Market West

Alpiq exceeded its sales and profit expectations in Spain and France, consolidating its position as the most important alternative to established energy suppliers. A series of internal and external growth projects helped Alpiq to retain and further strengthen this position. New customer acquisitions more than offset the decline in electricity consumption of some customers, especially in Spain.

Within just a few years, Alpiq's Spanish subsidiary, Atel Energia S.A. (from March 2010, Alpiq Energia España S.A.), has established a name for itself as the most important alternative electricity supplier for end customers in the industrial and service sectors. And it has done so in a market that continues to be dominated by the traditional national energy utilities. Three years after entering the market, Atel Energia is already supplying 1,000 customers throughout the country and has more than doubled its workforce. One major new customer is the Barcelona underground transport authority. Atel Energia won the bid against some big-name competitors.

Spain: new office in Madrid

At the end of 2009, Alpiq took over EDF's Madrid-based sales company, Hispaelec, thereby expanding its leading position as an independent electricity supplier. Atel Energia and Hispaelec collectively sell more than three TWh of electricity per year. With the integration of Hispaelec to increase Atel Energia's geographical reach, customers are assured of optimal service from the two offices in Barcelona and Madrid.

The structure of the Spanish market changed last year. The main changes involved the takeover of Union Fenosa by Gas Natural and the abolition of all types of supply tariffs for industrial and service enterprises. On the procurement side, gas-fired combined cycle power stations played an increasingly important role in Spain's generation mix. Falling demand and increased output from wind and hydroelectric facilities resulted in a sharp drop in electricity prices compared to 2008.

France: regulatory uncertainty

In the French market, Alpiq (Alpiq Energie France SAS) successfully defended its position as a leading electricity supplier alongside EDF despite the difficult regulatory environment. A new market regime looks set to replace the current market organisation in January 2011, although state-regulated tariffs will remain. Due to this regulatory uncertainty, many customers are reluctant to sign new energy delivery contracts with alternative suppliers. However, with its prudent sales and hedging strategy, Alpiq has successfully addressed this risk. Alpiq Energie France delivered 10TWh of electricity to customers last year and won several tenders against strong competition.