Despite the energy crisis, in 2022 Madrileña Red de Gas has achieved 13,299 new Natural Gas installations put into service. This growth, together with that generated with other inorganic growth actions, has allowed Madrileña Red de Gas to exceed the number of 900,000 supply points.

This is the result of the success of our commercial policy, innovating with new strategies and channels to reach the end user. In this way, we have increased the commercial effort with different types of campaigns to promote vertical and horizontal saturation.

In addition, we have extended the network to serve a pharmaceutical laboratory, a paper mill and different food and plastics industries, among others. We have put into service 15 community halls, 35 schools, as well as 3 crematoriums.

Residential Market

The current global energy crisis, the effects of the war in Europe, as well as the continuous regulatory changes are having a significant impact on the energy market and in particular on the gas system. These factors have had an impact on the growth in new supply points, which has been lower than in previous years.

Madrileña Red de Gas exceeds the historical figure of 900,000 supply points, becoming the fastest growing Natural Gas distribution company in Spain and approaching second place in total volume of installations.

Madrileña Red de Gas has achieved 13,299 new Gas Natural installations, commissioned as a result of the commercial actions for organic growth of the Expansion Department. This growth, together with that generated with other inorganic growth actions, has allowed: Madrileña Red de Gas exceeds the historical figure of 900,000 supply points, becoming the fastest growing Natural Gas distribution company in Spain and approaching second place in total volume of installations.

If we analyze the evolution of new supply points by market type, we can see the effect on the New Construction market due to regulatory changes associated with the Technical Building Code, in favor of electrification and the emergence of new technologies. In Madrileña Red de Gas, we are working to offer developers new hybridization solutions for heating and new strategies such as renewable gases.

However, no major changes are observed in the rest of the natural gas markets (Horizontal Saturation, Vertical Saturation, Spontaneous and Commercial Premises), maintaining a trend that continues with previous years. It should be considered that the geographical area of Gas distribution is predominantly residential and that the capillarity of the MRG network is such that there are few areas where there is no distribution network. This once again highlights the success of our commercial policy, innovating with new strategies and channels to reach the end user.

Commercial campaigns in the residential market

During 2022, we have increased our commercial efforts, achieving a more far-reaching impact within MRG’s distribution zone, in order to drive the Horizontal Saturation and Vertical Saturation markets.

• Specific campaigns throughout the territory: Destined to increase the market for Horizontal Saturation and Vertical Saturation and aimed at mobilizing up to 6,00 homes, through the conventional channel of installation companies and aimed at driving new pipelines and saturation of existing ones, with an impact on each home, generating a specific offer of your interest.
• Digital campaign in major social networks: Through Facebook and Instagram and aimed at 37 municipalities, in order to capture supply points from
  the Horizontal Sturation market. Controlled and managed directly by market managers.
• Campaign for the individualization of central systems in Communities of Owners: Due to the increase in the price of gas, some Communities considered individualizing the central heating services, especially where there are problems od non-payment. From MRG we facilitate this choise, easier to implement that a possible aerothermal energy, with a special campaign.

  An extensive publicity campaign has been prepared to inform the communities od the benefits of the individual systems and the aid offered by MRG to help the change.

Through different commercial campaigns, we have managed to promote the commercialization of the markets in different periods of the year, focusing specifically on each one of them.

Public offer 2022

With the conventional commercial campaigns, to which were added those mentioned above, during 2022, we have managed to get more than 220 Installation Companies to join us on this journey by signing our 2022 Public Offer and the Commercial Plans advertised through our website.

Plan Renove for individual boilers in the Community of Madrid

The Community of Madrid develops different Planes Renove for consumers, among others, the one for the replacement of boilers and individual heaters or the energy rehabilitation of buildings that was launched in 2022.

The replacement of individual boilers and heaters in homes reduces heating losses, reduces the environmental impact of emissions and improves the level of safety in homes. That is why the Community of Madrid encourages the installation of boilers and heaters with this Plan Renove.

Individuals or legal entities have been able to benefit from this plan, whether they own or lease the property in which the installation is to be carried out.
The amounts range from €350 for the replacement of condensing boilers to €150 for low NOX water heaters.

