1

Institutional March, 2012

2

AES Brasil Group

• Presence in Brazil since 1997

• Comprised of four companies in the sectors of energy generation and distribution

• 7.4 thousand AES Brasil People

• Investments 1998-2011: R$ 8.1 billion

• Good corporate governance practices

• Sustainable practices in businesses

• Safety as a main value

• Strong cash generation capacity

• 25% of minimum pay-out according to bylaws

• Differentiated practice of dividend distribution since 2006:

– AES Tietê: 100% of net income on quarterly basis

– AES Eletropaulo: distribution above the minimum required (25% of net income) on semi-annual basis

3

(AES Eletropaulo) (AES Sul)

(AES Eletropaulo)

(AES Eletropaulo)

(AES Brasil)

(AES Tietê)

(AES Tietê)

(AES Eletropaulo)

(AES Tietê)

(AES Tietê) (AES Eletropaulo)

(AES Brasil)

AES Brasil widely recognized in 2009-2011

Quality and safety Management excellence Environmental concern

(AES Tietê) (AES Eletropaulo)

(AES Tietê)

4

AES Infoenergy

AES Uruguaiana

AES Eletropaulo

AES Tietê

AES Corp BNDES

C = Common Shares P = Preferred Shares

T = Total

Shareholding Structure

C 99.99% T 99.99%

C 76.45% P 7.38% T 34.87%

Cia. Brasiliana de Energia

C 50.00% - 1 share P 100% T 53.85%

C 50.00% + 1 share P 0.00% T 46.15%

C 71.35% P 32.34% T 52.55%

C 99.00% T 99.00%

AES Sul

T 99.70%

5

24.2% 28.3% 39.5% 8.0%

8.5% 56.2% 19.2% 16.1%

Others² Free Float ¹ ¹

1 - Parent companies, AES Corp and BNDES, have similar voting capital on each of the Companies: approx 38.2% on AES Eletropaulo and 35.7% on AES Tietê 2 - Includes Federal Government and Eletrobrás shares in AES Eletropaulo and AES Tietê, respectively 3 - Base: 09/30/2011. Considers preferred shares for AES Eletropaulo and preferred and common shares for AES Tietê

R$ 8.5 bi

R$ 4.8 bi

Market Cap³

Listed Companies Shareholding Composition

6 CEMIG AES BRASIL NEOENERGIA CPFL TRACTEBEL COPEL EDP LIGHT DUKE CESP

2.3 2.2

1.81.6

1.21.0

0.6 0.6

0.20.1

AES Brasil is the second largest group in electric sector Ebitda1 – 2010 (R$ Billion)

Net Income1 – 2010 (R$ Billion)

1 – excluding Eletrobrás Source: Companies’ financial reports

CEMIG AES BRASIL CPFL NEOENERGIA TRACTEBEL CESP EDP LIGHT COPEL DUKE

4.54.2

3.43.0 2.6

2.0 1.6 1.6 1.5

0.6

TRACTEBEL 6,1%

AES TIETÊ 2,3%

CPFL2,4%

DUKE1,9%

EDP1,6%

NEOENERGIA1,2%

ENDESA0,8%

LIGHT0,8%

CHESF 9%

FURNAS 8%

ELETRONORTE 8%

ITAIPU 6%

ELETRONUCLEAR3%

CGTEE1%

ELETROSUL0,4%

CESP 6%

CEMIG6%

PETROBRÁS 5%

COPEL4%

DEMAIS27%

7 1- Sources: ANEEL – BIG (March, 2012) and Companies websites 2- Source: Merrill Lynch 3 – Eletrobrás, totaling 35%

³

AES Tietê is the 3rd largest among private

generation companies and 10th largest

overall

Approximately 78% of country’s

generation installed capacity is state-

owned2

There are three mega hydropower plants

under construction in the North region of

Brazil with 18 GW in installed capacity

– Santo Antonio and Jirau (Madeira River): 7 GW

– Belo Monte (Xingu River): 11 GW

Total Installed Capacity: 117 GW

Main privately held Companies

³

³

³

³

³

³

AES Tietê is an important player among private energy generators

Generation Installed Capacity (MW) - 20121

8

AES Brasil is the largest distribution group in Brazil

Consumption (GWh) - 2010

Consumers – Dec/2010

• 63 distribution companies in Brazil distributing 419 TWh

• AES Brasil is the largest electricity distribution group in Brazil:

