23. Share capital

	Authorised Ordinary Shares of 50p	£m	Issued and fully paid Ordinary Shares of 50p	£m
At 1 January 2004	1,700,000,000	850	1,107,091,994	554
Increase in authorised share capital	566,000,000	283	–	–
Issue of shares	–	–	365,540,834	183
Issue of shares under the Sharesave Scheme	–	–	33,077	–
Issue of shares under Executive Share Option Scheme	–	–	603,161	–
At 31 December 2004	2,266,000,000	1,133	1,473,269,066	737

Rights Issue
The Company's Rights Issue closed on 14 September 2004. A total of 366 million Ordinary Shares were issued at 82p per share in a 33 for 100 Rights Issue. Of the total £286 million raised net of £14 million expenses, £183 million was credited to share capital and £103 million to the share premium account.

Deferred Shares
The Company has 21 Deferred Shares of 1 pence each in issue. These shares were issued to ensure the demerger was effected as efficiently as possible. The holders of Deferred Shares have no rights to receive dividends or to attend or vote at any general meeting.

Unclassified Share
Further to the redemption of the Special Share in August 2000, the Company's authorised share capital includes one unclassified share of £1.

Employee Share Plans

a) Share Options Plans
The Company operates the following employee share plans for which shares may be issued by the Company out of authorised but unissued share capital upon exercise of options: the 2002 Performance Share Plan; the UK Approved and Unapproved Executive Share Option Plans; the Global Executive Share Option Plan; the UK Approved Sharesave Plan and the Global Sharesave Plan. The UK Approved Sharesave Plan and the Global Sharesave Plan are savings related and enable employees to invest up to a maximum of £250 per month.

		Number of Ordinary Shares (millions)
Note		Sharesave Schemes	Executive Share Option Schemes	Performance Share Plan	Total
i)	Outstanding at 1 January 2004	6.0	22.7	3.8	32.5
	Adjusted post Rights Issue	0.3	3.3	0.5	4.1
	Granted	–	6.4	–	6.4
	Exercised (ii)/lapsed	(0.3)	(2.7)	–	(3.0)
i)	Total options outstanding at 31 December 2004	6.0	29.7	4.3	40.0

			Number of Ordinary Shares
	Option price	Date exercisable	31 December 2004	31 December 2003
i) Options outstanding	250.00p	2003	–	775
Sharesave Schemes	188.00p	2004	–	12,159
	167.37p	2006	10,082	8,976
	178.06p	2004	7,496	6,780
	178.06p	2006	6,631	7,592
	80.12p	2005	1,100,049	1,076,670
	80.12p	2007	2,693,549	2,492,950
	97.93p	2006	119,227	291,557
	97.93p	2008	72,817	216,667
	70.33p	2006	888,915	875,724
	70.33p	2008	780,259	748,259
	97.93p	2006	128,354	118,400
	97.93p	2008	156,103	151,834
Executive Share Option Schemes	297.94p	1996–2003	–	52,935
	336.21p	1997–2004	–	101,858
	272.55p	1998–2005	294,581	290,736
	287.76p	1999–2006	489,158	472,639
	343.73p	2000–2007	574,892	555,541
	313.92p	2001–2008	776,425	761,052
	331.42p	2002–2007	–	33,206
	277.55p	2003–2010	2,864,320	2,689,810
	209.22p	2004–2011	2,044,424	1,935,593
	193.19p	2004–2011	186,197	165,778
	174.50p	2005–2012	4,050,234	4,038,393
	62.32p	2006–2013	11,354,245	11,609,290
	123.53p	2007–2014	7,136,359	–
Performance Share Plan 2002	74.79p	2005–2006	4,276,215	3,807,057
Total options outstanding			40,010,532	32,522,231

ii) Options exercised (pre Rights Issue)	Option price	Number of options	Nominal value £	Consideration £
Executive Share Option Schemes	70.00p	603,161	301,580	422,213
Sharesave Schemes	90.00p	28,275	14,138	25,448
	79.00p	3,493	1,746	2,759
Total options exercised during the year		634,929	317,464	450,420

b) 2002 Performance Share Plan
At the AGM in May 2002, shareholders approved the establishment of the 2002 Performance Share Plan. In respect of the 2003 award, the Company granted to the Trustee an option to acquire 3,807,057 Ordinary Shares in the Company at an option price of 84 pence per share. Following the Rights Issue the number of shares under option was increased to 4,276,215 and the option price was adjusted to 74.79 pence per share. This option can only be exercised to the extent required to satisfy conditional awards made on 10 March 2003 under the Performance Share Plan. These conditional awards can only vest after the end of the relevant performance period and only to the extent to which the performance conditions have been achieved. The performance period ends on 31 December 2005. No shares were released in respect of this share plan during 2003.

c) Managers' share bonus arrangements
During 2004 a total of 571,710 shares in International Power were acquired in respect of a project incentive arrangement for staff (excluding Executive Directors) for a consideration of £887,497. These shares have been placed in an Employee Share Ownership Trust.

d) Employee Share Schemes
The Group takes advantage of the exemption granted under UITF 17 (revised) (Employee Share Schemes) whereby no compensation expense need be recorded for SAYE employee schemes.

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