Abu Dhabi Annual Report 2011 Electricity and Water

ANNUaL REPORT
For the water, wastewater and electricity sector in the Emirate of Abu Dhabi
2011
We regulate the water, wastewater and electricity industries in the Emirate of Abu Dhabi in the United Arab Emirates. We enforce relevant laws through the licensing of the companies who undertake regulated activities in these industries. Regulated activities include: generation, transmission, distribution and sale of electricity; production, transmission, distribution and sale of water; and collection, treatment and disposal of wastewater. Once a licence is issued, we monitor activities, produce and modify regulations where needed and enforce the conditions of the licences. We establish and monitor technical performance, safety and customer standards. We also oversee industry restructuring and have the power to approve mergers and acquisitions.
Printed on 100% environment-friendly paper FSC & PEFC Certied - 100% Natural Annual Report 2011 | The Abu Dhabi Regulation & Supervision Bureau
Contents
01 03 05 07 09 10 13 15 17 21 26 28 30 Chairmans message 2011 timeline Performance highlights Helping sector customers Protecting people and the environment Going greener Supporting growth Sector governance and Board of Directors Licence holders Public record of activities and documents Consultants Growth and production charts Financial statements
Annual Report 2011 |
The Abu Dhabi Regulation & Supervision Bureau
Chairman's message
Abu Dhabis water, wastewater and electricity sectors continued their rapid development in 2011.
The past year saw a major focus on customer service initiatives, such as the billing of water in litres rather than gallons, and the establishment of two key Regulation and Supervision Bureau Offices - Waterwise and Powerwise - to promote the efficient use of water and electricity amongst nal users. In conjunction with these initiatives, the Bureau has been working with the two distribution companies - the Abu Dhabi Distribution Company (ADDC) and the Al Ain Distribution Company (AADC) - to design new water and electricity bills. The new bills, which provide more information on consumption and detail the level of Government subsidy each customer is receiving, were launched in early 2012. Other key focus areas have included work on potential nuclear power connections and associated regulatory operating standards, as well as the initial development of a nuclear power generation licence. Renewable energy is also a key area of interest to us and we have been working with Masdar (the Abu Dhabi Future Energy Company) to study embedded solar roof-top installations in order to develop a better understanding of their operation. This research will allow the Bureau to recommend special tariffs to the Government that will support the further development of clean energy in the Emirate. Finally, we have continued to undertake a comprehensive range of regulatory activities, all of which aim to promote the Abu Dhabi Sector as one of the best in class in the region. To explain these developments further, as well as to highlight various other achievements during the past year, we are pleased to present our 2011 Annual Report. Mohammed Ahmed Al Bowardi
The past year saw a major focus on customer service initiatives.
2011 timeline
January
Full commercial availability of Fujairah F2
F2, the Independent Water and Power Producer (IWPP) located in Qidfa (Fujairah) becomes fully operational. Fujairah Asia Power Company is licensed to produce up to 2,000 MW* of electricity and 130 MIGD* of water. [p.13]
September
Bureau appointed Sector Regulatory Authority (SRA) for the Wastewater Sector
As SRA we set out to enhance our inuence in the health, safety and environmental performance of the Sector. [p.9]
April
October
Launch of Waterwise
Waterwise is established to champion water efficiency and promote the wise use of water in the Emirate. [p.12]
Start of phase 2 of the GCC grid interconnection project

The second phase becomes operational with the link of Al Sila station in the UAE to Salwa station in the Kingdom of Saudi Arabia. [p.13]
Launch of the Oman-UAE power grid interconnection

The interconnection is designed to support electricity transfer of up to 200 MW. [p.14]
Al Saad becomes the rst Independent Sewage Treatment Plant to begin commissioning with wastewater
The plant will contribute an additional 80,000 m3/day treatment capacity to the Al Ain region. [p.13]
November
Launch of Powerwise
Powerwise is established to support and advocate the effective energy management in the Emirate. [p.12]
Licensing of an Independent Power Producer

Shuweihat Asia Power Company is granted a licence for its power-only plant at Shuweihat (S3) to generate up to 1,600 MW of electricity.
Regulatory Policy Statement on electricity and water costs

The policy statement sets out how we calculate the actual unit costs of electricity and water.
MW = megawatt; m3/d= cubic metre per day MIGD = million imperial gallons per day
Powerwise and Waterwise focus on promoting the sustainable use of electricity and drinking water.
Performance highlights
2011 Sector annual production
+13%
Electricity
Electricity
Water (potable)
56,576 GWh
+6.5% 4,168
1,052,572 ML
Installed capacity
13,849
Electricity
Water (potable)
MW MLD
System peak demand (includes exports to other Emirates)
+11.4% +1.9%
Hourly peak: 9,749 MW, +13.9% (15 August 2011). Includes exports of 1,900 MW. Hourly peak for the Emirate of Abu Dhabi: 7,849 MW
+0.5%
Water supply
Transmission peak: 3,034.4 MLD (19 October 2011) Includes Northern Emirates demand
Wastewater treatment
683,000 m3/d average, received at wastewater treatment plants

Note: the percentage increases are as compared with the previous year, however in the case of water supply, this is an increase on audited gures which were not available at the time of issuing our 2010 Annual Report. TRANSCOs audited gure for 2010 was 664.4 MIGD (08/06/2010) MW = megawatt; GWh = gigawatt hour ML = million litres; MLD = million litres per day; m3/d = cubic metre per day
Customers
405,284 280,602
Electricity
Electricity
+9.2%
294,589
Water supply
+6.5%
Wastewater treatment
(estimated)
Average unit costs
Sector turnover
28.8
Water
ls/kWh
10,213 8,352 1,644

Water
Electricity
AED million
AED per unit (Unit =1,000 litres or 1 m3)
10.43
AED million
Wastewater
AED million
Water quality
Total tests
+4% 191,682
for 76 parameters
Helping sector customers

2011 has seen signicant progress towards meeting a growing demand for water, electricity and wastewater services in the Emirate.
Protecting customers interests
In order to better serve customers interests, the Bureau commissioned a number of surveys to determine the awareness, satisfaction and expectations of users in relation to the services they receive from the two distribution companies (ADDC, AADC) and the Abu Dhabi Sewerage Services Company (ADSSC). Customer awareness regarding the two water and electricity providers (ADDC and AADC) is high in both Abu Dhabi and Al Ain. The services that residents of both cities are most familiar with include: online bill payments and consumption history facilities offered via the e-services website; 24-hour emergency services; new water and electricity connections; and 24-hour access to customer contact centres. The level of customer satisfaction with the services of both distribution companies is high - 92 percent for ADDC and 79 percent for AADC. Feedback concerning ADSSC varied between Al Ain and Abu Dhabi, and according to whether the respondents were industrial, commercial or residential customers. Overall awareness of the various sewerage services provided by ADSSC was found to be relatively low - particularly in Al Ain, where 69 percent of industrial and commercial customers surveyed were unaware of the companys services. Customer awareness was most widespread regarding the provision of recycled water to municipalities for watering parks and gardens. Overall, two-thirds of those customers surveyed who had dealt with ADSSC were satised with the standard of services provided.
Progressing compliance with wastewater regulations

