21 Other current liabilities

Other current liabilities of €211 million (€221 million at 31 December 2010) comprise:

Prepaid income from regulated activities of €129 million relates to: (i) the natural gas storage business segment (€84 million) and concerns payments for balancing and stock replenishment, which are to be returned to service users based on the provisions of Resolution 50/06 of the Electricity and Gas Authority; and (ii) the transportation business segment (€45 million) and concerns the short-term portion of revenues invoiced in excess of the restriction established by the Electricity and Gas Authority, and penalties charged to users who exceeded the committed capacity, which is to be returned through tariff adjustments pursuant to Resolution 166/05.

Information on the fair value of derivatives at 31 December 2011 is summarised below.

The fair value of hedging derivatives and their classification as an asset/liability over 12 months (non-current) or an asset/liability within 12 months (current) have been determined using generally accepted financial measurement models and market parameters at the end of the year. At 31 December 2011, Snam had 19 cash flow hedge derivatives in place.

The characteristics of these contracts, as well as their market value, are shown below:

The fair-value valuation of interest-rate derivatives is calculated on the basis of standard market valuation algorithms and market quotes/contributions provided by leading information providers.

For these contracts, the company agrees with the counterparty to exchange, on fixed dates, the difference between the floating-rate and fixed-rate calculated using the reference nominal value.

Three derivatives contracts were entered into during 2011, for €200 million, €500 million and €300 million respectively, and used to convert floating-rate loans into fixed-rate loans.

Changes in fair value posted as a decrease in shareholders’ equity in 2011, net of the related tax effect²⁵, amount to -€121 million (+€3 million at 31 December 2010).

The table below shows the swaps in place by type, the weighted average interest rate and the maturity of the transactions. The variable average rates are based on rates at year end; they are subject to changes which may significantly affect future financial flows.

A comparison between the average rates bought and sold is not indicative of the result of the derivative contracts put in place; this result is determined taking into account the underlying transaction.