to ensure 

adequate control and accounting. 

COMPETENCIES 

With a view to ensuring its various activities are performed reliably 

and effectively, Elia clearly spells out the vital importance of 

its employees’ competencies and expertise in its recruitment, 

training and retention procedures. The Human Resources Department 

has drawn up the appropriate policies and defined all 

jobs in order to identify the relevant roles and responsibilities as 

well as the qualifications needed to fulfil them. 

Elia has drawn up a policy for the management of generic and 

specific competencies in line with the company’s values, and 

promotes training so as to enable all its employees to effectively 

perform the tasks allocated to them. Requirements with 

regard to competency levels are continually analysed by means 

of formal and informal (self-)assessments at various stages of 

an employee’s career. 

Training programmes on financial reporting are offered to all 

employees involved directly or indirectly with that task. The 

training lays an emphasis on the existing regulatory framework, 

accounting obligations and actual activities, with a high level of 

understanding enabling participants to address the appropriate 

issues. 

* See the sections relating to the committees for more information. 

97

98 



2. Risk assessment 

Risk assessments are crucial in helping Elia to achieve its strategic 

objectives as defined in its mission. The Board of Directors 

and Risk Manager jointly and regularly identify and assess 

key financial and non-financial strategic risks. The risks are 

assessed qualitatively or quantitatively and according to their 

probability. The Risk Manager then makes recommendations. 

Based on the assessment, preventive, remedial and corrective 

action plans are implemented wherever existing internal control 

activities need to be strengthened. 

The objectives set for the entire Group feed through to each 

level of the organisation. Assessments are performed annually 

to determine how well those objectives have been achieved. 

As part of its responsibilities, the management establishes an 

effective internal control system to ensure accurate financial reporting, 

among other things. It emphasises the importance of 

risk management in financial reporting by taking into account, 

with the Audit Committee, a whole range of associated activities 

and risks. It ensures that risks are truly reflected in financial 

results and reports. 

Financial risk assessments primarily involve the identification 

of: 

(i) significant financial reporting data and its purpose; 

(ii) major risks involved in the attainment of objectives; 

(iii) mechanisms for controlling misreporting risks. 

Financial reporting objectives include (i) ensuring financial statements 

comply with widely accepted accounting principles; (ii) 

ensuring that the information presented in financial results is 

both transparent and accurate; (iii) the use of accounting principles 

appropriate to the sector and the company’s transactions; 

(iv) ensuring the accuracy and reliability of financial results. 

The activities undertaken by Elia, as a power transmission system 

operator, in relation to its physical installations contribute 

significantly to financial results. Therefore, appropriate procedures 

and control systems have been established to ensure the 

exhaustiveness and physical existence of installations. 

Elia has established an enterprise risk management (ERM) culture 

to ensure constant control. This approach incorporates 

the key policies and procedures set out in the risk management 

recommendations and Risk Management Charter. 

Risk awareness is supported by the delegation of relevant responsibilities 

to all employees as part of their specific activities, 

as defined in the Charter. 

CONTINUOUS ASSESSMENT 

Employing a simultaneously top-down and bottom-up approach 

enables Elia to identify and, where possible, quickly 

anticipate events and react to any incidents occurring inside 

or outside the organisation which might affect the attainment 

of objectives. 

TOP-DOWN APPROACH BASED ON STRATEGIC RISKS 

Strategic risk assessments are covered in a quarterly report 

to the Audit Committee. Action plans or specific additional assessments 

are put forward in the report in view of prospective 

events, whether they are perceived as threats or potential opportunities. 

BOTTOM-UP APPROACH WITH REGARD TO BUSINESS 

With a view to identifying new risks or evaluating changes in 

existing risks, the Risk Manager and management line remain 

in constant contact and look out for any change that may call 

for the relevant risk assessment and associated action plans 

to be amended. 

Various criteria are used to determine the need to re-evaluate 

financial reporting procedures and associated risks. They 

place an emphasis on risks associated with changes in the financial 

and regulatory context, industrial practices, accounting 

standards and corporate developments such as mergers and 

acquisitions. 

Operational management assesses the relevant risks and puts 

forward action plans. Any significant changes to assessment 

rules must be approved by the Board of Directors. 

In general, Risk Management helps Elia to maintain its value for 

stakeholders and the community, works with all departments 

with a view to optimising Elia’s ability to achieve its strategic 

objectives, and advises the company regarding the possibility 

or nature of future risks.

3. Control activities 

MAIN CONTROL ACTIVITIES 

Elia has established control activities at its various structural 

levels so as to ensure compliance with standards and internal 

procedures geared to the proper management of identified 

risks. These include: 

(i) clear task separation as part of procedures, preventing the 

same person from initiating, authorising and recording a 

transaction – policies have been drawn up regarding access 

to information systems and the delegation of powers; 

(ii) integrated audit methods as part of procedures so as to link 

end results with the transactions supporting them; 

(iii) data security and integrity through the appropriate allocation 

of rights; 

(iv) appropriate documentation of procedures through the use 

of the Business Process Excellence Intranet, which centralises 

policies and procedures. 

Departmental managers are responsible for establishing activities 

to control the risks inherent to their department. 

Elia takes all necessary measures to adapt its control activities 

where internal or external events are liable to affect existing 

processes. 

FINANCIAL REPORTING PROCEDURE 

For all significant financial reporting risks, Elia sets out appropriate 

control mechanisms to minimise the probability of error. 

Roles and responsibilities have been defined in connection 

with the closing procedure for financial results. 

Measures have been established for the continual follow-up of 

each stage, with a detailed agenda of all activities undertaken 

by Group subsidiaries; control activities are performed to ensure 

quality and compliance with internal and external requirements 

and recommendations. 

During closing, a specific test is performed to ensure control 

over significant unusual transactions (e.g. through data mining 

software), accounting lines and adjustments at the end of the 

relevant period, company transactions and critical estimates. 

All of these controls combined sufficiently ensure the reliability 

of financial results. Regular internal and external audits also 

contribute to financial reporting quality. 



Elia disseminates relevant information to 

its employees to enable them to fulfil their 

responsibilities and achieve their objectives. 

In identifying those risks affecting the achievement of financial 

reporting objectives, the management takes into account the 

possibility of misreporting associated with fraud and takes appropriate 

action where internal control needs to be strengthened. 

Internal Audit performs specific audits based on the risk 

assessment for potential fraud, with a view to avoiding and 

preventing any instances of fraud, and data mining software is 

used in areas susceptible to fraud. 

4. Information and communication 

99 

Elia disseminates relevant information to its employees to enable 

them to fulfil their responsibilities and achieve their objectives. 

Financial information is needed for budgeting, forecasts 

and ensuring compliance with the regulatory framework. Operational 

information is also vital for the production of various reports. 

As such, Elia records recent and historical data needed 

for corporate risk assessments. Multiple communication channels 

are used: manuals, memos, emails, bulletin boards and 

intranet applications. 

Established information systems are used to structure information 

from a range of different sources so as to ensure: (i) 

transactions are recorded and monitored in real time; (ii) data is 

entered within a time-frame and at a level of detail that meets 

risk management requirements; (iii) the quality of information 

through discussions at different levels: the information owner 

validates the relevant data before publication, the management 

checks its accuracy and reliability, and IT risks (such as the 

quality of IT developments or the stability of data transmission) 

are followed up by action plans. 

Financial results are reported internally and validated at different 

levels. The management responsible for financial reporting 

regularly meets other internal departments (operational and 

control departments) to identify financial reporting data. It validates 

and documents the critical assumptions underpinning 

booked reserves and the company’s accounts.

100 

At Group level, consolidated results are broken down into segments 

and validated by means of a comparison with historical 

figures and a comparative analysis between forecasts and actual 

data. This financial information is reported monthly to the 

Management Committee and is discussed quarterly with the 

Audit Committee. The Chairman of the Audit Committee then 

reports to the Board of Directors. 

5. Monitoring 



Financial information is needed for budgeting, 

forecasts and ensuring compliance with the 

regulatory framework. Operational information is 

also vital for the production of various reports. 

As such, Elia records recent and historical data 

needed for corporate risk assessments. 

Elia continually re-evaluates the adequacy of its risk management 

approach. Monitoring procedures include a combination 

of monitoring activities carried out as part of normal business 

operations, in addition to specific ad-hoc assessments on selected 

topics. 

Monitoring activities include (i) monthly reporting of strategic 

indicators to the Management Committee and the management; 

(ii) follow-up on key operational indicators at departmental 

level; (iii) a monthly financial report including an assessment 

of variations as compared with the budget, comparisons with 

preceding periods and events liable to affect cost controlling. 

Consideration is also given to third-party feedback from a 

range of sources, such as (i) stock market indices and reports 

by ratings agencies; (ii) share value; (iii) reports by federal and 

regional regulators on compliance with the legal and regulatory 

framework; (iv) reports by security and insurance companies. 

Comparing information from external sources with internally 

generated data and ensuing analyses allows Elia to keep on 

making improvements. 

Internal Audit also plays a key role in monitoring activities by 

conducting independent reviews of key financial and operational 

procedures in view of the various regulations applicable 

to Elia. The findings of those reviews are reported to the Audit 

Committee to help it monitor internal control and risk management 

systems and corporate financial reporting procedures. 

The Group’s legal entities are also subject to external audits, 

which generally entail an evaluation of internal control and remarks 

on (annual and quarterly) statutory and consolidated financial 

results. External auditors make recommendations for 

improving internal control systems. The recommendations, 

action plans and their implementation are reported annually 

to the Audit Committee, which in turn reports to the Board of 

Directors on the independence of the auditor or statutory audit 

firm and drafts a motion for a resolution on the appointment of 

external auditors.

Description of the risks 

and uncertainties facing 

the company 

1. Regulatory and income risks 

INTERNATIONAL 

The two transmission system operators in the Elia Group proactively 

anticipate European legislation, new directives and 

regulations being prepared at EU level or awaiting transposition 

into Belgian and German law in order to minimise uncertainties. 

Elia and 50Hertz Transmission are European leaders when it 

comes to the components of the European Commission’s third 

package of directives aimed at developing a single electricity 

and gas market, as regards both the independence and impartiality 

of the management. 

The provisions of the third package were transposed into Belgian 

and German law in 2012. Under these provisions, Elia System 

Operator and 50Hertz will be subject to new procedures, 

such as certification as a full-owned unbundled TSO. The timetable 

and results of these new procedures at European level 

may include regulatory risks for both companies. 

Elia and 50Hertz are also founding members of the European 

Network of Transmission System Operators for Electricity 

(ENTSO-E), which was set up in December 2008 and brings 

together 41 transmission system operators from 34 countries, 

including the EU Member States. Amongst other things, ENT- 

SO-E performs the role of the European Network of Transmission 

System Operators provided for in the third package. The 

Chairman of the Management Committee was re-elected as 

president of the association for another two years in June 2011. 

NATIONAL 

The Belgian legal framework was established when the first EU 

Directive on the internal electricity market was transposed by 

the Electricity Act of 29 April 1999. The company’s net profit 

is largely determined by the fair return, which, for the period 

2008-2011 contains an ‘incentive’ component spread over four 

years. Elia’s result will therefore be influenced annually, either 

positively or negatively, by its ability to achieve and/or exceed 

the efficiency improvement factor, by changes to Belgian linear 

bonds (10-year OLOs), and by the federal regulator’s analysis 

of the various budget items. On 22 December 2011, the tariffs 

and mechanisms determining Elia’s profitability as Belgium’s 

transmission system operator were approved by CREG for a 

new four-year tariff period, effective 1 January 2012. That approval 

was provisional since the third package of European directives 

had not been transposed into Belgian by that date. In 

addition, one or more customers may submit an appeal to the 



101 

Brussels Court of Appeal to contest the tariffs approved by 

CREG. This results in a legislative and regulatory risk likely to 

negatively impact the company’s profitability. 

On the other hand, Elia’s turnover also depends on the energy 

drawn off from its grid, and therefore on the level of business 

activity of its customers. The decline in residential consumption 

prompted by the slowdown in economic activity in 2009 has resulted 

in an income deficit compared with the tariffs approved 

by the regulator for 2008-2011. Under prevailing legislation, this 

deficit and the extra costs, such as additional financing, must 

be offset by the tariffs for the next regulatory period. The impact 

on the electricity consumption of Elia’s various customer 

segments and the uncertainty surrounding the outlook for an 

upturn in business amongst industrial customers continue to 

pose a risk to Elia’s cash flow. 

The regulatory framework for 50Hertz is based on an initial 

cost assessment and defines a revenue ceiling and efficiency 

incentives. It fixes the grid tariffs that include the remuneration 

based on a fixed return on capital invested for a five-year 

tariff period. The return for other regulatory periods will have 

to be confirmed subsequently. The German regulator has also 

defined a specific remuneration system for investments in the 

grid called ‘investment budgets’. To this end, 50Hertz files a 

request for approval of these budgets to ensure appropriate remuneration 

during the regulatory period. The investment budgets 

for various projects are currently in the approval process. 

Specific rules apply to costs and income generated by support 

programmes for renewable energy sources and cogeneration. 

The German government’s decision to shut down eight nuclear 

power stations following the incident in Japan results in additional 

costs for managing technical constraints on grids. The 

time it takes to offset the costs incurred means that 50Hertz 

prefinances its costs, which may have an impact on its cash 

flow and on its profit as defined by HGB accounting rules.

102 



REGIONAL 

The regulatory framework entails risks at regional level in Belgium. 

For instance, contradictions between the various regulations, 

including the grid codes, can hinder the exercise of the 

company’s activities. The further development of and changes 

to these regulations may also impact the company’s liability in 

the event of a power outage on the grid or – in the context of 

a reform of the State – the division of powers between federal 

and regional authorities, including the power to approve transmission 

tariffs. 

In addition, the regulatory uncertainty surrounding certain surcharges 

linked to, among other things, the green certificates 

mechanism means a risk that may affect cash flow and investment 

requirements. 

2. Operational risks 

SECURITY OF SUPPLY 

Every year, Elia and 50Hertz Transmission seek to contract the 

reserves needed to ensure continual balance between production 

and consumption in their respective zones. To that end, 

they analyse, at both national and European level, how the 

growing proportion of intermittent renewable energy generation 

units can be integrated without compromising the security. 

The growth across Europe in the number of cogeneration and 

renewable energy units connected to distribution systems and 

the future connection of large offshore wind farms also create 

new challenges for operational grid management and require 

the further development of their infrastructure. 

These developments, changing trends in offtake and the enhancement 

of interconnection capacity between EU member 

states are dependent on securing permits and approvals from 

local, regional, national and international authorities. The need 

to obtain such approvals and permits within certain timeframes 

represents a risk to timely implementation. Moreover, these approvals 

and permits can be contested in the relevant courts. 

Enhanced coordination at European level during the planning 

phase as well as during the phase immediately preceding real 

time has made it possible to minimise the impact of loop flows 

on available transmission capacity for commercial purposes. 

However, intervention to limit this - transmission capacity to 

guarantee reliability and supply quality as for as possible - cannot 

be ruled out, especially in view of the growing share accounted 

for by variable production (wind, solar). 

POWER OUTAGES 

The reliability of the transmission systems operated by Elia 

and 50Hertz is among the best in Europe. Nonetheless, unforeseen 

events, such as unfavorable weather conditions, may 

occur which interrupt the smooth operation of one or more infrastructure 

components. In most cases, these incidents have 

no impact on consumers’ power supply because the meshed 

structure of the grids operated by Elia and 50Hertz means that 

consumers can be reached via a number of different connections. 

However, in extreme cases an incident in the electricity 

system may lead to a local or widespread outage (known as a 

blackout). Such outages may be caused by natural phenomena, 

unforeseen incidents or operational problems, either in Belgium 

or abroad. Elia regularly holds crisis management drills so 

that it is ready to deal with the most unexpected and extreme 

situations. The general terms and conditions of its standard 

contracts limit the liability of Elia and 50Hertz to a reasonable 

level while its insurance policy is designed to offset the financial 

repercussions of these risks. 

RISKS ASSOCIATED WITH ELECTRONIC, IT AND 

TELECOMMUNICATION TECHNOLOGIES 

The incorporation of electronic, IT and telecommunication technologies 

in electricity transmission systems for the purposes 

of operational management, communication and surveillance 

(such as smart grids) modifies the nature of electricity systems 

and infrastructure used by TSOs such as Elia and 50Hertz. 

Failures in the telecommunications network or IT systems used 

to operate the electricity system may harm the latter’s performance. 

Elia takes appropriate measures to back up the IT network 

and associated systems to the maximum extent allowed 

by technical and financial considerations. It has drawn up and 

regularly tests recovery plans for the most critical IT systems. 

However, component failures in the telecommunication network 

and IT systems are impossible to rule out. Where systems 

do fail, Elia will strive to minimise the impact on customers. 

ENVIRONMENTAL RISK 

Elia’s results may be affected by outgoings needed to keep up 

with environmental legislation, including costs associated with 

implementing preventive or corrective measures or settling 

third-party claims. The company’s environmental policy is developed 

and monitored in such a way as to manage these risks. 

Where Elia might in any way be liable for decontamination, the 

appropriate provisions are set aside. Additional analyses are in 

progress and could lead to a revision of existing provisions or 

the adoption of new provisions. The same holds true for electric 

and magnetic fields.

RISK OF LEGAL DISPUTES 

Although the company operates in such a way as to minimise 

the risk of legal disputes, it may nonetheless become involved 

in such disputes. Where necessary, the appropriate provisions 

are laid aside for this. 

SAFETY AND WELFARE 

Elia operates facilities that may cause harm to the natural or 

human environment or for which accidents or external attacks 

may have major repercussions. Persons working in or near 

electricity transmission facilities may be exposed, in the event 

of an accident, error or negligence, to the risk of electrocution. 

The safety and welfare of individuals (both Elia personnel and 

third parties) is a daily priority for the Elia Group’s management, 

supervisory staff and personnel, and substantial resources are 

invested in safeguarding them. Each year, an action plan is 

approved and implemented based on developments in safety 

figures. 

RISKS ASSOCIATED WITH INEFFICIENT INTERNAL 

CONTROL MECHANISMS 

All internal processes can have an impact on the company’s 

results in some way. The multi-year tariff mechanism increases 

the need for year-on-year increases in the company’s overall 

efficiency. To this end, the efficiency of internal processes is 

monitored regularly, using performance indicators and/or audits, 

to ensure they are kept under proper control. This is overseen 

by the Audit Committee, which controls and monitors 

the work of the Internal Audit & Enterprise Risk Management 

Department. 

3. Financial risks 



Every year, Elia and 50Hertz Transmission seek 

to contract the reserves needed to ensure 

continual balance between production and 

consumption in their respective zones. To that 

end, they analyse, at both national and European 

level, how the growing proportion of intermittent 

renewable energy generation units can be 

integrated without compromising the security. 

103 

The Group is exposed to various financial risks in the exercise 

of its activities: market risk (namely interest rate risk, inflation 

risk, tax risk and limited exchange risk), liquidity risk and credit 

risk. The risks the company faces are identified and analysed 

in order to establish appropriate limits and controls and monitor 

risks and compliance with such limits. To this end, the Group 

has defined responsibilities and procedures specifically for the 

financial instruments to be used and the operating limits for 

managing them. These procedures and related systems are 

revised on a regular basis to reflect any changes in market conditions 

and the activities of the Group. The financial impact of 

these risks is limited, as Elia and 50Hertz are operating under 

the Belgian or German regulatory framework. See the ‘Regulatory 

framework’ section. 

To finance its investments and to achieve its short- and longterm 

strategic goals, Elia and 50Hertz turn to the capital 

markets. At the time of writing, the economic and financial 

environment in Europe has been shaken by the debt crisis affecting 

banks and the member states of the EU. This tension 

on the capital and credit market in a highly interdependent financial 

system may have an impact on loans to companies, 

in some cases reducing the financing capacity of Elia and/or 

50Hertz. This situation could have an adverse effect on Elia’s 

and 50Hertz’s future growth and on the pursuit of their objectives. 

Elia is partly financed with floating rate bonds. Although 

a financing policy has been approved that strives to achieve an 

optimal ratio between fixed and variable interest rates and appropriate 

financial instruments are used to mitigate the financial 

risk, a change in interest rates can have an impact on financial

104 



The risks the company faces are identified 

and analysed in order to establish appropriate 

limits and controls and monitor risks and 

compliance with such limits. 

charges passed on in a subsequent regulatory tariff period (or 

in the same period in the event of an exceptional change in 

charges). Financial charges are also related to the credit rating 

of the company. Elia cannot guarantee total protection in the 

event of significant movements in interest rates or in the event 

of a downgrading of its rating, or Eurogrid GmbH’s rating. For 

more information, see the section on ‘Financial risk and financial 

derivatives’ in the annual report. 

4A. New business developments 

The Elia Group strives to anticipate new opportunities relating 

to its core business, both inside and outside the Belgian regulated 

framework. The launch of international projects abroad 

may create risks associated with foreign regulations or uncertainties 

regarding the business plans to be drawn up. Efforts 

to identify and assess risks are carried out in parallel to the 

business plan in order to assess and manage the various risks. 

OFFSHORE GRID IN THE NORTH SEA 

Belgium has an installed generating capacity of 195 MW in offshore 

wind farms, comparable to Germany (195 MW) and the 

Netherlands (247 MW). The North Sea offshore grid project is 

part of a broader project to interconnect Belgium, the Netherlands, 

Germany, Denmark, Norway and the United Kingdom 

in a North Sea grid (North Sea Grid Initiative). Elia factors in 

risk areas such as technical feasibility, financial risks, impact on 

customers, environmental risks and permit risks. 

ATLANTIC WIND CONNECTION 

This is the first direct current high-voltage offshore grid, located 

off the East Coast of the United States. Elia is part of the consortium 

of companies that own the project. Elia takes account 

of the risks inherent in a business activity in a country whose 

legislative and regulatory framework and whose permitting 

procedures are different, while also factoring in the project’s 

financial aspects and governance. 

4B. Specific risks relating to Elia’s 

acquisition of 50Hertz 

As regards the acquisition of 50Hertz by Elia and IFM (through 

Eurogrid International CBVA/SCRL and Eurogrid GmbH), the 

possibility of a limited or non-existing recourse to Vattenfall 

concerning certain risks relating to the activities of 50Hertz 

cannot be excluded, nor can it be excluded that certain risks 

are not covered by representations and guarantees or allowances 

provided by Vattenfall. 50Hertz operates within the German 

legal and regulatory framework and may be subject to 

other constraints than Elia. Elia holds only 60% of the 50Hertz 

shares; the other 40% are held by IFM.

5. Contextual factors 

MACRO-ECONOMIC RISKS 

In recent months, all European economies have faced greater 

uncertainty and volatility, while the recovery expected after 

the multifaceted economic and financial crisis that emerged 

in 2007/2008 has proven to be premature. Even if the current 

liquidity crisis can be avoided, there remains uncertainty about 

how to solve the underlying long-term structural economic 

problems, such as national account imbalances and diverging 

levels of competitiveness between EU countries. Against 

this uncertain backdrop, an extended period of slow economic 

growth can have a negative impact on volumes of electricity 

transmitted and plans to develop the current grid and electricity 

generation assets (including renewable energy sources). In 

addition, the impact of the financial crisis has magnified the 

(upward and downward) volatility of factors influencing the financial 

results in connection with the current fair return mechanism, 

such as the Belgian 10-year linear bond and interest 

rates in Germany. 



HUMAN RESOURCES RISK 

Elia pursues an active image and recruitment policy to maintain 

an appropriate level of expertise and know-how in a tight labour 

market. This is an ongoing risk, bearing in mind the highly 

specialised and complex nature of its business. 

IMAGE RISK 

Generally speaking, circumstances may arise that have a negative 

impact on the company’s image. Elia has an internal control 

mechanism to guarantee the confidentiality of data. Despite 

this, external parties may pass on information in their possession 

that could have an impact on the company’s share price. 

MISCELLANEOUS 

Elia realises that there might be other risks of which the company 

is not yet aware. Some risks may seem limited today but 

increase in the future. The subdivisions used give no indication 

of the potential consequences of the listed risks. 

Elia and 50Hertz Transmission are European 

leaders when it comes to the components of the 

European Commission’s third package of directives 

aimed at developing a single electricity and gas 

market, as regards both the independence and 

impartiality of the management. 

105

05 

Financial 

Report 

The results of the year 2011 in details. 