In 2011, the Bureau delivered a number of initiatives to support the implementation of the Trade Effluent Control Regulations and the Recycled Water and Bio-solids Regulations. The former dene certain classes of trade effluent as low-risk - in that they are typically of low ow and strength and pose only a limited risk to the receiving sewerage or treatment system. This mitigates some of the effort and cost involved in issuing and monitoring consents for certain classes of trade effluent, which can often impose an unreasonable regulatory burden on licensees and trade effluent dischargers.
Building on these regulations, we also worked with a range of government organisations and sewerage service licensees to develop two codes of practice (CoPs) for managing low-risk trade effluent discharges specically from restaurants and laundry services. The CoPs dene the minimum requirements for managing discharges from these premises and establish the roles and responsibilities of licensees, restaurant owners and laundry operators. They also reect good international practice and existing regulatory requirements in Abu Dhabi. Regulation is a dynamic process and underlying legal frameworks must be kept under review to encourage innovative, economic and the safe management of regulated activities. Accordingly, we established a wastewater regulations review panel to advise on wastewater regulation issues, comprising expert stakeholders drawn from 14 organisations, including government departments and wastewater licence holders.
These new arrangements simplify wholesale charges, setting relatively high prices during the day in the summer months and much lower prices at other times, consistent with the sectors underlying costs.
Water quality inspection project

The Water Supply Regulations (2009) include provisions to ensure the safety of potable water supplies contained in storage facilities and tanks, including ground/roof containers as well as those carried by road vehicles. A water quality inspection project undertaken in 2011 involved a sampling process conducted at a number of small and large installations to determine the effectiveness of the Regulations. The sampling and testing scheme was conducted at 500 separate customer storage facilities in the Emirate of Abu Dhabi, monitoring the quality of drinking water supplies in co-ordination with the distribution companies, the Municipalities of Abu Dhabi, the Western Region and Al Ain, the Health Authority Abu Dhabi (HAAD) and the Abu Dhabi Food Control Authority (ADFCA). In total, 7,560 tests were carried out to determine 15 separate water quality parameters in 504 water samples. Excluding chlorine tests, the results showed that 99.1 percent parameter tests carried out conrmed that the samples complied with the standards set in the Water Quality Regulations (2009).
Changes to industry charging arrangements

In 2011, the Bureau approved a new structure for Bulk Supply and Large User Tariffs. The Bulk Supply Tariff (BST) is the charge that the Abu Dhabi Water and Electricity Company (ADWEC) levies on the distribution companies for the provision of wholesale supplies of electricity and water.
Protecting people and the environment

Ensuring Health, Safety and Environment (HSE) standards across the water, wastewater and electricity sectors in Abu Dhabi is an important part of our work. The Bureau was also nominated as the Sector Regulatory Authority (SRA) for the Wastewater Sector in September 2011. This is a new and complementary responsibility for us.
Health and safety reviews
The Bureau completed Health & Safety (H&S) reviews of both distribution companies, comprising assessments of the companies H&S management systems using interviews and site-based verication. The reviews also involved root cause analyses of seven H&S-related incidents for each company, as well as assessments of the companies Safety Management Systems maturity in light of good health and safety best practices for the construction, power and water sectors. The nal review provided recommendations and an action plan which was agreed with the companies to improve their performance in this area. to manage contractor H&S performance more effectively. As a result, we have introduced a two-tier monitoring system for licence holders which reects the size and nature of their operations.
Regulating the wastewater sector

Also in 2011, the Abu Dhabi EHSMS Higher Committee nominated the Bureau as the Sector Regulatory Authority (SRA) for the Wastewater Sector. The EHSMS framework is being implemented across the Emirate, and this is a new responsibility. As an SRA the Bureaus inuence on the health, safety and environmental performance of the Sector will be enhanced, allowing it to use its expertise to inuence HSE more broadly within the Emirate. This will enable us to build on previous co-operation with our licence holders to encourage best practice and further reduce incidents.
Health and safety consultation

We launched a health and safety framework consultation process in order to apply improvements identied both as a result of the H&S reviews undertaken for the network companies and the development of the Abu Dhabi Environment, Health and Safety Management System (EHSMS). The consultation document considered how
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Going greener
The Emirate of Abu Dhabi ultimately seeks to derive 30 percent of its electricity capacity from low-carbon sources, with at least seven percent being met by renewable energies. In doing so, the Government aims to reduce Abu Dhabis carbon dioxide emissions by 30 million tonnes per year.
We are actively working to support the sector to achieve these targets by facilitating the licensing process, evaluating the impact of the integration of alternative energy sources, and introducing amendments to current regulatory policies to accommodate the projected mix of generation types. As a result, the alternative energy sector is witnessing considerable activity in the Emirate, and signicant progress towards achieving the Governments targets was achieved during the year. Masdars pilot solar rooftop programme, launched to test the effectiveness of rooftop photovoltaic (PV) cells in Abu Dhabi Emirate, achieved its target installation of more than 2 MW of solar PV cells on eleven government-owned buildings connected to ADDC network in Abu Dhabi during the year. Stakeholders in this project, including a team from the Bureau, are currently monitoring and evaluating the operational performance of this pilot scheme. Meanwhile, the 10 MW photovoltaic Masdar City Solar Power Plant, which is one of ve projects in the UAE registered for carbon credits under the United Nations Clean Development Mechanism (CDM), entered its third year of operation in June 2011. In its rst two years, the plant generated approximately 36,000 MWh of clean energy and saved 24,000 tonnes of CO2 emissions - the equivalent of taking 3,300 cars off Abu Dhabis roads. The plant is a net exporter of energy to the grid, to which it supplies power after meeting the energy needs of the Masdar Institute of Science and Technology (MIST).
Solar energy projects

Construction at Shams 1 was well underway during 2011, having begun in the third quarter of 2010. This development is one of the worlds largest concentrated solar power (CSP) projects and the rst of its kind in the Middle East, covering an area of 2.5 km, with a capacity of approximately 100 MW and a solar eld consisting of 768 parabolic trough collectors. The project reached nancial close in March 2011 and is on target for completion by Q4 2012.
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Annual Report 2011 | The Abu Dhabi Regulation & Supervision Bureau
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A low-carbon pioneer
Abu Dhabi governments low-carbon initiative has not only helped the sector to gain valuable experience through establishing the aforementioned industrial-scale alternative energy technologies, the process has and will also continue to provide the real data about these new technologies. This real data is invaluable in making informed decisions as to the most appropriate and effective means of attaining Abu Dhabis target of deriving seven percent of its energy supply from renewables. As a result of these activities, Abu Dhabi is now recognised as one of the world leaders in low-carbon energy advancements.
The War Offices
In order to promote more efficient energy and water use in the Emirate, two new offices opened under the direction of the Bureau in 2011. Known as the War Offices (War in Arabic means save), their aim is to support the Abu Dhabi Governments commitment to resource sustainability by helping customers use electricity and water wisely and thereby conserving energy. These offices, known as Powerwise and Waterwise, focus on promoting the sustainable use of electricity and drinking water for nal users of these products and aim to build a comprehensive knowledge base to support key decision makers and strengthen the Emirates ability to achieve greater efficiency.
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Supporting growth
By the end of 2011, the Bureau was responsible for the regulation and supervision of 35 licences in the water, wastewater and electricity sectors in Abu Dhabi.
Commissioning of Independent Sewage Treatment Plants (ISTPs)
The Independent Sewage Treatment Plants (ISTPs) at Al Saad in Al Ain and Al Wathba near Abu Dhabi began nal commissioning. These new plants will eventually replace and extend existing wastewater treatment capacity in the Emirate. Located in Jebel Dhana, near Shuweihat, 250 km west of the city of Abu Dhabi, Shuweihat S2 is an IWPP owned by Ruwais Power Company (RPC). The plant was also developed as a greeneld power generation and seawater desalination plant and is licensed by the Bureau to produce up to 1,511 MW of power and 100 million gallons of desalinated water per day (MGD). The additional capacity added as a result of S2 has increased total sector electricity generation capacity to 13,849 MW, and water production capacity to 915 MGD [4,168 MLD]. We also licensed an additional 4,180 m3/d of wastewater treatment capacity in Al Ain, Reem Island, Ruwais and Taweelah during 2011. These relatively small sewerage facilities provide an essential service at two labour camps, one mixed-use development and a new adventure water park. In all four cases the recycled water will be reused to irrigate the landscaped areas at the sites.
Additional water and electricity capacity