The great acceptance of this type of initiative demonstrates the need of users for clean, accessible and economical energy. When technological neutrality is achieved, the user decides which energy alternative best meets his or her needs. Therefore, this commitment on the part of the Community of Madrid is particularly noteworthy. Initiatives such as these allow for significant improvements in energy efficiency and pollutant emissions, without the need for large investments in equipment or infrastructure.

Other actions with the collaborator channel:

The channel of collaborating companies is of great importance to MRG, due to the increase in prices of various materials, which occurred throughout the year, and to
adapt to the reality of the market, during 2022 the contract payment prices of the components of the Community Receiving Installations have been revised upwards, to help our channel of installation companies and encourage the use of these Receiving Installations.

High Consumption

Despite the crisis experienced during 2022, as it was a stable and secure supply for the industry, excellent results were achieved in the complex social and geopolitical environment that characterized 2022.

The objectives set at the beginning of the year have been met thanks to the joint work, increasing consumption by more than 180 GWh and 466 new supply points.

From Madrileña Red de Gas, we have continued to promote that natural gas is necessary in the energy transition in which we find ourselves. Some of these industry examples are::

• ROVI laboratories in San Sebastián de los Reyes. ROVI is a pharmaceutical company dedicated to the research, development, manufacture and marketing of pharmaceutical products. In the factory they have in this municipality, they installed new production lines and equipment using natural gas for the formulation, filling, automatic visual inspection, labelling and packaging of the Moderna COVID-19 vaccine.
• The Paquita Paper Mill in Villanueva del Pardillo. This paper mill is located in the Las Vegas residential development of this municipality and was founded in 1966. It used fuel oil for the production of packaging and recycled paper, which led to constant complaints from neighbors due to the environmental pollution it generated. Natural gas was part of the solution to this problem, so Madrileña Red de Gas carried out the necessary actions and infrastructures to provide them with a more environmentally sustainable, comfortable and safe supply.

Natural gas continues to be essential throughout the industry; other notable examples this year are POLYPLAST HISPANIA, dedicated to the production and processing of expanded polystyrene, CARPISA, the meat industry, and DOS DINGOS, a brewery.

Another type of customer to be highlighted, which has meant a great consumption for the company, has been the funeral parlors/crematoriums. Last year, three crematoriums were put into service: El Escorial, Colmenar Viejo and Valdemoro. The first two used other energy sources, such as propane gas and diesel, respectively. The companies that operate them decided to install new furnaces using natural gas as fuel, thus improving their efficiency and environmental emissions. The peculiarity of all these crematoria, due to their activity, is that they are located on the outskirts of the municipalities, so MRG made a large investment as they are complex works and far from the distribution network so that they could have the most environmentally friendly energy.

The objectives set at the beginning of the year have been met thanks to the joint work, increasing consumption by more than 180 GWh and 466 new supply points

Natural gas has continued to be an efficient and sustainable solution for air conditioning in the residential and tertiary sectors, providing heating and hot water to residential communities and public buildings. During 2022, 15 community halls and 35 schools have been put into service

District Heating or district networks consist of a central power generation facility and a network of pipes, usually buried, through which thermal energy is circulated and distributed by circulating steam or hot water.

Another milestone achieved this year was the supply of natural gas to District Heating in Móstoles. Móstoles District Heating is the largest district heating and SHW network in Spain for 6,500 homes. It was inaugurated in 2017 and the plant is composed of two 5,000 kW biomass boilers and a 2,000 kW support boiler, with an expected consumption of 5,934 tons of biomass per year. After five years of operation, they have had to choose to include a natural gas support by installing two boilers of 4,600 kW and one of 1,650 kW, since biomass alone did not achieve the expected thermal equipment performance.

In addition, another of the disadvantages of District Heating was the need for adequate logistics to supply the biomass to the boilers, which they have been able to overcome with the continuous supply provided by natural gas. Biomass is considered renewable because it does not contribute to greenhouse gas emissions, since its CO2 emissions are neutral, but it does not take into account the CO2 emissions associated with the pretreatment of the biomass and its transport, in addition to the serious impact it has on local pollution.

