Baldin puts CPFL into the Biomass business

The power plant generates electric energy by burning sugarcane bagasse

Foz do Chapecó HPPWe have just obtained the Operating

License (OL) for the Foz do Chapecó hydroelectric power plant on the Uruguay River between Santa Catarina and Rio Grande do Sul and we are now in the process of filling the reservoir.

Within a very short amount of time we will be adding another 436.05 MW to our generation capacity, which represents the 51% ownership interest we have in the project. The investments that CPFL has made in the project reached R$

1.2 billion, and will add approximately R$ 290 million through the company’s annual revenues.

Today we have 1,786 MW of installed capacity and according to our strategic plan we will have 2,805 MW by 2013, including hydroelectric, biomass and wind projects, representing growth of 57%.

When in full operation, Foz do Chapecó will generate enough electric power to satisfy 25% of the energy consumption in Santa Catarina or, put another way, the

residential consumption of a city of over 5 million inhabitants.

Foz do Chapecó is our eighth hydro-electric power plant. Our commitment as of now with our shareholders and investors is to continue to seek new growth opportunities in portfolios that are attractive from the value creation point of view. We are working towards this.

Wilson Ferreira Jr.CEO of CPFL Energia

Message from the CEO

CPFL Energia signed its first purchase of power deriving from sugarcane biomass during the 1990s and quickly became the largest buyer of energy from this source, a position it retains until today through the purchase of about 250 MWaverage.

Now, besides being a major buyer, CPFL has become a generator of electricity from sugarcane bagasse, as of the startup of its first biomass power plant.

The Baldin thermoelectric power plant was built in Pirassununga/SP,

representing an investment of R$ 104 million. The plant has an installed capacity of 45 MW, of which 24 MW can be exported. This business takes on greater importance because it inserts a new renewable matrix into CPFL, signaling the sustainable posture of the company to the market.

Currently, the share of bioelectricity in the Brazilian electricity matrix is 4.7%, the equivalent to 5,600 MW. In 2020, the forecast is that this number will reach 10%, with 14,400 MW of installed capacity.

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Baldin, now in commercial operation

INVESTOR RELATIONS | 33 | YEAR 6 | JULY/AUGUST 2010

Transparency highlighted

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See below the charts showing the performance of CPFL Energia’s shares over twelve-month period to July, both on the Bovespa (CPFE3) and on the New York Stock Exchange (CPL), and a comparison with the main index for each respective exchanges.

Source: Economatica Share price adjusted per dividends

18.6%

CPFE3 IEE IBOV07/31/09 29.56 20,975 54,76507/30/10 39.11 24,870 67,515Change 32.3% 18.6% 23.3%

32.3% 23.3%

Share performance –Bovespa – 12 months

CPL DJBr20 DJIA

Share performance –NYSE – 12 months

23.5%

07/31/09 47.15 26,629 9,17207/30/10 67.37 32,897 10,466Change 42.9% 23.5% 14.1%

42.9% 14.1%

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An evaluation of large Brazilian companies that are listed on the Ibovespa, and which takes into account transparency as a critical factor for investor confidence, listed CPFL Energia in first place in the energy segment. In the overall ranking, the company came in third. The result is part of a study that was conducted by Management & Excellence, IBRI and the Razão Contábil magazine, which resulted in the Sustainability Transparency Ranking of companies on the Ibovespa.

The index obtained by CPFL Energia was 91.87% and in the three areas evaluated reached 100% in Corporate Social Responsibility, 100% in Corporate Governance and 88.24% for Sustainability.

Evaluation

Analysts’ Recommendations

Analysts’ opinionA total of 28 financial institutions were providing coverage of CPFL Energia’s shares at the end of July 2010, with 75% having either a Buy or a Hold recommendation.

Online accessThe recommendations of these financial institutions can be consulted on CPFL Energia’s Investor Relations website. For full information, visit the www.cpfl.com.br/ir website. On the menu, select “Shareholder Information” and click on the “Analysts and Consensus” option.

Capital Markets

Stock market performance

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Market investors and analysts participated in the IV CPFL Energia Investors Meeting in partnership with Apimec SP August 19 in Campinas, at the company’s headquarters. The event brought together more than 100 participants and some of CPFL Energia’s main executives to discuss the trends and outlook for both the company and the electricity sector, as well as to present the earnings results for the second quarter of 2010.

