1

InstitutionalMarch, 2011

2

AES Brasil Group

• Presence in Brazil since 1997

•

Comprised of seven companies in the sectors of energy generation, distribution, trade and telecommunications

• 7.7 thousand AES Brasil People

• Investments 1998-2009: R$ 5.8 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 dividend practice since 2006: –

AES Tietê: 100% pay-out on quarterly basis

–

AES Eletropaulo: 95% pay-out on semi-

annually basis

3

AES Brasil widely recognized in 2009-2010

Environmental concern

Management excellence

Quality and safety

(AES Eletropaulo) (AES Sul) (AES Eletropaulo) (AES Eletropaulo)

(AES Tietê) (AES Eletropaulo) (AES Tietê) (AES Tietê)

(AES Brasil) (AES Tietê)

(AES Eletropaulo)

4

AESInfoenergy

AESUruguaiana

AESCom Rio¹

AESEletropaulo

AESTietê

AES EletropauloTelecom¹AES Sul

AES Corp BNDES

C = Common SharesP = Preferred Shares

T = Total

Shareholding Structure

C 99.99 %T 99.99 %

C 99.99%T 99.99%

C 76.45%P 7.38%T 34.87%

Cia. Brasiliana de Energia

C 50.00% - 1 shareP 100%T 53.85%

C 50.00% + 1 shareP 0.00%T 46.15%

C 71.35%P 32.34%T 52.55%

C 98.25%T 98.25%T 99.70%

C 99.00%T 99.00%

1 –

AES Atimus

5

24.2% 28.3% 39.5% 8.0%

8.5%56.2%19.2%16.1%

Others¹Free Float

Listed Companies Shareholding Composition

1 –

includes Federal Government and Eletrobrás

shares in AES Eletropaulo and AES Tietê, respectively

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

1.9 1.81.6

1.3 1.11.0

0.80.6 0.6

0.2

CEMIG AES BRASIL CPFL NEOENERGIA TRACTEBEL CESP COPEL EDP LIGHT DUKE

4.0

3.22.8 2.6

2.21.8 1.7

1.4 1.2

0.5

AES Brasil is the second largest group in electric sector

Ebitda1 – 2009 (R$ Billion)

Net Income1 – 2009 (R$ Billion)

1 –

excluding Eletrobrás Source: Companies’

financial reports

7

AES TIETÊ DUKE

TRACTEBEL COPEL

PETROBRÁS CEMIG

ITAIPU CESP

ELETRONORTE FURNAS

CHESF OTHERS

2% 2%6%

4%

5%

6%

6%

7%

8%9%

10%

35%

Source: ANEEL (Regulator) –

BIG (October, 2010)

AES Tietê is the 2nd largest among private

generation companies and 10th largest overall

10 largest gencos correspond to 63% of the total

installed capacity

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): 7GW

–

Belo Monte (Xingu River): 11GW

Generation Installed Capacity (MW) - 2010Privately held companies

112 GW

AES Tietê is an important player among private energy generators

8

13%

13%

10%

7%6%6%

5%

40%

13%

12%

12%

16%6%7%

5%

30%

AES Brasil is the largest distribution group in Brazil

Consumption (GWh) - 2009

Consumers – Dec/2009

•

64 discos in Brazil distributing 388 TWh

•

AES Brasil is the largest electricity distribution group in Brazil:

–

AES Eletropaulo: 41 TWh distributed,

representing 10.6% of the Brazilian

market

–

AES Sul: 8 TWh

distributed,

representing 1.9% of the Brazilian

market

There is a limited opportunity for competition in Brazil as discos are restricted to operate within their concession areas

10

AES Tietê Overview

16 hydroelectric plants within the states of São Paulo and

Minas Gerais

30-year concession valid until 2029; renewable for another

30 years

Installed capacity of 2,657 MW, with physical guarantee1 of

1,280 MW

All amount of energy that AES Tietê can sell in the long

term is contracted to AES Eletropaulo until the end of 2015

As a pure energy generator, AES Tietê can only invest in

its core business

313 employees

Concession Area

1 -

Amount of energy allowed to be long term contracted

11

2010 2019

Total installed capacity is expected to reach 167 GW by 2019

Brazilian energy matrix is not expected to materially change over the next 10 years