Another of the initiatives carried out was the sending of letters to the neighbors of the Communities of Owners of the districts of Madrid informing them of the specific aids for the change of the boiler room of their community: Plan Renove and Madrid 360o to which those Communities that converted their boilers to natural gas finally accepted.

In addition, during 2022, we worked with new databases of potential large consumer customers. We are working with this segmentation by sector and market in the tool developed by REINS engineering, where the distribution network can also be visualized.

New Construction

The year 2022 has revealed the introduction of other solutions for the energy needs of buildings such as aerothermal and geothermal energy.

It has been possible to verify how the predisposition towards other energy production systems, especially aerothermal energy, has changed. The entry into force of the modification of the CTE (Technical Building Code) in 2022 has confirmed these changes. This Technical Code continues to allow the use of natural gas, also obtaining the maximum qualification.

Despite all the difficulties, 4,129 homes have been supplied with natural gas by 2022. Of these, 2,595 homes are equipped with individual boilers and 1,534 with central boilers.

Expansion Area has worked intensively with the developers, holding meetings with each of them to try to find out the energy preferences of their future developments and to inform them of the existing possibilities.

The “efficiency” of aerothermal systems depends on the geographical area where they are installed and in Madrileña Red de Gas, together with the engineering company ESCAN, we have carried out a detailed analysis, which we have shared with real estate developers.

Despite all the difficulties, 4,129 homes have been supplied with natural gas by 2022. Of these, 2,595 homes are equipped with individual boilers and 1,534 with central boilers

Detailed study on aerothermal energy in Continental Clime

In January 2022 and in collaboration with the company Escan S.L., a document has been prepared with all the necessary information to know our main competition in the New Construction market.

These are some of the conclusions of the report:

• Los sistemas de calefacción basados en aerotermia únicamente muestran altas eficiencias en climas templados (zonas de costa) y tienen rendimientos bajos en localidades con inviernos muy fríos, típico del clima continental de la Comunidad de Madrid.
• Despite being considered a renewable technology, aerothermal equipment has inderect CO2 emissions, due to the consumption of non-renewable electricity in the current Spanish energy mix, and direct CO2 emissions, due to the use of a refrigerant gas.
• The initial investment cost and the life cycle cost are high for an aerothermal system, even compared to a solution with similar benefits based on a condensing boiler, air conditioning and solar thermal panels.
• In scondary homes, the high initial investment cost and the low use of heating mean that profitability is significantly reduced.
• Aerothermal energy can only be used efficiently with low-temperature radiators, underfloor heating or fan coils, not with conventional high-temperature radiators
• The aerothermal equipment has outdoor units on roofs, facades or floors, which take up space, harm the aesthetics of the building and make noise.
• Aerothermal requires a high power term, between 2 and 4 kW higher than a system without a heat pump. This can motivate changes in the electricity rate of the bill, in addition to its corresponding energy consumption.
• Aerothermal energy causes consumption peaks during start-up, especially on hot or cold days, which can cause safety cuts in the differentials of homes, or even cause cuts in the electrical network, affecting other neighbors.
• Gas boilers are compatible with biogas and decarbonization. Currently they even admit 20% hydrogen in commercial units and a growth of this percentage is expected in the coming years.

These arguments have helped us to defend our product, thanks to the deepest technical knowledge about aerothermal systems. For this reason, at MRG we promote the hybridization of aerothermal natural gas, focusing on important aspects such as improved energy efficiency, maintenance of energy rating, lower life cycle cost, reliability, and improved service guarantee.

Signing of Agreement with EC and AEDAS Homes and TESTA HOME

During 2022, and in collaboration with the Energy Company Aedas Homes, the first agreement has been signed to install natural gas boilers to support the aerothermal equipment (180 homes Majadahonda).

This marks a major breakthrough in this area since, as seen above, it has been demonstrated that the aerothermal system works best when supported by a natural gas boiler that increases the efficiency of the system.

LPG Market

Madrileña Red de Gas in the last year has started the final phase of the project to transform more than 15,000 supply points in planning for the years 2022 and 2023.