In January, the Independent Water and Power Producer (IWPP) F2 became commercially operational. The plant, located in Qidfa, in the Emirate of Fujairah, is owned by Fujairah Asia Power Company PJSC (FAPCo) is a greeneld power generation and seawater desalination plant. It is licensed to produce up to 2,000 MW of power and 130 MIGD [600 MLD] of water. The Fujairah F2 project complements the existing F1 plant owned by Emirates Sembcorp Water and Power Company in the same area. Both plants provide a major contribution to the Sectors available power and water production capacity as well as supporting the Northern Emirates increased power and water demands. The Shuweihat (S2) plant achieved full operational capacity on 18 October 2011.
The GCC interconnection (GCCI)

Further enhancements to Abu Dhabis infrastructure have been realised via the Gulf Co-operation Council Interconnection (GCCI). In April 2011, the 400 kV system of the Abu Dhabi Transmission and Despatch Company (TRANSCO) and the GCC Interconnection Authority (GCCIA)
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network (which includes Saudi Arabia, Kuwait, Bahrain and Qatar) were successfully synchronised through the connection of a double circuit 400 kV overhead transmission line between the grid stations at Sila and Shuweihat in the Western Region of Abu Dhabi.
In 2011, the Bureau began its threeyear chairmanship of the Regulatory and Advisory Committee, which was developed to regulate the business of the GCCIA. We have also been involved in an extensive review of the interconnection, examining technical codes and commercial arrangements to ensure compliance with sector legislation.
IRAQ
KUWAIT
Al Zour
GCC Interconnection UAE System (ENG)
Arabian Gulf
Al Fadhili
IRAN
BAHRAIN
Jasra Ghunan
OMAN
QATAR
Doha
SAUDI ARABIA
Salwa Shuwaihat
Al Ouhah
Gulf of Oman
Al Wasset
UNITED ARAB EMIRATES
OMAN
The GCC interconnection grid
The UAE-Oman interconnection

On 3 October 2011, a high voltage link between the UAE and Oman was synchronised for the rst time. The interconnection is designed to support electricity transfers of up to 200 MW. This successful connection follows the signing of a power sales purchase agreement between ADWEC and the Oman Power and Water Procurement Company.
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Sector governance and Board of Directors
Governing sector law

The governing law for the water, wastewater and electricity sector is Law No (2) of 1998 Concerning the Regulation of the Water and Electricity Sector in the Emirate of Abu Dhabi, as amended. Among other things, this law established the Bureau and sets outs its powers and duties. There have been no amendments to Law No (2) during 2011.
Board of Directors
The Bureaus Board of Directors was appointed by His Highness Sheikh Mohammed Bin Zayed Al Nahyan on April 9, 2008, consisting of: H.E. Mohammed Ahmed Al Bowardi H.E. Hamad Al Hurr Al Suwaidi H.E. Mohammed Abdullah Bin Sahoo Al Suwaidi H.E. Falah Mohammed Al Ahbabi Mr Ibrahim Mubaydeen
ADSSC establishing law

Law No (17) of 2005 concerning the establishment of the Abu Dhabi Sewerage Services Company (ADSSC), as amended, is also an important Sector law. It established ADSSC and enables ADSSC to connect other sewerage services providers that are licensed by the Bureau to ADSSCs network. There have been no amendments to Law No (17) during 2011.
Regulations
Under Law No (2), the Bureau has the power to establish regulations for a number of purposes, such as to protect the public from danger related to water, electricity or wastewater installations.
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The Bureaus Board of Directors was appointed by His Highness Sheikh Mohammed Bin Zayed Al Nahyan on April 9, 2008.
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Licence holders
We grant licences to Persons (undertakings, companies, organisations) to carry out certain activities. Collectively these Persons are known as licence holders. Licences confer rights and obligations on a licence holder in order for them to undertake regulated activities. Our primary annual funding is derived from licence holders via the application of fees.
Generation and desalination
Al Mirfa Power Company (AMPC) operates three power stations at Al Mirfa, Madinat Zayed and Al Ain with a total licensed capacity of 636 MW. Water production of up to 38.7 MGD is at the Al Mirfa station only. Arabian Power Company (APC) is licensed to generate 2,200 MW and produce 160 MGD of water at its Sass Al Nakheel plant. Emirates CMS Power Company (ECPC) (T2) with licensed capacities of 763 MW and 50 MGD of water at Taweelah. Emirates Sembcorp Water and Power Company (Sembcorp) (F1) licensed to produce 861 MW and 100 MGD of water at its plant located at Qidfa in Fujairah, one of the Northern Emirates of the UAE. Fujairah Asia Power Company (FAPCO) (F2) is situated at the Qidfa complex in Fujairah and licensed to produce 2,000 MW and 130 MGD of water. Gulf Total Tractebel Power Company (GTTPC) (T1) with licensed capacities of 1,600 MW and 84.8 MGD of water at Taweelah.
Ruwais Power Company (RPC) (S2) with licensed capacities of 1,511 MW and 100 MGD of water at Shuweihat in the Western Region. Shuweihat Asia Power Company (SAPCO) (S3) with a licensed capacity of 1,600 MW at Shuweihat - currently under construction. Shuweihat CMS International Power Company (SCIPCO) (S1) with licensed capacities of 1,500 MW and 100 MGD of water at Shuweihat. Taweelah Asia Power Company (TAPCO) (T3) with licensed capacities of 160 MGD of water and 2,000 MW at Taweelah. Tourism Development and Investment Company PJSC (TDIC) has a licence to extract and desalinate seawater for nonpotable (2.2 MGD) and potable water (0.88 MGD) purposes on Saadiyat Island. Umm Al Nar Power Company (UANPC) owns Baniyas power station with a licensed capacity of 120 MW, currently not in production.
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Generation - renewable energy