The CEO of CPFL Energia, Wilson Ferreira Jr., made a presentation in which he discussed the different market and regulatory scenarios, the strategic direction the company is taking regarding alternative energy sources and

the prospects for Group’s expansion in the different segments in which it is active.

For his part, Hélio Viana Pereira, vice president for Distribution, stated that the company’s investments seek suspension of the electricity network coupled with its modernization and maintenance.

Miguel Abdalla Saad, vice president for Generation, explained that the operating license for the Foz do Chapecó hydroelectric power plant was about ready to be granted. The document in fact was obtained several days after the meeting.

The cycle of presentations was closed with a talk by the vice president for

Commercialization, Paulo Cezar Coelho Tavares, who detailed the expansion of CPFL Brasil in terms of energy and services sales since its creation in 2003, and showed the prospects for growth in the services segment through 2014, which would represent a leap in the results from this area of business.

After lunch, the participants were driven to Pirassununga where they made a technical visit to the Baldin thermoelectric power plant, the Group’s first sugarcane-fired termoelectric power plant. The plant is equipped with two generators, one rated at 30 MW and the other at 15 MW, capable of delivering 24 MW of assured power per harvest for export of energy to the Group.

Apimec

CPFL Energia brings investors together in Campinas

Photos: Giancarlo Giannelli

...to the presentation of President Wilson Ferreira Jr.

Participants visited the installations of the Baldin thermoelectric power plant in Pirassununga/SP

Investors pay close attention...

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CPFL INVESTOR is an Investor Relations publication, edited by the Office of Corporate Communications and Institutional Relations, Rodovia Campinas Mogi Mirim, Km 2.5 - Jd. Santana - Campinas/SP, Zipcode 13.088-900. Phone: + 55 19 3756-8456 Fax: + 55 19 3756-8040 - informativos@cpfl.com.br. Financial Vice President and Head of Investor Relations: Wilson Ferreira Jr., RMI Director: Gustavo Estrella, Corporate Communications Officer: Augusto Rodrigues. Manager of Journalism: Carlos Henrique Matos Ramos. Journalist Responsible: Maria Helena Portinari MTB15577. Content and Editing: Marcos Sambo. Design: Leonardo Castagna. Site: Investor Relations: www.cpfl.com.br/ir - email: ri@cpfl.com.br.

Trucost study was of conventional energy generationCPFL was elected by British consulting company Trucost, which specializes

in environmental impact evaluations, to be the company that had the lowest carbon emissions in its category (“conventional power generator”) in 2009.

The recently published study analyzed greenhouse gas, sulfur dioxide (SO2) and nitrogenous oxides (NOx) emissions as well as nuclear waste from 107 electric power companies around the world, divided into two categories — conventional power generator and renewable power generator.

CPFL Energia’s energy matrix was considered 1,000 times less carbon intensive in comparison with the electric energy company with the highest level of carbon emissions in the conventional power generator category, a Chinese enterprise.

CPFL Energia sold 14 MWaverage of wind energy during the 3rd Reserve Energy Auction, held by the Electric Power Commercialization Chamber (CCEE), which will be generated by the Campo dos Ventos II wind farm in Rio Grande do Norte. The price obtained through this operation was R$ 126.19/MWh, which will yield annual net revenues of R$ 16 million through a 20-year contract. This increase in the company’s generation capacity is in addition to the Santa Clara and Euros wind farms, with 188 MW of installed capacity, and its commercial start-up are scheduled to come on stream in July 2012.

The power to be generated by CPFL Biopedra’s thermoelectric power plants in Serrana/SP also was sold at the 3rd Reserve Energy Auction. The company sold 24.4 MWaverage of sugarcane biomass energy. The price obtained through this operation was R$ 145.48/MW through a 15-year contract valid as of 2012, adding R$ 31 million in annual net revenues to the Group.

CPFL Energia disclosed its main achievements and financial results for the first half of 2010 to over 200 investors during a meeting organized by the National Investors Institute (INI) in Piracicaba/SP.

The event, held on August 21, was aimed at investors and market professionals, involving disclosure about the companies, the company’s long-term investment culture and investments in shares.

CPFL was least carbon intensive generator in the world in 2009

Reserve Energy Auction Investors meeting in Piracicaba

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Divulgation

Hydroelectric power plants are sources of renewable energy

Sustainability