107

108 



Consolidated financial 

statements IFRS 

Consolidated income statement 

(in million €) – Year ended 31 December Notes 2011 2010 

CONTINUING OPERATIONS 

Revenue (5.1) 1,188.2 939.5 

Raw materials, consumables and goods for resale (5.3.1) (5.9) (5.9) 

Gross profit 1,182.3 933.6 

Other income (5.2) 90.2 98.0 

Services and other goods (5.3.1) (638.4) (457.2) 

Personnel expenses (5.3.2) (158.4) (133.9) 

Depreciation, amortization, impairment and changes in provisions (5.3.3) (140.9) (127.5) 

Other expenses (5.3.4) (26.8) (31.1) 

Results from operating activities, before non-recurring items (REBIT) 308.0 281.9 

Gain on bargain purchase 0.0 286.5 

Non-recurring services and other goods 0.0 (8.0) 

RESULTS FROM OPERATING ACTIVITIES (EBIT) 308.0 560.4 

NET FINANCE COSTS (5.4) (128.6) (123.2) 

Finance income 14.2 21.8 

Finance costs (142.8) (145.0) 

Share of profit of equity accounted investees (net of income tax) (5.6) 1.4 (1.2) 

Profit before income tax 180.8 436.0 

Income tax expense (5.5) (43.3) (34.0) 

Profit from continuing operations 137.5 402.0 

Profit for the period 137.5 402.0 

Profit attributable to: 

Owners of the Company 137.5 401.7 

Non-controlling interest 0.0 0.3 

PROFIT FOR THE PERIOD 137.5 402.0 

Earnings per share (€) Notes 31.12.2011 31.12.2010 

Basic earnings per share (5.7) 2.28 7.36 

Diluted earnings per share (5.7) 2.28 7.36 

The accompanying notes are an integral part of these consolidated financial statements.

Consolidated statement of comprehensive income 


PROFIT FOR THE PERIOD 137.5 402.0 

Other comprehensive income 

Effective portion of changes in fair value of cash flow hedges (5.4) (3.9) (3.1) 

Tax on effective portion of changes in fair value of cash flow hedges (5.4) 1.3 1.1 

Defined benefit plan actuarial gains and losses (6.12) (16.3) 25.9 

Tax on defined benefit plan actuarial gains and losses (6.12) 5.5 (8.8) 

Exchange differences on translation of foreign operations 0.1 0.0 

Other comprehensive income for the period, net of income tax (13.3) 15.1 

Total comprehensive income for the period 124.2 417.1 

Profit attributable to: 



109 

Owners of the Company 124.2 416.8 


TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 124.2 417.1

110 



Consolidated statement of financial position 

ASSETS (in million €) Notes 31.12.2011 31.12.2010 

NON-CURRENT ASSETS 5,145.1 4,994.1 

Property, plant and equipment (6.1) 3,150.5 3,010.9 

Intangible assets (6.2) 1,753.6 1,751.1 

Trade and other receivables (6.3) 120.3 114.7 

Investments in equity-accounted investees (6.4) 30.6 29.2 

Other financial assets (including derivatives) (6.5) 84.9 79.5 

Deferred tax assets (6.6) 5.2 8.7 

CURRENT ASSETS 698.7 909.9 

Inventories (6.7) 16.3 14.5 

Trade and other receivables (6.8) 281.6 513.8 

Income tax receivable 10.0 6.3 

Cash and cash equivalents (6.9) 385.6 366.0 

Deferred charges and accrued revenues (6.8) 5.2 9.3 

TOTAL ASSETS 5,843.8 5,904.0 

EQUITY AND LIABILITIES (in millions €) Notes 31.12.2011 31.12.2010 

EQUITY 2,046.9 2,007.2 

Equity attributable to owners of the Company (6.10) 2,046.9 2,007.2 

Share capital 1,500.6 1,500.6 

Share premium 8.5 8.5 

Reserves 67.6 51.4 

Hedging reserve (23.3) (20.7) 

Retained earnings 493.5 467.4 



NON-CURRENT LIABILITIES 3,203.5 3,211.0 

Loans and borrowings (6.11) 2,918.5 2,917.3 

Employee benefits (6.12) 108.1 103.8 

Derivatives (7.3) 35.2 31.4 

Provisions (6.13) 53.7 44.6 

Deferred tax liabilities (6.6) 67.6 93.3 

Other liabilities (6.14) 20.4 20.6 

CURRENT LIABILITIES 593.4 685.8 

Loans and borrowings (6.11) 0.0 0.1 

Provisions (6.13) 24.5 43.6 

Trade and other payables (6.15) 366.1 448.8 

Income tax payables 26.0 14.0 

Accruals and deferred income (6.16) 176.8 179.3 

TOTAL EQUITY AND LIABILITIES 5,843.8 5,904.0

Consolidated statement of changes in equity 

(in million €) – Year ended 31 December 

Share 

capital 

Share 

premium 

Hedging 

reserve 

Foreign 

currency 

translation 

Retained 

earnings Total 



Non 

controlling 

interests 

BALANCE AT 1 JANUARY 2010 1,207.3 8.5 (18.7) - 168.2 1,365.4 1.7 1,367.1 

Profit for the period - - - - 401.7 401.7 0.3 402.0 

OCI: cash-flow hedges - - (2.0) - - (2.0) - (2.0) 

OCI: actuarial gain/(loss) - - - - 17.1 17.1 - 17.1 

Total comprehensive income for the year - - (2.0) - 418.8 416.8 0.3 417.1 

Total 

equity 

Retained earnings Eurogrid GmbH at 

acquisition date - - - - (1.6) (1.6) - (1.6) 

Shares issued 299.7 - - - - 299.7 - 299.7 

Costs of shares issued (6.4) - - - - (6.4) - (6.4) 

Deconsolidation non-controlling interest - - - - - - (2.0) (2.0) 

Dividends - - - - (66.6) (66.6) - (66.6) 

BALANCE AT 31 DECEMBER 2010 1,500.6 8.5 (20.7) - 518.8 2,007.2 - 2,007.2 

BALANCE AT 1 JANUARY 2011 1,500.6 8.5 (20.7) - 518.8 2,007.2 - 2,007.2 

Profit for the period - - - - 137.5 137.5 - 137.5 

OCI: cash-flow hedges - - (2.6) - - (2.6) - (2.6) 

OCI: actuarial gain/(loss) - - - - (10.8) (10.8) - (10.8) 

OCI: exchange differences - - - 0.1 - 0.1 - 0.1 

Total comprehensive income for the period - - (2.6) 0.1 126.7 124.2 - 124.2 

Dividends - - - - (84.5) (84.5) - (84.5) 

BALANCE AT 31 DECEMBER 2011 1,500.6 8.5 (23.3) 0.1 561.0 2,046.9 - 2,046.9 

111

112 

Consolidated statement of cash flows 


CASH FLOWS FROM OPERATING ACTIVITIES 


Adjustments for: 



Net finance costs (5.4) 134.3 124.0 

Income tax expense (5.5) 58.7 16.6 

Profit or loss of equity accounted investees, net of tax (5.6) (1.4) 1.2 

Depreciation of property, plant and equipment and amortisation 

of intangible assets (6.1 - 6.2) 139.7 114.5 

Gain on sale of property, plant and equipment and intangible assets (6.1 - 6.2) 11.7 7.6 

Impairment losses of current assets (5.3.4) 12.2 1.0 

Change in provisions (5.3.3) (25.3) (2.6) 

Change in fair value of derivatives (7.2) 1.1 0.9 

Change in deferred taxes (6.6) (15.3) 17.4 

Changes in fair value of financial assets through profit or loss (0.2) 3.3 

Change in non-cash items 0.0 0.0 

Gain on bargain purchase 0.0 (286.5) 

Cash flow from operating activities 453.0 399.4 

Change in inventories (6.7) (2.3) 0.3 

Change in trade and other receivables (6.8) 219.2 (43.0) 

Change in other current assets (6.8) 1.0 (12.7) 

Change in trade and other payables (6.15) (53.4) 119.2 

Change in other current liabilities (6.14 - 6.16) (42.3) 60.1 

Changes in working capital 122.2 123.9 

Interest paid (5.4) (139.6) (135.7) 

Income tax paid (5.5) (49.5) (19.9) 

Net cash from operating activities 386.2 367.7 

CASH FLOWS FROM INVESTING ACTIVITIES 

Acquisition of property, plant and equipment and intangible assets (6.1 - 6.2) (288.3) (199.5) 

Acquisition of subsidiary net of cash acquired 0.0 (278.8) 

Acquisition of equity accounted investees 0.0 (21.2) 

Acquisition of investment (7.1) (0.8) (0.0) 

Proceeds from sales of investments 0.1 8.6 

Interest received (5.4) 7.1 2.3 

Net cash used in investing activities (281.9) (488.6) 

CASH FLOW FROM FINANCING ACTIVITIES 

Proceeds from issue share capital 0.0 299.7 

Expenses related to issue share capital 0.0 (6.5) 

Dividends paid (-) (6.10) (84.5) (66.6) 

Repayment of borrowings (-) 0.0 (210.0) 

Proceeds from withdrawal borrowings (+) 0.0 297.6 

Non-controlling interest 0.0 (2.0) 

Net cash flow from (used in) financing activities (84.5) 312.2 

NET INCREASE (DECREASE) IN CASH 

AND CASH EQUIVALENTS 19.8 191.3 

Cash & Cash equivalents at 1 January 365.9 174.6 

Cash & Cash equivalents at 31 December 385.7 365.9 

Net variations in cash & cash equivalents 19.8 191.3

Notes to the consolidated 

financial statements 



1. Reporting entity 115 

2. Basis of preparation 115 

2.1. Statement of compliance 115 

2.2. Functional and presentation currency 115 

2.3. Basis of measurement 115 

2.4. Use of estimates and judgements 115 

2.5. Approval by the board of directors 116 

3. Significant accounting policies 116 

3.1. New, revised and amended standards and interpretations 116 

3.2. Basis of consolidation 117 

3.3. Foreign currency translation 118 

3.4. Financial instruments 118 

3.5. Balance sheet items 119 

3.6. Income statement items 123 

4. Segment reporting 124 

4.1. Segment Elia Transmission (Belgium) 124 

4.2. Segment 50Hertz Transmission (Germany) 126 

4.3. Reconciliation of segments with total of group 128 

5. Items of the consolidated income statement and other comprehensive income 128 

5.1. Revenue 128 

5.2. Other income 128 

5.3. Operating expenses 129 

5.3.1. Cost of materials, services and other goods 129 

5.3.2. Personnel expenses 129 

5.3.3. Depreciation, amortisation, impairment and changes in provisions 129 

5.3.4. Other expenses 129 

5.4. Finance income and expenses 129 

5.5. Income taxes 130 

5.6. Share in the results of associates 131 

5.7. Basic earnings per share 131 

5.8. Other comprehensive income 131 

113

114 



6. Items of the consolidated statement of financial position 131 

6.1. Property, plant and equipment 131 

6.2. Intangible assets 133 

6.3. Non-current trade and other receivables 134 

6.4. Equity-accounted investees 134 

6.5. Other financial assets 135 

6.6. Deferred tax assets and liabilities 135 

6.7. Inventories 136 

6.8. Current trade and other receivables 137 

6.9. Cash and cash equivalents 137 

6.10. Shareholders’ equity 137 

6.11. Interest-bearing loans and borrowings 138 

6.12. Employee benefits 139 

6.13. Provisions 143 

6.14. Other non-current liabilities 143 

6.15. Trade and other payables 143 

6.16. Accruals and deferred income 144 

7. Miscellaneous 144 

7.1. Effect of new acquisition 144 

7.2. Deconsolidation of Belpex NV/SA 146 

7.3. Financial risk and derivative management 146 

7.4. Commitment and contingencies 150 

7.5. Related parties 151 

7.6. Subsidiaries, joint ventures and associates 152 

7.7. Subsequent events 153 

7.8. Relationship with auditors 153 

7.9. Declaration by responsible persons 153

1. Reporting entity 

Established in Belgium, Elia System Operator SA (the ‘company’ 

‘Elia’) has its registered office at Boulevard de l’Empereur 20, 

B-1000 Brussels. The company’s consolidated financial statements 

for the 2011 financial year include those of the company 

and its subsidiaries (together referred to as the ‘Group’) and the 

Group’s interest in joint ventures and associates. 

The company is a limited liability company, with its shares listed 

on NYSE Euronext Brussels, under the symbol ELI. 

With the acquisition of German TSO 50Hertz, in cooperation 

with Industry Funds Management (IFM), the Elia Group develops, 

maintains and operates two major electricity networks 

located in Central and North West Europe: the Belgian transmission 

grid interconnected with France and the Netherlands 

and 50Hertz Transmission grid interconnected with Poland, 

Hungary and Denmark. These two grids connect producers to 

major industries and distribution system operators and ensure 

electricity imports and exports from and to other European 

countries in an efficient, reliable and secure way. Elia owns the 

entire Belgian very high voltage grid (150 to 380 kv) and some 

94% (ownership and user rights) of the high-voltage grid (30 

to 70 kv) with 5,606 km of overhead lines and 2,766 km of 

underground cables. 50Hertz owns the entire network (220 to 

380 kv) in its geographical area as well as the transmission grid 

in the Hamburg area and off-shore connections in the Baltic 

sea. The 50Hertz grid comprises 9.705 km of overhead lines 

and 150 km of underground cables. Elia Group’s investment 

in interconnection capacity with its neighbours makes it the 

most open and interconnected transmission system operator 

in Europe. 

2. Basis of preparation 

2.1. Statement of compliance 

The consolidated financial statements have been prepared in 

accordance with the International Financial Reporting Standards 

(IFRS), as adopted for use in the European Union. The 

Group has applied all new and revised standards and interpretations 

published by IASB and applicable to the Group’s activities 

which are in force for financial years starting on 1 January 


2.2. Functional and presentation currency 

The financial statements are presented in million euro (the functional 

currency of the Group), rounded to the nearest hundred 

thousand, unless stated otherwise. 

2.3. Basis of measurement 



The financial statements have been prepared on a historicalcost 

basis, except for the derivative financial instruments, 

which are estimated at fair value. Non-current assets and disposal 

groups held for sale are valued at the lowest of the carrying 

amount and the fair value less cost to sell, and employee 

benefits are valued at the present value of the defined benefit 

obligations, less plan assets. Changes in fair value of financial 

assets are recorded through profit and loss. 

2.4. Use of estimates and judgements 

115 

The preparation of financial statements in accordance with 

IFRS requires management to make judgements, estimates 

and assumptions that could affect the reported amounts of assets 

and liabilities and revenue and expenses. The estimates 

and underlying assumptions are based on historical experience 

and various other factors that are believed to be reasonable 

under the circumstances, the results of which form the 

basis for making judgements regarding the carrying amounts 

of assets and liabilities. Actual results could differ from these 

estimates. 

The estimates and underlying assumptions are reviewed on an 

ongoing basis. Revisions to accounting estimates are recognised 

in the period in which the estimate is revised if the revision 

only affects this period, or in the period in which the estimate 

is revised and future periods if the revision affects both 

current and future periods.

116 



Information about significant areas of estimation uncertainty 

and critical judgements in applying accounting policies that 

have the most significant effect on the amounts recognised in 

the consolidated financial statements is included in the following 

Notes: 

• Deferred tax assets are recognized for the carry forward 

of unused tax losses and unused tax credits to the extent 

that it is probable that future taxable profit will be available 

against which the unused tax losses and unused tax credits 

can be utilized. In making its judgment, management takes 

into account elements such as long-term business strategy 

and tax planning opportunities. Tax receivable: recovery 

of the tax receivables of Elia System Operator is deemed 

highly probable (see Note 5.5). 

• Credit risk related to customers: management closely reviews 

the outstanding trade receivables, also considering ageing, 

payment history and credit risk coverage (cf. Note 7.2). 

• Employee benefit obligations: the defined-benefit obligations 

are based on actuarial assumptions such as discount rate 

and expected rate of return on plan assets, which are extensively 

detailed in Note 6.12. 

• Provisions for environmental issues: at each year-end an estimate 

is made of future expenses in respect of soil pollution, 

based on the advice of an external expert. 

Provisions for “litigation” and for “rights to use land” are 

based on the value of the claims filed or on the estimated 

amount of the risk exposure. The expected timing of the 

rela t ed cash outflow depends on the progress and the duration 

of the associated process/procedures (cf. Note 6.13). 

• Impairment: the Group performs annual impairment tests on 

goodwill and on cash-generating units for which there are 

indicators that the carrying amount might be higher than the 

recoverable amount. This analysis is based upon assumptions 

such as market evolution, market share, margin evolution 

and discount rates (see Note 6.2). 

• Lease accounting: more information can be found in Note 7.4. 

• Hedging: changes in the fair value of the derivative hedging 

instrument designated as a cash flow hedge are recognised 

directly in other comprehensive income (OCI) to the extent 

that the hedge is effective. To the extent that the hedge is 

ineffective, changes in fair value are recognised in profit or 

loss (see Note 7.3). 

• Fair value adjustments for business combinations: in accordance 

with IFRS 3 ‘Business Combinations’, the Group 

re-measures the assets, liabilities and contingent liabilities 

acquired through a business combination to fair value. 

Where possible, fair value adjustments are based on external 

appraisals or valuation models, e.g. for contingent liabilities 

and intangible assets which were not recognized by 

the acquiree. Internal benchmarks are often used for valuing 

specific production equipment. All of these valuation methods 

rely on various assumptions such as estimated future 

cash flows, remaining useful economic life etc. (see Note 7.1). 

The accounting policies set out hereafter have been applied 

consistently to all the periods presented in these financial statements 

and have been applied by all Group entities. 

2.5. Approval by the Board of Directors 

These consolidated financial statements were authorised for 

issue by the Board of Directors on 22 March 2012. 

3. Significant accounting policies 

3.1. New, revised and amended standards 

and interpretations 

THE GROUP HAS APPLIED THE FOLLOWING 

INTERPRETATIONS AND AMENDMENTS: 

• Amendment to IAS 24 Related Party Disclosures (applicable 

to financial years as from 1 January 2011): clarifies the 

definition of a related party and modifies certain relatedparty 

disclosure for government-related entities. 

• Amendment to IAS 1 Presentation of financial statements 

– Clarifies that an entity will present an analysis of other 

comprehensive income for each component of equity, either 

in the statement of changes in equity or in the notes 

to the financial statements (applicable to financial years as 

from 1 January 2011). 

• Amendment to IAS 27 Consolidated and Separate Financial 

Statements (amendments applicable to financial years 

beginning on or after 1 July 2010). 

• Amendment to IAS 34 Interim financial reporting – Provide 

guidance to illustrate how to apply disclosure principles in 

IAS 34 (amendments applicable to financial years beginning 

on or after 1 January 2011). 

None of the above amendments to the policies for financial reporting 

had a significant impact on the consolidated financial 

statements. 

The following amended and new standards are effective but 

are not applicable to the Group: 

• Amendment to IAS 32 Financial Instruments: Presentation 

— Classification of Rights Issues (applicable to financial 

years as from 1 February 2010). 

• IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments 

(applicable to financial years as from 1 July 2010). 

• Amendment to IFRS 1 First-time Adoption of International 

Financial Reporting Standards — Limited exemption from 

comparative IFRS 7 disclosures for first-time adopters (applicable 

to financial years as from 1 January 2011). 

• Amendment to IFRIC 14 IAS 19 The Limit on a Defined 

Benefit Asset, Minimum Funding Requirements and their 

Interaction — Prepayments of a Minimum Funding Requirement 

(applicable to financial years as from 1 January 2011). 

• Amendment to IFRS 3 Business combinations (applicable 

to financial years as from 1 July 2010). 

• Amendment to IFRS 7 Financial Instruments – Guidance on 

the interaction between quantitative and qualitative disclo-

sures about the nature and extent of risks associated with 

financial instruments (applicable to financial years as from 

1 January 2011). 

• Amendment to IFRIC 13 Loyalty Programmes (applicable 

to financial years as from 1 January 2011). 

The standards and interpretations listed hereafter are published 

on the date of approval of these consolidated financial 

statements but are not yet effective, and the Group did not 

opt for early adoption 1 : 

• Amendment to IFRS 7 Financial Instruments: Disclosures 

on derecognition (applicable to financial years as from 

1 July 2011). 

• Amendment to IFRS 7 Financial Instruments: Disclosures 

– Amendments enhancing disclosures about offsetting of 

financial assets and financial liabilities (applicable to financial 

years as from 1 January 2013). 

• Amendment to IFRS 1 First time adoption, on fixed dates 

and hyperinflation (applicable to financial years as from 

1 July 2011). 

• Amendment to IAS 12 Income taxes - Deferred taxes: recovery 

of underlying assets (applicable to financial years as 

from 1 January 2012). 

• Amendment to IAS 1 Presentation of Financial statements 

– Amendments to revise the way other comprehensive income 

is presented (applicable to financial years as from 

1 July 2012). 

• Amendment to IAS 19 Employee benefits – amended 

Standard resulting from Post-Employment Benefits and 

Termination Benefits projects (applicable to financial years 

as from 1 January 2013). 

• IFRS 9 Financial instrument – Classification and measurement 

(applicable to financial years as from 1 January 2013). 

• IFRS 10 Consolidated financial statements: defines the 

principles of control and establishes controls as the basis 

for consolidation (applicable to financial years as from 

1 January 2013). 

• IFRS 11 Joint operations: reflection of joint arrangements 

by focusing on the rights and obligations of the arrangement 

rather than its legal form (applicable to financial years 

as from 1 January 2013). 

• IFRS 12 Disclosures of interests in other entities (applicable 

to financial years as from 1 January 2013). 

• IFRS 13 Fair value measurement (applicable to financial 

years as from 1 January 2013). 

• IAS 27 (revised 2011) Separate financial Statements (applicable 

to financial years as from 1 January 2013). 

• IAS 28 (revised 2011) Investments in Associates and Joint 

Ventures (applicable to financial years as from 1 January 

2013). 

1 The Group does not expect any major impact on its financial statements in the period of their initial 

application of the other standards and interpretations listed hereafter, except for IFRS 10 and IFRS 11, for 

which Elia started the assessment of their impact on its financial statements in 2011. 

3.2. Basis of consolidation 



117 

1. SUBSIDIARIES 

A subsidiary is an entity that is controlled by the company. 

Control means that the company has the power to directly 

or indirectly govern the financial and operating policies of an 

entity so as to obtain benefits from its activities. In assessing 

control, potential voting rights that are currently exercisable or 

convertible are taken into account. The financial statements of 

subsidiaries are included in the consolidated financial statements 

from the date that control commences until the date that 

control ceases. The accounting policies of subsidiaries have 

been changed when necessary to align them with the policies 

adopted by the Group. Losses applicable to the non-controlling 

interests in a subsidiary are allocated to the non-controlling 

interests even if doing so causes the non-controlling interests 

to have a deficit balance. 

2. ASSOCIATED COMPANIES 

Associated companies are those companies in which the 

company has significant influence, but not control, over the 

financial and operating policies. The consolidated financial 

statements include the Group’s share of the total recognised 

profits and losses of associated companies on the basis of the 

equity method, from the date that significant influence commences 

until the date that significant influence ceases. When 

the Group’s share of the losses exceeds its interest in an associated 

company, the Group’s carrying amount is reduced to nil 

and further losses are not recognised except to the extent that 

the Group has incurred legal or constructive obligations or has 

made payments on behalf of an associated company. 

3. JOINT VENTURES 

‘Joint ventures’ refers to jointly controlled entities, established 

pursuant to a contractual agreement and subject to the required 

approval for strategic, financial and operating decisions. 

Investments in joint ventures are consolidated proportionally: 

a proportionate part of the assets, equities & liabilities and 

income and expenditure statements must be in accordance 

with IFRS as applied by Elia, with similar items in the consolidated 

figures grouped into the same category. The gain or loss 

realised via the acquisition will be recognised as a surplus or 

as gain on bargain purchase. If, following integration, the joint 

venture takes over a controlled entity (authorised to manage, 

either directly or indirectly, the financial and operating activities 

of the subsidiary in question to derive benefit from those 

activities), the requirements set out in IFRS 3 Business Combinations 

must be applied. 

4. LOSS OF CONTROL 

Upon the loss of control, the Group derecognizes the assets 

and liabilities of the subsidiary, any non-controlling interests 

and the other components of other comprehensive income related 

to the subsidiary. Any surplus or deficit arising on the loss 

of control is recognized in profit or loss. If the Group retains any 

interest in the previous subsidiary, then such interest is measured 

at fair value at the date that control is lost. Subsequently

118 

it is accounted for as an equity-accounted investee or as an 

available-for-sale financial asset depending on the level of influence 

retained. 

