The Tariff Revision Process is foreseen in the Concession Contract and considers changes in the company?s cost structure and its market, tariffs charged by similar companies, both domestic and international, as well as incentives to promote efficiency.

The Tariff Revision Process is divided in two steps. In the first one, denominated tariff readjustment, tariffs are set so as to cover efficient operational costs for a given level of quality in the rendered service ? and so as to guarantee a proper return on investments. The second step comprises the X Factor calculation, which translates in the establishment of productivity targets for the second tariff period.

The chart below presents the breakdown of the 2007 Tariff Revision for Escelsa:


EDP - Energias de Portugal, S.A.