Business

The ERG Group operates in the renewable energy source segment through ERG Renew, a company which, at 31 March 2012, was its wholly owned subsidiary as a result of the takeover bid that ended on 7 June 2011 with the consequent delisting of the subsidiary.
The performance of ERG Renew is based mainly on the wind power generation business. Wind farms consist of wind-power generators that can transform the kinetic energy of wind into mechanical energy, which is used in turn to generate electricity.

The Group’s net installed capacity at 31 March 2012 was 552 MW and it is nearly entirely provided by wind farms (about 1 MW by the new photovoltaic plant installed at the industrial site of ISAB Energy at Priolo Gargallo). The ERG Renew Group is active in the following businesses:

Wind Italy: ERG Renew operates in the sector of the generation of electricity from renewable sources with 488 MW of wind power in operation.
The considerable increase in power that took place in 2011 is due mainly to the completion of the Fossa del Lupo wind farm, in operation since 1 July 2011, with 97.5 MW of power and to the acquisition of ERG Eolica Campania, with 111.8 MW of installed power. ERG Renew is also completing the wind farm in Ginestra (40 MW, of which 32 MW already in operation as at 31 December 2011), and in the second half of September it started work for the construction of the wind farm in Amaroni (22.5 MW), expected to start production by the end of 2012.

Wind France: via its subsidiary ERG Eolienne France S.a.s., ERG Renew generates electricity from wind sources. There are currently 6 facilities with a total installed capacity of 64.4 MW, including 9.2 MW pertaining to the Plogastel wind farm, which came into commercial operation at the end of April 2010. ERG Eolienne France also executed a memorandum of understanding for the future acquisition of the company Eoliennes de Greneville, set up to build a wind farm south of Paris with capacity of 20 MW.

Wind Eastern Europe: through LukErg Renew, the equal-share joint venture with LUKOIL, operates mainly in the Eastern European areas where it that will initially be focused on Bulgaria and Romania, countries that have high development potential. The goal is to build up, in the medium term, a geographically and technologically balanced asset portfolio.

Photovoltaics: ERG Renew plans to diversify its presence in the field of renewable energy by also focusing on photovoltaics. ERG Renew is participating in a next generation solar power (so-called organic photovoltaics) research and development project, in partnership with Permasteelisa, Dyesol and some of the Italian universities. Moreover, the Company installed a traditional plant at ISAB Energy's Sicilian industrial site in Priolo Gargallo (Syracuse) with a capacity of approximately 1 MW, come on stream at the end of June 2011.