– AES Eletropaulo: 43 TWh distributed,

representing 10.3% of the Brazilian

market

– AES Sul: 9 TWh distributed,

representing 2.2% of the Brazilian

market

Distribution companies’ operations are restricted to their concession areas

Acquisitions must be only performed by the holdings of economic groups

13%

12%

10%

7%6%6%

6%

40%

12%

12%

12%

16%7%7%

5%

30%

A

AES Brasil

CPFL Energia

Cemig

Neo Energia

Copel

Light

EDP

Outros

Energy Sector in Brazil

¹ Interconected National System

² Small Hydro Power Plants Sources: EPE, Aneel, ONS and Merrill Lynch

• 13 groups controlling 76% of total installed capacity

• 22% private sector

• 1,862 power plants

• 117 GW of installed capacity

• 73% hydroelectric

• 17% thermoelectric

• 5% biomass

• 4% SHPP2

• 1% Wind

• Contracting environment – free and regulated markets

• 68 companies

• 68% private sector

• High voltage transmission

(>230 kV)

• 98.648 km in extension

lines (SIN¹)

• Regulated public service

with free access

• Regulated tariff (annually

adjusted by inflation)

• 63 companies

• 430 TWh of energy

distributed in 2011

• 70 million consumers

• 67% private sector

• Annual tariff adjustment

• Tariff reset every four or

five years

• Regulated public service

• Regulated contracting

environment

• Consumption of 113 TWh

(26% of Brazilian total market)

• Conventional sources: above 3000 kW

• Alternative sources: between 500 kW e 3000 kW

• Large consumers can purchase energy directly from generators

• Free contracting environment

Generation Transmission Distribution Free Clients

Energy Sector in Brazil: business segments

10

Auctions: New Energy and Existing Energy Bilateral contracts (PPAs1)

• Main auctions (reverse auctions): – New Energy (A-5): Delivery in 5 years, 15-30 years regulated PPA1

– New Energy (A-3): Delivery in 3 years, 15-30 years regulated PPA1

– Existing Energy (A-1): Delivery in 1 year, 5-15 years regulated PPA1

11

Energy sector in Brazil: contracting environment

Generators, Independent Power Producers (IPPs), Trading companies and Auto producers

Free clients Distribution companies

Generators and Independent Power Producers (IPPs)

Regulated Market Free Market

1 – Power Purchase Agreement

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

349 369 380 376408

423444

469493

515

12

4.0% p.a.

5.0% p.a.

EPE’s1 Assumptions:

• Latest EPE’s estimates considers an economic activity slowdown in Brazil (industrial stagnation and higher inflation).

• For the next years, the good performance of domestic market and the perspectives of higher investments are factors indicating that the Brazilian economy will recover the growth path observed before the global crisis.

• Brazil will also benefit from the growth of emerging markets, with impact on exports of primary products.

3.6%

Macroeconomic Scenario

Brazilian Consumption Evolution (TWh)

Energy sector in Brazil: demand perspectives

1 - Source: EPE (Energetic Research Company) / ONS (National System Operator) – Second Review – september/11

2004-2008 2010 2011 2012-2015

3.6 7.2 4.0 5.0

GDP - Annual growth (%)

Total installed capacity is expected to reach 171 GW by 2020

Brazilian energy matrix will present higher diversification, but in the next 10 years hydropower plants will continue to prevail

13

Hydro: 67%

SHPP: 4%Natural gas: 7%

Biomass: 5%

Oil: 5%

Nuclear: 2%Coal: 2%Diesel: 1%

Wind: 7%

Steam: 0%

Others: 17%

1- Source: EPE (Energetic Research Company), Ten-year Energy Plan 2020, May/2011 2 - Small Hydro Power Plant