5. ELIMINATION OF INTRA-GROUP TRANSACTIONS 

Intra-group balances and any unrealised gains or losses or 

revenue and expenses arising from intra-group transactions 

are eliminated when preparing the consolidated financial statements. 

Unrealised gains from transactions with associated companies 

are eliminated to the extent of the Group’s interest in the entity. 

Unrealised losses are eliminated in the same way as unrealised 

gains, but only to the extent that there is no evidence for 

impairment. 

3.3. Foreign currency translation 

FOREIGN CURRENCY TRANSACTIONS AND BALANCES 

Transactions in foreign currencies are converted into the functional 

currency of the Group, at the foreign exchange rate on 

the date of the transaction. Monetary assets and liabilities denominated 

in foreign currencies on the balance sheet date are 

converted at the foreign exchange rate on that date. Foreign 

exchange differences arising on conversion are recognised in 

profit or loss. 

Non-monetary assets and liabilities denominated in foreign 

currencies that are valued in terms of historical cost are converted 

at the exchange rate on the date of the transaction. 

FOREIGN OPERATIONS 

A foreign operation is an entity that is a subsidiary, associate, 

joint venture or branch of the reporting entity, the activities of 

which are based or conducted in a country or currency other 

than those of the reporting entity. 

The financial statements of all Group entities that have a functional 

currency different from the Group’s presentation currency 

are translated into the presentation currency as follows: 

• Balance sheets are translated at the exchange rate at reporting 

date. 

• Income statements are translated at the average exchange 

rate of the year. 

• Shareholder’s equity is translated at historical exchange 

rate. 



Exchange differences arising from the translation of the net 

investment in foreign subsidiaries, joint ventures and associates 

at closing exchange rates are included in shareholder’s 

equity under “cumulative translation adjustments” as part of 

the “Other comprehensive income”. At disposal of foreign subsidiaries, 

joint ventures and associates, cumulative translation 

adjustments is recognized in the income statement as part of 

the gain/loss of the sale. 

3.4. Financial instruments 

DERIVATIVE FINANCIAL INSTRUMENTS 

The Group sometimes uses derivative financial instruments to 

hedge its exposure to foreign exchange and interest rate risks 

arising from operating, financing and investment activities. In 

accordance with its treasury policy, the Group neither holds 

nor issues derivative financial instruments for trading purposes. 

However, derivatives that do not qualify for hedge accounting 

are accounted for as instruments held for trading purposes. 

Derivative financial instruments are recognised initially at fair 

value. Any gain or loss resulting from changes in the fair value is 

immediately booked in the income statement. Where derivative 

financial instruments qualify for hedge accounting, the reflection 

of any resultant gain or loss depends on the nature of the 

item being hedged. 

The fair value of interest rate swaps is the estimated amount that 

the Group would receive or pay to terminate the swap at the end 

of the reporting period, taking into account the current interest 

rates and the current creditworthiness of the swap counterparties 

and the Group. The fair value of forward exchange contracts 

is their quoted market price at the end of the reporting 

period, i.e. the present value of the quoted for ward price. 

DERIVATIVES USED AS HEDGING INSTRUMENTS 

Cash-flow hedges 

Changes in the fair value of the derivative hedging instrument 

designated as a cash flow hedge are recognised directly in 

other comprehensive income (OCI) to the extent that the hedge 

is effective. To the extent that the hedge is ineffective, changes 

in fair value are recognised in profit or loss. 

If the hedging instrument no longer meets the criteria for hedge 

accounting, expires or is sold, terminated or exercised, hedge 

accounting is discontinued prospectively. The cumulative gain 

or loss previously recognised in OCI remains there until the forecast 

transaction occurs. When the hedged item is a non-financial 

asset, the amount recognised in OCI is transferred, where 

justified, to the carrying amount of the asset. In other cases the 

amount recognised in OCI is transferred to profit or loss in the 

same period that the hedged item affects profit or loss. 

When a derivative or hedge relationship terminates, cumulative 

gains or losses still remain in OCI provided that the hedged 

transaction is still expected to occur. If the hedged transaction 

is no longer expected to take place, the cumulative unrealised 

gain or loss is removed from OCI and is immediately recognised 

in profit or loss. 

Hedging of monetary assets and liabilities 

Hedge accounting is not applied to derivative instruments that 

economically hedge monetary assets and liabilities denominated 

in foreign currencies. Changes in the fair value of such 

derivatives are recognised in profit or loss of foreign currency 

gains and losses.

3.5. Balance sheet items 

PROPERTY, PLANT AND EQUIPMENT 

Owned assets 

Items of property, plant and equipment are stated at cost (including 

the directly allocated costs such as finance costs) less 

accumulated depreciation and impairment losses (see chapter 

“Impairment”). The cost price of self-produced assets comprises 

the cost of materials, of direct labour and, where relevant, of 

the initial estimate of the costs of dismantling and removing the 

assets and restoring the site where the assets were located. 

If parts of an item of property, plant and equipment have different 

useful lives, they are accounted for as separate items of 

property, plant and equipment. 

Leased assets 

Leases under the terms of which the Group assumes substantially 

all the risks and rewards of ownership are classified as 

finance leases. Fixed assets used via a finance lease are stated 

at an amount equal to the lower of the fair value and the present 

value of the minimum lease payments at the start of the lease, 

less accumulated depreciation (see hereafter) and impairment 

losses (see chapter “Impairment”). Lease payments are accounted 

for as described in the chapter “Expenses”. 

Subsequent costs 

The Group recognises in the carrying amount of an item of 

property, plant and equipment the cost price of replacing part 

of such an item when that cost is incurred if it is probable that 

the future economic benefits embodied in the item will flow to 

the Group and the cost price of the item can be assessed reliably. 

All other costs are recognised in profit or loss as and 

when they are incurred. 

Depreciation 

Depreciation is recognised in profit or loss on a straight-line basis 

over the estimated useful life of each component of an item 

of property, plant and equipment. Land is not depreciated. The 

applied depreciation percentages are as follows: 

Administrative buildings 2.00 

Industrial buildings 2.00 – 4.00 

Overhead lines 2.00 – 4.00 

Underground cables 2.00 – 5.00 

Offshore cables 2.50 - 5.00 

Substations (facilities and machines) 2.50 – 6.67 

Remote control 3.33 – 12.50 

Dispatching 4.00 - 10.00 

Other property plant and equipment: 

fitting out rented buildings contractual period 

Vehicles 6.67 – 20.00 

Tools and office furniture 6.67 – 20.00 

Hardware 25.00 – 33.00 

% 

Depreciation methods, remaining useful lives and residual values 

of the property, plant and equipment are reassessed annually 

and are prospectively adjusted as the occasion arises. 

Dismantling obligation 

Provision is made for decommissioning and environmental 

costs, based on future estimated expenditures, discounted 

to present values. An initial estimate of decommissioning and 

environmental costs attributable to property, plant and equipment 

is recorded as part of the original cost of the related property, 

plant and equipment. 

Changes in the provision arising from revised estimates or discount 

rates or changes in the expected timing of expenditures 

that relate to property, plant or equipment are recorded as adjustments 

to their carrying value and depreciated prospectively 

over their remaining estimated economic useful lives; otherwise 

such changes are recognised in the income statement. 

The unwinding of the discount is included within the income 

statement as a financing charge. 

Derecognition 

An asset is no longer recognised on the balance sheet when 

the asset is subject to disposal or when no future economic 

benefits are expected from its use or disposal. Gains or losses 

arising from the de-recognition of the asset from the balance 

sheet (which is determined as the difference between the net 

disposal proceeds and the carrying amount of the asset) are 

included in profit or loss during the year in which the asset was 

derecognised from the balance sheet. 

INTANGIBLE ASSETS 



119 

Business combinations and goodwill 

Business combinations are accounted for using the acquisition 

method as at the acquisition date, which is the date on 

which control is transferred to the Group. Control is the power 

to govern the financial and operating policies of an entity so as 

to obtain benefits from its activities. In assessing control, the 

Group takes into consideration potential voting rights that currently 

are exercisable. 

The Group measures goodwill at the acquisition date as: 

• the fair value of the consideration transferred; plus 

• the recognised amount of any non-controlling interest in the 

acquiree; plus 

• if the business combination is achieved in stages, the fair 

value of the pre-existing equity interest in the acquiree; less 

• the net recognised amount (generally fair value) of the identifiable 

assets acquired and liabilities assumed. 

When the excess is negative, a bargain purchase gain is recognised 

immediately in profit or loss. 

The consideration transferred does not include amounts related 

to the settlement of pre-existing relationships. Such 

amounts generally are recognised in profit or loss.

120 



Transactions costs, other than those associated with the issue 

of debt or equity securities, that the Group incurs in connection 

with a business combination are expensed as incurred. 

Any contingent consideration payable is measured at fair value at 

the acquisition date. If the contingent consideration is classified 

as equity, then it is not re-measured and settlement is accounted 

for within equity. Otherwise, subsequent changes in the fair value 

of the contingent consideration are recognised in profit or loss. 

Goodwill is stated at cost price less accumulated impairment 

losses. Goodwill is allocated to cash-generating units and is 

not amortised but tested annually for impairment (see chapter 

“Impairment”). In the case of associated companies, the carrying 

amount of goodwill is included in the carrying amount of the 

investment in the associated company. 

Computer software 

Software licences acquired by the Group are stated at cost 

less accumulated amortisation (see below) and impairment 

losses (see chapter “Impairment”). 

Expenditure for research activities undertaken with the prospect 

of developing software within the Group is recognised in 

profit or loss as expenditure as incurred. Expenditure for the 

development phase of software developed within the Group is 

capitalised if: 

• the costs of development can be measured reliably; 

• the software is technically and commercially feasible and 

future economic benefits are likely; 

• the Group plans - and has sufficient resources - to complete 

development; 

• the Group plans to use the software. 

The capitalised expenditure includes cost of material, direct labour 

costs and overhead costs that are directly attributable to 

preparing the software for its use. Other costs are recognised 

in profit or loss as incurred. 

Licenses, patents and similar rights 

Expenditure on acquired licences, patents, trademarks and 

similar rights is capitalised and amortised on a straight-line basis 

over the contractual period, if any, or the estimated useful 

life. 

Subsequent expenditure 

Subsequent expenditure on capitalised intangible assets is capitalised 

only when it increases the future economic benefits embodied 

in the specific asset to which it relates. All other expenditure 

is recognised in profit or loss as expenditure as incurred. 

Amortisation 

Amortisation is recognised in profit or loss on a straight-line 

basis over the estimated useful life of intangible assets, unless 

the useful life is indefinite. Goodwill and intangible assets are 

tested systematically for impairment on each end of the reporting 

period. Software is amortised from the date it is available for 

use. The estimated useful lives are as follows: 

Licences 20.00 

Concessions contractual period 

Computer software 20.00 - 25.00 

Depreciation methods, remaining useful lives, and residual values 

of intangible assets are reassessed annually and are prospectively 

adjusted as the occasion arises. 

INVESTMENTS 

Each type of investment is recognised on the date of the transaction. 

Investments in equity securities 

Investments in equity securities are undertakings in which the 

Group does not have significant influence or control. This is the 

case in undertakings where the Group owns less than 20% of 

the voting rights. Such investments are designated as availablefor-sale 

financial assets and are measured at fair value. Any resulting 

changes in fair value, except those related to impairment 

losses and foreign exchange gains and losses, are recognised 

directly in other comprehensive income (OCI). On disposal of an 

investment, the cumulative gain or loss previously recognised 

directly in equity in OCI is recognised in profit or loss. 

Investments in debt instruments 

Investments in debt securities classified as held for trading purposes 

or as being available-for-sale are carried at fair value, with 

any resulting gain or loss respectively recognised in profit or loss 

or directly in equity. The fair value of these investments is determined 

as the quoted bid price at the end of the reporting period. 

Impairment charges and foreign exchange gains and losses 

are recognised in profit or loss. Investments in debt securities 

classified as held to maturity are measured at amortised cost. 

Other investments 

Other investments held by the Group are classified as availablefor-sale 

and are measured at fair value, with any resulting gain 

or loss recognised directly in equity. Impairment charges are 

recognised in other comprehensive income (OCI) (see chapter 

“Impairment”). 

TRADE AND OTHER RECEIVABLES 

Construction work in progress 

Construction work in progress is stated at cost price plus profit 

based on progress made to date, less a provision for foreseeable 

losses and less progress billing. The cost price comprises 

all expenditure directly related to specific projects, plus an allocation 

of fixed and variable overheads incurred during the 

Group’s contract activities based on normal operating capacity. 

%

Lease receivables 

Receivables from lease contracts are stated at an amount 

equal to the present value of the future net lease payments 

at the start of the contract. The values of the receivables are 

reduced in the course of the lease contract by the amount of 

the lease payments associated with the reimbursement of the 

principal amount. 

Trade and other receivables 

Trade receivables and other receivables are measured at amortized 

cost, less the appropriate allowance for amounts regarded 

as unrecoverable. 

INVENTORIES 

Inventories (spare parts) are stated at the lower of cost and 

net realisable value. Net realisable value is the estimated selling 

price less the estimated costs of completion and selling 

expenses. The cost of inventories is based on the weightedaverage-cost-price 

method. The cost includes the expenditure 

incurred in acquiring the inventories, and the direct costs of 

bringing them to their location and making them operational. 

Write-offs of inventories to net realisable value are recognised 

in the period in which the write-off occurred. 

CASH AND CASH EQUIVALENTS 

Cash and cash equivalents comprise cash balances, bank balances 

and deposits that can be withdrawn on demand. Overdrafts 

that are repayable on demand and form an integral part 

of the Group’s cash management are included as a component 

of cash and cash equivalents for the purpose of the statement 

of cash flows. 

IMPAIRMENT 

The carrying amount of the Group’s assets, excluding inventories 

(see chapter “Inventories”) and deferred taxes (see chapter 

“Income taxes”), are reviewed at the end of the reporting period 

for each asset to determine whether there is any indication 

of impairment. If any such indication exists, the recoverable 

amount of the asset is estimated. 

The recoverable amount of goodwill and intangible assets with 

an indefinite useful life and intangible assets that are not yet 

available for use is estimated at the end of each reporting period. 

An impairment loss is recognised whenever the carrying amount 

of an asset or its cash-generating unit exceeds its recoverable 

amount. Impairment losses are recognised in profit or loss. 

Recognised impairment losses relating to cash-generating 

units are allocated first to reduce the carrying amount of any 

goodwill allocated to cash-generating units and then to reduce 

the carrying amount of the other assets in the units on a prorata 

basis. 

After recognition of impairment losses, the depreciation costs 

for the asset will be adjusted for future. 



121 

An impairment loss in respect of a financial asset measured 

at amortised cost is calculated as the difference between its 

carrying amount and the present value of the estimated future 

cash flows discounted at the asset’s original effective interest 

rate. Losses are recognised in profit or loss and reflected in an 

allowance account against loans and receivables or held-tomaturity 

investments securities. Interest on the impaired asset 

continues to be recognised. When an event occurring after the 

impairment was recognised causes the amount of impairment 

loss to decrease, the decrease in impairment loss is reversed 

through profit or loss. 

Impairment losses on available-for-sale financial assets are 

recognized by reclassifying the losses accumulated in the fair 

value reserve in equity to profit or loss. The cumulative loss 

that is reclassified from equity to profit or loss is the difference 

between the acquisition cost, net of any principal repayment 

and amortisation, and the current value, less any impairment 

loss recognized previously in profit or loss. Changes in cumulative 

impairment losses attributable to application of the 

effective interest method are reflected as a component of interest 

income. If, in a subsequent period, the fair value of an 

impaired available-for-sale debt security increases and the increase 

can be related objectively to an event occurring after 

the impairment loss was recognised, then the impairment loss 

is reversed, with the amount of the reversal recognised in profit 

or loss. However, any subsequent recovery in the fair value of 

an impaired available-for-sale equity security is recognised in 

other comprehensive income. 

Calculation of the recoverable amount 

The recoverable amount of intangible assets and property, 

plant and equipment is determined as the higher of their fair 

value less costs to sell or value in use. In assessing value in use, 

the expected future cash flows are discounted to their present 

value using a pre-tax discount rate that reflects both the current 

market assessment of the time value of money and the 

risks specific to the asset. 

The Group’s assets do not generate cash flow that is independent 

from other assets and the recoverable amount is therefore 

determined for the cash-generating unit (i.e. the entire highvoltage 

network) to which the asset belongs. This is also the 

level at which the Group administers its goodwill and reaps the 

economic benefits of acquired goodwill. 

Reversals of impairment 

An impairment loss in respect of goodwill is not reversed. 

Impairment loss on other assets is reversed if there have been 

changes in the estimates used to determine the recoverable 

amount. 

An impairment loss is reversed only to the extent that the asset’s 

carrying amount does not exceed the carrying amount 

that would have been determined, net of depreciation or amortisation, 

if no impairment loss had been recognised.

122 

SHARE CAPITAL 



Transaction costs 

Transaction costs in respect of the issuing of capital are deducted 

from the capital received. 

Dividends 

Dividends are recognised as a liability in the period in which 

they are declared. 

INTEREST-BEARING LOANS 

Interest-bearing loans are recognised initially at fair value less 

related transaction costs. Subsequent to initial recognition, 

interest-bearing loans are stated at amortised cost price with 

any difference between cost price and redemption value being 

recognised in profit or loss over the period of the loans on an 

effective interest basis. 

EMPLOYEE BENEFITS 

Defined-contribution plans 

Obligations related to contributions to defined-contribution 

pension plans are recognised as an expense in profit or loss 

as incurred. 

Defined-benefit plans 

For defined-benefit plans, the pension expenses are assessed 

on an annual basis by accredited actuaries separately for each 

plan by using the projected unit credit method. The estimated 

future benefit that employees have earned in return for their 

service in the current and prior periods is discounted to determine 

its present value, and the fair value of any plan assets is 

deducted. The discount rate is the interest rate as at the end of 

the reporting period on high-quality bonds which have maturity 

dates that approximate the terms of the Group’s obligations and 

that are denominated in the currency in which the benefits are 

expected to be paid. When the benefits of a plan are improved, 

the portion of the increased benefit relating to past service by 

employees is recognised as an expense in profit or loss on a 

straight-line basis over the average period until the benefits become 

vested. To the extent that the benefits are vested immediately, 

the expense is recognised immediately in profit or loss. 

All actuarial gains and losses as at 1 January 2004, the date 

of transition to IFRS, were recognised in the opening reserves. 

Actuarial gains and losses are immediately recognised as liabilities 

and do not affect the income statement, but are immediately 

recognised in OCI. The amount charged in profit or loss 

consists of current service cost, interest costs, the expected 

return on any plan assets and the past service cost. 

Where the calculation results in a benefit to the Group, the recognised 

asset is limited to the balance of past service costs 

and the present value of any future refunds from the plan or 

reductions in future contributions to the plan. 

Other long-term employee benefits 

The Group’s net obligation in respect of long-term service benefits, 

other than pension plans, is assessed on an annual basis 

by accredited actuaries. The net obligation is calculated using 

the projected unit credit method and is the amount of future 

benefit that employees have earned in return for their service in 

the current and previous periods. The obligation is discounted 

to its present value and the fair value of any related assets is 

deducted. The discount rate is the yield as at the end of the 

reporting period on high-quality bonds having maturity dates 

that approximate to the terms of the Group’s obligations and 

that are denominated in the currency in which the benefits are 

expected to be paid. 

Short-term employee benefits 

Short-term employee benefits are measured on an undiscounted 

basis and are expensed as the related service is provided. 

A liability is recognised as for the amount expected to be paid 

out under a short-term cash bonus or profit-sharing plans if the 

Group has a legal or constructive obligation to pay this amount 

as a result of the past service provided by the employee and 

the obligation can be estimated reliably. 

PROVISIONS 

A provision is recognised in the balance sheet when the Group 

has a current legal or constructive obligation as a result of a 

past event and it is likely that an outflow of economic benefits 

- of which a reliable estimate can be made - will be required 

to settle the obligation. If the effect is material, provisions are 

determined by discounting the expected future cash flows at 

a pre-tax rate that reflects the current market assessment of 

the time value of money and, where appropriate, of the risks 

specific to the liability. 

If the Group expects to recover some or all of the provisions 

from a third party, the compensation is only included as a separate 

asset if it is virtually certain that said compensation will be 

awarded. The cost connected to a provision is included in profit 

or loss net of any compensation. 

The total estimated cost of dismantling and disposal of an asset 

are, if applicable, recognised as property, plant and equipment 

and depreciated over the asset’s entire useful life. The 

total estimated cost of dismantling and of disposal of the asset, 

is posted as provisions for the discounted current value. If the 

amount is discounted, the increase of the provision due to the 

lapse of time is classified as finance expenses. 

TRADE AND OTHER PAYABLES 

Trade and other payables are stated at amortised cost. 

GOVERNMENT GRANTS 

Government grants are recognised when it is reasonably certain 

that the Group will receive the grant and that all underlying 

conditions will be met. Grants related to an asset are presented 

under other liabilities and will be recognised in the income statement 

on a systematic basis over the expected useful life of the 

related asset. Grants related to expense items are recognised 

in the income statement in the same period as the expenses, 

for which the grant was received. Government grants are presented 

as other operating income in the income statement.

3.6. Income statement items 

REVENUE 

Revenue is recognised when it is probable that the company 

will enjoy the economic benefits associated with the transaction 

and the income can be measured reliably and recovery of 

the compensation due is likely. 

Goods sold and services rendered 

Revenue from services and the sale of goods is recognised in 

profit or loss when the significant risks and rewards of ownership 

have been transferred to the buyer. 

Construction work in progress 

As soon as the outcome of a construction contract can be estimated 

reliably, contract revenue and expenses are recognised 

in profit or loss in proportion to the stage of completion of the 

contract. An expected loss on a contract is immediately recognised 

in profit or loss. 

Transfer of assets from customers 

The revenue from customers (financial contribution) for the 

construction of connections and related grid enhancement to 

the high-voltage grid is recognised in profit or loss on the basis 

of the stage reached in recovery of the underlying property, 

plant and equipment. 

EXPENSES 

Operating lease payments 

Payments made under operating leases are recognised in 

profit or loss on a straight-line basis over the term of the lease. 

Lease incentives received to conclude the leasing agreement 

are recognised in profit or loss as an integral part of the total 

lease expenses. 

Finance lease payments 

Payments made under finance lease payments are apportioned 

between the financing charges and the reduction of the outstanding 

liability. The financing charges are allocated to each 

period of the total lease term so as to produce a constant periodic 

rate of interest over the remaining balance of the liability. 

FINANCE INCOME AND EXPENSES 

Finance expenses comprise interest payable on borrowings, 

calculated using the effective interest rate method, foreign 

exchange losses, gains on currency hedging instruments 

offsetting currency losses, results on interest rate hedging 

instruments, losses on hedging instruments that are not part 

of a hedge accounting relationship, losses on financial assets 

classified as for trading purposes and impairment losses on 

available-for-sale financial assets as well as any losses from 

hedge ineffectiveness. Net finance expenses comprise interest 

on loans, calculated using the effective interest rate method 

and foreign exchange gains and losses. 

Interest income is recognised in profit or loss as it accrues using 

the effective interest rate method. 



123 

Borrowing costs that are not directly attributable to the acquisition, 

construction or production of a qualifying asset are recognised 

in profit or loss using the effective interest method. 

INCOME TAXES 

Income taxes comprise current and deferred tax. Income tax 

expense is recognised in profit or loss, except to the extent that 

it relates to items recognised directly in equity. 

Current tax is the expected tax payable on taxable income of 

the year, using tax rates enacted or substantively enacted at 

the end of the reporting period, and any adjustments to tax 

payable in respect of previous years. 

Deferred tax is recognised using the balance sheet method, on 

temporary differences arising between the carrying amounts 

of assets and liabilities for financial reporting purposes and 

the amounts used for taxation purposes. Deferred tax is not 

recognised for the following temporary differences: the initial 

recognition of assets or liabilities in a transaction that is not a 

business combination and that affects neither accounting nor 

taxable profit, and differences relating to investments in subsidiaries 

and jointly controlled entities to the extent that it is 

probable that they will not reverse in the foreseeable future. In 

addition, deferred tax is not recognised for taxable temporary 

differences arising from initial recognition of goodwill. Deferred 

tax is measured at the tax rates that are expected to be applied 

to the temporary differences when they are reversed, based on 

the laws that have been enacted or substantively enacted by 

the reporting date. Deferred tax assets and liabilities are offset 

if there is a legally enforceable right to offset current tax liabilities 

and assets, and they relate to income taxes levied by the 

same tax authority on the same taxable entity, or on different 

tax entities, but they intend to settle current tax liabilities and 

assets on a net basis or their tax assets and liabilities will be 

realised simultaneously. 