Abu Dhabi Future Energy Company (ADFEC or Masdar) is licensed to produce up to 40 MW of electricity by Embedded Generation Unit(s) using wind turbines located in the Western Region. ADFECs rst wind turbine, on Sir Bani Yas Island, has a capacity of 850 kW. ADFEC is also licensed to produce up to 50 MW of electricity from solar power generation in the Emirate of Abu Dhabi. Shams Power Company PJSC is licensed to generate electricity by the use of a solar thermal plant up to 110 MW at a site south of Madinat Zayed in the Western Region.
Distribution and supply

Abu Dhabi Distribution Company (ADDC) distributes and supplies water to approximately 224,000 customers and electricity to around 282,000 customers in the central and western regions of the Emirate of Abu Dhabi. Al Ain Distribution Company (AADC) distributes and supplies water to approximately 71,000 customers and electricity to around 123,000 customers in the eastern region of the Emirate of Abu Dhabi.
Multi-licensed
Abu Dhabi Company for Servicing Remote Areas (RASCO) is licensed to generate, desalinate, transmit, distribute and sell electricity and water in remote areas, not connected to either of the distribution networks.
Self-Supply Licence
Emirates Aluminium Company Limited PJSC (EMAL) has a self-supply licence for desalination of water and generation of electricity at the EMAL Aluminium Smelter Development in Taweelah. Electricity generation in excess of self-supply requirements may be offered for sale to ADWEC, the sectors single buyer.
Procurement
Abu Dhabi Water and Electricity Company (ADWEC) is the single buyer of water and electricity output and capacity from producers under various Power and Water Purchase Agreements and charges the distribution companies for water and electricity, under a Bulk Supply Tariff.
Transmission
Abu Dhabi Transmission and Despatch Company (TRANSCO) is responsible for all transmission voltages at 400, 220 and 132 kV including despatch of generation units, water balancing and the bulk movement of water throughout the Emirate.
Wastewater - major licences

Abu Dhabi Sewerage Services Company (ADSSC) is responsible for the collection, treatment and disposal of wastewater throughout the Emirate of Abu Dhabi.
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Licence holders (continued)
Al Etihad Biwater Waste Water Company, (W1) is licensed to treat wastewater at Al Wathba-Abu Dhabi (up to 345,000 m3/d) and at Al Saad-Al Ain (up to 92,000 m3/d). Al Wathba Veolia Besix Waste Water Company, (W2) is licensed to treat wastewater at Al Wathba-Abu Dhabi (up to 300,000 m3/d) and at Alhamah-Al Ain (up to 130,000 m3/d). Higher Corporation for Specialized Economic Zones (ZonesCorp) is licensed to collect, treat and dispose of up to 40,000 m3/d of wastewater at the Industrial City - Abu Dhabi (ICAD).
Hyundai Engineering and Construction Ltd is licensed to collect, treat and dispose of 1,000 m3/d of wastewater at its labour camp in the Khalifa Port Industrial Zone (KPIZ). Hyundai Engineering and Construction Ltd is licensed to collect, treat and dispose of 1,960 m3/d of wastewater at the Braka Nuclear Power Plant. Manazel Real Estate PJSC is licensed to collect, treat and dispose of 1,000 m3/d of wastewater on the Al Reef Villas Development in Shahama. Samsung Corporation is licensed to collect, treat and dispose of 500 m3/d of wastewater at two labour camps serving the construction of the S2 power plant in Ruwais. Sorouh Real Estate Company PJSC is licensed to collect, treat and dispose of 2,120 m3/d of wastewater on Reem Island. Tourism Development and Investment Company PJSC (TDIC) is licensed to collect, treat and dispose of 620 m3/d of wastewater at its Qasr Al Sarab desert resort near Hameem in the Western Region.
Wastewater - small scale

Abu Dhabi Future Energy Company (ADFEC) is licensed to collect, treat and dispose of 1,500 m3/d of wastewater at the Masdar City Development. Al Tamouh Investments Company LLC is licensed to collect, treat and dispose of 50 m3/d of wastewater at its White Water rafting Centre at Jebel Hafeet, Al Ain. ALDAR Properties PJSC is licensed to collect, treat and dispose of 9,000 m3/d of wastewater on Yas Island. Emirates Aluminium Company Limited PJSC (EMAL) is licensed to collect, treat and dispose of 700 m3/d of wastewater at the EMAL aluminium smelter site in Taweelah.
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FAPCO ECPC SEMBCORP TAPCO GTTPC
APC SCIPCO AMPC RPC SAPCO TAWEELAH
T3 T1 T2
DHAID
F1 F2
DUBAI
ABU DHABI
S1 S2
JEBAL DHANA
S3
M
AL MIRFA
AL AIN
LIWA
New plant (Under construction)
Location of large scale licensed generation and desalination companies
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Public record of activities and documents

