MEFF To Manage Margins, Collections And Payments In Settlements On The Electricity Market For REE - REE Designates MEFF As Its Central Counterparty - The Volume Of Settlement Trades For The Adjustment Services Totals 1,600 Million Euros Per Annum - MEFF C

MEFF will manage the margins, collections and payments related to the new settlement functions assigned to REE, acting as central clearing counterparty on behalf of the Red Eléctrica de España (REE), under the agreement signed by the two companies. REE is the Operator of the System for the so called adjustment services in the electricity system, which affect producers, distributors and other agents in the market for producing electricity.

Under Article 22 of R.D.L. 5/2005, dated 11 March 2005, the new settlement functions assigned to REE are:

• The suppliers of “special” energies (energy under tertiary regulation, power band under secondary regulation, deviation management, etc.), in which the service suppliers participate and there are additional costs incurred with these services.
• Guarantee of power system.
• The deviations in the program of the daily and intraday market for electricity.

MEFF Central Clearing Counterparty

The functions assigned to MEFF consist of:

• The calculation, receipt and management of the margins that must be provided by the Agents of the Electricity Market.
• Settlement and communication of payments and collections related to the service of guaranteeing power supply.
• Settlement of payments and collections related to the effective deviations of the units of production and consumption in each period of programming.

The economic value of these settlement operations is in the order of 1,600 million euros per annum.

The broad based experience of MEFF as Central Clearing Counterparty for the options and futures exchange has been a significant factor in this decision. MEFF will calculate the margins to be deposited by each of the more than 200 agents in the electricity market and will manage possible non-payments.

In the futures and options exchange, MEFF is counterparty to the account holders in its Clearing House and its technology allows it to know, at all times, the risk carried on each of approximately 5,000 accounts currently open on the Exchange.

With this service for the electricity market, MEFF moves ahead in its strategy to consolidate positions in new markets for the future.

MEFF (www.meff.com) is the company that operates the Spanish financial futures and options exchange and its clearing house. In its advanced electronic trading system (S/MART) it offers futures and options on stock exchange indices and individual stocks, and bond futures. MEFF currently has 108 clearing and trading members. MEFF, AIAF, SENAF, the Spanish Stock Exchanges and IBERCLEAR together form BOLSAS Y MERCADOS ESPAÑOLES (BME).