A deferred tax asset is recognised only to the extent that it is 

likely that future taxable profits will be available against which 

the asset can be utilised. Deferred tax assets are reduced to 

the extent that it is no longer likely that the related tax benefit 

will be realised. 

Additional income taxes that arise from the distribution of dividends 

are recognised at the same time as the liability to pay 

the related dividend.

124 

4. Segment reporting 

The Group has opted for a geographical segmentation since 

this segmentation forms the basis of the Company’s internal 

management reporting and enables the Chief Operating Decision-Maker 

(CODM) to evaluate and assess the type and financial 

profile of its activities in a transparent way. 

Pursuant to IFRS 8, the Group has identified the following operating 

segments based on the aforementioned criteria: 

• Elia Transmission (Belgium), which comprises Elia 

System Operator and the companies whose activities are 

directly linked to the role of Belgian transmission system 

operator (i.e. group before the acquisition of 50Hertz); 

• 50Hertz Transmission (Germany), which comprises 

Eurogrid International SCRL and companies whose activities 

are directly linked to the role of transmission system 

operator in Germany. 

The two operating segments also have been identified as the 

cash generating units of the group, as the group of assets managed 

by both segments independently generates cash flows. 

The Chief Operating Decision-Maker (CODM) has been identified 

by the Group as being the Boards of Directors, the CEO’s 

and the Executive Committees of each segment. The Chief 

Operating Decision-Maker periodically reviews the Group’s 

segments performance against a certain number of indicators, 

such as revenue, EBITDA and operating profit. 

The Company’s geographical segments are mainly characterized 

by common revenue and cost drivers and the same public 

service mission in their respective geographical area, but they 

distinguish themselves mainly at the level of the specific country 

related regulatory frameworks. For more details around this 

topic we refer to the chapter on “Regulatory framework and 

tariffs”. 

The information presented to the CODM follows the IFRS accounting 

policies of the Group, therefore no reconciling items 

have to be disclosed. Intergroup transactions are concluded on 

an at arm’s length basis. 

As described by IFRS 8 the Group is required to report segment 

information about each operating segment that exceeds 

certain quantitative thresholds. Since the operational activities 

of Atlantic Grid (see Note 7.1) do not exceed the threshold, its 

operations have been aggregated in the reporting segment 

50Hertz Transmission (Germany), because its activities are 

regularly evaluated by the CODM of that segment. 

4.1. Segment Elia Transmission (Belgium) 

KEY FIGURES 

(See table below) 

Results Elia Transmission 2011 2010 Difference (%) 

(in million €) – for the period ended 31 December 

Revenue 801.8 763.3 5.1 

Depreciation, amortization, impairment and changes in provisions (102.3) (107.1) (4.5) 

EBITDA* 354.0 336.8 5.1 

Operating profit (EBIT)* 251.7 229.6 9.6 

Finance income 10.6 17.0 (37.6) 

Finance costs (128.2) (129.7) (1.2) 

Income taxes (29.8) (20.8) 43.3 

Basic earnings, attributable to the Owners of the Company 105.7 94.6 11.7 

BALANCE SHEET 



Total assets** 4,473.8 4,518.1 (1.0) 

Capital expenditures 118.1 113.9 3.7 

Net financial debt 2,448.1 2,385.2 2.6 

* EBIT = earnings before interest and taxes 

EBITDA = EBIT + depreciation / amortization + changes in provisions 

** This section includes a reclassification of the figures per 31 December 2010 for comparison reasons

In 2011, Elia Transmission’s revenue in Belgium increased to €801.8 million, up 5.1% compared to the same period last year. 

The table hereafter provides more details of changes in the various revenue components. 

(in million €) – for the period ended 31 December 

DETAIL REVENUE 

2011 2010 Difference (%) 

Grid connection revenue 34.8 33.6 3.6 

Grid use revenue 533.0 539.2 (1.1) 

Revenues from the reversal of surpluses from previous years 

(decision by the regulator) 46.0 34.1 34.9 

Ancillary services revenue 108.2 115.2 (6.1) 

International revenue 23.5 28.0 (16.1) 

Other revenue 53.7 50.3 6.8 

Subtotal revenue 799.2 800.4 (0.1) 

Deviations from approved budget (settlement mechanism) 2.6 (37.1) n.r. 

TOTAL REVENUE 801.8 763.3 5.0 

Grid connection revenue rose by 3.6%, mainly due to an increase 

in the number of new connections by industrial customers 

compared to the previous year. 

Grid use revenue remained more or less at the same level as 

in 2010. The lower volumes as a result of the economic crisis, 

mild temperatures and the rise in decentralised generation (especially 

in the second half of 2011) compared with the previous 

year were offset by surplus revenue from grid imbalances. 

Revenue from reversal of surpluses from previous years 

increased by 34.9% to €46 million as agreed with the regulator 

in the tariffs for 2008-2011. As a result, all the remaining 

surpluses from the period from 2002 up to and including 2006 

were returned to customers. The disappearance of these tariff 

surpluses is one of the reasons for the rise in tariffs for the 

period 2012-2015. 

Ancillary services revenue dropped by 6.1% due to a lower 

level of off-takes from the Elia grid and lower purchasing costs, 

which have to be passed on. 

International revenue fell by 16.1% compared to 2010, mainly 

as a result of further optimisation of the utilisation of border 

capacity due to market coupling with Belgium’s neighbours. 



Other revenue rose slightly from €50,3 million to €53.7 million, 

primarily on account of the application of IAS 19 2 (up €7.4 

million), the deconsolidation of Belpex (down €2.9 million) and a 

decrease in own produced assets (down €1.1 million). 

In comparison with the tariff approved for 2011 by CREG in 

late 2007 as regards non-controllable costs and revenue, an 

operational tariff deficit of €2.6 million has been established (to 

be passed on to the tariffs of the next tariff period). 

The EBITDA (up 5.1%) and the EBIT (up 9.6%) rose sharply in 

2011 compared with 2010, mainly due to the increase in revenue. 

Net finance expenses (up 4.4%) were adversely affected by 

the absence of capital gains on the sale of Belpex in 2010 (€8.4 

million), which was partly offset by more revenue from surplus 

cash and lower general bank charges. 

Income tax expense (up 43.3%) rose more rapidly than the 

net profit, both because tax-free capital gains were achieved 

on financial fixed assets (cf. Belpex) in 2010 and due to an increased 

taxable profit in 2011 (for example due to higher OLOs) 

and taxes on the efficiency gains made in both 2010 and 2011 

at the marginal rate of 33,99%. 

2 IAS 19: Annual recalculation of recoverable costs in relation to future retirement obligations. 

125

126 

Consolidated IFRS profit after income tax rose by 11.7% 

from €94.6 million in 2010 to €105.7 million in 2011 due to the 

following items 3 : 

1. increase in regulated profit due to high OLOs (+€10.3 million); 

2. increased additional savings and revenue ( +€1.8 million); 

3. court ruling on the CREG decision regarding 2009 decision 

of CREG on regulated balances 2010 having an influence 

on 2010 and 2011 4 (- €1.7 million); 

4. absence of the 2010 costs pertaining to the capital increase 

for acquisition of 50Hertz minus costs for Eurogrid 

International (+€6.1 million); 

5. absence of the 2010 capital gains (60%) on the sale and 

deconsolidation of Belpex in 2010 (- €5.1 million); 

6. decrease in IFRS adjustments in 2011 compared to 2010 

(- €0.3 million). 

Total assets decreased slightly (by 1%) to €4,473.8 million, 

while the net financial debt went up 2.6% or €62.9 million, 

primarily as a result of an increase in working capital due to 

repayment of the outstanding tariff surpluses. 

4.2. Segment 50Hertz Transmission 

(Germany) 

The table hereafter shows the 2011 results of 50Hertz Transmission’s 

transmission system operator activities in Germany 

as per International Financial Reporting Standards (IFRS). 

The results of 50Hertz Transmission for 2011, consolidated at 

Eurogrid International level (60% proportional consolidation), 

include the entire 12 months for the first time, in contrast with 

the 2010 figures, which reflected only the period from June to 

December (inclusive). Consequently, the 2011 figures are best 

compared to the 12-month pro forma figures for 2010 (last column) 

compiled in accordance with International Financial Reporting 

Standards (IFRS). 

3 Items 1-5 relate to the regulatory framework in Belgium. 

4 In a decision of 25 June 2010 relating to 2009, CREG (federal regulator) indicated that it did not agree 

with certain aspects of the results. Elia contested several provisions of this decision before the Court 

of Appeal. The Court of Appeal’s final decision of 31 May 2011 was factored into the figures for 2011. 

Elia received CREG’s final decision with regard to financial year 2010 on 17 February 2012. In line with 

the decision of the Court of Appeal regarding 2009 the federal regulator has decided that the obtained 

efficiency gains had, according to the Royal Decree of 8 June 2007, to be taxed at the marginal rate of 

33,99%. 

Results 50Hertz Transmission 2011 2010 Difference 2010 

(in million €) 

60% proportional consolidation – for the period ended 31 December 

12 months 7 months % 12 months 

unaudited 

Pro forma 

Revenue 477.7 275.0 73.7 475.0 

Depreciation, amortization, impairment and changes 

in provisions (38.6) (20.3) 90.1 (38.9) 

REBITDA* 94.9 72.6 30.7 124.1 

EBITDA* 94.9 351.2 (73.0) 402.6 

Operating profit (REBIT*) 56.3 52.3 7.7 85.2 

Operating profit, including non-recurring items (EBIT*) 56.3 330.8 (83.0) 363.7 

Finance income 3.6 4.8 (25.0) 1.3 

Finance costs (14.6) (15.3) (4.6) (17.7) 

Income taxes (13.5) (13.2) 2.3 (23.7) 

Basic earnings, including non-recurring items, 

attributable to the Owners of the Company 31.8 307.1 (89.6) 323.6 

Basic earnings, excluding non-recurring items, 

attributable to the Owners of the Company 31.8 28.6 11.2 45.0 

BALANCE SHEET 



Total assets 1,370.3 1,386.8 (1.2) - 

Capital expenditures 152.3 107.5 41.6 - 

Net financial debt 84.8 166.3 (49.0) - 

* EBIT = earnings before interest and taxes 

REBIT = recurring EBIT (excluding one-off items) 

EBITDA = EBIT + depreciation / amortization + changes in provisions 

REBITDA = recurring EBITDA (excluding one-off items)

50Hertz Transmission’s revenue remained fairly stable compared to the same period last year. This revenue is described in 

more detail in the table below. 

2011 2010 Difference (%) 

(in million €) – for the period ended 31 December Pro forma 

DETAIL REVENUE 

Vertical grid revenue 369.8 384.0 (3.7) 

Horizontal grid revenue 13.6 17.3 (21.4) 

Ancillary services revenue 56.2 76.4 (26.5) 

Other revenue 37.7 28.4 32.8 

Subtotal revenue 477.3 50.1 (5.7) 

Deviations from approved budget (settlement mechanism) 0.5 (31.1) n.r. 

TOTAL REVENUE 477.7 475.0 0.6 

Vertical grid revenue pertains to the use of the 50Hertz grid. 

The 3.7% downturn is a result of lower volumes drawn from 

the grid mainly as a result of a larger share of decentralised 

generation. 

Horizontal grid revenue pertains to revenue for the use of the 

sea cable between Germany and Denmark (Kontek cable) as 

well as all revenue from auctioned transmission capacity on 

the border with the Czech Republic, which also connects the 

50Hertz grid with TenneT Germany. The 21.4% downturn is due 

mainly to lower price differences between Denmark (Nord Pool 

Spot) and Germany (EPEX Spot) thanks to the market coupling 

with Benelux, Germany and France. 

Ancillary services revenue concerns mainly passing on to 

grid users costs (generation reserve capacity and balancing 

costs) that 50Hertz incurs in order to balance generation with 

demand in the area. This revenue fell significantly due to ongoing 

optimisation of system control between the four German 

TSOs and due to the fact that the revenue from the EEG 5 imbalances 

is allocated directly to EEG activity. 

Other revenue pertains primarily to telecom revenue, subsidies, 

capitalised costs of own works, technical services and 

expertise to third parties and contributions from customers. 

The sharp rise is the result of a one-off EEG bonus of €11.4 million 

6 . 

Owing to the acquisition of 50Hertz Transmission, the corresponding 

purchase price has been recorded in the financial 

statement of 2010. Under IFRS a goodwill allocation or a gain 

on bargain purchase has been made with the help of a Purchase 

Price Allocation or ‘PPA’. In a PPA, all property, debts 

and (conditional) services to be identified are valued at fair val- 



127 

ue. This PPA exercise was carried out for Eurogrid GmbH (German 

financing and acquisition structure above 50Hertz Transmission), 

yielding Eurogrid GmbH a one-off and definite income 

(gain on bargain purchase) of €477.5 million (€286.5 million for 

60%). The absence of this one-off profit in 2011 explains the 

sharp drop compared to 2010 in EBITDA, EBIT and net profit, 

including non-recurring items. In 2011 it became apparent that 

no further modifications are needed for the 2010 PPA. 

The drop in REBITDA and REBIT is mainly due to one-off corrections 

in 2010 (€5.5 million), the absence of one-off auction 

revenue booked in 2010 (€9.6 million) and higher personnel and 

maintenance costs (€9.6 million). 

The net finance expenses were positively influenced by more 

revenue from surplus cash (strong improvement in cash position 

due to a drop in working capital for EEG) as well as lower 

general bank costs. 

The net profit (excluding non-recurring topics) decreased in 

line with the lower operating profit. 

The net financial debt consists of a €500 million 10-year Eurobond 

issued in October 2010 and a cash position of €355 million, 

of which €43.8 million is related to EEG activities. Of these 

amounts, 60% has been consolidated. 

5 EEG refers to the German subsidy mechanism for renewable energy, where the transmission system 

operator is required to pay the feed-in tariff to the producer of renewable energy and to sell that energy 

on the German energy exchange. The difference between the feed-in and sale price is offset via a 

monthly fee approved by the government. The entire mechanism is neutral in terms of net profit for 

50Hertz. 

6 The entire mechanism is usually neutral in terms of net profit for 50Hertz, except when a bonus is 

approved by the BNetzA for handling the EEG activities.

128 

4.3. Reconciliation of segments with total of group 

Consolidated results 2011 2011 2011 2011 

(in million €) - for the period ended 31 December 

Elia Transmission 

(Belgium) 


(Germany) 

Consolidation 

entries 

Elia Group 

Revenue 801.8 477.7 (1.1) 1,278.4 

Depreciation, amortization, impairment and 

changes in provisions (102.3) (38.6) 0.0 (140.9) 

REBITDA 354.0 94.9 0.0 448.9 

EBITDA 354.0 94.9 0.0 448.9 

Operating profit (REBIT) 251.7 56.3 0.0 308.0 

Operating profit, including non-recurring items 

(EBIT) 251.7 56.3 0.0 308.0 

Finance income 10.6 3.6 0.0 14.2 

Finance costs (128.2) (14.6) 0.0 (142.8) 

Income taxes (29.8) (13.5) 0.0 (43.3) 

Basic earnings, including non-recurring items, 


Basic earnings, excluding non-recurring items, 


BALANCE SHEET 

Total assets 4,473.8 1,370.3 (0.3) 5,843.8 

Capital expenditures 118.1 152.3 0.0 270.4 

Net financial debt 2,448.1 84.8 0.0 2,532.9 

The Group has no concentration of customers in neither of the operating segments. 

The 2010 figures include the 50Hertz Transmission (Germany) 

segment for the period from May to December, whereas the 

2011 figures consist of both segments for the full period, being 

January to December. 

5.1. Revenue 



5. Items of the consolidated income statement 

and other comprehensive income 

Detail revenue (in million €) 2011 2010 

Revenue 1,188.2 939.5 

Other income 90.2 98.0 

Total revenue and other income 1,278.4 1,037.5 

5.2. Other income 

The following table further details “Other income”, as indicated 

in Note 5.1 “Detail revenue”: 

(in million €) 2011 2010 

Own production 13.5 13.4 

Bonus previous year 1.5 0.0 

Optimal use of assets 13.1 11.6 

Services and technical expertise 7.8 5.7 

Changes in non-current assets related 

to application of IAS 19 4.6 (2.8) 

Transfers of assets from customers 18.6 14.4 

Subsidies and grants (1.2) 1.8 

Offshore revenue (horizontal) 10.5 4.0 

Revenue from penalty 0.0 3.7 

Belpex activities 0.0 2.9 

EEG bonus 2011 6.8 0.0 

Other 15.0 43.3 

Total other income 90.2 98.0

The other income, section Other, mainly consists of proceeds 

from sale of tangible assets, recoverable amounts of claims 

paid by insurance companies, etc. 

5.3. Operating expenses 

5.3.1. COST OF MATERIALS, SERVICES AND OTHER GOODS 


Purchase of ancillary services 414.2 267.3 

Raw materials, consumables and goods 

for resale 5.9 5.9 

Services and other goods (excl. purchase 

of ancillary services) 224.2 189.9 

Non-recurring services and other goods 0.0 8.0 

Total 644.3 471.1 

The “purchase of ancillary services” line includes the costs for 

services which enable the Group to balance generation with 

demand, to maintain voltage levels and to manage congestions 

on its grids. The increase compared to last year is mainly due to 

the 50Hertz network with exceptional weather conditions (very 

windy in December) and the decision of the German government 

to close eight nuclear power plants. These costs are recovered 

in future tariffs with a delay of two years. 

The “services and other goods” line is related to maintenance 

of the grid, services provided by third parties, insurance, consultancy, 

etc. 

The 2010 non-recurring services and other goods relate to one- 

off costs regarding the acquisition of 50Hertz in May 2010 

5.3.2. PERSONNEL EXPENSES 


Salaries and wages 113.9 94.1 

Social security contributions 28.5 26.8 

Pension costs 6.1 6.6 

Employee benefits (other than pensions) 6.5 2.5 

Share-based payment with reduction 0.0 0.1 

Other personnel expenses 3.4 3.8 

Total 158.4 133.9 

For more information regarding employee benefits, see Note 

6.12 Employee Benefits. 

5.3.3. DEPRECIATION, AMORTISATION, IMPAIRMENT 

AND CHANGES IN PROVISIONS 

(in million €) Note 2011 2010 

Depreciation of property, 

plant and equipment 6.1 131.2 113.6 

Depreciation of intangible assets 6.2 8.6 8.5 

Total of depreciation 139.8 122.1 

Impairment of inventories 

and trade receivables 0.4 1.0 

Total of impairment 0.4 1.0 

Provisions for litigation 6.13 1.1 2.7 

Environmental provisions 6.13 (0.3) 3.3 

Other provisions 6.13 (0.1) (1.7) 

Total of provisions 0.7 4.3 

Total 140.9 127.4 

A detailed description of provisions is provided in Note 6.13. 

The variance for impairment in respect of inventories and receivables 

during the year can be found in Note 7.3 “Financial 

risk and derivative management”. 

5.3.4. OTHER EXPENSES 




Taxes other than income tax 13.6 12.1 

Net loss on disposal/sale of property, 

plant and equipment 2.9 2.7 

Other 1.4 16.3 

Bonus-malus settlement of previous year 8.9 0.0 

Total 26.8 31.1 

The 2010 expenses classified as “Other” consisted mainly of 

a settlement of a claim of €11.4 million, which did not occur in 


5.4. Finance income and expenses 

129 



Interest income on investment trust, bank 

deposits, cash and cash equivalents 6.6 6.0 

Other financial income 7.6 15.8 

Finance costs 142.8 145.0 

Interest expense on eurobonds 

and other bank borrowings 131.0 120.0 

Interest expense on derivatives 11.4 13.4 

Other financial costs 0.4 11.6 

Net finance expense 

recognised in profit or loss (128.6) (123.2)

130 



The other financial income consists of the moratorium interests 

which are computed on the tax claim (we refer to Note 5.5 

below). The decrease in other financial income results from the 

sale of Elia’s stake in Belpex, which generated a gain of €8.4 

million. 

For more details on net debt and loans, see Note 6.11. 

5.5. Income taxes 

RECOGNISED IN PROFIT OR LOSS 

The consolidated income statement includes the following taxes: 


Current year 43.4 16.5 

Adjustments prior years 15.3 0.1 

Total income tax expenses 58.7 16.6 

Origination and reversal 

of temporary differences (15.4) 17.4 

Total deferred tax (15.4) 17.4 

Total income tax recognised 

in profit or loss 43.3 34.0 

RECONCILIATION OF THE EFFECTIVE TAX RATE 

The tax on the company’s profit (loss) before tax differs from 

the theoretical amount that would arise using the Belgian statutory 

tax rate applicable to profits (losses) of the consolidated 

companies as follows: 


Profit after tax 136.1 403.2 

Share of profit of equity accounted 

investees 1.4 (1.2) 


Income tax expenses 43.3 34.0 

Profit before tax 180.8 436.0 

Income tax using the domestic 

corporation tax rate 61.5 148.2 

Domestic corporate income tax 33.99% 33.99% 

Effect of the foreign tax rate (2.3) (14.6) 

Non-deductible expenses 1.8 1.9 

Gain on disposal of shares (0.5) (2.5) 

Other tax free income (0.1) (102.1) 

Adjustments prior years 0.0 0.1 

Tax incentives (notional interest deduction) (19.0) (16.9) 

Other 1.9 19.9 

Total income tax expenses 

in profit or loss 43.3 34.0 

The item ‘Gain on disposal of shares’ in 2010 is mainly related 

to the sale of the stake in Belpex to APX-ENDEX (see Note 7.2), 

and ‘Other tax-free income’ in 2010 includes the tax impact on 

the gain from bargain purchase, realised through the acquisition 

of 50Hertz (see Note 7.1). 

Elia received a tax assessment in early 2008 in view of taxation 

of the remaining tariff surpluses as at 31 December 2004. The 

income taxes paid total €93.8 million, including an administrative 

charge of 10% and an increase due to insufficient prepayments. 

Having consulted its tax advisor and CREG and given 

that similar tariff surpluses accounted for by other companies 

in the sector were not taxed, Elia management decided to file 

a complaint, but it was rejected by the tax authorities. By matter 

of consequence, Elia has filed a judicial claim for the full 

amount, including moratorium interest. 

In 2009, the tax authorities made a similar decision on the increase 

of tariff surpluses in 2005 and 2006. Elia received a 

tax assessment of €35.8 million, including an administrative 

charge of 10% and an increase due to insufficient prepayment, 

and decided to file a complaint about this in line with the case 

of 2004. 

The tariff surpluses that led to the additional assessment will be 

systematically settled in tariffs over the years to come (refund to 

consumers) in accordance with CREG decision, meaning that 

this solely is a matter of a timing difference between a surplus 

generated in the past and a refund in the subsequent years. 

If Elia’s complaint is rejected, the corporate income tax paid 

on the remaining surpluses will automatically be offset by ‘recoverable 

taxes’ on the refund given to consumers in 2005, 

2006 and 2007 and subsequent periods. In that way the basic 

amount of the corporate income tax can be recovered in full. 

If a balance is still outstanding, it will be settled using the tariff 

mechanism. 

On Friday 23 December, the Brussels Court of First Instance 

ruled in favour of Elia in its tax dispute 7 with the Belgian tax 

authorities. As a result of the ruling, the tax authorities must reimburse 

Elia €118.4 million, consisting of €80.2 million in taxes 

that were paid twice and which therefore must be reimbursed 

with 100% certainty, €5.1 million in prepayments, €8.5 million in 

administrative tax increase and €24.6 million in interest. However, 

the tax authorities lodged an appeal on 6 February 2012, 

thus suspending the ruling by the Court of First Instance. The 

Court of Appeal is not expected to rule on the case until 2014 

at the earliest. 

Deferred income taxes are discussed in Note 6.6 (‘Changes in 

deferred tax assets and liabilities resulting from movements in 

temporary differences during the financial year’). 

7 Elia’s tariffs are based on estimated income and costs as well as budgeted volumes. At the end of each 

tariff period, this results in tariff surpluses or deficits that must be factored into future tariffs. However, 

in 2008 the tax authorities ruled that tariff surpluses from the past (2003-2004) should be taxed 

immediately while Elia, in consultation with the regulator, considered this to be a debt in respect of future 

tariffs. All such tariff surpluses have actually been returned to consumers since the end of 2011.