In law we have a duty to maintain a Public Register. This section of our Annual Report is constructed so as to list documents which are part of our Public Register. For the purpose of satisfying the law we maintain our Public Register using our website, where all Public Register documents are available for free view and download.
Licensing
New licences
28 Apr 2011 Shuweihat Asia Power Company (SAPCO) ED/L01/026 Electricity generation 10 Feb 2011 Hyundai Engineering and Construction Ltd ED/L07/009 Sewerage, wastewater treatment and disposal 15 Feb 2011 Sorouh Real Estate Company PJSC ED/L07/010 Sewerage, wastewater treatment and disposal 19 Jul 2011 Al Tamouh Investments Company LLC ED/L07/011 Sewerage, wastewater treatment and disposal 1 Oct 2011 Hyundai Engineering and Construction Ltd ED/L07/012 Sewerage, wastewater treatment and disposal
Modications
Modications to a licence are made subject to agreement by the appropriate licence holder. 11 Jan 2011 Shams One Company LLC ED/L01/025 Renamed Shams Power Company PJSC 4 Mar 2011 Tourism Development and Investment Company (TDIC) ED/L07/004 Extended Licence duration by 24 months and reduced capacity 17 May 2011 Abu Dhabi Water and Electricity Company (ADWEC) ED/L01/006 Single Buyer
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Al Ain Distribution Company (AADC) ED/L01/007 31 May 2011 Water and Electricity Distribution and Supply Abu Dhabi Distribution Company (ADDC) ED/L01/008 1 Jun 2011 Water and Electricity Distribution and Supply
Derogations
Derogations are issued by the Bureau to a licensed operator for a period and on terms specied in the derogation, from the performance of particular licence conditions. Abu Dhabi Water and Electricity Company (ADWEC) ED/L06/011 7 Mar 2011 Maximum Allowed Revenues for 2011 for the Electricity and Water Procurement Businesses Abu Dhabi Transmission and Despatch Company (TRANSCO) ED/L06/012 7 Mar 2011 Maximum Allowed Revenues for 2011 for the Electricity and Water Transmission Businesses Abu Dhabi Sewerage Services Company (ADSSC) ED/L06/013 7 Mar 2011 Maximum Allowed Revenues for 2011 for the Sewerage Services Business Abu Dhabi Distribution Company (ADDC) ED/L06/014 7 Mar 2011 Maximum Allowed Revenues for 2011 for the Supply Business Al Ain Distribution Company (AADC) ED/L06/015 7 Mar 2011 Maximum Allowed Revenues for 2011 for the Supply Business Abu Dhabi Transmission and Despatch Company (TRANSCO) ED/L06/016 April 2011 Maximum Allowed Revenues for 2010 for the Water Transmission Business Abu Dhabi Water and Electricity Company (ADWEC) ED/L06/017 22 Jun 2011 Maximum Allowed Revenues for 2011 for the Electricity Procurement Business Al Ain Distribution Company (AADC) ED/L06/018 7 Aug 2011 Maximum Allowed Revenues for 2011 for Water and Electricity Abu Dhabi Distribution Company (ADDC) ED/L06/019 7 Aug 2011 Maximum Allowed Revenues for 2011 for Water and Electricity
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Public record of activities and documents (continued)
Revocations
Archirodon Construction (Overseas) Co. S.A. ED/L05/003 16 Feb 2011 Licence revoked as no longer engaged in licensed activity
Consents
Consents confer rights and obligations on licence holders. Revisions or renewal of consents are listed for the sake of completeness. Abu Dhabi Distribution Company (ADDC) ED/L03/042 6 Jan 2011 Supply and sale of non-potable water to TDIC Abu Dhabi Water and Electricity Company (ADWEC) ED/L03/061 30 Jan 2011 Procure and sell electricity and water outside the Emirate of Abu Dhabi with certain entities Shuweihat CMS International Power Company (SCIPCO) Supply and sale of dustilled water to Samsung C&T Corporation ED/L03/057 1 Feb 2011
Abu Dhabi Distribution Company (ADDC) ED/L03/015 3 Feb 2011 Central laboratory services Abu Dhabi Transmission and Despatch Company (TRANSCO) ED/L03/012 6 Feb 2011 Provision of manpower services Abu Dhabi Transmission and Despatch Company (TRANSCO) ED/L03/062 15 Mar 2011 Consent for the disposal of assets Abu Dhabi Transmission and Despatch Company (TRANSCO) ED/L03/063 20 Mar 2011 Transmission and despatch of power and water outside the Emirate of Abu Dhabi from the F1 and F2 facilities Abu Dhabi Transmission and Despatch Company (TRANSCO) ED/L03/064 20 Mar 2011 Interconnection of electricity and water transmission systems operated by TRANSCO and certain entities outside the Emirate of Abu Dhabi Higher Corporation for Specialized Economic Zones (ZonesCorp) ED/L03/065 14 Jun 2011 Concerning operational control over relevant assets
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14 Jun 2011 Al Ain Distribution Company (AADC) ED/L03/066 Provision of diesel engine maintenance services 11 Jul 2011 Abu Dhabi Distribution Company (ADDC) ED/L03/067 Undertake sewerage customer contact and billing services 11 Jul 2011 Al Ain Distribution Company (AADC) ED/L03/068 Undertake sewerage customer contact and billing services 15 Sep 2011 Emirates Sembcorp Water and Power Company (ESWPC) ED/L03/069 Supply of demineralised water to the Fujairah Renery Company Limited 25 Sep 2011 Arabian Power Company (APC) ED/L03/070 Supply of distilled water to Alsa Engineering and Construction Co. LLC
Consultation papers
Consultation papers are designed to seek views from a range of stakeholders and other interested parties on matters which may have a signicant impact on licence holders or customers.
General
Summer Reliability Assessment CD/T02/001 Proposed Health and Safety Management Framework CD/T01/003 Electricity Transmission Code Amendment Consultation CD/C01/020
Regulations
Recycled Water and Biosolids and Trade Effluent Control Regulations Wastewater regulations compliance guide for small scale licensees Recycled Water and Biosolids and Trade Effluent Control Regulations Governance rules for wastewater regulations and review panel CP/T06/001 CR/T06/007
25
Public record of activities and documents (continued)
Publications
Annual work plan 2011 - 2015 ER/P01/016 Water and Electricity Sector Overview 2010 - 2013 ER/P01/017 Annual report for 2010 - Arabic ER/P02/022 Annual report for 2010 - English ER/P02/021 Scale of Charges and Services 2011 - 2012 ER/E01/003 Guide to Customer Services Terminology - Translation Glossary ER/P04/012
Reports
Reports are produced either by Bureau staff or externally appointed consultants. They are not necessarily in the public domain.
General
Renewable energy - targets, costs and subsidies ER/E01/005
Strategic Plan
Strategic Plan 2011 to 2015 IP/G04/002
Policy statement
Statement on actual electricity and water costs ED/S03/001
26
Consultants
Given an ever increasing workload, we employed both local and international consultants to undertake a range of work streams.
The consultants listed below were employed in 2011. Alpha Data LLC Owners engineer for the design, re-location and re-commissioning of the RSB IT/AV system as part of the office move to Sowwah Square Alpha Data LLC Design and implementation of IT server re-build programme British Power International Sector companies asset risk management review EC Harris International Limited Project management services in relation to the t-out of the offices at Sowwah Square, Abu Dhabi GHD Development of low risk trade effluent codes of practice Developing an understanding of water consumption and return-to-sewer rates in 7 model areas in Abu Dhabi Hyder Consulting Middle East Limited Management of water in non-drinking applications in the Emirate of Abu Dhabi Impact Porter Novelli Preparation phase for the launch of new water and electricity bills in the Emirate of Abu Dhabi in 2012 KEMA Limited PC3 Capital Expenditure Review (electricity) Assessment of renewable energy costs, including 10 MW PV plant at Masdar City and Sir Bani Yas Island wind farm Conceptual Design for Abu Dhabi LNG Import Terminals (referenced in 2010; completed in 2011) Kinnarps Project Solutions LLC Fit-out of offices at Sowwah Square, Abu Dhabi (Floors 18 and 19 of Sila Tower)
27
Consultants (continued)
Lloyds Register EMEA Health and safety reviews of AADC and ADDC Reed Smith External legal advisors providing advice to RSB on a range of legal matters Tebodin Consulting Water Quality Inspection project management and technical services Texpo LLC Implementation of an electronic business process platform and document management system Watershed UK Metering and Data Exchange Code (MDEC) review project (Water) WS Atkins PC3 Capital Expenditure Review (water and wastewater) YouGov Siraj AADC, ADDC and ADSSC customer satisfaction survey
28
Growth and production charts
Electricity demand growth (MW)
Water demand growth (MIDG)
16,000 14,000 12,000 1,900 1,522 10,000 864 8,000 6,000 4,114 4,302 4,008 4,000 2,000 0 3,304 4,455 4,790 5,286
1,000 900 800 667.5

TAPCO 2011
700 614
2008 SCIPCO
1,275
600 500 541.1 500 568
901
7,849
7,041
6,395
5,756
3,723
100
2003 2004 2005 2006 2007 2008 2009 2010 2011 2001 2002 2003 2004 2005 2006 2007 2009 SEMBCORP 1999 2000 2010
2001
2000
2002
220
Peak demand Exports to Northern Emirates Available capacity
Peak demand
239
200
279
332
300
380
422
400
Electricity generation (GWh)

14,000 12,000 10,000 8,000 6,000 4,000 2,000 0
RPC APC AMPC GTTPC SCIPCO FAPCO SEMBCORP ECPC TAPCO
Water production (MIG)