1 -

Small Hydro Power Plant Source: EPE (Energetic Research Company)

167 GWAnnual Growth: 4.5% p.a. 112 GW

Energy sector in Brazil: supply perspectives

Installed Energy Capacity in Brazil

Hydro; 74%

Natural gas; 8%

Biomass; 5%

SHPP; 4%

Oil; 3%

Nuclear; 2%

Coal; 1%Diesel; 1%Wind; 1%Steam; 1%

Others; 9%Hydro; 70%

Natural gas; 7%

Biomass; 5%

SHPP; 4%

Oil; 5%

Nuclear; 2%Coal; 2%Diesel; 1%Wind; 4%Steam; 0%

Others; 14%

12

Distribution CompaniesTrading

Companies

Distribution Companies

Free Clients

Auctions

Energy sector in Brazil: contracting environment

Regulated Market Free Market

Spot Market PPAs1

1 –

Power Purchase Agreement

•

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 PPA

–

Existing Energy (A-1): Delivery in 1 year,

5-15 years PPA

Trading Companies

Free Clients

13

Energy Generation (MW average1) Billed Energy (GWh)

Operational Performance: billed energy growth due to high availability and bilateral contracts

1-

Generated energy divided by the amount of hours 2-

Energy Reallocation Mechanism

121% 118%

130%

125%

Generation/Physical guarantee

2007 2008 2009 2010

1,5451,512

1,6651,599

Generation - MWAvg AES Eletropaulo MRE Spot market Other bilateral contracts2

2007 2008 2009 2010

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

1,740 1,680 2,331 1,980573 331

1,150 1340117 30113,421 13,148

14,706 14,729

14

2008 2009 2010 2011 (e)

39 43

70

152

20 13

12

6

59 57

82

158

Investments Breakdown1 (R$ million) 2010 Investments

Investments New SHPPs1 -

Do not include capitalization of interests during the plants modernization and development of projects2 -

Small Hydro Power Plants

Planned modernization at Nova Avanhandava, Ibitinga and Caconde power plants in

2010 and 2011

2

79%

14%

6%

1%

Equipment and Maintenance

New SHPPs

IT projects

Environment

15

Start of the

EIA/RIMA filed at

CETESB

Environmental license

issuanceNew energy auction date

Beginning of the project

presentation to the

community

2010 2011 2012 2015 2016

• Preparation of basic project

•

Land acquisition

Commercial operation

date

Operational license

Environmental license issuance

JAN FEB MAR APR MAY JUN AUGJUL SEP OCT NOV DEC

Instalation license

Thermo SP: Expansion of 550MW in installed capacity

Public hearing

Expected timeline

16

2007 2008 2009 2010

1,4491,605 1,670 1,754

2007 2008 2009 2010

1,0991,254 1,255 1,320

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

Financial highlights*

CAGR: 7% CAGR: 6%

(*) 2009 and

2010 numbers

in IFRS

17

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

Net income of R$ 737 million, with a pay-out of 117%, in 2010*

1 –

Gross amount (*) 2009 and

2010 numbers

in IFRS

2007 2008 2009 2010

609692 706 737

Net income

100% 100%

110%117%

10%

12%11% 11%

0%

2%

4%

6%

8%

10%

12%

14%

0%

20%

40%

60%

80%

100%

Pay-out Yield PN

18

2007 2008 2009 2010

0.7

0.4 0.4 0.4

Net debt

0.6

0.3 0.3 0.3

Net debt / EBITDA

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

2013 2014 2015

297299 300

•

December, 2010:–

Average debt cost in 2010 was 114% of CDI1

p.a. or 14% p.a.–

Average debt maturity of 3.3 years–

Net debt: R$ 0.4 billion–

Net debt/EBITDA: 0.3x

1 –

Brazilian

Interbank

Interest

Rate

19

2007 2008 2009 2010

5,531 5,4688,086 9,683

3,566 2,692

2,101

4,2399,096 8,160

10,187

13,922

80

90

100

110

120

130

140

Dec-09 Mar-10 Jun-10 Sep-10 Dec-10

GETI4 IEE IBOV TSR

Capital Markets

1 –

Index: 12/30/2009= 100

AES Tietê X Ibovespa X IEE X TSR² Daily Avg. Volume (R$ thousand)