5.6. Share in the results of associates 


H.G.R.T. 0.4 (1.3) 

APX-Endex 1.0 0.1 

Coreso 0.0 0.0 

Subtotal - associates 1.4 (1.2) 

Total 1.4 (1.2) 

The share in the results of joint ventures can be found in Note 

4.2 Segment 50Hertz Transmission (Germany). All companies 

related to the 50Hertz Transmission segment are joint ventures. 

There are no joint ventures in other segments. 

5.7. Basic earnings per share 

The basic earnings per share (EPS) are calculated by dividing 

the net profit attributable to the shareholders of the company 

(€137.5 million) by the weighted average number of ordinary 

shares outstanding during the year (60,355,217). 

WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES 

2011 2010 

Issued ordinary shares on 

1 st of January 60,355,217 48,270,255 

Impact of the shares issued 

in January 2010 - 12,045 

Impact of the shares issued 

in June 2010 - 6,267,657 

Weighted average number 

of shares on 31 st of December 60,355,217 54,549,957 

Diluted earnings per share 

Diluted earnings per share (EPS) is determined by adjusting 

the profit or loss attributable to ordinary shareholders and the 

weighted average number of ordinary shares outstanding for 

the effects of all dilutive potential ordinary shares, which comprise 

share options granted to employees. 

The diluted profit is equal to the ordinary profit per share, since 

there are no convertible bonds or share options. 

Share capital and reserves per share 

Share capital and reserves per share totalled €33.9 per share 

on 31 December 2011, compared with a value of €36.80 per 

share at the end of 2010. This decrease is due to the use of 

“weighted average number of shares” instead of “number of 

shares at reporting date” in the formula. 

5.8. Other comprehensive income 

Total comprehensive income includes both the result of the 

period recognised in the income statement and the other comprehensive 

income recognised in equity. Other comprehensive 

income includes all changes in equity other than owner-related 

changes, which are analysed in the statement of changes in 

equity. 

The following table analyses the deferred taxes and the changes 

in fair value booked in equity by item of other comprehensive 

income: 

INCOME TAXES RECOGNIZED 

IN OTHER COMPREHENSIVE INCOME 




Derivatives 1.3 1.0 

Actuarial gains (losses) 

on employee benefits 5.5 (8.8) 

Total 6.8 (7.8) 

RECOGNIZED IN OTHER COMPREHENSIVE INCOME 


Net changes in fair value of interest 

rate swaps 3.9 3.1 


Recognised in: 

Hedging reserve 3.9 3.1 

The hedging reserve is discussed in detail in Note 7.3. 

6. Items of the consolidated 

statement of financial position 

6.1. Property, plant and equipment 

131 


High-voltage substations 

and transformers 1,580.9 1,515.8 

Lines and cables 1,256.1 1,202.6 

Land on which substations, lines 

and cables are located 98.9 93.0 

Facilities used for network operation 142.1 130.7 

Administrative buildings, furnishings 

and vehicles 72.5 68.9 

Total property, plant 

and equipment 3,150.5 3,011.0

132 




ACQUISITION VALUE 

Land 

and 

buildings 

Machinery 

and 

equipment 

Furniture 

and 

vehicles 

Other 

tangible 

assets 

Assets 

under 

construction Total 

Balance at 1 January 2010 143.1 3,983.3 123.4 11.2 121.2 4,382.2 

Acquired by business combinations 48.0 703.1 9.9 0.0 86.9 847.9 

Other acquisition 5.5 70.6 3.4 0.1 113.6 193.2 

Disposals (3.1) (25.1) (14.7) 0.0 0.0 (42.9) 

Transfers from one heading to another 1.2 76.6 2.7 (2.4) (78.1) 0.0 

BALANCE AT 31 DECEMBER 2010 194.7 4,808.5 124.7 8.9 243.6 5,380.4 

Balance at 1 January 2011 194.7 4,808.5 124.7 8.9 243.6 5,380.4 

Other acquisition 7.5 83.5 7.7 0.2 183.8 282.7 

Disposals 0.0 (14.8) (2.2) 0.0 (7.8) (24.8) 

Transfers from one heading to another 0.6 121.9 0.9 2.0 (125.5) (0.1) 

Deconsolidation business combinations (0.2) (6.7) (0.8) 0.0 0.0 (7.7) 

BALANCE AT 31 DECEMBER 2011 202.6 4,992.4 130.3 11.1 294.1 5,630.5 

DEPRECIATION AND IMPAIRMENT 

Balance at 1 January 2010 (21.9) (2,144.8) (115.6) (10.1) 0.0 (2,292.5) 

Depreciation of the period (2.0) (107.0) (4.4) (0.2) 0.0 (113.6) 

Withdrawals and disposals 2.4 19.7 14.6 0.0 0.0 36.7 

Transfers from one heading to another 0.0 0.1 (3.0) 2.9 0.0 0.0 

BALANCE AT 31 DECEMBER 2010 (21.5) (2,232.0) (108.4) (7.4) 0.0 (2,369.4) 

Balance at 1 January 2011 (21.5) (2,232.0) (108.4) (7.4) 0.0 (2,369.4) 

Depreciation of the period (2.6) (123.0) (5.5) (0.5) 0.0 (131.6) 

Deconsolidation business combinations 0.1 5.3 0.8 0.0 0.0 6.2 

Withdrawals and disposals 0.0 12.5 2.2 0.0 0.0 14.7 

Transfers from one heading to another (0.1) 2.0 0.0 (1.8) 0.0 0.1 

BALANCE AT 31 DECEMBER 2011 (24.1) (2,335.2) (110.9) (9.7) 0.0 (2,480.0) 

CARRYING AMOUNT 

At 1 January 2010 121.2 1,838.5 7.8 1.1 121.2 2,089.7 

At 31 December 2010 173.1 2,576.5 16.2 1.4 243.6 3,011.0 

At 1 January 2011 173.1 2,576.5 16.2 1.4 243.6 3,011.0 

At 31 December 2011 178.5 2,657.3 19.3 1.4 294.1 3,150.5 

The most important projects in Belgium are the upgrading and/ 

or extension of substations (Bruegel-380 kv / Seraing-220 kv 

/ Bruges-150 kv / Ruien-150 kv / Monceau-150 kv / Schaarbeek-150 

kv / Zurenborg-150 kv / Wijgmaal-150 kv / Machelen-150 

kv and Gouy-150 kv), the construction of overhead lines 

(Harmignies-Monceau 70 kv and Tihange-Gramme 150 kv) and 

the construction of underground cables (Basse-Wavre-Louvain 

36 kv / Zeebrugge-Blauwe Toren 150 kv / Brecht-Rijkevorsel 

150 kv and Mechelen-Muizen 70 kv). 

The most important onshore projects in Germany relate to the 

“South-West-Coupling-Line”, the “Uckermark Line”, the extension 

of substation Wolmirstedt (€15,7 million), investments in 

the new transmission control center and the construction of a 

new 380/110 kv substation in North Freiberg. 

The offshore capital expenditure in Germany includes the connection 

with the offshore wind farms, Baltic I and Baltic II, in 

the Baltic Sea.

Application of the IAS 23 Borrowing Costs standard had an impact 

of €5.3 million on the 2011 acquisition of the assets using 

an average interest rate of 4.22% 

6.2. Intangible assets 

(in million €) Goodwill Software 

ACQUISITION VALUE 

Other liabilities relating to new investments are described in 

Note 7.4. 

Licences/ 

Concessions Total 

Balance at 1 January 2010 1,707.8 37.7 1.1 1,746.6 

Obtained by business combinations 0.0 1.7 17.8 19.5 

Acquired, others - own construction capitalised 0.0 8.3 2.6 10.9 

Deconsolidation business combinations 0.0 (2.7) 0.0 (2.7) 

BALANCE AT 31 DECEMBER 2010 1,707.8 45.0 21.5 1,774.3 

Balance at 1 January 2011 1,707.8 45.0 21.5 1,774.3 

Acquired, others - own construction capitalised 0.0 10.9 0.2 11.1 

BALANCE AT 31 DECEMBER 2011 1,707.8 55.9 21.7 1,785.4 

DEPRECIATION AND IMPAIRMENT 

Balance at 1 January 2010 0.0 (16.2) (0.3) (16.5) 

Deconsolidation business combinations 0.0 1.4 0.0 1.4 

Depreciations 0.0 (7.2) (0.9) (8.1) 

BALANCE AT 31 DECEMBER 2010 0.0 (22.0) (1.2) (23.2) 

Balance at 1 January 2011 0.0 (22.0) (1.2) (23.2) 

Depreciations 0.0 (7.4) (1.2) (8.6) 

BALANCE AT 31 DECEMBER 2011 0.0 (29.4) (2.4) (31.8) 

CARRYING AMOUNT 

At 1 January 2010 1,707.8 21.5 0.8 1,730.1 

At 31 December 2010 1,707.8 23.0 20.3 1,751.1 

At 1 January 2011 1,707.8 23.0 20.3 1,751.1 

At 31 December 2011 1,707.8 26.4 19.4 1,753.6 

Software comprises both IT applications developed by the 

company for operating the grid and software for the Group’s 

normal business operations. 

See Note 5.3.3 for the impact of depreciations in intangible assets 

on profit or loss. 



133 

The goodwill, amounting to €1,707.8 million, relates to the following 

past transactions: 


Acquisition of participations in Elia 

Asset by Elia System Operator - 2002 1,700.1 1,700.1 

Acquisition of participations in Elia 

Engineering by Elia Asset - 2004 7.7 7.7 

Total 1,707.8 1,707.8

134 



IMPAIRMENT TEST FOR CASH-GENERATING UNIT ELIA 

TRANSMISSION (BELGIUM) CONTAINING GOODWILL 

In 2002, the acquisition of Elia Asset by the company for an 

amount of EUR 3,304.1 million resulted in a positive consolidation 

difference of €1,700.1 million. This positive consolidation 

difference is the result of the difference between acquisition 

value of this economic entity and carrying amount of the assets 

of Elia Asset. This difference consists of different elements such 

as the fact that (i) Elia was appointed as a TSO for a period of 

20 years, (ii) Elia has unique resources in Belgium as Elia is the 

owner of the whole very-high-voltage network and is the owner 

of (or has the right to use) 94% of the high-voltage network, 

and hence only Elia is entitled to propose a development plan, 

and (iii) Elia has the TSO know-how. At the date of acquisition, 

the qualification or the quantification in euro of these elements 

could not be performed on an objective, transparent and reliable 

basis and therefore, the difference could not be allocated 

to specific assets and was considered unallocated. Therefore, 

this difference has been recognised as goodwill since the first 

adoption of IFRS at 1 January 2005. The regulatory framework, 

in particular the offsetting in the tariffs of the decommissioning 

of fixed assets, applicable as from 2008 onwards, did not have 

an impact on this accounting treatment. 

The goodwill, as described above and the goodwill resulting 

from the acquisition of Elia Engineering in 2004 were allocated 

to the single cash-generating unit for the impairment test determined, 

since the income and expenses were generated by one 

activity, specifically the ’regulated activity in Belgium’, which will 

also be considered as one cash-generating unit. As a result, 

the company assigned the carrying amount of the goodwill to 

one unit, the regulated activity in Belgium. Since 2004, annual 

impairment tests have been conducted and did not result in 

recognition of any impairment losses. Cash-generating units to 

which goodwill has been allocated are tested for impairment at 

least annually as the higher of their fair value less cost to sell or 

value in use, applying the assumptions hereafter and using the 

following valuation methods. 

The impairment test was conducted by an independent expert 

and was based on the following valuation methods and applying 

the following assumptions (according to fair value less cost 

to sell methodology): 

1. discounting of future cash flows and using the “Regulated 

Asset Base” or “RAB” as the basis for the estimation of the 

terminal value; 

2. discounting of future dividends; 

3. comparison between the previously mentioned impairment 

methods and those used by some comparable West 

European listed companies, such as Red Electrica España, 

Enagas, Terna, Snam Rete Gas, National Grid and 

Fluxys; 

4. market valuation based on the company’s share price. 

The future cash flows and future dividend methods are based 

on Elia’s 2010-2020 business plan. 

The key assumptions used for this valuation are 

• risk-free rate of 4.66%, based on Belgian 10-year bond rates; 

• cost of debt of 5.20%; 

• tax rate of 33.99%; 

• market risk premium of 6.00%; 

• perpetual growth rate of 1.25%. 

The independent analyses did not result in recognizing an 

impairment loss on goodwill in 2011. Based on current knowledge, 

reasonable changes in key assumptions (including discount 

rate and OLO) would not generate material impairments 

for the cash-generating unit Elia Transmission (Belgium). 

6.3. Non-current trade and other 

receivables 


Tax receivables 118.4 111.9 

Other amounts receivable 1.8 2.8 

Total 120.2 114.7 

Long-term receivables consist of the basic amount of tax receivable 

(€93.8 million) and the cumulative moratorium interest 

that the company could recover in the future. A detailed description 

can be found in Note 5.5. 

6.4. Equity-accounted investees 

INVESTMENTS IN ASSOCIATED COMPANIES 


At 1 January 29.2 9.4 

Acquisition of subsidiary 0.0 21.1 

Sale of subsidiary 0.0 (0.1) 

Share of (loss)/profit 1.4 (1.2) 

At 31 December 30.6 29.2

Summary of financial data on equity-accounted investees, not corrected for the group’s ownership percentage: 

Name Assets Liabilities Revenues Profit/(loss) Interest held % 

2010 

H.G.R.T. 31.8 0.1 0.0 2.6 24.5 

APX-Endex 937.0 902.7 30.7 2.7 20.0 

Coreso 2.8 1.5 3.5 0.1 28.5 

TOTAL 971.6 904.3 34.2 5.4 - 


H.G.R.T. 33.3 0.1 0.0 2.6 24.5 

APX-Endex 915.4 876.1 34.7 4.5 20.0 

Coreso 2.8 1.4 4.8 0.1 28.5 

TOTAL 951.5 877.6 39.5 7.2 - 

The summary of financial data of joint ventures can be found in Note 4.2 Segment 50Hertz Transmission (Germany). All companies 

related to the 50Hertz Transmission segment are joint ventures. There are no joint ventures in other segments. 

6.5. Other financial assets 


Immediately claimable deposits 13.6 13.4 

Others 71.3 66.1 

Total 84.9 79.5 

6.6. Deferred tax assets and liabilities 

RECOGNISED DEFERRED TAX ASSETS AND LIABILITIES 



‘Immediately claimable deposits’ classified at fair value for 

which the changes in fair value are recognised in OCI. The risk 

profile of these investments is discussed in Note 7.3. 

The item ‘Others’ is mainly related to a recoverable amount of 

a portion of the pension liability - see Note 6.12. 

(in million €) Assets Liabilities 

2011 2010 2011 2010 

Property, plant and equipment (7.6) (2.9) (63.4) (61.1) 

Intangible fixed assets (8.2) (7.4) 0.0 0.0 

Inventories (0.9) (1.1) 0.0 0.0 

Interest-bearing loans and other non-current financial liabilities 11.4 9.8 0.0 0.0 

Employee benefits 34.2 32.5 1.1 0.9 

Provisions 0.1 0.1 2.0 (2.1) 

Accrued charges and deferred income 0.0 0.0 (0.3) 0.0 

Other items (23.8) (22.3) (7.0) (31.0) 

Net tax asset / (liability) 5.2 8.7 (67.6) (93.3) 

135

136 

CHANGES IN DEFERRED TAX ASSETS AND LIABILITIES RESULTING FROM MOVEMENTS 

IN TEMPORARY DIFFERENCES DURING THE FINANCIAL YEAR 

(in million €) 1 january 

2010 

Recognised 

in income 

statement 

Recognised 

in other 

comprehensive 

income 

Acquired 

by business 

combinations 31 december 

Tangible fixed assets 0.5 (9.6) 0.0 (55.0) (64.1) 

Intangible fixed assets (7.1) (0.3) 0.0 0.0 (7.4) 

Other financial assets 0.0 0.0 0.0 0.0 0.0 

Inventories (1.0) (0.1) 0.0 0.0 (1.1) 

Interest bearing loans and other long term 

financial liabilities 8.6 0.2 1.1 0.0 9.9 

Employee benefits 47.7 (6.3) (8.9) 0.8 33.3 

Provisions 0.1 (0.6) 0.0 (1.5) (2.0) 

Other items (30.6) (0.7) 0.0 (21.9) (53.2) 

TOTAL 18.2 (17.4) (7.8) (77.6) (84.6) 




Tangible fixed assets (64.1) (7.1) 0.0 0.0 (71.1) 

Intangible fixed assets (7.4) (0.7) 0.0 0.0 (8.2) 

Inventories (1.1) 0.2 0.0 0.0 (0.9) 

Interest bearing loans and other long term 

financial liabilities 9.9 0.2 1.3 0.0 11.4 

Employee benefits 33.3 (3.5) 5.5 0.0 35.3 

Provisions (2.0) 4.1 0.0 0.0 2.1 

Accruals and deferred income 0.0 (0.2) 0.0 0.0 (0.2) 

Other items (53.2) 22.4 0.0 0.0 (30.8) 

TOTAL (84.6) 15.4 6.8 0.0 (62.4) 

EFFECT OF CHANGES IN TEMPORARY DIFFERENCES 

DURING THE FINANCIAL YEAR 

Changes in temporary differences during the year are reflected 

in profit or loss as income tax expense (also see Note 5.5). 

UNRECOGNISED DEFERRED TAX ASSETS 

For the following items no deferred income taxes are recognised 

in the balance sheet: 


Notional interest deduction 122.8 122.3 

Not recognised 

tax asset / (liability) 122.8 122.3 

The Belgian government has announced late 2011 that the system 

of notional interest deduction will undergo some changes. 

The amount that was not used from the past remains recoverable 

from future tax profits. The new rules regarding the method 

of release for a given year haven’t been finalized. Therefore the 

Group has opted not to recognize the deferred tax asset consistent 

with last year. 

The Group profit or loss account reserve includes €44.6 million 

of distributable reserves retained by subsidiaries and equityaccounted 

entities, intended to be distributed as dividend to 

the Group in the future. 

6.7. Inventories 


Raw materials and consumables 28.2 25.9 

Write-off (11.9) (11.4) 

Total 16.3 14.5 

The warehouse primarily stores replacement and spare parts 

for maintenance and repair work on the Group’s high-voltage 

substations, overhead lines and underground cables.

6.8. Current trade and other receivables 


Projects for third parties 4.4 4.0 

Other trade receivables and advance 

payments 196.2 287.2 

Levies 16.2 0.0 

VAT, other taxes 40.4 125.2 

Other 24.4 97.3 

Deferred charges and accrued income 5.2 9.4 

Total 286.8 523.1 

The decrease compared to last year is mainly due to decrease 

in outstanding customers and the decrease in VAT. The item 

‘Other’ consists of EEG related items. 

The Group’s exposure to credit and currency risks, and impairment 

losses related to trade and other receivables, are shown 

in Note 7.3. 

DOUBTFUL AMOUNTS 


Not past due 184.7 254.0 

Past due 0-30 days 8.9 11.9 

Past due 31-60 days 0.8 (5.8) 

Past due 61 - one year 2.3 26.1 

More than one year (0.7) 0.7 

Total (excl. Impairment) 196.0 286.9 

Doubtful amounts 21.9 15.2 

Amounts write offs (21.7) (14.9) 

Total 196.2 287.2 

6.9. Cash and cash equivalents 


Balance at bank 34.4 128.7 

Call deposits 351.2 237.2 

Total 385.6 365.9 

Short-term deposits are invested for periods that vary from a 

few days and a few weeks to several months, depending on 

immediate cash requirements, and report interest in accordance 

with the interest rates for the short-term deposits. The 

interest rate of interest-bearing investments at the end of the 

reporting period varies from 0.15% to 2.00%. An amount of 

€6 million is limited in use as result of contractual conditions 

related to a subsidy granted by the European community. 

Bank-account balances earn interest in line with the variable 

rates of interest on the basis of daily bank deposit interest. The 

Group’s interest rate risk and the sensitivity analysis for financial 

assets and liabilities are discussed in Note 7.3. 

6.10. Shareholders’ equity 

SHARE CAPITAL AND SHARE PREMIUM 



Number of shares Ordinary shares 


137 

Outstanding on 1January 60,355,217 48,270,255 

Issued against cash payment 0 12,084,962 

Outstanding on 

31 December - paid 60,355,217 60,355,217 

In January 2010 the Elia Group gave its personnel the opportunity 

to subscribe to an Elia System Operator SA capital increase 

(tax tranche) which resulted in a €0.3 million increase in 

the share capital and the number of shares outstanding rose by 

13,919 shares without nominal value. 

Elia launched a second capital increase for a nominal amount 

of €299.4 million, between 8 and 18 June 2010, with a view to financing 

the acquisition of a 60% stake in German grid operator 

50Hertz Transmission, which was fully subscribed. During the 

subscription period with preferential rights for existing shareholders, 

whereby for every four preferential rights they could 

take up one new share at a price of €24.80, 91.84% of the 

shares available (11,085,617 of the 12,071,043 new shares on 

offer) were subscribed. On 22 June 2010, the other 3,941,704 

rights were offered to institutional investors in a private placement. 

All remaining preferential rights were sold as scrips for 

€0.20 per scrip, bringing the share purchase price to €25.60. 

The new shares were listed for the first time on 25 June 2010. 

The capital of Elia System Operator SA increased from €1,207.3 

million to €1,500.6 million in 2010 taking into account the costs 

for capital increases. 

RESERVES 

In accordance with Belgian legislation, 5% of the parent company’s 

statutory net profit must be transferred to the legal reserve 

each year until the legal reserve represents 10% of the 

capital. 

Within the tariff mechanism, Elia must reserve in shareholders’ 

equity the realised surplus passed on in the tariffs as a result 

of decommissioning fixed assets (decrease in Regulated Asset 

Base). 

In 2010, this amounted to €16.2 million. The General Meeting 

of 10 May 2011 decided to include that amount in the legal 

reserve.

138 



As per 31 December 2011 the Group’s legal reserve amounts 

to €67.6 million. This reserve can only be paid to shareholders 

in the event of liquidation. 

The Board of Directors can propose the payment of a dividend 

to shareholders up to a maximum of the available reserves and 

the profit carried forward from previous financial years of the 

parent company, including the profit of the financial year ended 

31 December 2011. Shareholders must approve the dividend 

payment at the Annual General Meeting of Shareholders. 

HEDGING RESERVE 

The hedging reserve comprises the effective portion of the 

cumulative net change in fair value of cash-flow hedging instruments 

in respect of hedged transactions that have not yet 

occurred. 

DIVIDEND 

After the balance sheet date, the Board of Directors put forward 

the dividend proposal indicated below. 

(in €) 2011 2010 

Per ordinary share entitled to dividend 1.47 1.40 

At the General Meeting of Shareholders on 10 May 2011, the 

Board of Directors approved payment of a gross dividend of 

€1.40 per share, which will yield a net dividend of €1.05 per 

share or a net dividend of €1.19 per share with a VVPR strip, 

yielding a total amount of €84.5 million. 

The Board of Directors’ meeting of 28 February 2012 proposed 

a gross dividend of €1.47 per share. This dividend is subject to 

approval by shareholders at the Annual General Meeting on 15 

May 2012 and was not included as a liability in the consolidated 

financial statements of the Group. 

The total dividend will be calculated on the number of shares 

outstanding on 28 February 2012 which correspond to a total 

of €88.7 million. 

The net profit includes also the realised surplus as a result of 

decommissioning of fixed assets of €16.1 million to be booked 

in equity. The Board of Directors’ meeting of 28 February 2012 

decided to suggest to the Annual General Meeting that this 

amount be allocated to the legal reserve. The amount has not 

yet been posted in the reserve on 31 December 2011. 

6.11. Interest-bearing loans and borrowings 

A general overview of loans and accrued interest is given below: 


Long term borrowings 2,850.2 2,848.9 

Accrued Interests 68.3 68.4 

Subtotal non-current borrowings 2,918.5 2,917.3 

Short term borrowings 0.0 0.1 

Accrued Interests 0.0 0.0 

Subtotal current borrowings 0.0 0.1 

Total 2,918.5 2,917.4 

Information concerning the terms and conditions of the outstanding interest-bearing loans and borrowings is given below: 

(in million €) Maturity Amount 

Interest 

rate before 

hedging 

Interest 

rate after 

hedging 

Current 

proportion of 

the interest (%) 

% % Fixed Variable 

Shareholders Loan tranche A 2022 495.8 2.76 4.99 79.83 20.17 

Eurobond issues 2004 / 10 years 2014 499.4 4.75 4.75 100.00 0.00 





European Investment Bank 2016 40.0 4.27 4.27 100.00 0.00 

European Investment Bank 2017 20.0 4.79 4.79 100.00 0.00 

TOTAL - 2,850.2 - - 96.72 3.28

Information concerning the contractual maturities of the 

Group’s interest-bearing loans and borrowings (current and 

non-current) is given below: 


Shareholders Loan 

tranche A 

Face 

value 

Less 

than 1 

year 

1-2 

years 

3-5 

years 

More 

than 5 

years 

495.8 0.0 0.0 0.0 495.8 

Eurobond issues 2,300.0 0.0 500.0 1,000.0 800.0 

European 

Investment Bank 

European 

Investment Bank 

40.0 0.0 0.0 40.0 0.0 

20.0 0.0 0.0 20.0 0.0 

Total 2,855.8 0.0 500.0 1,060.0 1,295.8 

6.12. Employee benefits 

In Belgium collective agreements regulate the rights of company 

employees in the electricity and gas industries. 

