Law 54/1997, of 27 November, of the electricity sector, establishes a new model where the production of electric power is developed in a free competition regime, based on a system of electric power offers. made by producers and a system of demands formulated by consumers who have the status of qualified persons, distributors and marketers.

The Royal Decree 2019/1997 of 26 December, for which the market for the production of electric power is organized and regulated, developed the model of operation of the production market that was contemplated in the Law, establishing as the only mode of contracting the electric power for the distributors the acquisition in the daily and intraday market of offers of electric power. The Royal Decree-Law 5/2005 of 11 March 2005 of urgent reforms for the boost to productivity and for the improvement of public procurement in its article twenty-second has amended Law 54/1997 of 27 November of the electricity sector, with to enable the creation of the Iberian Electricity Market (MIBEL), by extending the concept of the production market and by opening the possibility for distributors to acquire the energy for sale at tariff by means of the Bilateral procurement. To this end, it enables the Ministry of Industry, Tourism and Trade to regulate the participation of distributors in the bilateral procurement systems with physical delivery, as well as the mechanisms that promote efficient commercial management by part of these subjects. For its part, Royal Decree 1454/2005 of 2 December 2005 amending certain provisions relating to the electricity sector amends Royal Decree 2019/1997 of 26 December 1997 on the organisation and regulation of the production market for the adequacy of the new structure of the market for the production of electrical energy to the requirements of Royal Decree-Law 5/2005 of 11 March 2005 and the International Convention on the Establishment of an Iberian Market Electricity between the Kingdom of Spain and the Portuguese Republic of 1 October 2004. In this new framework, bilateral electricity contracts with physical delivery are regulated, including distributors as production market subjects who will be able to formalize these bilateral contracts with physical delivery of energy. The Ministry of Industry, Tourism and Trade is empowered to regulate the participation of distributors in these bilateral electricity contracts. The International Convention on the Establishment of an Iberian Electricity Market between the Kingdom of Spain and the Portuguese Republic of 1 October 2004 provides that the Parties shall promote the creation of a Market Operator Iberico (IMO), which will assume the functions of the Operator of the Iberian Polo Market (OMIP) and the Operator of the Spanish Polo Market (OMIE). OmIP together with the Sociedade de Compensação De Mercados De Energia (OMIClear) will act as corporate companies of the market in the term and OMIE as the society of the daily market. At the Hispano-Lusa summit held in Evora on 18 and 19 November, the Ministers of both countries agreed, in their will to continue with the creation of the MIBEL, that each country would publish the corresponding legal mechanism that would establish the the obligation for distributors to purchase on the market within the time limit managed by OMIP-OMIClear during the year 2006 5% of the energy sold to customers at tariff rates since 1 July 2006. In its virtue, I have:

Article 1. Object.

The purpose of this Order is to establish, for the transitional period of the second half of 2006, the obligations of distributors for the procurement of electricity in the market within the time limit managed by OMPI-OMIClear.

Article 2. Scope.

This Order will apply to electricity distributors with more than 100,000 customers under the general remuneration scheme established by Law 54/1997 of 27 November and subject to the procedure of (a) settlement of the costs of transport, distribution and marketing at tariff, of the permanent costs of the system and of the costs of diversification and security of supply as set out in Royal Decree 2017/1997 of 26 December 1997 that the winding-up proceedings are organised and regulated.

Article 3. Purchase obligation and participation rules in OMIP-OMIClear distributors in 2006.

1. From the date of entry into force of the Order and until 31 December 2006, the distributors to whom this Order applies will be obliged to purchase electricity in the market within the time limit managed by OMPI-OMIClear through purchase. of futures contracts with physical delivery in the auctions and conditions set out in the Annex.

2. For these purposes, the distributors referred to in the second article of this Order shall be entitled to participate in the market within the time limit managed by OMIP-OMIClear and to provide the guarantees required for their participation in the conditions established in this Order.

Article 4. Price to recognize the distributors in the liquidations of the National Energy Commission for the purchase obligation in OMIP-OMIClear in 2006.

For the calculation of the cost imputed by the energy acquisitions on the market in time for the sale at a tariff as set out in Article 3, the price to be considered for each distributor subject to the settlement procedure in the period for which they are determined, shall be the result of each auction corresponding to the trading session in which it is obliged to participate.