2020: 171 GW 2011: 115 GW

2

2

Energy sector in Brazil: supply perspectives

Installed Energy Capacity in Brazil1

Hydro: 73%

SHPP: 4%

Natural gas: 8%

Biomass: 5%

Oil: 3%

Nuclear: 2%

Coal: 2%Diesel: 1%Wind: 1%Steam: 1%

Others: 10%

14

Regulatory Opex

(PMSO)

Investment Remuneration

Depreciation

Energy Purchase

Transmission Sector Charges

Tariff Reset and Readjustment

• Tariff Reset is applied each 4 years for AES Eletropaulo − Base date: Jul/2011 − Parcel A: costs are largely passed through to the tariff − Parcel B: costs are set by ANEEL

• Tariff Readjustment: annually − Parcel A : costs are largely passed through to the tariff − Parcel B: cost are adjusted by IGPM +/- X(1) Factor

Remuneration Asset Base

X Depreciation

X WACC

Regulatory Ebitda

Parcel A - Non-Manageable Costs

Parcel B - Manageable Costs

• Remuneration Asset Base: – Prudent investments used to calculate

the investment remuneration (applying WACC) and depreciation

• Regulatory Opex: – Efficient operating cost determined by

ANEEL (National Electricity Agency)

• Parcel A Costs − Non-manageable costs that are largely

passed through to the tariff − Incentives to reduces costs

1 – X Factor: index that captures productivity gains

Energy sector in Brazil: regulatory methodology

15

3rd Cycle of Tariff Reset – X Factor

Energy sector in Brazil: regulatory methodology

X FACTOR

= Pd

Q

T

+ +

Distribution productivity

Quality of service Operational expenses trajectory

To capture productivity gains with distribution

To stimulate the improvement of the

service quality

To implement operational expenses trajectory during

the tariff cycle

Defined at tariff reset, considering the

average productivity of sector adjusted by the

market growth and variation of consumer units of the distributor

since last reset

Defined at each tariff readjustement, according to the

variation of SAIDI and SAIFI and comparative performance of discos

Defined at tariff reset, considering the

expenses established by reference company and

benchmarking methodologies

DEFINITION

OBJECTIVE

APPLICATION

17

AES Tietê Overview

17 hydroelectric plants operating within the states of

São Paulo and Minas Gerais

30-year concession valid until 2029; renewable for

another 30 years

Installed capacity of 2,659 MW, with physical guarantee1

of 1,280 MW average

Almost all the amount of energy that AES Tietê can sell

in the long term is contracted to AES Eletropaulo until

the end of 2015

AES Tietê can invest in generation, its main activity, and

operate in energy trading

355 employees

Generation facilities

1 - Amount of energy allowed to be long term contracted

Generated energy shows high operational availability

Generated energy (MW avarage1)

1 – Generated energy divided by the amount of hours * Caconde, Limoeiro, Mogi and SHPPs

Generated energy by power plant (MW avarage1)

18

118%

130%125% 124%

Generation/Physical guarantee

2008 2009 2010 2011

1,512

1,6651,599 1,582

Generation - Mw avg

58%

6%5%

3%

6%

8%

10%4% Água Vermelha

Bariri

Barra Bonita

Euclides da Cunha

Ibitinga

Nova Avanhandava

Promissão

Other Power Plants*

2008 2009 2010 2011

11,138 11,108 11,108 11,108

1,680 2,331 1,980 1,942

331 1,150 1,340 1,519

117 301 55413,148 14,706 14,729 15,122

94%

3%2%1%

A significant amount of billed energy and net revenues comes from the bilateral contract with

AES Eletropaulo Energy Billed (GWh)

1 – Leap Year 2 – Energy Reallocation Mechanism

Net Revenues (%)

19

AES Eletropaulo MRE Spot Market Other bilateral contracts2

1

AES Eletropaulo

Other bilateral contracts

Spot Market

MRE

2008 2009 2010 2011 2012(e)