During the past year, this operation has been carried out in more than 7,000 homes. To this end, we have collaborated with eight leading companies in the sector, converting more than 66 storage centers to natural gas.

MRG has acted in 23 municipalities in the Community of Madrid, leaving 12 of them free of propane gas.

In 2022, more than 5 million euros have been earmarked to carry out the work of reusing and expanding networks, adapting and modifying facilities, transforming equipment and decommissioning storage centers.

In addition to this work, progress has continued to be made in the digitalization and automation of the processes of generating orders to be executed in the field and in the resolution of claims, making the transformation operation an easy, safe and comfortable process for the end user.

In the coming years, 100% of LPG installations will be completed, reaching the municipalities of Soto del Real, Miraflores de la Sierra and Los Molinos.

For the year 2023, we plan to transform more than 5,000 homes to natural gas, which would complete the transformation of all the facilities where we currently have the feasibility of connecting to the Natural Gas network

Digitization

In 2022, we have focused on expanding the services offered by the installers’ area in the virtual office. A strong investment has been made to improve the personalized section on the website for installation companies. A digital advance has been made for the creation of files related to new or new gas connections, in residential housing installations up to 50kw, through our Virtual Office, allowing us to view their status and manage requests 24 hours a day.

Our objective is that all the procedures that an installation company needs to do with MRG are unified through the web

With the implementation of 100% telematics filing since April 2022, 636 files have been received throughout the year, with an average processing time of 2.52 calendar days.

Our objective is that all the procedures that an installation company needs to do with MRG are unified through the web. Likewise, this digital progress also included requests for gas cuts necessary for the placement of a new outlet in a common installation. Throughout 2022, 152 requests were handled. The average processing time for these files was 3.94 days.

This progress has also speeded up interdepartmental communications, eliminating the need for e-mails for these procedures, and making it possible to immediately associate a file with specific supply points. As a result, the monitoring and control of the process can be carried out in detail, at any time and with access to the information by any person involved in any of its states.

To this end, in 2023 it is planned to include requests for gas shut-offs, in case of modification of the common installation, as well as new connection files associated with dwellings with power over 50kw, as well as any commercial or industrial premises.

In addition to this, all these files will be automatically linked to the incoming registration request from the supplier, and all the documentation in the field will be available at the moment on our operators’ terminals.

Collaborators

Madrileña Red de Gas continues its commitment to build loyalty in our commercial channel and collaborating companies, investing in the development of tools that facilitate the daily work that results in the acquisition of new customers.

During 2022, the expansion of the Enerty tool has continued, where more than 8,000 IRG3 installation certificates from MRG’s distribution area have been processed. In addition, we have incorporated the Certificates of Correction of Anomalies in Periodic Inspections into the certification flow.

On the other hand, different initiatives have been carried out for the marketing of natural gas. Thanks to the collaboration of the company The Marketing Hub, an advertisement was installed on billboards in industrial estates where MRG has a presence. The aim was to arouse interest in the supply of natural gas to those companies that did not yet have it. The billboards chosen were located in the San Fernando de Henares Industrial Estate and the El Álamo Fuenlabrada Industrial Estate.

Potential market management and third-party networks

In collaboration with the engineering firm REINS and continuing the potential management project started in 2021, for the visualization of the entire territory managed by MRG segmented by market and supply, during 2022, the thirdparty network management viewer has been developed.

Based on Google Maps technology and through the overlapping of cadastre and mapping layers of our network, we have managed to develop a geo-positioned visualization of future urban developments where, through the signing of a collaboration agreement with the land developers, future networks prepared for renewable gases will be built, also giving access to future renewable hydrogen networks.

Through the control cards and the detail by color, we can visualize all those future developments for which we have issued feasibility reports for future networks.

Virtual office for the recruitment of our LPG customers

This project arose as a purpose of updating the new contracting processes, since consumers, especially domestic consumers, already operate digitally with most services on a daily basis.

The main objective of the project was to automate the LPG contracting processes, so that through the Virtual Office the contract is generated in Logalty support, the customer receives an email to sign the contract and once signed, the OV itself sends it to our system to generate the registration.

During 2022, this process has been enhanced to also include ownership changes on LPG contracts. Today, 100% of MRG’s LPG registrations and ownership changes are managed through the Virtual Office.

