The relationship with the Italian regulatory and supervisory authorities

The Italian regulatory authorities that mainly affect the Group’s activities are the Regulatory Authority for Energy, Networks and the Environment (Arera), and the Italian Antitrust Authority (Agcm).

The Arera proceedings that directly involved the Group in 2018, as part of the Authority enforcement activities, are reported below.

With reference to the preliminary investigation that was closed due to failure to comply with the obligations to replace the cast iron pipelines with hemp and lead joints (VIS 39/2011), after completing our commitment to rapidly replace them entirely in the Ferrara distribution system, we are going ahead with our commitment to inspect the entire hemp asbestos cement network that will involve the complete replacement thereof as per the timescales set by the Regulation of the Quality of the Gas Distribution Service (RQDG).

With regard to the procedure regarding unrequested electricity or gas contracts and publication of a list of so-called “unrequested sellers”, launched further to the publication of resolutions 153/2012/R/com and 244/2013/R/com, the final report has not yet been published.

Following the audit of July 2017 conducted at the offices of Hera spa and Inrete Distribuzione Energia regarding compliance with the requirements of the indemnification system in the event of customers in arrears (resolutions ARG/elt 191/09 and 219/10), by way of decisions DSAI/7/2018/EEL and DSAI/8/2018/EEL, Arera initiated a sanctioning procedure and imposed the following sanctions: Hera spa Euro 148,740 and Inrete Distribuzione Energia Euro 25,470; both sanctions were paid reduced by one third.

The proceedings initiated by way of resolution 344/2014/S/eel against Hera Comm to establish breaches in the separation of accounts with regard to the separate annual accounts submitted in 2009 and 2010, ended with the imposition of an administrative sanction on Hera Comm of Euro 90,000 (resolution 304/2018/S/EEL).

Lastly, in July 2018, following the results of the inspection of January 2018, by way of decision DSAI 47/2018/EEL, the Authority sanctioned AcegasApsAmga for breach of the Integrated Information System regulations with reference to electricity distribution activities. The administrative sanction, amounting to Euro 57,900 was paid reduced by one third.