Message from the Chairman of the Board of Directors

“Being the world’s third largest
wind energy producer, we deliver
sustainable development:
economic, social and
environmental. We combine
operational and financial growth
with investment in the society
and respect for the environment.”

Dear stakeholders,

I’m pleased to report that your company has delivered a resilient performance in a complex business environment. Against a backdrop of low energy prices, unstable financial markets combined with high currency volatility and increased regulatory uncertainty, EDPR executed and delivered on the highest expectations of the Board of Directors. This year’s results were obtained in a highly unpredictable economic environment and reflect EDPR’s solid and balanced portfolio. Our existing asset base of 7.5 GW of wind energy capacity delivered outstanding operating metrics evidencing our capabilities and core competences in developing and operating wind farms.

2011 contributed profoundly to the belief that renewable energies will play an undeniable role in the energy sector. On the one hand, the terrible nuclear tragedy caused by the earthquake in Japan brought light to the safety component of energy, something that was not considered by many as a primary goal in itself, and as a result many countries redefined their energy policies and started applying more demanding safety standards. Additionally, in the 2011 UN Climate Change Conference, several positive signs pointed to the commitment towards a single global agreement by 2015 and also to the extension of the Kyoto Protocol.

In line with this mindset shift, I strongly believe in the benefits of a well balanced generation mix, supported on mature technologies. Wind already provides this assurance and is also a proven solution for economic growth, job creation and safer and cleaner energy. The temporary moratorium in Spain and current discussion on tax benefits extension in the US creates a potential growth challenge for EDPR in 2013, albeit the long-term commitments remained unchanged. EDPR, diversified in 11 geographies, expects that positive visibility regarding wind energy will come sooner rather than later.
We continued working on new growth options, balancing regulatory and technological risk, and signed a new partnership for the development of up to 2.4 GW of offshore wind in the UK.

In the end of 2011, EDP signed a strategic partnership agreement with China Three Gorges – the biggest clean energy company in China – with a strong focus on renewable projects. The partnership, in what EDPR is concerned, comprises a direct investment from CTG in minority stakes in some of EDPR’s wind farms and the joint development of selected renewable projects. The partnership is designed to maximize the value creation from a worldwide growth platform in renewable energy development and will shape the growth prospects of EDPR. Soon, we will announce the 2015 business plan, with the full scope of the new strategic partnership.

EDPR Board of Directors is committed to achieve the highest standards of corporate governance and ethical business conduct and also to align its structure with the company’s business profile. In 2011, the Board concluded its first mandate and there was a deeper integration between the Board and EDPR’s management team with the full incorporation of its members in the Board. In February 2012, Mr. João Manso Neto succeeded Mrs. Ana Maria Fernandes as EDPR’s CEO. João Manso Neto has been an Executive Director of EDPR since 2008 and member of EDP Executive Board of Directors since 2006. He has a deep knowledge of the Company and I wish him all the success in this new journey. I would also like to thank Ana Maria Fernandes for her commitment to the interests of EDPR’s shareholders during the last three years and wish her good luck in her new responsibilities in EDP Brasil.

I would like also to thank the effort of our employees for their contribution and commitment. The Company continues to invest in human resources and in the development of our people, making sure it is motivated to transform new challenges into new opportunities while engaging with all our stakeholders in the different activities of EDPR. The way the Company develops and operates its wind farms and its 16.8 TWh of clean, CO2-free electricity generated are decisive contributors for EDP Group worldwide leadership position in sustainability.

Being the world’s third largest wind energy producer, we deliver sustainable development: economic, social and environmental. We combine operational and financial growth with investment in the society and respect for the environment. With these principles, EDPR will continue to lead the way.

António Mexia
Chairman of the Board of Directors