60,000 50,000 40,000 30,000 20,000 10,000 0
APC AMPC ECPC FAPCO GTTPC RPC
2010
2011
2010
2011
664.5
655
Available capacity
29
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the nancial statements. Ernst &Young
30
Independent auditors report to the board members

of Regulation and Supervision Bureau
We have audited the accompanying nancial statements of Regulation and Supervision Bureau (the Bureau), which comprise the statement of nancial position as at 31 December 2011 and the statement of nancial performance and statement of cash ows for the year then ended, and a summary of signicant accounting policies and other explanatory information.
Managements responsibility for the nancial statements

Management is responsible for the preparation and fair presentation of these nancial statements in accordance with International Public Sector Accounting Standards and for such internal control as management determines is necessary to enable the preparation of nancial statements that are free from material misstatement, whether due to fraud or error.
The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the nancial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entitys preparation and fair presentation of the nancial statements in order to design audit procedures that are appropriate for the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entitys internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the nancial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Auditors responsibility
Our responsibility is to express an opinion on these nancial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the nancial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the nancial statements.
Opinion
In our opinion, the nancial statements present fairly, in all material respects, the nancial position of the Bureau as of 31 December 2011 and the results of its nancial performance and its cash ows for the year then ended in accordance with International Public Sector Accounting Standards. Ernst & Young 20 June 2012, Abu Dhabi
31
Statement of nancial position

As at 31 December 2011
ASSETS
Non-current assets Furniture and equipment Intangible assets Expenses pending recharge to licensees Advances to employees
Notes 3 4 5
2011 AED 15,137,407 529,369 4,023,178 1,311,968 21,001,922
2010 AED 7,021,194 152,131 5,074,818 265,836 12,513,979 12,947,306 11,937,209 24,884,515 37,398,494
Current assets Expenses pending recharge to licensees Prepayments and other receivables Bank balances and cash
5 6 7
5,074,818 21,441,443 15,585,785 42,102,046
TOTAL ASSETS
63,103,968
LIABILITIES
Non-current liability Employees end of service benets 9 11,014,177 7,917,178
Current liabilities Accounts payable and accruals Advances due to licensees
8 5
52,089,791 52,089,791
27,726,551 1,754,765 29,481,316 37,398,494
TOTAL LIABILITIES
63,103,968
Mohammed Al Bawardi CHAIRMAN
Nick Carter DIRECTOR GENERAL
The attached notes 1 to 15 form part of these nancial statements.
32
Statement of nancial performance

Year ended 31 December 2011
REVENUE
Licence fees Other income Interest income
Notes 11
2011 AED 69,610,220 188,595 174,770 69,973,585
Restarted 2010 AED 52,955,957 478,429 239,492 53,673,878
EXPENSES
Salaries and staff related costs Depreciation Amortisation Rent expense Publicity Recruitment Professional fee Others 3 4 53,340,347 5,062,034 121,262 1,630,265 800,502 1,026,571 1,668,143 6,324,461 69,973,585 RESULTS FOR THE YEAR 5 42,645,812 2,266,007 71,847 1,397,891 984,628 1,187,386 1,891,664 3,228,643 53,673,878 -
33
Statement of cash ows

Year ended 31 December 2011
OPERATING ACTIVITIES
Notes
Results for the year Adjustments for: Provision for employees end of service benets Interest income Loss (gain) on disposal of furniture and equipment Depreciation Amortisation Working capital adjustments: Prepayments and other receivables Accounts payable and accruals Cash from (used in) operations Employees end of service benets paid Net cash from (used in) operating activities
2011 AED 3,096,999 (174,770) 5,321 5,062,034 121,262 8,110,846 (12,319,866) 22,411,027
Restarted 2010 AED 1,771,477 (239,492) (18,033) 2,266,007 71,847 3,851,806 (8,414,708) (6,605,421) (11,168,323) (2,370,599) (13,538,922)
9 3 4
18,202,007 18,202,007
INVESTING ACTIVITIES
Purchase of furniture and equipment Purchase of intangible assets Proceeds from disposal of furniture and equipment Interest received Advances to employees Net cash used in investing activities NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS Cash and cash equivalents at 1 January CASH AND CASH EQUIVALENTS AT 31 DECEMBER 7 3 4 (13,224,069) (498,500) 40,500 174,770 (1,046,132) (14,553,431) 3,648,576 11,937,209 15,585,785 (1,631,014) (146,277) 36,066 239,492 (39,121) (1,540,854) (15,079,776) 27,016,985 11,937,209
34
Notes to the nancial statements

31 December 2011
1 ACTIVITIES
Regulation and Supervision Bureau (the Bureau) was established under Law No. (2) of 1998 to regulate the water and electricity sector in the Emirate of Abu Dhabi. The Bureau is funded by the payment of license fees by those entities awarded licenses and is a not for prot organisation. The Bureaus registered office is at PO Box 32800, Abu Dhabi, United Arab Emirates. The nancial statements of the Bureau for the year ended 31 December 2011 were authorised for issue by the management on 20 June 2012.
2.1
BASIS OF PREPARATION
The nancial statements have been prepared in accordance with International Public Sector Accounting Standards (IPSAS) issued by the International Public Sector Accounting Standards Board (IPSASB). Where an International Public Sector Accounting standard does not address a particular issue, the appropriate IFRS / IAS has been applied. The nancial statements have been prepared on the historical cost basis. The nancial statements have been presented in UAE Dirhams (AED), which is the functional currency of the Bureau.
2.2
FUNDAMENTAL ACCOUNTING CONCEPT
Although as at 31 December 2011, the Bureaus current liabilities exceeded its current assets by AED 9,987,745 (2010: AED 4,596,801), the nancial statements have been prepared on a going concern basis, as the major portion of current liabilities represents an advance received from licensees amounting to AED 40,085,001 (2010: AED 17,835,409), which will be amortised and recognised as revenue and is not expected to be repaid, and, therefore, will not signicantly affect the Bureaus cash ows in the foreseeable future.
2.3
CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES
The accounting policies adopted are consistent with those of the previous nancial year except as follows: IPSAS 25 Employee Benets - The Standard is effective from 1 January 2011 and prescribes the accounting and disclosure by public sector entities for employee benets. It is based on IAS 19 Employee Benets. The Standard deals with four categories of employee benets, short-term employee benets, post-employment benets, other long-term employee benets and termination benets. Benets that are not consideration in exchange for service rendered by employees or past employees of reporting entities are not within the scope of this Standard. The adoption of the standard did not have any impact on the nancial position or performance of the Authority.
35

31 December 2011
2.4
SIGNIFICANT ACCOUNTING JUDGEMENT, ESTIMATES AND ASSUMPTIONS
The preparation of the Bureaus nancial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosures of contingent liabilities, at the reporting date. However, uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustment to the carrying amount of the asset or liability affected in the future periods. Estimation uncertainty The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a signicant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next nancial year are discussed below: Useful lives of furniture and equipment The Bureaus management determines the estimated useful lives of its furniture and equipment for calculating depreciation. This estimate is determined after considering the expected usage of the asset or physical wear and tear. Management reviews the residual value and useful lives annually and the future depreciation charge would be adjusted where management believes that the useful lives differ from previous estimates. Useful lives of intangible assets The Bureaus management determines the estimated useful lives of its intangible assets for calculating amortisation. This estimate is determined after considering the expected usage of the asset. Future amortisation charge would be adjusted where management believes that the useful lives differ from previous estimates.
2.5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
License fees revenue License fees funding from the licensees in respect of the current year is accounted for in the statement of nancial performance based on the amount of the funding received from the licensees during the year. Any funding received in excess of the expenditure incurred by the Bureau, is refunded back to licensee in every two years. Short funding is recovered from licensee in every two years. Interest income Interest revenue is recognised as the interest accrues using the effective interest method, under which the rate used exactly discounts estimated future cash receipts through the expected life of the nancial asset to the net carrying amount of the nancial asset.
36