2010

•

Common shares and preferred shares listed on BM&FBOVESPA under the tickers GETI3 and GETI4

•

ADRs at US OTC Market under the tickers AESAY and AESYY

2 –

Total Shareholder Return –

considers preferred shares price variation and dividends declared in the period

+ 20%

+ 1%

+ 12%

+ 30%

Preferred Common

2

1

21

AES Eletropaulo Overview

Largest electricity distribution company in Latin America

Serving 24 municipalities in the São Paulo Metropolitan area

Concession contract valid until 2028

Concession area with the highest GDP in Brazil

45 thousand kilometers of lines, 1.2 million electricity poles and

6.1 million consumption units in a concession area of 4,526 km2

Total distributed volume of 43 TWh in 2010

As a pure energy distributor, AES Eletropaulo can only invest

within its concession area

5,663 employees

Concession Area

222004 2005 2006 2007 2008 2009 2010 2019

331 346 358 378 393 388420

633

Energy sector in Brazil: demand perspectives

4.4% p.a.

5.0% p.a

Macroeconomic Scenario

Brazilian Consumption Evolution (TWh)

EPE’s1 Assumptions:

•

Global financial sector recovery will not

take longer;

•

Brazilian economic growth will outpace

global average growth, even in an

international context of moderate

expansion;

•

Emerging markets – especially China –

will grow faster than developed

economies, positively affecting industrial

sector in Brazil;

•

Income elasticity of energy demand (2010-

2019): 1.04

•

Households growth: 2.2% p.a

1 -

Source: EPE (Energetic Research Company)

2004-2008 2010-2014 2015-2019

World 4.6 4.2 4.0

Brazil 4.7 5.2 5.0

GDP - Annual growth

23

Reference Company(PMSO)

Investment Remuneration

Depreciation

Energy Purchase

TransmissionSector Charges

Tariff Reset and Readjustment

•

Tariff Reset is applied each 4 years for AES Eletropaulo −

Next Jul/2011−

Parcel A: costs pass trough the tariff−

Parcel B: costs are set by ANEEL

•

Tariff Readjustment: annually −

Parcel A costs pass trough the tariff−

Parcel B cost are adjusted by IGPM +/-

X(1)

Factor

RemunerationAsset Base

X Depreciation

X WACC

Regulatory Ebitda

Parcel A - Non-Manageable Costs

Parcel B - Manageable Costs

•

Remuneration Asset Base:–

Applicable investments used to calculate the Investment Remuneration (applying WACC) and Depreciation

•

Reference Company:–

Efficient cost structure, determined by ANEEL (National Electricity Agency)

•

Parcel A Costs−

Non-manageable costs that totally pass-

through to the tariff−

Losses reduction improve the pass-

through effectiveness

(1) X Factor: index that capture productivity gains

Energy sector in Brazil: regulatory methodology

24

Consumption Evolution

Total Market (GWh1) 2010 Consumption Share (GWh1)

36%

14%

18%

26%

6%CAGR: 2%

1 –

Net of own consumption

2007 2008 2009 2010

32,577 33,860 34,436 35,434

7,355 7,383 6,832 7,911

39,93241,243 41,269 43,345

Captive Market Free Clients

36%

26%

17%

15%

6%

Residential

Commercial

Free Clients

Industrial

Others

25

Investments amounted R$ 682 million in 2010

Investments Breakdown (R$ million) Investments 2010

2008 2009 2010 2011(e)