These agreements provides so called “pension supplements” 

based on the annual salary and the career within the company 

of the employee. If the employee deceases, the supplements 

are partially revertible to the heritor (wife/orphan). The benefits 

granted are linked to Elia’s operating result. There is neither an 

external pension fund nor group insurance for these liabilities, 

which means that no reserves are constituted with third parties. 

The obligations are qualified as a defined benefit. 

The collective agreement determines that active staff hired 

from 1 January 1993 to 31 December 2001 and all managerial/ 

executive staff hired prior to 1 May 1999 are granted the same 

guarantees via a defined-benefit pension scheme. Obligations 

under these defined-benefit pension plans are funded through 

a number of pension funds for the electricity and gas industries 

and through insurance companies. 

‘Salary scale’ personnel recruited after 1 June 2002 and management 

staff recruited after 1 May 1999 are covered by defined-contribution 

pension plans. For payments made after 1 

January 2004, the law requires an average annual return over 

the career of at least 3.25% for the employer’s contributions 

and at least 3.75% for employees’ contributions, with any deficit 

being covered by the employer. Given that the actual return 

on plan assets has been above the guaranteed minimum return, 

no provision has been established to cover any deficit. 

Elia Transmission Belgium also has early-retirement schemes 

and other post-employment benefits such as reimbursement 

of medical expenses and price subsidies, as well as other longterm 

benefits (seniority payments). Not all of these benefits are 

funded. 



139 

50Hertz Transmission (Germany) has pension schemes and 

early-retirement plans, mainly based on collective bargaining 

or works council agreements. The level of benefits or contribution 

to be provided depends on the salary and years of service 

of the participants. 

The total net liability for employee benefits obligations are as 

follows: 


Defined benefit plans 53.7 52.6 

Other employee benefits 53.8 50.2 

Subtotal 107.5 102.8 

Others (restructuring) 0.6 1.0 

Total provisions for employee benefits 108.1 103.8

140 

In following tables the detail is shown of the outstanding provision for employee benefits, with the split between pension cost and 

non-pension costs. In this annual report the same split has been made for the 2010 figures. In last year’s annual report this split 

was not yet disclosed. 

DEFINED BENEFIT PLAN FOR COMPLEMENTARY PENSIONS 


MOVEMENT IN THE PRESENT VALUE OF THE DEFINED BENEFIT OBLIGATIONS 

Defined benefit obligation at the beginning of the period (172,3) (180,3) 

Acquired by business combinations 0,0 (11,9) 

Service Cost (4,3) (4,0) 

Interest Cost (7,4) (7,5) 

Contributions from plan participants (0,5) (0,6) 

Gains (losses) on changes of plans 0,0 0,0 

Gains (losses) on curtailments or settlements of plans 0,0 0,0 

Special termination benefits 0,0 0,0 

Actuarial gains (losses) (7,6) 17,0 

Benefits paid 15,0 14,9 

DEFINED BENEFIT OBLIGATION AT THE END OF THE PERIOD (177,1) (172,3) 

MOVEMENT IN THE FAIR VALUE OF PLAN ASSETS 

Fair value of plan assets at beginning of the period 119,7 94,4 

Acquired by business combinations 0,0 7,1 

Expected (not actual) return on plan assets 5,6 5,1 

Company contributions 17,5 19,5 

Plan participants contributions 1,0 1,0 

Gains (losses) on curtailments or settlements 0,0 0,0 


Benefits paid (14,9) (14,8) 

FAIR VALUE OF PLAN ASSETS AT END OF PERIOD 123,4 119,7 

FUNDED STATUS 



FUNDED STATUS OF THE PLAN (53.7) (52.6) 

EXPENSE RECOGNISED IN PROFIT OR LOSS 



Plan participants contributions (0,1) (0,1) 

Expected return on plan assets 5,6 5,1 

Actuarial gains (losses) 0,0 0,1 


Special termination benefits 0,0 0,0 

TOTAL NET PERIODIC BENEFIT COST (6,2) (6,4)

POST-EMPLOYMENT BENEFITS OTHER THAN PENSIONS 


MOVEMENT IN THE PRESENT VALUE OF THE DEFINED BENEFIT OBLIGATIONS 

Defined benefit obligation at the beginning of the period (54,8) (56,7) 

Acquired by business combinations 0,0 (5,0) 



Contributions from plan participants 0,0 0,0 


Gains (losses) on curtailments or settlements of plans 0,0 0,0 

Special termination benefits (1,9) 1,5 


Benefits paid 4,7 4,4 

DEFINED BENEFIT OBLIGATION AT THE END OF THE PERIOD (60,2) (54,8) 

MOVEMENT IN THE FAIR VALUE OF PLAN ASSETS 

Fair value of plan assets at beginning of the period 4,6 0,8 

Acquired by business combinations 0,0 3,4 

Expected (not actual) return on plan assets 0,0 0,0 

Company contributions 4,6 4,1 



Actuarial gains (losses) (0,3) (0,1) 

Benefits paid (3,4) (3,8) 

FAIR VALUE OF PLAN ASSETS AT END OF PERIOD 6,4 4,6 

FUNDED STATUS 

FUNDED STATUS OF THE PLAN (53,8) (50,2) 

EXPENSE RECOGNISED IN PROFIT OR LOSS 






Expected return on plan assets 0,0 0,0 



Special termination benefits (1,9) 1,5 


TOTAL NET PERIODIC BENEFIT COST (6,5) (2,7) 

141

142 

ACTUARIAL ASSUMPTIONS 

Pension plans (%) 2011 2010 

Elia Transmission (Belgium) 

Inflation rate 2.00 2.00 

Discount rate at 31 December 

(not including inflation) 2.00 2.36 

Future salary increases 


Expected return on plan assets 


Future pension increases 


Medical cost trend rate 1.00 1.00 

50Hz Transmission (Germany) 

Inflation rate 2.50 1.75 

Discount rate at 31 December 


Future salary increases 


Expected return on plan assets 


Future pension increases 

(not including inflation) 

1.00 / 2.50 / 

3.00 / p.a. 

1.00 / 1.75 / 

2.00 / p.a. 

Medical cost trend rate n/a n/a 

The expected return on plan assets is determined by asset category, 

with each asset category having its own estimated rate 

of return. 

SENSITIVITY ANALYSIS 

The impact of a change of 1% on medical costs is as follows: 




Increase 

of 1% 

Decrease 

of 1% 

Aggregate of the service 

and interest costs (0.2) 0.2 

Defined benefit obligation (2.9) 2.3 

The impact of increase of 1% on discount rate and inflation 

medical costs is as follows: 

(in million €) Discount rate Inflation 

Defined benefit obligation 16.8 (17.4) 

DETAILED SUMMARY OF PLAN ASSETS 

(%) 2011 2010 

Equity securities 23.28 23.78 

Bonds 55.90 54.34 

Property 5.37 5.54 

Other (cash included) 15.45 16.34 

Total plan assets 100.00 100.00 

ACTUARIAL GAINS AND LOSSES RECOGNISED 

IN OTHER COMPREHENSIVE INCOME 


Cumulative amount at 1 January 10.4 (15.7) 

Recognised in the period (10.8) 26.1 

Cumulative amount at 31 December (0.4) 10.4 

The following table presents the historical overview of the key 

indicators of the last five years : 

(in million €) 2011 2010 2009 2008 2007 

Defined 

benefit obligation (237.4) (228.4) (236.9) (240.0) (258.9) 

Fair value 

of plan assets 128.7 124.3 95.2 98.5 116.9 

(Surplus) / Deficit (108.7) (104.1) (141.7) (141.5) (142.0) 

Recoverable amount in future tariffs 

In accordance with a study report issued by the CREG, it is 

virtually certain that some of the liability related to the pension 

scheme total of €70.1 million will be accepted by the CREG as 

reasonable expenses and will therefore be passed on in future 

tariffs. Since this amount can be recovered by Elia from third 

parties, in accordance with IFRS principles (IAS 19), it will be 

classified as an asset item. The amount is included under other 

financial assets (see Note 6.5).

6.13. Provisions 

(in million €) Environment Litigation 

Rights use 

of lines Total 

BALANCE AT 1 JANUARY 2010 13.9 4.8 0.0 18.7 

Acquired by business combinations 2.1 8.3 39.8 50.2 

During financial year: increase in provisions 3.8 20.4 1.5 25.7 

During financial year: utilization provisions (0.4) (2.2) (0.4) (3.0) 

During financial year: reversals of provisions 0.0 (3.4) 0.0 (3.4) 

BALANCE AT 31 DECEMBER 2010 19.4 27.9 40.9 88.2 

Long-term portion 1.9 7.3 35.4 44.6 

Short-term portion 17.5 20.6 5.5 43.6 

BALANCE AT 1 JANUARY 2011 19.4 27.9 40.9 88.2 

During financial year: increase in provisions 1.7 4.8 2.7 9.2 

During financial year: utilization provisions (1.8) (0.3) (2.1) (4.2) 

During financial year: reversals of provisions (0.3) (14.8) 0.0 (15.1) 

BALANCE AT 31 DECEMBER 2011 19.0 17.6 41.5 78.1 

Long-term portion 7.7 9.5 36.5 53.7 

Short-term portion 11.3 8.2 4.9 24.4 

The changes in provisions for environment are mainly related 

to further soil research and remediation on certain sites in Flanders 

and to the results of the preventive screening and detailed 

analysis of sites in the Brussels-Capital Region and the Walloon 

Region. The estimates are based on the appraisal of an 

external expert bearing in mind the BATNEEC (Best Available 

Techniques Not Entailing Excessive Costs) principle. 

The provision for litigation has been established to cover potential 

payment as a result of cases in which legal proceedings 

have been instituted against Elia by a third party or in which Elia 

is involved in a legal dispute. 

The provision ‘Rights of use of land’ consists of potential payment 

to landowners for easement rights related to overhead 

lines built in the past by the former owners of 50Hertz Transmission. 

These estimates are based on the value of claims filed or on the 

estimated amount of the risk exposure. 

The expected timing of the related cash outflow depends on 

the progress and duration of the associated procedures. 

The changes in provisions are discussed in Note 5.3.3. 

6.14. Other non-current liabilities 


Investments grants 8.1 7.0 

Other 12.3 13.6 

Total 20.4 20.6 

6.15. Trade and other payables 

TRADE AND OTHER PAYABLES 



143 


Trade debts 223.1 298.1 

VAT, other taxes 4.5 12.7 

Remuneration and social security 24.3 24.3 

Dividend 3.3 3.1 

Levies 79.4 75.3 

Other 31.5 35.2 

Total 366.1 448.7 

The decrease is mainly related to the decrease of ‘unpaid invoices 

to suppliers’.

144 



6.16. Accruals and deferred income 


Accruals and deferred income 89.9 61.1 

Balance settlement mechanism Belgium 15.2 49.9 

Balance settlement mechanism Germany 71.7 68.3 

Total other current liabilities 176.8 179.3 

The following table presents overview of 2011 

(in million €) Belgium Germany 

To be refunded to the tariffs 

of current period 0.0 9.1 

Balance period prior years 

to be refunded into the tariffs 

- period to be determined (9.4) 62.6 

Discount future tariffs (9.4) 71.7 

Moratorium interest on income tax 24.6 0.0 

Balance settlement mechanism 15.2 71.7 

7. Miscellaneous 

7.1. Effect of new acquisition 

ACQUISITION OF 10% OF ATLANTIC GRID IN 2011 

Description of the deal 

On 22 July 2011, Eurogrid International, in which Elia has a 60% 

stake, joined partners Google, Marubeni, Good Energies and 

Atlantic Grid Investments (AGI) in the Atlantic Wind Connection 

project. Atlantic Wind Connection aims to develop the first 

high-voltage DC offshore grid in the USA, which should make 

it possible to integrate up to 7,000 MW of offshore wind power 

into the grids of New Jersey, Delaware, Maryland and Virginia. 

Eurogrid International acquired a strategic minority stake of 

10% in the first segment of the project and a minority stake of 

5% in the four other segments. Eurogrid International acquired 

the participation via its newly established, wholly owned subsidiary 

E-Offshore A LLC. Elia’s stake was €1.2 million (part in 

consolidated figures 60% or €0.8mio). 

Contribution to the result of the Group 

Eurogrid International holds through its subsidiaries a stake of 

10% in Atlantic Grid A. 

ACQUISITION OF 50HERTZ TRANSMISSION IN 2010 

Effect of acquisition in 2011 

In 2011 no further modifications are needed for the 2010 PPA. 

Description of the deal 

On 12 March 2010, Elia and IFM announced the acquisition of 

50Hertz from the Vattenfall Group. This was completed on 19 

May 2010. 

It comprised all shares held by 50Hertz Transmission, including 

the wholly owned subsidiary 50Hertz Offshore and its two 

minority shareholdings EMCC (20.0%) and CAO (12.5%). 

With a view to this acquisition, Elia and IFM set up the holding 

company Eurogrid International SCRL/CVBA. In total, 60% of 

Eurogrid International’s shares are owned by Elia System Operator 

NV/SA and Elia Asset NV/SA (the latter holding a single 

share), and 40% of them are held by IFM Luxembourg. 

The shares held by 50Hertz Transmission were acquired via 

Eurogrid GmbH, a private German limited-liability company established 

on 2 March 2010. Eurogrid GmbH is a wholly owned 

subsidiary of Eurogrid International. 

The acquisition price for all shares held by 50Hertz was 

€464.6 million. Via Eurogrid GmbH, Elia paid €278.8 million for 

a 60% stake. 

Following the shareholders’ agreement with IFM, the 50Hertz 

figures are included in the Elia figures at a rate of 60% using the 

proportionate consolidation method.

Total (in million €) 

Pre-acquisition 

carrying amounts 

Fair value 

adjustments 

Recognised values 

on acquisition 

Intangible assets 32.4 0.0 32.4 

Property, plant and equipment 1,413.8 (8.6) 1,405.2 

Other financial assets 0.3 0.0 0.3 

Inventories 2.9 0.0 2.9 

Trade and other receivables 222.6 0.0 222.6 

Deferred tax assets 0.0 2.5 2.5 

Cash and cash equivalents 0.0 0.0 0.0 

Other current assets 88.2 0.0 88.2 

Employee benefits (10.8) 0.0 (10.8) 

Provisions (84.0) 0.0 (84.0) 

Loans and borrowings 0.0 0.0 0.0 

Trade and other payables (402.6) 0.0 (402.6) 

Deferred tax liabilities (131.8) 0.0 (131.8) 

Other current liabilities (182.8) 0.0 (182.8) 

Net identifiable assets 948.2 (6.1) 942.1 

Gain on bargain purchase - - (477.5) 

Consideration paid - - 464.6 

Cash acquired - - 0.0 

NEW BUSINESS COMBINATION - - 464.6 

Gain on bargain purchase (2010) 

Owing to the acquisition of 50Hertz Transmission, the corresponding 

purchase price has to be recorded in the financial 

statement. 

Under IFRS an allocation of acquired goodwill or a gain on 

bargain purchase needs to be made by executing a Purchase 

Price Allocation or ‘PPA’. In a PPA, all separately identifiable 

assets and (contingent) liabilities are measured at fair value. 

This PPA exercise was carried out for Eurogrid GmbH (German 

financing and acquisition structure above 50Hertz Transmission), 

whereby the value of the equity of 50Hertz was determined 

to €942,1 million, and finally resulted in a gain on bargain 

purchase of €477.5 million of which 60% is reflected in the income 

statement of the Group. 

Gain on bargain purchase (in million €) 100% 60% 

Parent's company value of investment (1) 464.6 278.8 

Equity 50Hertz per 31/05/2010 (2) 942.1 565.3 

Gain on bargain purchase 

at 31/12/2010 = [(2)-(1)] 477.5 286.5 

Acquisition costs 50Hertz (13.3) (8.0) 

Total non-recurring items 464.2 278.5 

This amount is compliant with the estimation of the fair value of 

the net assets of 50Hertz to be within a range of €890.3 million 

and €984.1 million. This fair value exercise was performed with 

the assistance of an independent valuation expert based on 

three methodologies and applying the following assumptions: 



145 

• discounting of future free cash flows (“FCF”) using the “Regulated 

Asset Base” or “RAB” as basis for the estimation of 

the terminal value FCF (“DCF method”) due to the nature 

of the business the net cash flow can be negative due to 

expected investment plans; 

• discounting of future expected dividends as estimated by 

the Company (“DDM method”). 

These analyses are based on financial prospects (business 

plan) prepared by management (not certified by the independent 

expert) for the period 2010 -2028 taking into account 

the current regulatory framework as described under chapter 

‘Regulatory framework and tariffs’. 

The business plan takes into account the expected positive 

impact of 

• the implementation and entry into force as of 1 January 

2010 of the AusgleichMechV compensation mechanism for 

the compensation of public services obligations in respect 

of the promotion of renewable energy sources (EEG), which 

allows to treat certain costs related to this mechanism as 

pass through costs and to include those costs in the tariffs; 

• an expected positive impact of the implementation of the 

“Korridor model” as of 1 January 2010, providing for a new 

treatment of the major part of system services (regulating 

power, compensation of network losses, re-dispatch), 

which allows to include most of these costs in the revenue 

cap; 

• a further optimisation of the costs relating to various support 

services (IT, insurance, cash pooling, consulting and 

various support services).

146 



The future cash flows and future dividends are based on the 

business plan prepared by the management during the first 

quarter of 2010 applying the current German tariff mechanism 

for the period 2010-2028 as and using the following assumptions: 

• period 2010-2018 mainly driven the management’s investment 

schedule which includes more capital expenditures 

than in the past years; 

• for the period 2019 -2028 driven by Elia’s and IFM’s investment 

schedule at a level which is closer to or even below the 

operating cash flow. The net RAB is nearly on a constant 

level in the years after 2021. The terminal value is based on 

the net RAB value which is assumed to be in a steady state 

in 2028. Basic assumptions are therefore that depreciation 

expenses balance capital expenditure and that there is no 

change in working capital. 

As the activity as ‘TSO’ is an activity with a long term perspective, 

the cash flows have been projected over the period 2010- 

2028. 

The applied discount rate of 5.7% (cost of equity 7.2% and the 

cost of debt of 5.1%) is in line with the WACC that results from 

applying the after-tax cost of equity and cost of debt rates set 

by the regulator BNetzA to 50Hertz (which amounts to 5.8%) 

and also with the WACC (weighted costs of capital) used by 

financial analysts for peer group companies. For purposes of 

the DDM method a pay-out ratio of 100% of the profit under 

German GAAP was assumed (which is not binding for the 

actual future pay-out ratio), market approach on the basis of 

prospective EBIT and EBITDA multiples (“Market approach”) 

and those used by some comparable West European listed 

companies, such as Red Electrica corpororation SA, Enagas, 

Terna, Fluxys, Snam Rete Gas, National Grid and Redes Energiticas 

Nacionais S.A. 

• The market approach method was primarily used to validate 

the results of the DCF and DDM valuation methods. 

The Company agrees with the conclusions of its independent 

expert to consider that the DCF method better reflects the 

steady state of the asset base with regard to terminal value. 

In particular, the P/E multiple was not retained due to a lack 

of comparability to peers as a result of (amongst other things) 

different regulatory regimes, depreciation methods and nonregulated 

income. In addition, due to 50Hertz’ investment 

schedule and one-off costs, forecasted net income, EBIT and 

EBITDA differ significantly and especially net income shows a 

high fluctuation from year to year, resulting in a wide overall 

value range which limits the relevance of the market approach 

method. As such, the preliminary range of fair value of the net 

assets is consistent with the valuation range resulting from the 

DCF method. 

The purchase price paid for the acquisition of 50Hertz results 

from negotiations between the parties following a competitive 

sale process. Vattenfall has released no information as to the 

reasons why 50Hertz has been sold with a bargain on purchase 

price. However, as stated in its annual report 2009, Vattenfall’s 

debt position has increased over the past few years, while its 

cash flow decreased, and Vattenfall AB announced in that context 

that it intended to improve profitability through concrete 

measures, amongst other things by re-prioritising and reducing 

its investments and divesting non-core assets. In addition, 

Vattenfall is subject to certain unbundling requirements under 

the Third Energy Package. 

7.2. Deconsolidation of Belpex NV/SA 

In October 2010 Elia sold its whole participation of 60% in its 

subsidiary Belpex NV/SA, the Belgian power exchange. The 

figures of Belpex NV/SA were fully consolidated in the figures 

at 31 December 2009. 

Elia and the Dutch transmission system operator TenneT BV 

both sold their shares in Belpex to APX-ENDEX Holding BV, 

the Dutch power exchange, as part of the integration of power 

exchanges in the North-Western Europe region. 

EFFECT OF DISPOSAL OF BELPEX NV/SA 

ON THE FINANCIAL POSITION OF THE GROUP 

Total (in million €) 2010 

Intangible assets (1.3) 

Trade and other receivables (9.3) 

Cash and cash equivalents (0.1) 

Non controlling interests 2.0 

Loans and borrowings 5.0 

Trade and other payables 1.9 

Other current liabilities 0.1 

Net identifiable assets and liabilities (1.7) 

Consideration received 11.4 

Cash and cash equivalents disposed of (0.1) 

Net cash inflow 11.3 

7.3. Financial risk and derivative 

management 

PRINCIPLES OF FINANCIAL RISK MANAGEMENT 

The Group aims to identify each risk and set out strategies to 

control the economic impact on the Group’s results. 

The Internal Audit & Risk Management Department defines the 

risk management strategy, monitors the risk analysis and reports 

to the management and the Audit Committee. The financial 

risk policy is implemented by determining appropriate policies 

and setting up effective control and reporting procedures. 

Selected derivative hedging instruments are used depending 

on the assessment of risk involved. Derivatives are used exclusively 

as hedging instruments. The regulatory framework in 

which the Group operates considerably restricts their effects 

on profit or loss (see the ‘Regulatory framework and tariffs’ 

chapter). The major impact of increased interest rates, credit

isk, etc. can be settled in the tariffs, in accordance with the 

applicable legislation. 

CREDIT RISK 

Credit risk encompasses all forms of counterparty exposure, 

i.e. where counterparties may default on their obligations to 

the company in relation to lending, hedging, settlement and 

other financial activities. The company is exposed to credit risk 

from its operating activities and treasury activities. In respect of 

its operating activities, the Group has a credit policy in place, 

which takes into account the risk profiles of the customers. The 

exposure to credit risk is monitored on an ongoing basis, resulting 

in a request to deliver bank guaranties from the counterparty 

for some major contracts. 

At the end of the reporting period there were no significant 

concentrations of credit risks. The maximum credit risk is the 

carrying amount of each financial asset, including derivative financial 

instruments. 


Loans and receivables 196.2 287.0 

Cash and cash equivalents 385,6 366.0 

Balance at bank 13,6 13.4 

Interest rate swaps used for hedging 

Assets 0.0 0.0 

Liabilities (35.2) (31.4) 

Total 560,2 635.0 

The movement in the allowance for impairment in respect of loans and receivables during the year was as follows: 

(in million €) Doubtful debtors 

Impairment 

losses 

Remaining 

balance 

BALANCE AT 1 JANUARY 2010 3.7 (3.4) 0.3 

Changes during the year 11.5 (11.5) 0.0 

BALANCE AT 31 DECEMBER 2010 15.2 (14.9) 0.3 

BALANCE AT 1 JANUARY 2011 15.2 (14.9) 0.3 

Changes during the year 6.8 (6.8) 0.0 

BALANCE AT 31 DECEMBER 2011 22.0 (21.7) 0.3 

Trade and other receivables are recorded without taking into 

account receivables which have been impaired. The impairment 

loss recognised in 2011 is mainly related to a settlement 

of receivables, which finally could be recovered in the future 

tariffs. 