31 December 2011
Capital work in progress Capital work in progress is recorded at cost and represents costs based on contractual payments for the design, development, procurement, construction and commissioning of the plant and overhead expenses and those incurred during the development stage directly attributable to the construction of the plant. The capital work in progress is transferred to the appropriate asset category and depreciated in accordance with the Bureaus policies when construction of the asset is completed and commissioned Furniture and equipment Furniture and equipment are stated at cost less accumulated depreciation and any impairment in value. Depreciation is calculated on a straight line basis over the estimated useful lives of the assets as follows: Office equipment and furniture 3-5 years Motor vehicle 3 years Furniture and equipment continued The carrying values of furniture and equipment are reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. If any such indication exists and where the carrying values exceed the estimated recoverable amount, the assets are written down to their recoverable amount, being the higher of their fair value less costs to sell and their value in use. Expenditure incurred to replace a component of an item of furniture and equipment that is accounted for separately is capitalised and the carrying amount of the component that is replaced is written off. Other subsequent expenditure is capitalised only when it increases future economic benets of the related item of property, plant and equipment. All other expenditure is recognised in the statement of nancial performance as the expense is incurred. An item of furniture and equipment is derecognised upon disposal or when no future economic benets are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the statement of nancial performance in the year the asset is derecognised. Intangible assets Technology licenses and similar rights are stated at cost and amortized on a straight-line basis over the expected life or contractual term of the asset. The amortization periods applied are three years. Costs associated with maintaining software programmes are recognised as an expense as incurred. Development costs that are directly attributable to the design and testing of identiable and unique software products controlled by the Bureau are recognised as intangible assets when the following criteria are met:
37

31 December 2011
It is technically feasible to complete the software product so that it will be available for use Management intends to complete the software product and use it There is an ability to use the software product It can be demonstrated how the software product will generate probable future economic benets Adequate technical, nancial and other resources to complete the development and to use the software product are available The expenditure attributable to the software product during its development can be reliably measured Accounts payable and accruals Liabilities are recognised for amounts to be paid in the future for goods or services received, whether billed by the supplier or not. Impairment and uncollectibility of nancial assets An assessment is made at each statement of nancial position date to determine whether there is objective evidence that a specic nancial asset may be impaired. If such evidence exists, any impairment loss is recognised in the statement of nancial performance. Impairment is determined as the difference between the present value of future cash ows discounted at the current market rate of return for a similar nancial asset. Cash and cash equivalents For the purpose of the statement of cash ows, cash and cash equivalents consist of cash in hand, bank balances, and short-term deposits with an original maturity of three months or less, net of outstanding bank overdrafts. Accounts receivable Accounts receivable are stated at original invoice amount less a provision for any uncollectible amounts. An estimate for doubtful debts is made when collection of the full amount is no longer probable. Bad debts are written off when there is no possibility of recovery. Employees end of service benets The Bureau provides end of service benets to its expatriate employees. The entitlement to these benets is usually based upon the employees length of service and completion of a minimum service period. The expected costs of these benets are accrued over the period of employment. With respect to its national employees, the Bureau makes contributions to Abu Dhabi Retirement Pension and Benet Fund calculated as a percentage of the employees salaries. The Bureaus obligations are limited to these contributions, which are expensed when due.
38

31 December 2011
Financial instruments Financial instruments include receivables, bank balances and cash, payables and certain other nancial assets and liabilities. Fair values of nancial instruments are based on estimated fair values using such methods as net present values of future cash ows.
2.6
FUTURE CHANGES IN ACCOUNTING POLICIES STANDARDS ISSUED BUT NOT YET APPLIED
Standards issued but not yet effective up to the date of issuance of the Bureaus nancial statements are listed below: IPSAS 27 Agriculture: Effective for annual periods beginning on or after 1 April 2011 IPSAS 28 Financial Instruments: Presentation effective 1 January 2013 IPSAS 29 Financial Instruments: Recognition and Measurement effective 1 January 2013 IPSAS 30 Financial Instruments: Disclosures effective 1 January 2013 Improvements to IPSASs: Effective for annual periods beginning on or after 1 January 2013
As per management, the adoption of the above standards will not have any effect on the nancial performance or the position of the Bureau.
39

31 December 2011
FURNITURE AND EQUIPMENT

Work in progress AED 12,829,119 12,829,119 12,829,119
2011
Cost: At 1 January 2011 Additions Disposals during the year At 31 December 2011 Depreciation: At 1 January 2011 Depreciation charge for the year Relating to disposals At 31 December 2011 Net carrying amount: At 31 December 2011
Office equipment Motor vehicle and furniture AED AED 168,000 190,000 (168,000) 190,000 108,010 68,410 (128,183) 48,237 141,763 11,202,412 204,950 (6,598) 11,400,764 4,241,208 4,993,624 (593) 9,234,239 2,166,525
Total AED 11,370,412 13,224,069 (174,598) 24,419,883 4,349,218 5,062,034 (128,776) 9,282,476 15,137,407
2010
Cost: At 1 January 2010 Additions Disposals during the year At 31 December 2010 Depreciation: At 1 January 2010 Depreciation charge for the year Relating to disposals At 31 December 2010 Net carrying amount: At 31 December 2010 242,000 (74,000) 168,000 86,409 80,666 (59,065) 108,010 59,990 9,617,991 1,631,014 (46,593) 11,202,412 2,099,362 2,185,341 (43,495) 4,241,208 6,961,204 9,859,991 1,631,014 (120,593) 11,370,412 2,185,771 2,266,007 (102,560) 4,349,218 7,021,194
Work in progress relates to the costs of leasehold improvements, furniture and ttings for the new office, which the Bureau re-located to subsequent to the year end. Included in the depreciation charge for the year is AED 2,531,052 relating to accelerated depreciation on office equipment and furniture rising due to the decision by the Bureau to early terminate its office lease and re-locate to a new office (note 5).
40

31 December 2011
INTANGIBLE ASSETS
2011 AED 373,357 498,500 871,857 221,226 121,262 342,488 529,369 2010 AED 227,080 146,277 373,357 149,379 71,847 221,226 152,131
Cost: At 1 January Additions At 31 December Amortisation and impairment: At 1 January Amortisation At 31 December Net carrying amount: At 31 December
RESULTS FOR THE YEAR
As per Bureau policy, any license fees funding received in excess of expenditure is refunded back to licensees every two years. Short funding is recovered from licensee every two years. The respective amounts have been classied in the statement of nancial position as follows:
2011 AED Expenses pending recharge to licensees - Non-current assets Expenses pending recharge to licensees - Current assets Advances due to licensees - Current liabilities 4,023,178 5,074,818 2010 AED 5,074,818 1,754,765
As a result of the decision to re-locate to a new office location, results for the year include AED 2,531,052 relating to the re-assessment of the useful lives of the assets at the current office location (note 4) and provision of AED 2,286,650 for reinstatement of the current office location to its original condition in accordance with the terms of the office lease.
41