410 478654 684

4737

28 36

457

516

682 720

Capex Paid by Customers

32%

27%

19%

9%

4%4% 4%

System Expansion Maintenance

Customer Service Losses Recovery

Others IT

Paid by the Clients

26

8.49 8.41 7.87

7.39

1.00 

2.00 

3.00 

4.00 

5.00 

6.00 

7.00 

8.00 

9.00 

SAIFI Aneel Target

0.00

1.00

2.00

3.00

4.00

5.00

6.00

2007 2008 2009 2010

5.64 5.206.17

5.43

SAIFI (times)

2007 2008 2009 2010

8.90 9.2011.86 10.68

SAIDI (hours)

11.34 10.92 10.09

9.32

1.00 

3.00 

5.00 

7.00 

9.00 

11.00 

13.00 

15.00 

SAIDI Aneel Target

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

SAIDI & SAIFI

8th

Sources: ANEEL, AES Eletropaulo and ABRADEE

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

►

2011 SAIDI ANEEL Target: 8.68 hours ►

2011 SAIFI ANEEL Target: 6.93 times

5th3rd 7th1st1st

27

2007 2008 2009 2010

6.5 6.5 6.5 6.5

5.0 5.1 5.3 4.4

11.5 11.6 11.8 10.9

Technical Losses¹ Commercial Losses

2007 2008 2009 2010

99.5 98.5101.1

102.4

•

Fraud and Illegal Connections (2010)

– 287 thousand inspections e 41 thousand frauds detected

– 56 thousand illegal connections regularized

•

Disconnections and Reconnections – Monthly Average (2009 X 2010)

–

Disconnections: increase from 80 thousand to 96 thousand

–

Reconnection: increase from 56 thousand to 86 thousand

•

Past due bill credit report (2010 monthly average): 343 thousand

Losses (%)Collection Rate (% over gross revenue)

Operational Indexes

2.9 p.p. -0.6 p.p.

1 –

The previous calculation methodology 2 -

Current technical losses used retroactively as reference

28

2007 2008 2009 2010

1.566 1.696 1.775

2.413

2007 2008 2009 2010

7,193 7,5308,786 9,697

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

CAGR: 8%

Financial Highlights*

CAGR: 11%

(*) 2009 and

2010 numbers

in IFRS

29

100.3% 101.5% 101.6%114.4%

14.4%20.3% 20.4%

28.6%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

140.0%

Pay-out¹ Dividend Yield

2007 2008 2009 2010

7131,027 1,156

1,348

Net Income

1 –

Gross amount

Net Income and Dividend Payout1 (R$ million)

Practice of 95% pay-outon semi-annually basis*

(*) 2009 and

2010 numbers

in IFRS

30

Amortization Schedule – Principal (R$ million)

1-

Brazilian Interbank Interest Rate

•

December, 2010:–

Average debt cost in 2010 was 110% of CDI1

or 12.9% p.a.–

Average debt maturity of 7.2 years–

Net debt: R$ 2.4 billion –

Net debt/EBITDA of 0.9x adjusted with Pension Fund

Debt ProfileNet Debt (R$ billion)

2007 2008 2009 2010

3.0 2.5 2.7 2.4

Net Debt (R$ billion)

1.8x1.5x

1.4x

0.9x

Net Debt/Ebitda Adjusted with Fcesp

2011 2012 2013 2014 2015 2016 2017 2018 2019-2028

253 278 294 526

221 331 222 373 179 83 45 48

51

55 58

62 67

903 336 323 342577

276390 285

440

1,082

Local Currency (ex FCesp) Fcesp¹

31

75

85

95

105

115

125

Dec-09 Feb-10 Apr-10 Jun-10 Aug-10 Oct-10

2010 1

Dec-10

+ 12%

+ 1%

- 7%

+ 18%

15,000.00

17,000.00

19,000.00

21,000.00

23,000.00

25,000.00

27,000.00

2007 2008 2009 2010

26,066 25,677

21,960

24,496

Average Daily Volume (R$ thousand)