39 4370

156 174

20 13

12

19

59 56

82

175

Investments New SHPPs*

20

Investments (R$ million) 2011 Investments

Investments in the modernization of Nova Avanhandava, Ibitinga and Caconde

power plants

*Small Hydro Power Plants

85%

11%4%

Equipment and Modernization

New SHPPs*

IT Projects

21

Growth opportunities

Perspectives

• Project features - Combined cycle using natural gas

- Estimated investment of R$ 1.1 billion

- Natural gas consumption: 2.5 million m3/day

- 550 MW of installed capacity

• Next events

• Updates - Environmental license obtained on October, 20th 2011

(valid for 5 years)

- Gas unavailability for A-5 in 2011 and A-3 Energy Auction in 2012

- Get the installation license - Obtain gas supply in order to:

- Participate in the next auctions; or - Evaluate energy offering in the free market

2008 2009 2010 2011

1,605 1,670 1,7541,886

22

Ebitda (R$ million) Net Revenue (R$ million)

Financial highlights*

(*) 2009, 2010 and 2011 numbers in IFRS

78% 75% 75% 78%

Ebitda Margin

Recurring Non-recurring

(54)

2008 2009 2010 2011

1,309 1,311

9

1,254

1,255 1,320

1,466

Practice of total net income distribution on quarterly basis*

Net Income and Dividend Pay-out1 (R$ million)

23

IFRS Effect 1 – Gross value (*) 2009, 2010 and 2011 numbers in IFRS

Recurring Non - recurring

12% 11% 11% 11%

(36)(74) (78)

2008 2009 2010 2011

692 816 784 845

31706 737

100%110%

117%109%

Pay - out Yield Pref

24

Debt profile

Net Debt (R$ billion) Amortization Schedule – Principal (R$ million)

• December, 2011: – Average debt cost in 2011 was 115% of CDI1 p.a. or 15% p.a. – Average debt maturity of 2.6 years

1 – Brazilian Interbank Interest Rate

2013 2014 2015

300 300 300

0.3x 0.3x 0.3x 0.3x

Net Debt / EBITDA

2008 2009 2010 2011

0.4 0.4 0.40.5

Dívida Líquida

25 1 – Index: 02/28/2011 = 100 3 – Total Shareholders’ Return

Capital Markets

• Market Cap4: R$ 9.1 billion

• BM&FBovespa: GETI3 (common shares) and GETI4 (preferred shares)

• ADRs negotiated in US OTC Market: AESAY (common shares) and AESYY (preferred shares)

4 – Index: 02/29/2012

Daily Avg. Volume (R$ thousand) AES Tietê X Ibovespa X IEE

2 – Electric Energy Index

2009 2010 2011 YTD Feb/12

8,086 9,683 9,573 13,635

2,101 4,239 3,397

4,344 10,187

13,922 12,970 17,980

Preferred Common

60

70

80

90

100

110

120

130

140

Feb-11 May-11 Aug-11 Nov-11 Feb-12

12 Months 1

Ibovespa IEE² GETI4 TSR³ GETI3

+ 22%

-2%

+ 11%+ 21%

+ 4%

27

AES Eletropaulo overview

Largest electricity distribution company in Latin America

Serving 24 municipalities in the São Paulo Metropolitan area

Concession contract valid until 2028; renewable for another 30

years

Concession area with the highest GDP in Brazil

45 thousand kilometers of lines and 6.3 million consumption

units in a concession area of 4,526 km2

Total distributed volume of 45 TWh in 2011

AES Eletropaulo, as a distribution company, can only invest in

assets within its concession area

5,668 employees

Concession Area

28

Consumption evolution

Total Market1 (GWh) 2011 Consumption by Class (%)

36%

14%

18%

26%

6%

1 – Net of own consumption

2008 2009 2010 2011

33,860 34,436 35,434 36,817

7,383 6,832 7,911 8,28441,243 41,269

43,34545,102

Captive Market Free ClientsBrazil AES Eletropaulo

2636

17

28

43

26

14 9

Residential Commercial Industrial Others

-15%

-10%

-5%

0%

5%

10%

15%

jul/07 ago/08 set/09 out/10 nov/11

Produção Industrial SP (% 12 meses) Industrial (% 12 meses)