31 December 2011
PREPAYMENTS AND OTHER RECEIVABLES

2011 AED 2010 AED 2,770,294 3,218,399 6,901,102 57,511 12,947,306
Prepaid staff rent Other prepayments Amounts pending recharge to licensees Other receivables
7,128,507 1,855,004 11,111,008 1,346,924 21,441,443
BANK BALANCES AND CASH
Included in bank balances and cash of AED 15,585,785 (2010: AED 11,937,209) are bank deposits of AED 5,004,587 (2010: AED 7,821,458) with a commercial bank in Abu Dhabi. These are denominated in UAE Dirhams, short term in nature, with effective interest rate of 0.75% (2010: 1.4%).
ACCOUNTS PAYABLE AND ACCRUALS

2011 AED 2010 AED 3,544,935 2,513,337 21,668,279 27,726,551
Accounts payable Accrued expenses Advances from licensees
5,472,784 4,110,350 42,506,657 52,089,791
The advances from licensees relate to amounts received for specic projects by the Bureau. Included in advances from licensees is an amount of AED 40,085,001 (2010: AED 17,835,409) from Abu Dhabi Water Electricity Authority (note 11) representing license fees for the subsequent year.
42

31 December 2011
EMPLOYEES END OF SERVICE BENEFITS
Movements in the provision recognised in the statement of nancial position are as follows:
2011 AED Balance at 1 January Provided during the year Employees end of service benets paid Balance at 31 December 7,917,178 3,096,999 11,014,177 2010 AED 8,516,300 1,771,477 (2,370,599) 7,917,178
10
RELATED PARTY TRANSACTIONS
Related parties represent associated board members, directors and key management personnel of the Bureau. Pricing policies and terms of these transactions are approved by the Bureaus management. Compensation of key management personnel The remuneration of the members of key management during the year was as follows:
2011 AED Salaries Accommodation allowance Other benets End of service benets 7,431,200 2,422,987 1,296,676 1,140,375 12,291,238 2010 AED 5,935,059 1,669,057 741,599 757,122 9,102,837
43

31 December 2011
11
LICENSE FEES
2011 AED 2010 AED 42,270,346 28,521,020 (17,835,409) 52,955,957
License fees received during the year, net License fees received in advance, net of receivable fees: Beginning balance Ending balance (note 8)
91,859,812 17,835,409 (40,085,001) 69,610,220
12
FAIR VALUES OF FINANCIAL INSTRUMENTS
Financial instruments comprise of nancial assets and nancial liabilities. Financial assets consist of cash and bank balances and nancial liabilities consist of payables. The fair values of nancial instruments are not materially different from their carrying values.
13
RISK MANAGEMENT
Risk is inherent in the Bureaus activities but it is managed through a process of ongoing identication, measurement and monitoring, subject to risk limits and other controls. This process of risk management is critical to the Bureaus continuing protability and each individual within the Bureau is accountable for the risk exposures relating to his or her responsibilities. The main risks arising from the Bureaus nancial instruments are interest rate risk credit risk and liquidity risk and foreign currency risk. No changes were made in the risk management objectives and policies during the years ended 31 December 2011 and 31 December 2010. The management of the Bureaus reviews and agrees policies for managing each of these risks which are summarized below.
Interest rate risk

The Bureau is exposed to interest rate risk on its interest bearing bank deposits.
Interest rate risk table

The following table demonstrates the sensitivity to a reasonably possible change in interest rates, with all other variables held constant, of the Bureaus decit (through the impact on oating rate deposits).
44

31 December 2011
Assumed change in interest rates
0.50% 2011 AED 25,023 (25,023) 2010 AED 39,107 (39,107)
Impact on decit from increase in interest rates: Impact on decit from decrease in interest rates:
Credit risk
The Bureau collects licence fees from its related parties. Licence fees are collected based on an annually forecast budget. The Bureau limits its credit risk with regard to bank deposits by only dealing with reputable banks. Credit risk is limited to the carrying values of nancial assets in the statement of nancial position.
Liquidity risk
The Bureau limits its liquidity risk by monitoring its current nancial position in conjunction with its cash ow forecasts and close communication with ADWEA on a regular basis to ensure funds are available to meet its commitments for liabilities as they fall due. Accounts payable are normally settled within 30 days of the date of purchase. The contractual payment terms of all nancial liabilities of the Bureau as at 31 December 2011 were less than three months.
Currency risk
Currency risk comprises of transactions and statement of nancial position risk. Transaction risk related to Bureaus cash ow being adversely affected by a change in the exchange rates of foreign currencies against UAE Dirhams. Statement of nancial position risk relates to the risk of the Bureaus monetary assets and liabilities in foreign currencies acquiring a lower or higher value, when translated into UAE Dirhams as a result of currency movements.
14
COMPARATIVE INFORMATION
Certain comparative gures were reclassied to conform to the current year presentation. Such reclassications, as discussed below, had no effect on the statement of nancial position. As stated in note 5, any license fees funding received in excess of expenditure is refunded back to licensees every two years and short funding is recovered from licensee every two years. Any surplus or decit for the year is now adjusted against revenue as the excess or short funding is to be settled with the licensee. The prior year comparative gures have been re-stated and classied in line with the current year presentation as follows:
45

31 December 2011
Statement of nancial performance:

2010 AED Decit (as previously presented) Licence fees (as previously presented) Licence fees (5,074,818) (47,881,139) 52,955,957 -
15 COMMITMENTS
Estimated capital expenditure contracted for at the reporting date, but not yet incurred amounted to AED 9,356,408 (2010: AED 477,750).
46
Our responsibility is to express an opinion on these nancial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Ernst &Young
Scan code for a direct link to our website
(ER/P02/023)
The Regulation & Supervision Bureau PO Box 32800 Abu Dhabi United Arab Emirates Email: bureau@rsb.gov.ae www.rsb.gov.ae

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ANNUaL REPORT

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

The past year saw a major focus on customer service initiatives.

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

Start of phase 2 of the GCC grid interconnection project

Launch of the Oman-UAE power grid interconnection

Licensing of an Independent Power Producer

Regulatory Policy Statement on electricity and water costs

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

System peak demand (includes exports to other Emirates)

683,000 m3/d average, received at wastewater treatment plants

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

Average unit costs

10,213 8,352 1,644

AED per unit (Unit =1,000 litres or 1 m3)

The Abu Dhabi Regulation & Supervision Bureau

Helping sector customers

Progressing compliance with wastewater regulations

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

Water quality inspection project

Changes to industry charging arrangements

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

Protecting people and the environment

Regulating the wastewater sector

Health and safety consultation

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

Solar energy projects

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

The War Offices

Additional water and electricity capacity

The GCC interconnection (GCCI)

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

GCC Interconnection UAE System (ENG)

UNITED ARAB EMIRATES

The GCC interconnection grid

The UAE-Oman interconnection

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

Sector governance and Board of Directors

Governing sector law

ADSSC establishing law

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau

Generation - renewable energy

Distribution and supply

Wastewater - major licences

Annual Report 2011 |

The Abu Dhabi Regulation & Supervision Bureau