Capital Markets

AES Eletropaulo X Ibovespa X IEEX TSR²

•

Common shares and preferred shares listed on BM&FBOVESPA under the tickers ELPL3 and ELPL4

•

ADRs at US OTC Market under the tickers EPUMY and ELPSY

A B

A BEx dividends: 05/01/2010 Ex dividends: 08/06/2010

1 –

Index: 12/30/2009 = 100

2 –

Total Shareholder Return -

considers preferred shares price variation and dividends declared in the period

Ibovespa IEE AES Eletropaulo PN AES Eletropaulo TSR³

Social Responsibility

33

•

300 benefited children between 1 and 6 years old

•

Own investments amounting R$ 1.5 million in 2009

•

Units: Santo Amaro and Guarapiranga

•

Over 6.7 thousand children, teenagers,

and adults have been benefited

•

Own and incentive investments:

approximately R$ 15 million in 2009

•

Activities of acting, dancing, circus arts, visual arts, music, gymnastics, courses of income generation, and education of safe use of electrical power and the right use of natural resources

•

7 operating units

“Casa da Cultura e Cidadania” Project

“Centros Educacionais Infantis Luz e Lápis” - Project

Social Responsibility

34

Social Responsibility

•

Launched in December, 2008;•

Objective: to get the co-workers committed to the transformation of low income communities and development of non-governmental institutions;

•

1,137 volunteers

Volunteering Program

Acting to Transform

Distributing Energy of

Good

Specific social mobilization or emergency campaign.

Winter clothes, Christmas campaign, among others.

Opportunities for volunteering in social organizations, which are

partners of AES Brazil

Co-workers can enroll in volunteer activities available at AES Brazil volunteering portal

since September/09www.energiadobem.com.br

Attachments

36

6.15.2

-0.6

7.55.7

3.6

-2.2

5.65.3

3.1

-2.2

3.9

2007 2008 2009 2010

Brazil Emerging markets (ex Brazil, India and China) OECD

6.1 5.2

(0.6)

7.5

13.9 13.6

(10.3)

25.6

2007 2008 2009 2010

GDP Investment (Gross Fixed Capital Formation)

Brazilian Economy: good performance, fast recovery after financial crisis

1-

OECD (Organization for Economic Co-operation and Development) –

international organization of 31 developed countries.

Brazil - GDP and Investment -

Annual growth -

% (IBGE)

GDP growth - Brazil x Other countries (IBGE, BCB, IMF and OECD)

•

Strong growth was interrupted by the financial crisis

•

The GDP for 2009 was mainly affected by lower investment (reversal of expectations)

•

Brazil´s economic performance during crisis was better than other countries

•

Strong recovery in GDP for 2010, specially investments

1

37

3.1 2.8 6.0

3.1

(7.4)

10.4

2005 2006 2007 2008 2009 2010

-20-15-10-505

10152025

Jan-

07

Apr

-07

Jul-0

7

Oct

-07

Jan-

08

Apr

-08

Jul-0

8

Oct

-08

Jan-

09

Apr

-09

Jul-0

9

Oct

-09

Jan-

10

Apr

-10

Jul-1

0

Oct

-10

Jan-

11

Exports Imports Trade Balance

Brazilian Economy: industry recovery and recent foreign trade expansion

Brazil – Industrial production -

Annual growth -

% (IBGE)

Brazil – Trade Balance –

US$ billion (Funcex)

•

Brazilian industry has reached pre-crisis level since mar/10

• In 2010, industry grew 10.4%

•

Exports limited the recovery in 2009

•

2010: growth of exports (world economy recovery) and imports (capital goods)

38

1.25

9

1.26

1

1.29

1

1.34

8

1.39

5

1.45

0

1.48

5

1.55

0

0.583

0.5720.569

0.563

0.5560.548

0.543

0,52

0,53

0,54

0,55

0,56

0,57

0,58

0,59

1.000

1.100

1.200

1.300

1.400

1.500

1.600

2003 2004 2005 2006 2007 2008 2009 2010

Real average income Gini Index

6.4

56789

1011121314

Jan-

04

Jul-0

4

Jan-

05

Jul-0

5

Jan-

06

Jul-0

6

Jan-

07

Jul-0

7

Jan-

08

Jul-0

8

Jan-

09

Jul-0

9

Jan-

10

Jul-1

0

Jan-

11

Real average income (R$) and income inequality (IBGE and IPEA)

Domestic market is responsible for the good performance

1-

It

measures the degree of income inequality. It may vary from 0 (complete equality) to 1 (complete inequality).