Distribution Network

As part of MRG’s action plans for 2022, the necessary renovations, meshing and corrective actions have been carried out to maintain the safety conditions in the network and guarantee the supply of natural gas and LPG networks, replacing materials such as steel, cast iron and/or copper with polyethylene piping. Renewing, during this year 2022, about 800 meters of copper and steel network in LPG networks.

The correct operation of the regulation systems in their different pressures has been managed, carrying out the corresponding regulatory surveillance on the gas network and the tightness control of 2548 km of the gas network, operating more than 7000 valves to check their correct operation, carrying out about 1000 painting/cleaning actions of the network elements and about 6990 measurements on the equipment that ensure the cathodic protection of the steel networks.

Likewise, the dismantling of 14 LPG plants has been carried out in coordination with the town councils of the affected municipalities, emptying, burning, inerting and removing 19 tanks. For this purpose, it has been necessary to make more than 15 trips in order to transfer the emptied gas to Repsol’s facilities, thus avoiding emissions into the atmosphere; as well as the transport of the waste obtained in these dismantling operations to the treatment plants set up by the Community of Madrid, respecting Madrileña Red de Gas’s commitment to the environment, all this without interfering with the usual dynamics of customers and neighbors; following the antiCovid-19 action and disinfection protocols before, during and after each work, thanks to which, there has been no contagion among the workers.

Finally, it is worth mentioning that, in collaboration with different companies, public bodies and customers, we have responded to requests received to set back the gas network due to new urban developments, roads of the community of Madrid, construction of new buildings, etc. Approximately 200 meters of setbacks on the gas network have been carried out.

Likewise, 100% of the Maintenance Plan established by current regulations and MRG’s internal standards has been carried out on the 6054 Km of network, auxiliary facilities, the 5 satellite LNG plants and 128 existing LPG plants, carrying out more than 14,000 scheduled actions.

Emergencies

In 2022, the Emergency Department of Madrileña Red de Gas handled a total of 10,253 emergency calls, out of a total of 54,045 calls to our Call Center. The response time for the most urgent calls was 26 minutes for Priority 1 calls and 39 minutes for Priority 2 calls.

Among the most relevant types of notices, 116 notices of breaks in our pipelines by third parties were attended to in an average of 29 minutes.

In addition, the Emergency team has participated in the Dark Gas campaign to reduce shrinkage, finding 98 anomalies or frauds in meters in villas.

As a notice of special interest, in August a water ingress in the low-pressure distribution network due to a breakdown of Canal de Isabel II, in the area of the Fuencarral district, was attended to, which caused a lack of supply to some 400 customers. This fault was solved in three days, from the moment the first warning was received until the service was restored to all the affected customers.

In 2022, the Emergency Department of Madrileña Red de Gas handled a total of 10,253 emergency calls, out of a total of 54,045 calls to our Call Center. The response time for the most urgent calls was 26 minutes for Priority 1 calls and 39 minutes for Priority 2 calls

Control Center

The main actions carried out during 2022, in relation to the Control and Distribution Center (CCD), are as follows:

• A request for 74 LNG tankers has been made, supplying 20.01. During 2022, there have been no incidents in the supply of LNG plants. The total emission of natural gas during 2022 has been 9,351 GWH.
• The replacement of obsolete equipment (dataloggers) with new remote stations has been completed.
• A total of 176 preventive and 320 corrective remote management systems have been implemented in all remote management facilities, including LPG plants with remote management systems.
• The new Synergi Gas network simulator has been implemented, allowing network behavior studies to be carried out with different types of gases.
• In the Cartography area, 862 works have been captured with a total of 32,275 meters and 1478 connections. The mapping of 19 municipalities has also been adapted and two new municipalities (Moralzarzal and Collado Mediano) have been mapped in order to start gas supply in the near future. The network has been updated in 48 LPG industrial estates that have been converted to natural gas.
• In the area of verification and measurement of industrial meters, 665 meter verifications and 49 converter verifications have been carried out, thus adapting our fleet to the new regulations and complying with the specifications indicated in the PD-01.