CURRENCY RISK 

The Group is not exposed to any significant currency risk, either 

from transactions or from exchanging foreign currencies 

into euro, since it has only limited foreign investments or activities 

and less than 1% of its costs are expressed in currencies 

other than the euro. 



147 

LIQUIDITY RISK 

Liquidity risk is the risk that the Group may not be able to meet 

its financial obligations. The Group limits this risk by constantly 

monitoring cash flows and ensuring that there are always sufficient 

credit line facilities available. 

The Group’s objective is to maintain a balance between continuity 

of funding and flexibility through the use of bank loans, 

confirmed and unconfirmed credit facilities, commercial paper 

program, etc. For medium- to long-term funding, the Group 

uses bonds. The maturity profile of the debt portfolio is spread 

over several years. The Group Treasury frequently assesses its 

funding resources taking into account its own credit rating and 

general market conditions.

148 

Referring to the bond issues in 2009 and 2010, access to sources of funding should sufficiently be available. 




Non-derivative financial liabilities 

Carrying 

amount 

Expected 

cash 

outflows 

6 mths 

or less 

6-12 

mths 

1-2 

years 

2-5 

years 

> 5 

years 

Unsecured bond issues 2,293.1 (2,916.0) (106.1) (5.8) (112.4) (1,237.0) (1,454.7) 

Unsecured financial bank loans 

and other loans 555.8 (726.8) (8.6) (6.7) (16.0) (48.0) (647.5) 

Trade and other payables 439.4 (439.8) (439.4) 0.0 0.0 0.0 0.0 

Derivative financial liabilities 

Interest rate swaps used for hedging 31.4 (49.9) (6.2) (5.6) (8.7) (17.7) (11.8) 

Of which cash flow hedges 31.4 (49.9) (6.2) (5.6) (8.7) (17.7) (11.8) 

BALANCE AT 31 DECEMBER 2010 3,319.7 (4,132.5) (560.3) (18.1) (137.1) (1,302.7) (2,114.0) 

Non-derivative financial liabilities 

Unsecured bond issues 2,294.4 (2,806.1) (101.0) (11.6) (597.0) (1,187.8) (908.7) 

Unsecured financial bank loans 

and other loans 555.8 (711.8) (9.6) (6.8) (16.0) (87.1) (592.4) 

Trade and other payables 450.1 (450.3) (450.1) 0.0 0.0 0.0 0.0 

Derivative financial liabilities 

Interest rate swaps used for hedging 35.2 (40.5) (5.4) (5.6) (5.9) (17.7) (5.9) 

Of which cash flow hedges 35.2 (40.5) (5.4) (5.6) (5.9) (17.7) (5.9) 

BALANCE AT 31 DECEMBER 2011 3,335.5 (4,008.7) (566.1) (24.0) (618.9) (1,292.6) (1,507.0) 

Details of the used and unused available credit facilities are given below: 

Credit line facilities (in million €) Maturity 

Available 

amount 

Average 

basic interest Amount 

used not used 

Confirmed credit line 31/03/2014 150.0 Euribor + 0,55 % 0.0 150.0 


Confirmed credit line 01/06/2014 75.0 

Euribor + margin 

when concluding the deal 0.0 75.0 


Confirmed credit line not limited 72.0 

Uncommitted Credit Line Facility - 70.0 

Uncommitted Credit Line Facility - 100.0 

Monthly average 

of EONIA + 0,4% 0.0 72.0 





European Investment Bank - 125.0 Euribor + 0,05 % 60.0 65.0 

Belgian dematerialised treasury notes - 250.0 



TOTAL 1,127.0 60.0 1,067.0

INTEREST RATE RISK 

Interest rate risk is the risk that the fair value or future cash 

flows of a financial instrument will fluctuate because of changes 

in market interest rates. The Group’s exposure to the risk of 

changes in market interest rates relates primarily to the Group’s 

long-term debt obligations with floating interest rates. 

The Group manages its interest rate risk by having a balanced 

portfolio of fixed and variable rate loans and borrowings. To 

manage this, the Group enters into interest rate swaps, in 

which the Group agrees to exchange, at specified intervals, 

the difference between fixed and variable rate interest amounts 

calculated by reference to an agreed-upon notional principal 

amount. These swaps are designated to hedge underlying 

debt obligations. 

The table (see Note 6.11) shows the average interest rate at the 

balance sheet date. 

SENSITIVITY ANALYSIS 

Changes in the interest rates will not affect the consolidated 

result in the short and long term as the Group operates within a 

regulatory framework where the consequences of fluctuations 

in financial expenses are mainly recovered in tariffs, except for 

the items which are directly recognized through OCI. 

HEDGING 

All financial derivatives the Group enters into relate to an underlying 

transaction or forecasted exposure, depending on the 

expected impact on the income statement, and if the stringent 

IAS 39 criteria are met, the Group decides on a case-by-case 

basis whether hedge accounting will be applied. The following 

sections describe the transactions whereby hedge accounting 

is applied. At 31 December 2011 the Group has no transactions 

which do not qualify for hedge accounting. 

Fair value 

In accordance with the hedge accounting rules, all derivative 

financial instruments are accepted as cash-flow hedges and 

valued at fair value. Consequently, the portion of the gain or 

loss on the derivative financial instrument that can be considered 

an effective hedge is reflected directly in equity (hedging 

reserves net of tax). 

Interest-rate swaps have an interest rate varying from 4.23% to 

4.41%. As at 31 December 2011, the Group held hedging instruments 

with a contracted reference value of €395.8 million. 

The net fair value of the swaps as at 31 December 2011 totalled 

€35.2 million and was entirely composed of liabilities. The 

amounts are included as derivatives at fair value. 

As at 31 December 2011, no financial expenses resulting from 

ineffective cash-flow hedges are included in profit or loss. 

The overview below shows the fair values and carrying 

amounts of derivative financial instruments. As the loan has a 

variable interest rate, the carrying amount of the loan is equal 

to the fair value. 


Financial assets 

Carrying 

amount 

Fair 

value 

Carrying 

amount 

Fair 

value 

2011 2011 2010 2010 

Sicav 13.6 13.6 13.4 13.4 

Total 13.6 13.6 13.4 13.4 

Financial Liabilities 



149 

Derivative financial 

liabilities (Interest 

rate swap) (35,2) (35,2) (31,4) (31,4) 

Interest bearing 

loans and 

borrowings (395,8) (395,8) (395,8) (395,8) 

Total (431,0 (431,0) (427,2) (427,2) 

Fair-value hierarchy 

The above fair value of ‘sicavs’ belongs to level 1, i.e. valuation 

is based on the (unadjusted) listed market price on an active 

market for identical instruments. 

The above fair value of interest rate swaps belongs to level 2, 

which entails that valuation is based on input from other prices 

than the stated prices, where these other prices can be observed 

for assets or liabilities. This category includes instruments 

valued on the basis of listed market prices on active 

markets for such instruments; listed prices for identical or similar 

instruments on markets that are deemed less than active; 

or other valuation techniques arising directly or indirectly from 

observable market data. 

Estimate of fair value 

Derivatives 

Brokers’ statements are used for interest-rate swaps. The 

statements are controlled using valuation models or techniques 

based on discounted cash flows. 

Interest-bearing loans 

The fair value is calculated on the basis of the discounted future 

redemptions and interest payments. 

Financial lease obligations 

The fair value is estimated at the present value of future 

cash flows, discounted against the interest rate for uniform 

lease contracts. The estimated fair value reflects interest-rate 

changes. 

CAPITAL RISK MANAGEMENT 

The purpose of the Group’s capital structure management is to 

maintain the debt and equity ratios related to the regulated activities 

in line with the requirement of the regulatory framework 

(one-third equity and two-thirds debt capital). This approach 

allows the Group to manage the security of the liquidity at all 

times via flexible access to capital markets, so as to be able to 

finance strategic projects and to offer an attractive remuneration 

to shareholders.

150 

The company’s dividend policy involves optimising dividend 

payments while still bearing in mind that there is a requirement 

to reserve a part of the profit resulting from including the surplus, 

caused by decommissioning property, plant and equipment, 

in the tariff. Reserving this part of the profit as equity 

boosts the company’s self-financing capacity needed to carry 

out its legal mission. 

The company offers the employees the opportunity to subscribe 

to capital increases that are exclusively reserved for 

them. 

7.4. Commitment and contingencies 

OPERATING LEASE COMMITMENTS – GROUP AS A LESSEE 

The Group entered into commercial leases on motor vehicles, 

IT equipment and office buildings. The leases related to leasing 

cars and IT equipment have an average life of three years; the 

contracts regarding the buildings have a normal term of nine 

years, with the possibility of renewing the lease after that. 

Future minimum rentals payable under non-cancellable operating 

leases are as follows: 




5 

years 

Buildings 5.2 21.1 2.8 

Cars, IT equipment and others 6.2 13.5 0.0 

Total at 31 December 2010 11.4 34.6 2.8 

Buildings 5.8 18.5 2.1 

Cars, IT equipment and others 5.9 9.9 0.2 

Total at 31 December 2011 11.7 28.4 2.3 

The following expenses related to these lease contracts were 

recognised in the income statement: 


Buildings 6.6 4.7 

Cars, IT equipment and others 8.0 6.9 

Total 14.6 11.6 

These lease commitments include the commitments of the 

German segment for an amount of €12.4 million (at 60% stake 

of Elia). 

OPERATING LEASE COMMITMENTS – 

GROUP AS A LESSOR 

The Group has entered into commercial property leases on 

certain elements of property, plant and equipment, mainly 

consisting of optimising use of sites and high-voltage pylons. 

These leases have remaining terms of a minimum of nine years. 

Future minimum rental receivables are as follows: 


5 

years 

Telecom 5.9 3.8 1.9 

Buildings 0.2 0.1 0.1 

Total at 31 December 2010 6.1 3.9 2.0 

Telecom 4.7 13.4 19.5 

Buildings 0.3 0.4 0.1 

Total at 31 December 2011 5.0 13.8 19.6 

The following revenue related to these lease contracts was recognised 

in the income statement: 


Telecom* 11.1 10.3 

Buildings 0.5 0.4 

Total 11.6 10.7 

* The 2010 figures have been adjusted for comparison reasons (German segment - impact +300KEUR). 

The lease contingencies include the contingencies of the German 

segment for an amount of €6.8 million (at 60% stake of 

Elia). 

CAPITAL COMMITMENT 

As at 31 December 2011, the Group has a commitment of 

€448.0 million relating to the purchase and installation of property, 

plant and equipment for further grid extensions. These 

capital commitments include the capital commitments of the 

German segment for an amount of €333.8 million (at 60% stake 

of Elia). 

CONTINGENCIES 

Settlement mechanism 

• A calculation of the amount is given in the ‘Regulatory 

framework and tariffs’ chapter. 

• Application of IFRS 

The group operates in a regulated context which states that tariffs 

must make it possible to realise total revenue consisting of: 

1. a reasonable return on invested capital; 

2. all reasonable costs which are incurred by the group.

Since the tariffs are based on estimated figures, there is always 

a difference between the tariffs that are actually charged and 

the tariffs that should have been charged to cover all reasonable 

costs of the system operator and to provide shareholders 

with a reasonable profit margin on their investment. 

If the applied tariffs result in a surplus or a deficit at the end of 

the year, this means that the tariffs charged to consumers / the 

general public could have been respectively lower or higher 

(and vice versa). The group is convinced that a surplus or deficit 

arising from the settlement mechanism must not be classified 

as revenue or an expense, or as an item under equity. 

On a cumulative basis, it could be argued that the public has 

made an advance payment (=surplus) for its future use of the 

network. As such, the surplus (deficit) is not a commission for 

a future loss (recovery) of income but instead a liability (receivable) 

to (with regard to) consumers. On the basis of the Regulatory 

framework, the group believes that the surplus (deficit) 

does not represent an item of revenue (cost). Consequently, 

the group booked these amounts under section ‘Accruals and 

deferred income’ ‘see Note 6.16). 

7.5. Related parties 

TRANSACTIONS WITH KEY MANAGEMENT PERSONNEL 

The key management includes Elia’s Management Committee. 

They are hired as employees and the components of their remuneration 

are set out below. Directors do not receive stock 

options, special loans or other advances from the Group. 


Short term employee benefits 

- Basic remuneration 1.9 1.6 

- Variable remuneration 0.7 0.6 

Post-employment benefits 0.4 0.4 

Other variable remuneration 0.3 0.9 

Total gross remuneration 3.3 3.5 

Number of persons 7 7 

Average gross remuneration per person 0.5 0.5 

Number of shares 31,484 27,487 

In addition Elia’s management also assessed whether transactions 

occurred with entities in which the directors of the Group 

exercise a significant influence (e.g. positions as CEO, CFO, 

vice-presidents of the Board, etc.). Significant transactions 

occurred in 2011, all at arms’ length, with some distribution 

system operators. The total amount of realized sales equals to 

€102 million. The total amount of expenses equals to €5 million. 

There are no significant outstanding balances as per 31 

December 2011 on any of the above mentioned related parties. 

The disclosures relating to the Belgian Corporate Governance 

Code are included in the Corporate Governance Statement of 

this annual report. 

TRANSACTIONS WITH ASSOCIATED COMPANIES 

Transactions between the company and its subsidiaries which 

are related parties were eliminated during consolidation and 

therefore are not recognised in this note. 

In the 2011 and 2010 financial years, there were no transactions 

between Elia and HGRT. All transactions are at arm’s length. 

Details of transactions with other related parties are explained 

below. 


Transactions with joint venture 

and associated companies 

Sales of goods 4.3 3.6 

Purchases of goods 1.5 1.6 

Interest and similar revenue 0.2 0.0 

Outstanding balances with joint 

ventures and associated companies 



151 

Trade debtors 1.0 1.7 

Trade debts 0.1 1.6

152 

7.6. Subsidiaries, joint ventures and associates 

SUBSIDIARIES 

Elia System Operator NV/SA has direct and indirect control of the subsidiaries listed below: 

All the entities keep their accounts in euro (except E-Offshore A LLC and Atlantic Grid Investment A Inc, whose accounts are held 

in USD) and have the same reporting date as Elia System Operator SA (except Eurogrid International CVBA). 

Name 



Elia Asset SA Belgium 

Elia Engineering SA Belgium 

Elia Re SA Luxembourg 

JOINT VENTURES 

Eurogrid International SCRL/CVBA Belgium 

Eurogrid GMBH Germany 

50Hertz Transmission GmbH Germany 

50Hertz Offshore GmbH Germany 

Gridlab GmbH Germany 

E-Offshore A LLC U.S. 

Atlantic Grid Investment A Inc U.S. 

ASSOCIATED COMPANIES ACCOUNTED 

FOR USING THE EQUITY METHOD 

H.G.R.T S.A.S. (Holding de Gestionnaires de 

Réseaux de Transport) 

Country of 

establishment Headquarters Stake % 

France 

Coreso SA Belgium 

APX-ENDEX Holding BV Netherlands 

OTHER PARTICIPATIONS 

CASC-CWE SA Luxembourg 

EMCC European Market Coupling 

Company GmbH 

Germany 

CAO Central Allocation Office GmbH Germany 

Atlantic Grid A LLC U.S. 

Bd de l’Empereur 20 

1000 Brussels 


1000 Brussels 

Rue de Merl 65 

2146 Luxembourg 


1000 Brussels 

Eichenstraße 3a 

12435 Berlin 


12435 Berlin 


12435 Berlin 

Sielowerstraße 5 

03044 Cottbus 

874, Walker Road, Suite C 

19904 Dover, Delaware 

1209 Orange Stree 

19801 Wilmington, Delaware 

1 Terrasse Bellini 

92919 La Défense Cedex 

Avenue de Cortenbergh 71 

1000 Brussels 

Strawinksylaan 729 

1077 XX Amsterdam 

2 Rue de Bitbourg 

1273 Luxembourg-Hamm 

Hopfenmarkt 31 

20457 Hamburg 

Gute Änger 15 

85356 Freising 

4445, Willard Av, Suite 1050 

20815 Chevy Chase, Maryland 


99.99 99.99 

100.00 100.00 

100.00 100.00 

60.00 60.00 

60.00 60.00 

60.00 60.00 

60.00 60.00 

60,00 60,00 

60.00 - 

60.00 - 

24.50 24.50 

28.49 28.49 

20.00 20.00 

8.33 9.46 

12.00 12.00 

7.50 7.50 

6.00 -

7.7. Subsequent events 

On Friday 23 December, the Brussels Court of First Instance 

ruled in favour of Elia in its tax dispute 8 with the Belgian tax 

authorities. As a result of the ruling, the tax authorities must reimburse 

Elia €118.4 million, consisting of €80.2 million in taxes 

that were paid twice and which therefore must be reimbursed 

with 100% certainty, €5.1 million in prepayments, €8.5 million in 

administrative tax increase and €24.6 million in interest. However, 

the tax authorities lodged an appeal on 6 February 2012, 

thus suspending the ruling by the Court of First Instance. The 

Court of Appeal is not expected to rule on the case until 2014 

at the earliest. 

7.8. Relationship with auditors 

The General Meeting of Shareholders appointed the joint auditors 

KPMG Bedrijfsrevisoren Burg. CVBA (represented by Alexis 

Palm) and Ernst & Young Bedrijfsrevisoren BCVBA (represented 

by Marnix Van Dooren) for the audit of the consolidated 

financial statements of Elia System Operator NV/SA and the 

audit of the statutory financial statements of Elia System Operator 

NV/SA, Elia Asset NV/SA and Elia Engineering NV/SA. 

The Elia Group paid to the joint auditors during the year 2011 

an amount of €364,000.00 for the annual audit mandates, of 

which €197,500 has been paid to the statutory auditor of the 

German activities, Ernst & Young. 

The fees paid to the joint auditors for other engagements prescribed 

by the Belgian Company Law and engagements other 

than those prescribed by the Belgian Company Law amounted 

to respectively €33,225.00 and €163,890.00 for the year ended 

31 December 2011. The latter services related mainly to tax 

and VAT advice. 

In addition an amount of €605,418.00 has been paid in 2011 

for non-audit services in Germany. These fees can be detailed 

as follows: 

(in million €) Ernst & Young KPMG 

Attestation missions 34,900.00 0.00 

Tax advisory services 0.00 328,015.00 

IT advisory services 0.00 242,503.00 

Total 34,900.00 570,518.00 

The services were approved by the Audit Committee. 

8 Elia’s tariffs are based on estimated income and costs as well as budgeted volumes. At the end of each 

tariff period, this results in tariff surpluses or deficits that must be factored into future tariffs. However, in 

2008 the tax authorities ruled that tariff surpluses from the past (2003-2004) should be taxed immediately 

while Elia, in consultation with the regulator, considered this to be a debt in respect of future tariffs. All such 

tariff surpluses have actually been returned to consumers since the end of 2011. 

7.9. Declaration by responsible persons 

The undersigned Chairman of the Executive Committee and 

Chief Executive Officer Daniel Dobbeni and Chief Financial Officer 

Jan Gesquière declare that to the best of their knowledge: 

a) the consolidated financial statements for the year ending 

31 December 2011 have been prepared in accordance 

with the International Financial Reporting Standards (IFRS), 

and give a true and fair view of the consolidated financial 

position and results of the Elia Group and of its subsidiaries 

included in the consolidation; 

b) the annual report for the year ending 31 December 2011 

gives, in all material aspects, a true and fair view of the evolution 

of the business, the results and the situation of the 

Elia Group and of its subsidiaries included in the consolidation, 

as well as a description of the most significant risks 

and uncertainties with which the Elia Group is confronted. 

Brussels, 22 March 2012 



Daniel Dobbeni Jan Gesquière 

Chairman and CEO CFO 

153

154 



Joint auditors’ report 

on the consolidated financial 

statements



155

156 



Regulatory framework and tariffs 

1. Regulatory framework - Belgium 

1.1 Federal legislation 

The Electricity Act, as amended from time to time, forms the 

overall basis of and contains the main principles applicable to 

the regulatory framework, such as the unbundling of the transmission 

activities, operation of and access to the transmission 

system, establishment of the Transmission System Operator’s 

legal mission, tariff-setting and creation of a regulatory authority. 

Several royal decrees provide more detailed information 

about the regulatory framework. 

1.2 Regional legislation 

The three Belgian Regions are responsible for the distribution 

and local transmission of electricity through grids with a voltage 

equal to or lower than 70 kv in their respective territories. The 

Regions are not responsible for the tariff methodology, which 

falls under federal jurisdiction. Their impact on the liberalisation 

process is similar to the impact of the Electricity Act at the federal 

level. The regional decrees have been complemented by 

several other rules on matters such as public services, renewable 

energy, system operators and authorisation procedures 

for suppliers. 

1.3 Regulatory agencies 

As required by EU law, the Belgian electricity market is monitored 

and controlled by independent regulators. 

1.3.1 FEDERAL REGULATOR 

The Commission for Electricity and Gas Regulation (CREG) is 

the federal regulator and its powers with regard to Elia include: 

• approval of the standard terms of the three main contracts 

used by the company at the federal level: connection, access 

and ARP; 

• approval of the capacity allocation system at the borders 

between Belgium and neighbouring countries; 

• approval of the appointment of the independent members 

of the Board of Directors; and 

• approval of the tariffs for connection and access to, and 

use of the Elia grid. 

1.3.2 REGIONAL REGULATORS 

Operation of electricity grids with voltages of 70 kv and less 

falls within the jurisdiction of the respective regional regulators. 

Each of them may require any operator (including the company 

when it operates such grids), to abide by any specific provision 

of the regional electricity rules under the threat of administrative 

fines or other sanctions. The regional regulators are not 

empowered to set electricity transmission tariffs, as this task 

falls under the sole jurisdiction of the CREG. 

1.4 Tariff setting 

TARIFF REGULATIONS 

As the Belgian transmission system operator, Elia makes most 

of its income from the regulated tariffs charged for use of the 

transmission system (tariff income), which are approved in 

advance by CREG. A tariff regulation mechanism took effect 

on 1 January 2008 whereby the approved tariffs apply for a 

four-year period, barring exceptional circumstances. CREG 

approved the tariffs for the period 2008-2011 in December 

2007. The tariff mechanism is based on accounts stated in accordance 

with Belgian accounting regulations (Be GAAP). The 

tariffs are based on budgeted costs, less a number of sources 

of non-tariff income, and on the estimated volumes of electricity 

taken off the grid. 

The costs taken into account include the forecast value of the 

authorised fair remuneration and the predicted values of various 

cost categories, including those over which Elia has direct 

control (‘controllable costs’) and those over which it has no direct 

control (‘uncontrollable costs’).

FAIR REMUNERATION 

Fair remuneration is the return on capital invested in the grid. 

It is based on the average annual value of the regulated asset 

base (RAB), which is calculated annually, taking into account 

new investments, depreciations and changes in working capital 

requirements. 

In that context, which has not changed since 2008, the following 

formula is used to calculate the fair remuneration, when 

consolidated capital and reserves account for more than 33% 

of the average regulated asset base, as is the case at present: 

• A: [33% x average RAB x [(OLO n) + (Beta x risk premium)]] 

plus 

• B: [(S - 33%) x average RAB x (OLO n + 70 base points)] 

minus 

• C: adjustment of excessive depreciation rates in the past, 

where 

- OLO n is the interest rate for Belgian 10-year linear bonds 

for the year in question; 

- S = consolidated capital and reserves/RAB, in accordance 

with Belgian accounting standards (Be GAAP); 

- Beta will eventually be calculated based on Elia share 

prices, compared with the Bel20 index, over a seven-year 

period. In a transitional phase, the tariff regulations stipulate 

using Electrabel’s beta for the period preceding Elia’s 

flotation on the stock exchange. The value of beta cannot 

be lower than 0.3. 

Part A 

The rate of remuneration (in %) as set by CREG for year ‘n’ is 

equal to the sum of the risk-free rate, i.e. the average rate of 

Belgian 10-year linear bonds and a premium for share market 

risk, weighted using the applicable beta factor. 

The tariff regulations set the risk premium at 3.5%. For 2009, 

the applicable beta factor was calculated based on the historic 

beta factor for Electrabel, compared with the Bel20 index, over 

a seven-year period. CREG recommends that Elia’s solvency 

ratio (average capital and reserves/average regulated assets) 

should be as close to 33% as possible. This ratio (33%) is applied 

to Elia’s average regulated asset base (RAB) to calculate 

Elia’s reference capital and reserves. 

Part B 

If Elia’s actual capital and reserves are higher than the reference 

capital and reserves, the surplus amount is balanced out 

with a reduced rate of remuneration calculated using the following 

formula: [(OLO n + 70 base points)]. 