Unemployment rate -

% (IBGE)

•

Brazilian´s good performance

was driven by the expansion of

the domestic market

–

Unemployment rate has been

decreasing over the years

–

Real income has been growing

persistently since 2005

–

There was an improvement in

income distribution

1

39

Brazil – Retail Sales – seasonally adjusted –

2003 = 100 (IBGE)

Brazil – Loans to individuals – R$ million (BCB)

•

Besides the improvement on

labor market, credit expansion

was also responsible for the

good performance

• Retail sales is growing fast:

– 6.0% in 2009 despite

the

crisis

– 7.2% p. a. between

2005 and

2009

– 10.9% in 2010

Domestic market is responsible for the good performance

191 238

318

394

470

537

100

200

300

400

500

600

2005 2006 2007 2008 2009 Oct*

100110120130140150160170180

Jan-

05

Jul-0

5

Jan-

06

Jul-0

6

Jan-

07

Jul-0

7

Jan-

08

Jul-0

8

Jan-

09

Jul-0

9

Jan-

10

Jul-1

0

40

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

2

2007 2008 2009 2010

281 239 214 246

84112 201

187

365 351

415 434

Energy Purchase, Transmission and Connection Charges, and Water Resources

Other Costs and Expenses

41

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

2007 2008 2009 2010

4,097 4,700 5,125 5,490

1,4401,193

1,3061,255

5,537 5,8936,431

6,745

Energy Supply and Transmission Charges PMS² and Others Expenses

42

Expansion Requirement of 15%

Increase installed capacity in Sao Paulo State by 15% (400 MW), either in greenfield

projects or through long term purchase agreement with new plants

The obligation was supposed to be accomplished by December 2007,

however AES Tietê was not able to comply with this requirement due to the following restrictions:

–

Insufficient remaining hydro resources within the State of São Paulo

–

Environmental restrictions

–

Insufficiency of gas supply / timing issue

–

More restricted regulation on energy sale established by the New

Model of Electric Sector (Law # 10,848/2004) which eliminated the self dealing

•

In August 2008, Aneel informed that the issue is not linked to the concession

•

On July 27, 2009, AES Tietê was notified by the State Government

Attorney’s Office to present arguments on compliance with the expansion obligation

–

The Company filed a response on July, 29th, which exhausts the procedure for notification. Possible deployment depends on new manifestation of the Prosecution

•

Popular law action against Federal Government, Aneel, AES Tietê,

and Duke–

2008 –

In October, defense filed on first instance by AES Tietê; In December, the author replied AES Tietê defense

–

2010 –

In September, due to the plaintiffs failure to specify the individuals that should be named as Defendants, a favorable decision was rendered by the 1st Instance Court (but there can be appeals)

43

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

Next Steps:

1-

Eletrobras

will request the

auditing process

2 -

The auditing procedure will be concluded at least

in 6 months

3 -

After conclusion of the

expert work, the 1st

level of court decision will be

released

4 -

Appealing to the 2nd

level of court

5 -

Appealing to the 3rd

level of court

Jan/98 Oct/05

Eletrobras and CTEEP appealed

to the Superior Court of Justice

(SCJ)

Feb/10

The Judge appointed the expert who will

indicate the amount and the debtor

Due to a paperwork issue, Eletrobras will request the expert selection

again

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

44

Any party with an intention to dispose its shares should first provide the other party the right to buythat 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 AgreementOn 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 alongrights

Tag alongrights

45

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