Statement from the Chairman


Dear shareholder,

The year of 2012 was a landmark year for EDP Renováveis. It was a year in which – despite substantial headwinds – we were able to persevere and deliver high quality value to our shareholders. Above all, it was a year when EDPR further strengthened its long-term commitment to the development of renewable energy, through the decisive implementation of new strategic initiatives. These changes will be fundamental in driving growth in a new challenging energy playing field, ensuring value creation for the foreseeable future.

EDPR recorded yet another solid performance in 2012, delivering on the high expectations of its Board of Directors and on the commitments made to its shareholders. The company continues to show significant growth, with the renewable energy portfolio reaching 8.0 GW, coupled with outstanding metrics of operational and financial efficiency. The partnership with CTG was deployed quickly and the first transaction, involving wind farm assets in Portugal, finalized just 7 months after CTG entered EDP’s shareholder structure. This performance is all the more remarkable in light of the near-term difficulties the company has had to tackle in its core markets either by a demand slowdown, regulatory changes or public misperception regarding the cost of renewables.

Now more than ever, we are strongly committed to the vision we defined when we first identified the potential of renewables. We believed that these technologies, that were then in their infancy, would quickly develop to become cost competitive and command a large share of the world’s generation mix. This vision is now a reality. Not only do renewables account for half of all the power generation additions worldwide but they have also become increasingly cost competitive. Wind onshore is now broadly competitive with conventional generation sources such as coal, nuclear or CCGT, and technologies like solar PV and wind offshore are quickly catching up.

Our long-term vision remains unchanged, however recent changes in the industry are opening up a number of opportunities for EDPR’s future. The emergence of new renewable markets, around the world, and the growing share of new renewable technologies entering the energy mix are both trends that we have identified early and look to capitalize on. In this dynamic environment we have been able to stay ahead of the curve and implement new strategic initiatives that will continue to drive long-term value creation. Importantly this strategy focuses on growth in our markets of Romania, Poland and Brazil, while at the same time looking for selective investment opportunities in new geographies and technologies. The early investment in solar PV, is just one example of the effective implementation of these initiatives and one that I take with personal satisfaction. As a firm advocate of the benefits of renewable technologies I see great potential in solar PV. This technology is quickly becoming cost competitive to a level that warrants large scale investment. This will naturally generate growth opportunities for EDPR, as well as the creation of vast knowhow and economic value for our industry and its communities. The partnership with CTG will certainly play a strong role in the execution of the new objectives we have set. I’m sure that in 2013 we will see further progress in this respect, in areas apart from asset rotation.

I would like to highlight the Board’s unanimous and enthusiastic support of these new initiatives. In this ever-changing industry, complacency and inaction is not a luxury that we can afford. It is our stern belief that these are the correct steps for ensuring continued leadership in this industry. On this topic, I would like to highlight the high level of involvement of the entire Board in the discussion of the new business plan. It is our duty to ensure that the interests of all investors are taken into consideration when deciding on issues of this magnitude. This has always been EDPR’s stance and it attests to the quality of our corporate governance structure.

I am pleased to report that we have become signatories of the United Nations Global Compact and we have committed ourselves to support and put into practice the 10 principals of the Global Compact with respect to human rights, labour, environment and anti-corruption. The way the Company executes its strategy, developing and operating a world-wide fleet generating clean and CO2-free electricity, respecting biodiversity and supporting the society, are decisive contributors for a leadership position in the global sustainability arena.

On behalf of my colleagues of the Board, I would like to extend my sincerest thank you to our employees. It has been their effort and dedication than has allowed us to achieve our challenging goals over the years. Once again we will call on their expertise and enthusiasm to rise-up to the difficult challenges to come. It is the company’s commitment to foster an environment that is conductive of growth and development. We actively pursue the highest standards of health and safety, ethics and diversity, while proving challenging career opportunities for our employees.

We have performed strongly throughout 2012 and have been actively implementing a strategy that will provide continued value throughout the next decade. We count on your continued support in the pursuit of these challenging goals.


António Mexia

Chairman of the Board of Directors