Economic recovery Economic crisis

Industrial class Industrial class X industrial production in São Paulo State

Consumption of industrial class by activity – AES Eletropaulo

• Industrial consumption is

influenced by manufacturing

industry performance in São Paulo

State

• Recent slowdown is influenced by

the decrease of industrial

production in 2011

• Moreover, the migration of clients

to other regions of São Paulo State

and of the country negatively

impacts this class Vehicles,

Chemical, Rubber, Plastic and Metal

products 50%

Other industries50%

29

Dec/11

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

258

220 192 199 203 207 213 219 223 228 229 234

- 9.4%

Residential class Residential class X Average income in São Paulo Metropolitan Area

1 - Two quarters of delay in relation to consumption

• Residential class is influenced by income in São Paulo Metropolitan Area

• Maintenance of the income expansion trend in São Paulo Metropolitan Area will sustain growth of residential class

• Average annual growth (2003-2011):

– total residential market: 5.5% y.y.

– consumption per consumer: 2.1% y.y.

Consumption per consumer is still 9.4% lower than in the period before the rationing

30

Consumption per consumer (in kWh)

2.800

3.300

3.800

4.300

4.800

1.000

1.200

1.400

1.600

1.800

1Q06 3Q06 1Q07 3Q07 1Q08 3Q08 1Q09 3Q09 1Q10 3Q10 1Q11 3Q11

Resi

dent

ial

(GW

h)

Aver

age

Inco

me

R$ -

SP (q

-2¹)

Avg Real Income R$ - SP (q-2¹) Residential (GWh)

4Q11

31

2008 2009 2010 2011 2012(e)

410 478654 717

7944737

2822

46

457516

682739

841

Capex Paid by Customers

Investments amounted R$ 739 million in 2011

Investments Breakdown (R$ million) Investments 2011 (R$ million)

31

227

172

189 35

39 22 55

MaintenanceClient ServiceSystem ExpansionLosses RecoveryITPaid by the ClientsOthers

2008 2009 2010 2011

9.20 11.86 10.6010.36

SAIDI (hours)

2008 2009 2010 2011

5.20 6.17 5.43 5.45

SAIFI (times)

8.41 7.87

7.39

6.93

SAIFI Aneel Reference

10.92 10.09

9.32 8.68

SAIDI Aneel Reference

32

SAIFI - System Average Interruption Frequency Index SAIDI - System Average Interruption Duration Index

SAIDI & SAIFI

8th 5th 7th 1st 7th 3rd

Sources: ANEEL, AES Eletropaulo and ABRADEE

ABRADEE ranking position among the 28 utilities with more than 500 thousand customers

► 2012 SAIDI ANEEL Reference: 8.67 hours ► 2012 SAIFI ANEEL Reference: 6.87 times

6th 4th

33

Losses (%)

1 – Current technical losses used retroactively as a reference

Collection Rate (% over Gross Revenues)

Operational Indexes

From Jul/10 to Jun/11: 12.45% From Jul/09 to Jun/10: 12.32%

ANEEL References:

2008 2009 2010 2011

6.5 6.5 6.5 6.5

5.1 5.3 4.4 4.0

11.6 11.810.9 10.5

Technical Losses¹ Commercial Losses

2008 2009 2010 2011

98.5101.1 102.4 102.1

34

“Creating Value” Project

Internal process review: (i) operating activities; (ii) support functions

Target definition for productivity increase

Reassess organization structure

Review supply management

Reassess and reinforce non-technical losses initiatives

Objective: to operate

within the regulatory

framework for

operational costs,

and seek benchmark

position in the

sector

35

Ebitda (R$ million) Net Revenues (R$ million)

