The report describes, beyond the established statutory requirements, the measures taken by the Company to achieve greater transparency and efficiency in the performance of the functions of the governing bodies and includes those aspects that are considered relevant in improving good governance of the Company.

In 2014, electricity demand continued the downward trend experienced over recent years. However, it is worth noting that in 2014 the fall was lower than that recorded in 2013, indicating that consumption, unlike in previous years, has shown some signs of recovery. Specifi cally, the demand for electrical energy on the Spanish peninsula (which represents 94.3% of the national total) closed the year at 243,530 GWh, a fi gure 1.2% lower than that registered in 2013. After factoring in the eff ects of the seasonal and working patterns, the demand for electricity, mainly attributable to economic activity, showed a slight decrease of 0.1%, ompared to the fall of 2.2% experienced in 2013.

This report contains the most relevant data regarding the Company's activity during the fiscal year: key figures, significant events, business activities, corporate management, Stock Market evolution and annual accounts.

This report contains the most relevant data regarding the Company's activity during the fiscal year 2014.

The Corporate Governance Report is published every year in order to show the efforts of Red Eléctrica to introduce the best international principles and recommendations of good corporate governance and its practical implementation, both in the structure and functioning of the governing bodies of the Company and in regard to the commitments and responsibilities undertaken with its shareholders, investors, the markets and other stakeholders.

The demand for electricity in 2013 fell again for the third consecutive year reaching a level similar to that registered in 2005. Ever since the economic crisis began in 2008, demand has experienced a continued decline consistent with the negative behaviour of the Spanish economy and, despite following a path of gradual improvement in 2013 with a small increase in the third and fourth quarters (0.1% and 0.2% respectively quarter on quarter), in general 2013 saw a drop in GDP of 1.2% year on year.