Part C 

CREG also decided that the annual fair remuneration margin 

should be reduced by €12.4 million (before taxes), due to overly 

rapid depreciations before Elia System Operator NV/SA was 

appointed transmission system operator, which it considers to 

be excessive. The tariff regulations also provide for the possibility 

of setting higher remuneration rates for capital that is invested 

to finance projects of national or European importance. 

In the absence of a decree implementing this provision of the 

Electricity Act, this measure was not carried out in 2011. 



157 

UNCONTROLLABLE COSTS 

The costs over which Elia has no direct control (‘uncontrollable 

costs’) are an integral part of the costs used to determine the 

tariffs. The tariffs are set based on forecasted values for these 

costs. The balances of such uncontrollable costs (whether 

positive or negative), i.e. the difference between the actual and 

forecast costs, will be established ex-post and their allocation 

will be the subject of a royal decree discussed by the Belgian 

Federal Council of Ministers. 

CONTROLLABLE COSTS 

The costs over which Elia has direct control (‘controllable 

costs’) are subject to an incentive regulation mechanism: in 

other words, they are subject to application of a productivity 

and efficiency improvement factor. This factor indicates the efforts 

that Elia must make to control such costs: the authorised 

costs used to determine the tariffs are established following 

application of this factor. The productivity improvement required 

of Elia over the period 2008-2011 is stipulated in the 

Royal Decree of 18 December 2007. The amount for 2011 was 

€8 million. The balances of such controllable costs (whether 

positive or negative), i.e. the difference — established ex-post 

— between the actual and authorised costs, are in principle 

either added to or deducted from the fair remuneration. 

CHANGES IN TARIFF REGULATIONS 

During 2011, amendments were made to a number of regulations. 

This is likely to have a direct impact on the tariff framework 

currently in force for transmission tariffs. In particular, the 

transposition into Belgian law of the third European Directive on 

the organisation of the electricity market called for the revision 

of the Electricity Act, which entered into force in early 2012. 

Under the amended Act, CREG is in charge of establishing a 

methodology for setting transmission tariffs. In late 2011, CREG 

provisionally adopted such a methodology, which was used as 

a basis to draft the tariff proposal approved on 22 December 

by CREG for 2012-2015.

158 



2. Regulatory framework in Germany 

2.1 Relevant legislation 

The German legal framework is laid down in various pieces of 

legislation. The key law is the German Energy Act 2005 (Energiewirtschaftsgesetz 

– EnWG), which defines the overall legal 

framework for the gas and electricity supply industry in Germany. 

The EnWG is supported by a number of laws, ordinances 

and regulatory decisions, which provide detailed rules on the 

current regime of incentive regulation, accounting methods 

and network access arrangements, including: 

• the Ordinance on Electricity Network Tariffs 2005 (Verordnung 

über die Entgelte für den Zugang zu Elektrizitätsversorgungsnetzen 

(Stromnetzentgeltverordnung – Strom- 

NEV)), as amended from time to time, which establishes, 

inter alia, principles (Grundsätze) and methods for the grid 

tariff calculations and further obligations of system operators; 

• the Ordinance on Electricity Network Access 2005 (Verordnung 

über den Zugang zu Elektrizitätsversorgungsnetzen 

(Stromnetzzugangsverordnung – StromNZV), as amended 

from time to time, most recently by Article 2(1) of the Ordinance 

of 17 October 2008, which, inter alia, sets out the 

further detail on how to grant access to the transmission 

systems (and other types of grids) by way of establishing 

the balancing amount system (Bilanzkreissystem), scheduling 

of electricity deliveries, control energy and further 

general obligations, e.g. capacity shortage (Engpaßmanagement), 

publication obligations, metering, minimum requirements 

for various types of contracts and the duty of 

certain system operators to manage the ‘Bilanzkreissystem’ 

for renewable energy; 

• the Ordinance on Incentive Regulation 2007 (Verordnung 

über die Anreizregulierung der Energieversorungsnetze 

(Anreizregulierungsverordnung – ARegV)), as amended 

from time to time, which sets out the basic rules for incentive 

regulation of TSOs and other system operators (as further 

described below). It also describes in general terms how 

to benchmark efficiency, which costs enter the efficiency 

benchmarking, the method of determining inefficiency and 

how this translates into yearly targets for efficiency growth. 

2.2 Regulatory agencies in Germany 

The regulatory agencies for the energy sector in Germany are 

the Federal Network Agency (Bundesnetzagentur – BNetzA) 

in Bonn for grids to which over 100,000 grid users are directly 

or indirectly connected and the specific regulatory authorities 

in the respective federal states for grids to which fewer than 

100,000 grid users are directly or indirectly connected. The 

regulatory agencies are, inter alia, in charge of ensuring nondiscriminatory 

third-party access to grids and monitoring the 

grid-use tariffs levied by the TSOs. 50Hertz and 50Hertz Offshore 

are subject to the authority of the BNetzA. 

2.3 Tariff setting in Germany 

A new tariff regulation mechanism was established in Germany 

by ARegV. According to ARegV, from 1 January 2009, grid tariffs 

are defined to generate a pre-defined ‘revenue cap’ as determined 

by the BNetzA for each TSO and for each regulatory 

period. The revenue cap is principally based on the costs of a 

base year, and is fixed for the entire regulatory period, except 

when it is adjusted to account for specific cases provided for 

in the ARegV. The system operators are not allowed to retain 

revenue in excess of their individually determined revenue cap. 

Each regulatory period lasts five years, and the first regulatory 

period started on 1 January 2009 and will end on 31 December 

2013. Tariffs are public and are not subject to negotiation 

with customers. Only certain customers (under certain fixed 

circumstances that are accounted for in the relevant legislation) 

are allowed to agree to individual tariffs according to Article 19 

of StromNEV (for example, in the case of sole use of a network 

asset). The BNetzA has to approve such individual tariffs. 

For the purposes of the revenue cap, the costs incurred by a 

system operator are classified into two categories as follows: 

• Permanently non-influenceable costs (PNIC): these costs are 

fully integrated into the ‘revenue cap’ and are fully recovered 

by the gridtariffs, albeit with a two-year time-lag. PNIC includes 

return on equity, imputed trade tax, cost of debt, depreciation 

and operational costs (currently at a fixed rate of 

0.8% of the capitalised investment costs of the respective investments). 

The cost of debt related to investment budgets is 

currently capped at the lower value of the actual cost of debt 

or cost of debt as calculated in accordance with a published 

BNetzA guideline. In addition, PNIC includes costs relating to 

ancillary services, grid losses and re dispatch costs. These 

costs are included in the revenue cap based on a procedural 

regulation mechanism set by the BNetzA in accordance with 

Article 11(2) ARegV (FSV) that provides system operators with 

an incentive to outperform the planned costs with a bonus 

and penalty mechanism. The grid services costs are based 

on planned costs (taking into account changes in both vol-

ume needs and prices) instead of incurred costs in the base 

year and, as such, only the productivity factor is applicable to 

such costs. While the mechanism for the current regulatory 

period is fixed for ancillary services and grid losses, for redispatch 

costs it is still subject to approval from 2011 onwards. 

Furthermore, this model is subject to approval or change in 

the second regulatory period starting in 2014. 

• Temporary non-influenceable costs (TNIC) and influenceable 

costs (IC): these costs include return on equity depreciation, 

cost of debt and of imputed trade tax and are subject to an 

incentive mechanism as set by the BNetzA, which contains 

an efficiency factor (only applicable to IC), a productivity factor 

improvement and an inflation factor (applicable to both 

TNIC and IC) over a five-year period. In addition the current 

incentive mechanism provides for the use of a quality factor, 

but the criteria and implementation mechanism for such a 

factor are yet to be described by the BNetzA. The various 

defined factors give the TSOs a medium-term objective to 

eliminate what are deemed to be inefficient costs. As regards 

the cost of debt, the allowed cost of debt related to influenceable 

costs is capped at the lower value of the actual cost of 

debt in the base year or the implied cost of debt based on 

the 10-year average of the ‘Umlaufsrenditen festverzinslicher 

Wertpapiere inländischer Emittenten’ (10-year average yield 

of the domestic fixed income securities as published by the 

Bundesbank) in the base year. 

• As for return on equity, the relevant laws and regulations set 

out the provisions relating to the allowed return on equity, 

which is included in the TNIC/IC for assets belonging to the 

regulatory asset base and the PNIC for assets approved in 

investment budgets. For the first regulatory period (2009- 

2013), the return on equity is set at 7.56% for investments 

made before 2006 and 9.29% for investments made since 

2006, based on 40% of the total asset value regarded as ‘financed 

by equity’ with the remainder treated as ‘quasi-debt’. 

The return on equity is calculated before corporate tax and 

after imputed trade tax. For the next regulatory period, the 

German regulator has calculated 2011 return at a value equal 

to 9.05%, despite the current lowering of capital market indices 

to foster attractive enough conditions for grid investment, 

vital for the timely implementation of energy policy. For 

the new tariff period, return on investment made before 2006 

is set at 7.14%. 

• In addition to the revenue cap, 50Hertz is compensated for 

costs incurred related to its renewable energy obligations, 

including EEG and CHP/KWKG obligations, subject to specific 

regulatory mechanisms aimed at a balanced treatment 

of costs and income. 



159 

CHANGES IN TARIFF REGULATIONS 

Progress was made in 2011 following discussions with the 

regulator to improve the regulatory framework for new investments 

in grid infrastructure; the coverage of grid management 

and development costs; return on capital; and the conditions 

under which new offshore farms should be connected. On this 

basis, the ARegV is to be amended for the benefit of system 

operators in the first half of 2012. 

The cap applicable in 2011 was 3% higher than in 2010. The 

cap used as a basis for tariffs, applicable since 1 January 2012, 

is some 15% higher than in 2011. 

As at 31 December 2011, 50Hertz had obtained approval for 

44 of the 75 investment budget requests made since 2008. 

The approved investment budget accounts for €2.501 billion. 

50Hertz was also successful in a case brought before the Higher 

Regional Court of Düsseldorf regarding the organisation of 

investment budget approvals by the BNetzA. In its decision of 

23 March 2011, the court ruled as illegal the ‘amount to prevent 

double recognition’ and the dismissal of interest charges on 

borrowed funds. Discussions on the regulation of this issue are 

due to conclude in the first quarter of 2012. 

In the context of discussions to enhance the regulatory framework 

for grid investment, the legislator is also looking into the 

possibility of a target-cost (t-0) approach instead of the current 

time-frame of two years (t-2), enabling faster depreciation.

160 



Information about 

the parent company 

Extracts from the statutory annual accounts of Elia System 

Operator NV/SA, drawn up in accordance with Belgian accounting 

standards, are given hereafter in abbreviated form. 

Pursuant to Belgian company legislation, the full financial statements, 

the annual report and the joint auditors’ report are filed 

with the National Bank of Belgium. 

1. Statement of position after distribution of profits 

These documents will also be published on the Elia website 

www.elia.be and can be obtained on request from Elia System 

Operator NV/SA, Boulevard de l’Empereur 20, 1000 Brussels, 

Belgium. The joint auditors made an unreserved statement with 

an explanatory paragraph in the statutory financial statements. 

ASSETS 2011 2010 


FIXED ASSETS 3.612,7 3.612,7 

Financial fixed asset 3.612,7 3.612,7 

Affiliated companies 3.583,0 3.583,0 

Participating interests 3.583,0 3.583,0 

Other enterprises linked by particpating interests 29,4 29,4 

Participating interests 29,4 29,4 

Other participating interests 0,3 0,3 

CURRENT ASSETS 859,3 942,3 

Amounts receivable after more than one year 94,0 93,8 

Other amounts receivable 94,0 93,8 

Inventories and contracts in progress 5,0 4,7 

Contracts in progress 5,0 4,7 

Amounts receivable within one year 587,1 602,1 

Trade debtors 120,1 165,4 

Other amounts receivable 467,0 436,7 

Investments 130,0 120,0 

Other term deposits 130,0 120,0 

Cash at bank and in hand 24,4 99,3 

Deferred charges and accrued income 18,8 22,4 

TOTAL ASSETS 4.472,0 4.555,0



161 

EQUITY AND LIABILITIES 2011 2010 


CAPITAL AND RESERVES 1.621,2 1.586,8 

Capital 1.505,4 1.505,4 

Issued capital 1.505,4 1.505,4 

Share premium account 8,5 8,5 

Reserves 83,7 67,6 

Legal reserve 83,7 67,6 

Profit carried forward 23,6 5,3 

PROVISIONS, DEFERRED TAXES 3,0 3,0 

Provisions for risks and charges 3,0 3,0 

Other risks and charges 3,0 3,0 

LIABILITIES 2.847,8 2.965,2 

Amounts payable after one year 2.554,2 2.553,8 

Financial debts 2.554,2 2.553,8 

Unsubordinated debentures 1.998,4 1.998,0 

Credit institutions 60,0 60,0 

Other loans 495,8 495,8 

Amounts payable within one year 223,6 309,5 

Current portion of amounts payable after more than one year 0,0 0,0 

Financial debts 0,0 0,0 

Credit institutions 0,0 0,0 

Trade debts 45,5 128,4 

Suppliers 45,5 128,4 

Advances received on contracts in progress 11,6 8,9 

Amounts payable regarding taxes, remuneration and social security costs 7,4 7,3 

Taxes 0,0 0,2 

Remuneration and social security 7,4 7,1 

Other amounts payable 159,1 164,9 

Accrued charges and deferred income 70,0 101,9 

TOTAL EQUITY AND LIABILITIES 4.472,0 4.555,0

162 



2. Income statement 


OPERATING INCOME 760,0 723,2 

Turnover 753,9 718,7 

Increase (+), decrease (-) in inventories of finished goods, works ans contracts in progress 0,2 0,0 

Other operating income 5,9 4,5 

OPERATING CHARGES (586,9) (563,6) 

Services and other goods (551,6) (531,1) 

Remuneration, social security costs and pensions (35,3) (32,8) 

Provisions for liabilities and charges 0,0 0,3 

OPERATING INCOME 173,1 159,6 

Financial income 105,2 53,6 

Income from financial fixed assets 93,4 46,7 

Income from current assets 11,8 6,9 

Financial charges (129,3) (133,7) 

Interest and other debt charges (128,4) (132,0) 

Other financial charges (0,9) (1,7) 

PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 149,0 79,5 

Extraordinary income 1,5 9,7 

Proceeds from sale of investments 0,0 9,7 

Other extraordinary income 1,5 0,0 

Extraordinary charges (8,9) (4,8) 

Other extraordinary charges (8,9) (4,8) 

PROFIT FOR THE FINANCIAL PERIOD BEFORE TAXATION 141,6 84,4 

Income taxes (18,5) (10,9) 

Income taxes (18,5) (10,9) 

Adjustments of income taxes and write-back of provisions 0,0 0,0 

PROFIT FOR THE FINANCIAL PERIOD 123,1 73,5

GRI Index 

Profile 

Indicator Description Page 

1. STRATEGY AND ANALYSIS 

1.1 Statement from the most senior decision-maker of the organization (e.g., CEO, Chair, or equivalent 

senior position) about the relevance of sustainability to the organization and its strategy. 1, 2 

2. ORGANIZATIONAL PROFILE 

2.1 Name of the organization. 1 

2.2 Primary brands, products and/or services. 4 

2.3 Operational structure of the organization, including main divisions, operating companies, 

subsidiaries and joint ventures. 4, 115 

2.4 Location of organization’s headquarters. 165 

2.5 Number of countries where the organization operates, and names of countries with either major 

operations or that are specifically relevant to the sustainability issues covered in the report. 4, 152, 153 

2.6 Nature of ownership and legal form. 152, 160, 161 

2.7 Markets served (including geographic breakdown, sectors served 

and types of customers/beneficiaries). 4 

2.8 Scale of the reporting organization, including: number of employees; net sales); total 

capitalization broken down in terms of debt and equity and quantity of products or services 

provided. 4,152, 153 

2.9 Significant changes during the reporting period regarding size, structure or ownership. 6 to 11, 87 to 89 

2.10 Awards received in the reporting period. 7, 11, 17, 52, 65 

3. REPORT PARAMETERS 

3.1 Reporting period for information provided. 165 

3.2 Date of most recent previous report. April 2011. 

3.3 Reporting cycle (annual, biennial, etc). 165 

3.4 Contact point for questions regarding the report or its contents. 165 

3.5 Process for defining report content. 1, 4, 12, 13, 

77 to 81, 165 

3.6 Boundary of the report. 165 

3.8 Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations and other 

entities that can significantly affect comparability from period to period and/or between organizations. 



from 115 to 125 

125 to 130 

3.12 Table identifying the location of the Standard Disclosure in the report. 163, 164 

163

164 


4. GOVERNANCE, COMMITMENTS AND ENGAGEMENT 

4.1 Governance structure of the organization, including committees under the highest governance body 

responsible for specific tasks, such as setting strategy or organizational oversight. 84 to 86 

4.2 Indicate whether the Chair of the highest governance body is also an executive officer (and, 

if so, their function within the organization’s management and the reasons for this arrangement). 84 

4.3 For organizations that have a unitary board structure, state the number of members 

of the highest governance body who are independent and/or non-executive members. 84 

4.4 Mechanisms for shareholders and employees to provide recommendations or direction 

to the highest governance body. Include reference to processes. 78, 87, 88 

4.14 List of stakeholder groups engaged by the organization. 22, 48, 62, 

77 to 81 

4.15 Basis for identification and selection of stakeholders with whom to engage. 74 

Data on performance 


ECONOMIC 

EC1 Direct economic value generated and distributed, including revenues, operating costs, employee 

compensation, donations and other community investments, retained earnings, and payments to 

capital providers and governments. 128, 129 

EC2 Financial implications and other risks and opportunities for the organization’s activities due to climate 

change. 

24, 30 to 33, 

44 to 456 

EC8 Development and impact of infrastructure investments and services provided primarily for public 

benefit through commercial, in kind, or pro bono engagement. 34, 35 

ENVIRONMENTAL 



EN5 Energy saved due to conservation and efficiency improvements. 49, 50 

EN6 Initiatives to provide energy-efficient or renewable energy based products and services, and 

reductions in energy requirements as a result of these initiatives. 52, 54 

EN7 Initiatives to reduce indirect energy consumption and reductions achieved. 52, 56 to 59 

EN11 Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of 

high biodiversity value outside protected areas. 51 

EN12 Description of significant impacts of activities, products, and services on biodiversity in protected 

areas and areas of high biodiversity value outside protected areas. 56 

EN14 Strategies, current actions, and future plans for managing impacts on biodiversity. 51 

EN18 Initiatives to reduce greenhouse gas emissions and reductions achieved. 52 

EN22 Total weight of waste by type and disposal. 53 

EN26 Initiatives to mitigate environmental impacts of products and services, and extent of impact 

mitigation. 56 to 59 

LABOR: PRACTICES AND DECENT WORK 

LA1 Total workforce by employment type, employment contract, and region. 65, 68 

LA7 Rates of injury, occupational diseases, lost days, and absenteeism, and number of workrelated 

fatalities by region. 72, 73 

LA10 Average hours of training per year per employee by employee category. 67 

LA11 Programs for skills management and lifelong learning that support the continued employability of 

employees and assist them in managing career endings. 66, 67 

LA12 Percentage of employees receiving regular performance and career development reviews. 66

Reporting parameters 

Head office 

This report is limited to Elia System Operator and Elia Asset, 

which operate as a unique economic entity under the name 

Elia, and 50Hertz Transmission. 

The registered office of 

Elia System Operator and Elia Asset is located at 

Boulevard de l’Empereur, 20 

1000 Brussels, Belgium 


50Hertz Transmission GmbH is located at 

Eichenstraße 3A 

12435 Berlin, Germany 


Eurogrid International is located at 

Avenue de Cortenbergh, 71 

1000 Brussels, Belgium 

Reporting period 

This annual report covers the period from 1 January 2011 

to 31 December 2011. 

It incorporates the principles from the sustainable development 

report as required by the GRI. 

Contact 

Lise Mulpas 

Corporate Communication 

Boulevard de l’Empereur, 20 

1000 Brussels 

lise.mulpas@elia.be 

Tel. : 02 526 73 75 

Fax : 02 546 72 90 



165

166 



Notes



167

168 


FINANCIAL REPORT

List of abbreviations 

APERe Association for the promotion of renewable energies 

BBEMG Belgian BioElectroMagnetic Group 

BREEAM BRE Environmental Assessment Method 

BRUGEL Brussels Electricty and Gas Regulation 

CREG Commission for Electricity and Gas Regulation 

CWAPE Commission Wallonne pour l’Energie 

IBGE Brussels Institute for Environmental Management 

ICEDD Institut de Conseil et d’Etudes pour le Développement Durable 

ICNIRP International Commission on Non-Ionizing Radiation Protection 

OVAM Openbare Vlaamse Afvalstoffenmaatschappij 

SYNERGRID Federation of Belgian System Operator for Electricity and Gas 

VREG Vlaamse Reguleringsinstantie voor de Electriciteits- en Gasmarkt 

(Flemish Commission for Electricity and Gas Control) 

CORESO Technical Coordination Service Center within the Central Western European region 

CWE Central Western Europe 

ENTSO-E European Network of Transmission System Operators for Electricity 

ITVC Interim Tight Volume Coupling 

ARP Access responsible party 

EMF Electric and Magnetic Fields 

GIS Gas insulated Switchgear 

PCB’s Polychlorinated biphenyls 

RUE Rational Use of Energy 

kWh Kilowatt hour 

MW Megawatt 

MWh Megawatt hour (=1.000 kWh) 

gWh Gigawatt hour (=1.000 MWh) 

kV Kilovolt (=1.000 Volts)

Legend 

Switching Station (in large part with transition 

to distribution system operators) 

220 kV 

380 kV 

380 kV planned / under construction 

380 / 220 kV 

Other companies 

line 380 kV 

line planned / 380 kV 

under construction 

line 220 kV 

Operating voltage ( kV ) 110 

Other companies 380 / 220 kV 

HVDC/DC link 400 kV 

Grid connection offshore 150 kV 

Grid connection offshore 150 kV 

planned / under construction 

System users : 

Our customers include the regional distribution 

system operators as well as power 

plants, pump storage plants, wind farms 

and big industry connected to the transmission 

system. 

Conventional power plant 

( lignite- or hard-coal � red, nuclear 

or gas turbine power plant ) 


Pump storage plant 

Wind power plant onshore / offshore 

planned / under construction 

As at : December 2011 

Denmark 

Schleswig- 

Holstein 

Lower Saxony 

Hesse 

Legend 

Bavaria 

Hamburg 

TenneT 

Thuringia 

Energinet.dk 

Denmark 

Schwerin 

Saxony- 

Anhalt 

Rostock 

TenneT 

Güstrow 

110 

Mecklenburg- 

Western-Pomerania 

Magdeburg 

Halle 

Weimar 

Switching Station (in large Erfurt part with transition 

to distribution system operators) 

Eisenach 

Gera 

Jena 

220 kV 

380 kV 

380 kV planned / under construction 

380 / 220 kV 

Other companies 

line 380 kV 

line planned / 380 kV 


Brandenburg 

Zwickau 

Neubrandenburg 

Leipzig 

380+220 

Saxony 

Potsdam 

Chemnitz 

110 

220 

Dresden 

Berlin 

Cottbus 

Č EPS 

Czech Republic 

PSE Operator 

Poland 

Frankfurt (Oder) 

Grid 50Hertz

www.eliagroup.eu www.elia.be www.50hertz.com 

Head office Elia 

Boulevard de l’Empereur 20, B-1000 Brussels 

T +32 2 546 70 11 - F +32 2 546 70 10 

info@elia.be 

Contacts 

Lise Mulpas, T +32 2 546 73 75 

Axelle Pollet, T +32 2 546 75 11 

Concept and editorial staff 

Elia, department Communication 

Graphic design and coordination 

www.witvrouwen.be 

Illustrations 

Renaud Collin 

Photos Elia 

Alain Schroeder, Antonio Caliaro, 

Benjamin Miesse, Danny Gys, Eric Figon, Eric Herchaft, 

Guy Van Hooveld, Michel Vanden Eeckhoudt, Olivier Polet, 

Wim Beddegenoodts, Photothèque Elia 

Photos 50Hertz 

Jan Pauls, Andreas Teich, EnBW 

Editor 

Jacques Vandermeiren 

Ce document est également disponible en français. 

Dit document is ook beschikbaar in het Nederlands. 

Dieses Dokument ist auch auf Deutsch verfügbar. 

April 2012

Annual Report 2011 - Elia

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