Financial Highlights*

(*) 2009, 2010 and 2011 numbers in IFRS

2008 2009 2010 2011

7,530

8,7869,697 9,836

2008 2009 2010 2011

1,607 1,491 1,648 1,542

-197

339 372 89 87

426 933

1,696 1,775

2,413 2,848

RecurringRegulatory assets and liabilitiesNon-recurring

36 (*) 2009, 2010 and 2011 numbers in IFRS 1 – Gross amount

Net Income and Dividend Payout1 (R$ million)

Practice of dividend distribution on semi-annual basis*

2008 2009 2010 2011

698 622 761 680

160 236 241

329374

350 6521.027 1.156

1.348 1.572

Net Income - Ex one-offs, regulatory assets and liabilities

Regulatory assets and liabilities

One-offs

101,5% 93,4% 100,0%

54,4%

20,3% 20,4% 28,6% 17,1%

Pay-out Yield PN

66%

33%

1%

CDI¹ IGP - DI² Others

2012 2013 2014 2015 2016 2017 2018 2019 2020 -2028

281 299

527

223332

222373

179

94 43

46

50

5357

61

65

762375 342

574

272 385

279

434

65

941

Local Currency (ex FCesp) Fcesp³

2008 2009 2010 2011

2.5 2.7

2.4 2.3

Net Debt (R$ billion)

37 1 – Brazilian Interbank Interest Rate 2 – Inflation Index 3 – Pension Fund

• December, 2011:

- Average debt cost was 110% of CDI¹ or 12.1% p.a. - Average debt maturity of 6.7 years

Debt Profile Net Debt

Amortization Schedule – Principal (R$ million)

2008 2009 2010 2011

1.5x 1.4x0.9x 0.8x

2.4x2.0x

1.6x1.3x

Gross Debt/Ebitda Adjusted with FcespNet Debt/Ebitda Adjusted with Fcesp

70

80

90

100

110

120

130

Feb-11 May-11 Aug-11 Nov-11 Feb-12

12 Months 1

Ibovespa IEE² AES Eletropaulo PN AES Eletropaulo TSR³

+ 22%

-2%

+ 15%

+ 30%

38

Average Daily Volume (R$ thousand)

Capital Markets AES Eletropaulo X Ibovespa X IEE

• Market cap4: U$ 3.6 billion • BM&FBOVESPA: ELPL3 (common shares) and ELPL4 (preferred shares) • ADRs at US OTC Market: EPUMY (preferred shares)

1 – Index: 12/29/2011 = 100 2 – Electric Energy Index 3 – Total Shareholders’ Return 4 - Index: 02/29/12. Calculation includes only preferred shares

2009 2010 2011 YTD Feb/12

21,960

24,49626,897 26,044

Ex dividends: 04/30/2011 Ex dividends: 08/11/2011

A B

A B

Sustainability and Social Responsibility

40

Commitment with sustainability

Our Commitment with Sustainability

We act as a transformer agent understanding, meeting and anticipating our customers electric power needs with safe and

innovative solutions for the economic, environmental and social development of the communities in which we are present.

Commitment with sustainability

Transversal

Themes

41

To learn more access: www.aesbrasilsustentabilidade.com.br

TRANSVERSAL THEMES

Education for sustainability Stakeholders active

participation

Communication Knowledge Information

EFFICIENCY IN THE USE OF

RESOURCES

... means allocating them in such a manner

that balanced and perennial results are

ensured for all stakeholders, abiding by the values practiced by

the company

SAFETY

... means an attitude of protection of our

coworkers, suppliers and of the population.

INNOVATION IN PRODUCTS

AND SERVICES

... means providing an environment and

culture that inspire solutions that improve people’s life, ensuring quality and excellence

in the services rendered to the customer.

SUSTAINABLE ENERGY

GENERATION

... means using economic, social and

environmental resources in a balanced fashion, preserving the

present time and ensuring the future

DEVELOPMENT & VALUATION

OF COWORKERS, SUPPLIERS

AND COMMUNITIES

...means knowing, involving in a

transparent form and positively influencing

our coworkers, suppliers and

communities to build a collective agenda that

generates value for everyone

“Casa de Cultura e Cidadania” Project Offers activities in culture and sports, courses, workshops and lectures. Directly benefits approximately 5.6 thousand children

and teenagers and, indirectly, 290 thousand people in 7 units located within AES Brazil companies’ area of operation.