The General Directorate of Energy Policy and Mines is authorized to set limits on the offer price for the purchase of electric power by distributors by purchasing contracts for futures with physical delivery. in auctions as provided for in this Order. In addition, the costs arising from the provision of guarantees and the fees required for the participation in the market shall be recognised.

Article 5. Verification of compliance with the obligation in OMIP-OMIClear of distributors in 2006.

The National Energy Commission will verify compliance with the purchase obligation on the market within the time limit imposed on the distributors in the Annex.

Article 6. Breaches of the obligation in OMPI-OMIClear of distributors in 2006.

Without prejudice to the application of the sanctioning regime laid down in Law 54/1997 of 27 November 1997 on non-compliance with the obligations of the distributor, if the distributor does not acquire the entire electrical energy the price to be considered for the calculation of the cost charged for the defect or excess of energy acquired shall be 70% of the corresponding price defined in the Article 1 or exceeds the price charged for the purchase obligation imposed in Article 1 or exceeds that obligation. previous.

The penalties provided for in the preceding paragraph shall not apply in the event that the distributor has made demands for contracts in accordance with the provisions of this Order that would not have been married.

Single additional disposition. Exemption for the assimilation of regulated offers in Royal Decree-Law 3/2006 of 24 February.

To the offers of energy acquisition in the daily market of the distribution companies, derived from the purchase obligations imposed in this Order, the procedure of assimilation of offers will not apply to them. regulated in Royal Decree-Law 3/2006 of 24 February, amending the mechanism of appeal of the offers of sale and purchase of energy submitted simultaneously to the daily market and intra-day production by subject matter of the sector electrical equipment belonging to the same business group.

Single transient arrangement. Authorisation to the Operator of the Iberian Energy Market, S. A. (OMIE), to establish procedures to allow the physical delivery associated with futures contracts negotiated in the market within the time frame managed by OMP-OMIClear.

As long as the adaptation of the Resolution of 24 May 2006, of the General Secretariat of Energy, by which the Rules of operation of the daily market and intra-day of production of electrical energy are approved, is not carried out In this provision, OMIE is authorised to establish procedures to enable the physical delivery of electrical energy associated with open positions in futures contracts traded on the managed-term market by OMIP-OMIClear, in accordance with the following principles: 1. OMIP-OMIClear shall communicate to OMIE the positions in the daily market resulting from the physical delivery of energy associated with open positions in the forward market of each term contracting unit, indicating to which market operator correspond. This communication shall be carried out at least two days in advance of its incorporation into the daily market.

2. The daily market players shall communicate to OMIE the breakdown of the above positions, indicating which units of sale or purchase of the daily market correspond. The tenders corresponding to those sales or acquisition units shall be incorporated at an instrumental price in the supply and demand curves of the daily market. 3. OMIE will incorporate in the appropriate Instruction the technical development of the mentioned procedures established under this transitional provision and inform the market agents, by the usual means of advertising, as well as to the National Energy Commission and the Ministry of Industry Tourism and Trade. Within 15 days of the publication of this Order, OMIE shall submit to the Ministry of Industry, Tourism and Trade a proposal to amend the Rules of Procedure of the Market incorporating those procedures.

Single end disposition. Entry into force.

This Order shall enter into force on the day following that of its publication in the "Official Gazette of the State" and shall apply until 31 December 2006.

Madrid, June 30, 2006. -Minister of Industry, Tourism and Trade, José Montilla Aguilera.

ANNEX Purchase Obligations in OMIP-OMICLEAR from Distributors in 2006

As of 1 July 2006 and during the second half of the year, the distributors listed below will be required to contract electrical energy in the OMPI-OMIClear managed term market through the conclusion of futures contracts with physical delivery in the amount indicated in the following tables, for each of the delivery periods that are set, and at the auctions indicated.

An image appears in the original. See the PDF document for this disposition.

Each contract is equivalent to the delivery of 1MWh in base load, in each of the 24 hours of the days corresponding to the delivery period. In case the days indicated in the above tables were not days of negotiation of the market within the deadline managed by OMIP-OMIClear the acquisition of the contracts will be realized the next day of negotiation