Social Responsibility: Main Projects

“Centros Educacionais Luz e Lápis” Project Two units in São Paulo attending 320 children from 1 to 6 years old, in social vulnerability.

Children education and development

Development and transformation of communities Education, culture

and sport

42

Converting Consumers to Clients A project developed to work on electrical network regularization. Since 2004, more than 500 thousand families in low income communities were benefited from better energy supply conditions and social inclusion.

Social Responsibility: Main Projects

43

“AES Eletropaulo nas Escolas” Project Education about safe and efficient use of energy to 4.5 thousand teachers and 404 thousand students from 900 public schools, between 2010 and 2011. The actions include recreational

activities offered in adapted trucks.

Education about Safety and Efficiency in energy consumption

Attachments

45

Costs and Expenses

Costs and operational expenses1 (R$ million)

1 – Do not include depreciation and amortization 2 - Personnel, Material, Third Party Services and Other Costs and Expenses

2008 2009 2010 2011

239 214 246 245

112 201 187 174

351415 433 420

Energy Purchase, Transmission and Connection Charges, and Water Resources

Other Costs and Expenses2

46

Costs and Expenses

Costs and operational expenses1 (R$ million)

1 – Do not include depreciation and amortization 2 - Personnel, Material, Third Party Services and Other Costs and Expenses

PMS2 and Other Expenses (R$ million)

2008 2009 2010 2011

4,700 5,125 5,490 5,689

1,1931,306

1,255 1,2725,8936,431

6,7456,961

Energy Supply and Transmission ChargesPMS² and Others Expenses

2008 2009 2010 2011

485700 647 622

329

352 443 513

379

254 165 1381,193

1,306 1,255 1,272

Personnel and Payroll Material and Third Party Others

Action Plan: R$ 242 million in 2011-2012

47

Concluded in 2011

increase of 212 emergency teams, totalizing 353 teams trained to perform attendances in powered grid

hiring and training of 580 maintanance and construction electricians hiring of 30 additional prunning electricians 38% increase in call center positions (150 positions) doubling of SMS receipt capacity to 100 thousand / day increase of call center service capacity by 27 times from 2 thousand to 54 thousand calls / hour 300 additional stand-by positions in call center for emergency situations

increase of 120 emergency teams, totaling 473 teams December/11 to March/12

48

AES Tiete's expansion obligation

Efforts being made by the Company to

meet the obligation :

• Long-term energy contracts (biomass)

totaling an average of 10 MW

• SHPP São Joaquim - started operating in July, 2011, with 3 MW of installed capacity

• SHPP São José – under construction,

with 4 MW of installed capacity, expected to

be operational in 1H12

• Thermo-SP - Project of a 550MW gas fired

thermal plant

1999 Jul/09 Oct/08 Aug/08 Sep/11 Sep/10

Privatization Notice established the

obligation to expand the installed capacity in 15% (400 MW) until

2007, either in greenfield projects and/or through long

term purchase agreements with new

plants

Aneel informed that the issue is not related to

the concession agreement and

must be addressed with the State of São

Paulo

Judicial Notice:

The Company was notified by the State of São Paulo

Attorney's Office to present its understanding on the matter, having filed its response on time, the

proceedings were ended, since no other action was

taken by the Attorney's Office

In response to a Popular Action (filed by

individuals against the Federal Government, Aneel, AES Tietê and Duke), the Company presents its defense

before the first instance

Popular Action: Due to the plaintiffs failure to specify the persons that

should be named as Defendants, a favorable

decision was rendered by the first Instance Court

(an appeal has been filed)

AES Tietê was summoned to answer a

Lawsuit filed by the State of São Paulo, which requested the

fulfillment of the obligation in 24 months.

An injunction was granted in order to have

a project submitted within 60 days.

Nov/11 2007

Company faces restrictions until deadline:

• Insufficiency of hydro resources • Environmental restrictions

• Insufficiency of natural gas supply • New Model of Electric Sector (Law # 10,848/2004), which forbids bilateral agreements between generators and

distributors

Feb/12

Lawsuit:

The Company appealed to the

State of Sao Paulo State Court

of Appeals and the injunction was

stayed

São Paulo State Supreme Court

rejected AES Tietê’s appeal. The

grounds for the denial and the contents of the

decision have not yet been disclosed.

49

Next Steps:

1 - The auditing procedure (AP) is expected to

begin by the 1st half of 2012

2 – AP is expected to be concluded in at least 6 months

3 - After AP’s conclusion, a 1st level court

decision will be released

4 - Appealing to the 2nd instance

court

5 - Foreclosure starts.

Presentation of guaranty

6 - Request to withdraw the

guaranty

7 - Appeals to the 3rd instance

courts

Eletrobras Lawsuit

Nov/86

Stated-owned Eletropaulo

borrowed money from Eletrobras

Dec/88

State-owned Eletropaulo and

Eletrobras disagreed on how

to calculate interest over that loan and a lawsuit

was started

Sep/03

The 2nd level of court excluded

AES Eletropaulo from the

discussion based on the spin-off

agreement

Jun/06

The SCJ decided to send the

Execution Suit back to the 1st level of court

May/09

Eletrobras requested the 1st

level of court judge to appoint

an expert

Jan/98 Oct/05

Eletrobras and CTEEP appealed

to the Superior Court of Justice

(SCJ)

Dec/10 Sep/01

Eletrobras, after winning the

interest calculation

discussion, filed an Execution Suit to collect the due

amount

State-owned Eletropaulo was spun-off into four companies and, according to our understanding based on the

spin-off agreement, the discussion was transferred to

CTEEP

Privatization event . State-

owned Eletropaulo

became AES Eletropaulo

Apr/98

Eletrobras requested the

beginning of the appraisal

procedure, which is under 1st. instance

court analysis

Jul/11

On July 7, the judge determined Eletropaulo and

CTEEP to present their

considerations, which occurred in

August

50

Any party with an intention to dispose its shares should first provide the other party the right to buy that participation at the same price offered by a third party

Once the offering party exercises the Drag Along clause, offered party is obligated to dispose of all its shares at the time, if the Right of 1st Refusal is not exercised by offered party

In the case of change in Brasiliana’s control, tag along rights are triggered for the following

companies (only if AES is no longer controlling shareholder): – AES Eletropaulo: Tag along of 100% in its common and preferred shares – AES Tietê: Tag along of 80% in its common shares – AES Elpa: Tag along of 80% in its common shares

Shareholders Agreement On Dec 2003 AES and BNDES signed a Shareholders’ Agreement to regulate their relationship as shareholders of Brasiliana and its controlled companies. The Agreement is available at www.aeseletropaulo.com.br/ri Shareholders can dispose its share at any time, considering the following terms:

Right of 1st refusal

Drag along rights

Tag along rights

51

Brazilian Main Taxes

AES Eletropaulo

• Income Tax / Social Contribution:

– 34% over taxable income

• ICMS: 22% over Revenue (average rate)

– Residential: 25%

– Industrial and Commercial: 18%

– Public Entities: free

• PIS/Cofins:

– 9.25% over Revenue minus Costs

AES Tietê

• Income Tax / Social Contribution:

– 34% over taxable income

• ICMS (VAT tax)

– deferred tax

• PIS/Cofins (sales tax):

– Eletropaulo´s PPA: 3.65% over Revenue

– Other bilateral contracts: 9.25% over Revenue

minus Costs

The statements contained in this document with regard to the business prospects, projected operating and financial results, and growth potential are merely forecasts based on the expectations of the Company’s Management in relation to its future performance. Such estimates are highly dependent on market behavior and on the conditions affecting Brazil’s macroeconomic performance as well as the electric sector and international market, and they are therefore subject to changes.

Contacts: ri.aeseletropaulo@aes.com

ri.aestiete@aes.com

+ 55 11 2195 7048